EMM ENERGY INC v CANADIAN NATURAL RESOURCES LIMITED

This was an Appeal from the dismissal of an Application to strike a Claim for delay, pursuant to Rule 4.31. The Respondent commenced the Action in 2009 for alleged damage to an oil and gas formation. In 2022, the Appellant applied to dismiss the Claim for inordinate delay pursuant to Rule 4.31, and the Applications Judge struck the Claim.

The Respondent appealed that decision and a Chambers Judge allowed the appeal. The Chambers Judge found the delay, while inordinate, did not meet the requirements for dismissal under Rule 4.31 since it was excusable and caused no significant prejudice.

The Appellant then appealed the Chambers Judge’s decision. The parties agreed with the Chambers Judge that the delay was inordinate. Therefore, the issues on Appeal were whether the Chambers Judge erred in finding that the delay was excusable and that the Appellant suffered no significant prejudice.

A unanimous panel of the Court of Appeal dismissed the Appeal. The Court found no reviewable error in the Chambers Judge’s analysis of delay or prejudice under Rule 4.31 and held that those findings were entitled to deference.

The Court upheld the finding that the delay was excusable. The Appellant argued that the Chambers Judge erred in applying Rule 4.31 by focusing too much on the Appellant’s conduct rather than the Respondent’s obligation to advance the Action, effectively reversing the onus to justify the delay. The Court rejected this argument, confirming that Rule 4.31(3) expressly requires the Court to consider whether the party seeking dismissal contributed to the delay. Further, the Court noted that the Chambers Judge also considered delay attributable to the Respondent. There was no palpable and overriding error in the Chambers Judge’s conclusion that both parties contributed significantly to the delay.

The Court of Appeal also upheld the finding that no significant prejudice was established. The Chambers Judge was entitled to deference with respect to findings that the Action was “largely a documents case” and changes in personnel or witness availability did not impair the Appellant’s ability to respond to the Claim.