Brian Campbell
March 1, 2002
Abuse of Process: Analysis and Update
In the following analysis of the doctrines of res judicata, issue estoppel, and cause of action
estoppel, it is asserted that different courts apply or discard these doctrines in an effort to reach a
conclusion which in the exercise of the Court’s inherent jurisdiction, prevents a denial of justice
or would tend to bring the administration of justice into disrepute. The vehicle is the overriding
doctrine of abuse of process which has mutated into the more recent principle of finality.
It is further asserted from a review of four cases which are the subject matter of this article, that
the primary consideration of the Courts was to analyze the estoppel doctrines and res judicata,
and when necessary or expedient, apply or not apply them depending on whether their
application gave rise to a failure of justice or some other perceived abuse, or not.
It is submitted that in the “post-modern era” the doctrine of abuse of process relieves the Courts
of the artificial constraints of the estoppel doctrines or res judicata, leading to decisions wherein
an issue that could have or should have been litigated in the first proceeding, may or may not be
allowed to proceed in a subsequent action. Where the application of the estoppel doctrines or res
judicata, if strictly applied, might preclude further litigation, the doctrine of abuse of process has
been utilized by the Court to permit an old issue to proceed to trial in a subsequent action.
Conversely, the doctrine of abuse of process may be equally applied by the Courts to prevent the
re-litigation of issues which were deemed resolved in the first proceeding, but do not fall within
the confines of the estoppel doctrines or res judicata.
As suggested, the emerging rationale for the application of the doctrine of abuse of process in the
cases discussed is that of finality to proceedings.
Therefore, it is concluded that the principle of finality is a more important consideration to the
Courts than the constraints imposed by the application of the estoppel doctrines or res judicata.
Even if none of the above doctrines are applicable, considerations of finality are utilized to apply
the logic of abuse of process to prevent an injustice.
To the extent that consideration of abuse of process may have been used to apply or reject the
other doctrines, it now appears that considerations of finality are preferred by the Courts to
render a final result where the other doctrines do not easily apply, or where their application
hinders a just result.
In the case of Canam v. Coles et al, [2000] 51 O.R. (3d) 481 (CA) the facts were as follows.
Financial Trust sold property to Canam who had retained realtors who misrepresented the
property as being zoned commercially. Canam purchased the property and gave back a
mortgage to National Trust. When Canam learned it couldn’t build a commercial building
because of the misrepresented zoning it sued National Trust on the take-back mortgage as being
void due to misrepresentation by the realtors regarding the zoning. The mortgage document was
upheld at trial so Canam thereafter sued its solicitor, who in turn sued the realtors, who in turn
sued National Trust.
2
All of these subsequent proceedings were dismissed by the Ontario Court of Appeal as being an
abuse of process even though the subsequent litigation involved different parties and issues. The
reason for the dismissal of the subsequent action was that the issue of the misrepresentation by
the realtor was central to the determination of the first law suit regarding the propriety of the
mortgage, and as such that issue could not be re-litigated.
Mr. Justice Finlayson, for the majority, determined that neither issue estoppel nor res judicata
applied as there were different parties in the subsequent litigation.
Although the Learned Justice referred to the doctrine of abuse of process, it would appear that
his analysis was more representative of the doctrine of cause of action estoppel. The realtors
could have properly been parties to the initial litigation but were not; since National Trust was a
party to the initial litigation they could not in subsequent litigation add the realtors as a fourth
party when such realtors could have been joined by National Trust in the initial proceedings.
Although Finlayson J. appears to adopt or rely upon the doctrine of abuse of process, and in the
end he was anxious to bring finality to the proceedings under the guise of abuse of process where
the application of doctrines of issue estoppel and res judicata were a hindrance to him, he
appears to have applied cause of action estoppel logic, couched it in terms of abuse of process. In
so doing however, he raised, as the pre-eminent rationale, the principle of finality.
At page 5, Finlayson J. states as follows:
[20] The key issue raised in this court is whether the appropriate parties were privy to the
proceedings between Canam and National Trust so that the doctrine of issue estoppel
applies to prevent the third party claim by Coles against the Realtors. I agree with the
result arrived at by the motions judge, (i.e. there was estoppel) but for different reasons.
[21] The issues of identity of subject matter and identity of parties had to be resolved by
the motions judge. The latter issue, also referred to as privity, is treated identically under
the doctrine of res judicata whether the claim is cause of action estoppel or issue estoppel.
Someone who is privy in interest to a party in an action is equally bound by the final
judgment in those proceedings. Thus, where a party to the prior proceeding is clearly and
sufficiently identified with a non-party to the litigation, the doctrine of res judicata may
be applied: Gleeson v. J. Wippell & Co. Ltd., [1977] 3 All E.R. 54 at p. 60, [1977] 1
W.L.R. 510 (Ch. D.).
At page 6, Finlayson J. goes on to say:
[26] The issue before the motions judge and this court became whether Coles was
estopped, or barred by the doctrine of abuse of process, from raising as between Canam
and the Realtors the issue of whether Canam was relieved of liability under the mortgage
to National Trust because Canam relied on the zoning representations conveyed to it
through National Trust's agents, the Realtors. If my assessment of the situation is correct,
the issue is not whether Coles was a privy of Canam, but whether the Realtors were
privies of National Trust. Instead of looking at the relationship between the solicitor Cole
and his client, the plaintiff, Canam, we should look to the relationship between the third
party Realtors and the defendant in the mortgage action, National Trust. The Realtors
should take the position that Canam could have sued them in the Mortgage Action as
agents of National Trust for the same misrepresentations that it alleged against National
Trust and did not do so. Since the mortgage action involving these allegations of
3
misrepresentation was resolved adversely to Canam, it follows that the issue of the
validity of the real estate transaction is res judicata between Canam and National Trust,
and issue estoppel applies as between Canam and the Realtors as privies to National
Trust. [emphasis added]
It is submitted that, having found that the issue in the subsequent action should have or could
have been determined in the initial action, Finlayson J. does not apply the doctrine of cause of
action estoppel as he could have. Rather, he provides an abuse of process analysis. At page 7,
Finlayson J. states as follows:
Abuse of process
[31] However, we are not limited in this case to the application of issue estoppel. The
court can still utilize the broader doctrine of abuse of process. Abuse of process is a
discretionary principle that is not limited by any set number of categories. It is an
intangible principle that is used to bar proceedings that are inconsistent with the
objectives of public policy. The doctrine can be relied upon by persons who were not
parties to the previous litigation but who claim that if they were going to be sued they
should have been sued in the previous litigation. This was the case in M.C.C. Proceeds
Inc. v. Lehman Brothers International (Europe), [1998] 4 All E.R. 675 (C.A.), where the
second claim was against a wholly owned subsidiary of the defendant in the first claim.
Similarly, in Solomon v. Smith (1987), [1988] 1 W.W.R. 410 at pp. 419-20, 45 D.L.R.
(4th) 266 (Man. C.A.), the purchaser unsuccessfully sued the vendor and was seeking to
sue the vendor's agent. The court found that allowing the second action to proceed would
amount to an abuse of process. [emphasis added]
...
[33] Unless there is new evidence, special circumstances or equitable reasons, then
Coles should not be entitled to raise a second cause of action, identical in merit, against
an agent who was a privy to the initial proceeding. The Realtors could have been properly
included in the initial proceeding. There could be any number of reasons why Canam did
not do so, but it hardly lies in the mouth of a stranger to those proceedings to insist
constructively that there now be a trial as to the liability of the Realtors to Canam.
[emphasis added]
[34] Maintaining open and ready access to the courts by all legitimate suitors is
fundamental to our system of justice. However, to achieve this worthy purpose, the courts
must be vigilant to ensure that our system does not become clogged with unnecessary,
repetitious litigation. To allow the defendant to retry the issue of misrepresentation would
be a classic example of abuse of process and a waste of the time and resources of the
litigants and the court. The retrying of the issues in this case would also erode the
principle of finality that is crucial to the proper administration of justice. Thus, where
agents as third parties must raise a defence to issues that are identical to those in a prior
proceeding against their principal, the court is entitled to exercise its discretion and
terminate the third party proceedings (and in this case the fourth party) as an abuse of
process. [emphasis added]
Therefore, although the analysis confuses or merges abuse of process with cause of action
estoppel language, the overriding consideration as set out in paragraph 34 was the principle of
finality, and that consideration prevailed.
4
Conversely, in the Nova Scotia Court of Appeal case of Hoque v. Montreal Trust, [1997] N.S.J.
No. 430, Cromwell, J. tackled the thorny question of what issues had been determined in the
prior proceeding, and ruled, for the most part, that the subsequent proceeding was a re-litigation
of the prior proceeding.
Cromwell, J. in Hoque case, although commenting in passing on abuse of process, concentrated
on the doctrine of cause of action estoppel and determined that it applied, and because its object
was finality, then, for the most part, the Plaintiff, Hoque in a subsequent proceeding could not relitigate a previous claim.
Cromwell J.’s analysis of cause of action estoppel leads me to believe that the current tendency
of Courts to utilize the doctrine of abuse of process is an outgrowth or expansion of the old
doctrine of cause of action estoppel, and restores the rationale of the older doctrine to its rightful
place of prominence ahead of issue estoppel or even res judicata, both of which depend so
heavily on the similarity or privity of parties.
Neither the old doctrine of cause of action estoppel, first expressed in the 1843 case of
Henderson v. Henderson, nor the modern day abuse of process doctrine, are constrained by
similarities of parties in prior and subsequent proceedings; rather these doctrines look to what
properly could have or should have been considered previously, and determine that in the
interests of finality such matters cannot be re-litigated.
In the Hoque case the facts were as follows. Mr. Hoque and various companies through which
he operated entered into several mortgage transactions with Montreal Trust. Hoque subsequently
experienced financial difficulties. A subsequent amending agreement was entered into whereby
the outstanding arrears were capitalized, the interest rate was reduced, and various modifications
to the payment schedules were made. Hoque defaulted. Montreal Trust then brought an action
to enforce its remedies under the agreement, including foreclosure actions on the various
mortgages. Hoque made a voluntary assignment into bankruptcy. The foreclosure judgments
were obtained on default since the trustee did not defend the actions. Hoque then obtained leave
to bring his own subsequent action. Hoque, inter alia, alleged that Montreal Trust and its
employee acted in a malicious manner designed to destroy the plaintiff’s businesses, that the refinancing arrangements were unconscionable, and that it acted in a manner which intentionally
interfered with his economic and business relations. ... The issue was what allegations in the
subsequent action ought to have been raised by way of defence to the previous foreclosure
action.
At page 7, the Court, on appeal, articulated the issue as follows.
IV. Issue:
18 There is one fundamental issue on this appeal: whether the Chambers judge erred in
law in refusing to dismiss Dr. Hoque’s action as res judicata.
V. Analysis:
19 This appeal involves the interplay between two fundamental legal principles: first,
that the courts should be reluctant to deprive a litigant of the opportunity to have his or
her case adjudicated on the merits; and, second, that a party should not, to use the
language of some of the older authorities, be twice vexed for the same cause. Distilled to
its simplest form, the issue in this appeal is how these two important principles should be
5
applied to the particular facts of this case.
21
Res judicata is mainly concerned with two principles. First, there is a principle
that “...prevents the contradiction of that which was determined in the previous litigation,
by prohibiting the re-litigation of issues already actually addressed.” : see Sopinka,
Lederman and Bryant, The Law of Evidence in Canada (1991) at p. 997. The second
principle is that parties must bring forward all of the claims and defences with respect to
the cause of action at issue in the first proceeding and that, if they fail to do so, they will
be barred from asserting them in a subsequent action. This “...prevents fragmentation of
litigation by prohibiting the litigation of matters that were never actually addressed in the
previous litigation, but which properly belonged to it.”: ibid at 998. Cause of action
estoppel is usually concerned with the application of this second principle because its
operation bars all of the issues properly belonging to the earlier litigation.
24
There are some very wide statements about the scope of cause of action estoppel.
For example, in the seminal case of Henderson v. Henderson (1843 - 60) All E.R. 373,
Vice-Chancellor Wigram stated that the plea of res judicata ... “applies...not only to
points upon which the Court was actually required by the parties to form an opinion and
pronounce a judgment, but to every point which properly belonged to the subject
litigation and which the parties exercising reasonable diligence might have brought
forward at that time.” (at 381-2), (emphasis added). Similarly in Fenerty v. Halifax
(1920), 50 D.L.R. 435 (N.S.S.C. en banco) Ritchie, J. for the Court said that the plea
applies “...not only as to the matter dealt with, but also as to questions which the parties
had an opportunity of raising.” (At 437), (emphasis added) There are several similarly
broad statements in 420093 B.C. Ltd. v. Bank of Montreal (1995), 128 D.L.R. (4th) 488
(Alta C.A.) especially at 499-502.
25
The appellants submit, relying on these and similar statements, that cause of
action estoppel is broad in scope and inflexible in application. With respect, I think this
overstates the true position. In my view, this very broad language which suggests an
inflexible application of cause of action estoppel to all matters that “could” have been
raised does not fully reflect the present law.
Cromwell, J. provides an exhaustive analysis of cause of action estoppel and in the process
determines as a matter of Canadian law, that whereas cause of action estoppel may have been
applicable to cases where an issue could have been brought in prior proceedings, in Canada its
application is circumscribed by the question of whether the action or issue should have been
raised in the prior proceeding. Mr. Justice Cromwell states that the test of whether the issue
could have been raised in the prior proceeding is too wide a proposition to be applied in the
application of the doctrine of the cause of action estoppel.
Cromwell J. states as follows at page 10 of the aforesaid case:
Although many of these authorities cite with approval of the broad language of
Henderson v. Henderson, supra, to the effect that any matter which the parties had the
opportunity to raise will be barred, (i.e.could have) I think, however, that this language is
somewhat too wide. The better principle is that those issues which the parties had the
opportunity to raise and, in all of the circumstances, should have raised, will be barred.
6
In determining whether the matter should have been raised, a court will consider whether
the proceeding constitutes a collateral attack on the earlier findings, whether it simply
asserts a new legal conception of facts previously litigated, whether it relies on “new”
evidence that could have been discovered in the earlier proceeding with reasonable
diligence, whether the two proceedings relate to separate and distinct causes of action and
whether, in all of the circumstances, the second proceeding constitutes an abuse of
process. (parentheses added)
At paragraph 68-69, his Lordship continues as follows:
At the core of cause of action estoppel is the notion that final judgments are conclusive as
to all of the essential findings necessary to support them. This is seen in the cases
concerned with collateral attack, supra, and is reflected in the restricted approach to res
judicata found on default judgments.
In my respectful view, Dr. Hoque cannot be permitted to allege in this action anything
which is inconsistent with the final orders of foreclosure in the previous action. In other
words, all the matters essential to the granting of the final orders of foreclosure are not
now open to be re-litigated in these proceedings. This is not a mere technical rule but an
application of a fundamental principle of justice; once a matter has been finally decided,
it is not open to reconsideration other than by appeal or other proceeding challenging the
initial finding.
Cromwell J therefore makes a strong argument for the application of his version of cause of
action estoppel, but, in my view, he ultimately relied on the principle of finality to justify his
conclusion. At page 15, Cromwell J. states as follows:
68
At the core of cause of action estoppel is the notion that final judgments are
conclusive as to all of the essential findings necessary to support them. This is seen in
the cases concerned with collateral attack, supra, and is reflected in the restrictive
approach to res judicata founded on default judgments.
69 In my respectful view, Dr. Hoque cannot be permitted to allege in this action
anything which is inconsistent with the final orders of foreclosure. In other words, all of
the matters essential to the granting of the final orders of foreclosure are not now open to
be relitigated in these proceedings. This is not a mere technical rule but an application of
a fundamental principle of justice: once a matter has been finally decided, it is not open
to reconsideration other than by appeal or other proceedings challenging the initial
finding.
70 Dr. Hoque's action makes several claims that are inconsistent with the findings
essential to the validity of the foreclosure orders.
71 Dr. Hoque alleges in his statement of claim (paragraph 18) that the refinancing
arrangements in the amending agreement were unconscionable. However, the amending
agreement was specifically pleaded in the foreclosure actions and the final orders of
foreclosure were predicated on its validity and enforceability. Therefore, the allegation
of unconscionability in Dr. Hoque's action is inconsistent with the final orders of
foreclosure.
7
72 Dr. Hoque alleges that there were collateral agreements, in essence waiving or
delaying Montreal Trust's right to the $150,000 payments provided for in the amending
agreement. In addition, there are alleged to be collateral agreements relating to the partial
discharge provisions in the amending agreement to the effect that something less than the
presale of 50% of the units would be sufficient (paragraphs 22-25). These allegations are
inconsistent with the enforceability of the amending agreement. However, its
enforceability is an essential basis of the final orders of foreclosure.
73 Dr. Hoque's statement of claim further alleges that the course of dealing by
Montreal Trust in entering into the amending agreement and enforcing it according to its
terms was "a course of action designed to destroy Dr. Hoque", and was conduct designed
to "intentionally and tortiously interfere with [his] economic and business relations".
Once again, these allegations go to the root of the legality and enforceability of the
amending agreement and the mortgages.
74 Although the pleading is not specific with respect to the acts of trespass and
conversion relied on, it appears that these allegations relate to the exercise by Montreal
Trust of its remedies as mortgagee and under related agreements. They are, therefore,
inconsistent with the validity and enforceability of the mortgages and the amending
agreement.
75 I conclude, therefore, that Dr. Hoque is precluded from asserting any of these claims
in this action and that the learned Chambers judge erred in law in failing to strike them
out.
76 I would not go so far as to hold that the application of res judicata in a case like this
one is completely inflexible. There may be, to use the words of Vice-Chancellor
Wigram, special circumstances in which some flexibility may be required to prevent a
serious injustice. To the extent that the learned Chambers judge relied on this flexibility
in this case, I think, with great respect, that he erred in principle by failing to give
sufficient weight to two considerations which, in this case, are of fundamental and
overriding importance.
77 There is the strong policy in favour of the finality of court orders. As set out above,
this is important not only for the certainty of transactions between the parties, but to the
integrity of the judicial process. This consideration is fundamental to the administration
of justice and I think, with respect, that it was not given sufficient weight by the
Chambers judge.
Notwithstanding Cromwell J.’s analysis of the distinction between could have versus should
have as a determination of the application of the cause of action estoppel, such a distinction
seems mere semantics in the face of the case of Johnson v. Gore Wood et al (December 14,
2000) House of Lords, a case wherein Lord Bingham of Cornhill (at paragraph 22) quoted Lord
Kelbranton from the Yat Tung case in his discussion of res judicata and cause of action estoppel
as follows.
...But there is a wider sense in which the doctrine may be appealed to, so that it becomes
an abuse of process to raise in subsequent proceedings matters which could have, and
therefore should have been litigated in earlier proceedings. (emphasis added)
8
Be that as it may, in both cases it was the principle of finality that held sway.
In the Johnson case, the application of abuse of process appears to have been carried too far in
circumstances where Johnson (WWH) asked his lawyers, GW, to act in the purchase of land on
an option. GW, on behalf of Johnson, sued for specific performance when the vender refused to
honour the option. Specific performance was granted but an assessment for damages was not
vigorously pursued. Eventually, WWH sued its solicitors, GW, for not moving along the
specific performance or assessment of damages proceeding. Subsequently there was a settlement
of that action, and in Johnson, the principle, Mr. Johnson, the alter ego of WWH, sued GW on
the basis he suffered damages independent of or instead of his company, WWH. The Court
found that although most of the same questions as to liability and damages were at issue in the
second action as were dealt with during the initial action, the suit of Johnson could proceed! The
Court of Appeal said the subsequent proceeding was abusive as Mr. Johnson could have, and
therefore should have, pursued his own action before the conclusion of his company’s settlement
proceedings. However, Lord Bingham (House of Lords) stated at paragraph 20 of the Johnson
action as follows:
GW contends that Mr. Johnson has abused the process of the court by bringing an action
against it in his own name and for his own benefit when such an action could and should
have been brought, if at all, as part of or at the same time as the action brought against the
firm by WWH. The allegations of negligence and breach of duty made against the firm
by WWH in that action were, it is argued, essentially those upon which Mr. Johnson now
relies. The oral documentary evidence relating to each action is substantially the same.
To litigate these matters in separate actions on different occasions, is GW contends, to
duplicate the cost and use of the court time involved, to prolong the time before the
matter is finally resolved, to subject GW to avoidable harassment and to mount a
collateral attack on the outcome of the earlier action, settled by GW on the basis that
liability was not admitted.
At paragraph 21 of the case, Lord Bingham refers to Sir James Wingram’s quotation in the
Henderson v. Henderson case, at page 114 as follows:
In trying this question, I believe I state the rule of the court correctly when I say that,
where a given matter becomes a subject of litigation in, and of adjudication by, a court of
competent jurisdiction, the court requires the parties to that litigation to bring forward
their whole case and will not (except under special circumstances) permit the same
parties to open the same subject of litigation in respect of matter which might have been
brought forward as part of the subject in contest, but which was not brought forward,
only because they have, from negligence, inadvertence, or even accident, omitted part of
their case. The plea of res judicata applies, except in special cases, not only to points
upon which the court was actually required by the parties to form an opinion or
pronounce a judgment, but to every point which properly belonged to the subject of
litigation, and which the parties, exercising reasonable diligence, might have brought
forward at the time.
In the same paragraph, Lord Bingham refers to Somervell, L.J. in Greenhalgh v. Mallard, [1947]
2 All E.R. 255 at 257, as follows regarding estoppel:
...issues or facts which are so clearly part of the subject matter of the litigation and so
clearly could have been raised that it would be an abuse of the process of the court to
9
allow a new proceeding to be started in respect of them.
At paragraph 30, Lord Bingham refers to Manson v. Vooght et al, [1999] BPIR 376, at 387 as
follows:
In my view, the issue in this context of the phrase ‘res judicata’ is perhaps unhelpful, and
this not only because it is Latin. We are not concerned with cases where a court has
decided the matter; but rather cases where the court has not decided the matter, but where
in a (usually late) succeeding action someone wants to bring a claim which should have
been brought, if at all, in earlier concluded proceedings. If in all the circumstances the
bringing of the claim in the succeeding action is an abuse, the court will strike it out
unless there are special circumstances. To find that there are special circumstances may,
for practical purposes, be the same thing as deciding that there is no abuse ... in cases
such as the present, the abuse is sufficiently defined in Henderson which itself is
encapsulated in the proposition that the litigant could and should have raised the matter in
question in earlier concluded proceedings. Special circumstances may negate or excuse
what would otherwise be an abuse. But there may in particular cases be elements of
abuse additional to the mere fact that the matter could and should have been raised in
earlier proceedings.
In paragraph 31, Lord Bingham refers to the case of Bradford and Bingley Building Society v.
Seddon, [1999] 1 W.L.R. 1482, at 1490 as follows:
In my judgment, it is important to distinguish clearly between res judicata and abuse of
process not qualifying as res judicata, a distinction delayed by the blurring of the two in
the court is subsequent application of the above dictum (...in Henderson v. Henderson).
The former, in its cause of action estoppel form, is an absolute bar to relitigation, and in
its issue estoppel form also, save in ‘special cases’ or ‘special circumstances’... The
latter, which may arise where there is no cause of action or issue estoppel, is not subject
to the same test, the task of the court being to draw the balance between the competing
claims of one party to put his case before the court and of the other not to be unjustly
hounded given the earlier history of the matter...
Thus, abuse of process may arise where there has been no earlier decision capable of
amounting to res judicata (either or both because the parties or the issues are different)
for example, where liability between new parties and/or the determination of new issues
should have been resolved in the earlier proceedings.
... In my judgment mere re-litigation, in circumstances not giving rise to a cause of action
or issue estoppel, does not necessarily give rise to abuse of process.
Some additional element is required such as collateral attack upon a previous decision...
dishonesty...or successive actions amounting to unjust harassment.
It is asserted that Lord Bingham appears to have excused Johnson not pursuing his own claim
until settlement of his company’s claim because it would be unfair to deny Mr. Johnson in his
personal capacity, his day in court. Thus, in my respectful view, there was no finality and no
protection from re-litigation or litigation harassment on the part of GW.
10
Lord Bingham found reasons in the fact situation to create special circumstances to overcome the
prohibitions found in the doctrines of the cause of action estoppel or abuse of process. This
decision seems to have penalized GW because Johnson decided to wait and settle his company’s
action before proceeding with his own action against GW.
It appears to me, with the greatest of respect, that the Court got lost in the morass of case-law
analysis that deals with the estoppel doctrines, and lost sight of the fact that the principle of
finality should have prevailed, to prevent Johnson from pursuing an action on the grounds that
his company’s previous action had been settled, and therefore the issues in the second action had
been previously considered.
Neither Finlayson’s analysis in the Canam case, nor Cromwell J.’s analysis in the Hoque case
were, while relying on abuse of process and cause of action estoppel respectively to prevent
further litigation, adopted by Lord Bingham because, respectfully, he lost sight of the overriding
principle in both of these doctrines of the need for finality. His analysis was strained to the
extreme in an effort to find special circumstances sufficient for Mr. Johnson to re-litigate what
had already been decided regarding his company.
In the case of City of Toronto v. CUPE (August 10, 2001) it is submitted that Doherty, J.A., had
he been deciding the Johnson case, would have come to the opposite conclusion by virtue of his
application of the principle of finality, because this principle is the cornerstone for the
application of abuse of process, or cause of action estoppel.
Without reviewing the complex facts and the reasoning of the CUPE case, Justice Doherty’s
conclusions in applying abuse of process to overturn re-litigation of a criminal conviction in
collateral proceedings is instructive.
Mr. Justice Doherty states as follows at paragraphs 78-81:
The finality principle and the values underlying that principle are well understood and
have been stressed in various contexts by this court... Those values warrant reiteration...
Finality is essential to the maintenance of a fair and effective adjudicative process. The
values it serves are fundamental to that process and to the community. Firstly, relitigation raises the spectre of inconsistent results...
Secondly, re-litigation diminishes the overall authority of the adjudicative process...
Thirdly, re-litigation breeds uncertainty... Finally, re-litigation drains individual and
institutional resources. ...
The simple truth is that finality is so essential that it is routinely given priority over the
possibility that re-litigation would achieve a more accurate result. The importance of
finality is best seen in those cases where finality has trumped individual constitutional
rights. ... In those cases, even though the decision is wrong in the most important sense
in that it denies someone a fundamental right, the courts have held that finality precludes
re-litigation. A desire to avoid the harm caused by permitting re-litigation is given
paramountcy over the rights of the individual and the accuracy of the result in the
particular case.
11
Again, at paragraph 99 of the aforesaid CUPE case, Mr. Justice Doherty states as follows:
Those cases which have refused to apply res judicata to preclude re-litigation even
though the criteria for the application of the doctrine were met, and those cases which
have refused to permit re-litigation even though all of the res judicata doctrine were not
met, reflect the same principled approach to the problem of re-litigating decided issues.
The ultimate question must be whether finality concerns preclude re-litigation or whether
the justice of the individual case demands re-litigation.
The following approach should be taken when weighing finality claims against an
individual litigant’s claim to access to justice:
– Does the res judicata doctrine apply?
– If the doctrine applies, can the party against whom it applies demonstrate that
the justice of the individual case should trump finality concerns?
– If the doctrine does not apply, can the party seeking to preclude relitigation
demonstrate that finality concerns should be given paramountcy over the claim
that justice require re-litigation?
In the last analysis in this case, where an employee of the City of Toronto had been a victim of
sexual misconduct criminally, and fired for that misconduct, Doherty J.A. concluded that there
could be no re-hearing by an assessment officer with respect to the criminal conviction stating as
follows at paragraph 102:
Even though issue estoppel does not apply I am convinced that in these circumstances,
finality concerns must be given paramountcy over CUPE’s claim to an entitlement to relitigate Oliver’s culpability.
It is my view that the doctrine of abuse of process, which appears to be an extension or an
elaboration of the old doctrine of cause of action estoppel in Henderson v. Henderson, has now
extended its own logic to considerations involving the principle of finality within the context of
the proper administration of justice. Whether the Court characterizes the problem it faces as an
abuse of process or as cause of action estoppel, the Courts today, in my view, are more inclined
to bring an end to the litigation than in the past. Whether the matter could have or should have
been decided previously, or whether there are special circumstances that would lead to it being
re-litigated such special circumstances must be substantial for re-litigation to be occur.
In my view, in Johnson, the special circumstances were insufficient. I believe Doherty J.
undoubtedly would have prevented the subsequent proceedings. It would appear that the
“special circumstances criteria” are becoming, and should become, more difficult to establish in
an effort to prevent abuses of process which occur when previous issues could have or should
have or were dealt with on a prior occasion.
A recent case, in which I was sued along with a number of other defendants, usefully
summarizes the position Ontario courts appear to take regarding abuse of process. In this case,
Shuman brought a claim against ONHWP for warranty deficiencies and ONHWP denied the
12
claim. It was appealed to the Licence Appeal Tribunal and Shuman lost. He subsequently
appealed to the Divisional Court, Court of Appeal and Supreme Court of Canada and lost. He
then sued ONHWP, LAT, all of his lawyers and all of ONHWP’s lawyers! On motions for
summary judgment, Swinton J. discussed the subsequent action, inter alia, under the heading of
abuse of process. In a decision released October 23, 2001, Swinton J. (unreported) states as
follows.
[9]
A Notice of Action was issued February 19, 1999, followed by a Fresh as
Amended Statement of Claim dated September 19, 2000. There, the plaintiff claims
compensatory and punitive damages of $98 million for fraud, breach of contract,
negligence, breach of fiduciary duty and statutory duty, misrepresentation and abuse of
process against a large number of defendants. There is no mention of the torts of
misfeasance in public office or spoliation of evidence, but both those causes of action
were relied upon in the factum filed for these motions, as well as in oral arguments on
behalf of Dr. Shuman.
[10] A careful reading of the Fresh as Amended Statement of Claim in this action, and
the affidavit of September 17, 2001, filed by Dr. Shuman in responding to this motion,
shows that the foundation of his claim is the allegation that he had a meritorious claim for
compensation from the ONHWP, which was defeated by the misconduct of the various
defendants.
...
[13] Many of the allegations in the Statement of Claim relate to the proceedings before
the tribunal and the actions of the ONHWP counsel before the tribunal. For example, Dr.
Shuman complains that Morley Thurston was not called as a witness by Mr. Campbell, as
promised. Instead, Allan Stevenson, another Warranty Representative, was called. It is
alleged that Mr. Stevenson misled the tribunal, and his evidence was determinative on the
builder/owner issue. However, counsel who appeared for Dr. Shuman before the tribunal
did not object to the calling of Mr. Stevenson, nor is there any evidence that an effort was
made to call Mr. Thurston. As well, these matters were raised in the material before the
Divisional Court, without effecting the decision on the appeal.
...
[15] Pursuant to Rule 21.01(3)(d), a defendant may move to have an action stayed or
dismissed if it is frivolous or vexatious or otherwise an abuse of the process of the court.
[16] This rule has been invoked successfully when a party attempts to re-litigate issues
that have been judicially determined. The doctrines of both res judicata and issue
estoppel operate to prevent the re-litigation of issues which have been decided in earlier
judicial proceedings. However, even when these doctrines do not strictly apply, the
courts have held that they can dismiss an action as an abuse of the process of the court
when a litigant seeks to re-litigate issues that have finally been determined in prior
judicial proceedings. In Demeter v. British Pacific Life Insurance Co. (1984), 48 O.R.
(2d) 266, for example, the Court of Appeal held that the plaintiff could not use a civil
action to initiate a collateral attack on a final decision of a criminal court of competent
jurisdiction, and the effort to do so amounted to an abuse of the process of the court (at
268). A similar approach was taken by the Manitoba Court of Appeal in Solomon v.
Smith (1987), 22 C.P.C. (2d) 12 in a case where the plaintiff sought to re-litigate issues
determined against other parties in an earlier case in Alberta (at 19).
13
[17] The complaints and allegations of misconduct which Dr. Shuman has raised in
this new action are all complaints which he raised or could have raised before the tribunal
and in the appeal proceedings. For example, his complaints that the decision of CRAT
were not supported by the law have been determined by the decision of the Divisional
Court, and the authorities which he wished the Court to rely upon were before it.
Moreover, his complaints about missing evidence, misleading evidence given by the
defendant Stevenson, and appropriate legal authorities were before the Divisional Court,
as is clear if one compares his affidavit for this motion with the affidavits dated February
20, 1996 and April 29, 1988, which were before the Divisional Court. For example, in
the 1996 affidavit, he complained of the lack of the full record for the appeal, and
claimed that CRAT was biased against him. In the 1998 affidavit, he complained of the
missing tape, the failure to call Thurston as a witness, the fact that Stevenson gave
misleading evidence, the fact that the Program decision was inconsistent with preexisting policy, and the failure to cite certain legal authorities. These same complaints are
made again in the affidavit for this motion dated September 17, 2001.
[18] Given that all appeal proceedings with respect to his claim for compensation have
been exhausted, he can not now attempt to re-litigate the same complaints in a new
action. To do so would be an abuse of the process of this court.
[19] Even if Dr. Shuman has framed his claims in the Statement of Claim in this action
in conspiracy, negligence, breach of fiduciary duty, it is clear that his complaints are the
same as they were in the earlier proceeding. The addition of new parties or different
assertions of liability do not change the fact that he is attempting to re-litigate an issue
that has been finally decided against him.
What Swinton J. concluded here was that finality was required and that Shuman could not be
permitted to sue a host of collateral defendants in subsequent proceedings in circumstances
where the matter was addressed in prior proceedings whether at the Tribunal stage or on appeal.
Indeed, in this case, arguments made on appeal, disposed of by the Divisional Court and the
Court of Appeal, were deemed to be included in the initial hearing or as having been raised at
some point during the course of the prior proceeding. Swinton J. states at page 7 of the decision
(unreported).
Therefore, by way of conclusion, the principle of finality, in my view, appears to be the
overriding principle adopted by the modern courts to apply the doctrine of abuse of process to
bring an end to litigation if the doctrines of estoppel or res judicata do not apply, so as not to
bring the administration of justice to disrepute.
©
Brian M. Campbell
March 2002