3.72: Consolidation or separation of claims and actions
4.31: Application to deal with delay
4.33: Dismissal for long delay

Case Summary

The Defendant/Applicant, Permasteel Construction Ltd. (“Permasteel”), appealed a Master’s dismissal of its Application to dismiss the Action for delay pursuant to Rules 4.31 and 4.33. The Master had considered Rule 4.33 which requires the Court to dismiss an action where three or more years have passed without a significant advance in the action. The Master ruled that an Order to have two matters underlying the Action tried concurrently was a significant advance and thus declined to dismiss the Action on the basis of Rule 4.33. Permasteel took no issue with the finding that the Order was a significant advance, but argued that the Order had simply formalized an earlier agreement, meaning the significant advance had actually occurred more than three years prior. Ross J. disagreed and noted that consolidation can take at least three forms under Rule 3.72: full consolidation, Trial at the same time, or Trials one after another. Although consolidation of some sort had been advocated for as early as 2006, there was no agreement between the parties about how to consolidate the two Actions until the Order to consolidate was granted. Therefore, Ross J. upheld the Master’s ruling that the Action could not be dismissed pursuant to Rule 4.33.

In considering the Application brought under Rule 4.31, Ross J. confirmed that once the Court finds that delay is “inordinate” and “inexcusable”, it is presumed that the moving party has suffered the significant prejudice required by Rule 4.31 to dismiss the claim. However, the non-moving party has the opportunity to rebut this presumption. There was no debate that the delay in this case was inordinate – the Action had been ongoing for some 11 years. However, the Master had ruled that the presumption of significant prejudice had been rebutted, as the case was primarily a document case that would not be hampered by the passage of time, and because the matter was essentially ready for Trial. Ross J. disagreed, and held that the Master had applied the old standard of rebutting the presumption of significant prejudice - that of a “legitimate doubt.” As Ross J. noted, this standard has been replaced by a requirement to displace the presumption of significant prejudice on a balance of probabilities. Ross J. held that had the Master applied the correct standard, the presumption would have remained intact, and the Action would have been dismissed. There was evidence that this case was not simply a documents case and there was not definitive evidence that the Action was ready for Trial. Ross J. dismissed the Action pursuant to Rule 4.31.

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