On February 8, 2019, the Alberta Court of Appeal issued two decisions with respect to the use of the drop-dead rule in the context of motor vehicle accidents, Delver v Gladue, 2019 ABCA 54, and Thiessen v Corbiell, 2019 ABCA 56. At common issue between these appeals was the matter of how Rule 4.33(2) of the Alberta Rules of Court bars plaintiffs from recovery if they do not prosecute their civil claims in a timely fashion.
For reference, the Rule reads as follows:
(2) If 3 or more years have passed without a significant advance in an action, the Court, on application, must dismiss the action as against the applicant, unless
(a) the action has been stayed or adjourned by order, an order has been made under subrule (9) or the delay is provided for in a litigation plan under this Part, or
(b) an application has been filed or proceedings have been taken since the delay and the applicant has participated in them for a purpose and to the extent that, in the opinion of the Court, warrants the action continuing. [emphasis added]
In each case, the appeal focused on whether a step in the process was a significant advance.
I will first review the facts and analysis in Thiessen and then turn to Delver. Since this process entirely depends on timelines, it's important to note that the application to dismiss the claim was filed on August 11, 2017, and heard on October 6, 2017 by a Master in chambers. Since the parties agreed that answers to undertakings made in August 2014 satisfied a significant advance, the Master was tasked with determining whether two other steps in the litigation also satisfied that test.
The first step was an Application by the Defendants/Applicants to have Thiessen's two accidents heard together and with respect to quantum only. The Order consented to by all parties went unsigned as a Justice in chambers rightly pointed out on November 16, 2015 that liability needed to be determined/admitted in both cases before a Trial on both actions could be heard on quantum only. One of the Defendants would not admit liability, so no further Consent Order was made or filed. The matter had begun to languish.
The next step effected by the parties was an agreement to attend mediation before a named mediator in June of 2017. One week before the mediation, Plaintiff's counsel excused himself for personal reasons and sought adjournment of the mediation until the later in the Fall when the mediator was available again. Before the parties set down a new date for mediation, the Defendants brought their Application before the Master to dismiss the actions against them for long delay pursuant to Rule 4.33.
The Court of Appeal, on hearing these facts, pointed out that there is no hard and fast rule, and quoted the functional approach to long-delay applications as set out in Weaver v Cherniawsky, 2016 ABCA 152. Put simply, the test from Weaver asks a chambers judge to examine whether a step has actually moved the lawsuit forward when considering the nature, value, importance, and quality of the said step. The genuineness and timing of the steps are also relevant factors which a judge may consider. Overall, the judge is to look at the substance of the step taken and its effect on the litigation. (see para 20 of the Thiessenreasons on CanLII).
In the language of the Court, neither the failed attempt to have the actions tried together and only on damages nor the scheduled mediation narrowed the issues or moved the parties to resolution. Importantly, the Court indicated that a lack of filed briefs, pre-hearing arrangements, or any evidence of meaningful negotiations were fatal to Thiessen's action.
I believe the decision of the Court in Thiessen was wrongly made. Firstly, I added emphasis to the Rule that I think is salient here, namely that the Defendants were the Applicants in the 2015 order seeking to have the matters heard together and also Applicants in the application to dismiss. In either sense, the Defendant insurers, or more likely their counsel, must have participated heavily in the process to have come to a Consent Order between themselves and Plaintiff's counsel. To then rely on the fact that those same Applicants ultimately failed to obtain an Order to dismiss the Plaintiff's claim is ludicrous. Narrowing an action to quantum of damages is directly contrasted to the finding of the Court of Appeal that nothing done in the three years since answering undertakings "narrowed the issues" or moved the parties to resolution. Secondly, the fact that the parties were going to non-essential meditation should be at least prima facie evidence of intent to negotiate settlement of the Plaintiff's claims.
In Delver, the Plaintiff had made two attempts to advance the litigation:
Plaintiff's counsel had attempted to have the insured car owner and the Administrator of the Motor Vehicles Accident Claims fund agree to a trial on the narrow issue of whether or not the operator of the motor vehicle had consent to drive the vehicle that caused the accident at the relevant time. This was important because if the driver did not, in fact, have consent, then the driver was essentially operating the vehicle as an uninsured driver and the Plaintiff could assign any Judgment in respect of bodily injury damages she received against the driver to the Administrator of the fund (to a maximum of $200k, last I checked). This occuredThe Plaintiff, through counsel, attempted to settle the claim via a full and final settlement offer which was ultimately rejected by both parties.
The chambers judge would have allowed the action to be commenced so long as the Plaintiff set the matter down for trial or severance of the issue of quantum from the issue of consent on or before March 1, 2019 and issued a Judgment to that extent which was the subject of the Appeal.
The majority of the Appellate Court emphasized that although the chambers judge applied the right test, that the efforts by the plaintiff did not provide any new information, narrow any of the issues between the parties, or clarify the positions of any of the parties. The single determination of the issue for Justices Strekaf and Crighton was that although the actions taken by the Plaintiff could have advanced the litigation, they just didn't. If a settlement offer discloses new information than narrows issues, then it could advance a litigation. Likewise, the Court of Appeal was compelled by the Defendants submission that the issue of liability as between the Defendants was obvious. This was again critical to the fact that the attempt by the Plaintiff to narrow the Trial to the issue of liability/consent didn't really put anything out there that wasn't already and clearly understood by the parties before that step was attempted.
The failure of the Plaintiff to actually move the litigation forward in the face of uncooperative defence counsel prompted the dissenting opinion written by Justice O'Ferrall. In that Justice's dissent, he observed that that the 'true' intent of Rule 4.33 was to provide some mechanism for Defendants to have actions which have truly gone unprosecuted to be finalized. I would paraphrase this to say that Rule 4.33 is not intended to act as a civil and regulatory form of the Jordan decision. The dissenting Justice further goes on to say that the opinion of the majority encourages stalling behaviour on the behalf of Defendants who can ultimately rely on Rule 4.33 to terminate arguably meritorious claims.
I agree with the Justice O'Ferrall that this case demands a look at why this rule was put into place and how its use has affected parties to litigation. However, I was not convinced by his argument that the tragic circumstances of the Plaintiff justify any further consideration. The compelling rhetoric (not in the pejorative sense) of Justice O'Ferrall was that the Rules have clearly stated that their purpose -according to Rule 1.2(1)- is to "provide a means by which claims can be fairly and justly resolved."
The Rules also state in subsection 2 that the Rules are intended to:
facilitate the quickest means of resolving a claim at the least expense;
encourage [settlement] as early in the process as practicable;
oblige the parties to communicate honestly, openly, and in a timely way;
[emphasis added]
As I see it, any outcome or ruling by the Court of Appeal which encourages defence counsel to stall or delay is contrary to the purpose of the Rules. Furthermore, we know from the ample and constant reminder of the supreme court of Canada that legislation is to be read as a whole such that no single provision is redundant or rendered useless by a further provision. So what we can take from the fact that both Rules 1.2 and 4.33 coexist is that 4.33 must not discourage settlement or negotiation of settlement, it should not encourage stalling and delay by any party, and it should not be a catch-all resolution for claims which should be justly and fairly resolved.
Delver is in fact the first time that an Appellate Justice has written a dissenting opinion in civil application of this Rule where the majority has, in effect, dismissed a claim. I reviewed the 21 Alberta Court of Appeal cases reported on CanLII and in none but Canada v Delorme, 2016 ABCA 168 did this circumstance show up. However, that case was clearly plagued with problems and it was obvious that fault lay on the Plaintiff and their counsel. Knowing this, I would not be surprised to see at least an Application for leave to appeal to the Supreme Court of Canada by counsel in Delver.
As a quick reminder, you shouldn't necessarily bemoan the outcome for Plaintiffs in Thiessen and Delver because their lawyers have insurance that could compensate those Plaintiffs for their loss.
Thanks again for reading this article, I look forward to writing many more in the future.