Edited by Amanda Kostek and Kristen Hansen
Last week’s Court Rulings from the Alberta Court of King’s Bench, Court of Appeal and SCC.
Catterall v Condominium Plan No. 752 1572 (Park Towers), 2024 ABKB 452
Inflationary factor of 25% applied to Schedule C Costs
Osadchuk v Kidd, 2024 ABKB 448
Validity of Service of Claim
Segovia v McCarrick, 2024 ABKB 431
Dismissal for Delay
H2 Canmore Apartments LP v Cormode & Dickson Construction Edmonton Ltd., 2024 ABKB 428
Application for extension of time to file Third Party Claim
H2 Canmore Apartments LP v Cormode & Dickson Construction Edmonton Ltd., 2024 ABKB 423
Suitability of Summary Judgment Applications for named individuals associated with corporate defendants in large complex litigation
Mao v TD Insurance Meloche Monnex, 2024 ABKB 434
Requirements for Expert Evidence on Standard of Care
Simpson v Pawlowski, 2024 ABCA 254
Application for Contempt for use of evidence in one action in another action/ Implied Undertaking
Catterall v Condominium Plan No. 752 1572 (Park Towers), 2024 ABKB 452
In Catterall v Condominium Plan No. 752 1572 (Park Towers), 2024 ABKB 452 the Court awarded a 25% increase in schedule C costs on the basis that the amounts set out in Schedule C are “out of date”:
[35] The Applicants shall pay the Respondent Schedule C, column 1 costs of the action up to the costs submissions with a 25% increase in the fee amounts. If the parties are not able to agree on the amount, costs may be assessed by an Assessment Officer.
Osadchuk v Kidd, 2024 ABKB 448
n Osadchuk v Kidd, 2024 ABKB 448 the Defendants sought an order declaring service on an U.S. based entity to be a nullity on the basis that the order for service outside Canada was not in the form of a traditional order for service ex juris (order for service outside Canada). The Court accepted that under Rule 11.25 an order for Service outside Canada is a pre-requisite to serving the claim, and that an additional requirement under the case law is to establish an “arguable case” in the Affidavit in Support for the Order. In this case, the latter comment by the Court may be an error, as the requirement to show an “arguable case” is a throwback to the prior version of the Rules of Court, which was later changed by statute to remove that requirement. Nonetheless, the Court concluded that the first attempt at service was ineffective as it did not comply with the Rules for service outside Canada, but that a subsequent Order did meet those requirements.
Key in the case is that the Court rejected the assertion that service could only be via the Hague Convention:
[54] Kidd says that I must effectively “read down” subrule 11.26(1) because it is expressly stated to be “subject to subrule (2)”. Therefore, Kidd says, the only way that a Plaintiff can serve commencement documents in a Convention country are methods expressly described in the Convention. I disagree. Subrule 11.26(2) does not say that service in a Convention country can only be via a method expressly described in the Convention. It says that service in a Convention country must be in accordance with Division 8. In subrules 11.34(1)(e) and (f), which are part of Division 8, the Alberta Legislature has chosen to permit service by methods that are not expressly described in the Convention.
Segovia v McCarrick, 2024 ABKB 431
In Segovia v McCarrick, 2024 ABKB 431 the Defendants sought to dismiss the Plaintiff’s personal injury claim for in ordinate delay under Rule 4.31 for a collision that occurred on April 18, 2011. Over 8 years had passed between the filing of the Defence and the Application. The claim was complicated by the Plaintiff’s involvement in 4 subsequent accidents. As of the time of the application, the Defendants alleged that undertakings remained incomplete, and IMEs had yet to be completed, because the Plaintiff asserted she could not be examined for long periods of time. The Court concluded that the major contributing factor to the delay was the overlay of 4 subsequent accidents, and concluded that although the delay had been inordinate, it was not inexcusable. Although prejudice was argued due to the passage of time, and fading witness memories, the Court noted that early statements to the Insurer were likely available. In terms of medical records no longer available, the Court noted they were one off attendances, and there was no evidence of whether those appointments had any relevance.
The Court was not prepared to dismiss the claim but noted that the Plaintiff had been uncooperative and difficult. The Court directed better cooperation.
H2 Canmore Apartments LP v Cormode & Dickson Construction Edmonton Ltd., 2024 ABKB 428
In H2 Canmore Apartments LP v Cormode & Dickson Construction Edmonton Ltd., 2024 ABKB 428 the Court dismissed an application for an extension of time to file a Third Party Claim 21 months after the expiry of the deadline in rule 3.45(c) of the Alberta Rules of Court on the basis that the application was brought too late, and that the involvement of the potential Third Party was no surprise:
[57] Construction disputes like this often involve numerous parties and many interrelated alleged construction defects and delay claims. There has been voluminous records production and many days of questioning. Such matters cannot efficiently proceed if parties clearly known to be potentially responsible for some of those issues are not brought into the litigation as early as reasonably possible. This is not a situation where Cascade’s involvement in the Project, or the potential implication of the Cascade Mechanical Work as being involved in the Plaintiffs’ claim, should have been a surprise to anyone, let alone Cormode.
[58] Based on this record, I find that Elzen and Cormode knew by July 2020, a year before it filed its Statement of Defence, and 18-months before the deadline to file a third party claim, about the need to file a third party claim against Cascade. On balance, I find that it has not provided a reasonable excuse for failing to do so at the time it filed its defence, let alone why it did not do so by December 2021, or thereafter. Further, Cormode appears to have recognized the potential for third party claims in paragraph 16 of its Statement of Defence, which alleges that the alleged deficiencies in the Statement of Claim “arose from the negligence, breach of duty, breach of contract, or breach of warranty of the Co-Defendants and/or another Third Party” (emphasis added).
[59] Cormode has not provided a sufficient explanation or reasonable excuse why it waited until September 2023 to seek to file a third party claim against Cascade, all the while knowing the Action was progressing with significant records production and oral questioning.
H2 Canmore Apartments LP v Cormode & Dickson Construction Edmonton Ltd., 2024 ABKB 423
In a separate decision for H2 Canmore Apartments LP v Cormode & Dickson Construction Edmonton Ltd., 2024 ABKB 423 the Court assesses whether employees/agents of a corporate defendant should be removed as named defendants in the action. At issue was whether human agents should be held personally liable for their actions in carrying out the business of the corporation. The Court acknowledged that there is no unifying test, but that the Hall factors remain relevant considerations. Those factors include:
- Whether the negligent act was committed while carrying out the work of the business;
- Whether the individuals were pursuing personal interests beyond the business’ interest;
- Whether the director or corporate representative owed a separate and distinct duty of care towards the injured party;
- Whether the work was “in the best interests of the company”;
- Whether the plaintiff voluntarily dealt with the limited liability corporation, or had the corporate relationship “imposed” on it;
- Expectations of the parties;
- Whether the tort was “independent”;
- Nature of the Tort;
- Type of damages (see paragraph 30 of the decision).
The Court allowed summary Judgment in respect of one employee, the CFO, because he was not generally involved in construction operations, nor design or construction of the Project. However, the President, Site Manager/Site Superintendent, and Professional Engineer involved in the project were unsuccessful in their applications to dismiss the claims against them personally in their entirety. The Court noted that some of the allegations in the Statement of Claim had no merit against the remaining employees personally, but it was not appropriate to grant Summary Judgement on a piecemeal basis:
[226] Second, while I have found that the negligence claims against the Cormode Personnel relating to non-dangerous defects, and negligent misrepresentations (other than as ancillary to dangerous defects) have no merit or genuine issues requiring a trial, in my view it is not appropriate to grant partial summary judgment for those claims. This matter is more complex than what was addressed in Parks QB and Parks CA. I agree with the Plaintiffs’ counsel that there is a “spider web” of facts involving many parties. In my view, attempting at this stage to parse out liability for dangerous versus non-dangerous defects, for those Cormode Personnel involved in, managing or supervising the design or construction, would not save any trial time and could very likely create fertile ground for interlocutory disputes and potentially inconsistent findings. I do not find summary dismissal to be appropriate for those claims. The consideration is different for Deacon who was not involved in design or construction.
[227] Third, I have a concern over unintended consequences of summarily dismissing some claims that are intertwined with others (including claims against other defendants in the Action), which raises the prospect of inconsistent findings between summary dismissal and trial, as well as other unintended or unforeseen consequences. For example, many of the claims for negligence causing economic harm are not meritorious on the Application Record, but are based on the same underlying facts as deceit claims which shall proceed. Summary dismissal will serve no practical benefit in the Action and may create unnecessary potential for disputes or inconsistent findings.
[228] Fourth, partial summary dismissal of some claims will not address the Cormode Personnel’s main concerns. There are genuine issues requiring trial for at least some of the claims which are most likely to have the most reputational impact on them (deceit and conspiracy). Those claims cannot be characterized as solely being made for “litigation leverage” as argued by the Cormode Personnel and they shall proceed to trial. Further, partial summary dismissal will not extricate any of the Cormode Personnel from the litigation. They will all remain involved in the Action and trial as parties and key witnesses even if partial summary dismissal of some claims is granted.
The Court was prepared to grant Summary Judgement on the following claims, however:
- pre-Contract negligent advice and pre-Contract negligent misrepresentation;
- breach of fiduciary duty; and
- claims for negligent design or construction against one employee who was not involved in these aspects of construction.
Mao v TD Insurance Meloche Monnex, 2024 ABKB 434
In Mao v TD Insurance Meloche Monnex, 2024 ABKB 434 the Court directed that Summary Judgment was not appropriate in a negligent misrepresentation claim without a standard of care expert to speak on the insurer’s actions in a negligent misrepresentation claim against an insurer.
[34] One might be tempted to conclude that this case is an exception to the requirement of expert evidence on the standard of care because TD’s recommendation was wrong. In my opinion that approach would be incorrect in the circumstances because, at the time the recommendation was made, all of those involved believed it to be true and appropriate, and only after a year had passed and subsequent investigations had been made was it discovered that there were possible other reasons for the water ingress.
….
[40] Notwithstanding the desire to facilitate a less lengthy pre-trial process where circumstances allow, in the present circumstances given the factual background, the nature of the relationship between the parties, together with the issues being determined, an application for summary judgment without expert evidence about the standard of care, cannot succeed. While the rules of evidence may be relaxed in the Court of Justice, they cannot be similarly relaxed in the Court of King’s Bench solely on the basis of the amount of money being claimed. Further, while it is completely reasonable to expect that an insured would act on the recommendation made by an insurer, it is not clear on the record that the recommendation made by TD was inaccurate.
Simpson v Pawlowski, 2024 ABCA 254
This was an appeal of a chambers decision declining to hold the Defendants and their lawyers in contempt for using an email disclosed to them in collateral litigation as evidence in a collateral action involving the same parties. The Applicants alleged that this was a breach of the implied undertaking codified in Rule 5.33 of the Alberta Rules of Court.
The Court noted that the implied undertaking does not apply to filed Affidavits as they are part of the public record:
[12] The undertaking of confidentiality therefore does not cover filed affidavits and cross-examination on affidavits that are properly part of the public record (if not sealed). Disclosure is “permitted by law”, as contemplated by Rule 5.33(1)(c), and the affidavit and its exhibits may be used in other proceedings: Klein v Wolbeck, 2016 ABQB 28 at paras 8-9, 29 Alta LR (6th) 135 [Klein], and citing Juman v Doucette, 2008 SCC 8 at para 35, [2008] 1 SCR 157 [Juman]. Concerns about the confidentiality of disclosed information may be addressed through other mechanisms, such as a restricted court access order under Rules 6.28 to 6.36 or a confidentiality order.
In this case, the impugned email was attached to an Affidavit in the first action to compel a further and better Affidavit of Records. As a result, it became part of the public record and was accessible for use by the Defendants in the second action without breaching the implied undertaking rule:
[20] The email was affixed to an affidavit in support of an application to compel Mr. Baker, in his capacity as a plaintiff in the First Action, to furnish a further and better supplemental affidavit of records as part of the discovery process. Again, no one suggests the email was entered into the court file for an improper or collateral purpose. Once filed, the email was accessible by the public, absent a court order, and could be used by the defendants in other litigation, including the Second Action. No breach of the undertaking occurred. As such, the chambers judge was correct in determining that no foundation for civil contempt was established.
In assessing costs, the Court of Appeal noted that the appeal was motivated by the Applicants desire to police the Rules of Court, and there was no practical benefit to the litigation by bringing the Appeal. There was some indication that the application was retaliatory, and the Court noted there was no basis to include the Defendant’s lawyer in the application. The Court noted that litigation misconduct can result in enhanced costs and concluded that in this case enhanced costs were warranted at $10,000.