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Litigating Civil Disputes in Ontario During the COVID-19 Pandemic

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June 26, 2020

In response to the emergence of the COVID-19 pandemic, the Ontario Superior Court of Justice (the “Court”) suspended all regular operations on March 15, 2020. The suspension included the adjournment of hearings that were already scheduled and a moratorium on requests for new hearings, except for urgent ones.

Urgent hearings were permitted to continue out of recognition that access to justice must always remain available in order to permit the Court to continue to play its fundamental role in our constitutional democracy.

In the intervening three months, the Court has adapted to the challenges presented by the COVID-19 pandemic in various ways. The Court’s responses include the institution of procedures that enable hearings to take place either virtually/online or in writing.

As a result, it has remained possible to continue to litigate throughout the pandemic, although only in a limited fashion.

The procedures that remain available during the ongoing suspension of the Court’s regular activities vary depending on the region or city in which any given courthouse is located. A common feature remains the need to impress upon the Court the urgency of a matter if one or more of the parties to that matter wish/es to have it heard virtually/online. The Court has published guidelines that define which matters are sufficiently urgent as to warrant a hearing during the Court’s suspension of regular services.

In the context of civil, commercial disputes, urgent matters are generally limited to those that raise matters of public health and safety and those “where immediate and significant financial repercussions may result if there is no judicial hearing.”

The Courts have closely scrutinized claims for urgency to ensure that only those meeting that definition of “urgency” proceed to a virtual/online hearing.

A recent decision involving the Retire-At-Home franchise illustrates the difficulty litigants confront in attempting to schedule an urgent hearing during the COVID-19 pandemic. That case arose out of a royalty dispute between the franchisor and a number of its franchisees concerning the payment of royalties. The franchise system involves the provision of in-home care to seniors. The franchisor sought a specific form of court order known as an injunction requiring the franchisees temporarily (until such time as the dispute could be finally resolved at trial) to comply with their contractual obligations, including presumably the payment of royalties.

To obtain a temporary injunction like the one sought here, the party seeking it must normally persuade the court that there exists sufficient urgency as to warrant the Court’s imposition of terms on the other party until such time as a trial can be had – usually many months or several years in the future. Seeking an injunction during the COVID-19 is arguably even harder because, on top of proving urgency in the ordinary course whenever an injunction is sought, the party seeking it must – in order to be able just to make the request - now persuade the court that the matter concerns a public health and safety issue, or that immediate and significant financial repercussions may result if there is no judicial hearing. 

In the Retire-At-Home decision, the franchisor unsuccessfully tried to demonstrate both of those bases for urgency. It tried to argue that the franchisees’ continuing failure to pay royalties jeopardized the franchisor’s ability to continue operating, which in turn stood to imperil the provision of long-term health for seniors during the COVID-19 pandemic. The Court rejected that argument because, among other reasons, it was the franchisees who were providing that long-term health care to seniors, not the franchisor, and because at least some of them were seemingly able to do so without assistance from the franchisor. The franchisor also unsuccessfully argued that it stood to suffer immediate and significant financial repercussions should a hearing not be permitted to proceed in which the franchisor could request the injunction. The Court rejected that argument also, noting that the royalty dispute had been ongoing for several months prior to the emergence of the COVID-19 pandemic.

In the result, the Court directed the parties to seek the scheduling of any hearing, including the franchisor’s proposed hearing to request an injunction, once the Court’s suspension of services is lifted at least to the point of scheduling non-urgent hearings.

It remains possible, in several Ontario jurisdictions, to seek non-urgent relief in writing; there are numerous disputes that may be suitable for determination by way of written hearing. If you have a commercial dispute that you feel is urgent, you should consult as soon as possible with an experienced commercial litigator.