Master MacLeod Says “Litigation Finger” Can Point at Two Parties Simultaneously

In Suarez v. Minto Developments Inc., Master Calum MacLeod addressed a couple of interesting issues in the law of misnomer. (This principle has received increased attention over the last couple of years, perhaps because the disappearance of “special circumstances” as a basis for extending a limitation period has caused practitioners and the judiciary to look for other ways to avoid prescription. Misnomer has been specifically preserved in the Limitations Act, 2002 in s.  21(2).)

In Suarez, the plaintiff slipped on a plastic sheet that had been placed on the carpet of his home by some workmen. He fell down some stairs and injured himself. He did not know the name of the flooring contractor nor that of the negligent employee and so, named “John Doe” as a defendant in the statement of claim. In the course of examining another (identified) defendant for discovery, counsel for the plaintiff learned that the unidentified flooring contractor was “Tag Drywall (11009)” and the employee in question was one “Edgar Cronorel”. The plaintiff moved to replace John Doe with Tag Drywall (11009) and Edgar Cronorel.

Recall that the test in misnomer cases is the so-called “litigating finger” (or “litigation finger”, as Master MacLeod referred to it). The test is this: would a person having knowledge of the facts be aware of the true identity of a misnamed party by reading the statement of claim? Would he or she know from the statement of claim, that the “litigating finger” was pointing at him or her?

Master MacLeod had no difficulty in finding that the litigation finger was pointing at Tag Drywall. What caused him more concern was whether that same finger could be said to have been pointing at the employee Cronorel as well. He concluded that it could:

Without attempting to lay down a general principle, I am of the view that in this case John Doe was a generic description intended to refer to the person who did the work at the home and any legal entity responsible for that work whatever relationship the person or entity had with Minto [the general contractor]. That is obvious from the statement of claim on its plain and ordinary meaning.

The Master went on to address the argument that Cronorel was not in Canada and might be prejudiced because he appears not to have known of the claim. Master MacLeod said: “Providing this is correction of a misnomer and not addition of a party beyond the limitation period it is not relevant when the moving party first became aware of the name and could have brought the motion and the presumption of prejudice raised by the passing of the limitation period does not apply.”

We think that he was quite correct in the view that he took of prejudice in the context of misnomer. By definition, a finding of misnomer involves the nunc pro tunc replacement of a party who has been misnamed in the originating process. The party has sued or been sued on the date of issuance, but has simply been misnamed. Whether or not the correction of the misnomer results in “prejudice” to the correctly-named party should be of no more relevance than if he or she had been named properly in the first instance.

Yet the jurisprudence has not followed that approach. To begin with, subrule 5.04(2), which deals with the addition of parties, explicitly makes “prejudice” a factor:

At any stage of a proceeding the court may by order add, delete or substitute a party or correct the name of a party incorrectly named, on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment.

Master MacLeod’s reasons do not indicate the rule under which the motion was brought in Suarez, but subrule 5.05(2) is typically relied upon in such cases.

In Mazzuca v. Silvercreek Pharmacy, the Court of Appeal, in speaking of subrule 5.04(2), seemed to accept that evidence of non-compensable prejudice could defeat a motion to add a defendant on the basis of misnomer:

This language addresses misnomer situations and, in the absence of non-compensable prejudice, permits an amendment where it was intended to commence proceedings in one name but, in error, the proceedings were commenced in another name.

In our opinion, prejudice should be irrelevant where misnomer has been made out.

We also think that Master MacLeod had it right in finding that a single litigating finger can point at more than one party. One of us actually made this argument recently, but without success. In Bremer v. Foisy, one of Master Robert Beaudoin’s  last decisions before his appointment as a judge of the Superior Court, the issue of misnomer arose. This was a personal injury action arising out of an MVA. The police report and other evidence indicated that Foisy, the driver who had caused the accident, was also the owner of his car. So, the lawyer for the plaintiff commenced action naming Foisy as owner and driver and describing him as such in the statement of claim.

More than two years after the accident, it was discovered that in fact, Foisy’s car had been leased from GMAC Leaseco. On a motion to add GMAC as a defendant, we argued that the “litigating finger” pointed at both Foisy (as driver) and GMAC Leaseco (as owner). We submitted that the plaintiff’s lawyer had sued Foisy in both capacities, but it turned out that Foisy had been mistakenly named as owner.

Although Master Beaudoin (as he then was) allowed the motion to add GMAC (on the basis of discoverability), he rejected the misnomer argument. The fact that Foisy would have remained as a defendant (as driver) and GMAC would have been added as owner seemed to be of significance to the Master:

More importantly this is not a case of correcting the name of a party that has been incorrectly named; the Plaintiffs seek to add a party. They do not abandon their claim against Foisy. Leaseco and Foisy are both necessary parties in the light of the provisions of 192 of the Highway Traffic Act R.S.O. 1990 c. H. 8 that expose both the operator and the owner of a motor vehicle to a liability in the event of a motor vehicle accident. There may have been a mistake in this case but it is of an entirely different nature. In my view, that mistake is more appropriately applied in the context of the discoverability issue.

While we will take a win however we can get it, it seems to us that the approach taken by Master MacLeod in Suarez would have supported the addition of GMAC as a defendant in Bremer, on the ground of misnomer. If an action is commenced against an individual in two capacities but, unknown to the plaintiff’s lawyer, someone else holds one of those two capacities, how is that any different from suing “the emergency room doctor” by naming “Dr. John Doe”? Assuming that the allegations in the statement of claim contain the necessary details, they would make it just as clear to the correct defendant, that he, she or it was the person to whom the litigating finger was pointing.

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