



COURT OF APPEAL FOR ONTARIO

CITATION: Turbo Logistics Canada Inc. v. HSBC Bank Canada,

2016 ONCA 222

DATE: 20160323

DOCKET: C58073

Strathy, C.J.O., Lauwers and Benotto JJ.A.

BETWEEN

Turbo Logistics Canada Inc., 2163960 Ontario
    Inc.,
George Perlin, Alex Ber
and 2192370 Ontario Limited

Plaintiffs (Appellants)

and

HSBC Bank Canada

Defendant (Respondent)

Jasdeep Singh Bal and Daniel Perlin, for the appellants

Matt Saunders and J. Brian Casey, for the respondent

Heard: March 14, 2016

On appeal from the judgment of Justice Ruth E. Mesbur of
    the Superior Court of Justice, dated November 18, 2013.

Strathy C.J.O.:

[1]

The appellants were found liable at trial for damages in excess of $10
    million for fraudulent misrepresentation, negligent misrepresentation, conversion
    and conspiracy in connection with loans made to their company by the respondent
    bank. The trial judge found that the appellants had fraudulently submitted
    false information to the respondent in order to obtain the loans.

[2]

During oral submissions, counsel confirmed that the sole ground of
    appeal being advanced before us was that the trial judge erred in refusing an
    adjournment to enable the appellants to retain new counsel.

[3]

The appellants acknowledge that the decision to grant or refuse an
    adjournment is discretionary and attracts deference from an appellate court.
    They say, however, that the trial judge failed to consider all the relevant
    circumstances, with the result that the decision is contrary to the interests
    of justice and the trial judgment should be set aside.

A.

BACKGROUND: the adjournment request and the trial

[4]

The events at issue in this proceeding occurred in 2007. The appellants
    commenced the action against the respondent in 2008, claiming declarations that
    they were not liable on their guarantees. The respondent counterclaimed,
    asserting it would not have advanced the funds to the debtor, or continued to
    finance it, but for the appellants fraudulent statements concerning its
    financial worth.

[5]

The trial was scheduled more than a year in advance, to commence in
    September 2013. The date was set to accommodate the schedule of the appellants
    counsel.

[6]

About three weeks before trial, the appellants served notices of
    intention to act in person. It is apparent from their own evidence that they
    were hoping to settle the case. When their offer of settlement was not
    accepted, their lawyer discussed the costs of proceeding to trial. They were
    unwilling to pay him to do so. He insisted on getting off the record and they each
    served a Notice of Intention to Act in Person. Their lawyer signed the form
    confirming that he had explained its purpose to the appellants.

[7]

At or shortly before trial, the appellants stated that they would not be
    pursuing their claim and the trial was to proceed on the respondents
    counterclaim.

[8]

A few days before trial, the appellants advised the respondents counsel
    that they would be seeking an adjournment and that they hoped to retain new
    counsel. They appeared at the opening of trial and requested an adjournment for
    that purpose. Mr. Perlin explained that up to the last minute they had hoped
    to settle the case. Mr. Ber produced a doctors letter stating that he was
    being treated for depression and could not participate in legal proceedings
    until his condition improved. It appears that his condition was long-standing
    and that he obtained the letter on the same day he filed the Notice of
    Intention to Act in Person. The respondents opposed the adjournment request.

B.

the trial judges reasons

[9]

After hearing the parties submissions and canvassing the respondents
    counsel and both appellants concerning the anticipated issues and evidence in
    the trial, the trial judge refused the adjournment. She reasoned as follows:

·

the trial had been scheduled as a long trial about a year earlier;

·

the appellants had commenced the lawsuit and it was their
    obligation to proceed expeditiously;

·

if the trial was adjourned, it would probably be close to a year
    before it could be re-scheduled;

·

it was impossible to predict what might occur in the interim and
    witnesses memories would fade;

·

the appellants had signified their intention to act in person
    three weeks earlier and had not taken any steps to consult with counsel in the
    interim; and

·

Mr. Perlin had been under a doctors care for a couple of years
    and the issue of his medical condition had not been raised until the
    adjournment was sought.

[10]

The
    trial judge explained to the appellants the process that would be followed at
    the trial. She told them that they would be entitled to make an opening
    statement and to adduce evidence after the respondent concluded its case. Each
    stated that they would need about two hours to give their own evidence.

[11]

After
    opening statements, the trial judge adjourned the proceedings to the following
    day to permit the appellants to prepare. She granted a further, unscheduled,
    two-day adjournment at the appellants request to permit them to observe a
    religious holiday. She also granted a one-day adjournment to allow additional
    preparation before final argument.

[12]

The
    appellants actively participated in the trial. They cross-examined many of the
    banks witnesses, sometimes at considerable length. Their cross-examinations
    were thorough and were not curtailed in any way.

[13]

At
    the end of the respondents case, the trial judge asked the appellants whether
    they wished to call evidence. She explained that if they failed to call
    evidence, she would be required to decide the case only on the banks evidence.
    The appellants elected not to call evidence. The trial judge repeated her
    caution the following day. Again, the appellants stated that they did not
    intend to call any evidence in their defence.

[14]

Mr.
    Ber made a thorough closing argument on behalf of both appellants.

[15]

The
    trial judge gave lengthy reasons for judgment, released some six weeks after
    the trial.

C.

the parties submissions

[16]

The
    appellants submit that the trial judge failed to exercise her discretion judicially.
    She failed to take into account that they were self-represented and failed to
    discharge her responsibility to protect their interests. Her decision deprived
    them of their right to retain and instruct counsel and left them unprepared for
    trial in a complex commercial dispute.

[17]

The
    respondent submits that the trial judge properly took the measure of the case
    and concluded, having regard to the totality of the circumstances, that it
    would not be unfair to refuse the adjournment and to require the appellants to
    represent themselves. It was not a complex case, most of the evidence was
    documentary, and the appellants were capable of meeting the banks case through
    their own evidence. The trial judge exercised her discretion judicially. The
    appellants declined the opportunity to testify and they had a fair trial.

D.

analysis

[18]

The
    applicable principles are well understood. They were expressed by this court in
Khimji v. Dhanani
(2004), 69 O.R. (3d) 790, per Laskin J.A.
    dissenting, but not on this point, at para. 14:

A trial judge enjoys wide latitude in deciding whether to grant
    or refuse the adjournment of a scheduled civil trial. The decision is
    discretionary and the scope for appellate intervention is correspondingly
    limited. In exercising this discretion, however, the trial judge should balance
    the interests of the plaintiff, the interests of the defendant and the
    interests of the administration of justice in the orderly processing of civil
    trials on their merits. In any particular case several considerations may bear
    on these interests. A trial judge who fails to take account of relevant
    considerations may exercise his or her discretion unreasonably and if, as a
    result, the decision is contrary to the interests of justice, an appellate
    court is justified in intervening. In my opinion, that is the case here.

[19]

Laskin
    J.A. observed that in refusing an adjournment, the trial judge should have taken
    into account the goal expressed in r. 2.01(1)(a), namely to secure the just
    determination of the real matters in dispute and the resolution of cases on
    their merits.

[20]

Khimji
was considered by this court in
Toronto-Dominion Bank v. Hylton
, 2010
    ONCA 752, which adopted the above statement. This court observed, at para. 36,
    that [t]he presiding judge has a well-placed and a well-established discretion
    to decide whether an adjournment request ought to be allowed or denied. After
    setting out the above statement, the court added, at para. 37:

Laskin J.A.'s passage makes it clear that, in reviewing highly
    discretionary decisions such as whether to allow a request for an adjournment,
    the inquiry must focus on whether the court below took account of relevant
    considerations in balancing the competing interests and made a decision that
    was in keeping with the interests of justice.

[21]

The
    court added that factors to be considered include the reason for the
    adjournment request, the history of the matter, the prejudice to the party
    resisting the adjournment and the consequences to the requesting party of
    refusing the request. The fact that a party is self-represented is a relevant
    factor as the court has an obligation to ensure that all litigants have a fair
    opportunity to advance their positions.

[22]

In
Ariston Realty Corp. v. Elcarim Inc
., [2007] O.J. No. 1497 (S.C.), a
    case much relied on by the appellants, Perell J. helpfully set out at para. 34
    a non-exclusive list of factors that may be weighed in the exercise of a
    courts discretion with respect to an adjournment.

[23]

That
    list includes not simply factors of immediate concern to the parties, but
    factors affecting the broader public interest, including the objective of
    determining the matter on its merits, the appearance of justice and the needs
    of the administration of justice in the orderly processing of trials.

[24]

The
    list in
Ariston
also suggests that the court should consider whether
    the refusal of an adjournment would significantly compromise the ability of the
    party prosecuting or defending the litigation and the effect of the adjournment
    on substantive and procedural justice.

[25]

The
    list also makes it clear that the court must consider the competing interests
    of the parties in advancing or delaying the progress of the litigation.

[26]

Finally,
    Perell J. noted, the judge is entitled to consider the particular
    circumstances of the request for an adjournment and the reasons and
    justification for the request.

[27]

The
    balancing of interests  the private interest of the parties and the public
    interest in the fair and efficient adjudication of disputes on their merits 
    is quintessentially the responsibility of the trial judge who has the parties
    in front of her and is best equipped to assess all the relevant circumstances.
    The trial judge identified some of the factors she considered. In my view,
    those factors  and others she did not mention  amply justified her decision.

[28]

I
    turn to those factors.

The particular circumstances of the request

[29]

The
    respondents had given notice of their intention to act in person. Their trial
    counsel would undoubtedly have explained the consequences to them. They had
    ample time within which to retain new counsel who, if necessary, could have
    appeared at trial, requested an adjournment and offered a timeline and terms,
    such as costs thrown away. They did not do that. They did not demonstrate any
    attempt to retain new counsel. They did not offer terms. It is reasonable to
    conclude that they had simply rolled the dice, hoped to settle and when that
    strategy did not work, decided to try another one  delay.

[30]

While
    the appellants were self-represented, that was the result of their own decision
    to put off trial preparation in the hope of settlement and their own failure to
    come to grips with the cost of litigation until faced with the trial date.

The ability of the appellants to defend the litigation

[31]

The
    trial judge was entitled to consider  and clearly did consider  the   nature
    of the case, the matters in dispute, the appellants familiarity with the
    issues and their relative sophistication. The appellants were experienced and
    sophisticated businessmen. The dispute concerned their business, their records
    and their dealings with the bank. At their core, the issues were not complex
    and the defence was entirely within the appellants personal knowledge. The
    appellant Bers depression had not prevented him from participating in the
    proceedings, including discovery, prior to trial. The trial judge could
    reasonably conclude that the appellants would be capable of defending the claim
    without the assistance of counsel.

The competing interests of the parties in advancing or delaying litigation

[32]

The
    trial judge took this factor into account. It would have been perfectly obvious
    to the trial judge that the appellants had nothing to lose and everything to
    gain by delaying the trial as long as possible. On the other hand, the
    respondent would obviously be prejudiced by further delay of a case that was
    already five years old.

[33]

Moreover,
    delay usually favours a defendant, in this case the appellants, who were
    defendants in the counter-claim. Delay wears the plaintiff down. It gives the
    defendant the use of its own funds while the plaintiff waits and wonders whether
    there will be anything to collect when the judgment day arrives. It may induce
    the plaintiff to take the bird in the hand of a settlement as opposed to the
    cost, delay and uncertainty of a trial some time in the future.

The broader public interest

[34]

There
    is a public interest in the efficient use of scarce judicial resources and in
    the timely, efficient and fair resolution of trials. These were factors the
    trial judge was entitled to take into account, alongside the fair accommodation
    of self-represented litigants.

[35]

The
    trial judge was familiar with the Commercial List and with the Toronto long
    trial list. She was familiar with the system of fixed trial dates and the
    consequences of an adjournment. Last-minute adjournments waste judicial
    resources and public funds. They affect public confidence in the administration
    of justice. They leave parties and witnesses disillusioned. They cost money to
    litigants who have prepared for trial in the expectation that a fixed trial
    date means just that. Real prejudice is caused when a stale case gets even
    more stale. The trial judge properly took these factors into account.

Was the refusal of the adjournment contrary to the interests of justice?

[36]

The
    appellants did not pursue their assertion that the conduct of the trial was
    unfair. There was no merit to that suggestion. The trial judge managed the
    trial firmly but fairly. As the trial unfolded, the appellants participated
    fully and conducted effective cross-examinations and argument. They decided not
    to testify or to call evidence after being clearly informed of the
    consequences. They do not challenge the underlying merits of the trial judges
    conclusions. In the circumstances of this case, it is impossible to say that the
    result of the refusal of the adjournment was not in keeping with the interests
    of justice.

Fresh evidence

[37]

The
    appellants sought leave to introduce fresh evidence on the appeal to describe
    the evidence they would have adduced at trial had they been able to do so. That
    evidence manifestly fails to meet the
Palmer
test. The evidence was
    available at trial and the appellants were given the opportunity to adduce the
    evidence if they wished. They failed to take advantage of that opportunity. The
    motion for leave to introduce fresh evidence is dismissed.

E.

order

[38]

For
    these reasons, the appeal is dismissed, with costs to the respondent in the
    agreed amount of $13,000, inclusive of disbursements and all applicable taxes.

G.R. Strathy C.J.O.

I agree P. Lauwers
    J.A.

I agree M.L. Benotto
    J.A.

Released: March 23, 2016


