Civil Litigation
Our former partner, the Honourable Mr. Justice Kurz strikes again
Suing in Superior Court when you should be in Small Claims Court is an abuse of process

Our former and greatly missed partner, the Honourable Mr. Justice Marvin Kurz of the Ontario Superior Court of Justice continues to make important decisions, which have ramifications for the entire Province of Ontario. 

In his July 8, 2021 decision, Canaceede Credit LP v. Schulz, he stopped a common strategy used by collection firms.

Large institutions such as banks rather than dealing with the collection of small debts would simply sell them for pennies on the dollar to another company.  In this case, Canaceede bought debts owed to various banks.  The amounts involved were all far below the $35,000.00 limit of Small Claims Court.  Canaccede, even though it was located in London, Ontario, had a strategy whereby it would commence an action in Milton in the Superior Court of Justice.   Superior Court as one can imagine has far more complicated rules, amongst them, generally not permitting a party to be represented by a paralegal in contrast to Small Claims Court.  Small Claims Court is also strongly tilted in favour of parties litigating on their own behalf in an effort to make justice more accessible. 

Canaceede, taking advantage of the fact that what they were doing was not prohibited would ignore the Small Claims Court alternative and simply sue everyone in Superior Court out of Milton.  One can assume that they chose Milton as they felt it was a jurisdiction in which the backlogs were less than others.  It mattered not to Canaceede where the defendant lived (an option not granted in Small Claims Court) all of their defendants were sued in Milton. 

Canaceede applied for the court’s permission for substituted service.  A plaintiff may ask the court for permission to serve a defendant by an alternate means when they cannot easily be found or served.   Unfortunately for Canaceede, three of such requests all found their way to Justice Kurz’s desk simultaneously. 

Justice Kurz in a lengthy decision decided that this process of suing in Superior Court for matters clearly within the jurisdiction of Small Claims Court was an abuse of process.  The strong supposition was that this course of action was being undertaken to make it difficult for a defendant to fight the claim. 

Canaceede indicated that what they did was extremely common throughout the credit collection industry. 

Justice Kurz in a detailed and lengthy fashion wagged his finger no no no.  Justice Kurz reiterated that the Superior Court has inherent  jurisdiction to manage its own process unless there was a statutory reason for them not to do so. 

Justice Kurz ordered that all three lawsuits be transferred to the appropriate Small Claims Court jurisdiction where the defendants lived.

From Canaceede’s perspective, they are faced with an interesting dilemma and one will have to see how this develops.  If they live with this decision, it is simply made at a trial judge level.  It is persuasive but not binding.  If they appeal and win, then they will have clearly re-established the existing strategy that they have been using successfully.  However, if they appeal and lose, then there will an appellant decision which indeed will be binding upon trial judges and no doubt will come to the wide spread attention of court clerks and judges across the Province and will put an end to this practice. 

As is often the case, judges lead the way in making decisions that really should have been made by the legislature.  This decision alone may very well cause a change in the rules that will bring an end to this collection strategy.  Canaceede admitted that it had presently before the court in Milton 109 similar cases. 

An important decision for defendants of modest means across the Province and the collection industry as a whole. 

A case recently crossed our desks that I simply had to comment on. The Ontario Court of Appeal in the recent case of Rutman v. Rabinowitz set a very high watermark by awarding $700,000.00 in damages for Internet Defamation. The Defendants’ were found to have mounted a lengthy defamatory internet campaign against the plaintiff. Despite the fact that the plaintiff was not able to prove any specific injury to his reputation in the community, the court still hit the defendants on the head with one of the largest defamation awards ever granted.

The court felt that the very nature of internet defamation in which information is widely, instantly and permanently spread needed to attract the court’s heavy handed condemnation.

The case was also interesting in that one of the defendants did not actually partake in the defamation but was aware of it and did nothing to stop and indeed facilitated the process. The court held that one does not have to directly participate in making the defamatory statements to be found to be an equally liable party.

Interesting stuff as the internet, which has already revolutionized all of our lives is magnifying a very ancient area of law and the damages awarded under it.

It was like having the life having sucked out of you. It’s just sliding down a cable. Maybe without a tour group, it’d be kind of fun. Maybe.

Stan, South Park, TV: South Park 16.6 I Should Have Never Gone Zip lining

When Deanna Loychuk and Danielle Westgeest booked their zip line adventure at Cougar Mountain in Whistler, British Columbia, they were eagerly looking forward to their exhilarating cable line expedition through the forest. They made a reservation and followed through, ready to embark on their adventure. They were asked by Cougar Mountain to sign a release and signed it without thinking twice.

We have all done that at one point in time, foolishly, thinking we are invincible and there would be no need to worry about lawsuits and court actions when you could be the next Evel Knievel. They saw the usual title and words release of liability, waiver of claims please read carefully and nonetheless submitted the form before their excursion. They were not forced to go zip lining. No one from Cougar Mountain coerced them to engage in this thrill seeking behaviour.

The ride began and the two women collided as a result of miscommunication between the guides in control of the rides resulting in injuries to both women. Together they sued Cougar Mountain but lost at trial (2011 BCSC 193, 81 C.C.L.T. (3d) 89 and the decision was upheld at the British Columbia Court of Appeal (2012 BCCA 122 (CanLii))

Cougar Mountain admitted the accident was caused by the negligence of their staff but argued that the women had waived their cause of action by signing a valid release. The two Plaintiffs unsuccessfully argued that the release was unenforceable as it was not explained to them, unconscionable, was invalid under the BC Consumer Protection Act due to the deceptive acts of Cougar Mountain and invalid because there was no consideration. The trial judge rejected these arguments and dismissed the action.

Upon appeal, the court found that it was not unconscionable for an operator of a facility at which participants engage in inherently risky recreational activities to require that person to sign a release barring future claims citing the fact that such participation is voluntary, not mandatory.

The Judge held that the release was not unconscionable or deceptive and that the consideration for signing the release was the ability to participate in the activity, whether or not they read or understood the true meaning of the release they were giving.

Although a British Columbia case, the effects of this decision are far reaching and likely to be adopted in Ontario in similar circumstances.

What does this mean for the everyday thrill seeker? It means that one who engages in objectively dangerous activities and signs a release gives up their right to sue if something goes wrong or damage occurs, even if the fault lays with another party.

In other words, when you sign a release, you are contracting out of negligence claims, thereby giving up your common law rights without even perhaps realizing this is the case. It is only in significant circumstances will a release be set aside to restore a cause of action.

The message seems to be very clear if you participate in a risky activity, sign a waiver which has clear terms, is legible and understandable you will have no rights against a party and assume the risks yourself if an injury or damage ensues.

This case should cause people to think twice about whether or not the activity they want to engage in such as zip lining, horseback riding, sky diving or bungee jumping is really worth the risk in the long run.

Your termination of employment may be justified if the employee’s behaviour includes verbal threats of violence or physical misdeeds.

In June 2010, the Ontario government changed Ontario’s Occupational Health and Safety Act. These amendments, which are described as Bill 168, place upon the employer a positive duty to deal with workplace violence and harassment. In a recent arbitrator’s award arising from a union grievance procedure, the arbitrator upheld the dismissal of a problematic employee who had over the years displayed anger management problems. There was no history of physical violence, but threats and intimidating behaviour were repeated. The employee who had twenty-eight years of seniority, was terminated by the City of Kingston after a heated discussion with a co-worker and the employee’s union president about the very issue of the employee’s return to work. The employee, who clearly had no control over her behaviour, eventually ended the argument with the union president by making an oblique death threat. The threat was reported to the City’s management team, who investigated. The City came to the conclusion that there was no choice but to terminate the employee who grieved the termination.

The arbitrator concluded that, the Bill 168 amendments to the Occupation Health and Safety Act have changed the law of the workplace in a significant way. It appears that the law of wrongful dismissal has been amended, though it must be interpreted on the facts of each individual case. Termination is not an automatic knee jerk response to every example of violence or threat, but it is to be strongly taken into account in the determination as to whether or not the dismissal is with cause.

The formula that the arbitrator produced and which will be followed closely in wrongful dismissal actions is, to what extent is it likely that this employee if returned to the workplace, can be relied upon to conduct himself or herself in a way that is safe for others? If the employer cannot reasonably fulfil its obligation to provide a safe workplace under the law, the employer’s justification in terminating the loose canon of an employee will be justified.

Dale Streiman Law LLP regularly provides advice to both employers and employees in a non-union environment on wrongful dismissal matters.

All of Canada, (with the exception of Quebec, which maintains a civil law system) is a common law jurisdiction. The common law is a legacy of the British empire. Spread across the world all of those formerly pink coloured former members of the British empire, continue to maintain a common law system of justice. The United States, with the exception of Louisiana is a common law jurisdiction.

The main feature of a common law judicial system is that it is a body of law at least partially derived from judge made decisions rather than solely from statutes or constitutions.In common law jurisdictions, it is not unusual to see contracts, wills, and other agreements from widely separated parts of the world bear remarkable similarities. I have seen wills drafted in India, South Africa, parts of the Caribbean and all over the United States, bear many resemblances to a Will drafted in Ontario, despite the fact that the laws of wills and estates are provincially distinct.

One of the primary characteristics of the common law is that statutes and laws are passed by the legislature, however, they are relatively general in their provision. It is for judges to interpret these laws to expand upon them and at times, to create them.The common law has long historical roots. Torts, which are a civil action for a wrong, are not a closed set. The courts from time to time create brand new areas of civil wrong which can be sued upon. The most recent in Ontario in 2012 was the tort of intrusion upon seclusion, also commonly known as the invasion of privacy.

Civil law, primarily a derivative of the Napoleonic code, attempts to avoid the lack of clarity and predictability of the common law. The civil law attempts to produce a code which is all encompassing and specific. It is an attempt to create a detailed code in which the answer is available by reading that code rather than seeking a judge’s interpretation.The common law conversely is rooted in judicial history. Previous judge’s decisions are interpreted and followed. The principle of the case is absorbed into the common law. A prime example of common law is that of negligence and the standards of conduct by which persons, companies and indeed even governments are to conduct themselves. When ones conduct crosses the civil line of appropriate and safe behavior and acts in a negligent fashion, this creates a tort which in turn is the basis for a civil law suit. Almost all of these rules are judge made. They remain until trumped by a higher court or the legislature passes a specific law to amend it. An example is the Ontario Occupier’s Liability Act in which the government clarified various rules and set standards. In turn, the Occupier’s Liability Act, contains many general provisions. Those general provisions are interpreted by judges and create new judge made laws which are followed and evolve.

This long winded explanation of the differences between common law and civil law, while legally highly entertaining, is to a degree, one of the reasons why lawyers often cannot give absolute predictions as to how a case will be decided at a particular point in time. The decisions are driven by both the facts and the court’s interpretation of those facts and the law. The law is made both by the Government and Judges. Cases are recorded and are now far more readily accessible in various computer databases. I can assure you that there are few exercises more frustrating then attempting to find an earlier decided case, which contains the very same fact situation as the one presented by your client. One of the most troubling of all such circumstances is when a set of facts that the lawyer is absolutely certain is as common as hot dogs at a baseball game, has never had a recorded case directly on point. It is the lawyer’s task and a reflection of their ability to draw similarities from non similar cases and to use their powers of persuasion to convince a court as to why their client should be successful.