Renfrew Insurance Ltd. v. Donald, 2012 ABQB 228

Court of Queen ’ s Bench of Alberta Citation: Renfrew Insurance Ltd. v. Donald, 2012 ABQB 228 Date: 20120405 Docket: 1101 06215 Registry: Calgary Between: Renfrew Insurance Ltd. Plaintiff - and - Ann Donald, Ashley Farris, Sabrina Thornton, and BFL Canada Insurance Services Inc. Defendants _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice W. A.

Tilleman _______________________________________________________ Introduction [ 1 ] According to counsel, this case is argued to be a case of first impression in 150 years; a case that despite its interlocutory nature will affect all employer-employee relationships, and one that will have an immediate impact on the parties. [ 2 ] The present applications were brought in the context of case management and form part and parcel of a larger action in which both parties seek relief for damages incurred in relation to a bitter employment dispute. The Plaintiff seeks to amend its Statement of Claim.

The Defendants apply to strike certain portions of the Affidavit filed by the Plaintiff in support of their application.

Background [ 3 ] The individual Defendants, Ms. Ann Donald, Ms. Ashley Farris, and Ms. Sabrina Thornton were formerly employed by the Plaintiff, Renfrew Insurance Ltd. (“Renfrew”). Ms. Donald held a senior position at Renfrew. Her daughters, Ms. Farris and Ms. Thornton worked on her team.

The fourth Defendant, BFL Canada Insurance Services Inc. (“BFL”) is the Defendants’ current employer. [ 4 ] On April 14, 2011, all three individual Defendants terminated their employment with Renfrew and immediately commenced work with BFL. [ 5 ] Renfrew claims that the Defendants did so without advance notice and in violation of their employment and post- employment non-competition, non-solicitation, and confidentiality obligations to Renfrew. [ 6 ] The Defendants deny the Plaintiff’s allegations and claim damages as a result of constructive dismissal, defamation, interference with economic relations, and unpaid vacation and business expenses. [ 7 ] Though my decision is situated within this larger action, it deals solely with the two procedural applications and does not purport in any way to address the merits of the trial proper.

Facts [ 8 ] During questioning of Ms. Donald, Renfrew was informed that BFL agreed to indemnify Ms. Donald for any legal fees incurred by her or damages levied against her for actions taken by Renfrew as a result of Ms. Donald’s departure and subsequent employment with BFL (the “Indemnity Agreement”). [ 9 ] Renfrew claims that the Indemnity Agreement induced, and continues to induce, Ms. Donald to breach her employment and post-employment obligations to Renfrew, causing it harm.

It asks to amend its Statement of Claim to seek a permanent injunction restraining BFL from indemnifying the individual Defendants for any legal costs or damages incurred by the Defendants as a result of their wrongful conduct. [ 10 ] There is no indication that BFL signed a similar Indemnity Agreement with Ms. Farris or Ms. Thornton; however, Renfrew proposes that they be included in the amendment in the event that evidence of such agreements is later tendered. [ 11 ] In support of their application to amend, Renfrew relies upon the Affidavit of Mr.

Royer, the Chief Financial Officer of Renfrew, filed on August 3, 2011. [ 12 ] The Defendants oppose Renfrew’s application to amend and apply to strike certain portions of Mr. Royer’s Affidavit on grounds of impropriety. Issues

(1) Whether all or any of paras. 4 and 9 through 12, of Mr. Royer ’s Affidavit filed on August 3, 2011 in support of the Plaintiff ’s Application to Amend should be struck?

(2) Whether Renfrew has met the test to amend its Statement of Claim ? [ 13 ] As the outcome of the Defendant’s application to strike will impact the evidence relied upon in the Plaintiff’s application to amend, I will deal first with the application to strike before assessing the merits of the amendment application.

(1) Whether all or any of paras. 4 and 9 through 12, of Mr. Royer ’s Affidavit should be struck? The Law [ 14 ] Principles regarding the content of Affidavits under the old Rules of Court [1] were well-established.

Affidavit evidence should be confined to evidence, not argument or opinion. [2] While information based on belief was accepted in interlocutory matters (where the source of the belief was identified), Affidavits filed in support of final matters had to be based solely on the personal knowledge of the affiant. [3] [ 15 ] In applying these principles, Courts afforded affiants some flexibility when the context demanded. In Alberta Treasury Branches v. Leahy [4] , the Honourable Justice Mason considered the purpose of Affidavit evidence and the lens through which it should be considered.

He wrote: The purpose of affidavit evidence is to place the necessary facts before the court and should not contain argument, opinions or conclusions...I would emphasize, however, that assertions of fact may well need to be placed in an explanatory or narrative context in order to assist the court in understanding the relevance of a particular fact and the relationship between facts. This is not improper in my view. [ 16 ] At present, the proper content of Affidavits is addressed in rules 13.18 and 3.68 of the Rules of Court . [5] [ 17 ] Rule 13.18 states that:

(1) An Affidavit may be sworn: (

a) on the basis of personal knowledge, or (

b) on the basis of information known to the person swearing the Affidavit and that person’s belief.

(2) If an Affidavit is sworn on the basis of information and belief, the source of the information must be disclosed in the Affidavit.

(3) If an Affidavit is used in support of an application that may dispose of all or part of a claim, the Affidavit must be sworn on the basis of the personal knowledge of the person swearing the Affidavit. [ 18 ] Pursuant to Rule 3.68(4)(

a) a Court may: (

a) strike out all or part of an Affidavit that contains frivolous, irrelevant or improper information...

[ 19 ] The Defendants submit that Barker v. Budget Rent-A-Car of Edmonton Ltd. [6] , a recent case of the Alberta Court of Queen’s Bench, stands for the principle that old case law dealing with the predecessor rules carries over and should be considered in interpreting Rules 13.18 and 3.68. Although the wording of the new Rules differs slightly from its predecessors, I agree that prior case law is instructive.

For the circumstances of this application, the principles regarding proper Affidavit evidence remain unchanged - interlocutory Affidavits should not contain argument or opinion and where sworn on the basis of belief, must disclose the source of the belief. Mr. Royer ’s Affidavit [ 20 ] The impugned paras. read: 9.

It is my belief that the Indemnity Agreement induced and continues to induce Donald to breach the terms of the Insurance Producer's Agreement, the Unanimous Shareholder's Agreement, the Employee/ Office Manual and her fiduciary and common law duties and obligations including a duty of utmost good faith, a duty of loyalty, a duty of confidentiality, a duty to avoid conflicts of interest, a duty not to use Renfrew confidential information for her own or a competitor's benefit or to the detriment of Renfrew, and a duty not to solicit customers of Renfrew.

If the Indemnity Agreement is found to be valid and is enforced, Donald will not bear the financial consequences of her wrongful conduct. 10. I believe that if Donald does not bear the financial consequences of her wrongful acts, Donald in effect will benefit from her wrongful acts and would be able to evade any penalties imposed on her by a court of law for such wrongful acts. 11.

The breaches of the terms of the agreements and duties listed in para. 9 have caused and will cause Renfrew considerable harm including further solicitation of Renfrew's clients and employees, and further use of Renfrew's confidential information to the benefit of Donald or BFL or to the detriment of Renfrew. 12. It is my belief that the Indemnity Agreement is contrary to the public or moral interest in that it encourages fiduciaries, parties to contracts, and former employees to unlawfully breach their obligations. [ 21 ] By way of footnote to their brief, the Defendants also contest the propriety of para. 4.

It reads: 4. As part of this record production, the Defendants provided a copy of an Indemnity Agreement between the Defendants Ann Donald ("Donald") and BFL Canada Insurance Services Inc. ("BFL") where BFL agreed to indemnify Donald for the legal fees that she may incur and damages that may be levied against her in an action taken against her by Renfrew arising out of her employment with BFL. A copy of the Indemnity Agreement is attached hereto as Exhibit "1". [ 22 ] Para. 8 of Mr. Royer’s Affidavit, which the Plaintiff relies on in its defence, reads: 8.

When questioned further about the Indemnity Agreement, Donald made the following admissions: (

a) Mr. John Wright of BFL provided her with the Indemnity Agreement on or about March 17, 2011 before she terminated her employment with Renfrew. A copy of the transcript including this admission is attached hereto as Exhibit “3". (

b) Both Donald and BFL were concerned about a lawsuit if Donald’s clients followed her when she left Renfrew. A copy of the transcript including this admission is attached hereto as Exhibit “3".

(

c) After the Indemnity Agreement was in place, Donald left it up to BFL to deal with the consequences of Donald leaving Renfrew. A copy of the transcript including this admission is attached hereto as Exhibit “4". (

d) After BFL reviewed the Insurance Producer’s Agreement and the Unanimous Shareholder’s Agreement and obtaining legal advice on these documents, BFL offered to employ Donald instead of buying her book of business. A copy of the transcript including this admission is included in Exhibit “4". Parties ’ Positions Defendants [ 23 ] The Defendants argue that paras. 9 through 12 should be struck and should not be relied upon by this Court because they are improper. They contest para. 9 on the grounds that it contains opinion and unsupported belief on a legal issue. Para. 10 contains Mr.

Royer’s opinion as to what he believes the Court’s findings should be. Para. 11 is opinion evidence laundered through the guise of evidence and has no bearing on the amendment application. Para. 12 should be struck because it is nothing more than a statement of belief based on opinion. [ 24 ] The Defendants’ brief provides limited reasons as to its claim to strike para. 4; however, in oral argument the Defendants submitted that the para. should be struck as it contains a legal opinion. Plaintiff [ 25 ] Renfrew submits that there is nothing improper with the impugned paras.

Paras. 9, 10, and 12 comply with Rule 13.18 as the sources of Mr. Royer’s beliefs are disclosed in para. 4. [ 26 ] With respect to allegations of opinion evidence, Renfrew admits that para. 9 contains Mr. Royer’s opinion but relies on Royal Bank v. W. Got & Associates Electric Ltd. [7] for the proposition that opinion evidence is admissible if it is based on facts as perceived by the witness and is helpful in assisting the trier of fact in determining an issue. Renfrew also claims that Mr. Royer’s statement provides a narrative context for the facts and that case law suggests that this is not inappropriate.

Finally, Renfrew argues that the Court can remedy any impropriety by attributing the appropriate weight to para. 9. [ 27 ] Renfrew claims that para. 10 is proper as it merely provides an explanatory or narrative context of Renfrew’s concern that an Indemnity Agreement has been provided to Ms. Donald. It also claims that the Defendants put Mr. Royer’s opinion with respect to “punishment” in issue during questioning and they cannot now complain that his opinion is improper on this basis. [ 28 ] Para. 11 is an assertion of fact that supports the irreparable harm element of the test for an injunction.

It is not hearsay or opinion but is rather a proper fact and is necessary to provide the Court with an explanation and context as to why Renfrew seeks to amend its Statement of Claim. [ 29 ] Renfrew admits that if the amendment application were granted, it would be up to the Court to determine whether the Indemnity Agreement is contrary to public policy.

However, it claims that para. 12 sets out Renfrew’s belief, based on information included in para. 8 of the Affidavit. [ 30 ] While Renfrew points out that the Defendants gave notice of their argument with respect to para. 4 for the first time in a footnote on the last p. of their Brief of Argument, Renfrew does not claim that the Court should not consider the Defendants’ claim on this point. Instead, Renfrew rebuts the Defendants’ claim with respect to para. 4 on the basis that para. 4 is factual and appropriate.

Analysis [ 31 ] As I find that Mr. Royer’s Affidavit arises in the context of an interlocutory motion, there is no requirement that the Affidavit be stated on personal knowledge alone. [8] And when the case involves a corporate defendant, I keep in mind that corporations need a representative to speak; it has no other voice. That said, the representative needs to have disclosable knowledge and information about which he attests. [ 32 ] For the reasons that follow, I find that the last sentence of para. 9 and all of paras. 10 and 12 of Mr. Royer’s Affidavit contain opinion evidence and should be struck.

Paras. 4 and 11 are not improper and should remain. Para. 9 [ 33 ] While para. 9 is mostly set out in the language of belief, its content beginning with the last sentence is conclusory opinion. [ 34 ] Renfrew admits that para. 9 includes Mr. Royer’s opinion; however, it claims that the evidence is admissible as: (1) it is an opinion based on the facts (as perceived by Mr. Royer) and (2) his opinion is helpful to the judge in the determining the issues. In support of its position, the Plaintiff relies on Royal Bank v. W.

Got & Associates Electric Ltd. [9] With respect, I do not accept the Plaintiff’s application of Royal Bank . Royal Bank discusses the approach to lay opinions as follows: 15. Therefore if any of Mr. Howard's evidence, to which objection was taken, consists of opinion that was based on facts perceived by him and if his opinion is helpful to me as the trier of fact in determining an issue, it is admissible. 16. In fact, however, in the case of all the items of evidence I have referred to, his opinion was not based on facts perceived by him. [ 35 ] McDonald J. went on to say: 17.

However, in my view that does not require me to decide that the evidence of his opinion is inadmissible. The classical approach, and the modern rationale, of the law relating to the admissibility of nonexpert opinion evidence is based on the assumption that the purpose for which the evidence of opinion is proffered is to prove that a certain event occurred or a certain condition or state of affairs existed. That will be the typical situation. But this is not that case.

In this case the purpose of tendering the opinion evidence is not to show that it would have cost $X to complete a project or that if completed the project would or would not have been profitable. Rather, the purpose of tendering the evidence is to show that the receiver took certain steps to obtain qualified assistance and decided upon his course of action on the basis of that assistance and the information and advice generated by it.

From the facts which may thus be inferred counsel for the receiver will argue that the conduct of the receiver met the standards required by law. [ 36 ] In other words, the important step is to analyse the purpose for which the opinion is tendered. The analytical framework is very fact-specific. And while it does demonstrate that there is no absolute inadmissibility to lay opinions, admitting them would be characterized as exceptional and unusual as it will be rare for a lay person’s opinion to be of any interest to a trial judge. [ 37 ] In 1199918 Alberta Ltd. v.

TRL Holdings Inc. , [10] the Honourable Justice Graesser wrote: ...It is an error for a judge to accept inadmissible evidence, and if the evidence is critical to the application, acceptance may be a basis for reversal.

[ 38 ] Further, legal opinion evidence of a non-expert witness in Affidavit form is inadmissible. [11] Para. 9 ends with Mr. Royer’s opinion as to whether Ms. Donald has breached her contractual, fiduciary, and common law duties. These are issues for the Court to decide. [ 39 ] I acknowledge Renfrew’s argument regarding weight; nevertheless, attributing minimal weight to Affidavit evidence that clearly goes against established Rules of Court is not the proper remedy. For these reasons, and in particular, since the last sentence of para. 9 is conclusory argument, and speculative, it should be struck from Mr.

Royer’s Affidavit. Para. 12 [ 40 ] Para. 12 contains Mr. Royer’s opinion as to the impact of this case on public policy and fiduciary, contractual, and employment relationships (as opposed to his own industry, which would have been more helpful). Whether the Indemnity Agreement is contrary to public policy is a legal question for the Court to decide. Para. 12 is also generalized and speculative. It should be struck. Para. 4 [ 41 ] Para. 4 contains factual information as to the Indemnity Agreement. I see no basis for the Defendants’ argument that para. 4 contains opinion evidence. While Mr.

Royer provides a brief description of the document, he does not purport to interpret the Agreement. Para. 4 is factual and appropriate and should stay. Para. 10 [ 42 ] The Defendants argue that para. 10 is improper as it contains Mr. Royer’s opinion as to what he believes the Court’s findings should be. I agree. It also is conclusory argument and speculative and otherwise not helpful. It should be struck. Para. 11 [ 43 ] Para. 11 contains evidence as to the manner in which the alleged breaches have harmed and will, if not otherwise dealt with, continue to harm Renfrew.

As the Chief Financial Officer of Renfrew, Mr. Royer would have personal knowledge of the manner in which the alleged breaches impact the company. The evidence is relevant to Renfrew’s issues including the proposed injunction application and falls within the ambit of Rule 13.18(1)(a). [ 44 ] In

summary, for the reasons listed above, the Defendants’ application to strike paras. 4 and 11 is dismissed. Their application to strike the last sentence of para. 9, and all of paras. 10, and 12, is granted.

(2) Whether Renfrew has met the test to amend its Statement of Claim ? The Law [ 45 ] Rule 3.65(1) of the Rules of Court states that a party must receive the permission of the Court to amend its pleadings: 3.65(1) Subject to subrule (5), before or after close of pleadings, the Court may give permission to amend a pleading.

[ 46 ] In Hunter Financial Group Ltd. v. Maritime Life Assurance Co. , [12] the Alberta Court of Queen’s Bench found that an amendment should be allowed if: (

a) It can be made without prejudice or injustice to the opposing party, other than prejudice or injustice compensable with costs; (

b) It raises a triable issue; (

c) It is not embarrassing; (

d) It is pled with particularity; and (

e) There is some evidence to support any new facts of substance alleged. [ 47 ] The Court has broad discretion to grant an amendment. [13] Parties ’ Positions The Plaintiff [ 48 ] While Renfrew seeks to amend various portions of its pleadings, the Defendants only take issue with Renfrew’s claim for a permanent injunction and related prayer for relief. The amendment would give Renfrew the opportunity to seek a permanent injunction barring any agreement by BFL to indemnify the individual Defendants for legal costs and damages incurred as a result of violating their restrictive covenant agreement(

s) with Renfrew. It would read: The indemnity provided by BFL to Donald induced Donald to breach her Insurance Producer’s Agreement as stated herein, and is contrary to public policy.

Renfrew states that it is entitled to an injunction setting aside the indemnity provided by BFL to Donald and an Order directing that BFL shall not indemnify Donald, Farris or Thornton, directly or indirectly, for any legal costs or damages incurred by any of them as a result of the wrongful conduct set out herein or as a result of their employment with BFL. [ 49 ] Renfrew claims that the test for amending pleadings in Hunter Financial Group Ltd. is met. The amendment is not embarrassing, is pled with particularity, and the Indemnity Agreement is sufficient evidence to support the allegation.

The only remaining issues are parts (

a) and (

b) of the Hunter Financial Group Ltd. Test - whether there is a triable issue and whether the amendment can be made without prejudice or injustice to the Defendants. Renfrew submits that neither issue should bar the amendment. [ 50 ] Renfrew argues that there is a triable issue as the Indemnity Agreement induced and continues to induce Ms. Donald to breach her obligations.

As a contract designed to commit the tort of inducing breach of contract, the Indemnity Agreement should be deemed unenforceable at law and a permanent injunction should be granted preventing the individual Defendants from relying on the Agreement. [ 51 ] There is no prejudice to the Defendants as Renfrew is not stipulating that the individual Defendants obtain separate counsel or specifying the manner in which payment ought to be divided; they are merely suggesting that opposing counsel keep track of time separately so as to better facilitate the division of costs should such an order later be granted.

There is no evidence of any real prejudice or injustice.

The Defendants [ 52 ] The Defendants agree that the test set out in Hunter Financial Group Ltd. is the appropriate test for an amendment but submit that the amendment is hopeless, obviously invalid and should be refused. [14] They claim that there is no triable issue as the matter is one of public policy. Not only is there no legally valid objection to the Indemnity Agreement, they argue public policy militates in favour of prohibiting the amendment. In addition, the amendment would cause prejudice to the Defendants by driving a wedge between the Defendants and their counsel.

Analysis [ 53 ] I agree with the parties that the two points at issue are: (1) whether there is a triable issue and (2) whether the amendment can be made without prejudice or injustice to the opposing party, other than prejudice or injustice compensable with costs. I accept that Renfrew has met the remaining parts of the Hunter Financial Group Ltd. test on the basis that the proposed amendment is not embarrassing, is pled with particularity, and the Indemnity Agreement is sufficient evidence to support the substance alleged. [ 54 ] While there is no evidence of an Indemnity Agreement between Ms. Farris or Ms.

Thornton and BFL, there is no evidence it does not exist and thus I find that the Indemnity Agreement between Ms. Donald and BFL along with other indica indicating that Ms. Farris and Ms. Thornton may have left Renfrew with their mother and accepted employment at BFL under similar conditions as Ms. Donald, is sufficient.

(1) Whether there is a triable issue? [ 55 ] A triable issue is one that gives rise to a claim recognized in law. As stated in Hunter Financial Group Ltd. , there is a low threshold to establish a triable issue. [15] Even an amendment that raises a doubtful plea should be allowed as long as it is arguable. [16] Amendments can be allowed even with delay or prejudice as long as the delay is not undue.

And in the case of prejudice, the amendment can be added as long as it is not clearly prejudicial to the opposing party, meaning no prejudice that could not be compensated with costs. [ 56 ] The dynamics of this case are complex. On its face, there is a triable issue as to whether BFL’s Indemnity Agreement induced Ms. Donald to breach her obligations to Renfrew. Case law supports the contention that one cannot contract to commit a tort. In Brown Jenkinson & Co Ltd. v. Percy Dalton (London) Ltd. [17] the Court found that any agreement to indemnify a party for the commission of the tort of deceit is unenforceable.

In WH Smith and Son v. Clinton [18] , the Court refused to enforce an indemnity agreement in which the Defendant agreed to indemnify the Plaintiff against publishing libel. The Courts have also considered inducing breach of contract in the employment context. In Harrington v. Victoria Graving Dock Co. [19] applied in Crabb v.

Ellis [20] , the Court wrote: ...when a bribe is given, or a promise of a bribe is made to a person in the employ of another by someone who has contracted, or is about to contract, with the employer, with a view to inducing the person employed to act otherwise than with loyalty and fidelity to his employer, the agreement is a corrupt one and is not enforceable at law... [ 57 ] Though the Defendants did not specifically address the issue of unlawful agreements and inducing breach of contract, they maintain that a valid and overriding public policy reason is absolutely essential before the court will refuse to enforce a valid and applicable contract. [21] They claim that the mere granting of this amendment will have an effect that will reverberate beyond this lawsuit by calling into question the freedom to contract and restraint on trade. [ 58 ] Without deciding this public policy issue, I note that public policy considerations are not a part of the Hunter Financial Group Ltd. test to amend and have no bearing on the decision of whether to grant an amendment.

While public policy may, in certain circumstances, be considered in evaluating whether there is a triable issue, I am not convinced that the Defendants’ public policy argument negates the triable issue in this case. Given case law on the unenforceability of contracts where a tort is found, it is likely that the trial court will be tasked with balancing public policy considerations on both sides with established jurisprudence on the tort of

inducing breach of contract. That task is for the trial judge. [ 59 ] Moreover, I am not convinced that an interlocutory order allowing this amendment will have the broad-reaching impact described by the Defendants. A pleading is a pleading. It is the originating document on which the Court and the parties rely to characterize the claims and understand the scope of the issues. [22] It is not a final decision on the merits of the case. In Kent v. Martin [23] , the Court wrote: What happens at trial happens at trial.

This is the pleading stage and I say this to point out that pleadings are not evidence. (See Rule 13.6(2)). ... It characterizes the claims between them, tells the court with broadness what the issues are; and it gives notice to the Defendants of what is to be defended. That is all a pleading does. [ 60 ] Beyond public policy considerations, the Defendants also claim that Renfrew does not have standing to contest the Agreement and that there is no authority for doing so. They claim that the three cases cited above ( Brown Jenkinson & Co Ltd. v. Percy Dalton (London) Ltd . ; WH Smith and Son v.

Clinton ; and Harrington v. Victoria Graving Dock Co . ) involve contractual disputes as between the parties to the contract, not a third party. While the cases establish that unlawful contracts are unenforceable at law, privity of contract raises an issue as to whether Renfrew, who is not a party to the Indemnity Agreement, has standing to contest its enforceability. [ 61 ] In response, Renfrew relies on Wanderers Hockey Club v. Johnson [24] , a case which it claims involves a third party dispute. In Wanderers , the Plaintiff, a rival hockey club, offered the Defendant more money to play for them.

Johnson agreed without telling his current team. When Johnson failed to play for the Plaintiff, it sued. The Court held that a contract is unenforceable at law where it is obvious to both parties that it cannot be carried out without the breach of an existing contract by one of the parties. [ 62 ] While Wanderers involves three parties, the actual dispute is between the parties to the contract. Here, the conflict is between the Defendants (parties to the Indemnity Agreement) and Renfrew, a non-party seeking to contest its enforceability with its former employees.

Given this distinction, I do not accept Wanderers as authority for Renfrew’s standing to question the agreement. [ 63 ] That said, while I question the probity of Wanderers , I do not agree with the Defendants that the issue of standing should absolutely bar the amendment. The threshold for a triable issue is low. At the very least, there is an arguable issue as to whether such standing exists. [ 64 ] This application is interim and procedural in nature.

Whether Renfrew will succeed in meeting the test for a permanent injunction is an issue to be left for trial and one that requires far more evidence than what can be considered within the scope of this application. While the threshold for granting a permanent injunction is high, there is a triable issue as to whether such remedy is appropriate.

(2) Whether the amendment can be made without prejudice or injustice to the opposing party, other than prejudice or injustice compensable with costs? [ 65 ] An amendment ought not be allowed where it would cause undue prejudice or undue injustice to the opposing party, other than prejudice or injustice compensable with costs. [ 66 ] Renfrew submits that there is no prejudice in allowing the amendment. While the amendment would require the Defendants to divide costs amongst themselves, Renfrew is not asking that the Defendants obtain separate counsel; they are simply asking that at some point the individual Defendants bear the financial responsibility for their alleged wrongs.

[ 67 ] While Renfrew suggested that counsel keep track of time separately, it says that it did so merely as a practical suggestion to assist the Defendants in dividing costs should the injunction be granted. Renfrew notes that lawyers commonly divide their fees between clients and that this means of accounting is not only practical, it is commonplace. [ 68 ] The Defendants argue that the proposed amendment is not feasible as it would be nearly impossible to apportion costs as between each Defendant.

They also maintain that while Renfrew does not explicitly ask that the Defendants obtain separate counsel, the amendment could have the effect of forcing the Defendants to do so by driving a wedge between the Defendants. In support of this point, they submit that the amendment will divide the Defendants conceptually and will introduce friction where there was none. The Defendants will no longer be on the same page as to how to prosecute and defend the claims. [ 69 ] I do not find any prejudice that could not be compensable with costs.

As argued by Renfrew, lawyers commonly apportion costs as between various clients. I do not consider the added effort to keep track of time separately or appropriately apportion accounting after trial as prejudice. While I understand that the amendment may cause the Defendants to approach the case with some other considerations including financial perhaps, this too is not the type of prejudice that should stand in the way of amending pleadings.

Again, it is not uncommon for friction to exist between Defendants, if that is the case here. [ 70 ] I find that Renfrew has met the test to amend its pleadings, and I have no concern about the relative timeliness of it, and therefore make an Order allowing it to do so. Conclusion [ 71 ] To be clear, this is an interim ruling on a procedural matter, not to be construed as to affect the merits of the parties’ positions or the trial proper.

In other words, while I make the necessary Orders regarding the striking of improper paras. as well as an Order permitting Renfrew’s proposed amendments, I have made no findings as to the ultimate merits. Rather, I have only looked at the current factual situation in the context of a motions application. [ 72 ] Regarding costs, if the parties are unable to agree, they may make an application before me to speak to the matter. Heard on the 9 th day of February, 2012. Dated at the City of Calgary, Alberta this 5 th day of April, 2012. W. A. Tilleman J.C.Q.B.A. Appearances: Grant Stapon, Q.C. and Kelsey J.

Drozdowski Bennett Jones LLP

for the Plaintiff Kelly Nicholson and Steve Eichler Field LLP for the Defendants [1] Alberta Rules of Court, Alta Reg 390/68. [2] Karpow v. Go Vacation Canada Ltd. (1994), (AB KB), 154 AR 303 at paras. 11 & 12. [3] Banff Transportation & Tours Inc. v. Buchan, 2002 ABQB 423 at para. 11. [4] (1999), 1999 ABQB 185 , 234 AR 201 at para. 84 (QB). [5] Alberta Rules of Court, Alta Reg 124/2010. [6] 2011 ABQB 123. [7] (1993), (AB KB), 142 AR 188, 10 Alta.

LR (3d) 440 at para. 15 (QB). [8] Alberta Rules of Court, Alta Reg 124/2010, s. 13.18. [9] Royal Bank, supra note 7. [10] 2011 ABQB 506 at para. 40. [11] See Ford Credit Canada Ltd. v. Unger & Champion Realty Ltd., [1982] AWLD 276 where the Court struck a para. in an Affidavitfor giving a legal opinion where the para. spoke to the legal authority of a director of a corporation to execute an agreement. [12] 2007 ABQB 263 at paras. 9-12; other case citations omitted. [13] Ignition Energy Ltd. v. Direct Energy Marketing, 2011 ABQB 90 at paras. 9-11. [14] Mason Insultation Products Ltd. v.

Crossroads C & I Distributors, 2011 ABQB 51 at para. 45. [15] Hunter, supra note 12 at para.13. [16] Balm v. 3512061 Canada Ltd., 2003 ABCA 98 at para. 12. [17] [1957] 2 QB 621(Eng CA). [18] [1908] 99 LT 840 (KB). [19] (1878), 3 QB 549 at 551. [20] 2009 CarswellOnt 1826 at para. 75-76 (ONSC). [21] Tercon Contractors Ltd. v. British Columbia (Minister of Transportation & Highways), 2010 SCC 4, [2010] 1 SCR 69. [22] Zavitz Technology Inc. v. 146732 Canada Ltd., (1991) 49 CPC (2d) 26 (Ont Gen Div). [23] 2011 ABQB 416 at para. 17. [24] (MB KB), [1913] 5 WWR 117 (BCSC).