Normally, a motion judge’s decision dismissing an action for delay is entitled to considerable deference. Similarly (from the perspective of encouraging finality), a motion to admit fresh evidence on appeal will generally not be allowed if the evidence could have been tendered in the Court below through reasonable diligence. However, in Om Sai Physiotherapy Clinic Inc. v. Kucher, released publicly on October 23, 2015, the Ontario Court of Appeal allowed fresh evidence to be admitted even though it did not meet the diligence requirement. This was because the evidence remained relevant to an ongoing counterclaim. Though the dismissal of their action was overturned, the appellants nonetheless suffered costs consequences in these circumstances. The Court reasoned:

[3]        In reviewing the reasons for judgment of the motion judge, we conclude that he applied the correct legal principles and did not misapprehend the evidence before him about the non-compensable prejudice to the respondent that the absence of certain of the appellants’ records might cause.

[4]        As a result, we see no error by the motion judge in his exercise of discretion, on the record as it existed before him.

[5]        However, we have before us the appellants’ motion for leave to file fresh evidence. The fresh evidence consists of bank statements and other financial documents that the appellants undertook to produce on the examination for discovery of the Clinic’s representative on July 15, 2011, but had not produced by the time of the motion.

[6]        The fresh evidence does not meet the due diligence requirement under Palmer v. The Queen, [1980] 1 S.C.R. 759. Obviously, the documents which constitute the fresh evidence were available not only at the time of the motion, but at the time the undertakings were given back in 2011. In ordinary circumstances, this would be sufficient to refuse to admit the fresh evidence. However, in this case, the fresh evidence is relevant not only to the Clinic’s claim, but also to the appellants’ defence to the respondent’s counterclaim – specifically, to their defence to the respondent’s claim for damages for defamation. The counterclaim raises much the same evidentiary issues as does the claim. For example, whether a misappropriation of funds occurred remains a live issue in the counterclaim as a defence by the appellants to the defamation allegation. The respondent intends to pursue his counterclaim, and the fresh evidence therefore is relevant to an on-going action.

[7]        With the fresh evidence now showing that the undertakings are complete, and with the fresh evidence remaining relevant to the respondent’s counterclaim, we grant the motion for leave to file fresh evidence and we allow the appeal, restore the Clinic’s Statement of Claim and the appellants’ Reply and Defence to Counterclaim, and restore the Clinic’s action to the Brampton trial list.

[8]        However, we vary the costs award below to $3,000, payable by the appellants to the respondent. It was the appellants’ delay in fulfilling their undertakings that caused the problem and that delay was completely within the appellants’ control to cure.

[9]        There will be no costs of this appeal.