11.25: Real and substantial connection
11.27: Validating service

Case Summary

This was an Appeal of a Master’s Decision to refrain from setting aside a Noting in Default and associated Default Judgment. The Appellant was a Defendant in the underlying Action, which involved a contractual claim. Though it was not disputed that the claim had a real and substantial connection to Alberta, the Appellant was ordinarily resident in Ontario and was served there. The Appellant, who was represented by a litigation representative, argued that the Noting in Default and Default Judgment should be set aside (1) on the basis of a “non-trivial flaw” in the Respondent’s process, and (2) in light of the ordinary test for setting aside a Default Judgment, which she argued was satisfied.

Regarding the first basis for setting aside, the Appellant argued that the Respondent had failed to adequately disclose in the Statement of Claim the grounds for service outside of Alberta, as required pursuant to Rule 11.25(1)(b), and that such failure constituted a non-trivial error. While the Court agreed that the existence of “real and substantial connection” to the jurisdiction was a non-trivial matter, it distinguished the requirement to indicate such connection from the requirement to specifically set out the grounds for service, which, the Court noted, will typically simply indicate that the responding party is situated outside of the jurisdiction. Failure to make such indication where the Statement of Claim otherwise indicates that there is a real and substantial connection between the Action and the jurisdiction is “most often” trivial. The Court further held that, if it was wrong in its assessment of triviality generally, it would nonetheless exercise its discretion pursuant to Rule 11.27 to excuse the error. Accordingly, the Court held that the Default Judgment should not be set aside on the basis of non-trivial flaw.

Regarding the second basis for setting aside the Default Judgment, the Court found that the Appellant had failed to satisfy the second and third branches of the applicable test, namely, she had failed to show that she had a reasonable excuse for letting the Judgment go to Default, and she had failed to show that she had acted promptly to set aside the Noting in Default/Default Judgment. The Court noted that the onus rests with the Applicant (in this case, the Appellant) to demonstrate satisfaction of the test. In this case, the evidence established that the Appellant had consulted with counsel following receipt of the Statement of Claim and the Default Judgment, and had nonetheless failed to respond in a timely fashion or at all. The Appellant had not adduced evidence to establish that she was incapable of responding on the basis of health reasons or otherwise at the relevant time. Accordingly, the Appeal was dismissed.

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