Piedrahita v. Costin et al. [2023] ONCA 404
Date of Decision: June 06, 2023
Case Summary:
This matter involves a successful appeal following the dismissal of a motion to set aside a Registrar’s Dismissal Order, reported at 2022 ONSC 1850.
Background and Registrar’s Dismissal
The appellant was in a motor vehicle accident on May 11, 2012. She retained counsel, Mr. P. and a Notice of Action and Statement of Claim were issued on May 6, 2014, and May 27, 2014, respectively. Under a former version of Rule 48.15 (1), of the Rules of Civil Procedure, the Registrar provided notice that the claim would be dismissed as abandoned in November 2014 unless a Statement of Defence was filed. The notice was sent to plaintiff counsel, but it did not come to his attention due to clerical error, an extended vacation, and an ongoing physical disability he suffered during a 2010 bicycle accident. The notice was not provided to the defendant.
It is undisputed that the respondent requested a waiver of defense while it investigated the matter on June 24, 2014. Unknown to both parties, the matter was dismissed on December 29, 2014, by the Registrar. Unaware of the dismissal, the respondent requested a waiver of defence again on August 18, 2015.
Due to his medical condition, Mr. P. was required to transfer this matter to another lawyer, Mr. R.P. The respondents served a statement of defence on October 20, 2017, following a demand for the same by Mr. R.P., and examination for discovery was scheduled. Mr. R.P. discovered the dismissal when he tried to file a notice of change of solicitor. The motion to set aside the dismissal was brought in May 2018 but not heard until December 2, 2021.
The Motion to Set Aside the Registrar’s Dismissal
In refusing to set aside the Registrar’s Dismissal, the motion judge, Justice Gibson, stated that "…the recurrent theme throughout this matter has been an inordinate delay on the part of the [appellant] and her counsel." He found there was no satisfactory explanation for the litigation delay or the delay in bringing the set aside motion once the dismissal was discovered. He found the appellant had not shown a positive intent to proceed with the action. As a key consideration, Justice Gibson concluded the appellant had not met her onus to establish no significant actual prejudice to the respondents. He listed prejudice including, that locating witnesses would be difficult, memories may have deteriorated, a defence medical would be significantly delayed, and lack of timely discoveries would “hamper the ability to obtain accurate recollections of the parties”. He also considered the security of legal positions and finality. On these findings, Justice Gibson dismissed the appellant's request to set aside a dismissal order.
The Appeal
On May 30, 2023, the Court of Appeal allowed the appellant’s appeal, and motion judge’s order dismissing the appellant’s motion and the Registrar’s dismissal order were set aside. he primary finding of the appeal court was that “…the motion judge erred by ignoring strong evidence of the absence of any prejudice to the respondents… in all the circumstances of this case. In doing so, he, “…adopted broad assertions of general prejudice… without considering them in the specific context of this case”. The court stated that:
[16] Put simply, the respondents’ claims of prejudice arising from the passage of time and their resulting inability to mount an effective defence are belied by the fact that they proceeded based on an understanding that the action was ongoing and asked that they not be required to file a defence while they took investigative steps for three years after the action was dismissed. It is difficult to conceive how they suffered any actual prejudice in these circumstances.
In essence, as the respondent was unaware of the dismissal and litigating the claim as if the dismissal had not occurred, there is no legitimate claim that the delay to set aside the dismissal caused any prejudice. The motions judge’s considerations regarding finality and security of legal positions were flawed, as clearly the respondent was not secure in a position that the claim had been dismissed prior to serving its defence in October 2017. In addition to the primary finding reading prejudice, the court also found evidence of the appellant’s intention to proceed with the action and steps taken to advance the litigation, particularly after Mr. R.P. took over the action. However, the primary basis for allowing the appeal was the error in relation to the key consideration in setting aside a Registrar’s dismissal order, that of prejudice.
Please click the pdf icon to view the complete case synopsis: 