Weins v. Dewald, 2011 ABQB 400

Court of Queen ’ s Bench of Alberta Citation: Weins v. Dewald, 2011 ABQB 400 Date: 20010624 Docket: 0401 11316 Registry: Calgary Between: George Wiens, Susan Wiens, and Wye-Knott Millennium Carriers Ltd. Plaintiffs - and - Jim Dewald and Wye-Knott Holdings Ltd. Defendants _______________________________________________________ Reasons for Judgment of K.R.

Laycock, Master in Chambers _______________________________________________________ [ 1 ] The plaintiffs are applying for a procedural order pursuant to rule 4.4(2) and the defendants have applied for an order striking the claim for long-delayed pursuant to rule 4.31 and 4.33.

Rule 4.33 provides that a court must dismiss an action when delay longer that 2 years (modified to 5 years by the bridging provision in rule 15.4) has elapsed, subject to conditions that do not apply to this case. [ 2 ] This proceeding involves an accounting between parties for transactions to a joint venture that operated between February 2002 and September 2003. The statement of claim was filed October 30, 2003 and the statement defence was filed August 20, 2004. A demand for particulars was filed December 15, 2003 and responded to on April 20, 2004.

The plaintiffs affidavit of records was filed January 10, 2005 and the defendants affidavit of records filed April 8, 2005.

[ 3 ] Anna Kim deposes that an examination for discovery of George Wiens was held April 25, 2006. She further deposes that on October 9, 2009 a without prejudice offer of settlement was forwarded to the defendants’ lawyers but no reply was received. [ 4 ] Anna Kim further deposes that she served the defendants’ lawyer with a proposed litigation plan on April 8, 2011 which proposes that questioning on answers to undertakings be completed by August 30, 2011; dispute resolution is not required pursuant to rule 15.3; and, the parties request the Court Clerk to

schedule a date for trial before October 30, 2011 pursuant to rule 8.4. Anna Kim further deposes that she did not receive a response to the proposed litigation plan and therefore on April 19, 2009 she swore her affidavit and prepared an application with a hearing date of April 21, 2011. The parties agreed that the application be set over to May 18, 2011 and that “such delay by adjournment would not be used to dismiss the action pursuant to Rule 4.33 (1)(

a) of the Alberta Rules of Court”. [ 5 ] The defendants filed their cross application on May 10, 2011, supported by an affidavit from Mr. Dewald. He deposes that his examination for discovery and that of the plaintiff Wiens took place on April 25 th 2006. He states that settlement correspondence was exchanged by counsel in 2007, 2008 and 2009, but no settlement was reached. He states that after receiving the proposed litigation plan and the plaintiffs motion he spoke to his lawyer on or about April 20, 2011 with respect to the litigation plan.

He could not recall whether undertakings were given at discovery and instructed counsel to order transcripts. [ 6 ] On April 20, 2011 the defendants’ lawyer wrote to the plaintiffs’ lawyer confirming that they did not have copies of the transcripts, a record of undertakings, or a record of having received any undertakings from the plaintiff.

He could not agree to a litigation plan without the transcripts to help them more clearly determine the status of the action. [ 7 ] The transcripts of the examination for discovery disclosed that the defendant had given four undertakings and taken two other requests under advisement. The plaintiff had given four undertakings. There is no evidence that the undertakings were ever supplied by either party.

Litigation Plan [ 8 ] The plaintiffs refers to the following rules with respect to litigation planning. 4.4(1) Unless the parties otherwise agree, or the Court otherwise orders, and subject to matters arising beyond the control of the parties, the parties to an action categorized as a standard case must, within a reasonable period of time considering the nature of the action, complete each of the following steps or stages in the action: (

a) close of pleadings; (

b) disclosure of information under

Part 5 [ Disclosure of Information]; (

c) at least one of the dispute resolution process is described in rule 4.16(1), and less the requirement is waived by the Court; (

d) application for trial date. 4.4(2) A party to an action categorized as a standard case may serve on the other party a proposed litigation plan or a proposal for the completion or timing of any stage or step in the action, and if no agreement is reached, any party may apply to the Court for a procedural or other order respecting the plan or proposal.

[9] The parties agree that this is a standard case referred to in rule 4.4(1). Rule 4.4 (1) requires the parties to prepare a litigationplan. A completed litigation plan is therefore a procedural step required by the Rules of Court. According to Alberta v. Morasch 2000ABQB 24 , 2000ABQB 24,completion of a procedural step required by the rules will always be a thing that materially advancesthe action. [10] Merely proposing a litigation plan is not something that would have materially advanced this action. As the court said inAlberta v.

Morasch at para. 13, merely setting a date for an examination for discovery, by itself, probably does not materially advance inaction. See also Nelson v. Emsland, 2007 ABQB 571, 427 A.R. 427 and Haekel v. Canada, 2008 ABQB 701. [11] The defendant argues that the first item of the litigation plan proposed by the plaintiff, agreeing to an end date to completequestioning on answers to undertakings, probably would not materially advance this action.

The completion of the questioning onanswers to undertakings would have materially advance the action. [12] The defendant further argues that the second item in the proposed litigation plan merely confirms the existence of rule 15.3which confirms that where discoveries have been completed under the former rules, dispute resolution is not a requirement. Confirmingthe effect of this rule would not have advanced this action. [13] The third item in the litigation plan requires the parties to complete Form 37 and request a trial date from the court clerkbefore October 30, 2011.

The only thing that the parties must do before completing a Form 37 is the delivery of undertakings andcompletion of any questioning on undertakings. The completion of a certificate of readiness by the plaintiff under the old rules was not athing that materially advance the action: Morasch at para. 7. Agreeing to set a matter for trial on completion of undertakings would notmaterially advance an action: see Lanset Capital Corp. V. Waterloo Geological Consulting Ltd., 2006 ABCA 77.

However, thecompletion and filing of a certificate of readiness, under the former rules, or a Form 37, under the new rules, would have materiallyadvanced the action because a procedural step required by the rules would have been completed. [14] The defendant argues that merely agreeing to request a trial date from the court clerk before October 30, 2011 would not havematerially advanced this action.

The completion of a litigation plan pursuant to rule 4.4(2) would be a permitted step in a proceeding andthe completion of such a plan may have the effect of materially advancing an action, particularly an action that has stalled. [15] If I should grant a procedural order in accordance with plaintiff’s proposed litigation plan, such an order, granted pursuant torule 4.4(2) must be considered to materially advance this action. [16] One of the principal goals of the rules is to encourage the parties to resolve their claims fairly and justly in a timely and cost-effective manner (rule 1.2(1)).

In order to achieve this goal Part Four makes it the responsibility of the parties to manage their dispute ina timely and cost-effective way (rule 4.1). Rule 4.2(

b) makes it the responsibility of the parties to respond in a substantial way and withina reasonable time to any proposal for the conduct of an action in a standard case. [17] The plaintiffs argue that the defendants did not respond within a reasonable period of time to their proposal for the completionof discovery and entry of the matter for trial.

The defendants argue that a reasonable time had not passed for them to consider theplaintiff’s proposal for the completion of steps necessary to proceed to trial. [18] The defendants argue that they had insufficient knowledge to respond, up to April 21, 2011 because they did not knowwhether undertakings had been given and if so whether further questioning was necessary on answers to the undertakings.

Since they didnot receive the transcripts from the examination for discovery until sometime in May, they argue that they could not respond to thelitigation plan and further that the Court would not have granted a procedural order on April 21, 2011. [19] The defendants argue that it would have made no sense for the court to have directed a procedural order which includedquestioning on answers to undertakings, if no undertakings had been given. I disagree.

Given the delay in bringing the matter to trial, buthaving regard to the fact that the plaintiff had not abandoned this action, as evidenced by their three separate settlement proposals, Iwould have granted a procedural order. I would have granted a procedural order on April 21, 2011 directing questioning on undertakings,if any, and required the parties to complete Form 37 and file it with the court clerk in the very near future. I would consider a provision inthe procedural order to strike the action if the plaintiff did not comply with the timing in the order.

[ 20 ] Such a procedural order would have been that thing that materially advance the action. Therefore the prerequisites to rule 4.33 have not been met and I would not dismiss this action. Rule 4.31 Delay [ 21 ] Rule 4.31 states: If delay occurs in an action, on application the Court may (

a) dismiss all or any part of the claimant if the Court is satisfied that the delay has resulted in significant prejudice to a party, or (

b) make a procedural order or any other order provided for by these rules. [ 22 ] As an alternative, counsel for the defendant asks for dismissal for delay pursuant to rule 4.31, the successor to rule 244(1). The former rule contained a presumption that delay caused prejudice.

The new rule does not and accordingly the defendant acknowledges that it must provide evidence of prejudice, along with inordinate and inexcusable delay. [ 23 ] The defendant argues that the passage of almost 5 years since the examination for discovery means that there is very long delay and that there is no evidence from the plaintiff that such delay is excusable.

I am satisfied that there is inordinate delay in prosecuting this file and there is no evidence whatsoever from the plaintiff attempting to excuse the delay. [ 24 ] The defendant deposes in his affidavit that he has stopped carrying on operations of the corporate defendants, and he has no contact with any of his former employees who could be witnesses. As a result he states that his ability to defend himself is seriously prejudice. [ 25 ] The defendant does not state that any of his financial or corporate records are missing.

He does not provide any evidence as to which employees would be witnesses and whether he has taken steps to locate them. There is no evidence that the documents required to answer his undertakings are lost or unavailable. [ 26 ] This lawsuit is about an accounting between parties to a joint business venture and the accounting for income and expenses between the parties. I cannot conclude that there is sufficient evidence to satisfy me that there is significant prejudice to be suffered by the defendants in the continuation of this action. In Durnin v.

Snider , 2011 ABQB 383 , Master Hanebury considered an application pursuant to the former rule 244 (1) and allowed an action to proceed where documentation formed the foundation of the lawsuit. [ 27 ] I am satisfied that the plaintiff is entitled to a procedural order pursuant to rule 4.4 (2) and rule 4.31(

b) that requires both parties to provide answers to undertakings within 30 days of the entry of this order and any questioning on answers to undertaking to be completed within 30 days thereafter. The plaintiff shall prepare, and provide to the defendant, Form 37 on or before September 30, 2011, and the defendant shall complete and sign the form and return it to counsel for the plaintiff on or before October 14, 2011. The plaintiff shall submit Form 37 to the court clerk and request a trial date on or before October 21, 2011. [ 28 ] Costs and default provisions may be spoken to by the parties.

Heard on the 18 th day of May, 2011. Dated at the City of Calgary, Alberta this 24 th day of June, 2011. K.R. Laycock M.C.C.Q.B.A. Appearances: Anna S. Kim Venture Law Group LLP for the Plaintiffs Katrina Edgerton-Mcghan Scott Venturo LLP for the Defendants