Date: 20020801
Docket: T-1849-01
Neutral citation: 2002 FCT 837
BETWEEN:
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TED AIRD, VIVIEN AIRD, GLENN ALSIP, SHIRLEY ALSIP, SHIRLEY BEATTIE, AL BOSSERT, ROGER BOYCE, PAT BOYCE, JIM COLLINS, OLIVE COLLINS, REG COOPER, PAT COOPER, BILL DAVIES, JESSIE DAVIES, ED DAVIES, ELAINE DAVIES, TONY DAVIS, JACKIE DAVIS, NELL DOORNBOSCH, WILLARD EDWARDS, ETHNA EDWARDS, PATRICIA ELLIOT, ARCHIBALD ELLIS, KURT FENGLER, ANNA FENGLER, LARRY FENGLER, RENATE FENGLER, TOM GLANCY, SHIRLEY GLANCY, JOE GRZYB, DORLES GRZYB, JOHN GUILIANA, BRITT GUILIANA, ED HOLMES, ETHEL HOLMES, HELEN HOLZWORTH, HERB HOLZWORTH, SOPHIE HONCH, KATHY HRISHUK, MIKE HRISHUK, PETER JOHNER, HELEN JOHNER, ERNIE KAHLER, HILDA KAHLER, RON BACON, Executor of the Estate of JOSEPH KOVACS, GERRY McCARTHY, MARILYN McCARTHY, RON McCOMB, ROSE McCOMB, PETER MEISTER, INGRID MEISTER, WAYNE MITCHEL, TRUDIE MITCHEL, DIANE MOORE, JOHN MOORE, BERNIE MORRIS, JOHN MORSE, CATHERINE MORSE, ROY NEFF, DAISY NEFF, JOAN OLLIFFE, JOHN OSTENDORF, NELLIE OSTENDORF, ROXIE PARKER, KEN PATTERSON, JEFFREY PUNSHON, DOREEN PUNSHON, PAT RADBOURNE, ELAINE EBY, DOROTHY REID, LYNNE REYNAN, ED ROGOZINSKY, DELORES ROGOZINSKY, DEREK ROLPH, BETTE ROLPH, DAVID SCHELLENBERG, JOHN SNIJDERS, JANNIE SNIJDERS, RUDY SNIJDERS, JOHN SONNEVELDT, WILLIE SONNEVELDT, TOM SPANN, IRMA SPANN, HARLYN SPROULE, FAYE SPROULE, HENRY STRYD, ADRIANA STRYD, STAN TURNER, HAL WESTON, DOLORES WESTON, DON WHITTAKER, MARYANN WHITTAKER, CATHERINE KNUDSEN, HOWARD KNUDSEN, MARGARET MAKI, LEO MAKI, LORENZ LOHNINGER, HANNELORE LOHNINGER, MARGARET TIBBEN, RALPH CHURCHILL, SANDRA CHURCHILL, JANET REED, CHRIS SEABROOK, MARGARET SEABROOK, FRED HOWSE, PHYLLIS HOWSE, MACE HARRISON, IRENE HARRISON, BUD THOMPSON, MARJORIE THOMPSON, JOHANNA AUBERTIN, GORDON SIDDONS, ROSEMARY SIDDONS, RUSS GRILLS, DIANE GRILLS, BILL MILLER, GERRY MILLER, DEBORAH INNES, ARLEE MISFELDT, JANET MISFELDT, ALAN McLEAN and STANLEY BAXTER and GRACE BALES |
Plaintiffs
- and -
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COUNTRY PARK VILLAGE PROPERTIES (MAINLAND) LTD. |
Defendant
REASONS FOR ORDER
HARGRAVE P.
- (a) This action involves a dispute over both sub-lease rent payments for sites, for manufactured homes, situated upon leased Indian land and related incidental matters. By the present motion the Plaintiffs seek amendment of their Statement of Claim and the provision of outstanding discovery answers and documents.
- (b) The Plaintiffs, for various valid reasons, including economic reasons, wish this fairly straightforward motion for amendment and for discovery answers and documents requested on discovery, to be dealt with in writing. The Defendant, Country Park Village Properties (Mainland) Ltd., whom I shall also call "Country Park" wishes an oral hearing.
ANALYSIS
Oral Hearings of a Motion in Writing
Amendment of the Statement of Claim
Discovery Answers and Documents
- (g) The Plaintiffs examined a representative of Country Park, Mr Norman Eden, on 24 June 2002. Of the 29 requests which were outstanding when this motion was filed, many have now been dealt with, so that only nine remain outstanding. Of those, the material requested pursuant to question 405 is dealing with common area taxes to be provided to the Plaintiffs as soon as counsel for the Defendant receives it.
- (h) While I have had the benefit of much affidavit material, including references in the brief written argument to affidavit material touching upon the outstanding discovery requests, I have not been referred to any basic law by which to determine what are proper discovery requests which must be answered, or documents which must be produced. I will therefore briefly set out some guiding principles.
- (i) The scope for examination for discovery is set out in Rule 240:
| 240. A person being examined for discovery shall answer, to the best of the person's knowledge, information and belief, any question that (a) is relevant to any unadmitted allegation of fact in a pleading filed by the party being examined or by the examining party; or (b) concerns the name or address of any person, other than an expert witness, who might reasonably be expected to have knowledge relating to a matter in question in the action. |
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240.La personne soumise à un interrogatoire préalable répond, au mieux de sa connaissance et de sa croyance, à toute question qui : a) soit se rapporte à un fait allégué et non admis dans un acte de procédure déposé par la partie soumise à l'interrogatoire préalable ou par la partie qui interroge; b) soit concerne le nom ou l'adresse d'une personne, autre qu'un témoin expert, dont il est raisonnable de croire qu'elle a une connaissance d'une question en litige dans l'action. |
As I pointed out in Hayden Manufacturing Co. v. Canplas Industries Ltd. (1998), 83 C.P.R. (3d) 19, at 21 and following, Rule 240 leads to the general proposition that questions exploring relevant issues between the parties, in order to deal with allegations which have not been admitted, are proper. As I also pointed out, in my discussion of this area, the leading modern case in this Court, dealing both with questions asked on discovery and documents sought on discovery is still Reading & Bates Construction Co. v. Baker Energy Resources Corp. (1988), 25 F.T.R. 226 at 230, where six general principles governing the scope of examination for discovery are set out. These six principles, which govern the scope of discovery, are still valid not withstanding that the case pre-dates the present Federal Court Rules, are paraphrased at page 23 in Hayden Manufacturing (supra):
The documents to which parties are entitled are those which are relevant. Relevance is a matter of law, not discretion. The test to apply, in determining relevance, is whether information obtained may directly or indirectly advance one party's case, or damage that of the other party.
- (xii) Discovery is confined to matters relevant to the facts which have been pleaded, rather than to facts which a party proposes to prove and thus relevance, in the context of discovery, limits questions to those that may prove or disprove allegations of fact which have not been admitted.
- (xiii) A court should not compel answers which, although perhaps relevant, are not likely to advance the party's legal position.
- (xiv) Before requiring an answer to a discovery question, the court should weigh the probability of the usefulness of the answer against the time, trouble, expense and difficulty which might be involved in obtaining it: "One must look at what is reasonable and fair under the circumstances . . ." (loc. cit.).
- (xv) Fishing expeditions undertaken through far-reaching, vague or irrelevant questions are to be discouraged.
These guidelines or limitations on the reasonable bounds of discovery may be supplemented through glosses on the principles provided by additional case law in the area, including that where a question is borderline I should exercise my discretion in favour of answering such a question: Scientific Games Inc. v. Pollard Banknote Ltd. (1997), 73 C.P.R. (3d) 461at 492. Further, Rule 241 places an obligation upon a person being examined for discovery to inform himself or herself by making enquiries of present and former officers, servants, agents and employees who might have knowledge relating to any matter in question. Finally, production of document is not measured in terms of great relevance or marginally relevance, for even a marginally relevant document must be produced. Indeed, I would specifically note the view of Master Funduck in the Clif-Den Holdings Ltd. v. Automated Concrete Ltd. (1986), 73 A.R. 236, an Alberta case, in which he observes that "it is not uncommon for documents to be put in evidence which contain some things which are irrelevant". However, none of these guidelines should be taken to allow such broad discovery as to make the process into an unaffordable luxury involving protracted and far-reaching discovery of marginal usefulness. Rather the guidelines place a limit on discovery. In referring to the above cases on the scope of discovery I have not overlooked the case which provides the foundation, the Peruvian Guano case: I will cite and refer to that case in due course. I now turn to a consideration of each of the outstanding requests.
Pre-sub lease Representations
16. Question 88 deals with enquiry to be made from those acting on behalf of the Defendant, before the execution of sub-leases, as to whether they told the Plaintiffs that a four-year assessment, or rather a re-assessment, would never be higher than the cost of living adjustment and/or that the four-year assessments would result in minimal increases. The wording of the answer has been, I believe, misunderstood by the Plaintiffs. The answer, to paraphrase it, is that none of the field representatives or staff, with whom Mr Eden has been able to review the matter, indicated to him that they made such statements to any of the Plaintiffs. It may be that Mr Eden has not cast him net of inquiry broadly enough, but that is not the issue taken by the Plaintiffs. The response to question 88 is thus adequate.
Delivery of Disclosure Statements
17. Question 158 required enquiry, of anyone acting on behalf of the Plaintiffs, as to whether they had specific recollection of giving a disclosure statement to any of the Plaintiffs and if so to whom and when. The answer does not indicate that any enquiries were made. To that extent the answer is deficient. Mr Eden shall make further enquiries.
Appraisal
18. Question 167 is a request to provide an appraisal which was received from Indian and Northern Affairs in 1996, in connection with negotiating the head lease rent. The Defendant responds that it does have an appraisal of 12 March 1996, prepared by ARC Apprisal Ltd. for Public Works and Government Services Canada, but that it has not been produced as the issue is the Fair Market Rent under the sub-leases and, I believe, by extension, that the appraisal in question was related to the head lease. The Plaintiffs' response is that they should be entitled to full production, including this appraisal, for to understand the rental increase under the sub-leases in 1996, they must know the contemporary head lease rent increase, that is, while the increases in sub-lease and head lease payments might not be the same, they should reflect each other.
19. The appraisal falls within a category of those documents which may be at least marginally relevant and which directly or indirectly may enable a party to advance his or her own case, or damage the case of an adversary, or which might fairly lead to a train of enquiry which could have either of these consequences and here I would refer to the nub of the decision in Compagnie Financiere du Pacique v. Peruvian Guano Co. (1882), 11 Q.B.D. 55 (C.A.) at pages 62 and 63 which began with the proposition that a party swearing an affidavit of documents "... is bound to set out all documents in his possession or under his control relating to any matter in question in the action." There Lord Justice Brett rejected a narrow approach to the doctrine of production of documents and then went on to say:
| The doctrine seems to me to go farther than that and to go as far as the principle which I am about to lay down. It seems to me that every document relates to the matters in question in the action, which not only would be evidence upon any issue, but also which, it is reasonable to suppose, contains information which may - not which must - either directly or indirectly enable the party requiring the affidavit either to advance his won case or to damage the case of his adversary. I have put in th words "either directly or indirectly," because, as it seems to me, a document can properly be said to contain information which may enable the party requiring the affidavit either to advance his own case or to damage the case of his adversary, if it is a document which may fairly lead him to a train of inquiry, which may have either of these two consequences ...
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The concept in Peruvian Guano, advancing one's own case or damaging the case of an adversary, is analogous to Federal Court Rule 222(2) which requires production of any document, as relevant, either where a party intends to rely upon it or where it "... tends to adversely affect the party's case or to support another party's case.". The appraisal is to be produced.
Instructions to Fortin Appraisals
20. Question 270 deals with a letter of instruction sent to Fortin Appraisals on 11 January 2000, a number of months before this action was commenced in the fall of 2001. There is no indication whether the letter was from the Defendant to the appraiser, or from Defendant's counsel to the appraiser. Rather the Defendant's position is that they will produce the letter if counsel for the Plaintiffs will produce a letter of instruction sent by counsel to an expert apparently retained on behalf of the Plaintiffs. I do not see the connection.
21. The Defendant does not say that the letter for which some form of privilege is, I think, being claimed, was in contemplation of litigation. Indeed, the letter was apparently sent before the March 2000 rent was set, an event which apparently triggered the litigation.
22. The letter is to be produced, for the Defendant has not satisfied the burden of establishing facts to show either that the letter was produced with the litigation in mind, or was produced for the dominant purpose of contemplated litigation, with the prospect of litigation being reasonable: these are criteria for privilege set out in Commercial Union Assurance Co. plc v. M.T. Fishing Co. (1999), 162 F.T.R. 74 at 75 - 76, affirmed (1999), 244 N.R. 397 (F.C.A.). Thus the letter instructing the appraiser must be produced.
Financial Statements
23. Question 383 requests production of the financial statements of Country Park for the years 1994 to date, or alternatively, 1997 to date. The Plaintiffs wish to see these documents in order to determine the amount which the Defendant had spent for Additional Rent charges as expenses, this coming within the paragraph 26 plea in the Statement of Claim that the Defendant has overcharged for additional rent.
24. The Defendant's initial letter of refusal is so cryptic that, without material with which I have not been provided, it makes no sense. However, in brief written argument the Defendant says that it had already provided or agreed to provide some "source documents" and cost summaries for the period 1 June 1998 through 31 May 2002, but that there is no provision in the sub-lease for production of any financial statements, production of such material going well beyond the accounting to which the Plaintiffs are entitled under their sub-leases. Indeed, the Defendant goes on to say that the Plaintiffs are not entitled to any unnecessary incursion into private business affairs.
25. The Defendant's position overlooks a basic concept that the test for production is simply relevance, not discretion. That other documents have been produced, or that the sub-leases do not call for the production of financial statements, for the purposes of litigation, or otherwise, is irrelevant. The Defendant does not have the discretion to refuse production of a relevant document. The material shall be produced.
Tax Returns
26. Question 384 deals with production of the Defendant's tax returns for the years 1994 to date, or alternatively, 1997 to date. The former date is relevant in that I have allowed the amendment to the statement of claim going back to 1994. The Plaintiffs wish to review the tax material to determine what the Defendant has been spending and reporting as expenses since 1994. I will not repeat the analysis which I have set out above for financial statements, however that analysis also applies to the tax returns, which shall be produced.
Verification of Incidental Costs
27. Question 384 also deals with production of source documents from 1994 to date, as a means of demonstrating the Defendant's expenses for general maintenance, insurance, utilities, garbage pickup, on-site management and common area taxes. Again, these docents would appear to be relevant, much as the financial statements and tax returns of the Defendant and shall be produced.
Budget for Common Area Taxes
28. Question 408 deals with a budget figure for common area taxes. The response from counsel for the Defendant is that he is awaiting a response from the client, but is not satisfied that any enquiries, before 1 January 1997, are relevant. Common area taxes are at issue. In that the Statement of Claim now goes back to 1994, that material going back to that date, is relevant and to be produced.
Costs
29. The Plaintiffs having been almost entirely successful, they are entitled to the taxable costs of this motion, payable at the end of the day.
(Sgd.) "John A. Hargrave"
Prothonotary
Vancouver, British Columbia
1 August 2002
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-1849-01
STYLE OF CAUSE: Ted Aird et al. v. Country Park Village Properties (Mainland) Ltd.
PLACE OF HEARING: Motion in writing
DATE OF HEARING: -
REASONS FOR ORDER BY: Hargrave P.
DATED: 1 August 2002
APPEARANCES:
SOLICITORS OF RECORD:
Robertson Downe & Mullally FOR PLAINTIFFS
Abbotsford, British Columbia
Boughton Peterson Yang Anderson FOR DEFENDANT
Vancouver, British Columbia