Big banks take note: London’s court doesn’t want your Toronto-based cases.
Superior Court Justice Ian Leach’s decision late last month scolded The Toronto-Dominion Bank for bringing a Toronto collections case to the jam-packed London civil docket and sent a message to other Toronto-based financial institutions who’ve been “forum-shopping” for other jurisdictions where cases might be heard sooner to perhaps gain a strategic advantage.
“The phenomenon of financial institutions increasingly initiating collection proceedings and corresponding motions here in London, when the underlying matters seem to have no discernible connection with Middlesex County, (or the Southwest Region more generally), is a growing concern that has been noted by court staff and numerous judges here in London,” Leach wrote.
Leach wrote that “it was only a matter of time” before venue switches to circumvent the Toronto courts logjam became an issue in front of a London judge.
By shoe-horning their cases onto the London docket, out-of-area cases “impose an additional inappropriate burden on the limited resources of this judicial centre and/or region, when their matters properly should be dealt with elsewhere.”
While most court regions across Ontario are still digging out from pandemic backlogs, the modifications made to keep the courts functioning during the public health crisis are partially to blame for the arrival of outside civil files from financial institutions. The now-routine use of virtual courts make it easy for lawyers to file cases outside their area and argue them in front of a judge outside their region.
“In other words, the practical constraints that formerly encouraged litigants and their counsel to pursue litigation in the appropriate forums, associated with their respective disputes, have largely disappeared,” Leach wrote.
The case that prompted the judge’s pushback landed on Sept. 27 in London’s busy weekly motions court – a day set aside for civil motions that require only an hour or less of court time.
It appears the bank’s case was complicated and should have been heard as a civil special appointment with more scheduled preparation and court time.
But the bank came to docket-heavy motions court with a 224-page motion record and case background to be reviewed, seeking a summary judgement against The Other End Inc., a Toronto film production company and Amir Endalah, the company’s founder and CEO, for loans and credit cards the bank said are in default.
It wanted to speed up the process, because it said the defendants, who were initially self-represented, were stalling. But when the case came before Leach, the film company and Endalah had retained a lawyer who argued the bank’s motion was premature and wanted it adjourned to gather more materials and examinations in their defence. The judge agreed they should have more time and that their request “was not baseless delay tactics.”
But that wasn’t the principal reason Leach granted the adjournment. The defendant argued that the case “has no discernable links with Middlesex County and appears to have been brought in London solely for the purpose of obtaining an earlier hearing than that which might be available in other centres,” such as Toronto, where the action began, Leach wrote.
The defendants wanted time to bring a motion in Toronto to have the bank’s London motion transferred back to where it came from.
“I think the defendants should be provided with that opportunity, not only for their sake but for the sake of the court’s resources here in London and the Southwest Region more generally,” Leach wrote.
The bank argued that there shouldn’t be a delay. But Leach wrote “it seems to me that the risk of such delays is inherent in the plaintiff choosing to initiate a proceeding and bring motions here in London in circumstances where there appears to be no connection with this judicial centre, or indeed this region.
“Going forward, perhaps litigants in the position of the plaintiff will factor such risks into their decision-making when it comes to venue selection,” he wrote.
Leach’s decision was welcomed and reflected the frustrations of the local court and civil bar already dealing with significant delays because of case backlogs.
“It does speak to the problems we’re having across the province,” said London civil lawyer Maia Bent, past president of the Ontario Trial Lawyers Association. “Southwestern Ontario is one of the most backed-up areas of the province.”
The tactics of the financial institutions “just downloaded the congestions and delay issues (in Toronto) into Middlesex County where we have our own congestion and delay issues,” she said, adding it’s done “at the expense of the local litigants who are trying to get in front of the court for their own matters.”
Bent, who is also practice group leader of Lerners’ plaintiff personal injury group, said the civil bar has been in a holding pattern “for literally years” while local courts dealt with the pandemic and an incomplete complement of judges to handle cases. Civil cases became the third priority after criminal and family law.
That’s meant some civil litigants, many who are personal injury cases, “have not been able to have their day in court,” she said.
She said the lawyers have been told the London court is planning a “blitz” to clear the dockets during one month this spring and another month next fall and all judicial resources will be focused on hearing civil actions.
By then, the banks may have gotten the message about moving onto London’s dockets. Leach noted in his decision that this was not the first time a bank had brought a Toronto-based case to London and that the bank’s lawyer admitted it “has further similar motions returnable here in London over the coming months.”
The bank’s lawyer would be reporting Leach’s decision back to the bank “with a promise that her client thereafter will take such concerns seriously,” the judge wrote.