1.2: Purpose and intention of these rules
1.7: Interpreting these rules
3.31: Statement of defence
4.33: Dismissal for long delay
5.10: Subsequent disclosure of records
5.14: Inspection and copying of records
5.6: Form and contents of affidavit of records
6.14: Appeal from master’s judgment or order
15.4: Dismissal for long delay: bridging provision

Case Summary

The Defendants unsuccessfully applied to dismiss the Action against them for long delay pursuant to Rule 4.33. The Defendants argued before the Master that the last thing done to significantly advance the Action was compliance with a prior Order to compel them to answer refusals during Questioning on October 4, 2010. They argued that the Plaintiff’s October 30, 2013 Supplemental Affidavit of Records did not materially advance the Action because those documents had either already been produced or had been provided in settlement discussions. The Plaintiff argued, inter alia, that its Supplemental Affidavit of Record satisfied an ongoing obligation to provide a further Affidavit of Records as new material emerged, pursuant to Rule 5.10. The Master agreed that the Supplemental Affidavit of Records was a significant advance in the Action, dismissing the Application. The Defendants appealed the Master’s Decision. The Appeal centred on whether the settlement correspondence and Supplemental Affidavit of Records materially advanced the Action.

Justice Jones considered the context of the case in light of Rule 4.33 and the transitional Rule 15.4. His Lordship observed that the main changes from the old Rules to the new Rules were the reduction in length of the delay from five to three years and that the question is now whether a thing has been done to “materially advance” the Action, as opposed to whether there has been any “significant advance” in the Action. However, Jones J. noted that the general principles continue to apply. The Supplemental Affidavit of Records was provided before Rule 4.33 came into force, when Rule 15.4 applied. Justice Jones therefore applied the guidelines set out in Trout Lake Store Inc v Canadian Imperial Bank of Commerce, 2003 ABCA 259 (CanLII), to determine the relevant period of alleged inactivity, and stated that:

…proceedings should be examined from the date of the Application to dismiss for delay, which is February 24, 2014. Under Rule 4.33, this Court will consider whether at any time prior to February 24, 2014, there has been a gap of three or more years where there has been no significant advance in the Action.

The parties agreed that compliance with the Order on October 4, 2010 was a step that significantly advanced the Action (the Defendants argued this was the last significant advance). Therefore, the applicable period was from October 4, 2010 to February 24, 2014. Justice Jones accepted that privileged settlement correspondence could be relied on in response to an Application under Rule 4.33. With respect to the Supplemental Affidavit of Records, which was missing the Schedule 1 documents due to inadvertence, Justice Jones observed that Rule 5.6 requires that an Affidavit or Records is to be in Form 26, which includes the schedules. The Defendants did not alert the Plaintiffs, or request to inspect or receive a copy of the records, which they could have done pursuant to Rule 5.14.

Justice Jones assessed whether the settlement correspondence and Supplemental Affidavit of Records materially advanced the Action, noting that this required a functional analysis which considers the overall purpose of the Rules, as set out in Rule 1.7. Justice Jones noted that the application of the “drop dead” Rule should consider the “cultural shift” advocated by the Supreme Court of Canada in Hryniak v Mauldin, 2014 SCC 7 (CanLII). Further, Rule 1.2 provides that disputes should be resolved in a fair, just and efficient “Court process”; a Trial is not the only Court process. In light of these principles, Justice Jones considered the applicable question to be whether the parties’ actions “analysed individually, cumulatively and collectively, significantly advance resolution of the Action”.

Jones J. held that, in the circumstances, the settlement correspondence did not accomplish much to clarify the issues or significantly advance the Action towards resolution. Justice Jones noted that the issue of whether an Action may be advanced through a party’s compliance with Rule 5.10 and the ongoing obligations of production requires a factual inquiry. Because the documents produced in the Supplemental Affidavit of Records were already in the Appellants’ possession, the Supplemental Affidavit of Records did not significantly advance the Action. Justice Jones commented that filing a Statement of Defence within 20 days, as required by Rule 3.31(3)(a), or appealing a Master’s Order within 10 days, as required by Rule 6.14, are examples of steps that are of more significance than the requirement of Rule 5.10 to produce additional records at some undetermined time in the future. Accordingly, the Defendants’ Appeal was allowed, and the Action was dismissed.

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Related to 1.2

Related to 1.7

Related to 3.31

Related to 4.33

Related to 5.6

Related to 5.10

Related to 5.14

Related to 6.14

Related to 15.4