Date: 20021127
Docket: T-1554-99
Neutral citation: 2002 FCT 1230
ADMIRALTY ACTION IN REM AND IN PERSONAM
BETWEEN:
ANGLOFLORA LIMITED
and
K. VAN BOURGONDIEN & SONS INC.
and
ALL OTHERS HAVING AN INTEREST IN THE CARGO
LADEN ON BOARD THE VESSEL "CAST ELK" PURSUANT TO
BILLS OF LADING NOS. ELK157 RT 3249 AND ELK157 RT3251
BOTH DATED AUGUST 28, 1998
Plaintiffs
and
CANADA MARITIME LIMITED
and
CANADA MARITIME LIMITED (BERMUDA)
and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST ELK"
and
THE VESSEL "CAST ELK"
and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST PERFORMANCE"
and
THE VESSEL "CAST PERFORMANCE"
and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST POWER"
and
THE VESSEL "CAST POWER"
and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST PRIVILEGE"
and
THE VESSEL "CAST PRIVILEGE"
Defendants
REASONS FOR ORDER
LEMIEUX J.
A. Background
[1] The Plaintiffs appeal Prothonotary Morneau's September 10, 2002 Order striking out their action on the ground that a term of this Court's order of May 6, 2002 had not been complied with.
[2] On May 6, 2002, Justice Rouleau dismissed an appeal from Prothonotary Morneau's earlier February 5, 2002 decision fixing a timetable for completion of pre-trial procedures but barring the Plaintiffs from discovery of the Defendants because, by their past conduct, they had waived their right to that discovery.
[3] That past conduct involved a breach of a case management order dated January 15, 2001 following a Notice of Status Review ordering the action be specially managed and discoveries completed by March 16, 2001 and a show cause order issued by the Court on June 27, 2001 why the action should not be dismissed for delay because the terms of its January 15, 2001 order had not been complied with.
[4] On the strength of the Plaintiffs' proposed schedule, Prothonotary Morneau again rescheduled discoveries for completion by October 22, 2001 with undertakings on discovery to be answered by November 21, 2001. This schedule was again breached and led to his February 5, 2002 Order.
[5] Justice Rouleau, in dismissing the appeal ordered the following:
It is further ordered that the $1,500.00 costs awarded to the defendant [Canada Maritime Limited] by Prothonotary Morneau in his order of February 5, 2002 together with costs of this appeal which I fix at $2,000.00 are to be paid within 30 days of the date of this Order or the action shall be struck.
[6] On May 16, 2002, the Plaintiffs appealed to the Federal Court of Appeal Justice Rouleau's May 6, 2002 Order but did not seek a stay.
[7] June 5, 2002 went by without the Plaintiffs paying the Defendant's costs.
[8] Canada Maritime Limited's solicitors then wrote to the Court on June 14, 2002 asking for the issuance of a formal dismissal order. Justice Rouleau directed that:
The Defendant is required to serve and file a motion for the issuance of a formal dismissal order. Said motion can be presented to any General Sittings. It is to be noted that I am not seized of this matter.
[9] On June 18, 2002 the Defendant Canada Maritime Limited filed its motion making it returnable July 8, 2002 because the Court was not sitting in Montreal on St. Jean-Baptiste Day nor on Canada Day.
[10] The Plaintiffs filed responding affidavits on July 4 and 5, 2002 but did not seek an extension of time to comply with Justice Rouleau's peremptory or "unless" order of May 6, 2002.
[11] Prothonotary Morneau heard the motion on July 8, 2002 taking it under advisement. As noted, he rendered judgment on September 10, 2002. On July 22, 2002 the Plaintiffs paid the Defendant's court ordered costs.
B. The Prothonotary's Decision
[12] Prothonotary Morneau's decision rests on three conclusions dealing with two issues raised in the Defendant's motion.
[13] The first issue raised by Canada Martitime Limited arose from the relief sought by it in its June 18 motion and the Plaintiffs' responding affidavits.
[14] In that motion, Canada Maritime Limited sought an order from the Court for the "issuance of a formal Dismissal Order" on the following grounds:
1) Plaintiffs have failed to respect the Court's Order of May 6, 2002 pursuant to which Plaintiffs were obliged to pay Defendant's costs in the amount of $3,500 by June 5, 2002 failing which Plaintiffs' action "shall be struck";
2) The said Order of May 6, 2002, was peremptory in nature and given Plaintiffs' failure to comply with same, Plaintiffs' action is, in Defendant's view, dismissed and all that is required is a formal Dismissal Order from the Court to give effect to the said Order.
[15] Prothonotary Morneau expressed the following view at to why Justice Rouleau had directed a motion be filed and served for the issuance of a formal Dismissal Order:
[13] In my opinion, this order by Rouleau J. does not in any way alter the binding force of para. 17 of his May 6 order. In fact, I think that the following can be concluded from the May 6 order and the direction of June 14, 2002. Once the thirty-day deadline expired, that is to say on June 5, 2002, the defendant could regard the plaintiffs' action as having been struck out. If, and in my opinion this is the purpose of the June 14, 2002 direction, the defendant wished a further order by the Court confirming all of this, it would have to proceed by motion since that is the way in which an order is obtained.
[16] He expressed the first issue before him as follows:
[16] It seems to me the only question that arises in the case at bar is whether the plaintiffs in their objection have put forward persuasive reasons why the Court should not simply give effect to the letter and spirit of the May 6 order.
and answered it by finding "I do not think they have".
[17] Dealing with the factual justifications that might explain the non-payment of the costs awarded, he reviewed the affidavits filed by the Plaintiffs in response and found:
[21] These paragraphs, which we set out below, offer few if any details about any efforts made by the plaintiffs since February 5, or even following Rouleau J.'s May 6 order, to see that the costs were paid on time, that is on or before June 5, 2002. Moreover, although the defendant caused the motion at bar to be served on June 18, 2002, the paragraphs set out below clearly indicate by their lack of particulars that the plaintiffs' efforts to have the costs paid were not made until about July 3, 2002, mainly in order to avoid having the motion at bar filed [sic] on July 8, 2002.
[22] In fact, it may well be asked here whether, if it had not been for the defendant's motion served on June 18, 2002, the plaintiffs would have concerned themselves with the costs in the near future.
[23] The paragraphs below in my view indicate a clear lack of attention, or worse, to the February 5 and May 6 orders. . . .
. . .
[24] I accordingly conclude that the plaintiffs have not put forward persuasive reasons in their objection to the motion at bar to prevent the Court giving effect to the letter and spirit of the May 6 order.
[25] In my opinion, therefore, the Court may stop its consideration of the motion at this point so it can give effect to its principal argument and make an order striking the plaintiffs' action, as a consequence of and in accordance with the fact that para. 17 of this Court's May 6 order has not been complied with.
[18] Prothonotary Morneau then dealt with the second prong of Canada Maritime Limited's June 18, 2002 motion, that the action should be dismissed for delay on account of unanswered undertakings. He concluded:
[26] Even if the Court were to proceed with its analysis and examine the situation of the undertakings (23 in number) which had to be carried out for April 26, 2002, in fact late April 2002 in view of the postponement for a few days of the examination for discovery of the plaintiffs' representative, our review of the statements submitted by the plaintiffs in opposition to the motion at bar would lead us to conclude that in accordance with and on the basis of the rules stated in Ferrostaal Metals Ltd. et al. v. Evdomon Corp. et al. (2000), 181 F.T.R. 265, what was done by the plaintiffs in respect of the undertakings must be regarded as "too little too late". In the circumstances of the case at bar, the undertakings which were still not carried out in late April 2002, indeed on July 4 or even at the date the motion at bar was heard, are an additional reason which is in itself a sufficient basis to dismiss the plaintiffs' action for delay.
C. Analysis
1. Standard of Review
[19] The standard of review of a prothonotary's order is that stated by Justice MacGuigan in Canada v. Aqua-Gem Investments Ltd., [1993] 2 F.C. 425 (C.A.) at p. 463:
... discretionary orders of prothonotaries ought not to be disturbed on appeal to a judge unless:
(a) they are clearly wrong, in the sense that the exercise of discretion by the prothonotary was based upon a wrong principle or upon a misapprehension of the facts, or
(b) they raise questions vital to the final issue of the case.15
Where such discretionary orders are clearly wrong in that the prothonotary has fallen into error of law (a concept in which I include a discretion based upon a wrong principle or upon a misapprehension of the facts), or where they raise questions vital to the final issue of the case, a judge ought to exercise his own discretion de novo.
[20] In this case, I must exercise my discretion de novo, since by dismissing the action, Prothonotary Morneau's order raised questions vital to final issue of the case, that is, vital to the result of the case.
2. Discussion and Conclusions
[21] The order made by Justice Rouleau was a peremptory or "unless" order, that is, that action shall be struck unless the costs were paid.
[22] A good deal of the argument before me dealt with what considerations the Prothonotary could take into account when dealing with the motion. The Defendant argued his role was simply to find as a fact Justice Rouleau's order had not been complied with and then issue the dismissal order. Plaintiffs argued the Prothonotary was obliged to examine all of the circumstances and apply the test stated by Justice Hugessen in Baroud v. Canada (1998), 160 F.T.R. 91 (T.D.) namely (1) justification for the delay and (2) what steps are the Plaintiffs now proposing to move matters forward.
[23] It is with good reason Prothonotary Morneau examined the issue of whether the Plaintiffs had provided "persuasive reasons" to explain their non-compliance. First, I believe the intent of Justice Rouleau's directive which required the Defendant to file and serve a motion for a dismissal order was to give the Plaintiffs an opportunity to explain their default. Second, notwithstanding Justice Rouleau's order of May 6, 2002 was peremptory, dismissal is not necessarily automatic. Whether it is or not, in my view will depend on the wording of the peremptory order and the circumstances which include whether the action is under case management (Compare Inmates of Mountain Prison v. Canada, [1998] F.C.J. No. 1064 and Woo v. Canada (National Parole Board), [1998] F.C.J. No. 1248, both rendered by Prothonotary Hargrave).
[24] On the other hand, I do not agree with the Plaintiffs' submission that, in resolving the issue of whether to dismiss on account of non-compliance with the Justice Rouleau's "unless" order, the Prothonotary should have applied the Baroud test. I am of the view the Prothonotary only had to consider the justification for the delay and this is precisely what he did. The Baroud test applies to determine whether a proceeding should continue after a Notice of Status Review has been issued.
[25] The case law holds that the kind of justification required is set at a very high level because the Court is faced with a breach of one of its orders made on an "unless" basis.
[26] As was pointed out by Prothonotary Hargrave in Inmates of Mountain Prison, supra, relying on Caribbean General Insurance Ltd. v. Frizzell Insurance Brokers Ltd. [1994] 2 Lloyds L.R. 32 (UKCA) peremptory or "unless" orders are generally only made when a party has already failed to comply with a requirement, rule or order and the Court is satisfied that the time already allowed is sufficient in the circumstances. He further quoted from Lord Justice Leggatt in that case that "peremptory orders are meant to be obeyed". In that context, the Court of Appeal for the United Kingdom endorsed the proposition that any discretion to relieve a party from the consequences of a breach of a court order should be exercised "cautiously".
[27] In Caribbean General Insurance Ltd., supra, Lord Justice Leggatt also stated:
The Court should not be astute to find excuses for such failure to comply with a peremptory order since obedience to orders of the Court is the foundation on which its authority is founded.
[28] The Courts have in various ways described the standard of justification required in order to obtain relief from non-compliance. In Caribbean General Insurance Ltd., supra, Lord Justice Leggatt applied a double barreled test: the party had to "clearly demonstrate that there was no intention to ignore or flout the order and that the failure to obey was due to "extraneous circumstances" or "if a party can explain convincingly that outside circumstances account for the failure". Under this test, failure to comply must be beyond the control of a party.
[29] Prejudice to the Plaintiffs is not a consideration in determining whether the standard of justification has been met. It is not a relevant factor nor is the fact that the costs have now been paid. The only issue before the Prothonotary is why the Plaintiffs could not have complied with the Court's peremptory order (See Symbol Yachts Ltd. et al. v. Pearson et al. (1996) 107 F.T.R. 295 at paragraph 21 and Ferrostaal Melats Ltd. v. Evdomon Corp. et al. (2000) 181 F.T.R. 265 also at paragraph 21.
[30] In this case, the Prothonotary was not satisfied with the justification advanced by the Plaintiffs to excuse them from non-compliance.
[31] As Justice Nadon, then of the Trial Division, did in Symbol Yachts Ltd., supra, in exercising my discretion de novo it is my conclusion Prothonotary Morneau's decision is correct. Clearly, the affidavits filed by the Plaintiffs are insufficient to meet the standard of justification required by the case law. Moreover the affidavits were short on particulars. They contain no satisfactory explanation why a payment of $3,500.00 could not have been made within the time required. In addition, these affidavits do not spell out when and what efforts were made, within the peremptory period, to comply with Justice Rouleau's order.
[32] For all of these reasons, this appeal is dismissed with costs fixed at $1,500 payable by the Plaintiffs within 30 days.
[33] In the circumstances, I need not deal with the second prong of the Defendant's June 18, 2002 motion namely dismissal for delay on account of outstanding undertakings.
"François Lemieux"
Judge
Montreal, Quebec
November 27, 2002
FEDERAL COURT OF CANADA
TRIAL DIVISION
Date: 20021127
Docket: T-1554-99
ADMIRALTY ACTION IN REM AND IN PERSONAM
BETWEEN:
ANGLOFLORA LIMITED and
K. VAN BOURGONDIEN & SONS INC. and
ALL OTHERS HAVING AN INTEREST IN THE CARGO
LADEN ON BOARD THE VESSEL "CAST ELK"
PURSUANT TO BILLS OF LADING NOS. ELK157 RT 3249
AND ELK157 RT3251
BOTH DATED AUGUST 28, 1998
Plaintiffs
and
CANADA MARITIME LIMITED and
CANADA MARITIME LIMITED (BERMUDA) and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST ELK" and
THE VESSEL "CAST ELK" and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST PERFORMANCE" and
THE VESSEL "CAST PERFORMANCE" and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST POWER" and
THE VESSEL "CAST POWER" and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST PRIVILEGE" and
THE VESSEL "CAST PRIVILEGE"
Defendants
REASONS FOR ORDER
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-1554-99
STYLE OF CAUSE:
ANGLOFLORA LIMITED
and
K. VAN BOURGONDIEN & SONS INC.
and
ALL OTHERS HAVING AN INTEREST IN THE CARGO
LADEN ON BOARD THE VESSEL "CAST ELK" PURSUANT TO
BILLS OF LADING NOS. ELK157 RT 3249 AND ELK157 RT3251
BOTH DATED AUGUST 28, 1998
Plaintiffs
and
CANADA MARITIME LIMITED
and
CANADA MARITIME LIMITED (BERMUDA)
and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST ELK"
and
THE VESSEL "CAST ELK"
and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST PERFORMANCE"
and
THE VESSEL "CAST PERFORMANCE"
and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST POWER"
and
THE VESSEL "CAST POWER"
and
THE OWNERS AND ALL OTHERS INTERESTED
IN THE VESSEL "CAST PRIVILEGE"
and
THE VESSEL "CAST PRIVILEGE"
Defendants
PLACE OF HEARING: Montreal, Quebec
DATE OF HEARING: November 25, 2002
REASONS FOR ORDER : THE HONOURABLE MR. JUSTICE LEMIEUX
DATED: November 27, 2002
APPEARANCES:
Mr. J. Kenrick Sproule FOR PLAINTIFFS
Mr. Darren McGuire FOR DEFENDANTS
SOLICITORS OF RECORD:
The Law Offices of J. Kenrick Sproule FOR PLAINTIFFS
Montreal, Quebec
Borden, Ladner, Gervais FOR DEFENDANTS
Montreal, Quebec