A former financial advisor in Ontario has won the right to amend his 2017 lawsuit against Credential Securities Inc., allowing him to pursue his case under Simplified Procedure. The ruling permits him to seek damages up to $200,000, reduced from his initial claim of $500,000.
A.R.’s legal battle began after his termination from First Ontario Credit Union, where Credential had provided investment dealer services and accused him of misconduct during his training period. Credential’s refusal to license A.R., allegedly based on plagiarism and other contractual breaches, led to his dismissal.
The original claim included accusations of negligence, breach of fiduciary duty, and wrongful interference, seeking half a million dollars in damages.
The Ontario Superior Court of Justice’s decision to allow a Simplified Procedure came after A.R. argued that the high costs of a conventional long trial were unaffordable for him, asserting that “he cannot afford a long trial” and is prepared to “waive his entitlement to damages in excess of $200,000” to proceed under this alternative.
“(A.R.) states that his income for 2022 was approximately $60,000, and his 2021 notice of assessment listed income of $23,897,” the court said.
A.R. contended that Credential was not litigating in good faith and accused the firm of defending through attrition rather than on the merits.
However, Credential opposed the amendment, arguing there had been no significant change in circumstances to justify it, and claimed that moving to a Simplified Procedure would limit their ability to mount a full defense. It pointed out that it had been represented by senior counsel throughout the proceeding, and showed a bill of costs of $125,560.60 for fees on a 90 per cent substantial indemnity basis, disbursements and HST.
Credential said that, had the action been transferred to a Simplified Procedure at an earlier point in time, then “primary carriage of the defence would have been undertaken by a junior lawyer with oversight from senior counsel,” the court said.
Despite their objections, the court sided with A.R., stating that “if a plaintiff’s pleading is amended under rule 26 to reduce damages to $200,000 or less, the action must proceed under Simplified Procedure.”
The court highlighted the accessibility and efficiency of Simplified Procedure, emphasizing that it would ensure “an expeditious and least expensive determination of this proceeding on its merits.”
It did admit the timing of the request to amend was “less than ideal.” But it pointed out that it “significantly” reduced the the potential exposure faced by Credential in the litigation.
For more information, see Ricci v. Credential, 2024 ONSC 2319 (CanLII).
