The Plaintiff appealed the decisions of a Master striking its Action against the Defendants for inordinate delay under Rule 4.31, and discharging a Builder’s Lien and Certificate of Lis Pendens filed against the Defendants’ home in respect of the Action. The Plaintiff commenced the Action in 2004 claiming that the Defendants were indebted to the Plaintiff for the construction of their house. The Defendants counterclaimed for overpayments and construction defects. The Defendants argued that the last significant advance in the Action occurred in 2009 when the Plaintiff’s corporate representative was questioned, while the Plaintiff argued that the last significant advance was in 2013 when the Plaintiff provided Undertaking Responses and applied for a Litigation Plan.

Justice Shelley noted that the Rules provide for two ways in which an Action can be dismissed for delay: Rule 4.31 permits the Court to dismiss an Action on a discretionary basis if, in the Court’s determination, the delay has resulted in significant prejudice to a party; and, Rule 4.33 allows an Action to be struck if more than three years have passed since there has been any significant advance. Justice Shelley observed that, although the language of Rule 4.31 suggests that the Court may use its discretion which usually implies some deference, the standard of review on an Appeal is correctness. Further, while Rule 4.31(2) creates a presumption of serious prejudice, it does not shift the overall burden of proof, and an Applicant must still establish a likelihood of serious prejudice before the Action will be struck. To rebut the presumption, there must be evidence that at least raises a legitimate doubt about the existence of serious prejudice.

Shelley J. briefly considered Rule 1.2(2) which stresses the importance of quick and timely resolution “as soon as practicable”, at the “least expense”. Justice Shelley observed that Rules 4.31 and 4.33 are examples of these foundational principles.

Shelley J. concluded that the Plaintiff’s delay was both inordinate and inexcusable. The Plaintiff did not lead any evidence to rebut the presumption of prejudice under the Rules. In fact, the Plaintiff’s own answers to Undertakings raised the problem of documents that could not be found and fading memories. Justice Shelley held that the Defendants had established “significant prejudice” warranting dismissal of the Action under Rule 4.31. This prejudice could not be cured by procedural Orders under Rule 4.31(1)(b). As a result, Shelley J. determined that the Master was correct to dismiss the Action under Rule 4.31, and it was therefore irrelevant whether the answers to Undertakings significantly advanced the Action. The Appeal was dismissed.