For those looking for more answers on why civil litigation in Toronto is experiencing so many delays, they may lie in the case of
Re Exposoft Solutions Inc. in which a judge ruled on “a motion which should never have been” last week.
The motion followed Exposoft Solutions’ assignment in bankruptcy on Jan. 22, 2009. Bassel Annab, a party related to the bankrupt, made the sole offer to buy its assets for the bargain price of $1,000 back in October 2010. The offer included the company’s intellectual property, but questions arose and the deal stalled as the trustee pondered whether to convey those assets.
In the meantime, Superior Court Justice David Brown approved the sale on Feb. 23, 2012. The order referred to the sale of the “remaining residual assets,” including — but not limited to, according to the judge — those listed in a schedule. But when the trustee sent the draft bill of sale on April 17, 2012, it noted it would convey assets specifically identified on the schedule. “That schedule did not include any intellectual property, in particular trademarks,” wrote Brown in his Sept. 16 ruling in
Exposoft.
Counsel for the parties continued to correspond over the issue, and Annab himself ended up renewing the trademarks as they were about to lapse in December 2012. In May, he got a valuation on the trademarks at a cost of $2,825 that put their worth in the range of nothing to $5,000. This month, he launched his motion — the one “which should never have been,” according to Brown — seeking an order to amend the approval to refer specifically to the intellectual property. At this point, the trustee, Crowe Soberman Inc., didn’t oppose the order, and Annab sought full indemnity costs of $28,136 from the firm.
The case follows recent coverage in
Law Times about delays in the civil courts, particularly in Toronto (see “
Lawyers frustrated as motion delays hit 7 months,” Sept. 16). While lawyers have expressed concerns about case management in Toronto as well as a lack of resources,
Exposoft hints at time wasted on motions the parties could presumably deal with in other ways. In his ruling, Brown laid out an option: “If a dispute truly existed about whether the trademarks formed part of the estate’s assets — a dispute I have difficulty understanding in light of the language of Annab’s offer and his counsel’s February 21, 2012, communication — then a simple procedure existed to deal with the matter: the trustee should have scheduled a prompt 9:30 appointment back before me to clarify matters. Instead, I have before me a motion record, responding motion record, supplementary motion record, factum, and four cases.”
Brown clearly wasn’t happy with how things turned out, particularly given the full-indemnity costs submission of $28,000 on a case worth so little. Ultimately, given the trustee’s “failure to deal with this issue in a timely manner,” he ordered it to personally pay partial indemnity costs of $3,500. It was certainly a reasonable response. The case itself offers further evidence that it’s not just the court system, but also the actions of the parties themselves, that are causing the delays.
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Glenn Kauth
