Administrative Dismissals: Trouble for Plaintiff Solicitors

The Issue: As part of the overall case management system by the Court, the administrative dismissal system has created another timeline for busy plaintiff solicitors to manage.

Why This Matters

The advent of administrative dismissals, and recent caselaw illustrating the importance of dealing with these notices (and dismissals) quickly, has led to a spate of challenges by defence counsel when an administrative dismissal is issued by the Court.

Such was the situation in this recent contested motion to set aside an administrative dismissal in the face of an action which was active at the time the administrative order was issued: Cundle v. Concours Mold Inc., 2014 ONSC 255 (CanLII)

There are two types of administrative dismissals for plaintiff’s counsel to worry about: early dismissal for failure to have a Notice of Intent or Statement of Defence filed in response to the Statement of Claim; and an administrative dismissal warning approximately two years after the issuance of the Statement of Claim.

The first instance requires a defence to be filed.

The second instance calls for either a timetable to be filed on consent of all parties or an attendance at a Status Hearing. Plaintiff counsel should prefer a timetable; beware the “show cause” onus that plaintiff counsel must respond to at a Status Hearing.

In the Cundle case herein, the defence contested the motion but curiously refrained from filing responding materials. Typically you would expect responding materials and a cross-examination on affidavits.

In Cundle, the plaintiff had ample evidence of being active and also asking the Registry for a Status Hearing date early and before the administrative dismissal was issued. There was also evidence that one of the defendants had not served its Affidavit of Documents (i.e. not defending the case diligently or more diligently than the plaintiff was prosecuting) while the other parties had.

Judge Healey sets out the law regarding the setting aside of administrative dismissals:

The Law

[19] Rule 48.14(16) permits an order dismissing an action to be set aside under Rule 37.14.

[20] The relevant provisions of Rule 37.14 are:

37.14 (1) Motion to set aside or vary – A party or other person who,

(a) is affected by an order obtained on motion without notice;

(b) failed to appear on a motion through accident, mistake or insufficient notice; or

(c) is affected by an order of a registrar,

may move to set aside or vary the order, by a notice of motion that is served forthwith after the order comes to the person’s attention and names the first available hearing date that is at least three days after service of the notice of motion.

(2) On a motion under subrule (1), the court may set aside or vary the order on such terms as are just.

[21] The Ontario Court of Appeal has summarized the law to be applied when considering whether to set aside a Registrar’s dismissal order in Habib v. Mucaj, [2012] ONCA 880. At paras. 5-7 the court stated:

5. There are four well established factors to consider when deciding to set aside an order to dismiss an action: (i) explanation of the litigation delay – a deliberate decision not to advance the litigation will usually be fatal; (ii) inadvertence in missing the deadline – the intention always was to set the action down within the time limit; (iii) the motion is brought promptly – as soon as possible after the order came to the party’s attention; and (iv) no prejudice to the defendant – the prejudice must be significant and arise out of the delay: Reid v. Dow Corning Corp. (2001), 11 C.P.C. (5th) 80 (Ont. Div. Crt.).

6. No one factor is necessarily decisive of the issue. Rather, a “contextual” approach is required where the court weighs all relevant considerations to determine the result that is just. Here, the Master specifically referenced the proper test and engaged in the weighing exercise. He found that, after the weighing exercise, the just result was to set aside the dismissal order. The Master’s order was discretionary and was made as part of his duty to manage the trial list. The decision, therefore, attracts significant deference from a reviewing court: Finlay v. Paassen, 2010 ONCA 204.

7. Furthermore, on a motion to set aside a dismissal order, the court should be concerned primarily with the rights of the litigants, not with the conduct of their counsel. However, where the lawyer’s conduct is not inadvertent but deliberate, this may be different: Marché d’Alimentation Denis Thériault Ltée. v. Giant Tiger Stores Ltd. (2007), 87 O.R. (3d) 660 (O.C.A.), at para. 28. Here, the plaintiff lawyers’ conduct was found by the Master not to be deliberate. Simply because the appeal judge’s view is that the conduct was “negligent” or “bordering on negligent”, does not mean the Master was not entitled to find the conduct not to be deliberate or not intentional.

Judge Healey allowed the motion and it appears that the contesting defendant is to pay costs to the plaintiff for losing this motion.

Gregory Chang

Toronto Insurance and Personal Injury Lawyer

Source: Ontario Superior Court, Cundle v. Concours Mold Inc., 2014 ONSC 255 (CanLII), dated January 13, 2014.