2023 FC, 2023 FC 1461

cDate: 20231107 Docket: T-631-21 Citation: 2023 FC 1461 Toronto, Ontario, November 7, 2023 PRESENT: Mr. Associate Judge Michael D.

Crinson BETWEEN:COMMODORE'S BOATS LTDPlaintiffandTHE OWNERS AND ALL OTHERS INTERESTED IN THE SHIP "TYEE SHEPARD" (“THE SHIP”), THE SHIP AND TYEEPACIFIC MARINE OPERATIONS LTD.Defendants ORDER AND REASONS [1] This motion arises in the context of an action commenced by the plaintiff Commodore’s Boats Ltd. ("“Commodore”") on April 16,2021, seeking damages from, and other remedies against, the defendants resulting from an alleged breach of a contract between theparties in respect of certain work done for the defendant ship, which is alleged to have been owned at all material times by theDefendant, Tyee Pacific Marine Operations Ltd. ("“Tyee Pacific”").

Tyee Pacific responded with a defence and a counterclaim for interalia the cost of repairs to the Ship, restitution for unjust enrichment and damages relating to the work done and lost income as a result ofCommodore’s work on the Ship. [2] It is in this context that Tyee Pacific has brought the present motion to amend its statement of defence and counterclaim, to compelCommodore, the plaintiff and defendant by counterclaim, to provide information in writing in response to requests made at theexamination for discovery of Commodore’s representative on discovery, and to compel Commodore to disclose additional documents. [3] In its written representations on this motion, Commodore stated that it "“intends to respond to the requests made at the Examinationfor Discovery … but requires more time to do so”".

More specificity was provided at the hearing of the motion when counsel forCommodore committed to providing responses to those discovery requests on an ongoing rolling basis and to complete those responses torequests by April 7, 2023. Tyee Pacific accepted this commitment from Commodore. Accordingly, the relief requested relating to theexamination for discovery and additional documents need not be addressed further in these reasons. [4] The amendments proposed by Tyee Pacific are numerous and are illustrated in

Schedule A to Tyee Pacific’s Notice of Motion asbeing amendments to paragraphs 24 to 28, 30, 37, 38, 40, 45, 50 and 58(a), (b), (c), (d), and (

e) as well as some consequential paragraphrenumbering. While Commodore, in its written representations, was opposed to the proposed amendments en masse that positionchanged at the hearing of the motion. At the hearing, Commodore agreed to all of the proposed amendments with the exception of theproposed amendments in paragraphs 38 and 58(a). These amendments in proposed paragraphs 38 and 58(

a) are aptly described asalleging that Commodore’s work on the Ship was of no value and therefore resulted in a total failure of consideration. The consequentialremedy from these amendments is a claim by Tyee Pacific for the entire amount paid by Tyee Pacific to Commodore rather than thedamages or restitution Tyee Pacific had been seeking to this point in the litigation. [5] Accordingly, the balance of these reasons will address the proposed amendments to paragraphs 38 and 58(

a) that remain in dispute. I. THE LAW [6] Rule 75 of the Rules provides that the Court may, on motion, at any time, allow a party to amend a document, including a pleading,on such terms as will protect the rights of all parties. Upon such a motion to amend, the applicable test is whether it is more consonantwith the interests of justice that the amendment be permitted or that it be denied (Janssen Inc. v.

Abbvie Corporation, 2014 FCA 242, at para. 3) In other words a pleadings amendment should be allowed at any stage of an action for the purpose of determiningthe real questions in controversy, provided that allowing the amendment would not result in an injustice to the other party that is notcapable of being compensated by an award of costs and the amendment would serve the interests of justice (Apotex Inc. v Bristol-MyersSquibb Company, 2011 FCA 34, at para. 4). [7] In determining whether it is more consonant with the interests of justice that the amendment be permitted or that it be denied, thefactors the Court should consider include 1) the timeliness of the motion to amend, 2) the extent to which the proposed amendmentswould delay the expeditious hearing of the matter, 3) the extent to which a position taken originally by one party has led another party tofollow a course of action in the litigation which it would be difficult or impossible to alter, and, 4) whether the amendments sought willfacilitate the Court’s consideration of the true substance of the dispute on its merits to guide the exercise of its discretion.

No singlefactor predominates nor is its presence or absence necessarily determinative, and all must be assigned their proper weight in the contextof the particular case (Janssen Inc. v. Abbvie Corporation, 2014 FCA 242 , at para. 3). [8] However, the requirement that the amendment have a reasonable prospect of success has become a threshold issue: (see, e.g., RemoImports Ltd. v. Jaguar Cars Ltd., 2005 FC 870 at para. 49). The absence of a reasonable prospect of success is a well-established reasonfor a Court to dismiss a motion for leave to amend: (Bauer Hockey Corp. v.

Sport Maska Inc., 2014 FCA 158 (F.C.A.) at para. 16). Theburden is on the amending party to demonstrate such a reasonable prospect of success.

II. ANALYSIS [ 9 ] Neither party included any argument regarding the threshold issue of a reasonable prospect of success of the proposed amendments in their written representations but this motion is not decided upon that issue.

Instead, the motion will be decided upon the factors to be considered in the exercise of discretion and most notable of the factors in this case the timeliness of the motion to amend, the extent to which a position taken originally by one party has led another party to follow a course of action in the litigation which it would be difficult or impossible to alter, and whether the amendments sought will facilitate the Court’s consideration of the true substance of the dispute on its merits. [ 10 ] The timeliness of a motion to amend has multiple facets, which may inform other factors.

For example, delay in bringing a motion to amend after reaching a decision to pursue amendment may inform issues such as whether the amendment goes to the true substance of the dispute. In this case, the moving party argued that the amendments were intended to clarify earlier existing allegations and arose " “based on the opinions found in the expert report of Mr. Braconnier that was served on Commodore on December 5, 2022” " . The proposed amendments were not provided to Commodore until February 6, 2023.

No explanation was offered as to the delay of two months between the service of the moving party’s expert evidence on December 5, 2021 and first informing the responding party of the substance of the proposed amendments. In this respect, the proposal to amend, whether communicated directly to the party or through a motion to amend, was not brought expeditiously or in a timely fashion. [ 11 ] This delay in notifying the plaintiff of the intention to amend the counterclaim was argued by the plaintiff to have led it to have taken a position in the litigation which it would be difficult or impossible to change.

The plaintiff argued that had the proposed amendments been brought to the attention of Commodore earlier, Commodore would have prepared its case differently, particularly with respect to obtaining expert evidence in the action. The position taken by Tyee Pacific at the hearing of this motion to amend was that Commodore should not be permitted to serve any expert evidence addressing the proposed amendments which purportedly arose from Tyee Pacific’s own expert witness.

This position taken by Tyee Pacific with respect to the contentious amendments makes it impossible for Commodore to effectively change its position. Such a position, impeding the ability of Commodore to present its case effectively would result in prejudice to Commodore not capable of being compensated by an award of costs. [ 12 ] Tyee Pacific argued the amendments including those at paragraph 38 and 58(

a) are intended to clarify not to add a new cause of action. Commodore disagreed with this description of these contested amendments. At the hearing of the motion in the context of an inquiry as to the importance of the contentious amendments to identify the true issues in dispute between the parties, Tyee Pacific’s counsel admitted that " “it would not be the end of the world if these amendments were not permitted” " . Thus, it has not been established that these proposed amendments to paragraphs 38 and 58(

a) will facilitate the Court’s consideration of the true substance of the dispute on its merits. [ 13 ] Considering the factors identified in Janssen Inc. supra the Court is not satisfied that, the proposed amendments to paragraphs 38 and 58(

a) are in the interests of justice. Accordingly, those proposed amendments are not permitted. [ 14 ] As Commodore consented too many of the proposed amendments at the outset of this motion and Tyee Pacific was not successful in respect of the proposed amendments to paragraphs 38 and 58(

a) success is divided. No costs shall be awarded. ORDER THIS COURT ORDERS that : 1 . The Defendant may serve and file within 14 days of the date of this Order an Amended Statement of Defence and Counterclaim incorporating the proposed amendments to paragraphs 24 to 28, 30, 37, 40, 45, 50 and 58(b), (c), (d), and (e). 2 . The Defendant’s motion is otherwise dismissed. 3 . There shall be no costs on the motion. “Michael D. Crinson” Associate Judge FEDERAL COURT SOLICITORS OF RECORD DOCKET: T-631-21 STYLE OF CAUSE: COMMODORE'S BOATS LTD v.

THE SHIP "TYEE SHEPARD" AND OTHERS THE MATTER WAS HELD BY WAY OF VIDEOCONFERENCE DATE OF HEARING : MARCH 21, 2023 ORDER AND REASONS: crinson, aj DATED: November 7, 2023 SOLICITORS OF RECORD:

WHITELAW TWINING LAW CORP. Michael Harrison For The Plaintiff BOJM, FUNT & GIBBONS LLP For The Defendants Henry Yu Malcolm Funt