IN THE PROVINCIAL COURT OF BRITISH COLUMBIA

[1]           The Defendant Challenger Motor Freight Inc. applies for an order under Rule 17 of the Small Claims Rules setting aside an order made at a trial of this matter at which the Defendant had notice, but failed to attend. The law concerning such applications has been understood for decades to be as set out by the British Columbia County Court in Miracle Feeds v. D & H. Enterprises Ltd. (1979) 10 B.C.L.R. P-58. In that case, County Court Judge Hinds held that in order for a defendant to succeed on an application to set aside a default judgment, the applicant must show three things:

[2]           These requirements must be established to the satisfaction of the court through affidavit material filed by or on behalf of the defendant.

[3]           The reason for the Defendant’s failure to appear at trial appears to be for reasons of negligence rather than for wilful or deliberate reasons. The Defendant’s representative, Mr. Charles Brewster, states in his affidavit:

[4]           This sworn statement raises a number of concerns. Firstly, the trial scheduling notice on the court file was signed on behalf of the Defendant by someone with a signature very much like the one that appears above the signature line on Mr. Brewster’s affidavit. The trial scheduling notice does clearly set out the “place date and time for the trial” as being “20-Apr-2018” at 09:00 AM at Abbotsford Provincial Court in Room 105. The court file contains the entry “parties signed scheduling notice and a copy given to them by JCM.” The material on the court file makes it very likely that Mr. Brewster was handed a written notice of when the trial was scheduled for by the Judicial Case Manager and that his sworn statement that “the Defendant did not receive a Notice of Trial” is probably not correct.

[5]           The explanation given by counsel for the failure of the Defendant to appear at trial was somewhat different than that contained in Mr. Brewster’s affidavit. Counsel advised that the witness was referring to the practice followed in Ontario, not in British Columbia when he says that he assumed he would get another written notice of the trial date. But Mr. Brewster gives his address as Abbotsford, BC in his affidavit and does not mention any confusion with what the practice was in Ontario as the reason for the Defendant missing this trial date.

[6]           At the settlement conference, the presiding judge ordered that the parties exchange certain information “two weeks prior to the trial date”. The Settlement Conference was held on November 20, 2017 (the same day that the parties appeared in the office of the Judicial Case Manager to set the April 20, 2018 trial date). It seems surprising that in that six month interval, the Defendant would not make some effort to find out when the trial date was to be set if it legitimately did not know.

[7]           At the very least, the Defendant’s officer was negligent and his negligence put the Claimant to the trouble and expense of preparing for trial, lining up its witness and showing up on the trial date to present its evidence.

[8]           In his Affidavit, Mr. Brewster says that “Immediately upon being aware of the scheduling error, the Defendant engaged counsel to take immediate steps to have the Default Order set aside.” The Affidavit is not more specific than this. It does not say when the Defendant became aware of the error, or when it retained counsel. The default judgement was entered on April 20, 2018 and the Application to Set Aside the Judgement was filed on June 11, 2018.

[9]           The Claim brought in this matter is a simple one. It alleges that the Claimant was hired by the Defendant to deliver a load of freight to Ontario, that it did so, and that it wasn’t paid for doing so by the Defendant. In submissions made on this application, counsel for the Defendant was asked what the defence to the Claim was. Counsel gave two answers. Firstly, he asserts that the proper forum for this Claim is Ontario, not BC. No authority was provided for this proposition. Secondly he says that his client also has an undisclosed counter-claim that it may or may not be making.

[10]        In his Affidavit, Mr. Brewster says that the Claimant “did not perform the transport services as required and did not provide any explanation for its service failure.” He then refers to the Reply filed in this matter.

[11]        The Reply acknowledges that the Defendant entered into a contract with the Claimant to transport a full load of freight for one of its customers from Abbotsford, BC to Mississauga, Ontario. Due to the nature of the freight, specific arrangements had to be made for its loading and unloading. According to the Reply filed, the loading of the freight occurred satisfactorily. The problem was that the Claimant’s truck did not arrive at the scheduled time for the unloading, and in fact arrived three days late. The Defendant says in its Reply that the delay cost it $11,693.45 and it blames that on the Claimant for being late with the delivery.

[12]        The Reply does not include any counter-claim. It states that the Defendant is holding “this cause of action in abeyance pending a determination of” the issue of whether the Claim is properly brought before this court. The Reply goes on to assert that the Claimant should have brought this action in Ontario.”

[13]        The Affidavit does not directly swear that the facts alleged in the Reply are true. It is also interesting to note that in the eight months since the Settlement Conference, the Claimant has not made any application to determine the issue of whether or not this court has jurisdiction to hear the claim, and it is silent on the subject of whether or not any court proceedings have begun in Ontario.

[14]        As earlier stated, the Defendant’s failure to attend the trial of this matter was the result of carelessness or negligence on the part of Mr. Brewster. This is something different from the “wilful or deliberate” failure to attend the trial. Both of these terms suggest an intention on the part of the Defendant not to attend the trial and a clear choice made not to do so. In Kleinfelder v. Stoy [1994] B.C.J. No. 2823, the late Chief Judge Stansfield of this court, held that the word "wilfully" goes beyond deliberate intention and can include the kind of recklessness “which is so extreme or unjustifiable as to amount to wilfulness.”

[15]        Here the Defendant’s conduct falls short of a wilful or deliberate intention to fail to attend the trial. It was certainly careless and negligent, and when the Defendant’s representative was handed a piece of paper with the trial date on it, he failed to give the matter its proper priority. His conduct caused the Claimant and her witness unnecessary expense and it was disrespectful to the court process. The court time could have been utilized by others waiting in the cue for their day in court. It is at least deserving of an award in costs against the Defendant under Rule 20(6). That rule allows a judge to order a party whose conduct causes another party to incur expenses to pay all or part of those expenses.

[16]        Although the Defendant has not given a detailed explanation for the delay in bringing this application, that delay does not seem to be inordinately long. The issue is whether there is a meritorious defence. Of the two defences claimed, the first, about whether or not the claim must be brought in Ontario, is more easily resolved. The law is clear that where, as in this case, acceptance of a contract is transmitted electronically, the contract is considered to be made in the jurisdiction where the acceptance is received. Eastern Power Ltd. v. Azienda Communale Energia & Ambiente (1999) 1999 CanLII 3785 (ON CA), 178 D.L.R. (4th) 409 (Ont. C.A.), at paras. 23, 27-29, leave to appeal to S.C.C. refused, [1999] S.C.C.A. No. 542; Inukshuk Wireless Partnership v. 4253311 Canada Inc., 2013 ONSC 5631 117 O.R. (3d) 206, at paras. 25-29.

[17]        In this case, the Affidavit of Mr. Brewster discloses that not only was the acceptance of the original agreement made in British Columbia, but the communications on behalf of the Defendant also originated in British Columbia, from a person named Rob McGregor, its Carrier Procurement employee in Burnaby, BC. There is ample evidence to support the conclusion that the Claimant was entitled to commence this action in this court because both the offer and acceptance originated with actors located in BC.

[18]        The second issue is more complex. The Defendant has provided the court with enough evidence to find that there is “at least a defence worthy of investigation”, specifically a set-off based on the alleged breach of the Claimant’s promise that the loads would be delivered by October 3^rd. The problem is that in the over twenty months since this cause of action arose, the Defendant has not taken any steps to have its allegation of wrong-doing on the part of the Claimant heard in a court in Ontario, as it says should take place. There is no dispute about the services provided by the Claimant or the amount owing for those services. The only issues are if the Defendant has a set-off or counter-claim, and if that should be determined by an Ontario court. The Defendant has not expressed any intention to have the issue of the set-off decided by this court.

[19]        This dilemma can be resolved by having resort to section 2 (1) of the Small Claims Act, which provides that the purpose of the Act is to allow litigants in this court to have their claims resolved in a “just, speedy, inexpensive and simple manner.” Flexibility is also given to the court under rule 17(4) which allows a judge to “impose any condition or give any direction that the judge thinks is fair.”

[20]        In this case, this can be achieved, not by forcing the Claimant to relitigate the issue of its account with the Defendant, but rather by requiring the Defendant to show some diligence and demonstrate the sincerity of its purported defence. If the Defendant is sincere in its assertion that it has a claim against the Claimant and that such claim should be litigated in Ontario, then it should take the appropriate legal action. It should either commence its action for damages in Ontario, or alternatively agree to have the issue of the set-off litigated in this court.

[21]        Taking into account the intent of section 2 of the Small Claims Act, the application to set aside the default order will be refused, but the Claimant’s ability to enforce the judgement will be suspected until September 30, 2018. Within that time the Defendant will be afforded one final opportunity to show the sincerity of its defence. It can apply to extend that suspension upon furnishing sufficient evidence showing that it has taken steps to litigate any set-off or counter-claim it has either in Ontario, or  before this court by asking for a hearing of that issue to be fixed for hearing here.

[22]        For the foregoing reasons the application brought by the Defendant to set aside the Default Judgement is dismissed. The Claimant’s right to enforce its judgement is suspended until September 30, 2018 unless otherwise extended by an order of this court.