BREWIN v MAGYAR, 2022 ABKB 729
3.65: Permission of Court to amendment before or after close of pleadings
The Defendant appealed from the Decision of the Applications Judge to permit the Plaintiff’s Application to amend her Statement of Claim. An Application to amend Pleadings after the close of Pleadings is governed by Rule 3.65. Poelman J. cited Balm v 3512061 Canada Ltd, 2003 ABCA 98 for the proposition that any Pleading can be amended no matter how careless or late the amendment sought is. However, there are four commonly recognized exceptions, where the discretion to allow amendments should not be exercised: (1) Where they would cause serious prejudice not compensable in Costs; (2) Where the amendment requested is “hopeless”; (3) Where the amendments seek to add a new Party or a new cause of action after expiry of limitation period, unless permitted by statute; and (4) Where there is an element of bad faith associated with the failure to plead the amendment in the first instance.
Serious prejudice not compensable in Costs is likely to be established where the proposed amendments relate to events that occurred long ago, there have been many years of litigation on original Pleadings, or the amendments fundamentally change the issues and will cause further delay. A proposed amendment is “hopeless” where it does not disclose a cause of action or is so inconsistent with the record. When amendments are sought after possible expiry of a limitation period, it is preferable to resolve the limitation issues when the Application is made. Where complexity of the facts or records preclude a final Decision, the amendments should be allowed, the Defendants should be permitted to plead the limitations defence, and the issue should be resolved at Trial. A Party opposing an amendment on the ground of bad faith must prove the allegation on a balance of probabilities. Bad faith exception is not intended to punish negligent delays.
Poelman J. ruled that although evidentiary threshold is not enumerated as one of the exceptions, it may lead to a finding that an amendment is hopeless. Although the evidentiary threshold usually is low, some evidence is required to amend after the close of Pleadings. The Applicant does not need to show the amended Pleading can be proved at Trial or would meet the test for Summary Judgment. However, it does not preclude weighing of evidence. While the mere presence of contradictory evidence does not necessarily prevent an amendment, merely providing some evidence on each point is insufficient.
Poelman J. further held that where there are allegations of fraud, highhandedness, or malicious conduct, the evidentiary threshold is significantly elevated. The Applicant must, with significant evidence, show “good ground” or “exceptional circumstances” for such amendments.
In this case, the amended Statement of Claim alleged that the Defendant, among other things, “fraudulently misrepresented and withheld information”. Specifically, it was alleged that the Defendant excluded from the inventory contained in the Application for probate “any information about or reference to or quantification of the bank accounts and financial assets”. The Plaintiff acknowledged that she signed the probate Applications, but had not been allowed to participate in compiling the information and involuntarily signed the documents “by being bullied, manipulated, threatened and coerced”.
Poelman J. agreed with the Decision of the Applications Judge to allow some of the amendments sought but differed from the Applications Judge on the others. The amendments for the wrongful conversion of banking assets or other assets were not permitted, nor were the amendments related to estate administration. Poelman J. found that there was prejudice not compensable in Costs for the categories of wrongful conversion and estate administration and that higher evidentiary threshold for fraud was not met.View CanLII Details