This was an Appeal of two Orders of an Applications Judge.

The Defendants, a corporation and the individual owner (the “Owner”) (together, the “Defendants”), shared the same legal counsel, who requested the Plaintiff not to note the Defendants in Default without prior written notice. Despite this, the Owner was not included in the Statement of Defence filed by the corporation due to an apparent counsel error. Subsequently, the Defendants applied for Summary Dismissal pursuant to Rule 7.3.

Despite counsel’s request, the Plaintiff noted the Owner in Default without prior written notice. In response, the Owner filed an Application to set aside the Default (the “Setting Aside Application”).

Applications Judge Prowse issued two Orders: (1) Setting aside the Noting in Default against the Owner (the “Setting Aside Order”); (2) Granting Summary Dismissal of the Plaintiff’s claim against the Defendants (the “Summary Dismissal Order”). The Plaintiff appealed both Orders.

The Court noted that, pursuant to Rule 6.14, an Appeal of an Applications Judge’s Decision is
de novo, and that the standard of review was correctness on all issues. The Court further noted that, under Rule 6.14(3), an Appeal from an Applications Judge’s Decision is an Appeal on the record of proceedings before the Applications Judge. However, new evidence may be admitted if the Judge hearing the Appeal considers it relevant and material.

In upholding the Setting Aside Order, the Court confirmed that when fairness requires it to be granted, Rule 9.15(3) gives the Court discretion to set aide a Default Judgment. The Court held that the Owner showed that she had an arguable defence because: (1) the failure to file a defence was a mistake on the part of her counsel; (2) her counsel’s correspondence and the Summary Dismissal Application clearly indicated her intention to defend; and (3) the Plaintiff unfairly attempted to take advantage of the mistake made by the Owner’s counsel, while the Owner promptly filed the Setting Aside Application.

With respect to the Summary Dismissal Order, the Court considered the test for Summary Judgment from Weir-Jones Technical Services Inc v Purolator Courier Ltd, 2019 ABCA 49, which requires that the Court be able to make the necessary findings of facts, apply the law to the facts, and be satisfied that Summary Judgment is a proportionate, more expeditious and less expensive means than a Trial to achieve a just result.

Furthermore, Rule 7.3(1)(b) allows a Defendant to apply for Summary Dismissal if “there is no merit to a claim or part of it.” The Court applied the principles from Hryniak v Mauldin, 2014 SCC 7, and held that it was not possible to fairly resolve this dispute on a summary basis, as the Defendants had not adduced sufficient evidence which, on the balance of probabilities, established there was no merit to all of the Plaintiff’s claims.

As a result, the Court dismissed the Appeal against the Setting Aside Order and allowed the Appeal of the Summary Dismissal Order.