Security National Insurance Company, represented by Associate Noah Hodgson, brought an Application to dismiss the insured's claim pursuant to Rule 4.31 and Rule 4.33 of the Alberta Rules of Court. On June 22, 2020, Judge S.L. Corbett issued a written decision denying the application under Rule 4.33, but granting the application under Rule 4.31 thereby dismissing the insured's claim for inordinate and inexcusable litigation delay.
The decision is unique and has significant implications for litigation in the Provincial Court of Alberta since there has been limited judicial consideration of Rule 4.31 in the context of this court. Namely, this decision re-iterates the Provincial Court of Alberta's purpose: “expeditious and inexpensive resolution of a matter before the Court” and relies heavily on this purpose in dismissing the Action for inordinate and inexcusable delay. Actions in the Provincial Court of Alberta that are several years old may be subject to a successful Application for dismissal pursuant to Rule 4.31.
While the Provincial Court of Alberta generally guides litigation in scheduling pre-trial conferences and trial dates, meaning that litigation generally proceeds quickly, there are times where pre-trial conferences and trials are not scheduled when both parties are represented by counsel and there are times when pre-trial conferences and trial dates are cancelled making litigation delay a real issue in Provincial Court.
In this matter, the Plaintiff was the insured of Security National Insurance Company. He made a claim in 2014 under his standard SPF 1 motor vehicle policy for damage caused to his vehicle. He alleged that the damage was caused by ice and was therefore, a covered loss under the SPF1. The insurer, Security National Insurance Company, claimed the damage was caused by maintenance issues. As such, the insured denied coverage in late 2014 for the loss.
On November 24, 2015, the Plaintiff filed his Civil Claim and served it in November 2016. The insurer promptly filed its Dispute Note and no steps had been taken since that date other than some cursory document exchange in 2018 and 2019.
As is “par for the course” in drop dead application, the first portion of the Application dealt with Rule 4.33. The main dispute was whether the document disclosure that occurred in 2018 and 2019 could be considered to have materially advanced the Action. The Court found that the document disclosure that occurred in 2018 – the Plaintiff's document disclosure – did not materially advance the action because the documents were either irrelevant or had been previously produced prior to the litigation commencing. However, the Court found that the Defendant's document disclosure did materially advance the Action because the Defendant provided an appraisal from the initial denial of the claim, which the Court considered to be a new and relevant document to the issues in the Action.
As such, Security National Insurance Company's application under Rule 4.33 failed since the document exchange that occurred in 2019 materially advanced the Action.
The Court relied heavily on the recent case of Transamerica Life Canada v Oakwood Associates Advisory Group Ltd, 2019 ABCA 276 in determining the Application under Rule 4.31 of the Alberta Rules of Court and applied the following general framework:
- Has there been delay and is the delay inordinate?
- Is the delay inexcusable / is there a good explanation for the delay?
- Has prejudice been demonstrated?
Firstly, the Court found that there was clearly a delay since the Action was filed in 2015 and had not proceeded to a pre-trial conference or trial by the date of filing the Application – March 2020. The Court found the delay to be inordinate having regard to the mandate of the Provincial Court of Alberta: expeditious and inexpensive resolution of a matter before the Court and the nature of the Action itself.
Second, the Court found the delay to be inexcusable as the Plaintiff was unable to proffer a good excuse for the delay in prosecuting the Action. The Plaintiff provided several excuses, but the Court found them to either be inadmissible, irrelevant or generally did not provide a credible excuse for the delay.
Finally, with respect to the issue of prejudice, the Court acknowledge the rebuttable presumption of prejudice that arises when an inordinate delay is found. This presumption was not rebutted by the Plaintiff.
Ultimately, based on this analysis, the Court dismissed the Action pursuant to Rule 4.31
The Hearsay Issue
This Action also provides litigants with a reminder to be careful when filing Assistant-sworn Affidavits for use at an Application. Judge S.L. Corbett was highly critical of the Plaintiff's responding Affidavit because it was sworn by his legal assistant and contained significant allegations in an attempt to defeat the Application. Specifically, the Plaintiff attempted to show that the Defendant contributed to the delay through sworn evidence of his legal assistant. The Court found that all of this evidence was inadmissible because it did not meet the necessity and reliability test for admission of hearsay evidence. For the evidence to be accepted, the Court indicated that it would have required evidence about why the Plaintiff could not swear his own Affidavit and it was unclear what steps the legal assistant had in observing the Defendant's alleged delay.
A copy of the written decision of Justice S.L. Corbett can be found here:
Originally published 09 July, 2020
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