CITATION : Miller v. Ledra et al. 2023 ONSC 4656

COURT FILE NO.: CV-22-00686131

DATE: 20230828

SUPERIOR COURT OF JUSTICE – ONTARIO

RE: Nigel Miller, Applicant

AND: Nicholas Ledra and Biosa Technologies Limited, Respondents

BEFORE: Koehnen J.

COUNSEL: Tamara Marcovic for the applicant Alita F. Wolff for the respondent

HEARD: August 11, 2023

ENDORSEMENT

OVERVIEW

[1] These reasons deal with the circumstances in which it is appropriate to award relief during a case conference as opposed to requiring a formal hearing of a motion or an application to award relief.

[2] The issue arises out of a new practice on the Civil List in Toronto to direct most motions and applications of two hours or less to a case conference for resolution rather than automatically scheduling formal hearings for them.

[3] This matter came before me as a case conference. In the underlying application, the applicant seeks the production of annual financial statements of the respondent Biosa Technologies Limited and an order requiring Biosa to hold a shareholders meeting.

[4] The respondents oppose the relief sought and seek an adjournment because of the alleged medical condition of the respondent Nicholas Ledra and seek a timetable to schedule the application.

[5] For the reasons set out below, I decline the adjournment request and grant the relief sought in the application.

Factual Background

[6] The applicant alleges that he is a 20% shareholder and a former director of Biosa. He seeks production of annual financial statements of Biosa since 2020. He says he needs these to determine whether Biosa is up to date with its CRA remittances for the period during which he was a director. He also wants the financial statements to determine how Biosa treated what the applicant alleges is a $50,000 loan he made to Biosa.

[7] The respondents deny that the applicant is a shareholder of Biosa although respondents’ counsel agrees that the applicant was a director. The respondents say the applicant is not entitled to financial statements if he was not a shareholder. The period in which the applicant was agreed to be a director is not clear to me.

[8] The matter first came to me as a scheduling request for a 90 minute application for the relief sought. At the time I declined to schedule the application and directed the matter to a case conference in accord with the new policy on the Civil List in Toronto of directing opposed motions and applications of less than 2 hours to a case conference. I set out the policy as follows in my endorsement directing the parties to this case conference:

The applicant seeks a hearing for a 1.5 hour application.

The new policy of the Civil List is for all opposed short motions and short applications, with the exception of summary judgment motions, appeals from Associate Judges and appeals from the Consent and Capacity Board, to proceed to a case conference before the motion or application is scheduled for an oral hearing.

The parties are notified, in accordance with Rule 50.13(6), that the Case Conference Judge may make procedural orders, make orders for interlocutory relief and give directions.

The overriding object of the case conference is to resolve the issue at hand without any further hearing. To facilitate that, each side should deliver a case conference memo of up to 5 double spaced pages in length setting out their position on the motion and why they should succeed.

The case conference will be an opportunity for the judge to ask questions about the arguments articulated in your case conference memo, it is not an opportunity to repeat the contents of the memo to the presiding judge.

If the judge truly cannot resolve the issue at the case conference, she/he will have the option of directing the motion to proceed in writing or may schedule an oral hearing. Written or oral hearings will, however, be the exception, not the rule.

[9] I also set a timetable for the exchange of case conference memos. The case conference was returnable on August 11, 2023. On August 1, 2023, the respondent asked the applicant for an adjournment of the case conference based on a note from a physician that asserted that the respondent Ledra would be undergoing treatment until “at least January 2024.” I was advised of that request the afternoon before the case conference.

Analysis

[10] This strikes me as the classic case where a case conference should be used to determine the issue instead of a full motion or application hearing. I therefore declined the adjournment and granted the relief requested.

[11] The starting point of the analysis is the backlog of cases on the Toronto Civil list. Dates for motions and applications are assigned in what is referred to as Civil Practice Court which sits every Tuesday and Wednesday. At Civil Practice Court during the week of the case conference, the earliest date available for a motion of less than 2 hours was October 2, 2024. That would impose a 14 month wait on the parties. Waits for motions of over two hours are even longer, with the first date being January 14, 2025, or 16 months from the case conference.

[12] The facts of this case do not warrant a hearing that the applicant has to wait 14 months to argue. He says he is a 20% shareholder of Biosa. To support that claim he says he will rely on the corporate share register and other records that he has obtained from the corporation’s external lawyer which indicate that he is a 20% shareholder. Respondent’s counsel agrees that the corporate lawyer’s records indicate that the applicant is a 20% shareholder. The respondent takes the position that the corporate lawyer’s records are “not authentic.” I was given no further explanation for why the records are not authentic.

[13] I am not prepared to grant the adjournment the respondents request. The respondents have delayed this case from the outset. They evaded service of the application until the applicant brought a motion for substituted service. Between January and April 2023, applicant’s counsel was contacted by numerous lawyers saying they were in the process of being retained. Only when faced with an endorsement requiring them to file a Notice of Appearance by April 28 or risk having the matter proceed by default during the week of May 8 did the respondents file a Notice of Appearance. Even that was delivered three days after the April 28 deadline.

[14] On July 17, 2023, I set this case conference. I asked both clients to be present at the case conference. On August 1 the respondents requested an adjournment. The support for the adjournment is a letter from a Dr. Singh dated August 8, 2023. The full text of the letter is as follows:

To Whom It May Concern:

Nicholas Ledra was seen in my office today with extreme back pain. He will be unable to have Court duty on 9th August due to illness and will need therapy and follow up tests at least until

January 2024.

[15] The respondent could not provide a date to which they wanted to adjourn today’s case conference other than “at least January 2024.”

[16] I note that the “Court duty” referred to was a video conference and not a personal attendance. I also note that the physician’s letter does not explain what Mr. Ledra can or cannot do or how frequently he needs therapy. Although I excused Mr. Ledra from attending the case conference as I had asked, I nevertheless proceeded with the case conference.

[17] I turn then to balance the prejudice that the respondents would suffer if relief were granted against the prejudice to the plaintiff and others in the justice system if the relief is not granted.

[18] The worst prejudice to the respondents is that they share up to 3 years of annual financial statements of Biosa with a former director and have someone attend a shareholders’ meeting as a 20% shareholder who might not be a shareholder if the records of the corporation’s own lawyer are indeed “not authentic” as the respondents claim. The applicant concedes that Ledra holds the remaining 80% of the shares. The respondents say Ledra owns 100% of the shares. In these circumstances, the prejudice to the respondents of allowing a former director who appears to (but might not) own 20% of the shares to attend a shareholders’ meeting or receive financial statements, is minimal.

[19] The prejudice to the applicant is to wait 14 months to schedule an application if it is scheduled today and wait even longer if the scheduling is deferred until in January 2024.

[20] There is also significant institutional prejudice to the justice system. I have already referred to the serious delays on the Civil List in Toronto. Those delays are due to a number of factors. They include a “motions culture” in Toronto where things that should be resolved in a practical way in a short conversation or case conference are subjected to the lengthy formal processes of motions or applications. This delay is then exacerbated by requests for adjournments at the last minute. That means that court time has been set aside but can no longer be used by other litigants.

[21] In addition, delay begets delay. There is a great deal of litigation in which one side has an interest in delay; usually the defendant or respondent. If a party knows they can delay litigation by between 14 and 16 months simply by bringing or insisting on a motion, they often do so. As ever more parties learn of those delays, the number of motions increases, thereby creating even longer delays.

[22] For years, courts, judges and counsel[^1] have commented on the dangerous state of the civil justice system. In in his remarks at the Opening of the Courts in September 2014, former Chief Justice of the Ontario Court of Appeal, George Strathy, stated:

Having been a lawyer and a judge in this province for over 40 years, it strikes me that we have built a legal system that has become increasingly burdened by its own procedures, reaching a point that we have begun to impede the very justice we are striving to protect. With the best of intentions we have designed elaborate rules and practices, engineered to ensure fairness and achieve just results. But perfection can be the enemy of the good, and our justice system has become so cumbersome and expensive that it is inaccessible to many of our own citizens.[^2]

[23] In 2016, Justice David M. Brown of the Ontario Court of Appeal delivered a paper to the Hamilton Law Association entitled “Commercial Litigation in the Next 10 Years: A Call for Reform” in which he stated:

What I call the “Fundamental Goal” of our public civil justice system is the fast, fair and cost-effective determinations of civil cases on their merits. As it currently operates, our public justice system is not achieving the Fundamental Goal. In my view, all three players in the civil justice system [the Bench, the Bar and the Government] need to ditch the old way of doing things and adopt new practices. And we need to do so quickly. Time is not on our side … To stand by as civil courts continue to atrophy risks jeopardizing the health of our democracy, our economy, and our private law, at least in this judge’s assessment. To avoid that risk, we must change our ways and work to re-invigorate our public civil courts.

[24] Supreme Court of Canada Justice Rosalie Abella has stated:

“And yet, with all these profound changes in how we travel, live, govern, and think, none of which would have been possible without fundamental experimentation and reform, we still conduct civil trials almost exactly the same as we did in 1906. With a few hours of instruction, a lawyer from 1906 would feel perfectly at home and today’s courtroom. Could we say that about a doctor from 1906 and today’s operating room?

…we have to figure out what information the judge needs and how best to get it there; and who should be there when he or she gets it; and whether he or she even needs to be a judge.

If the medical profession has not been afraid over the century to experiment with life in order to find better ways to save it, can the legal profession reasonably resist experimenting with old systems of justice in order to find better ways to deliver it? People want their day in court, not their years.

We may find to our surprise, that neither the Rule of Law, nor due process, nor clients, nor lifestyles will be impaired. There is even the possibility that our experiment may in fact improve justice’s performance.”[^3]

But for the introduction of video hearings and electronic documents as a result of the Covid-19 Pandemic, Justice Abella’s comments continue to hold true.

[25] In Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 SCR 87 Karakatsanis J, stated for a unanimous Supreme Court:

“[2] Increasingly, there is recognition that a culture shift is required in order to create an environment promoting timely and affordable access to the civil justice system. This shift entails simplifying pre-trial procedures and moving the emphasis away from the conventional trial in favour of proportional procedures tailored to the needs of the particular case. The balance between procedure and access struck by our justice system must come to reflect modern reality and recognize that new models of adjudication can be fair and just.”

[28] This requires a shift in culture. The principal goal remains the same: a fair process that results in a just adjudication of disputes. A fair and just process must permit a judge to find the facts necessary to resolve the dispute and to apply the relevant legal principles to the facts as found. However, that process is illusory unless it is also accessible — proportionate, timely and affordable. The proportionality principle means that the best forum for resolving a dispute is not always that with the most painstaking procedure.

[56] …The interest of justice cannot be limited to the advantageous features of a conventional trial, and must account for proportionality, timeliness and affordability.

[57] …A documentary record, particularly when supplemented by the new fact-finding tools, including ordering oral testimony, is often sufficient to resolve material issues fairly and justly.”

[26] The Canadian Bar Association has stated:

“…people interviewed… consistently describe the justice system as not to be trusted, only for people with money, arbitrary, difficult to navigate and inaccessible to ordinary people.” [^4]

[27] The World Justice Project is an independent organization that was founded in 2006 as a presidential initiative of the American Bar Association. It conducts an annual survey of the rule of law in countries around the world. In its 2022 survey, Canada ranked 56 out of 140 countries when considering whether the administration of civil justice was free from unreasonable delay. It ranked 68 out of 140 when considering access and affordability of the civil justice system.

[28] These authorities lead me to grant the relief sought. Forcing the applicant to wait 14 months to establish that the corporate share register is authentic in the absence of even a high level explanation of why it is allegedly not authentic would, in the words of Strathy CJO, be an instance of burdening the parties with elaborate procedures that actually impede justice. It would be an example of perfection being the enemy of the good.

[29] In the words of Justice Abella, we must determine what a judge needs and how best to get it there. Do I really need elaborate affidavits, cross-examinations and 30 page factums to adjudicate whether a corporate record is authentic, in the absence of even a high level explanation for why the record is not authentic? Especially when the only consequence of being wrong on the point is that a former director obtains three years of financial statements? In my view, I do not. This case calls for a more practical approach to a practical problem. It does not call for lengthy, drawn out procedures that have the effect not only of delaying the parties in this proceeding but also delaying other litigants, who really do need a more highly refined set of procedures from accessing the courts.

[30] Case conferences that offer relief on a much more limited set of materials are, in the words of the Supreme Court of Canada in Hryniak, a more proportional procedure that is tailored to the needs of the particular case that is nevertheless fair and just.

[31] I am mindful that under Rule 50.13(6) a judge has the power at a case conference to

(a) make a procedural order;

(b) convene a pretrial conference;

(c) give directions;

(d) make an order for interlocutory relief, or

(e) convene a hearing.

[32] Although the respondent did not raise the issue, I am also mindful that one could view the relief I am granting here as a final order given that I am awarding the full relief that the applicant seeks on the application. I am nevertheless prepared to make the order requested for three reasons.

[33] First, in most cases the production of a document or allowing a shareholder to attend a meeting would be considered to be interlocutory relief. It might arguably be final relief here only because of the way in which the notice of application is framed. The peculiarities of drafting should not impose a 14 monthly delay on the applicant. That would be a classic example of a circumstance in which the legal system has become “burdened with procedures that impede the very justice we are striving to protect.” It would make formalistic perfection the enemy of the good.

[34] Second, the relief I am granting can also be seen as a direction. I am directing the respondent to produce documents and hold a shareholders meeting. It does not appear that the term “direction” is defined in the Rules of Civil Procedure.

[35] Third, Rule 1.04 provides:

(1) These rules shall be liberally construed to secure the just, most expeditious and least expensive determination of every civil proceeding on its merits.

(1.1) In applying these rules, the court shall make orders and give directions that are proportionate to the importance and complexity of the issues, and to the amount involved, in the proceeding.

[36] Interpreting the term “direction” on the facts of this case to award the relief sought construes the term liberally to secure the most expeditious and least expensive determination of this proceeding. It also interprets the term in a manner that is proportional to the importance and complexity of the issue. I emphasize the qualification, “on the facts of this case.” There may well we other cases where even a minor difference in the facts may mean that the issue cannot be determined on a case conference but does require a more formal hearing. Whether that is the case in any given situation will depend on the circumstances of the individual case.

[37] At the same time, however, judges must be free to assume greater control of the court process. Until now, the predominant practice in civil matters has tended to be to allow the parties to determine how much court time they want and how they want to use that court time. That makes the court system the only public service in which the user gets to dictate terms of use. That approach is simply not sustainable as the current delays demonstrate. Individual parties are not the stewards of the justice system. Judges are. Judges must have the ability to determine, with the help of the parties, what information the judge needs, how best to get it to the judge and what procedure is proportional to the issue at hand. The parties have had that opportunity here. I am more than satisfied that awarding the relief sought on a case conference here is a fair and just way of determining the issue.

[38] For the reasons set out above I direct the respondents to deliver financial statements of Biosa to the applicant within 14 days. I also direct the respondents to hold a shareholders’ meeting of Biosa within 60 days and to provide notice to Miller of such a shareholder meeting.

Date: August 28, 2023

Koehnen J.

[^1]: See for example: Working Smarter But Not Harder In Canada: The Development of a Unified Approach to Case Management in Civil Litigation; Judiciary Committee of The American College of Trial Lawyers, 2016. Although a report of The American College of Trial Lawyers, it is authored primarily by two Toronto counsel, Kent E. Thomson and Kristin Jeffery. The report also led me to many of the authorities set out below.

[^2]: Quoted by Justice David M. Brown, “Commercial Litigation In the Next 10 Years: A Call For Reform”, delivered at The 11th Annual Current Issues in Commercial Litigation Law Seminar of the Hamilton Law Association on February 24, 2016, at p. 8.

[^3]: “Justice and Literature” First Colloquium of the Chief Justice of Ontario’s Advisory Committee on Professionalism, 2003.

[^4]: The Canadian Bar Association, "Reaching Equal Justice Report: An Invitation to Envision and Act", (Canadian Bar Association, 2013 at 14, online at http://www.cba.org/CBA/equaljustice/secure_pdf/EqualJusticeFinalReport-eng.pdf>