The importance of service of court documents should not be overlooked, as improper service may result in a party being noted in default, which invariably leads to adverse consequences for a litigant.
While service by e-mail has simplified and made the service of documents easier and more convenient in many respects, an originating process, for the most part (there are some exceptions set out in Rules 16.03(7)(8)(9)) still needs to be served personally or by a valid alternative to personal service.
The onus of proving proper service is on the party purporting to have effected service.[1] To dispute service, a defendant only needs to demonstrate that the claim was not properly served or provide evidence that contradicts the affidavit of service.[2] Once the defendant disputes service, the onus of proving proper service remains with the plaintiff.[3]
Rule 16.01(1) provides that an originating process shall be served personally as provided in Rule 16.02 or by an alternative to personal service as provided in rule 16.03. Rule 16.03 sets out various alternatives to personal service. For example, Rule 16.03(4) states that service of an originating process “may be made by sending a copy of the document together with an acknowledgment of receipt card (Form 16A) by mail to the last known address of the person to be served, but service by mail under this subrule is only effective as of the date the sender receives the card”. In Teskey v. Peraan, Master Macleod reiterated that proper service by mail under Rule 16.03(4) requires that the originating process be mailed with an acknowledgement of receipt card. In other words, service by mail is only effective if the “acknowledgment of receipt card or a post office receipt bearing a signature which ‘purports to be that of the person to be served’ is returned.”[4]
Moreover, proper service gives the court jurisdiction to note a defendant in default.[5] Validating a noting of default or default judgement founded on improper service undermines the administration of justice because “[i]f proper and effective service of originating documents ceases to be recognized as important, then chaos will result.”[6]
Further, a Registrar cannot issue a valid noting of default based on improper service.[7] If the plaintiff cannot prove that the originating process was properly served, the noting of default was irregularly obtained.[8] Accordingly, the noting of default has no effect and can be set aside as a matter of right.[9]
If the Court will not set aside the noting of default as of right and on the basis of ineffective service, the Court may exercise its discretion to grant the within motion under Rule 19.03(1), which states “[t]he noting of default may be set aside by the court on such terms as are just.”
Rule 19.03(1) affords the Court broad discretion to set aside a noting of default based on the contextual and factual situation.[10] The case of Franchetti v. Huggins provides a non-exhaustive list of factors the Court may consider when exercising its Rule 19.03(1) discretion. These factors include: (a) the behaviour of the parties; (b) the length of the defendant’s delay and the reasons for the delay; (c) the complexity and value of the claim; (d) the prejudicial effect on the parties and the balance of such effects; and (e) whether there is an arguable defence on the merits.[11]
It is clear that there are many factors at plan when it comes to effecting proper service and noting a party in default. As such, it is key to keep in mind the nuances of the rules of service before setting down the path to litigation.
[1] Ivan’s Films Inc. v. Kostelac, 1988 CarswellOnt 441, at paras. 6 and 8 [“Ivan’s Films”].
[2] Guillaume v. Toronto (City), 2010 ONSC 5045 (CanLII), at para. 33; Ivan’s Films at para. 6.
[3] Ivan’s Films at paras. 6 and 8.
[4] Teskey v. Peraan, 1999 CarswellOnt 1316 at para. 12.
[5] GRAF v. PERIYATHAMBY et al, 2018 ONSC 1757 (CanLII), at para. 24.
[6] Toronto Dominion Bank v. Machado, 1998 CarswellOnt 4659 (Ont. Master), at paras. 26 and 29 [“Machado”].
[7] Machado, at paras. 24 and 25.
[8] Royal Trust Corp. of Canada v. Dunn, 1991 CanLII 7227 (ON SC), at para. 19.
[9] Economical Mutual Insurance Co. v. Montgomery, 2013 ONSC 6153 (CanLII), at para. 66.
[10] Metropolitan Toronto Condominium Corporation No. 706 v. Bardmore Developments Ltd. (C.A.), 1991 CanLII 7095 (ON CA) at para. 18.
[11] Franchetti v. Huggins, 2022 ONCA 111 (CanLII), at para. 9.
