



COURT OF APPEAL FOR ONTARIO

CITATION: DOnofrio v. Advantage Car & Truck Rentals
    Limited, 2017 ONCA 5

DATE: 20170105

DOCKET: C61676

Gillese, Benotto and Roberts JJ.A.

BETWEEN

Anthony DOnofrio, James DOnofrio and Anna
    DOnofrio

Plaintiffs (Appellants)

and

Advantage Car & Truck Rentals Limited,
Jane
    Doe
Anita Marques and Unifund Assurance Company

Defendants (Respondents)

Sabrina Singh, for the appellants

Stephen Ross and Murleen McLean, for the respondents
    Advantage Car & Truck Rentals Limited and Anita Marques

Ali Z. Khan, for the respondent Unifund Assurance
    Company

Heard: November 24, 2016

On appeal from the order of Justice Harrison S. Arrell of
    the Superior Court of Justice, dated August 13, 2015, and from the order of
    Justice Robert B. Reid of the Superior Court of Justice, dated December 30,
    2015, with reasons reported at 2015 ONSC 8084, and, if leave be granted, the
    related costs order, dated March 11, 2016.

Gillese
    J.A.:

[1]

These appeals raise an important question:  are determinations made in a
    summary judgment motion binding on all parties to the proceeding in which the
    motion was brought?  In answering that question, the court must consider the
    effect of a party taking no position on the summary judgment motion.

BACKGROUND IN BRIEF


The Accident and the Action

[2]

In early August 2008,
[1]
Anthony DOnofrio was injured when the van he was driving was rear-ended by
    another vehicle (the offending vehicle).  A young female driver spoke briefly
    with Mr. DOnofrio after the accident but drove off without providing ownership
    and insurance information.

[3]

Mr. DOnofrio had recorded the licence plate number of the other car at
    the scene of the accident. A police investigation traced the licence plate to
    Advantage Car & Truck Rentals Limited (Advantage).  The vehicle
    registered to that licence plate matched the vehicle owned by Advantage and
    identified by Mr. DOnofrio.

[4]

Mr. DOnofrio had a standard automobile policy with Unifund Assurance
    Company.  That policy contained an unidentified motorist provision.

[5]

Mr. DOnofrio and his parents (the Plaintiffs) started an action for
    damages in which it named as defendants: Advantage; Jane Doe, the unknown
    driver of the offending vehicle; and Unifund.  The Plaintiffs included Unifund
    in the action because Unifund would be the responsible payor if there were a
    finding that there was no identifiable defendant.

[6]

Unifund defended and cross-claimed against Advantage and Jane Doe.

[7]

Through Unifunds investigations, it came to believe that Anita Marques
    was the probable driver of the offending car.  Ms. Marques was an employee of
    Advantage at the time of the accident.  At his examination for discovery, Mr.
    DOnofrio confirmed that Ms. Marques was the driver of the offending vehicle.

[8]

The Plaintiffs substituted Ms. Marques for the defendant Jane Doe and
    counsel for Advantage assumed representation for Ms. Marques.

[9]

Advantage/Ms. Marques defended the action based on what I will term the
    Identity Defences.  Those defences were that the identities of the driver
    and/or the owner of the offending vehicle were unknown, as was whether the
    driver was operating the offending vehicle with the owners consent.

The Summary Judgment Motion

[10]

After examinations for discovery were completed, Unifund advised the
    parties that it intended to bring a summary judgment motion for an order
    dismissing the action against it because the identities of the owner and driver
    of the offending vehicle were known (the Summary Judgment Motion).

[11]

In a letter to the parties dated July 2, 2015 (the First Unifund
    Letter), counsel for Unifund referred to some of the facts that supported its
    contention that there were no genuine identity issues requiring a trial.  That
    letter reads, in part, as follows:

Unifund should be released from this action on the basis that
    this is not an uninsured motorist claim.

The plaintiff wrote down the license plate of the other vehicle
    at the scene of the accident. The vehicle registered to that license plate
    matches the vehicle owned by Advantage, and identified by the plaintiff. That
    vehicle was returned to the store a few hours before the subject accident, and
    it was not rented again until a week later. During this time, the vehicle was
    available at the Advantage shop. The keys for the vehicle were available during
    the day in an unlocked box. Ms. Marques confirmed that she would attend at the
    store on a frequent basis, whether working or not, in order to bring her
    boyfriend lunch and to hang out. Odometer readings and the vehicle history
    print out indicate a missing 116 kms between the time the vehicle was brought
    in on August 12
th
, 2008, and when it was rented again on August 19
th
,
    2008.

Advantage has not taken the position that Ms. Marques took the
    vehicle without consent. Advantage did not report the vehicle as stolen,
    despite knowing soon after the accident that there was concern about it. It
    also appears that Advantages employees would take company vehicles out. Ms.
    Marques supervisor signed the vehicle out, including before and after the
    accident.

Finally, we note that the plaintiff attended the examination
    for discovery of Ms. Marques and confirmed that she was the other driver.

[12]

The affidavit of Steven Carlstrom, filed by Unifund on the Summary Judgment
    Motion, placed those facts in evidence before the court. The notice of motion
    also made it clear that Unifund sought to be released because the action did not
    involve an uninsured motorist vehicle claim.

[13]

The Plaintiffs indicated that they would respond to the Summary Judgment
    Motion, if necessary, depending on the responding materials filed by
    Advantage/Ms. Marques.

[14]

By letter dated July 31, 2015, counsel for Advantage/Ms. Marques
    responded to Unifund and advised that those parties would take no position on
    the Summary Judgment Motion on the basis that no costs will be sought against
    them, otherwise they would require an adjournment to file responding
    materials.

[15]

By letter dated August 11, 2015 (the Second Unifund Letter), Unifund
    advised all parties that we will agree to a consent motion to dismiss the
    action without costs against our client.

[16]

Counsel for Advantage/Ms. Marques did not respond to the Second Unifund
    Letter.  Nor did they file responding materials on the Summary Judgment Motion
    or attend at its hearing.

[17]

At the hearing of the Summary Judgment Motion, counsel for Unifund
    advised the court that the order it sought was on consent.  No party other
    than Unifund attended at the hearing of the motion.

[18]

By order dated August 13, 2015 (the First Order), the summary judgment
    motion judge made the order which Unifund sought.  The second paragraph in the
    preamble to the First Order stated that the Plaintiffs took no position on the
    Summary Judgment Motion and that Advantage and Ms. Marques consented to it. 
    The effect of the First Order was to dismiss the action as against Unifund,
    leaving Advantage and Ms. Marques as the sole defendants.

[19]

The full text of the summary judgment motion judges reasons for the
    First Order reads as follows: On consent draft order shall issue.

The First Order Was Based on a Mistake

[20]

Over a month after the hearing of the Summary Judgment Motion, counsel
    for Advantage/Ms. Marques took the position that the First Order contained an
    error because they had not consented to the Summary Judgment Motion.  Rather,
    they had taken no position on the motion.

[21]

Ultimately, all parties agreed that the summary judgment motion judge
    had decided the motion based on a mistaken premise, namely, that all of the
    parties had consented to it.  The parties also all agreed that, in fact, none
    of the Plaintiffs, Advantage or Ms. Marques had consented to the motion, each
    having expressly taken no position on it.

The Clarification Motion

[22]

Counsel for Advantage/Ms. Marques put the Plaintiffs on notice that they
    considered the First Order to have no effect on the Identity Defences and that
    they intended to continue to rely on those defences at trial.  As a result, the
    Plaintiffs brought a motion (the Clarification Motion) to settle the effect
    of the First Order.

[23]

In the Clarification Motion, the Plaintiffs asked for an order
    precluding Advantage and Ms. Marques from raising the Identity Defences at
    trial.  They argued that Advantage and Ms. Marques were estopped from asserting
    the Identity Defences by virtue of the position they had taken on the Summary
    Judgment Motion or, alternatively, by having failed to put their best foot
    forward on that motion.  Alternatively, the Plaintiffs asked that the First
    Order be set aside so that Unifund would continue as a party to the action.

[24]

By order dated December 30, 2015 (the Second Order), the clarification
    motion judge dismissed the Clarification Motion.  The Second Order also made a
    clerical correction to the First Order by amending the wording of the second
    paragraph in its preamble to state that Advantage and Ms. Marques had taken no
    position on the Summary Judgment Motion.

[25]

By order dated March 11, 2016 (the Costs Order), the Plaintiffs were
    ordered to pay costs of the Clarification Motion to Unifund in the amount of
    $6,312.25 and to Advantage/Ms. Marques in the amount of $9,949.72.

The Appeals

[26]

The Plaintiffs appeal all three orders.

THE ISSUES

[27]

The Plaintiffs raise two issues on appeal:

1.

did the
    clarification motion judge err in failing to find that the First Order bound
    Advantage and Ms. Marques such that they are now estopped from raising the Identity
    Defences at trial?

2.

if the answer to
    the first question is no, did the summary judgment motion judge err in
    failing to provide adequate reasons on the Summary Judgment Motion?

ANALYSIS

Issue #1  Did the First Order bind Advantage
    and Ms. Marques?

[28]

The clarification motion judge accepted that the
    Summary Judgment Motion decided the Identity Defences (at para. 29). Nonetheless,
    he found that Advantage and Ms. Marques were not estopped from litigating those
    issues at trial because they did not actively participate in the Summary
    Judgment Motion and they had no right or interest in keeping Unifund in the
    action (at para. 31).  He said that since Advantage/Ms. Marques were disinterested
    in the outcome of the Summary Judgment Motion and did not participate in it,
    they could not be parties for the purposes of estoppel (at para. 31).

[29]

I do not agree.  The Identity Defences which
    Advantage and Ms. Marques seek to raise at trial were directly affected by the
    Summary Judgment Motion.  Consequently, they were interested in the outcome of
    the Summary Judgment Motion.  Further and in any event, as parties to the
    action, Advantage and Ms. Marques were bound by the First Order.  This is so
    regardless of the position that Advantage and Ms. Marques took on the Summary
    Judgment Motion.

[30]

From the outset, the central question in this
    action was whether the Plaintiffs would look to Advantage/Ms. Marques for a
    remedy or to Unifund.  Unifund was named in the action solely because it would
    be the responsible payor if there were a finding of fact that there was no
    identifiable defendant.

[31]

Unifund brought the Summary Judgment Motion
    pursuant to r. 20 of the
Rules of Civil Procedure
, R.R.O.  1990, Reg. 194.  Unifunds position on the motion was that
    Advantage and Ms. Marques were the properly identified owner and driver of the
    offending vehicle and, therefore, the action did not involve an uninsured
    motorist vehicle claim and Unifund should be let out of the action.

[32]

Rule 20.04(2)(a) reads as follows:

20.04(2)
The court shall grant summary
    judgment if:

(a)
the
    court is satisfied that there is no genuine issue requiring a trial with
    respect to a claim or defence;

[33]

The First Order dismissed the Plaintiffs claim
    against Unifund.  As the order was made pursuant to r. 20.04(2)(a), it could
    only have been made if the summary judgment motion judge was satisfied that
    there was no genuine issue requiring a trial with respect to the Identity Defences. 
    If there were such a genuine issue requiring a trial, the motion had to be
    dismissed and Unifund could not have been let out of the action.

[34]

Thus, far from being disinterested in the
    outcome of the Summary Judgment Motion, Advantage and Ms. Marques were directly
    affected by it.  Their ability to maintain the Identity Defences at trial
    depended on the motion being dismissed.

[35]

For the same reason, they had an interest in
    keeping Unifund in the action.   Unifund could only have been let out of the
    action if the summary judgment motion judge was satisfied that the action no
    longer involved an uninsured motorist vehicle claim.  On the record before the
    court (and given that the other parties had not in fact consented to the
    motion), the judge could only have been satisfied of that if he accepted that
    Advantage and Ms. Marques were the owner and driver of the offending vehicle. 
    If there were some other unidentified owner or driver of the offending vehicle,
    the summary judgment motion judge would have had to dismiss the motion. 
    Therefore, the only way that Advantage and Ms. Marques could continue to assert
    the Identity Defences at trial was for Unifund to remain in the action.

[36]

Further and in any event, the First Order and
    its underlying determination that there were no Identity Defences requiring a
    trial was binding on all parties to the action, including Advantage and Ms.
    Marques.  In my view, it is self-evident that either there were genuine
    Identity Defences requiring a trial or there were not.  If there were, the
    Summary Judgment Motion had to be dismissed and the Identity Defences resolved
    at trial.  If there were not, then the Identity Defences could not be pursued
    at trial.  It cannot be both that the Identity Defences were not a genuine
    issue for trial and at the same time remained a genuine issue for trial.

[37]

Furthermore, all of the parties to the action had
    notice of the Summary Judgment Motion.  All had the chance to fully
    participate.  Had Advantage/Ms. Marques wished to retain the right to defend
    the action on the basis of the Identity Defences, they were obliged to contest
    the Summary Judgment Motion and show that there was a genuine issue requiring a
    trial on those matters.  It goes without saying that in so doing, they were
    required to put their best foot forward.

[38]

I would conclude on this issue by responding to
    Advantage/Ms. Marques submission that it was for the Plaintiffs to contest the
    Summary Judgment Motion if they were concerned about the Identity Defences.  I
    reject that submission.

[39]

It was not the Plaintiffs who wished the Identity
    Defences to be pursued at trial  it was Advantage/Ms. Marques.  If Unifund succeeded
    on the Summary Judgment Motion, the trial would have been simplified.  The Plaintiffs
    could then have looked only to Advantage/Ms. Marques for redress but they would
    not have faced the Identity Defences.  If Unifund did not succeed on the
    motion, the Plaintiffs remained in the same position as before the motion was
    brought.  Unifund remained available to claim against in the event that
    Advantage and Ms. Marques were successful in advancing their Identity Defences.

[40]

Therefore, the Plaintiffs understandably took no
    position on the Summary Judgment Motion, although they did make it clear to
    Unifund that if Advantage/Ms. Marques resisted the motion they would respond
    accordingly.

[41]

For these reasons, the Second Order cannot
    stand.  However, although I would set aside the Second Order, I would not
    accede to the Plaintiffs request that this court find that Advantage and Ms.
    Marques are estopped from raising the Identity Defences at trial.  As I explain
    below, there has been no judicial determination of the Identity Defences so
    neither estoppel nor the doctrine of
res
judicata

applies.

Issue #2  The Summary Judgment Motion

[42]

The Plaintiffs framed the second issue as
    arising only if this court found that the clarification motion judge had not
    erred.  As I have explained, I found that he did err.  Nonetheless, because of
    the relief that the Plaintiffs seek, it is necessary to consider the validity
    of the First Order, which flowed from the Summary Judgment Motion.

[43]

The summary judgment motion judge gave a single
    reason for making the First Order: the consent of the parties.  That reason is
     quite simply  wrong.  I hasten to add that no fault for this mistake can be
    laid at the feet of the summary judgment motion judge because he was told by
    Unifund, the moving party, that all parties consented to the granting of the
    order as sought.

[44]

A consent judgment is not a judicial
    determination on the merits of a case but only an agreement elevated to an
    order on consent.   The basis for the order is the parties agreement, not a
    judges determination of what is fair and reasonable in the circumstances:
Rick
    v. Brandsema
, 2009 SCC 10, [2009] 1 S.C.R. 295, at para.
    64.

[45]

With respect, I must disagree with the
    clarification motion judge who treated the fact that Advantage and Ms. Marques
    took no position on the Summary Judgment Motion as the equivalent of having
    consented to the motion and, accordingly, made a clerical correction to the
    First Order to that effect (at para. 17).  As these appeals demonstrate, there
    is a significant and meaningful difference between consenting to a motion and
    taking no position on it.  Had Advantage and Ms. Marques actually consented to the
    Summary Judgment Motion, they could not have purported to resile from its
    underlying determination that there were no genuine Identity Defences to go to
    trial.  It was only because they had taken no position on the Summary
    Judgment Motion that they could purport to be entitled to raise those defences
    at trial.

[46]

Because there was no agreement by the parties that
    the Summary Judgment Motion should be granted and there was no judicial
    determination of the Summary Judgment Motion on its merits, there is no basis
    for the First Order to have been made and it cannot stand.

[47]

In the event that this court determined that both
    the First and Second Orders should be set aside, the Plaintiffs asked that the
    court either (1) dismiss the Summary Judgment Motion or (2) decide the Summary
    Judgment Motion on the merits, including with the appropriate findings of fact.

[48]

I would dismiss the Summary Judgment Motion,
    without prejudice to Unifunds right to renew it.

[49]

It will be recalled that, under r. 20.04(2)(a),
    the court shall grant summary judgment only if it is satisfied that there is no
    genuine issue requiring a trial with respect to a claim or defence.

[50]

As Advantage and Ms. Marques took no position at
    the Summary Judgment Motion, this court does not have the benefit of its
    submissions and evidence on the Identity Defences.  In the circumstances, this court
    cannot be satisfied that there is no genuine issue requiring a trial with
    respect to the Identity Defences nor does it have the parties evidence so that
    it could consider the exercise of its powers under r. 20.04(2.1).

[51]

I acknowledge the validity of the Plaintiffs
    contention that Advantage and Ms. Marques were required to respond to the Summary
    Judgment Motion if they wished to maintain their Identity Defences.  However,
    this court is aware that Advantage/Ms. Marques wish to advance those defences
    and that they mistakenly understood that by taking no position on the Summary
    Judgment Motion, it remained open to them to continue to assert those
    defences.  In the circumstances, in my view, this court is not able to
    satisfactorily discharge its obligations under r. 20.04 and decide the Summary
    Judgment Motion.  Thus, I would dismiss it.

[52]

As the Summary Judgment Motion was never
    adjudicated on its merits, I would dismiss it but without prejudice to
    Unifunds right to renew it.

COSTS

[53]

In the circumstances, the Plaintiffs are
    entitled to their costs of the Clarification Motion on a substantial indemnity
    basis with the lions share of those costs to be borne by Unifund.

[54]

Unifund is the author of this whole unfortunate
    saga.  It is the one who mistakenly told the judge hearing the Summary Judgment
    Motion that all parties consented to the motion.  As the reasons of the summary
    judgment motion judge demonstrate, the First Order was a direct result of him having
    been given that incorrect information.  In that situation, once Unifund learned
    that the parties had not consented to the Summary Judgment Motion, it should
    have done everything in its power to resolve the problem promptly and without
    cost to the other parties. Instead, Unifund opposed the Plaintiffs attempts to
    resolve the problem and obtained a costs order against the Plaintiffs, their
    insured, for so doing.

[55]

These appeals are the Plaintiffs latest
    attempts to rectify the problems created by Unifund.  It is my view that the Plaintiffs
    should not suffer in costs on these appeals, which they would if the court
    followed its usual practice in ordering costs of the appeals on a partial
    indemnity basis.  The entire saga began with Unifunds mistaken advice to the summary
    judgment motion judge that the parties consented to that motion.  Unifunds failure
    to rectify matters once that mistake became known led to the Clarification Motion
    and, ultimately, to these appeals.  Unifund continued to oppose the Plaintiffs
    on these appeals, going so far as to seek costs of the appeals against the
    Plaintiffs on a substantial indemnity basis.

[56]

In the circumstances, I would set the quantum
    of costs of the appeals on a substantial indemnity basis, again with the lions
    share to be paid by Unifund.

DISPOSITION

[57]

For these reasons, I would allow the appeals,
    set aside all three orders and dismiss the Summary Judgment Motion, without
    prejudice to Unifunds right to renew it.

[58]

I would order costs of the appeals in favour of
    the Plaintiffs in the total sum of $24,400, all-inclusive.  Of that sum, I
    would order Unifund to pay $16,400, all-inclusive, and Advantage and Ms.
    Marques together to pay $8,000, all-inclusive.

[59]

Given the Plaintiffs success on appeal, the
    Costs Order automatically falls and they become entitled to costs of the
    Clarification Motion.  I would order Unifund to pay the Plaintiffs all-inclusive
    costs of the Clarification Motion of $4,500, and Advantage/Ms. Marques to pay
    the Plaintiffs all-inclusive costs of $3,000, of that motion.

[60]

No costs were ordered on the Summary Judgment Motion and no party has sought
    costs of that motion in the appeals before this court.  Accordingly, I would
    make no costs order in respect of the Summary Judgment Motion.

Released: January 5, 2017 (LB)

E.E. Gillese J.A.

I agree M.L. Benotto
    J.A.

I agree L.B. Roberts
    J.A.





[1]

On the record, the exact date of the accident is unclear.  It
    appears that it occurred on either August 12 or 13, 2008.


