Baur v Winners Date:, 2014 BCPC 254

Citation: Baur v Winners Date: 20140929 2014 BCPC 0254 File No: C67700 Registry: Nanaimo IN THE PROVINCIAL COURT OF BRITISH COLUMBIA BETWEEN: ALLISON BAUR CLAIMANT AND: WINNERS MERCHANTS INTERNATIONAL L.P. DEFENDANT REASONS FOR JUDGMENT OF THE HONOURABLE JUDGE GOUGE Appearing in person: Ms. Baur Counsel for the Defendant: D.W.P. Moriarty Place of Hearing: Nanaimo , B.C. Date of Hearing: July 22, September 25, 2014 Date of Judgment: September 29, 2014

A corrigendum was released by the Court on October 20, 2014. The corrections have been made to the text and the Corrigendum isappended to this document. [1] The Defendant applies to set aside a default judgment granted by this Court on October 28, 2013. [2] Rule 17(2) of the Small Claims Rules BC Reg 261/93 provides: A judge may cancel a … default order if (

a) the order was made … for failing to file a reply, and (

b) the party applies … and attaches to the application an affidavit containing (

i) the reason the party did not file a reply …. (ii) the reason for any delay if there has been delay in filing the application, and (iii) the facts that support the claim or the defence. [3] On such an application, the question is whether it is necessary to set aside the default judgment in order to prevent amiscarriage of justice: Lin vs Tang (1997) (BC CA), 37 BCLR (3d) 325. In addressing that question, I am required toconsider: (

i) whether the Defendant was guilty of wilful default in failing to respond to the Notice of Claim (the originating process inthis court) within the time allowed by the Small Claims Rules; (ii) whether the Defendant has applied as soon as reasonably practicable toset aside the default judgment; and (iii) whether the Defendant has demonstrated a defence worthy of investigation at trial: CanadaMortgage & Housing Corp vs Balla 2008 BCSC 1352.

As I construe the authorities, those three factors, individually or collectively, arenot to be regarded as determinative, but rather as relevant to the fundamental question; i.e. whether a miscarriage of justice would resultif the application were refused: British Columbia vs Ismial 2007 BCCA 55; [2007] BCJ #162 @ paragraph 11. [4]

Section 2 of the Small Claims Act RSBC 1996, c 430 provides: 2

(1) The purpose of this Act and the rules is to allow people who bring claims to the Provincial Court to have them resolved and to haveenforcement proceedings concluded in a just, speedy, inexpensive and simple manner. In Deline vs Whittle 2002 BCCA 662; [2002] BCJ #2796 @ paragraph 12, Madam Justice Saunders commented on the importance ofsuch provisions in the context of an application to set aside a default judgment. [5] Ms. Baur alleges that she slipped and fell on a wet floor in the Defendant’s store in Nanaimo, British Columbia on May 19,2012, and suffered personal injuries as a result.

She issued her Notice of Claim on November 1, 2012. She telephoned to theDefendant’s head office in Ontario, and asked where she should send the Notice of Claim to bring it to the Defendant’s attention. Shewas given an address in Ontario, one of the Defendant’s offices, and sent the Notice of Claim to that address. The Defendant does notchallenge Ms. Baur’s evidence about the telephone enquiry, nor that she sent the Notice of Claim by registered mail to the address shewas given. [6] Mr.

Moriarty’s initial position was that the default judgment should be set aside ex debito justiciae because the Notice of Claimwas not properly served. He founded that position on the argument that a limited partnership can be served only at its registered office inthe Province, being in this case the offices of Mr. Moriarty’s firm in Vancouver. To his credit, Mr. Moriarty did not press that argument.

I observed, and he concedes, that, if a plaintiff enquires of a defendant how the latter ought to be served, and the latter chooses torespond, service in accordance with the response is good service - the defendant is estopped from disputing the validity of serviceeffected in accordance with the defendant’s express instructions. [7] Ms. Nicolini is the employee of the Defendant responsible for receiving and administering claims like that of Ms. Baur. Shedeposes that, after diligent enquiry, she has been unable to discover what became of Ms.

Baur’s Notice of Claim after it was delivered tothe Defendant’s Ontario address. It was not brought to her attention, as it ought to have been if the Defendant’s normal procedures hadbeen followed. It was somehow lost or mislaid, but there is no information as to how that occurred. Ms. Nicolini first learned of Ms.Baur’s claim on July 10, 2014, when notice of a payment hearing was delivered to the Defendant. She promptly instructed counsel toapply to set aside the default judgment. [8] In this case, there is no evidence from which I could infer wilful default on the part of the Defendant.

I accept that an error wasmade by employees of the Defendant, as a result of which Ms. Baur’s notice of claim failed to come to Ms. Nicolini’s attention untilJuly, 2014. No doubt, some employee of the Defendant was careless. However, mistakes of that kind are often made, particularly inlarge organizations, and I am not prepared to draw an inference of inexcusable carelessness from the evidence in this case. Theapplication to set aside the default judgment was made promptly after Ms. Nicolini learned of the existence of the claim. [9] It appears that Ms.

Baur complained to the Defendant’s employees on-site when she fell on May 19, 2012. Ms. Nicolini hasproduced two incident reports and a witness statement, each prepared by one of the Defendant’s employees on that date, and has alsoreproduced electronic entries made contemporaneously in an electronic customer service log maintained by the Defendant. Each ofthose is to the effect that, upon observing Ms. Baur lying where she fell, the employees examined the floor for any sign of moisture or

any slippery substance, and that they observed none. There may be an issue as to the admissibility of those documents as business records (because they appear to have been prepared at a time when a dispute could be foreseen), but they may be used as aides memoire if the employees are called to testify at trial. [ 10 ] If the statements of fact in the incident reports and witness statements tendered by the Defendant are true, the Defendant has a meritorious defence to this action. It would have been preferable to tender affidavits from the authors of those documents, so as to allow Ms.

Baur the opportunity to cross-examine on those affidavits. However, I am mindful that the monetary limit of this Court’s jurisdiction is $25,000, and that the process of this court must allow the adjudication of disputes at a cost which is proportionate to the amount in issue. With that in mind, I accept the documents tendered as sufficient to demonstrate the existence of a defence worthy of investigation at trial. [ 11 ] The troublesome issue in this case is delay. In considering that issue, I do not think that I should confine myself to delay caused by wilful default on the part of the Defendant.

The delay may be the result of excusable carelessness. However, the facts remain that: (

i) Ms. Baur suffered her injury more than two years ago; (ii) if I set aside the default judgment, the claim will not be tried before next spring, three years after her injury; and (iii) no part of the delay is the fault of Ms. Baur. If I set aside the default judgment, this claim will not be adjudicated in a “… speedy, inexpensive and simple manner …”. [ 12 ] In the end, it is not possible to do perfect justice to both the Claimant and the Defendant. If I set aside the default judgment, the Claimant will be denied prompt access to justice.

If I don’t, the Defendant will be denied a trial on the merits of a defence which might otherwise succeed . A delay of three years between the date of the incident and the date of trial, in a case where no part of the delay is attributable to the conduct of the Claimant, is very close to boundary at which the just course of action would be to sustain the default judgment, even in a case where wilful default on the part of the Defendant is not demonstrated and there appears to be a meritorious defence.

However, I do not think that the boundary has been crossed in this case, and I allow the Defendant’s application accordingly. The default judgment will be set aside. [ 13 ] Rule 20(6) of the Small Claims Rules provides: A judge may order a party or witness whose conduct causes another party or witness to incur expenses to pay all or part of those expenses. I think it only fair to direct that the Defendant reimburse Ms. Baur for: (

i) any filing fees which she paid for the application for a default order and the notice of payment hearing; (ii) her actual, out of pocket expenses incurred to attend at the hearings on October 28, 2013 and July 22 and September 25, 2014; (iii) any wages which she actually lost by reason of attendance at court on those three days. Those amounts are to be assessed by the Registrar if Ms. Baur and Mr. Moriarty are unable to agree on the amounts, and are payable forthwith upon assessment by the Registrar. September 29, 2014 ___________________________ T.

Gouge, PCJ CORRIGENDUM - Released October 20, 2014 In the Reasons for Judgment dated September 29, 2014, the following change has been made. [ 14 ] Paragraph 9 shall be amended to read as follows: [9] It appears that Ms. Baur complained to the Defendant’s employees on-site when she fell on May 19, 2012. Ms. Nicolini has produced two incident reports and a witness statement, each prepared by one of the Defendant’s employees on that date, and has also reproduced electronic entries made contemporaneously in an electronic customer service log maintained by the Defendant.

Each of those is to the effect that, upon observing Ms. Baur lying where she fell, the employees examined the floor for any sign of moisture or any slippery substance, and that they observed none. There may be an issue as to the admissibility of those documents as business records (because they appear to have been prepared at a time when a dispute could be foreseen), but they may be used as aides memoire if the employees are called to testify at trial.