



COURT OF APPEAL FOR ONTARIO

CITATION: Frankie
    Tomatto's Woodbine Inc. v. De Groot, 2015 ONCA 739

DATE: 20151102

DOCKET: C60214

Blair, Hourigan and Brown JJ.A.

BETWEEN

Frankie Tomatto's Woodbine Inc.

Plaintiff (Respondent)

and

Robin De Groot, 2215208 Ontario Inc.,
Evan Karras
and Calvin Htut

Defendants (
Appellant
)

Amandeep Sidhu, for the appellant

Alex Minkin, for the respondent

Heard and released orally: October 28, 2015

On appeal from the order of Justice James F. Diamond of
    the Superior Court of Justice, dated March 9, 2015, with reasons reported at 2015
    ONSC 1545.

ENDORSEMENT

[1]

The appellant, Evan Karras, appeals from the order of Diamond J. dated
    March 9, 2015, dismissing his motion to set aside the noting of default made
    against him on November 29, 2012 and the default judgment by Low J. dated June
    5, 2013 made against him.

[2]

The appellant advances two grounds of appeal.  First, he submits that
    the motion judge erred in finding that the appellant did not bring his motion
    to set aside the default judgment without undue delay. Second, he argues that
    the motion judge failed to consider the potential prejudice to the appellant or
    the respondent in the event the motion to set aside was dismissed or granted.

[3]

A motion judges decision to set aside a default judgment is a
    discretionary one that will attract deference on appeal. It should not be
    interfered with absent an error in law or principle, a palpable and overriding
    error of fact, or unless the decision is so clearly wrong as to amount to an
    injustice:
Mountain View Farms Ltd. v. McQueen
, 2014 ONCA 194, 119
    O.R. (3d) 561, at para. 55.

[4]

The motion judge correctly identified the principles governing the
    motion to set aside as those set out by this court in
Peterbilt of Ontario
    Inc. v. 1565627 Ontario Ltd.
, 2007 ONCA 333, 87 O.R. (3d) 479, and
Mountain
    View Farms Ltd.
.

First Ground of Appeal: Failure to Move Expeditiously to Set
    Aside the Default Judgment

[5]

The motion judge found that the appellant had explained the
    circumstances which led to his default and had presented a triable defence on
    the merits.

[6]

However, the motion judge found that the appellant had not moved
    expeditiously to bring his motion to set aside, nor had he satisfactorily
    explained his undue delay. The appellant submits that the motion judge erred in
    so finding.  We disagree. That finding has ample support in the evidence.

[7]

The appellant was noted in default on November 29, 2012.  Six weeks
    later, the respondent was contacted by a lawyer who advised that the appellant
    had approached him for advice.  Nothing more was heard from the appellant, and
    the respondent obtained default judgment on June 5, 2013.

[8]

On October 24, 2013, the same lawyer served a notice of motion to set
    aside the noting in default on behalf of the appellant and his co-defendant,
    Robin De Groot, returnable in May 2014. The motion judge held that the
    appellant had failed to account for the nine-month delay between learning of
    the noting in default and serving that notice of motion to set aside.

[9]

The motion to set aside returnable in May 2014 did not proceed. The
    motion judge stated it seemingly evaporated.

[10]

On
    July 23, 2014, the appellants present counsel served a new notice of motion to
    set aside the default judgment against the appellant, returnable on October 6,
    2014.  On September 8, 2014, appellants counsel advised that the October
    motion may not go forward because of the inability to obtain instructions
    from the appellant. The motion judge found that there is no evidence offered
    by Karras in his supporting affidavit as to why the Motion Record was not
    served, or why the Motion did not proceed on October 6, 2014.

[11]

The
    appellant finally served his motion record in early December 2014.  The
    appellant then requested a further adjournment of his own motion.  The motion
    to set aside finally went ahead 28 months after the noting in default.

[12]

In
    light of that chronology of events, it certainly was open to the motion judge
    to find that the appellant had not moved expeditiously to set aside the noting
    in default and default judgment.

Second Ground of Appeal: Failure to Consider the Prejudice to
    the Parties

[13]

In
Mountain View Farms
, this court stated, at para. 49, that on a motion
    to set aside a default judgment, in addition to considering the standard three
    factors, a court should take into account the potential prejudice to the moving
    party should the motion be dismissed and the potential prejudice to the
    responding plaintiff should the motion be allowed, as well as the effect of any
    order the court might make on the overall integrity of the administration of
    justice.

[14]

The
    appellant submits that the motion judge failed to consider the respective
    potential prejudice to the parties of any order he made. More specifically, the
    appellant argues that the motion judge, having found the appellant had
    presented a triable defence on the merits, erred in failing to consider the
    prejudice the appellant would suffer if not allowed to put forward such a
    defence at trial.

[15]

We
    are not persuaded by this argument.  The reasons of the motion judge must be
    read as a whole.  The motion judge clearly understood that by dismissing the
    appellants motion to set aside the default judgment, the appellant would not
    be able to defend the claim on its merits.  The motion judge took that factor
    into account as part of his overall analysis.

[16]

The
    appellant submits that any prejudice suffered by the respondent by setting
    aside the default judgment could be compensated by costs.  The motion judge
    effectively addressed that issue when he considered whether setting aside the
    default judgment would be in the interests of justice. He concluded it would
    not. In reaching that conclusion, the motion judge took into account the
    appellants litigation conduct, specifically the appellants continuing breach
    of several court orders relating to the respondents efforts to enforce the
    default judgment in the period before the appellant finally brought his motion
    to set aside before the court.  Accordingly, we see no error by the motion
    judge in his application of this part of the test governing motions to set
    aside default judgments.

[17]

For
    these reasons, we dismiss the appeal.

[18]

Costs
    to the respondent fixed in the amount of $1,925.90, all inclusive.

R.A. Blair
    J.A.

C.W.
    Hourigan J.A.

David Brown
    J.A.


