Nova Pole International Inc v Permasteel Construction Ltd, 2017 ABQB 521

Court of Queen’s Bench of Alberta Citation: Nova Pole International Inc v Permasteel Construction Ltd, 2017 ABQB 521 Date: 20170828 Docket: 0403 11139, 0403 11138 Registry: Edmonton Docket: 0403 11139 Between: Nova Pole International Inc Plaintiff - and - Permasteel Construction Ltd Defendant - and - RND Engineering

(1997) Ltd Third Party And Between: Docket: 0403 11138 Nova Pole International Inc Plaintiff - and - Trans America Group Ltd and Parkland Industrial Estates Ltd Defendants - and - 406747 Alberta Ltd formerly Sonex Construction and AECOM Canada Ltd formerly UMA Engineering Ltd Third Party

_______________________________________________________ Reasons for Decision of W.S. Schlosser , Master, Court of Queen's Bench of Alberta _______________________________________________________ [ 1 ] This is a 4.33 with a 4.31 in aid. [ 2 ] The lawsuits (there are two) are just over 12 years old. The two actions have proceeded side-by-side. [ 3 ] In the Permasteel action, Nova Pole entered into a design-build contract with the Defendant. The Defendant contracted with the Third Party to do the design.

Nova Pole alleges that there are design shortcomings rendering the facility almost unusable. [ 4 ] In the Trans America action, Nova Pole purchased land from Trans America and Parkland in 2001 to build a facility to manufacture steel poles. The Defendants were obliged to prepare the site for construction and deal with drainage issues. [ 5 ] The main issues in both lawsuits appear to be about damages. Expert evidence will be central to this determination. [ 6 ] The Plaintiffs argue that difficulty obtaining expert opinion evidence is responsible for much of the delay in this action.

Now expert reports have been obtained and they have been circulated to the parties. The Plaintiffs say that all that remains is to set this matter for trial, though I expect that there will be further examination required. [ 7 ] A detailed chronology is attached as a

schedule to these Reasons. List of Authorities 1. Flock v Flock Estate , 2017 ABCA 67 ; 2. Humphreys v Trebilcock , 2017 ABCA 116 ; 3. Canada (Attorney General) v Delorme , 2016 ABCA 168 ; 4. Ravvin Holdings Ltd v Ghitter , 2008 ABCA 208 . And by the Court 1. 1406998 Alberta Ltd v Dorbandt , 2017 ABQB 321 2. Mintage Financial Corp v Altenhofen , 2013 ABQB 486 ; 3. R v Jordan, 2016 SCC 27 ; 4. Hamill v Kudryk, 2013 ABCA 37 . Analysis Rule 4.33 [ 8 ] The Plaintiff argues that there are three events constituting a significant advance such that there is not a three year gap in the progress of this action: 1.

Provision of an expert report conditionally; which could not be used because it was prepared by someone who ultimately joined Plaintiff’s counsel’s office. 2. An answer to an undertaking September 6, 2013. The question was whether Trans Am group had been billed for certain work. The answer was that the invoicing records had been destroyed. 3. An Order directing that the actions be tried concurrently by the same judge. [ 9 ] The Court is to apply a functional analysis to see if the event constitutes a significant advance ( Flock ). [ 10 ] There are a variety of ways to approach this question.

One way is to ask whether the event brought the matter significantly to trial, or resolution. Another is to ask whether the event significantly helps determine one of the issues in the lawsuit ( 1406998 Alberta Ltd v Dorbandt ). A further option is to ask whether the event accomplishes one of the goals set out in rule 1.2, which might or might not be enough.

[ 11 ] The provision of the expert report and the answer to the undertaking September 6, 2013, are, in my respectful view, non- starters (notwithstanding Ravvin at paras 24, 25 with respect to the undertaking answer). [ 12 ] The Order directing that the trials be heard concurrently, however, is another matter. [ 13 ] In September 2014, the Plaintiff took out an application to consolidate the actions. The application was contested, so it was set for Special Chambers to be heard in March 2015.

The parties agreed they would not count the time between the motion and the special Chambers date. [ 14 ] In February 2015, the Defendants indicated that they would agree to an Order directing that the actions be tried concurrently and, on March 5, 2015, a Consent Order was obtained giving that direction. [ 15 ] I acknowledge that this was, in fact, the way that the parties had been treating the lawsuits informally. However, the Order directing this constituted a significant advance. Consolidation of the actions may not have been obtained, but concurrent trials accomplishes the goals of rules 1.2(2)(

b) and (3)(d). In other words, the Order helps facilitate the quickest means of resolving the claims at the least expense and it uses the publicly funded court resources effectively and efficiently. It also avoids the possibility of inconsistent results in these closely linked actions. [ 16 ] I acknowledge that concurrent trials, or consolidation, might, in some fact scenarios, represent a step backwards, rather than an advance if a slower action is linked and one action is put on hold for the other to catch up; somewhat like hitching a snail to a turtle.

But in this case the actions have proceeded at the same (slow) speed. [ 17 ] The parties agreed that the time between the application and the Special Chambers hearing should be of no account for the purposes of a 4.33 application. So the timing of the motion and the subsequent Order constituted a significant advance before the three years was up. [ 18 ] The rule 4.33 application is dismissed. Rule 4.31 [ 19 ] The leading case is Humphreys v Trebilcock . [ 20 ] In the most general terms, the Court is to consider whether the delay is inordinate and inexcusable in the context of the litigation.

Some types of action require a quicker pace owing to the nature of the allegations, or other factors; such as if land is tied up, and this can affect the determination of whether the delay is inordinate (eg Mintage ). It may also go to the issue of prejudice. The 10 year cap created by the Limitations Act might pose a useful ‘best-before’ date. [ 21 ] If there is a particular instance of prejudice claimed to have arisen from the delay, it is important to ask whose fault the delay was.

If you lose your witness while you are delaying the action, for example, you can hardly blame the other side. [ 22 ] Furthermore, when calculating the overall length of delay, a Jordan -type analysis is useful. However, in a civil setting, institutional delay should not necessarily be counted against the Plaintiff; for example, the delay in having a motion heard (or waiting for a reserved decision).

I acknowledge that taking out an application will not, without more, act as a stay but, for practical purposes it may mean that very little else happens in the action while the parties wait for the date for their motion to be heard. [ 23 ] The Court of Appeal in Humphreys directs us to answer six distinct questions in a rule 4.31 determination. [151] First, has the nonmoving party failed to advance the action to the point on the litigation spectrum that a litigant acting reasonably would have attained within the time frame under review? [152] Second, is the shortfall or differential of such a magnitude to qualify as inordinate? [153] Third, if the delay is inordinate has the nonmoving party provided an explanation for the delay?

If so, does it justify inordinate delay? [154] Fourth, if the delay is inordinate and inexcusable, has this delay impaired a sufficiently important interest of the moving party so as to justify overriding the nonmoving party’s interest in having its action adjudged by the court?[96] Has the moving party demonstrated significant prejudice? [155] Fifth, if the moving party relies on the presumption of significant prejudice created by r. 4.31(2), has the nonmoving party rebutted the presumption of significant prejudice? [156] Sixth, if the moving party has met the criteria for granting relief under r. 4.31(1), is there a compelling reason not to dismiss the nonmoving party’s action? 97 This question must be posed because of the verb “may” in r. 4.31(1). 98 [ 24 ] Approximately four years plus of the delay (in the 2011 – 2016 time-frame) could be attributed to the Plaintiff’s delay in obtaining a useable expert report, coupled with the Defendant’s wish to have expert reports before completing or concluding their examinations. [ 25 ] I note that the parties were not finally settled until 2010.

Trebilcock Answers

[ 26 ] Answers to the questions posed in Trebilcock are, as I see them: 1. The Plaintiff has failed to advance the action to a point on the litigation spectrum that could reasonably have been attained by now; 2. The shortfall is inordinate; 3. The Plaintiff has provided an explanation but it does not justify inordinate delay; 4. The moving party has not demonstrated significant prejudice; 5.

There is a presumption of prejudice on the facts. [ 27 ] In Ravvin , the Court of Appeal held: [38] Evidence sufficient to raise a legitimate doubt as to the existence of a likelihood of serious prejudice may take many forms, such as prior discovery evidence or affidavit evidence filed by the parties on the application to strike. It may also come from allegations of actual prejudice submitted by the applicant, or it may simply arise naturally from the existence of certain facts.

Once there is evidence sufficient to raise a legitimate doubt as to whether prejudice does in fact exist, the presumption alone is not sufficient to meet the applicant’s burden of proving prejudice. [ 28 ] This is primarily a ‘documents case’ not a ‘memories case’. To be more specific, it is a case in which expert opinion evidence occupies the central, pivotal point in this lawsuit. [ 29 ] The Plaintiff has now produced an expert report and indicates the matter that is virtually ready for trial (unlike Humphreys ).

I am satisfied, at least to the level of a legitimate doubt, that the presumption has been rebutted; though narrowly. [ 30 ] In other circumstances I would impose a deadline on the Plaintiff to complete and circulate their expert reports but this has already been done and what remains is for the Defendants and Third Parties to complete and produce theirs.

In the circumstances, I am not willing to limit the time for them to do this with a procedural Order. [ 31 ] Where the delay is long, though not quite long enough to strike out an action and a procedural Order is not appropriate, an Order for security for costs may provide a sufficient incentive for a Plaintiff to keep the matter moving on the principle of Hamill v Kudrick (‘a wholesome practice’), but this should be claimed by the applicant as a fall-back position and argued at the application. Disposition [ 32 ] The applications are dismissed, though with costs in the cause.

Heard on the 24 th day of July, 2017. Dated at the City of Edmonton, Alberta this 28 th day of August, 2017. W.S. Schlosser M.C.Q.B.A. Appearances: Donald R. Cranston, Q.C. Bennett Jones for the Plaintiff, Nova Pole International Inc Donald S. Dean

Dean Duckett Carlson LLP for the Defendant, Permasteel Construction Ltd Doreen Saunderson Field Law for the Defendants, Trans America Group Ltd and Parkland Industrial Estates Ltd Kyle Harder and Taryn Burnett Gowling WLG for the Third Party, AECOM Canada Ltd formerly UMA Engineering Ltd

Schedule A The

Schedule is omitted from unofficial electronic version of the judgment. It is included with the official filed version of the judgment.