This was a motion by the Plaintiff to compel productions and attendance at examinations for discovery of an insurance broker after the matter had been set down for trial in which conflicting authorities were reviewed.
Released October 7, 2016 | Full decision [CanLII]
This motion was brought in anticipation of a summary judgment motion to determine issues of coverage. The Plaintiff had set the matter down on December 14, 2011. As a result, leave of the court was required to bring the motion.
Justice Cornell reviewed the two conflicting lines of authority and denied leave.
Two competing tests for granting leave existed in stark conflict with one another. The traditional approach required a substantial or unexpected change in circumstances such that not granting leave would be manifestly unjust. The “broad” approach indicated that leave should also be granted when the proposed interlocutory step is necessary in the interests of justice.
Master Glustein adopted the traditional test in Lugen Corp. v Starbucks, 2014 ONSC 7141. Master Muir, in BNL Entertainment Inc. v. Ricketts, 2015 ONSC 1737, explicitly rejected Master Glustein’s reasoning and applied the “broad” test.
Justice Cornell stated that BNL had been wrongly decided based on a close review of the underlying authorities.
In Hill v. Ortho Pharmaceutical (Canada) Ltd., 1992 CarswellOnt 351, the court framed the traditional test. Of this test, Justice Cornell opined that the phrase, “such that a refusal to make an order under s. 48.04(1) would be manifestly unjust” refers to the requirement for a change in circumstances and does not create a separate basis for granting leave.
Ginkel v. East Asia Minerals Corp., 2010 ONSC 905 is the case held up as authority for the broader approach. Justice Cornell rejected that position. In Ginkel, Justice Perell repeated the traditional test but added the following phrase: “… or the interlocutory step must be necessary to the interests of justice”(emphasis added). After pointing out that all cases endorsed in Ginkel applied the traditional test, Justice Cornell expressed the opinion that the new phrase is simply a restatement of the manifestly unjust requirement, and not the creation of a new category.
The error which established the broad test occurred in ACG Mechanical Structural Security Inc. v. Rizzo, 2013 ONSC 1316. In it, the court misconstrued Justice Perell’s reformulation, identifying two circumstances where leave is available:
- Where there is a substantial or unexpected change in circumstances such that a refusal to grant leave would be manifestly unjust; and
- Where the interlocutory step is necessary in the interests of justice.
In BNL, Master Muir relied upon ACG and other cases applying the broad approach.
In the present case, Justice Cornell found that there was no basis upon which to grant leave. The Plaintiff had known about the potential coverage issues since 2007. The Plaintiff had the opportunity to examine the insurer (Intact) and chose not to do so. The matter had been set down since 2011, and the issue was not raised for 5 years. Therefore leave was denied.
Read the full decision on CanLII
