The Plaintiff commenced their Action against the Defendants on February 12, 2016 (the “Trades Action”), and also commenced a separate Action against its insurer, Lloyd’s of London (“Lloyd’s”), around the same time (the “Coverage Action”). The Trades Action and the Coverage Action both concerned a fire that took place on a construction project.

In 2017, Lloyd’s applied to consolidate the Coverage Action with the Trades Action (the “Consolidation Application”). The Plaintiff and Defendants in the Trades Action agreed to oppose the Consolidation Application, and the agreement provided that, if they successfully opposed the Consolidation Application, the Plaintiff would pursue the Coverage Action to trial before the Trades Action (the “Agreement”). They were successful in opposing the Consolidation Application and, since then, the Plaintiff only took steps in the Coverage Action.

The Defendants brought an Application to dismiss the Trades Action for long delay pursuant to Rule 4.33. The Application was dismissed by Farrington J. on the basis that Trades Action and Coverage Action were inextricably linked, and there had been significant steps taken in the Coverage Action. The Defendants appealed.

On Appeal, the Court began by considering whether the Agreement was a “standstill agreement”. The Court cited comments from the Alberta Court of Appeal in Flock v Flock Estate, 2017 ABCA 67, that Rule 4.33 must be read in light of the foundational rules, including that Rule 1.2(2)(b) stipulates that the Rules are intended to facilitate the quickest means of resolving a dispute at the least expense on the merits. Rules 4.1 and 4.2 also make this clear. The Court ultimately found that, although the Agreement was not as clearly drafted as a standstill agreement should be, it contained the essential terms to suspend the application of Rule 4.33(2) in the Trades Action. Justice Price also agreed with Application Judge Farrington’s finding that the Trades Action and Coverage Action were inextricably linked.

In closing, the Court noted that there was discussion regarding the application of Rule 4.31 at the oral hearing. However, Price J. held that Rule 4.31 did not apply as there was no inexcusable delay or significant prejudice. The Appeal was dismissed.