IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20130924

Docket: M127603

Registry:
New Westminster

Between:

Manjit Kaur Sidhu
and Harpreet Kaur Sidhu

by
her Litigation Guardian Manjit Kaur Sidhu

Plaintiffs

And

Baljit Kaur Hothi
also known as Baljit Hothi and

Bupinder
Singh Hothi also known as Bhupinder Hothi

Defendants

Before:
The Honourable Mr. Justice Jenkins

On
appeal from: A decision of a Master, dated May 29, 2013 (2013 BCSC 939)

Reasons for Judgment

[1]            
This matter is an appeal from the decision of a master in Sidhu v.
Hothi, 2013 BCSC 939, dismissing the defendants’ application to withdraw
admissions of liability made in the response to civil claim and to amend the
response to civil claim.

[2]            
The plaintiffs’ claim arises from a motor vehicle accident which
occurred on July 7, 2008. The defendants admit the negligence of the defendant
driver, Baljit Kaur Hothi, caused the accident. The defendants do not dispute
their liability in any way and do not wish to withdraw that admission.

[3]            
The portion of the response to civil claim that the defendants wish to
withdraw relates to an admission that the plaintiff, Manjit Kaur Sidhu, was
driving the vehicle struck by the defendant and that the other plaintiff,
Harpreet Kaur Sidhu, her daughter, was a passenger in the plaintiff’s vehicle.

[4]            
Subsequent to filing the response to civil claim, the defendants have
obtained evidence of a witness to the accident who has provided a statement
that the driver of the vehicle which was struck by the defendant was a male
person and that male person was the only occupant of the vehicle. In other words,
the defendants wish to allege in an amended response to civil claim that the
plaintiffs were not in the vehicle struck by the defendants’ vehicle and that
their claim is an attempt to make out a fraud on the court.

[5]            
I will firstly summarize the facts before setting out and applying the
standard of review of a master’s decision. I will then consider the merits of
the parties’ respective positions.

I.                
Factual Background

[6]            
As stated above, a motor vehicle accident occurred during the evening of
July 7, 2008. The defendant, Baljit Hothi, was driving on 68A Avenue in Surrey,
BC, and intended to make a left turn onto 126^th Street. While
attempting to make that turn, the vehicle driven by Baljit Hothi was struck by
a 1998 Jeep Grand Cherokee (the “Jeep”) which had been travelling on 126^th
Street.

[7]            
On July 10, 2008, the defendant, Baljit Kaur Hothi, provided a statement
to Heather Howard of ICBC. In that statement, Ms. Hothi made the following
statements, among others:

I thought the car was far away and tried to make a left turn
but the car was coming. I thought the car was too far when I looked and stared
to turn left and all of a sudden the guy came and hit. I thought the
guy was going fast.

Husband was in front of us and had just made the left turn in
front of us. He stopped at 68^th and heard the crash and turned the
motorcycle around and came back. He parked next to our car and was looking at the
other guy.

[Emphasis
added.]

[8]            
The driver of the Jeep did not remain at the accident scene but the Jeep
was subsequently located by a witness, Yaseen Chaudhry, and by the Surrey RCMP.
Correspondence from the Surrey RCMP to counsel for the plaintiffs dated
September 25, 2008, includes a statement that Manjit Kaur Sidhu was contacted
by the RCMP, and that Ms. Sidhu advised the RCMP that she had left the scene as
she was scared. It was also noted that no injuries were reported in the time
shortly after the accident.

[9]            
The plaintiff Manjit Kaur Sidhu also gave a statement to a different
investigator from ICBC on July 25, 2008, in which she stated that she had been
driving the vehicle owned by her husband with her daughter in the front
passenger seat.

[10]        
Also included in the correspondence from the RCMP to counsel for the
plaintiffs were the names of three witnesses to the accident. Their names were
Yaseen Chaudhry, Avtar Gill and Robert Graham.

[11]        
The statement of claim which was issued May 19, 2010, includes an
allegation that the motor vehicle operated by Manjit Kaur Sidhu and in which
the plaintiff Harpreet Kaur Sidu was a passenger, was struck by the defendants’
vehicle, and as a result the plaintiffs have suffered personal injuries, loss
of income and future loss of income, among other heads of claim. It is also
alleged that the defendant Harpreet’s education has been compromised, tuition
fees were thrown away and she has suffered a loss of opportunity to enter the
workplace.

[12]        
According to the plaintiffs, on May 11, 2010, the file was transferred at
ICBC to the Special Investigative Unit, which has a mandate to carry out
thorough investigations of all aspects of claims.

[13]        
The defendants have at all times admitted responsibility for the
accident since filing a response to civil claim in March of 2011.

[14]        
A trial of this action is scheduled to commence on October 23, 2013 in
New Westminster.

[15]        
The trial will also include a trial of an action commenced by the
plaintiff Manjit Kaur Sidhu and her husband relating to a motor vehicle
accident which occurred on December 17, 2008. As the claim of the husband of
Manjit Kaur Sidhu has been settled, only the claim of Manjit Kaur Sidhu arising
from the December 17, 2008 accident will be tried on October 21, at the same
time as the trial of this action.

[16]        
The defendants agree that the insurers for the defendants, ICBC,
received information regarding the identity of witnesses shortly after the
accident. The insurer states that as liability for the accident was admitted at
an early date, they did not follow up to obtain statements from those
witnesses.

[17]        
A mediation of this claim was scheduled for March 2, 2012. On February
27 and 28, the adjuster who was then in charge of the file for ICBC, Mr. Mike
Saito, finally spoke to the witness, Yaseen Chaudry. A statement was then given
to Mr. Saito by Mr. Chaudry on February 28, signed on March 1, 2012. The
complete statement reads as follows:

Statement from:          Witness Statement – Yaseen Chaudhry

This is the voluntary statement of Yaseen Chaudhry. My birth
date is, January 12, 1979. I am currently residing at 6860 – 126 Street in
Surrey, B.C.

I was residing at this same address back in July 2008 when I
witnessed an accident.

The accident happened around 9:30 p.m. at the intersection of
126^th Street and 68A Ave. My residence is on the north east corner
of this intersection. I was outside, standing on the front lawn when I saw a
car enter the intersection from a stop sign on the east side of the
intersection. The car collided with a black Jeep that was heading northbound on
126 Street. After the collision, the Jeep stopped in the intersection right in
front of my yard. I was looking right at the driver of the Jeep. The driver was
an East Indian male. He was darker skinned, and maybe in his late 20’s or 30’s.
He was not wearing a turban. There was no one in the front passenger seat. The
driver sat there for a moment, like he was frozen. After sitting still after
about five seconds he drove off, heading eastbound on 68A Ave. Another motorist
had stopped at the scene. He said that he was going to go look for the black
Jeep and told me to jump in his car. I sat in the back seat. I don’t know who
this driver was. By this time, the Jeep was out of sight. We drove around the
block and found it parked in a driveway on 70A Ave. We stopped for a moment,
but stayed in the car. The driver of the black Jeep was out of the house
talking to a couple of other people while they stood by the Jeep. We did not
talk to them. We went back to the accident scene and told the police where the
Jeep was.

Signed by “Yaseen Chaudhry”

[18]        
On March 1, 2012, the lawyer for the defendants advised that mediation
was being cancelled due to new information that had been obtained from a
witness stating that the driver of the Jeep was a male, not a female.

[19]        
On March 2, 2012, counsel for the defendants wrote to counsel for the
plaintiffs that an application would be brought to amend the response to civil
claim to reflect the information which ICBC and counsel for the defendants had
just obtained.

[20]        
A further statement was obtained from Mr. Chaudhry on November 6, 2012. It
included much the same information as the statement reproduced above, with some
further statements advising that the persons standing near the Jeep in the
driveway on 70A Avenue were East Indian and included “an older gentleman with a
turban and gray beard and an older lady, they were an elderly couple. Then from
what I remember a younger female”.

[21]        
The notice of application to withdraw the admissions and amend the
response to civil claim was not filed until February 8, 2013, and was heard by
the master on March 19, 2013. No explanation has been given to justify the
delay of almost one year between the time the new information was obtained and
the notice of application was filed.

[22]        
In his Reasons for Judgment dated May 29, 2013, the master referred to
the decision of Master Bouck in Hurn v. McLellan, 2011 BCSC 447, on the
law applicable to applications to withdraw admissions, and then continued:

[13]      In the present case, it cannot be said that the
admission was made inadvertently or hastily. The file had clearly been in the
hands of a professional adjuster since shortly after the accident. The adjuster
had requested and received a report from the RCMP within months of the
accident; that report included the names and contact information for various
witnesses including Mr. Chaudhry. The writ was not filed until some 14 months
after the adjuster obtained the police report and even then it was a further
nine months before a Response was filed admitting liability.

[14]      Even if the defendants did not have actual
knowledge of the evidence of Mr. Chaudhry when the admission was made, that
information was available to them and had been available to them for almost two
full years prior to the admission. Any ignorance of Mr. Chaudhry’s evidence
arose from the defendant’s decision not to seek out that evidence.

[15]      There is no way to determine whether the admission
is true or not. The evidence does indicate however that the plaintiffs have
proceeded on the basis of the admission of liability and have spent
considerable money addressing only the medical/quantum aspects of their
case. A withdrawal of liability at this late stage will of necessity result in
a complete reassessment of the case and may well result in an adjournment of
the trial.

[16]      Evidence which might have been available to impeach
the Chaudhry statement may well have been lost due to the passage of time.
Counsel agreed that the vehicle is no longer available for forensic examination
of the seatbelt mechanisms to determine how many showed signs of collision
stress or stretching.

[17]      I believe it to be significant that the fifth
circumstance which is listed to be taken into account according to the case of Hamilton
v. Ahmed (supra) is worded the way it is: “(e) the withdrawal of the
admission would not prejudice a party”.

[18]      I do not interpret that as requiring the plaintiffs
to affirmatively establish that they have suffered a specific prejudice; it
rather places the onus on the defendant to establish that there is no prejudice
to the plaintiffs. Far from presenting such evidence, counsel for the
defendants admitted in submissions that the plaintiffs would now be unable to
obtain any evidence as to the condition of the vehicle as the vehicle is no
longer available. Even if the vehicle was available for inspection and
examination today, five years of driving has intervened to make any current
findings useless.

[19]      Finally, it is clear that defence counsel was aware
of the Chaudhry statement in March of 2012, at which time they indicated their
intention to apply to withdraw the admission of liability; 11 months passed
before such application was filed. No explanation was provided for that
inordinate delay. On the face of the application there has clearly been delay
in bringing the application to withdraw the admission.

[20]      Master Bouck in the Hurn decision cited the
case of Sureus v. Leroux, 2010 BCSC 1344 in finding that:

… even if a trial date is not
imminent and the applicant gave early notice of the proposed withdrawal of the
admission, delay in bringing an application for such relief might in itself be
a concern that cannot be overcome.

[21]      In all of the circumstances of this case and for
the reasons noted above, I am of the view that this is not an appropriate case
to allow the withdrawal of the admission of liability. The application fails to
meet virtually all of the tests laid out in the Hamilton v. Ahmed,
[1999] B.C.J. No. 311 decision.

[22]      The application for
withdrawal of admission and for amendment of the Response is dismissed. The
plaintiffs will have their costs of the application in any event of the cause.

II.              
Discussion

A.             
The Standard of Review from a Decision of the Master

[23]        
The first issue to be dealt with is the standard of review to be
considered in an appeal from a decision of a master. The leading decision on
that issue is Abermin Corp. v. Granges Exploration Ltd. (1990), 45
B.C.L.R. (2d) 188 (S.C.). At p. 6 of Abermin, Mr. Justice Macdonald
said:

An appeal from a Master’s order
in a purely interlocutory matter should not be entertained unless the order was
clearly wrong. However, where the ruling of the Master raises questions which
are vital to the final issue in the case, or results in one of those final
orders which a Master is permitted to make, a rehearing is the appropriate form
of appeal. Unless an order for the production of fresh evidence is made, that
rehearing will proceed on the basis of the material which was before the
Master. In those latter situations, even where the exercise of discretion is
involved, the judge appealed to may quite properly substitute his own view for
that of the Master.”

[24]        
The Abermin decision was adopted as the general standard of
review of a master’s order in the decision of Mr. Justice Drossos in Nesbitt
v. Miramar Mining Corporation, 2000 BCSC 187. After quoting from Macdonald
J.’s decision in Abermin, Drossos J. stated:

[38]      The judicial admission
in the case at bar is significant in that it is essentially an admission of
liability by the defendant, subject to its claim that there was also a “kick
back” arrangement. Without this admission, the trial would be of a substantially
different nature: the primary issue would be different and the duration of the
trial prolonged. A finding on the issue in the defendant’s favour would be
determinative of the action in its entirety. Therefore, this matter is vital to
the final issue in the case, and can be reviewed by a judge of this court
without the necessity of the Master’s decision being clearly wrong.

B.             
Application of the Standard of Review to the Case at Bar

[25]        
In reviewing the decision of the master in the case at bar, his decision
to dismiss the application to withdraw the admission was primarily based upon the
defendants’ delay in bringing the application to withdraw the admission, and
prejudice to the plaintiffs caused by the delay in bringing the application due
to evidence that may not now be available to them.

[26]        
Although there was clearly delay on the part of the defendants’ insurer
and former counsel for the defendants, I do not necessarily agree that there
was any significant prejudice to the plaintiffs as a result. Counsel for the
plaintiffs submitted before the master that he would no longer have evidence as
to the condition of the vehicle as the vehicle was no longer available. The
condition of the vehicle, and the need to undertake a forensic study of the
same, is not necessary if the amendment were allowed. The issue here is not
damage to the vehicle, but whether the plaintiffs were actually in the vehicle
at the time of the accident or whether there was some other unknown male
driving the vehicle.

[27]        
Regarding the master’s comments on the inability to be able to
investigate the seatbelt mechanism, as the defendant driver  admitted liability
within a few days of the accident, I find it would have been highly unlikely
either party would have investigated the seat belts.

[28]        
Considering prejudice to the parties, if the amendment were allowed, the
plaintiffs would still be able to pursue their claims for injuries suffered in
the accident. The difference is that they would have to prove to the satisfaction
of the trial judge that they were in the vehicle at the time of the accident.

[29]        
As for prejudice to the defendants if the amendment is not allowed, the
trial would be merely an assessment of damages. Further, there could well be
prejudice to the court process if a person who was not even injured in the
accident were to collect on an assessment of damages. In effect, proceeding
without the amendment could permit a fraud on the court.

[30]        
As was the case in Nesbitt, without the admission in question,
“the trial would be of a substantially different nature” and “a finding on the
issue in the defendant’s favour would be determinative of the action in its
entirety”, to quote the words of Drossos J.

[31]        
As a result, it is appropriate for me to review the decision of the master
without the necessity of showing the Master’s decision to be clearly wrong.
Also, following the words of Macdonald, J. in Abermin, in these
circumstances it is open for me to substitute my view for that of the master.

C.             
The Legal Test for Withdrawing an Admission

[32]        
Both counsel have referred to the decision of Master Horn in Hamilton
v. Ahmed (1999), 28 C.P.C. (4^th) 139 (B.C.S.C.), for the test to
be applied for permitting an admission to be withdrawn. The master also
referred to Hamilton in his reasons for judgment at para. 12. The test outlined
by Master Horn in Hamilton is as follows:

[11]      There is no conflict between these decisions and I
derive the following principles from them:

1.     That the
test is whether there is a triable issue which, in the interests of justice,
should be determined on the merits and not disposed of by an admission of fact.

2.     That in
applying that test, all the circumstances should be taken into account
including the following:

3.     That the
admission has been made inadvertently, hastily, or without knowledge of the
facts.

4.     That the
fact admitted was not within the knowledge of the party making the admission.

5.     That the
fact admitted is not true.

6.     That the
fact admitted is one of mixed fact and law.

7.     That the
withdrawal of the admission would not prejudice a party.

8.    
That there has been no delay in applying to withdraw the admission.

[33]        
It is apparent from reading the above passage that the first item listed
by Master Horn is the test and that items 3 through 8 are factors to consider
in an application to withdraw an admission.

[34]        
In Goundar v. Nguyen, 2013 BCCA 251, Mr. Justice Harris dealt
with an appeal from a chambers judge who had permitted withdrawal of an
admission. Harris J.A. stated at para. 28:

Allowing the withdrawal of an admission
is a discretionary matter. Deference is owed to the chambers judge, unless the
judge erred in principle in the exercise of her discretion. Here I see no such
error. The judge found there to be a triable issue. She concluded that the
admission had been made inadvertently. She balanced any prejudice arising from
the proposed withdrawal of an admission. She addressed the extent to which a
prejudice could be compensated in costs. I would not interfere with the
exercise of the chambers judge’s discretion.

[35]        
In Piso v. Thompson, 2010 BCSC 1746, Master Caldwell dealt with
deemed admissions made by the plaintiff’s lawyer by virtue of having failed to
respond to a notice to admit. Master Caldwell stated:

[24]      The refusal of leave to withdraw these admissions
will deny the plaintiff his opportunity to have his claim head on the merits.
The argument that the plaintiff can have his relief by way of a professional
negligence claim against his former counsel fails to recognize the further
delay and expense of such a claim. In the context of proportionality such an
option does not seem appropriate from a financial or court resource
perspective.

[25]      In my view this is
precisely the type of situation which warrants an order allowing the withdrawal
of a deemed admission while providing for the other party in costs and other
accommodations.

[36]        
I have also considered the decision of Boyd v. Brai, 2000 BCSC 404,
in which Mr. Justice McEwan refused an application to withdraw an admission. In
that case, McEwan J. found the admission had not been made inadvertently or
without knowledge of the facts, and that the admission had resulted in the
plaintiff having not investigated other avenues in making her case, which would
have been available had the admission not been made.

D.             
The Defendants’ Application to Withdraw the Admission

[37]        
In this case, it is clear that there is a triable issue as to whether or
not the plaintiffs were in the Jeep at the time of the accident. If proven
against the plaintiffs, this issue would amount to the plaintiffs having
attempted to defraud the defendants. It is not in the interests of justice to
permit fraud on the court or on the defendants.

[38]        
I am satisfied that the admission was made inadvertently and without
knowledge of the evidence that a male person had been driving the plaintiff’s
vehicle and that there was no passenger in the front seat of the plaintiff’s
vehicle. It is very plausible that as the defendants admitted liability to
their insurer within two days of the accident, the insurer did not carry
through with further investigation and assumed the claim would likely be
limited to an assessment of damages.

[39]        
I do note that in the statement provided to ICBC by Baljit Kaur Hothi,
Ms. Hothi made reference to “the guy” who was driving the plaintiff’s vehicle.
The investigator taking Ms. Bothi’s statement apparently did not see any
significance to the use of the term, “the guy” or the defence would have been
alerted to a possible fraud if they were aware the plaintiffs were female. I
attribute this failure of the defence to a simple oversight or honest
misunderstanding.

[40]        
Although the defendants and their insurer had the ability to obtain the
evidence of a possible male driver, I find the fact that was admitted (that the
plaintiffs were driver and passenger in the Jeep), was not within the knowledge
of the defendants or their insurer. The insurer was provided with the names of
a witness or witnesses who could have provided the evidence now available, but
had no reason to follow up and investigate liability in and around the time
when the admission was made.

[41]        
Whether the fact admitted is true is a triable issue that will be at the
heart of this proceeding. Had the defendants and their insurer been aware of
this issue, I find it inescapable that the defence would not have admitted the
plaintiffs were in the Jeep.

[42]        
I find that whether or not the fact admitted is one of mixed law and
fact is irrelevant in this case.

[43]        
I also find there is no significant prejudice to the defendants in
allowing the admission. The witnesses to the accident are identified and, from
the evidence before me, are available. If the amendment is allowed and it is
determined by the trial judge that the plaintiffs were not in the Jeep, then
the plaintiffs would almost have gotten away with having committed a fraud on
the defendants. If the amendment were not to be allowed, then they would still
be able to pursue their claim for damages.

[44]        
Also, I have noted that the trial of this matter is now scheduled to
begin on October 23, 2013. The trial will not be significantly extended by
allowing the defendants to withdraw the admission and to amend the notice of
civil claim. There is also no reason to adjourn the trial as a result of
allowing the amendment. The witnesses required to testify on the identity issue
are known and their evidence could not be lengthy.

[45]        
The lone significant factor against granting the amendment is that there
has been a very significant delay in making the application to withdraw the
admission. The first part of the delay arose from the failure of the defendants
and their insurer to follow up and interview the three witnesses whose identity
had been provided by the RCMP. Defence’s response is that they had admitted
liability and had not appreciated the potential issue of the identity of the
driver and passenger in the Jeep. As stated previously in these reasons, the
failure of the defence to interview the witnesses at the earlier stages is
explainable since they had admitted liability for the accident.

[46]        
The defence and the insurer likely could have and should have acted
sooner to interview the witnesses, in particular Mr. Chaudhry, whose first
interview occurred in March of 2012. Also, the delay from the interview of Mr.
Chaudhry in March of 2012 until the notice of application was filed in February
of 2013 is inexcusable and is admitted by the defendants.

[47]        
In his reasons for judgment, the master included a quotation from Hurn
which has been repeated earlier in this judgment. In that quotation from Hurn,
Master Horn referred to the decision of Surerus v. Leroux, 2010 BCSC
1344, in which it was found that delay in bringing an application of this type
might be a “concern that cannot be overcome”. In this case, the delay can be
overcome and compensated in costs as ordered by Master Caldwell in Piso.

III.            
Disposition

[48]        
The appeal of the order of the master of May 29, 2013 is allowed. Costs
are awarded on Scale B to the plaintiffs in any event of the cause.

“Jenkins J.”