J. 1986 S.H. No. 57202 IN THE SUPREME COURT OF NOVA SCOTIA BETWEEN: SKIPPER FISHERIES LIMITED, body corporate and WAYNE THORBOURNE, CLAUDETTE THORBOURNE, THOR SEINERS LIMITED, body corporate, PHOENIX FISHERIES LIMITED, body corporate, PAUL EDWARD BLADES, BRIAN ARTHUR BLADES, CLIFFORD V. GOREHAM, and S. CLIFFORD HOOD DECISION HEARD: Before the Honourable Justice D.W. Gruchy in Halifax, Nova Scotia, on November 8, 10, 15, 22, 23, 30, December 1, 2, 16, 22 and 23, 1993 DECISION RELEASED: April 18, 1994 COUNSEL: Douglas A. Caldwell, Esq., Q.C., and Lloyd I. Berliner, Esq. Counsel for the plaintiff Robert G. Belliveau, Esq., Q.C., Christopher C. Robinson, Esq., and J. David Connolly, Esq., Counsel for the defendants Phoenix Fisheries Limited, Paul Edward Blades, Brian Arthur Blades and Clifford V. Goreham Thomas E. Pittman, Esq., Counsel for the defendants WayneThorbourne, Claudette Thorbourne and Thor Seiners Limited James L. Connors, Esq., and David Bright, Esq., Q.C., Counsel for the defendant S. Clifford Hood GRUCHY, J. Introduction At the opening of Court before the commencement of the trial of this action the defendants Phoenix Fisheries Limited, Paul Blades, Brian A. Blades and Clifford Goreham (collectively, Phoenix) applied for the dismissal of the action pursuant to Civil Procedure Rule 20.09 which provides: 20.09 (1) Where party fails to make discovery of or produce for inspection any document under an order or Rule 20, he is liable to be punished for contempt, and if plaintiff, to have the proceeding dismissed, or if defendant, to have the defence struck out. (2) Where it appears that there has been failure on the part of party or his solicitor or, in the case of the Crown or body corporate, or an officer thereof, to make reasonable effort to give full discovery of all documents that relate to any matter in proceeding, the court may impose on the party, solicitor, or officer such terms or penalty as it thinks just. This application was made before Skipper called evidence. The basis of the application is that Skipper had failed to make reasonable effort to produce documents and information and to give full discovery relevant to the matters in issue. Phoenix and Skipper called various witnesses on this application and all parties have participated in the examination and cross‑examination of them. All parties have made oral submissions, supplemented by written briefs. Background In the action Skipper claims to have been deprived of its interest in fishing vessel, Sealife III, and the contribution to overhead and profit margin which that vessel would have made to Skipper's seafood plant by its landings. While the means by which the alleged deprivation is not directly involved in this application it will be necessary to touch upon the methods of quantification of the alleged loss employed by the parties' experts and to relate that information to the production‑of documents and discovery by the plaintiff. The cause of action, according to the pleadings, first arose in 1985. The action was commenced on June 27, 1986, and the pleadings appear to have closed in 1989. In view of the anticipated lengthy trial, the matter was assigned to me for case management. Various management meetings were convened and the date for the commencement of trial was set for November 1, 1993. The trial was to be of two months' duration. The plaintiff retained the chartered accountants, Doane Raymond, to prepare report on the alleged loss occasioned to it by the defendants. report dated March 31, 1992 has been filed. The defendants retained Mr. Grant Thompson, chartered accountant, on April 23, 1993 to review the Doane Raymond report and to make such investigations into the alleged loss as he deemed necessary or advisable. During the various pre‑trial meetings it was apparent that the defendants had experienced difficulties in obtaining the report needed. The reasons for this difficulty were not apparent to me until the eventual application made at the opening of trial. At the various pre‑trial conferences and applications for adjournment, pressed counsel to continue efforts for trial as scheduled as rescheduling two‑month trial might require an adjournment of year. The requests for adjournment were stated to have been necessitated by Mr. Thompson's inability to obtain information from Skipper for the preparation of his report. It was revealed to me during the pre‑trials and during this application that Mr. Thompson sought information which he considered vital in the calculation of the value of the Sealife III landings and the contribution that they would have made to Skipper's margin. Mr. Thompson had dealt with Mr. Douglas Murdock, the vice‑president, finance and administration of Comeau Seafood Group which includes Skipper. Mr. Thompson had inquired of Mr. Murdock as to the method Skipper used in calculating compensation to fishermen for the fish delivered to the plant. Mr. Murdock gave Mr. Thompson information to the effect that Skipper did not have record of the weight of raw fish received. Rather, Mr. Murdock told Mr. Thompson of its method of calculating the payment due to fishermen, but which method caused Mr. Thompson lot of difficulty. He was given to understand that certain information which he sought simply was not available. During discovery of Mr. Thompson, through questions directed to him, it was revealed that Skipper had information which Mr. Thompson felt he had been led to believe did not exist. That led to applications to adjourn and eventually to this application. At an application to adjourn, which refused, ordered the parties to meet together with their experts and to determine the precise information requested and what was available. am informed by affidavit (Iater acknowledged in evidence) that during that meeting Mr. Murdock informed the defendants that fish were not weighed on receipt at the Skipper plant and that there were no truck scales. There were no records of the weight of fish received. While still not understanding the full significance of the allegations being advanced by the defendants, and in order to attempt to salvage the time set aside for this trial, severed the issues of liability and quantum for the purposes only of receiving evidence, but on the understanding that would not make any determination as to liability until had heard all the evidence concerning quantum. Defence counsel submitted that the evidence concerning quantum would have an effect on the question of the credibility of Skipper and its officers. At the scheduled opening of the trial Phoenix asked for and received permission to make this application and to call evidence in support of it. The anticipated evidence was outlined to me and decided to hear it. While the evidence outlined appeared to be relevant to the matter of quantum, concluded that it was relevant also to the subject matter of the application. Two truck drivers were then called by Phoenix one an employee of Skipper and the other an independent contractor. They established to my complete satisfaction that truck scales were located, maintained and used by Skipper at its plant. There was an established practice of weighing herring on arrival at the plant. Notes were made in the scale house by the truckers of the weight and origin of the fish as it was received. In reply to that evidence, Skipper called Mr. Marcel Comeau, the President of Comeau Seafoods limited, which company is the owner of Skipper. He acknowledged the existence of the scales, but said that he had not been aware of their ongoing use. He only became aware of the ongoing use of the scales at or about the time the trial was to begin. He then gave evidence which brought to the fore the whole matter of the method of calculating payments to the fishermen. His evidence was to the effect that the weight of herring received at the plant is not relevant to the calculation of compensation and is therefore not relevant to the case as whole. That evidence crystallized the dichotomy between the parties as to the methods to be used in calculating alleged damages arising from the loss of the Sealife III contribution to the Skipper margin. will not dwell on the methods of determining compensation for the fishermen in any detail, but it is clear that one must be used to calculate the value of the Sealife III landings. which Skipper says ought to have gone to its plant. Skipper says that in the operation of its plant it does not concern itself with the weight of fish received and that only the production yield of the fish landed is relevant. Skipper knows the weight of its product produced from any given load of fish and applies formula to that weight, which formula includes factors of management discretion as to the quality of the fish received and the amount of trash (rejected species) fish, and thereby determines notional weight of the fish received. That notional weight is then used in determining the compensation for the fishermen. Mr. Comeau said there is no direct relationship between the notional weight (paid weight) and the landed weight. According to Mr. Comeau, any requests by the defendants for landed weight were requests for irrelevant information. Mr. Grant Thompson, on the other hand, when he commenced his investigation, wanted to know what method of calculating compensation was used by Skipper; he had understood that the industry uses one of two methods, either on the basis of whole weight or on the product produced. Mr. Thompson said he was informed by Mr. Murdock that Skipper did not use either method. Mr. Thompson, however, was faced with the problem of relating the gross landings of Sealife III during the period in question to the value of those landings to Skipper; there had to be devised method to determine that ratio. He only had the gross weight of the Sealife DI landings and that had to be related to value to Skipper. He was not given sufficient information to make that determination. In fact, Mr. Thompson produced report which ultimately had the effect of underlining the problems created by the lack of information needed to correlate the Skipper method with the Sealife III landings. Mr. Thompson, using the statistics and information supplied to him by Skipper and Mr. Murdock, together with certain industry standards, concluded that large quantity of raw material was unaccounted for. Further discovery examinations of Mr. Thompson and Skipper employees conducted even during the hearing of this application led to an apparent impasse on the correct methods of calculation and great deal of confusion as to what information Skipper actually had. The retrospective calculation of landings using the method said to be employed by Skipper to calculate the paid weight of the fish landings, according to Mr. Thompson, led to the conclusion of an improbably (if not impossibly) efficient production, or (I add) to the conclusion that the weight of the landings was greatly understated by the use of such method. The conflicting evidence and positions of the parties presented to me at this application make it necessary to make certain findings of fact and credibility. If find the plaintiff's evidence credible and acceptable, then the matters or questions involved in this application are resolved and may conclude that it had produced the information reasonably required of it and such other information requested is not relevant. am unable to do that for the reasons now set forth. Mr. Comeau's Evidence Mr. Comeau's evidence was unsatisfactory. find as fact that when Mr. Thompson had first met with Skipper he made it abundantly clear that he wanted to know the weight of the raw material received at the Skipper plant. find that Mr. Comeau had to know of the existence of the scales and their use. He bad to know of the record of that raw material. He said that the weight information was obtained and given to the fishermen for their benefit only. He gave no satisfactory explanation of that observation. He had either unilaterally concluded that the information sought by Mr. Thompson was irrelevant, or that for other reasons it would not be produced. reach these conclusions because: 1. The truck scales were used whenever they were in working condition and while Mr. Comeau said there were periods when difficulty was experienced with them, they were apparently then repaired; 2. The truckers delivering fish went to considerable trouble, time and consequently expense to obtain and record an accurate record; 3. The records produced by the weighing procedure were used in manner not made clear to me in settling accounts with the fishermen; 4. Accounting staff of Skipper knew of and used the data recorded from the weighing procedures; 5. Considerable effort was expended to keep the records which, although they have an informal appearance, did appear to be carefully done and kept. Mr. Comeau did not mention in his testimony before me the existence of any records of fish deliveries to the Skipper plant. During adjournments of the hearing of the evidence on this application, however, the parties continued their discovery examinations of various witnesses about the existence of records of weights of raw material received. During these discoveries it was revealed that there was set of scribblers in which Skipper employees kept record of herring receipts. That evidence was revealed in examinations of Skipper employees conducted after Mr. Comeau had given his evidence. The fact that Mr. Comeau did not mention the existence of this record is, to my mind, significant. Two possible explanations exist for this failure: 1. Mr. Comeau did not know of their existence; but as the controlling officer of Skipper he should have known of them; or 2. Mr. Comeau did know of them and decided not to reveal them. Either explanation is contrary to the spirit and intent of the Civil Procedure Rules. In addition, Mr. Comeau had reviewed Mr. Murdock's affidavit filed herein wherein it was stated that the number of pounds of herring taken in by the plant was not recorded. At that point Mr. Comeau, or Mr. Murdock, was under the distinct obligation to reveal that information which was subsequently found in the scribblers whether it was accurate or not and to give whatever explanation was necessary. On Mr. Comeau's review of Mr. Murdock's affidavit, he knew or ought to have known that the information contained in and put forth by it was either inaccurate or untruthful. As the spokesman of Skipper, be was under an obligation to inform himself fully of the relevant facts. He either ignored the incorrect information, did not detect it or decided to go along with deception. Neither explanation is acceptable in terms of required disclosure. There is worrisome aspect of Mr. Comeau's evidence which plays part in my decision. When fishing captains arrive in port with their catch they are required to file report with the Department of Fisheries and Oceans. That report's first figure is the "hail weight" of their catch. That is the captain's estimate of the weight of the catch. The next figure on the report is the "true weight" which is to be supplied by the processor in this case, Skipper. Mr. Comeau was "generally aware" of this practice. He also knew that the true weight reported was the weight the fishing captain instructed the processor to report. It is not true weight at all, but rather, fictitious figure used by the captain for his own purposes. Mr. Comeau attempted to justify that practice as being within the industry standard an explanation which may be true but which must be rejected. Mr. Comeau said that the true weight "...is what the fishermen caused to be reported to the Department of Fisheries and Oceans...it might be combination of factors, but more of the time it would be what he could get away with, as fair way of putting it" ...as little as possible. This evidence was, at the least, clear indication of lack of responsibility. That evidence combined with the evidence adduced subsequent to Mr. Comeau's testimony about scribblers in which weight records were kept poses real question as to the reliability of the testimony as whole. Counsel for Skipper have urged that there is no evidence before me that it was Skipper or Skipper's employees who supplied the fictitious true weight. The only such report or reports before me were not apparently signed by Skipper. The thrust of Mr. Comeau's evidence, however, is clear and draw the conclusion that Skipper probably like other processors participated in this practice. Douglas Murdock's Evidence Mr. Murdock's evidence was less satisfactory than that of Mr. Comeau. Mr. Murdock must have known what information Mr. Thompson sought as he commenced fact‑finding for his report. Mr. Murdock had been detailed to calculate the business loss arising from the loss of the Sealife III landings and had initially attempted that calculation using the same method adopted by Mr. Thompson or one very much like it. Vital to that calculation was the weight of the fish received. Mr. Murdock said he had inquired of the Skipper manager, Mr. Douglas D'Eon, and was informed that Skipper did not weigh the fish coming into the plant. He told Mr. Thompson, in the presence of Mr. D'Eon, that there were no records of the weight of fish received. Both assertions appear patently untrue. Mr. D'Eon's evidence on discovery is clear that Mr. Murdock did not inquire about the truck scales or about the practice of weighing fish on delivery until after this application was under way. He also seriously misled Mr. Thompson on the use and value of roe‑extracted herring carcasses for producing herring fillets. His explanation to the Court of the information given to Mr. Thompson was not credible; that was the explanation that while the production of fillets from roe‑extracted herring had been significant in one year, it was not significant over longer period of time. That explanation showed lack of candor by Mr. Murdock to Mr. Thompson, if not an intention to mislead. Skipper sought to explain the non‑use of the weight of fish received as it did not take into consideration the trash fish which had to be rejected after weighing. That explanation was unsatisfactory. The discovery evidence tendered to me showed that the weight of the trash fish was estimated on discharge from the plant. Mr. Murdock's evidence before me concerning the calculation of compensation for roe herring was also unsatisfactory. It is difficult again to understand why estimates of weight would be used when the fish is being weighed on arrival at the plant, unless, of course, the estimates, like the reports to the Department of Fisheries and Oceans are understated. Mr. Murdock lacked credibility when he sought to distance himself from the filing of deceptive reports with Department of Fisheries and Oceans. The fact of the matter was that Skipper participated in that activity, whether Mr. Murdock was directly involved or not. Mr. Murdock said that all requests by Mr. Thompson for information were complied with. But when Mr. Thompson asked for such matters as "yields" and related data, the necessity for raw material data was at least impliedly necessary, and probably express. As it developed, at least some of that data was available, should have been produced but was not. Murdock Thompson Credibility There are marked differences between the evidence of Mr. Murdock and Mr. Thompson, especially in relation to what information Mr. Thompson requested of Skipper. All such differences have resolved in Mr. Thompson's favour. Almost without exception, Mr. Thompson's evidence was consistent within itself and with other objective evidence available to me. Mr. Murdock's testimony cannot be so described; rather, it was inconsistent within itself, with the evidence of other Skipper employees given on discovery and with objective evidence. Wherever there is any difference between the evidence of Mr. Murdock and Mr. Thompson and any material particular, accept the latter. In reaching that conclusion, have kept in mind that Mr. Thompson did on one or more occasions overstate the amount of "research" he had performed in the preparation of his report, but such overstatements do not affect my assessment of ultimate credibility on essential matters. Additional Discovery Evidence On November 23 the hearing of this application was adjourned while Mr. Thompson was being examined. Due to his required attendance at court in New Brunswick the adjournment was of several days duration. In that interim period examination in discovery continued in relation to the evidence given by Mr. Comeau and Mr. Murdock. am informed that Skipper's employees Mr. Douglas D'Eon, Mr. Bennie D'Entremont and Mr. Raymond John Panter were examined. Portions of the transcripts of their discoveries have been produced by Phoenix and Skipper and have reviewed them in detail. will not draw conclusions of the credibility of those witnesses. Their evidence, however, has been helpful in understanding the processes involved in this case. Their evidence has also been invaluable in the evaluation of the evidence of Messrs. Comeau, Murdock and Thompson. D'Entremont and D'Eon both gave evidence in discovery of the weighing of herring as it was received at the plant and the method used to do so. They also testified as to their contribution to the record‑keeping involved in the operation. The evidence concerning the records kept in the scribbers by D'Eon was only produced after specific questions were asked; that is, the scribblers were not mentioned or produced until November 26, when as result of specific questions, they were produced. The scribbler records were kept on daily basis, between the efforts of D'Entremont who gathered the raw information and gave it to D'Eon who then entered it into the scribbler. Skipper questions the accuracy and validity of the scribbler information. The fact of the matter is, however, that the information was gathered and recorded in the ordinary course of business. It really did not matter whether the weights of fish received were actual or estimated. The scribblers contained at least some of the information sought by Mr. Thompson and Mr. Murdock ought to have known of their existence and in view of Mr. Thompson's inquiries of him ought to have produced them for inspection. If Mr. Murdock did not know of their existence or did not know of the existence of the data contained in them, he ought to have informed himself before the commencement of his discovery. find it equally difficult to accept that Mr. Comeau did not know of the existence of the record or at least of the data. The accuracy of the information should not have impacted on the decision as to whether it ought to have been produced; that was matter to be tested and explored during discoveries or at trial. There was also evidence of the weight of the discarded fish mentioned above which has apparently not been produced. The plaintiff's position is that only the weight of the usable fish is relevant and that is determined by working backwards from the weight of the finished product. The evidence produced at the discovery of D'Entremont showed that record of the weight of the fish received was kept in the scribblers and the weight of the discarded fish was estimated from the volume of the trash fish trucked away to processing plant and recorded on system of "whiz‑slips". That information was also the type of data which ought to have been recognized by Mr. Murdock as that sought by Mr. Thompson. The information contained in the scribblers was considered by the plaintiff's own staff in its own cost analysis and in determining the amounts owed to the fishermen. Skipper's local accountant, Mr. Panter, used the information in the scribblers to check the invoices received from the fishermen. Indeed, Mr. Panter referred to 'Doug's scribbler" to obtain fish tonnages for the agreed purchase of fish. He entered the scribbler data into his computer. Although the scribblers were not produced to the defendant until November 26, 1993, the significance of the information contained in them relative to this lawsuit was recognized by the plaintiff's staff in 1990. Mr. Panter was then instructed by his superiors to prepare report concerning the loss of Sealife III's contribution to margin and was told to get the required information from the scribblers. Mr. Panter prepared report which was apparently discarded by the plaintiff as not being useful. That may well have been the case, but the important fact is that the first source of information considered was the scribblers. It is fact that Mr. Thompson asked Skipper for the information listed in paragraph 11 of his affidavit as follows: 1. the production summaries by month, tying into sales of each product for the years 1985 through 1990; 2. justification of prices for raw fish and backup invoices for the year 1985; 3. copy of the company general ledger showing direct labour for the period 1985 through 1990 and payrolls for the months of June and September of each year in question; 4. information concerning financing charges mentioned in the Doane Raymond report attributed to the Plaintiff company; 5. details of inventory of fish product held for the years 1985 through 1990; 6. selection of invoices for one year for salt, supplies, electricity and maintenance charges; 7. summary of the raw material used in the processing carried out by the plant for the years in question. Mr. Thompson says, and accept, that he was not supplied all the information he requested. Mr. Panter's discovery evidence is to the effect that information was available but not obtained. There may be question of the accuracy of the information which Mr. Panter would have been able to generate, but that was for counsel to explore during production of information and discoveries or interrogatories. It is obvious from the discovery evidence of Mr. D'Eon, Mr. d'Entremont and Mr. Panter that Skipper, through Mr. Murdock, had not made the required effort to obtain information requested by Mr. Thompson. In this regard find that Mr. Thompson had made it sufficiently clear to Mr. Murdock the information sought and it is equally clear that Mr. Murdock either did not make the required effort to obtain it or chose, rather, to filter the information supplied. Scribblers Weights Skipper had been obviously reluctant to produce the scribblers which contained record of weights of fish. While some questions or discrepancies seem apparent, it is clear that these books are record of weights of fish arriving at the plant. The scribblers are well kept and the entries appear to be carefully done. have considered the evidence given by Mr. D'Eon on discovery. It is apparent from the written transcript that Mr. D'Eon was evasive about the records, their meaning, their origin and their purpose. Yet the record had been carefully preserved and had been relied upon by other employees of Skipper. These facts must be considered in the context of Mr. Comeau's evidence of the deliberate participation by Skipper in the misreporting of catches to the Department of Fisheries and Oceans and Mr. Murdock's untruth about the existence and use of scales. Skipper's position is that the fishermen are paid on the basis of the production achieved from any given load of fish, but there is suggestion from the combined use of the scribblers and the invoices that it is far more likely that the fishermen' compensation was in direct relation to the size of the catch. Indeed, it is hard to conceive that fisherman would consent to sell his catch to fish plant, trust himself to the efficiency and conscientiousness of the employees of the plant and be paid only on what yield the plant managed to get. How then could the records of the calculation of the fishermen' compensation be maintained without originating record which will reflect the actual weight of catches? The obvious solution is to create an equation, the result of which will be to produce the compensation required without displaying the actual catch. That can be easily achieved by setting down the weight produced, modified by factors which appear to reflect the quality of the catch and the productivity achieved (both of which are variables) and which then produces the compensation required to be paid. The report to the Department of Fisheries and Oceans would be therefore satisfied and the fishermen would receive the compensation they had earned. Until the plant had received an invoice for the fish which it could approve, however, there had to exist some record of the fish actually received. Hence, the innocuous scribbler records would have been vital. Law Civil Procedure Rule 20 is clear and unequivocal. Litigants must make full and timely disclosure of documents. The adoption of this Rule was milestone in the road away from "trial by ambush" to the present. Production and discovery were foreign to the adversary process of adjudication in its earlier history when the element of surprise was one of the accepted weapons in the arsenal of the adversaries. This applied to both criminal and civil proceedings. Significantly, in civil proceedings this aspect of the adversary process has long since disappeared, and full discovery of documents and oral examination of parties and even witnesses are familiar features of the practice. This change resulted from acceptance of the principle that justice was better served when the element of surprise was eliminated from the trial and the parties were prepared to address issues on the basis of complete information of the case to be met. R. v. Stinchcombe, (1992) 1991 CanLII 45 (SCC), 130 N.R. 277 (S.C.C.) per Sopinka J., at 282. The late Chief Justice Cowan, who oversaw the adoption of the Rules as they presently exist, said of Rule 20: The purpose of this rule is to provide full disclosure prior to trial, of all relevant documents in the possession, custody or control of party. Kynock et al v. Johnson (1975), 20 N.S.R. (2d) 586 at 588. See also McRae et al v. Historic Properties Ltd. et al (1988), 89 N.S.R. (2d) 201, and C.M.H.C. v. Foundation Co. of Can. et al (1984), 63 N.S.R. (2d) 403. The failure of party to produce documents has attracted the sanction of the Court, including the dismissal of actions or the striking of defence. See: Church of Scientology of Toronto v. Maritime Broadcasting Co. Ltd., (1989), 33 N.S.R. (2d) 500; Kynock et al v. Johnson (supra); Halifax (County) v. Fancy (1992), 115 N.S.R. (2d) 196; and Kin Franchising Ltd. v. Donco Limited, (1993), 14 C.P.C. (3d) 193 (Alta. C.A.). Of those cases, however, those which resulted in dismissals, involved repeated failures to obey specific orders of the Court for production, refusals to attend for discoveries and failures to live up to specific undertakings. In my view the failures of the plaintiff here fall short of the flagrant disregard for the Rules considered in those cases. American case law is more developed in the consideration of litigation abuse. have had cited to me as examples the following: National Hockey League et al v. Metropolitan Hockey Club Inc. et al (1976), 427 U.S. 639; Cine Forty, Second Sheet Theatre Group v. Allied Artists Pictures Corp. et al (1979) 602F (2d) 1062; Founding Church of Scientology v. Webster (1986), 82F. 1448 (D.C.Crt.); Morgan v. Massachusetts General Hospital (1990), 901 (2d) (1st Crt.). The text, Sanctions, the Federal Law of Litigation Abuse by Gregory P. Joseph (Michie Company, 1989) sets forth at p.449 list of factors for consideration where there has been failure by party to comply with the Rules: 1. Dismissal or Default The court has discretion to dismiss an action or enter default judgment as sanction for any of the violations set forth in Rule 16(f). Among the factors that the court considers in deciding whether to enter an order of dismissal or default are: 1. The extent of the party's (as opposed to counsel's) personal responsibility for the violation; 2. The prejudice to the adversary caused by the violation; 3. Whether there is clear record of delay or contumacious conduct by the offender; 4. Whether the offense was wilful or in bad faith; 5. Whether the purpose of the sanction can be substantially achieved by use of less drastic alternative; 6. The merits of the claim or defense that would be stricken; and 7. The prejudice to the court caused by the violation. One of the most remarkable aspects of the reported Rule 16(f) case law is the prevalence with which dismissal or default is ordered. This may reflect nothing more than the courts' disinterest in writing opinions dealing with lesser sanctions, or perhaps parties' disinclination to appeal them. Whatever the explanation, the result is rather developed body of law concerning the factors to be taken into account by the courts in deciding whether to order dismissal or default. Dismissals with prejudice or defaults are drastic sanctions ‑‑ termed "extreme" by the Supreme Court in National Hockey League v. Metropolitan Hockey Club, Inc., 427 U.S. 639, 643 (1976) (Rule 37 case) ‑‑ and may properly be imposed only as last resort. Poulis v. State Farm Fire Gas Co., 747 F.2d 863, 867‑68, 870 (3d) Cir. 1984); Callip v. Harris County Child Welfare Dep't, 757 F.2d 1513, 1519 (5th Cir. 1985); Ford v. Fogarty Van lines, Inc., 780 F.2d 1582, 1583 (11th Cir. 1986). See also Shea v. Donohoe Constr. Co. 795 F.2d 1071(D.C. Cir. 1986). Because of its harshness to the client, the courts scrutinize the various factors set forth above and any others they deem relevant. Not all of the listed factors need to be present in order to sustain dismissal or default sanction. The judge's decision is discretionary and based on the totality of the circumstances before him or her. The case before me is not one in which the plaintiff might have been taken by surprise by the documents which it unexpectedly found to be relevant. This action was commenced six years ago and from its initiation the matter of the calculation of Sealife III''s contribution to margin was relevant. The plaintiff has undoubtedly been pressed for time in the last month or so prior to trial, but that does not excuse its previous inactivity. It is this regard than the present case is distinguished from Visa International Service Association v. Block Bros. Realty Limited [19831 N.W.R. 665 (B.C.S.C.T.D.) Conclusion In the circumstances of this case conclude that the plaintiff has not complied with Civil Procedure Rule 20.09(2) in that it has failed "...to make reasonable effort to give full discovery of all documents that relate to any matter in proceeding...." While such failure is serious and with very considerable financial implications, I am not persuaded that it was of such a degree of contumacious conduct as to warrant dismissal of the action. Nor do I conclude that its failure warrants a dismissal of any damage claim arising from loss of contribution to margin. conclude that the appropriate remedy is to recognize that the plaintiff has incurred wasted costs and to redress that subject, but allowing the action to continue. The plaintiff will be liable for: (a) Costs to date on solicitor‑client basis of each of the defendants for all time spent on this particular application and reasonable time spent in preparation for it; (b) Costs to date on solicitor‑client basis for all discoveries (or portions thereof) dealing with the matter of the weight of fish received at the Skipper plant and any other time spent to date on attempts to quantify the alleged loss of Sealife III's contribution to margin; (c) All throw‑away costs incurred by Mr. Grant Thompson in the preparation of his report. In regard to each of the three areas of costs, recognize that certain amount of work will be of value to the defendants in any event. It is not my intention that the defendants will be compensated for work done which will be of value to it in the course of an eventual trial. am sure that the delineation of such costs will present difficulties which would best be resolved by familiarity with the case. ask that the parties first attempt to resolve any questions or issues arising from this ruling and then, if necessry, will supervise the taxing of costs. will at that time be able to determine if any special considerations should be given to any party relative to costs. Objections to Discovery Evidence During the course of reading in certain discovery evidence disagreements developed between the parties as to the admissibility of answers to leading questions put to witnesses by his own counsel on re‑direct examination. In view of my conclusion reached above those questions are now largely moot. will, however, state my understanding of the problem and the law. need not review each question and answer objected to; that would be wasteful process because each would have to be put into the context of hundreds of pages of other questions. Civil Procedure Rule 18.14(1) and (2) reads: (1) At trial or upon hearing of an application, any part or all of deposition, so far as admissible under the rules of evidence, may be used against any party who was present or represented at an examination for discovery, or who received due notice thereof, for any of the following purposes, (a) to contradict or impeach the testimony of the deponent as witness; (b) where the deponent was party, or an officer, director or manager of party that is corporation, partnership or association, for any purpose by an adverse party; (c) where the deponent is dead, or is unable to attend or testify because of age, infirmity, sickness, or imprisonment, or is out of the jurisdiction, or his attendance cannot be secured by subpoena, or exceptional circumstances exist that make it desirable in the interest of justice to allow the deposition to be used, for any purpose by any party. (2) If only part of deposition is offered in evidence by party, an adverse party may require the introduction of any other part which is relevant to the part introduced, and the other party may introduce any further part. The witness D'Eon was an employee of the plaintiff, directly involved in an aspect of the plaintiff's operation significant to the matters in issue. He was examined by defendants' counsel. The form of that examination was wide and had the appearance of cross‑examination. That is undoubtedly the acceptable form of asking questions on discovery in Nova Scotia. Counsel for the plaintiff then examined Mr. D'Eon. Many of the questions objected to were unquestionably leading in that they: (a) called only for "yes" or "no" answer; or (b) suggested the answer; or (c) suggested fact which bad not been established. Defence counsel have submitted, therefore, that the plaintiff was not entitled to ask such questions of witness as the evidence so elicited was not admissible under the Rules of Evidence. Plaintiffs counsel has submitted that answers to leading questions may be read in to explain or qualify answers given under direct examination and disovery. He cites in support of his position Williston and Rolls, The Conduct of An Action (Butterworths, 1982) at p.79: question may be objectionable as leading on one of two grounds: (I) if it suggests the answer desired; or (ii) if the question assumes controverted fact about which the witness has not testified. However, not every question would suggest the answer is improper, and not all leading questions are objectionable.... What is leading question is not easily answered, because there is no absolute prohibition against it. On many occasions leading questions are not only proper but are to be recommended and, in other instances, what might have been leading question if looked at in isolation is not leading because of the context in which it was put. This is so because it is not always possible to tell whether question is leading without considering the evidence as whole. Thus 'leading' is relative, not an absolute term. There is no such thing as 'leading' in the abstract for the identical form of question which would be leading of the grossest kind in one case or state of facts might be not only unobjectionable, but the very fittest mode of interrogation in another. And at p.80: The general rule is not that no leading question may be asked, but rather that on material points in issue, one must not lead his own witness. But on points that are merely introductory and form no part of the substance of the inquiry, one should lead. If disputed fact is inserted as part of the question and the witness must assume such fact in order to answer the question, the question is leading. Mr. D'Eon was witness obviously allied to the plaintiff. Questions had been asked of him by defence counsel which elicited answers potentially harmful to the plaintiffs position. Some of the questions asked by the plaintiffs counsel suggested answers contrary to, and in some cases negating, the previous response. have considered that such questions and answers are inadmissible. do not consider unacceptable questions which lead in an introductory matter, recapitulate point in evidence, direct attention to particular point or to another witness's testimony, Indeed, such questions are not considered cross‑examination. Where, however, the question is leading and suggests answers on an important point, have for my purposes ignored that evidence. consider that D'Eon, as an employee of the plaintiff; should be governed by much of the same considerations as party. Choate's Discovery in Canada (Carswell, 1977) at p.150, states: (f) Re‑examination by own counsel A586 person examined for discovery may be further examined by his own counsel in relation any matter respecting which he has been so examined. It is an explanatory examination and is for no other purpose than to enable person who has been examined to give such explanation on further examination by his own counsel as may appear to be necessary for the purpose of making clear the matters upon which he has already been examined. The witness may by way of explanation add to the facts already given even though it may result in variation or change in his evidence. In this case many of the questions went beyond request for explanation and suggested the desired response. recognize that Choate refers to the practice in Ontario and there major distinction between the Ontario Hiles and Nova Scotia's Civil Procedure Rules. Mr. D'Eon was not party to the action but in my view he was so directly connected with the corporate party that the prohibition of leading questions ought to apply. In any event, those questions and answers objected to would not have changed the result of this application. The Continued Action recognize fully that the conclusions have reached in this application are based on partial information only; that is, they are not based on full trial. My conclusions with respect to credibility and facts should not be confused with the findings of fact and credibility necessary in the final determination of any cause of action. am satisfied, however, that in order to reach an appropriate conclusion in this particular application, findings of fact and credibility were essential. Therefore, this decision, while it will be printed and available to counsel, will not be placed in the file in the usual fashion and it will not be available for consideration until the trial is completed. There will be two orders granted. One will give the full effect of this decision which will be sealed with the decision. The other, public order, will simply order the trial be adjourned without day. The findings of fact and credibility which make now ought to prevent me from continuing to sit on this case. As this is an application made prior to the commencement of the trial, do not consider myself seized with the matter. Counsel are encouraged to approach Chief Justice Glube to obtain the assistance of case management for the furtherance of the matter. J. Halifax, N.S.
The defendants applied at the opening of the trial for dismissal alleging the plaintiffs had been misleading and had deliberately failed to disclose important information. Dismissing the application, that while the plaintiffs had failed to comply with Civil Procedure Rule 20.07, dismissal of the action was not warranted. The plaintiff was held liable for solicitor-client costs associated with the application and discoveries.