Digests

Budget Steel Ltd. v. Seaspan 175 (The)

T-168-01

2003 FCT 390, Hargrave P.

1/4/03

27 pp.

Action arises out of loss of cargo of scrap steel from barge Seaspan 175--Statement of claim served May 7, 2001; defence and counterclaim on June 14, 2001--Counsel for plaintiff unable to obtain instructions to defend counterclaim, requested by letter that defendant not take default judgment--On July 10, 2002 counsel received instructions to defend counterclaim and on July 11 brought present motion for extension of time within which to serve and file defence to counterclaim--Action raises four issues concerning additional affidavits, reopening of motion hearing, time extension and application of issue estoppel--(1) Did not seek leave to file additional affidavits, but presented affidavits as matter of course--Two affidavits contain nothing not readily available when filed initial material on motion--Plaintiff submits judges and prothonotaries have wide discretion to hear additional evidence and argument, after hearing concluded, but before judgment formerly entered--In present case, counsel relies substantially on British Columbia cases involving trials and inherent jurisdiction of courts--Five elements to consider in case of supplementary affidavit: (i) whether affidavit will serve interest of justice; (ii) whether supplementary affidavit will assist court; (iii) whether any substantial or serious prejudice to other party; (iv) additional material not available at earlier date or not available had proper diligence been exercised; and (v) additional material will not unduly delay proceedings--In present instance, as add nothing by way of valid excuse for delay in filing defence to counterclaim, new affidavits will not assist Court--Would certainly delay conclusion of motion, for defendants would probably feel both obliged to cross-examine and to respond--Finally, affidavits unlikely to prejudice anyone and contain only material readily available before Motion Judge--Two new affidavits not allowed--(2) Regarding re-opening of motion hearing, Court considers both whether substantial injustice might be done to plaintiff, if motion not re-opened for further argument and whether injustice might be done to defendants if motion re-opened--Appropriate test to apply found in Canada (Attorney General) v. Hennelly (1999), 244 N.R. 399 (F.C.A.): continuing intention to pursue application, application has some merit, no prejudice to respondent as result of delay and reasonable explanation for delay--(3) On basis of test, facts plaintiff may in fact have extension--Main claim not pursued--Took over a year to obtain instructions to defend clearly delineated counterclaim for freight and barge damage--But plaintiff's counsel by letter at early stage seeking time concession from defendant and defendants did nothing in face of such request--Plaintiff's request default not be taken without notice constitutes indication no intention to abandon any defence by counterclaim--Regarding requirement of merit, plaintiff's investigations revealed Seaspan 175 had starboard list, barge needed pumping to remove list, tug and barge left Victoria harbour notwithstanding severely deteriorating weather condition and shortly after leaving harbour barge listed to starboard and capsized--Case for merit substantial-- Regarding prejudice to defendant, plaintiff pointed out facts underlying counterclaim same as those at issue in main action and in order to defend main action defendant would necessarily have investigated in same manner as would be necessary in pursuing counterclaim--Delay not resulting in any prejudice--Regarding reason for delay, excuse of plaintiff for delay uncertainty as whether or not plaintiff insured for defendants' counterclaim--Some excuse for delay taking into account letter from counsel for plaintiff requesting time within which to obtain instructions and absence of reactions by defendants, until present--(4) Regarding whether issue estoppel could apply, elements necessary for issue estoppel found in Angle v. M.N.R., [1975] 2 S.C.R. 248--Issue estoppel requires: same question decided, judicial decision said to create estoppel final, and parties to judicial decision same as parties to proceedings in which estoppel raised--In present instance, while claim and counterclaim arise out of same incident, on pleadings claim and counterclaim involve very different questions--Claim for negligence and breach of contract of Seaspan as carrier--Counterclaim for failure on part of plaintiff to maintain and repair barge including liability for damage caused to barge during transit--Issues of fact in claim and counterclaim incidental and collateral--Defendants argued default judgment not final judgment, thus estoppel not applying--In Montres Rolex S.A. v. Canada, [1988] 2 F.C. 39 (T.D.), Court noted orders in nature of summary procedural judgments where no trial of issues, should not be accorded finality and conclusiveness of judgment on merits of such issues--Default judgment for freight and barge damage by no means conclusive of question of safe and proper carriage-- Chances of default judment on counterclaim prejudicing plaintiff's claim remote--Time extension granted.