994552 NWT LTD v BOWERS, 2017 ABQB 741

Master Schlosser

4.31: Application to deal with delay
4.33: Dismissal for long delay

Case Summary

The Defendants applied to strike a Claim for long delay pursuant to Rule 4.33. The Claim related to theft of two million dollars by one of the Defendants. Criminal proceedings dealing with the same subject matter were ongoing.

The steps that had occurred in the Action were: on July 15, 2013, a Consent Order was entered requiring one Defendant to provide Answers to Undertakings by July 31, 2013; by July 31, 2013, Answers to Undertakings were provided by two Defendants; on August 9 and 13, 2013; Answers to Written Interrogatories were accidentally filed by three Defendants (and subsequently “un-filed” pursuant to a Consent Order in March, 2015); on September 6, 2013, a Consent Order was entered to set a deadline for Undertaking Responses of another Defendant; on July 29, 2016, a Notice to Admit Facts was served on some of the Defendants; and counsel for three of the Defendants filed a Notice of Withdrawal on August 2, 2016.

Master Schlosser noted that, pursuant to Rule 4.33(2), if an advancement in an Action against one party “advances the Action as a whole, it is an advancement against all.” The Consent Order of July 15, 2013, did not significantly advance the Action. Master Schlosser noted first that the Defendant had never actually, provided Answers to Undertakings in accordance with the Order, and was prima facie in contempt of Court. Just as Parties cannot rely on their own delay to strike an Action pursuant to Rule 4.31, individuals in breach of Court Orders that, if completed, could have significantly advanced an Action, cannot rely on Rule 4.33 to strike the Action for long delay. However, even if the Defendant had provided answers to Undertakings in accordance with the Order, it would not have significantly advanced the Action, as the evidence sought would not have been of significant assistance in determining any issues in the lawsuit.

The Consent Order of September 6, 2013, also compelling Answers to Undertakings, also did not significantly advance the Action. Master Schlosser noted that Consent Orders respecting Answers to Undertakings generally do not significantly advance an action. Nevertheless, the “functional approach” should be used in determining whether there was a significant advance. Here, the Defendant that was the subject of the Order did not answer the Undertakings and subsequently became bankrupt. As such, the Action against her was stayed, and it was not possible to tell whether her responses would have been a significant advance.

Master Schlosser held that filing and then “un-filing” of Interrogatory Answers, the Notices to Admit Facts, and the filing of Notices of Withdrawal of some counsel, did not constitute advances in the Action. The concurrent criminal proceedings also did not advance the Action, though Master Schlosser noted that it was possible for an advancement in the closely related criminal proceedings proceeding to count as an advance in this case if it was “determinative of one of the issues in the instant case in order to count as an advance”.

As such, Master Schlosser held that the Action was not significantly advanced between July 31, 2013, and July 31, 2016. Since Rule 4.33 requires that the Court dismiss an Action against the Applicants if there had not been a significant advance in three years, Master Schlosser dismissed the Action against the Applicant Defendants.

The Action was not dismissed as against Terrance Bowers, 1121052 Alberta Inc. and D. Caer Management Inc. as their materials were filed late in breach of a prior Order.

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