Motion to reopen trial after judgment

Mehedi v. 2057161 Ontario Inc., 2015 ONCA 670:

[13]       The test under rule 59.06(2)(a) to re-open a trial that applies after the judgment or other order has been issued and entered was set out by Doherty J.A., speaking for the court, in Tsaoussis (Litigation Guardian of) v. Baetz (1998), 41 O.R. (3d) 257, [1998] O.J. No. 3516, at paras. 41 and 44. As he noted, the onus is on the moving party to show that all the circumstances "justify making an exception to the fundamental rule that final judgments are exactly that, final." In particular, the moving party must show that the new evidence could not have been put forward by the exercise of reasonable diligence at the original proceedings. The court will go on to evaluate "other factors such as the cogency of the new evidence, any delay in moving to set aside the previous judgment, any difficulty in re-litigating the issues and any prejudice to other parties or persons who may have acted in reliance on the judgment."

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[15]       In my view, the appellant has met the test under rule 59.06(2)(a) as articulated in Baetz. It is plain that the proposed new evidence was not available at the time of the first trial or the first appeal. The appellant did not delay in seeking relief.  The new evidence is cogent, in that it is apparently credible and. if accepted, would probably have affected the result at trial; the new evidence could serve to undermine the evidence given by the respondents and bolster that of the appellant. That is because the video shows representatives of Job Success apparently making the same or similar promises to others that the trial judge found to be "unrealistic and unreasonable" with respect to the appellant. Finally, I see no prejudice to the respondents if the trial were re-opened.

[16]       Amicus submits that the motion judge erred in applying the test for re-opening a trial described by the Supreme Court of Canada in 671122 Ontario Ltd. v. Sagaz Industries Canada Inc., 2001 SCC 59, [2001] 2 S.C.R. 983. The Sagaz test was articulated in a case in which the judgment at issue had not yet been issued and entered. In the present case, while no formal judgment was taken out, the trial decision had been appealed. Amicus asserts that the motion judge ought to have applied the Baetz test, which includes the consideration of a number of different factors, including balancing fairness against the interest in finality.

[17]       In Sagaz, the Supreme Court accepted, at paras. 20 and 64, the motion judge's application of the two-part test for re-opening a trial described by the High Court in Scott v. Cook, [1970] 2 O.R. 769:

First, would the evidence, if presented at trial, probably have changed the result?  Second, could the evidence have been obtained before trial by the exercise of reasonable diligence?

[18]       Courts citing Sagaz often seem to boil the test down to these two questions (see, for example, 1057854 Ontario Inc. v. Kara Holdings Inc., [2005] O.J. No. 1144, at para. 40; Wesbell Networks Inc. (Receiver of) v. Bell Canada, 2013 ONSC 814; Irving Shipbuilding Inc. v. Schmidt, 2014 ONSC 5089, at para. 57; Madock v. Grauer, 2010 BCSC 1709). However, the Supreme Court, at para. 60, added this important direction: "Appellate courts should defer to the trial judge who is in the best position to decide whether, at the expense of finality, fairness dictates that the trial be reopened." Plainly then, fairness is also an important factor, including prejudice to others who have acted in reliance on the judgment, as Baetz notes.

[19]       I further note that in Sagaz, the Supreme Court, at para. 63, approved the following comments by Lord Denning in Ladd v. Marshall, [1954] 1 W.L.R. 1489 (C.A.), at p. 1491:

It is very rare that application is made to this court for a new trial on the ground that a witness has told a lie. The principles to be applied are the same as those always applied when fresh evidence is sought to be introduced. To justify the reception of fresh evidence or a new trial, three conditions must be fulfilled: first, it must be shown that the evidence could not have been obtained with reasonable diligence for use at the trial; secondly, the evidence must be such that, if given, it would probably have an important influence on the result of the case, though it need not be decisive; thirdly, the evidence must be such as is presumably to be believed, or in other words, it must be apparently credible, though it need not be incontrovertible. [Emphasis added.]

[20]       In my view, properly understood, the test in Sagaz goes beyond the two questions of whether the new evidence, if presented at trial, would probably have changed the result, and whether the evidence could have been obtained before trial by the exercise of reasonable diligence. It includes considerations of finality, the apparent cogency of the evidence, delay, fairness and prejudice, factors that were articulated by this court in its decision in Baetz. The error in this case was not in the motion judge's decision to apply Sagaz rather than Baetz, but in his application of the test, as I have already described. In this case, the new evidence meets both the Baetz and the Sagaz tests for re-opening a trial assuming there is any real distinction between the two.