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A Strong Endorsement of Summary Judgment Motions by the Supreme Court

Posted On: January, 23 2015

The Supreme Court of Canada has paved the way for more Ontario litigants to obtain a final judgment without the time or expense of a full trial.

Last month, the Supreme Court released companion decisions which broaden the circumstances under which judges may entertain motions for summary judgment.  In the recent case Hyrniak v. Mauldin [“Hyrniak”] and Bruno Appliance and Furniture Inc. v. Hyrniak [“Bruno Appliances”] the Court unanimously endorsed an expansive interpretation of Rule 20 of Ontario’s Rules of Civil Procedure, revamping and widening the test for summary judgment motions previously adopted by the Ontario Court of Appeal in the decision Combined Air Mechanical Services Inc. v. Flesch. In Hyrniak and Bruno Appliance, the Supreme Court encourages both motions for summary judgment and tailored summary trials as part of the “culture shift” necessary to provide timely and affordable access to the civil justice system.

2010 amendments to the Rules for summary judgment

Summary judgment motions, governed by Rule 20 of Ontario’s Rules of Civil Procedure, allow courts to resolve some disputes more expeditiously and cost-effectively without the need for a full-blown trial.  However, Justice Osborne’s 2007 Report on the Civil Justice Reform Project highlighted a consensus in the legal community that summary judgment motions were not working to provide access to justice or reduce the backlog of cases in the civil justice system.

In response to the Osborne Report, amendments to Rule 20 were introduced in 2010 which were designed to provide judges with new tools allowing them to adjudicate more cases through summary judgment motions.  The amendments expanded the powers of a motion judge by allowing them to:

  • weigh evidence, evaluate credibility, and draw reasonable inferences from the evidence (rule 20.04(2.1)),
  • hear oral evidence for the purpose of exercising their fact-finding powers (rule 20.04(2.2)), and
  • issue orders and directions to streamline the actions going forward in cases where summary judgment is denied or granted in part (rule 20.05).

The 2010 amendments to the Rules also codified the proportionality principle in Rule 1.04(1.1) which requires that the court apply the Rules in a way which is proportionate to the importance and complexity of the issues in the proceeding.

Background on the Hryniak and Bruno Appliance appeals

Both the Hyrniak and Bruno Appliances cases were matters involving allegations of civil fraud. Both plaintiffs in the Hyrniak and Bruno Appliances allege that they met with Mr. Hyrniak who convinced them to invest several million dollars in his company.  Contrary to the investment strategy Hryniak had described to the investors, the plaintiffs’ funds in both actions were placed in an offshore account and then disappeared.

After bringing actions for fraud against Hryniak, his associate, and his lawyer, both plaintiffs brought motions for summary judgment which were heard together. In both cases, the motions judge granted summary judgment against Hryniak.

A five-judge panel of the Ontario Court of Appeal heard both of Hryniak’s appeals simultaneously, along with three other matters.  In its Combined Air decision, the Court of Appeal set out a threshold test for when a motions judge could use the new evidentiary powers available under Rule 20.04(2.1).  According to the Court of Appeal in Combined Air, the “interest of justice” required that the new powers only be exercised at trial, unless a motion judge can achieve a “full appreciation” of the evidence and issues required to make dispositive findings on a motion for summary judgment.  Thus, despite the amendments to Rule 20 meant to make summary judgment motions more accessible, the Court of Appeal’s decision reflected an ongoing preference for the full trial procedure, especially in cases requiring multiple factual findings.

The Supreme Court’s broad approach to summary judgment motions

Although it dismissed both appeals, the Supreme Court revisited and reformed the test laid out by the Court of Appeal, endorsing a significantly more expansive interpretation of the summary judgment rules.

Writing for the Court, Justice Karakatsanis found that the “full appreciation” test that had been adopted by the Court of Appeal was unduly restrictive.  She offered the following “roadmap” for approaching a motion for summary judgment:

  • When considering a motion for summary judgment, the judge should first determine whether there is a genuine issuing requiring trial based only on the evidence before her, without using the new fact-finding powers.
  • There will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on a motion for summary judgment.  This will be the case when the process:
  1. allows the judge to make the necessary findings of fact,
  2. allows the judge to apply the law to the facts, and
  3. is a proportionate, more expeditious and less expensive means to achieve a just result.
  • If there is no genuine issue requiring a trial, the motion for summary judgment must be granted.
  • If there appears to be a genuine issue requiring a trial, the judge should then determine if the need for a trial can be avoided by using the new fact-finding powers under Rules 20.04(2.1) and (2.2).  The judge may, at her discretion, use those powers, provided that doing so will lead to a fair and just result and will serve the goals of timeliness, affordability and proportionality in light of the litigation as a whole.

Justice Karakatsanis emphasized that the standard for fairness is not whether the procedure is as exhaustive as a trial, but whether it gives the judge confidence that she can find the necessary facts and apply the relevant legal principles so as to resolve the dispute.

In the case of unsuccessful or partially successful motions for summary judgment, the motions judge should then make use of the trial management powers provided under Rule 20.05 as well as the court’s inherent jurisdiction in order to craft a trial procedure that will resolve the dispute in a way which minimizes costs and delay and is sensitive to the effort expended on the failed motion.  In absence of reasons to the contrary, the motions judge should also seize herself of the matter as the trial judge.

This new approach to summary judgment motions harmonizes the case law with the goals of the legislature when it enacted the amendments to Rule 20.  As Justice Karakastanis explained in Hryniak and Bruno Appliances, the amendments were designed to transform Rule 20 from a tool to weed out unmeritorious claims into an alternative model of adjudication.  Trials are no longer the “default procedure”.

 

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