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Rule 20 guidance sparks debate

|Written By Kendyl Sebesta

One of the parties involved in a landmark Ontario Court of Appeal case on Rule 20 of the Rules of Civil Procedure will be seeking leave to appeal from the Supreme Court of Canada, his lawyer confirmed last week.

The appeal court guidance is vague and discretionary, says Brian Radnoff.

Already, in fact, several lawyers are critizing the court’s guidance on summary judgments as lacking clarity and likely to spark an influx of appeals.

Lerners LLP partner Brian Radnoff, for example, says the guidance is vague and discretionary. “I think the first question we have to ask ourselves is, has this new test really expanded the availability of summary judgments as it was intended to do?” he says. “I have serious doubts that it has.”

But ruling in Combined Air Mechanical Services Inc. v. Flesch last week, Chief Justice Warren Winkler declared “a new departure” and “fresh approach” to the interpretation and application of the amended Rule 20 related to summary judgments.

The government amended Rule 20 last January in a series of changes to the Rules. The goal was to speed up judicial processes and cut costs by allowing judges to weigh evidence, assess credibility, and draw inferences of fact in summary judgment matters.

Yet since it’s implementation, Winkler wrote in Flesch, “it has become a matter of some controversy and uncertainty” with Superior Court judges expressing “differing views on this and other interpretative issues raised by the amendments.”

To create clearer guidelines, the court assembled a five-judge panel to hear five appeals from decisions dealing with the amended rule.

In a key change, the appeal court panel found that motions judges should ask themselves a specific question when determining whether they should send claims to trial.

In its view, “the motion judge must ask the following question: can the full appreciation of the evidence and issues that is required to make dispositive findings be achieved by way of summary judgment, or can this full appreciation only be achieved by way of a trial?”

But the guidance falls short for Radnoff. “It is well written and clear,” he says. “However, the test appears to be entirely discretionary.

That means you could potentially see the exact same cases with the exact same evidence, but because the motions judge is looking at everything and has access to everything now, you could get multiple outcomes.”

According to Radnoff, the appeal court’s guidance could make it more difficult to advise clients in summary judgment matters.

“Now we’re going to start having fights about whether or not they can bring their summary judgment motion forward,” he says.

“It’s far from the optimal situation. In the short term, it could create a lot of summary judgments that will be appealed and won’t save money, although it may be more effective in the long term.”

In Flesch, the matter involved a dispute claiming unlawful competition. Defendants William Flesch, James Searle, and their companies sought a motion for a summary judgment.

They didn’t call any evidence from representatives of the third-party company they’d allegedly engaged in unfair competition with. The motions judge ordered oral evidence from the representative during a cross-examination restricted to one issue, a move that was a point of contention for the plaintiffs.

The appeal panel ruled that the motions judge didn’t err in finding that the third-party company wasn’t “a same or similar business” to and didn’t compete with the plaintiff Combined Air.

The panel also found the motion judge didn’t err in exercising his power to order the presentation of oral evidence.

In Mauldin v. Cassels Brock & Blackwell LLP, the appeal court dismissed Robert Hryniak’s appeal from the summary judgment granted in favour of the plaintiffs known as the Mauldin group.

But it allowed his appeal from the summary judgment granted in favour of the plaintiff in Bruno Appliance and Furniture Inc. v. Cassels Brock & Blackwell LLP.

The case involved a summary judgment motion related to two civil claims of fraud brought by the Mauldin group and Bruno against Cassels Brock, Gregory Peebles, and Hryniak.

The motions judge dismissed the motions for summary judgment against Cassels Brock and Peebles and sent the matters to trial but found Hryniak liable for fraud in each case, a decision he later appealed.

Sarit Batner, a partner at McCarthy Tétrault LLP and counsel for Hyrniak in Mauldin and Bruno, says the decision raises a number of questions. “The central question appears to be, do you have the right kind of case?” she says.

“The judgment appears to provide guidelines on how to sort that out but it also raises the question, is it possible to have full appreciation?”

According to Batner, her client will be seeking leave to appeal from the Supreme Court of Canada. “The court said in respect to the Bruno case: these are the cases that shouldn’t be tried by summary judgment.

Yet there’s a contradiction there because even though the court concluded they couldn’t delve into the case, that it was meant for trial, they tried the case by summary judgment anyway.

“What they did there, and it’s really more of a general question not specifically related to the case, is, although the court set a new power, they didn’t apply it.

So the question to the Supreme Court would be, can a court of appeal decline to apply a new common law to cases before it?”

The ruling also makes it difficult for alleged victims of fraud, say David Alderson and Javad Heydary, who represented the respondents in Mauldin and Bruno.

“The two cases were almost identical, but we received two different judgments,” says Heydary. “Now Bruno has to go through an extensive and expensive trial.”

“He is getting older and after seven to eight years of proceedings, it really is a concern for those who do business in Toronto,” says Alderson.

But another lawyer says the fluid nature of the new guidelines is sometimes necessary.

“If you begin with hard and fast rules, it can be very limiting,” says Tamara Ramsey, an associate at Chitiz Pathak LLP who represented the respondents in Flesch. “In cases where there is a genuine issue, it’s good that the courts have tools like this to move those cases along to trial.”

Allan Rouben, amicus curiae for the Ontario Trial Lawyers Association in the appeal court case, believes the new ruling, while interpreted by some as overly broad, is actually very specific.

“The motions judges will have to look to this for guidance as to what may be suitable,” he says. “It’s trying to say that certain cases are not really suitable for summary judgments if they deal with credibility issues or facts that may be in dispute, for example.

It’s ultimately trying to give guidance as to when the powers under Rule 20 should be exercised.”

For more information, see "Clarity on summary judgment needed: lawyer."

  • John Legge
    Anyone remember 1 hour SCO Trials on Assize? Let alone the 45 minite version before the late beloved Judge Coo?
    Sunnary Judgment; 3 times the work, 1/9th the quality, 1/99th the quality. An absurd, unecessary and wasteful import from the outset. Angels dancing on the head of a pin debates are at least fun. The Ont. CA tried to make sense of an absurdity, and just added to the confusion?

    How did that happen?
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