Carter v. Sears Canada Inc., 2011 ABQB 732

Court of Queen ’ s Bench of Alberta Citation: Carter v. Sears Canada Inc., 2011 ABQB 732 Date: 20111125 Docket: 0301 13465 Registry: Calgary Between: Glen Carter Plaintiff - and - Sears Canada Inc. Defendant _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice R. J.

Hall _______________________________________________________ [ 1 ] This is an appeal from the Order of the learned Master pronounced April 6, 2011, dismissing the Plaintiff’s Statement of Claim for long delay pursuant to Rule 4.33 and 15.4 of the Alberta Rules of Court . [ 2 ] The Plaintiff, Glen Carter (“Carter”) was employed by the Defendant Sears Canada Inc. (“Sears”) as a part-time sales associate at the Chinook Mall in Calgary, Alberta from April 2000 to July 2001.

Carter filed a Statement of Claim against Sears on August 26, 2003 founded on an “actionable breach of confidentiality” alleging that an idea submitted by Carter to Sears in an employee suggestion box constituted intellectual property which was disclosed to and used by an unnamed third party for profit. The claim also alleges negligence, constructive dismissal and eligibility for Sears profit sharing stock options.

[ 3 ] The Statement of Claim was served by registered mail sent from London, England to Sears’ head office in Toronto, Ontario. The Statement of Claim did not provide an address for service in Alberta as required by Rule 5(1)(

b) of the old Alberta Rules of Court , and was served out of Province without obtaining an Order for Service Ex Juris as required by Rule 30 and 31 of the old Alberta Rules of Court . The Statement of Claim provided an address for service in London, England, and an international telephone number. [ 4 ] Notwithstanding the defects in respect of the Statement of Claim, Sears filed a Statement of Defence on September 19, 2003.

On October 3, 2003, the Statement of Defence was served via registered mail to Carter’s address in London, England as provided on the Statement of Claim; however, it appears that the address used in service was to an address in “London N & ORN”, whereas the Statement of Claim set forth an address for service at “London N7 ORN”. The Statement of Defence was picked up and signed for by an individual “K. Munro”. The Plaintiff, however, says he does not know “K. Munro”, and that he never received it.

Indeed, the Plaintiff admits in his Affidavit in Support of his Appeal that he moved from the address provided on the Statement of Claim around the first week of September, 2003 and was unable to have his mail redirected to his new address. [ 5 ] Given that the Plaintiff had no address for service, Sears sought and obtained an Order on January 20, 2004 from Master Floyd which stayed the action until Carter provided a proper address for service and which postponed the deadline for Sears to file its Affidavit of Records until the stay was lifted. [ 6 ] On February 24, 2004, Carter corresponded with Sears and provided an email address as well as a new mailing address in London, England.

Sears’ counsel in Calgary emailed Mr. Carter advising that he should direct all future correspondence to her and that the court action had been stayed pending Carter’s provision of an Alberta address for service, and that Carter should engage an Alberta lawyer to assist him. On March 16, 2004 Ms. Robson mailed copies of the Statement of Defence and the Order staying the action to Carter via registered mail. Carter has confirmed that he received the March 16, 2004 correspondence.

Indeed, he provided the original documentation to the learned Master for her review at the time that this matter proceeded before the Master on April 6, 2011. [ 7 ] The Defendant received no further communication from Carter until November 26, 2006 when Carter emailed Ms. Robson and advised that he had returned to Alberta but could not proceed with his Statement of Claim because he did not have access to his copies of the legal papers. Carter did not provide an address for service in Alberta as required by the 2004 Stay Order. Ms.

Robson nevertheless responded by email on November 28, 2006 advising Carter once again of the 2004 Stay Order and that he should contact a lawyer. He was further advised that he could obtain copies of the court documents by contacting the Court. [ 8 ] The Defendant received no further communication from Carter until March 15, 2011 when Carter emailed Ms. Robson advising that he wanted to arrange a meeting concerning the action. Ms.

Robson replied by email on March 17, 2011 advising Carter that the action had been stayed in 2004 and that because he had taken no steps in more than 7 years, the action was likely to be dismissed by the Court. He was again advised to seek legal advice and assistance. [ 9 ] Carter finally provided an address for service in Alberta via email on March 17, 2011. [ 10 ] Immediately upon receiving Carter’s address for service, Sears filed an application to have Carter’s action dismissed for long delay. [ 11 ] Sears attempted service of the application at the address provided by Carter in his email on March 17, 2011.

The Affidavit of Attempted Service indicates that the address provided by Carter was the Mustard Seed. The process server was advised by an employee of the Mustard Seed that Carter did not work at the location and would not confirm whether Carter resided at the address for privacy reasons. The process server left a business card with the employee and asked that Carter contact him. Carter contacted the process server via email and was advised in response to make arrangements for service of documents from Sears.

Further attempts to serve the Application were unsuccessful and Carter made no further contact with the process server prior to the process server swearing the Affidavit of Attempted Service. [ 12 ] The Application was heard on April 5, 2011 before the learned Master. Carter was not present for the Application and the learned Master granted an Order dismissing the claim on the basis of submissions made by counsel for Sears. An Order was to be drafted and provided to the learned Master for execution.

[ 13 ] Prior to the submission of the draft Order for the learned Master’s execution, Carter advised the Court that he had been at the courthouse on April 5, 2011 but had attended the wrong courtroom. The learned Master directed that the Application be heard again in Carter’s presence on April 6, 2011. [ 14 ] On April 6, 2011, after hearing submissions from both parties, the same Master granted the Order sought by Sears in the Application and dismissed the action for long delay. [ 15 ] On April 13, 2011 Carter filed a Notice of Appeal of the learned Master’s Order returnable May 12, 2011.

On May 12, 2011 the parties appeared before Mr. Justice Poelman in respect of the appeal. Mr. Justice Poelman ordered that the appeal be scheduled to be heard in Special Chambers. This matter came before me, pursuant to that Order, on the afternoon of November 1, 2011. LAW [ 16 ] The relevant rule for the appeal of a Master’s order is Rule 6.14 of the Alberta Rules of Court which provides, inter alia , that such appeals are on the Record of Proceedings before the Master and, if the judge permits, may also be based on new evidence that is significant enough that it could have affected the Master’s decision.

The Record of Proceedings consist of the Application and Supporting Affidavits in evidence, the transcript of proceedings before the Master and the Order at issue, as well as any written reasons given by the Master. All of those materials have been placed before me. No application was made to place new evidence before me, and no new evidence was before me, and this appeal is an Appeal based on the Record of Proceedings before the Master. [ 17 ] The applicable standard of review in respect of factual determination and questions of mixed fact and law is reasonableness.

The applicable standard of review on a question of law is correctness. [ 18 ] The Order at issue in this appeal was granted pursuant to Rules 4.33 and 15.4. Rule 15.4(1)(

b) is a bridging provision and provides that the Court must dismiss the action if either five years or two years since November 1, 2010, whichever is earlier, has elapsed since the last thing done to significantly advance the action. [ 19 ] Rule 4.33 is a departure from the old Alberta Rules of Court . Pursuant to the old Rule 244.1(1) the Court was required to dismiss the action if 5 years had elapsed since the last thing done to significantly advance the action. Rule 4.33 will shorten that period to two years; however, in this case, two years have not elapsed since Rule 4.33 came into effect. Accordingly, and pursuant to Rule 15.4(1) (

b) the applicable period is five years since the last thing done to significantly advance the action. [ 20 ] Reference must also be had to Rule 15.4(2)(

b) which provides:

(2) The Court must not dismiss the action if (

b) the action has been stayed or adjourned by Order, an Order has extended the time for doing the next thing in the action or the delay is provided for in the litigation plan. [ 21 ] The Plaintiff argues that is incumbent on both parties to move an action forward. He maintains that Rule 4.33 is not in effect, as less than two years have passed since that Rule came into effect. He argues that the Defendant at all times had the wherewithal to contact him notwithstanding the defect in his action, and that the Defendant bore a responsibility to move the matter forward as did the Plaintiff.

He maintains that, initially, he had no address in Calgary that he could use as an address for service; he maintains that, in 2006 he advised counsel that he was unable to access court documents and therefore unable to proceed at that time; he argues that he had too many other matters to address in his life to take the step of providing an address for service earlier than he did.

He argues that the Defendant cannot rely on Rule 4.31 to dismiss this claim, as the learned Master did not decide on the basis of Rule 4.31. [ 22 ] Most importantly, he argues that this is a stayed proceeding, and as such the provisions of Rule 15.4(2)(

b) are applicable, and

[ 22 ] Most importantly, he argues that this is a stayed proceeding, and as such the provisions of Rule 15.4(2)(

b) are applicable, and the Court must not dismiss the action because the action has been stayed. [ 23 ] For six years of the seven year delay, the new Rules were not in effect. That is to say, under the regime of the old Rules, more than five years had passed without the Plaintiff taking any further steps to advance the action other than filing and serving it on Sears. While the Plaintiff did write to Sears on November 26, 2006, he did not materially advance the action at that time. He simply wrote: Further to your email of March 16, 2004, I have now returned to Canada and to the Province of Alberta.

I was hoping to proceed with my application against your client after my arrival on May 11, 2006.

However, due to personal circumstances beyond my control I do not have access to my copies of the legal papers to this action. [ 24 ] The authorities are clear that sending such correspondence does not materially advance the action and does not qualify as a step in the action. [ 25 ] Hence, more than five years had expired from the time the action was filed and served until the change in the Alberta Rules of Court effective November 1, 2010. [ 26 ] The new Rules have carried forward the five year “drop dead” Rule until November 1, 2012, when the requisite period of inactivity will be shortened to two years under Rule 4.33.

It was appropriate for the Defendant to apply for an Order of Dismissal pursuant to Rule 4.33 and Rule 15.4 of the new Rules. The Defendant’s application, before the Master, in the alternative, was to strike the claim due to prejudice arising from the long delay, pursuant to Rule 4.31. [ 27 ] Subject to what I have to say about Stayed Proceedings, therefore, the Defendant could have made this application before the new Rules came into effect, and would have been successful because of the mandatory nature of the previous Rule 244.1(1).

That right to apply has not been lost by the Defendant as a result of the coming into force of the new Rules, because of the provisions of Rule 15.4. [ 28 ] Under the old Rules, there was no requirement for the Defendant to take any steps to assist the Plaintiff in prosecuting this action; the obligation was solely left to the party making the claim. [ 29 ] Mr. Carter argues that the foundational Rules now contained in

Part 1 of the Rules of Court have changed that obligation, compelling the parties to jointly and individually move the action forward in a fair and just manner and in a timely and cost effective way. He argues, under this regime, therefore, that the Defendant had an obligation to move the matter forward just as the Plaintiff does. [ 30 ] I do not accept that to be the intention of the new Rules of Court . The specific obligations of each party are set out therein, and each party must meet those specific obligations.

However, when it comes to prosecuting a claim, the ultimate responsibility still remains with the party making the claim to ensure that it moves forward in such a manner that Rules 4.33 and 15.4 are not violated. The Plaintiff has failed to meet that seminal obligation in this case, either under the old Rules or the new. [ 31 ] The Plaintiff argued the case of Jondreau v. McLean and Eide

(2006) ABQB 265. In that case Master Hanebury refused to dismiss an action where, following the passage of five years delay the parties had then continued on to take steps in the law suit. Master Hanebury noted that, in that case, the Defendants, apparently unilaterally, decided to file a Statement of Defence seven years after the filing of the Statement of Claim, sought to organize discoveries, demanded an Affidavit of Production and filed a motion to compel production, all before bringing an application to strike the pleadings under the old Rule 244.1. Citing Trout Lake Store Inc. v. Canadian Imperial Bank of Commerce

(2003) ABCA 25, Master Hanebury determined that the party bringing the application may lose his right to dismissal of the action if it has, outside the five year window, gone along with actions taken by the Plaintiff and failed to bring the application expeditiously; and indeed in taking steps itself after the five year period had passed. [ 32 ] The reasoning in that decision is in fact now encapsuled in the new Rules of Court , in Rule 4.33(1)(

d) which is an exception to the requirement of the Court to dismiss the action where 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.

[33] Here no such steps have been taken by the Defendant Sears. Once Sears was provided with an address for service for thePlaintiff in Alberta, Sears moved forward to bring this application. [34] Accordingly, it is clear that the learned Master appreciated the applicable law in granting her decision and in dismissing theaction for want of prosecution pursuant to Rules 4.33 and 15.4 of the Rules of Court; indeed, she is compelled to do so as the provisionsin those Rules and in the previous Rule 244.1 make it mandatory for the Court to do so.

The learned Master’s decision on this point iscorrect; where based upon facts or mixed facts and law, her decision was reasonable and should not be disturbed.

That is to say, either ona reasonableness or a correctness standard, the learned Master’s decision is to be upheld. [35] All of this, however, must be then looked at in relation to the provisions of Rule 4.33(1)(b), given that the action has beenstayed by order. [36] The issue before the Court is whether the stay in this case nullifies the application of Rules 4.33 and 15.4; has the Stay in thisaction stopped the clock from running during the currency of the Stay? [37] The learned Master considered this argument in her decision.

At page 34, lines 25 to 35 as follows: I do not believe that the Stay that was issued in this case is the type of Stay that is contemplated in the Rules to avoid a mandatorydismissal for a long delay. Surely a Stay that is issued by the Court to ensure that a plaintiff who has filed a non-compliant pleading andhas not provided an address for service to protect the defendant from having to face penalties for not filing the Affidavits of Records in atimely fashion, surely that is not the type of Stay is contemplated by the Rule.

The whole point of the Rule is to encourage expeditiouslitigation and to interpret the Rule in the way that you would suggest would be inconsistent and contrary to not only the Rule, but to thefoundational rules, which essentially are a codification of this practice of common law in this jurisdiction, that we need to see that justiceis done in an efficient, practicable way in the most timely and cost effective way as possible. After some quarrelling with that decision by the Plaintiff, the Master returned to the issue at page 36, lines 37 to 41 and stated as follows: I did, sir.

And what I had said was that there was a Stay put in place and I discussed the nature of the Stay that was granted and that thatwas surely not the type of Stay that was contemplated in the long delay rules as a block to a mandatory dismissal for long delay. [38] Whether subrule (

b) to Rule 4.33(1) bars the mandatory dismissal for long delay is a pure question of law. As such, thestandard of review is correctness. [39] The Plaintiff argues applicability of Can. Sys. GRP (Est) v. Allendale Mutual Insurance Company (Ontario), (ON SC), [1982] 137 D.L.R. (3d) 287 as being supportive of his position that, where the action is stayed, the mandatory dismissalfor long delay cannot apply.

He says the Ontario High court Justice, in that case, granted a stay, then indicated that “Counsel for theApplicants and other parties must be diligent in moving to trial as quickly as possible.” He says that is authority for his proposition thatonce a stay has been granted, both parties have an obligation to move the case along. However, the cited case does not support thatprinciple. The court stayed one action so that other actions making a similar claim arising out of a single set of circumstances, couldcatch up and be heard together.

He was referring to the need for counsel to move along those other cases diligently, not the case whichhe had stayed. [40] Rule 15.4(2)(

b) is a new Rule. It makes perfect sense in the case where the Plaintiff, against whom dismissal for long delay issought, has been precluded from taking a step by virtue of a Stay of the Action by Order. In such a case the Plaintiff would be powerlessto end the delay by taking a step in the Action, and would be faced with a “Catch 22" situation. The Rule prevents such a conundrum. [41] Where, however, the Action has been stayed until the Plaintiff takes an identified step, such as providing an address for

service, as is the case here, the Plaintiff has the sole power to take that step and to move the matter forward. The Plaintiff also has the obligation to do so. Having failed to take that step, the Plaintiff cannot now hide behind the Stay and claim protection under Rule 15.4(2) (b). That cannot be the intention of the Rule.

It would be contrary to the purpose of the Rules of Court set out in Rule 1.2(1), to provide a means by which claims can be fairly and justly resolved in or by a court process in a timely and cost effective way. [ 42 ] Accordingly the decision of the learned Master wherein she dismissed the Action for long delay, is both reasonable and correct. The Appeal is dismissed. [ 43 ] The Defendant shall have costs of the Action and of this Appeal, from the Plaintiff, in Column 2 of

Schedule C of the Rules of Court . Heard on the 1st day of November, 2011 Dated at the City of Calgary, Alberta this 25th day of November, 2011. R. J. Hall J.C.Q.B.A. Appearances: Mr. Glen Carter Self-Represented Sharon E. Borgland, Borden Ladner Gervais for the Defendant