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Civil Litigation - Multiplicity of Proceedings. SIF Solar Energy Income & Growth Fund v. Aird & Berlis LLP
In SIF Solar Energy Income & Growth Fund v. Aird & Berlis LLP (Ont CA, 2025) the Ontario Court of Appeal considered an appeal from a stay order, here where the court below stayed one action [the 'A&B Action'] on the grounds that the defendant could have been added to another existing action - and that thus the continuance of the two proceedings was an abuse of process.
The court took this oppourtunity to consider the overlapping doctrines of multiplicity of proceedings, consolidation, joinder of parties, abuse of process (in it's R21.01(3)(d) 'frivolous and vexatious' context), and stays as an abuse of process remedy:[10] After setting out the procedural history, the motion judge turned to the parties’ submissions. A&B relied on this court’s decision in Maynes v. Allen-Vanguard Technologies Inc. (Med-Eng Systems Inc.), 2011 ONCA 125, 274 O.A.C. 229, in support of its argument that the A&B Action was an abuse of process because the appellants ought to have moved under r. 26.02 for leave to add A&B as a defendant to the Main Action. The appellants relied on Abarca v. Vargas, 2015 ONCA 4, 123 O.R. (3d) 561, where this court concluded that an action against the plaintiffs’ own insurer based on the underinsured motorist coverage in their auto insurance policy was not an abuse of process, and permitted that action to proceed in tandem with a tort action against the other driver. The appellants asserted that, while the A&B Action arose out of the same factual matrix as the Main Action, the claims against A&B were distinct and sought unique, contingent relief against A&B. They also argued that the A&B Action was commenced separately to preserve their claim of solicitor-client privilege in the Main Action.
[11] The motion judge cited paras. 38 to 40 of Maynes, where this court concluded that there was an abuse of process where the plaintiffs had commenced a new action instead of seeking to add defendants to an existing action. He expressed the view that Abarca turned on “the legal and procedural complexities of multivehicle accidents involving tort, contract and insurance law, as well as administrative proceedings under the SABS.” He also noted that the Court of Appeal in Abarca distinguished Maynes on three grounds: (i) that the relief sought against the defendant insurer in the second action was distinct from the relief sought in the first action; (ii) that the claim against that defendant was not known when the first action was commenced; and (iii) that there was a real possibility that the claim against the insurer would be out of time, and the plaintiffs would be deprived of access to the underinsured motorist coverage. The motion judge observed that none of these features were present in the case before him.
[12] The motion judge concluded that “the reasoning in Maynes applies”. He stated that s. 138 [SS: 'multiplicity of proceedings'] of the Courts of Justice Act, R.S.O. 1990, c. C.43 (the “CJA”), the rules of joinder in r. 5.02, and the provisions of r. 26.02 set out the appropriate procedures to follow in this case. The claim against A&B, in the absence of A&B’s consent, ought to have been advanced by way of a motion for leave to amend the Main Action under r. 26.02(c).
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[16] The motion judge concluded that the commencement of a separate action against A&B was an abuse of process, and that the appropriate remedy was a stay of the A&B Action and a direction that the appellants must move under r. 26.02 for leave to amend the Main Action if they wished to add A&B as a party and plead the allegations made in the A&B Action. ....
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D. Issues and Positions of the Parties
[18] The issues on this appeal are (1) whether the motion judge erred in concluding that the commencement of the A&B Action was an abuse of process; and (2) whether the motion judge erred in ordering a permanent stay of the A&B Action.
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(a) Avoiding a Multiplicity of Proceedings, Amendment and Joinder
[24] Section 138 of the CJA provides that “[a]s far as possible, [a] multiplicity of legal proceedings shall be avoided.” This is a general rule that informs the specific rules available to parties in civil proceedings concerning joinder of claims and parties, amendments to pleadings, consolidation and trial together of proceedings, and rr. 21.01(c) and (d) when invoked to stay or dismiss duplicative proceedings.
[25] Apart from r. 5.03, which requires all necessary parties to be joined as a party to a proceeding, the choice of parties to pursue in a proceeding is for the plaintiff or applicant. The rules of joinder are permissive; that is, a plaintiff may, but is not obliged to, pursue all of its claims involving the same factual circumstances in a single action.
[26] The rules respecting the amendment of pleadings to add a defendant to an action are also permissive. Rule 26.02 provides that a party may amend its pleading (a) without leave, before the close of pleadings, if the amendment does not include or necessitate the addition, deletion or substitution of a party to the action; (b) on filing the consent of all parties and where a person is to be added or substituted as a party, the person’s consent; or (c) with leave of the court. Rule 5.04(2) provides that “[at] any stage of a proceeding the court may by order add, delete or substitute a party … on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment.” Again, a plaintiff may seek leave to add a defendant to an existing proceeding but is not required to do so.
[27] The joinder rules are similarly flexible and permit parties to move before the court for orders respecting the scope of a proceeding, particularly where the issue is whether claims should be advanced in a single proceeding.
[28] A defendant that objects to the joinder of claims or parties in a single action can bring a motion under r. 5.05 for relief against joinder. Where the court is satisfied that the joinder of multiple claims or parties in the same proceeding “may unduly complicate or delay the hearing or cause undue prejudice to a party”, the court can make various orders including ordering separate hearings; requiring one or more of the claims to be asserted in another proceeding; and staying the proceeding against a defendant pending the hearing of the other proceeding on condition that the defendant to the stayed proceeding is bound by findings made at the other hearing. Rule 5.05 reflects the reality that there may be any number of reasons why, even where the factual matrix is the same, it might be preferable for claims or parties to be pursued in separate proceedings.
[29] By contrast, r. 6 is available so that parties can seek consolidation or trial together of two or more proceedings that are pending in the court. An order can be made where the court is satisfied that (a) the proceedings have a question of law or fact in common; (b) the relief claimed in the proceedings arises out of the same transaction or occurrence or series of transactions or occurrences; or (c) for any other reason such an order should be made. The motion is necessarily brought on notice to the parties in all affected proceedings. The court can order that the proceedings be consolidated or heard together or one after the other, that one proceeding be stayed while the other proceeds, or that claims in one proceeding be asserted by way of counterclaim in another, and may give such directions as are just to avoid unnecessary costs or delay.
(b) Dismissing or Staying Duplicative Proceedings for Abuse of Process
[30] Where a plaintiff or plaintiffs have commenced multiple proceedings against a defendant, a defendant can move for relief before the court to dismiss or stay one or more of the proceedings.
[31] The authority to dismiss or stay an action that is an abuse of process derives from r. 21.01(3)(d) of the Rules (referring to an action that is frivolous or vexatious or is otherwise an abuse of the process of the court) and the inherent and residual jurisdiction of the court. The abuse of process doctrine “engages the inherent power of the court to prevent the misuse of its procedure, in a way that would be manifestly unfair to a party to the litigation before it or would in some other way bring the administration of justice into disrepute”: Toronto (City) v. C.U.P.E., Local 79, 2003 SCC 63, [2003] 3 S.C.R. 77, at para. 37, citing Canam Enterprises Inc. v. Coles (2000), 2000 CanLII 8514 (ON CA), 51 O.R. (3d) 481 (C.A.), at para. 55, per Goudge J.A., dissenting (approved, 2002 SCC 63, [2002] 3 S.C.R. 307).
[32] Rule 21.01(3)(d) has been invoked to fill a gap when all of the elements of issue estoppel or res judicata could not be made out, but where the defendant asserts that the commencement of a second proceeding that overlaps with one already determined (through court order or settlement) would work an injustice: see e.g., Niagara North Condominium Corp. No. 125 v. Waddington, 2007 ONCA 184, 222 O.A.C. 66. More recently, r. 21.01(3)(d) has been relied on in support of motions to dismiss or stay an action where there is another, overlapping, proceeding pending. While 21.01(3)(c) permits a defendant to move to dismiss or stay an action on the ground that “another proceeding is pending in Ontario or another jurisdiction between the same parties in respect of the same subject matter” (emphasis added), this rule does not assist a defendant who has not been sued in the other proceeding.
[33] Even where r. 21.01(3)(c) applies, that is, where the parties and subject matter are the same, a dismissal or stay of the second proceeding is not automatic. The court must be satisfied that such relief is warranted in the particular circumstances of the case. The moving party must demonstrate that the continuation of the action would cause it substantial prejudice or injustice (beyond inconvenience and expense) because it would be oppressive or vexatious or would otherwise be an abuse of the process of the court, and that the stay would not cause an injustice to the responding party. Factors relevant to prejudice include the likelihood and effect of the two matters proceeding in tandem, the possibility and effect of different results, the potential for double recovery, and the effect of possible delay: Birdseye Security Inc. v. Milosevic, 2020 ONCA 355, at paras. 15-16.
[34] Where the court finds that a proceeding is an abuse of process, the appropriate remedy will be case-specific. As this court observed in Abarca, at para. 29:There is no law supporting the conclusion that an abuse of process must lead inevitably to the dismissal of the associated claim. In each case the court must assess the gravity of the abuse in determining the severity of its response, bearing in mind the principle of proportionality. This approach is not surprising, since instances of abuse of process fall across the spectrum from egregiously contemptuous conduct to relatively minor breaches of procedural rules. (c) Maynes, Abarca, and other relevant cases
[35] The central issue before the motion judge was whether the A&B Action was an abuse of process. While it is not clear whether the parties confined their arguments to these two cases, the motion judge approached the issue as depending on which of this court’s decisions in Maynes and Abarca he should follow. Keeping in mind that the determination of whether a proceeding is an abuse of process depends on all of the relevant circumstances (see Birdseye Security Inc., at para. 15), it is helpful to recall the facts and reasoning of each case.
[36] In Maynes the plaintiffs had commenced three actions. The third repeated substantially the same allegations against the same defendants in two other ongoing actions and added new defendants. The motion judge granted the defendants’ motion to strike the statement of claim in the third action and dismissed the plaintiffs’ cross-motion seeking leave to amend that claim or to join the claim to the two ongoing actions. A number of issues were before this court on appeal: whether the third action was an abuse of process; whether the third action disclosed a reasonable cause of action against the new defendants; and whether any remaining claim against the new defendants ought to have been joined or consolidated with the ongoing actions.
[37] This court concluded that the third action was an abuse of process. The pleadings in the ongoing actions had closed and documentary and oral discovery in those actions was substantially complete. The plaintiffs initially sought to combine the ongoing actions and to add the new defendants and the claims against them to those proceedings, providing a draft amended statement of claim. The plaintiffs did not obtain the consent required by r. 26.02(b) to add a party after the pleadings had closed. Instead of bringing a motion under r. 26.02(c), the plaintiffs commenced the third action and sought joinder or consolidation of that action with the ongoing actions. The third action duplicated the same five claims the plaintiffs made against the original defendants in the ongoing actions and added new claims for declaratory relief against the new defendants.
[38] It was in those circumstances that this court upheld the finding in the court below that the third action constituted an abuse of process. This court held that the motions judge correctly identified the claims against the original defendants in the new action as an abuse of process “because they were virtually identical to the claims asserted against them in the [ongoing actions]”, and that if such claims were allowed to proceed “it would amount to a relitigation of the same issues as between the same parties”: at para. 36. This court went on to state that the claims against the new defendants were also an abuse of process because the purpose of the commencement of the new action was to name the added defendants as parties to the related litigation, effectively circumventing the express procedural requirement in r. 26.02(c) that leave of the court be obtained to add a non-consenting party to the proceeding after pleadings were closed.
[39] This court also upheld the motions judge’s dismissal of the new action on the basis that it did not disclose a reasonable cause of action against the new defendants. As such, there was no issue about the appropriate remedy for abuse of process, and the court did not have to consider the alternative claim for consolidation or trial together of the actions.
[40] In Abarca the plaintiffs commenced a tort action against an underinsured driver following a motor vehicle accident. This court upheld a motion judge’s finding that the plaintiffs, in commencing a new action, had abused the court’s process by disregarding an earlier direction of the court to bring a motion to amend a claim on notice. Lauwers J.A. held that this abuse of process, which he characterized as minor, did not warrant a dismissal of the second action because the result would be a potential loss of underinsured coverage by operation of a limitation period. He concluded however that the motion judge had erred in finding that, absent the earlier direction, it was an abuse of process for the plaintiffs to start a new action against the insurer in relation to the underinsured motorist coverage. He disagreed with the premise that starting a new action was necessarily abusive, and he rejected Maynes as the “ruling precedent”. He pointed out a number of circumstances in Maynes that were not present in the case before him, including that the third action had been commenced after the plaintiffs failed to obtain consent to add the new defendants and claims to the ongoing proceedings; that five of the six claims asserted in that action were “virtually identical” to the original claims and the sixth was for declaratory relief alone and disclosed no reasonable cause of action; and that “key representatives” of the new defendants were already involved in the original actions.
[41] I read this court’s decision in Abarca as rejecting the general principle that A&B advances here: that it is always an abuse of process when a second action is commenced in circumstances where the first action could have been amended to add a defendant or claim. Rules 26.02 and 5.04 govern the amendment of pleadings and adding parties to an action, but do not preclude the issuance of separate proceedings even if they involve common factual matrices and overlapping parties. Rather, the rules of consolidation and joinder exist to address situations where actions should be tried together or consolidated.
[42] I agree with the appellants that the result in the present case did not depend on whether Maynes or Abarca should be followed, but on how the principles in those and other cases respecting abuse of process and overlapping proceedings ought to be applied. In my view Maynes reflects the application of the relevant rules to the facts of that case, but does not mandate a finding of abuse of process in every case where a second proceeding is commenced instead of adding a defendant to an overlapping existing proceeding, nor does it preclude consolidation or other procedural orders as an appropriate response to a multiplicity of proceedings.
[43] Subsequent cases have recognized that whether the commencement of a second and overlapping action is an abuse of process will depend on the particular factual circumstances, including the purpose of the commencement of the subsequent action. In a number of cases, judges have determined that a second action was an abuse of process when it was commenced in order to circumvent a court order, such as a costs order (see Living Water (Pressure Wash Services) Ltd. v. Dyballa, 2011 ONSC 5695), or an order requiring the posting of security for costs (see Carbone v. DeGroote, 2018 ONSC 109). In Nuco Jewelry Products Inc. v. Lynott, 2016 ONSC 5532, the court found that claims alleging conspiracy and fraud were inextricably intertwined with the liability of a defendant to a related action, and the defendants’ liability was alleged to be joint and several. The court stayed the second action to permit the plaintiff to bring a motion to add a new defendant to the related action, anticipating that the stay could be lifted if such relief were refused.
[44] In other cases, judges have declined to find an abuse of process where a second and overlapping action was commenced, and instead have addressed concerns about a multiplicity of proceedings by granting orders for consolidation or trial together: see e.g., Zhu v. Siew, 2020 ONSC 7045, 153 O.R. (3d) 219; Dimakos v. Dimakos, 2021 ONSC 3248; and Howlett v. Northern Trust Company, 2023 ONSC 4531.
[45] These cases recognize that, while the commencement of a second proceeding may give rise to concerns about overlapping questions of law and fact or the risk of inconsistent verdicts, it is not necessarily an abuse of the process of the court. While a party might require a remedy in order to avoid prejudice caused by a multiplicity of actions, that remedy is frequently an order under r. 6.01 for consolidation or trial together, with appropriate procedural directions to address the interests of all parties. At paras 46-63 the court considers these doctrines on the case facts.
. Grandfield Homes (Kenton) Ltd. v. Chen
In Grandfield Homes (Kenton) Ltd. v. Chen (Ont CA, 2024) the Ontario Court of Appeal dismissed an appeal by an appellant owner who was denied the ability to argue (or amend) their application to claim damages in an APS breach case. The appellant had already successfully claimed for declarations regarding the respondent's breach and for the right to retain deposits, but then - by pointing to passages of their application factum - further argued that they had in fact had 'pled' the damages remedy.
Here, the court considered an issue of 'multiplicity' of proceedings that arose if the appellant's argument succeeded:[15] For completeness, we turn to the second ground of appeal. We agree with the application judge’s assessment that ordering the trial of the additional damages would result in a bifurcation of the issue of damages, an unnecessary multiplicity of proceedings, and potential prejudice to the respondent.
[16] The appellant has not asked that we set aside the application judge’s entire judgment, let alone his order that the deposits are forfeited. As a result, the issue of damages would be bifurcated and could result in inconsistent findings with respect to the quantum of the appellant’s damages. Two examples serve to illustrate this point. First, as the application judge noted, if the appellant incurred a substantial loss in the resale of the property, this could provide evidentiary support for the respondent’s submission that the appellant had misrepresented the quality of the home’s finishings. If this submission were accepted, a reduction of the appellant’s claimed damages could result, potentially below the amount of the forfeited deposits ordered by the application judge. Second, if it were established at trial that the appellant had failed to mitigate its damages, this failure could result in a finding that the appellant was not entitled to any damages or damages in an amount less than the forfeited deposits, again in contrast with the application judge’s determination with respect to the deposits.
[17] We turn finally to the question of prejudice.
[18] Allowing the bifurcation of the issue of damages gives rise to an unnecessary multiplicity of proceedings. Proceeding in this way squanders scarce judicial resources and prejudices the efficient and due administration of justice. While the bifurcation of issues may, in some cases, be a sensible way to proceed, there was no reason why the issue of damages could not be determined in one proceeding in this case.
[19] Moreover, there is potential prejudice to the respondent. The respondent was entitled to respond to the case she had to meet as framed in the appellant’s pleadings and could very well have responded differently had the appellant pleaded its claim for additional damages. A claim for forfeited deposits already paid is different from a claim for the loss of the market value of the subject property. Absent a claim in the pleadings, including in the appellant’s affidavit materials, or a motion to amend, we do not accept that the respondent was put on notice of the appellant’s additional damages claim because of general statements made by previous judges in the context of an unrelated motion and a scheduling attendance. Bald statements that the appellant might be seeking additional damages in an unparticularized amount are inadequate to allow the respondent to know the case she had to meet. There was nothing in the notice of application or the appellant’s affidavit materials regarding the claim for additional damages for the respondent to answer. As earlier indicated, it was insufficient for the appellant simply to seek the relief in its factum. . Cipponeri Construction Services Inc. v. Orsi
In Cipponeri Construction Services Inc. v. Orsi (Ont CA, 2023) the Court of Appeal considered a procedural fact situation that the lower court held to infringe on the rule against multiplicity of proceedings:[5] On a motion by Mr. Orsi, the motion judge dismissed the 2020 Action. Pursuant to r. 21.01(3)(d) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, he held it was an abuse of process for CCSI to commence a separate action which created a multiplicity of proceedings; the correct process was to seek leave to add CCSI as a plaintiff by counterclaim in the 2018 Action. He indicated in his reasons that the dismissal of the 2020 Action was without prejudice to CCSI, Mr. Cipponeri, or 259 seeking leave under r. 26.02(c) to add CCSI as a party in the 2018 Action. The motion judge also dismissed the 2020 Action against Mr. Orsi personally on the basis that the statement of claim did not disclose a cause of action against him, as the claim was for money allegedly owed by Westin.
[6] On appeal, CCSI argues that the motion judge erred in finding the 2020 Action was, as against Westin, an abuse of process.[1] It asserts that the action was commenced to preserve a limitation period, which is not an abuse of process: Abarca v. Vargas, 2015 ONCA 4, at paras. 20-23. It adds that the process followed – starting a new action rather than amending the counterclaim − was in part a function of what counsel thought could be done expeditiously in the early stages of the COVID-19 pandemic. And even though the 2020 Action created overlap with an aspect of the counterclaim in the 2018 Action, it submits it made it clear when the 2020 Action was commenced that it sought to avoid a multiplicity of proceedings issue. CCSI’s counsel wrote to the respondents’ counsel stating: “We will of course not be pursuing the paragraphs in the present counterclaim dealing with this same issue and will agree to have them removed when we reconvene. It seems to me once you get your head around it, all [the] actions should be consolidated or heard together”.
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[9] While the motion judge understandably viewed amending the counterclaim as preferable, in our view he erred in dismissing the 2020 Action against Westin as an abuse of process. It was common ground that there was no valid claim for money owing to CCSI by Westin in the counterclaim in the 2018 Action, as CCSI was not a party. A consequence of this was that the limitation period for CCSI’s claim continued to run. The 2020 Action was commenced to preserve that limitation period. And it did not necessarily create a multiplicity of proceedings if appropriate steps were taken to ensure the claim was not advanced in two proceedings. . SS & C Technologies Canada Corp. v. The Bank of New York Mellon Corporation
In SS & C Technologies Canada Corp. v. The Bank of New York Mellon Corporation (Ont CA, 2021) the Court of Appeal considered whether an appeal on the liability portion of a trial should proceed before the damages trial had been completed. Normally, appeal courts want to have all the issues before them to avoid a 'multiplicity of proceedings' [CJA 138]:[31] Section 138 of the Courts of Justice Act, R.S.O. 1990, c. C.43 (“CJA”), makes clear that “[a]s far as possible, multiplicity of legal proceedings shall be avoided”; see also Vaeth v. North American Palladium Ltd., 2016 ONSC 5015, at para. 37. This court held in Elcano Acceptance Ltd. v. Richmond, Richmond, Stambler & Mills (1986), 1986 CanLII 2591 (ON CA), 55 O.R. (2d) 56 (C.A.), at p. 5, that the power to split a proceeding “must be regarded as a narrowly circumscribed power.”
[32] Courts generally seek to avoid a multiplicity of proceedings and the potential of inconsistent results. One appeal dealing with all issues is ordinarily the most effective and fair use of both public and private resources: Korea Data Systems (USA) Inc. v. Aamazing Technologies Inc., 2012 ONCA 756, 29 C.P.C. (7th) 51, at paras. 23-25.
[33] This is particularly true when there is a real possibility that one or both parties may bring further appeals of the application judge’s decision: Toronto (City) v. 1291547 Ontario Inc. (2001), 2001 CanLII 7244 (ON CA), 148 O.A.C. 212 (C.A.), at para. 13.
[34] In Toronto (City), the respondent moved to adjourn the trial for damages until its appeal on the trial judge’s finding of liability had been heard. This court held, at para. 13, that the balance of convenience supported the completion of the adjudication of all the issues in the Superior Court of Justice, as then both the liability and damages issues could be dealt with in one appeal.
[35] In Korea Data Systems, this court heard an appeal of a liability decision, while a hearing on damages and other outstanding issues was scheduled concurrently by the court of first instance. This court held that the “interests of justice” favoured staying the appeal to allow the damages hearing to be completed first, as this approach “avoids a multiplicity of proceedings and the potential of inconsistent results”: Korea Data Systems, at para. 23. Notwithstanding that the issues on appeal were serious, the issues were separate and discrete from those remaining to be determined at first instance, and little prejudice would result in allowing the appeal to proceed, this court held that the overall interests of justice favoured the disposition of all issues before hearing the appeal: Korea Data Systems, at paras. 23-25.
[36] In Canadian Planning and Design Consultants Inc. v. Libya, 2015 ONCA 661, 390 D.L.R. (4th) 267, this court held, at para. 53, that “[i]t is not an efficient or appropriate use of judicial resources to have two different courts determining the merits of the same issues in what is essentially the same litigation, especially where multiple appeals to this court may result”. The concerns of judicial economy and avoiding the risk of inconsistent rulings were held to favour adjourning the appeal pending resolution of a motion in the Superior Court of Justice: Libya, at para. 53.
[37] Where the only harm the appellants might be exposed to is the expense they would incur if the trial went ahead before the appeal and this court on appeal determines that there was no proved breach, the harm suffered by the appellants can be taken into account in costs or damages: Toronto (City), at para. 11.
[38] As noted in the cases cited above, the ordinary practice is to pursue a single appeal from decisions on liability and damages. The moving party must establish that it is in the interests of justice to do otherwise. Fragmenting appeals, particularly in large and complex cases such as this, may well delay the overall administration of justice at both the trial and appeal court level by having appeals of different aspects of the case heard at different times.
[39] I recognize that the appellants have raised serious issues in their appeal of the Liability decision and, if successful, the appeal may dispose of some or all of the claims. However, if the Liability appeal is scheduled now, there will be a multiplicity of proceedings being heard and resolved concurrently.
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