1490703 Alberta Ltd Plaintiff - v. -, 2021 ABQB 495

Court of Queen’s Bench of Alberta Citation: 1490703 Alberta Ltd v Chahal, 2021 ABQB 495 Date: 20210628 Docket: 1601 09247 Registry: Calgary Between: 1490703 Alberta Ltd Plaintiff - and - Raj H.S. Chahal, Novy Cheema, Murray D. MacKay, Murray MacKay Professional Corporation, Jason R. Ingimundson, Jason Ingimundson Professional Corporation, Harpreet Thiara, Francisco Ignacio, Sandeep Basra, Zafir Rashid, Zachery Penner, Randy Chan, Jane Doe, John Doe, ABC Corporation and XYZ Corporation Defendants _______________________________________________________ Reasons for Judgment of the Honourable Mr. Justice O.P.

Malik _______________________________________________________ I. Introduction [ 1 ] The Plaintiff appeals the decision of a Master reported at 1490703 Alberta Ltd v Chahal , 2020 ABQB 33 , which dismissed the Plaintiff’s application for

summary judgment against Novy Cheema, Murray D. MacKay and Murray MacKay Professional Corporation (the “MacKay Defendants”) and which granted the MacKay Defendants’ application for

summary dismissal of the Plaintiff’s action on the basis of limitations. [ 2 ] In her decision, the Master provided an extensive chronology of the facts. For the reasons that follow, I agree with the Master’s decision and I dismiss the Plaintiff’s appeal in its entirety. II. Standard of Review [ 3 ] An appeal from a Master’s decision is de novo and the standard of review is correctness ( Bahcheli v Yorkton Securities Inc. , 2012 ABCA 166 at para 12 ).

No deference is owed to a Master’s decision. [ 4 ] Where the appeal from the Master’s decision involves the same record and arguments, I may frame my reasons with reference to the Master’s decision where I agree with them ( HOOP Realty Inc v Emery Jamieson LLP , 2020 ABCA 159 at para 41 ).

III. Legal Test for

Summary Judgment [ 5 ]

Summary judgment may be granted where there is no genuine issue requiring a trial and where the court can reach a fair and just determination based on the evidence before it. The “no genuine issue” test should be assessed according to what is procedurally fair rather than by weighing the merits of the parties’ respective positions. A court is not precluded from granting

summary judgment in the face of contested facts or conflicting evidence. ( Hannam v Medicine Hat School District No. 76 , 2020 ABCA 343 at para 161 [ Hannam ]). [ 6 ]

Summary judgment is appropriate where the record allows the court to make the necessary findings of fact, apply the law to those facts, and arrive at a just result in an expeditious way ( Weir-Jones Technical Services Incorporated v Purolator Courier Ltd , 2019 ABCA 49 at para 47 [ Weir-Jones ]; Hannam at paras 145-161 ). [ 7 ] The burden rests on the moving party to show that there is no defence to the claim and that there is no genuine issue requiring trial. The moving party must prove the factual elements of the case on a balance of probabilities. If it cannot do so, its application fails.

The resisting party must demonstrate that the record, facts, and law preclude a fair, just, and final disposition. If a resisting party can prove that there is a genuine issue requiring trial, such as where there is a dispute on material facts or there are questions of credibility or evidentiary gaps, then

summary judgment should not be granted ( Weir Jones at para 35). [ 8 ] Finally, on an application for

summary judgment, each party must put its best foot forward. The focus is on the actual evidentiary record available to the judge rather than on speculation of what might “turn up in the future” or speculation about whether a party can produce a “better” record should the matter proceed to trial ( Weir-Jones at paras 37, 39 ). [ 9 ] In determining whether

summary judgment is appropriate in this case, I consider the following questions ( Weir-Jones at para 50 ):

a) Can I fairly resolve the dispute on a

summary basis notwithstanding the conflicting evidence before me?

b) Has the moving party satisfied me that there is “no defence” and that there is no genuine issue requiring trial?

c) Has the resisting party demonstrated that there is a genuine issue that requires a trial?

d) Does the state of the evidentiary record give me sufficient confidence that

summary disposition is appropriate in the circumstances? IV. The Facts [ 10 ] During oral argument, I asked the parties to identify which portion(

s) of the Master’s recitation of the facts they disagreed with. Counsel for the MacKay Defendants agreed with the Master’s factual findings. Apart from the Plaintiff’s disagreement with the Master’s characterization of the facts at paragraph 101 of her decision (I address this below), it appears that the facts are not in dispute. A. The Plaintiff Purchases the Land [ 11 ] In September 2009, April Ferguson and her mother incorporated the Plaintiff company for the purpose of pursuing real estate opportunities. Ms.

Ferguson deposes that she was inexperienced with the risk aspect of real estate transactions but understood that she needed to retain a lawyer’s services to “ensure transactional success”. [ 12 ] In early October 2009, Ms. Ferguson agreed to purchase certain lands on behalf of the Plaintiff, described as Phase 1, Lot 49, Windhorse Manor (the “Land”) from a developer (the “Developer”) for the sum of $315,000.00. On October 14, 2009, Ms. Ferguson signed an “Offer to Purchase Residential Lot(

s) Unregistered Plan” (the “Offer”) between the Plaintiff and the Developer. Clause 2 of the Offer, titled “Completion Date” stipulates that the “Purchaser agrees that clear title to [the Land] will be provided by May 31, 2009” (as the Master observed, the completion date was an error but otherwise has no bearing on the facts). [ 13 ] Ms. Ferguson paid the full purchase price of the Land to the Developer through an intermediary. While the intermediary happened to be a lawyer, the purchase funds did not pass through the intermediary’s trust account nor were they impressed with any trust conditions.

It does not appear to be disputed that Ms. Ferguson’s decisions to purchase the Land, execute the Offer, and provide payment to the Developer without the use of a lawyer’s trust account or trust conditions were made on her initiative alone, prior to her retaining the MacKay Defendants, and without having received legal advice from the MacKay Defendants. B. The Plaintiff Retains the MacKay Defendants [ 14 ] Ms. Ferguson says that on November 3, 2009, she called Mr. Cheema, a real estate lawyer practising at the Calgary law firm of MacKay & Cheema. Ms.

Ferguson was familiar with the firm as it was doing other real estate work for the Plaintiff. Ms. Ferguson states that she explained to Mr. Cheema that she had completed the Offer and that it would be faxed to his office “for the purpose of his retainer”. Ms. Ferguson says that she left a voicemail with Mr. Cheema on December 29, 2009, “to ascertain what progress had been made in the completion of the Lands purchase...” but that she did not hear back from him. It does not appear that Ms. Ferguson called Mr. Cheema back. [ 15 ] Mr. Cheema’s real estate paralegal, Ms.

Cindy Paquette, recounts that in early June 2010, the intermediary informed Ms. Paquette that he had referred Ms. Ferguson to Mr. Cheema regarding the Plaintiff’s Land purchase. The intermediary faxed Ms. Paquette a copy of the Offer.

[ 16 ] Ms. Paquette has a very specific recollection as to the terms on which she says Mr. Cheema was retained. She recalls that the she was contacted by Ms. Ferguson on June 15, 2010, “to confirm the exact nature of the retainer”. According to Ms. Paquette, the Plaintiff retained Mr. Cheema “for the limited purpose of registering a transfer of land” with respect to the Plaintiff’s Land purchase. Ms. Paquette says she made a note of their conversation which states: “request transfer only, [Ms. Ferguson] has paid lot in full. Just wants us to register transfer”. Ms. Paquette says Ms.

Ferguson informed her that “she would deal directly with the Developer in respect of the removal of encumbrances on the title.” [ 17 ] Ms. Paquette recalls a subsequent conversation with Ms. Ferguson after having obtained a title search for the Lands during which Ms. Paquette “advised [Ms. Ferguson] that the Developer’s mortgage remained on title”. According to Ms. Paquette, Ms. Ferguson “reiterated her instructions that we were just to register the transfer”. [ 18 ] Ms. Ferguson adamantly disagrees with Ms. Paquette’s version of events. Ms. Ferguson says that she did not speak with Ms.

Paquette on June 15, 2010, and has produced cell-phone records to support her contention. Ms. Ferguson says she only made two calls to the MacKay firm: on November 3 and on December 29, 2009. Ms.

Ferguson deposes: At no time did I ever suggest, request, or agree to a “limited retainer...” At no time did I discuss with anyone associated with [Mr.] Cheema or his office, or otherwise communicate with any such person respecting, a retainer, or even for that matter, the subject matter of the Plaintiff’s purchase of the Lands. ...My initial contact with [Mr.] Cheema concerning this matter occurred on November 3, 2009. [ 19 ] Mr. Cheema deposes that he was retained by the Plaintiff in mid-June 2010, “for the limited purpose of registering title” of the Land from the Developer to the Plaintiff.

He does not recall having any conversation with Ms. Ferguson. He understood that the terms of the retainer were that Ms. Ferguson would deal directly with the Developer to remove any encumbrances registered against the Land and that he was to “request the Developer remove such prior encumbrances given payment in full for the [Land]”. Mr. Cheema confirms that the title to the Land transferred to the Plaintiff in about February 2011, following which he provided the Plaintiff with his reporting letter dated March 4, 2011. C. Efforts to Obtain Clear Title to the Land [ 20 ] Ms.

Ferguson says that she sent a fax to Mr. Cheema on August 12, 2010, enclosing a copy of the Offer with the following covering message: I have attached a copy of purchase (portion) and a copy of the drafts and cheques of which were made payable to [the Developer]. Please call me if you have any questions. I haven’t had title since November 2009 and need to get title in order to do anything. Please advise. [ 21 ] Ms. Ferguson says she did not receive a reply from Mr. Cheema. [ 22 ] On December 21, 2010, the Developer’s lawyer sent Mr.

Cheema a fax confirming the terms of the Offer and that full payment from the Plaintiff for the Land had been received. The Developer’s lawyer concluded the letter by confirming that “[o]ur office will not be providing any undertakings with respect to such encumbrances as the clients have agreed to deal with this issue directly”. Mr. Cheema does not recall whether he confirmed with Ms. Ferguson that she would deal directly with the Developer with respect to the question of encumbrances. [ 23 ] Included with the fax was a Transfer of Land to Mr.

Cheema from the Developer’s lawyer sent under the trust condition that the Transfer of Land not be used prior to February 15, 2011. The fax also included a copy of a letter the Developer had sent to the Plaintiff dated December 10, 2010, undertaking to “provide [the Plaintiff] with clear title, excepting only permitted non-financial encumbrances, no later than 30 days from the day the Transfer of Land is registered”. [ 24 ] On March 4, 2011, Mr.

Cheema wrote a letter to the Plaintiff advising that title to the Land had been transferred to the Plaintiff and further advised that “title reflects that...a writ against the vendor has been registered on title and we suggest that you contact him to arrange to have it removed from your title forthwith.” [ 25 ] On June 22, 2011, Ms. Ferguson e-mailed Ms. Paquette, requesting her to “do me a favor” and find out if there was still a caveat registered on title to the Land. Ms. Paquette sent Ms.

Ferguson a copy of the title to the Lands which showed a mortgage registered in favour of First Calgary Savings & Credit Union Ltd (“First Calgary”) in the sum of over 17 million dollars. In her reply, Ms. Paquette indicated to Ms. Ferguson that: ...the vendor’s charges have not yet been removed. Harpreet Thiara...[Ms. Paquette provided Mr. Thiara’s phone number]...advised that he would remove all encumbrances within 30 days of his letter of December 10, 2010. The writ that was registered has been removed. [ 26 ] Ms. Ferguson acknowledges that she received a copy of the title to the Land from Ms.

Paquette and was aware of the First Calgary mortgage. On June 25, 2011, Ms. Ferguson replied that she would “make a phone call to [Mr.] Thiara and find out why the vendor’s charges have not yet been removed”. Ms. Paquette replied on June 27, 2011, stating that: “I have spoken with [Mr. Thiara] as well, he tells me he is working on it”. [ 27 ] Several days later, Ms. Ferguson replied to Ms. Paquette, saying she would contact the Developer and inquire why the

vendor’s charges had not yet been removed. Ms. Paquette responded, advising that as far as she knew, “[the Developer] is working on it”. What Ms. Ferguson understood from Ms. Paquette was that an effort was being made to provide the Plaintiff with clear title to the Land. Contrary to what she had told Ms. Paquette, Ms. Ferguson had not spoken with the Developer. [ 28 ] Ms. Ferguson deposes that by September 2011, she understood that the Land was subject to First Calgary’s mortgage. She was frustrated with the lack of communication from Mr.

Cheema and she expressed her frustration with what she perceived as the lack of progress in the following terms: It was my expectation that the [First Calgary] Mortgage would eventually be removed from title, yet that did not seem to be happening. Consequently, I took matters into my own hands and pursued contact with First Calgary directly, who put me in touch with the...First Calgary account manager in charge of the Windhorse Manor development. [ 29 ] On September 12, 2011, Ms. Ferguson spoke with First Calgary’s account manager and e-mailed him a copy of the title to the Land.

Her note of the conversation reads in part: I was also wanting to discuss the details of my lot purchase as I have a title that is showing a mortgage in over 10 million registered on our clear title lot which we purchased for $315,000. I told him that we are not sure why the lot has First Calgary Mortgage registered on it and wanted to get this cleared up. [ 30 ] The same day, Ms. Ferguson sent an e-mail to First Calgary’s account manager and to Mr. Cheema, noting: I’ve attach[ed] a copy of contact info in regards to the following lot that was purchase clear title, [Ms.

Paquette] handled transferring title and a current copy of the title was pulled and there is still a blanket mortgage from First Calgary on the title which is supposed to have been removed. [ 31 ] On September 13, 2011, Ms. Ferguson received an e-mail from First Calgary, asking to speak with her lawyer. Shortly thereafter, First Calgary’s account manager e-mailed Ms. Ferguson, asking her to provide a copy of the sales contract, proof as to the Plaintiff’s payment of the purchase price, and details surrounding the conditions of the sale of the Land. [ 32 ] The same day, Ms. Ferguson received an e-mail from Mr.

Cheema advising that she was “not allowed” to contact First Calgary’s account manager directly, that “neither will we”, and that she was to deal directly with a “Mr. Harpreet Thiara”. [ 33 ] Ms. Ferguson thought she had done something wrong by contacting First Calgary and she felt chastised by Mr. Cheema. Moreover, Ms. Ferguson did not know who Mr. Thiara was (unbeknownst to MS. Ferguson, Mr. Thiara worked for the Developer). On November, 26, 2011, She responded to Mr.

Cheema, expressing her “frustration and concern” with the fact that “this caveat was to be removed obviously because the lot was paid off” and explaining that she did not know who Mr. Thiara was. Ms. Ferguson asked Mr. Cheema, “I need to understand what my legal options are in this scenario. Do you know the seller?” [ 34 ] Mr. Cheema responded the next day: I will have to pull this file from storage and review all the documents to see. I do not know the sellers.

I was contacted by [their] representatives and informed that you and [Mr.] Thiara had agreed to resolve the caveat issue directly. [ 35 ] This appears to be the last time Ms. Ferguson had any contact with Mr. Cheema. [ 36 ] On October 18, 2011, Mr. Cheema sent a letter to the Developer’s lawyer with respect to the latter’s December 21, 2010, fax. Mr. Cheema requested that the encumbrances registered against title to the Land be removed immediately as per the undertaking the Developer had given the Plaintiff in its December 10, 2010, letter. D. The Plaintiff Retains Another Lawyer [ 37 ] In early 2012, Ms.

Ferguson retained the services of a lawyer, Mr. Ingimundson, for his “legal help to guide us in a direction to understand what was going on with [the Land]” and more specifically, to deal with the “issue of the persisting registration of the [First Calgary] Mortgage”. It was agreed that Mr. Ingimundson would directly negotiate with Mr. Thiara. Ms. Ferguson provided the lawyer with a copy of title to the Land and Mr. Cheema’s March 4, 2011, reporting letter. [ 38 ] In reviewing Messrs. Ingimundson and Thiara’s correspondence, it is apparent that by March 2012, Mr. Thiara was unable to provide any assurance to Mr.

Ingimundson that the Developer would receive enough money from the sale of lots to discharge First Calgary’s mortgage. In an e-mail to Mr. Ingimundson on March 12, 2012, Mr. Thiara advised that the Developer required another 60-90 days for outstanding lots to close, that this was a “worst case scenario” and that the Developer could not “guarantee” what the outcome of its meeting later that week with the bank to discharge the mortgage against the Land would be. [ 39 ] Mr.

Ingimundson was unsuccessful in discharging First Calgary’s mortgage and in being able to negotiate an additional lot as compensation for having to wait to clear off First Calgary’s mortgage. Ms. Ferguson was not pleased with the outcome of Mr. Ingimundson’s efforts as she felt that he could not provide a “cogent explanation” as to why First Calgary mortgage remained on the title to the Land. The Plaintiff terminated the lawyer’s retainer. E. The Plaintiff Obtains its Solicitor-Client File from the MacKay Defendants

[ 40 ] On February 25, 2013, Ms. Ferguson e-mailed Ms. Paquette, advising that: I have left a message for you and [Mr.] Mackay in regards to getting the relevant file from you... I have a lawyer that requires these documents and I would like to come and pick them up asap. I can come in today or tomorrow, I know its [short] notice however time is of short on our end and its relevant and very time sensitive. [ 41 ] The next day, Ms. Ferguson informed Mr. MacKay that she would pick up the Plaintiff’s solicitor client file. Mr.

MacKay made a note of their conversation which reads as follows: I told her to file a S/C Rt. Away ... had early limitation period. She is picking up the file this aft and will see lawyer right away. [ 42 ] Ms. Ferguson picked up the Plaintiff’s solicitor-client file on February 26, 2013. A cover letter authored by Mr. Mackay was attached to the file. It reads: You have requested the complete file from this office with respect to work done by Mr. Cheema. ... I note that you gave the money to the Vendor directly and that you did not deliver funds through Mr. Cheema. What Mr. Cheema did was to register Title.

I would ask you to find correspondence from the lawyer for the Vendor indicating that the Vendor would be taking personal responsibility to discharge the Mortgage, which is registered on the property to [First Calgary]. With respect to limitation periods, you have spoken to another law firm and I understand that you are considering litigation. If the requirement is that [the Vendor] discharges the Mortgage no later than 30 days from the date that you registered, then your limitation period may end on March 15, 2013, or possibly March 28, 2013.

Whenever there is doubt about limitation periods, one should always assume the worst case, which would be a limitation period ending on March 15, 2013, if there is a 30-day obligation. I would strongly urge you to see your lawyer immediately to explore your options, and I would suggest that you do so this week. I would draw your attention to the letter, dated December 10, 2010, from [Mr. Thiara] with respect to the obligation to discharge the encumbrance no later than 30 days from the date on which the Transfer of Land was registered. I urge that you move on this matter immediately to protect your interests.

I would advise you that Mr. Cheema is now with a different law firm, and my understanding is that he does not undertake litigation of this nature. Neither do I practise real estate litigation. I strongly recommend that you seek advice from counsel immediately. [ 43 ] Ms. Ferguson admits that she looked over Mr. MacKay’s cover letter and went through the Plaintiff’s file with her mother. She did not contact Mr. MacKay with any questions. F. Further Steps Taken by the Plaintiff [ 44 ] Rather than provide the Plaintiff’s file to a lawyer as Ms. Ferguson told Ms. Paquette and Mr. MacKay she was going to do, Ms.

Ferguson and her mother engaged in several months of discussions with Mr. Thiara. Those discussions went nowhere, with Mr. Thiara continuing to stall. [ 45 ] In parallel, Ms. Ferguson and her mother were also corresponding with First Calgary. In May 2014, First Calgary sought confirmation from Ms. Ferguson that the Plaintiff had paid the Developer for the Land. Ms. Ferguson attached copies of the Offer and cheques and bank draft evidencing the Plaintiff’s payment. On May 21, 2014, First Calgary sent Ms.

Ferguson and her mother an e-mail as follows: ...As far as we can ascertain your WRIT remains on title, but [First Calgary] never received payment for the sale, and as such remains [First Calgary] security... G. Foreclosure of the Land [ 46 ] In August 2014, the Plaintiff was served with First Calgary’s foreclosure application.

This is when the Plaintiff says that it learned that the Developer had failed to satisfy First Calgary’s mortgage, that the Land had been transferred to the Plaintiff without First Calgary’s knowledge, and that First Calgary had not received any of the purchase monies the Plaintiff had paid to the Developer. [ 47 ] The outcome of the foreclosure proceedings for the Plaintiff was that it lost title to the Land and forfeited the money it paid to the Developer. H.

The Plaintiff Sues the MacKay Defendants [ 48 ] On July 13, 2016, The Plaintiff commenced an action against various Defendants including the MacKay Defendants. The Plaintiff alleges that the MacKay Defendants breached their professional duties to the Plaintiff in respect of the Land purchase.

[ 49 ] In her Affidavit sworn on January 24, 2019, Ms.

Ferguson summarized her complaints regarding the professional services she received from the MacKay Defendants: • she was not advised about the “extent, identity, and nature of the registrations against the title to the [Land]”; • she was not advised that the Developer was not in a position to pay First Calgary’s mortgage, or that there was a risk that the Developer would default; • she was not advised that the Plaintiff did not, or could not, get clear title to the Land; and that • consequently, the Plaintiff was deprived of the opportunity to resolve the issue of First Calgary’s mortgage and to explore opportunities to negotiate an outcome in its favour. [ 50 ] Additionally, the Plaintiff asserts at paragraph 32 of its Statement of Claim that: • The Plaintiff did not receive any advice from the MacKay Defendants “respecting any aspects of [Mr.] Cheema’s retainer, or the Land Purchase, or its completion, other than [Ms.

Paquette] eventually informing [Ms. Ferguson] that title to the Land had registered in the name of the Plaintiff; and that • The Plaintiff was not advised, consulted or had any knowledge about the content of the Developer’s lawyer’s fax to Mr. Cheema dated December 21, 2010, or the Developer’s letter to the Plaintiff dated December 10, 2010. V. Analysis [ 51 ] There are two issues that I must decide: A. Can I grant the Plaintiff

summary judgment of its action with respect to the MacKay Defendants? B. Is the Plaintiff’s action against the MacKay Defendants statute-barred due to limitations? A. Can I Grant the Plaintiff

Summary Judgment of its Action with Respect to the MacKay Defendants? [ 52 ] I can only grant the Plaintiff

summary judgment of its negligence claim against the MacKay Defendants if I am satisfied on a balance of probabilities that the Plaintiff has proven that the scope of Mr. Cheema’s retainer required him to carry out those professional services the Plaintiff alleges he failed to properly perform. [ 53 ] The evidentiary record irreconcilably clashes as to what the terms and scope of Mr. Cheema’s retainer with the Plaintiff were. [ 54 ] Ms. Paquette specifically recalls that Ms. Ferguson provided her with clear instructions on June 15, 2010, as to what she wanted Mr. Cheema to do: as Ms.

Ferguson had already paid the Developer, Mr. Cheema’s retainer was limited in scope to simply registering the transfer of the Land to the Plaintiff and that Ms. Ferguson would deal directly with the Developer with respect to the removal of any encumbrances. Ms. Paquette says that she spoke again with Ms. Ferguson after having obtained a title search during which Ms. Ferguson confirmed that Mr. Cheema was only to “register the transfer”. [ 55 ] Ms. Paquette’s evidence is directly contradictory. She claims that her only conversations with anyone at the firm occurred on November 3, when she spoke with Mr. Cheema.

Ms. Ferguson specifically denies speaking with Ms. Paquette via telephone on June 15, 2010, and adamantly asserts that she did not agree to a limited scope retainer. [ 56 ] Mr. Cheema is not a reliable witness. He does not recall his interactions with Ms. Ferguson, cannot say if he entered into a written retainer agreement, does not know whether he spoke to Ms. Ferguson during the course of his retainer and does not remember whether he and Ms. Ferguson discussed the terms of his retainer. He acknowledges that Ms. Paquette handled all communications with Ms. Ferguson. I do not attach any weight to Mr.

Cheema’s evidence as to what he understood the scope of his retainer to be. He has no independent recollection of the work he performed for Ms. Ferguson and his understanding of the scope of his retainer is derived entirely from what he was told by Ms. Paquette. [ 57 ] There is irreconcilable evidence on the terms and scope of Mr. Cheema’s retainer. While I acknowledge that I may grant

summary judgment where there are contested facts or conflicting evidence, I take the view that it is inappropriate for me to do so when there is an irreconcilable clash on material facts that precludes me from fairly determining the central issue, namely the scope of Mr. Cheema’s retainer and the professional services the parties agreed Mr. Cheema would perform. [ 58 ] The difference between Ms. Ferguson and Ms. Paquette’s evidence cannot be reconciled other than at trial where a judge can make findings of credibility. I agree with the Master that the evidentiary record with respect to the scope of Mr. Cheema’s retainer does not allow a fair disposition through

summary proceedings and that the issue of the precise scope of Mr. Cheema’s retainer is a genuine issue that can only be resolved at trial. B. Is the Plaintiff’s Action Against the MacKay Defendants Statute Barred Due to Limitations? [ 59 ] I agree with the Master’s conclusions that the Plaintiff’s action, filed on July 13, 2016, is statute barred due to limitations as

against the MacKay Defendants. [60] Pursuant to section 3(1) of the Limitations Act, RSA 2000, c L-12 (the “Act”), the two-year limitation period begins to runwhen the Plaintiff must have known or in the circumstances ought to have known that the injury occurred, that the injury was attributableto the conduct of the defendant, and that the injury (assuming liability on the part of the defendant) warrants bringing a proceeding (seeMitchell v Pytel, 2021 ABQB 403 at paras 275-285 for a recent

summary of the case law interpreting section 3(1) of the LimitationsAct). “Injury”, as used in section 3(1)(

a) of the Act and as applicable here might either be “non-performance of an obligation” (1(e)(iv)),or “...the breach of a duty” (section 1(e)(v)). [61] Discoverability, as it relates to the Plaintiff’s knowledge of the elements enumerated in section 3(1) of the Act requiresreasonable diligence on the part of the Plaintiff.

While the Plaintiff’s knowledge must constitute more than “mere suspicion”, thePlaintiff need not have: “perfect knowledge” or a “certainty that the claim will succeed” (Weir-Jones at para 58), “clear information”(Canadian Natural Resources Ltd v Jensen Resources Ltd, 2013 ABCA 399 at para 41), or “perfect certainty”: Even if the discoverability rule of limitations applies to this case...it does not call for perfect certainty. It does not require discovery at all:it says something else will do instead.

It suffices that “the material facts on which [the cause of action] is based ... ought to have beendiscovered by the plaintiff by the exercise of reasonable diligence...” If the plaintiff is told a fact by someone who is likely to know,surely that makes the fact known or discoverable, even if someone else disputes the fact.

Very few people who sue have perfectcertainty. (Hill v Alberta (South Alberta Land Registration District), 1993 ABCA 75 at para 8, cited with approval in De Shazo vNations Energy Company Ltd, 2005 ABCA 241 at para 31). [62] Further, discoverability relates to the Plaintiff’s knowledge of the facts supporting a claim, “not the applicable law or anyassurances of success” (Weir-Jones at para 56) and to knowledge that an injury occurred rather than that the injury gives rise to a causeof action (HOOP Realty Inc v Emery Jamieson LLP, 2020 ABCA 159 at para 55 [HOOP Realty]). [63] Whether the Plaintiff knew, or ought to have known that their injury warrants bringing a proceeding hinges on whether“someone in the plaintiff’s position, acting reasonably in light of his or her own circumstances and interests, could – notnecessarily should – bring an action (Novak v Bond, (SCC), 1999 1 SCR 808 at para 81 [Novak]).

Factors that mightbe found to preclude a reasonable Plaintiff from promptly commencing an action include where “the costs and strain of litigation wouldbe overwhelming to him or her, the possible damages recoverable would be minimal or speculative at best, or other personalcircumstances combine to make it unfeasible to initiate an action” (Novak at para 85 and HOOP Realty at para 56). [64] In their written submissions, the MacKay Defendants identify potential dates on which the commencement of the limitationperiod might crystallize: • In March 2011, when Ms. Ferguson receives Mr.

Cheema’s reporting letter which encloses title to the Land. The Title confirmedFirst Calgary’s mortgage registered on title; • In June 2011, when, in reply to Ms. Ferguson’s question as to whether there was still a caveat registered on title to the Land, Ms.Paquette provides her with a copy of the title, confirms that the vendor’s charges had not yet been removed as per the Developer’sundertaking of its December 10, 2010 letter. Ms. Paquette offers to speak with Mr. Thiara but Ms.

Ferguson indicates that she willcontact the Developer; • In September 2012, when, in her e-mail to First Calgary’s account manager and to Mr. Cheema, Ms. Ferguson is aware that FirstCalgary’s blanket mortgage has not been removed as it was supposed to have been; • In January 2012, as a result of retaining Mr. Ingimundson to obtain clear title. Mr. Ingimundson is apprised of the situation as hewas provided with Mr.

Cheema’s reporting letter, the Offer and other documents and would, through his unsuccessful discussions withthe Developer, be fully aware of First Calgary’s mortgage; • In February 2013, when the Plaintiff obtains its solicitor client file which includes Mr.

MacKay’s cover letter warning aboutpotential impending limitation issues from the MacKay Defendants; and • On May 21, 2014, when First Calgary advises the Plaintiff that First Calgary’s mortgage cannot be discharged and that the Landsremain First Calgary’s security. [65] The Plaintiff argues that the limitation period does not commence in March 2011, as it is unclear whether Mr. Cheema’sreporting letter and statement of account was received by the Plaintiff at the time. Ms. Ferguson deposes that she “has no knowledge” ofthese documents and that they were sent to an address that was not the Plaintiff’s address.

I agree with the MacKay Defendants that Ms.Ferguson is mistaken that she has not seen Mr. Cheema’s reporting letter as she provided a copy of it to Mr. Ingimundson on January 24,2012, and it formed a part of the Plaintiff’s solicitor-client file which she picked up in February 2013, and reviewed with her mother. [66] With respect to Ms. Ferguson and Ms. Paquette’s correspondence in June 2011, the Plaintiff asserts that Ms. Ferguson’sinexperience with real estate transactions and Mr.

Cheema’s lack of communication precluded her from appreciating the consequence ofFirst Calgary’s continued registration of its mortgage on title to the Land. [67] Finally, the Plaintiff argues that the limitation period does not commence as a result of the Plaintiff’s retainer of Mr.Ingimundson because he was retained to address First Calgary’s lingering mortgage and to negotiate a favourable outcome to thePlaintiff, rather than to assess Mr. Cheema’s services and whether there was a basis for a negligence claim against the MacKayDefendants.

[ 68 ] Even if I accept the Plaintiff’s assertions that none of these events: Mr. Cheema’s reporting letter that may not have been received by the Plaintiff in March 2011; Ms. Ferguson’s correspondence with Ms. Paquette in June 2011; or even the completion of Mr. Ingimundson’s retainer in early 2012, are not either individually or cumulatively sufficient to trigger the running of the limitation period, I do not see how the limitation period does not commence to run at the very latest either in February 2013, when Ms.

Ferguson obtained the Plaintiff’s solicitor-client file, or, at the very, very latest , in May 2014, when the Plaintiff was advised that First Calgary had not received the Plaintiff’s payment for the Land and that the mortgage could therefore not be discharged. In either case, the Plaintiff’s action was filed outside of the 2-year limitation period. i. The Limitation Period Commences in February 2013 [ 69 ] Upon obtaining its file from Mr.

MacKay on February 26, 2013, the Plaintiff knew or ought reasonably to have known: - that First Calgary’s mortgage continued to be registered on the title to the Land; - that the Developer had not discharged First Calgary’s mortgage contrary to its undertaking to do so; - that Mr. Cheema had not obtained a discharge of First Calgary’s mortgage; - that Mr. Ingimundson had not obtained a discharge of First Calgary’s mortgage; - that the Developer had not raised sufficient funds from the sale of Windhorse Manor lots to discharge First Calgary’s mortgage from the Plaintiff’s Land; - that Mr.

Cheema was the only lawyer at the firm of MacKay & Cheema firm to have provided the Plaintiff with professional services; - that Mr. Cheema had not fulfilled the professional services that the Plaintiff alleges it hired him to perform; and - that there were potential limitation issues with respect to the Developer’s failure to discharge the mortgage in respect of which Mr.

MacKay strongly recommended the Plaintiff seek legal advice immediately. [ 70 ] I agree with the Master that this is not a complicated set of facts and that upon having obtained its file in February 2013, the Plaintiff had all the necessary facts it needed to trigger the commencement of the limitations period. I agree with the MacKay Defendants that this case is similar to and should be decided similarly to Templanza v Wolman , 2016 ABCA 1 . [ 71 ] Ms. Ferguson agreed to the Land purchase without the benefit of legal advice and, further, fully paid the Developer before involving Mr. Cheema.

Despite the Plaintiff asserting that, as a result of Mr. Cheema’s negligence, Ms. Ferguson was not advised about the “extent, identity, and nature of the registrations against the title to the [Land]”, Ms. Ferguson has deposed that she understood the term “blanket mortgage” as meaning “anything – a caveat, a mortgage, a blanket mortgage, they were all something that was – could be on a title”. During oral argument, the Plaintiff’s counsel acknowledged that Ms. Ferguson’s mother understood that First Calgary’s mortgage could only be discharged if the Developer was able to sell sufficient lots in Windhorse Manor.

If the Fergusons misjudged their own knowledge in real estate matters then this does not assist the Plaintiff as “error, or ignorance of the law, or uncertainty of the law does not postpone any limitation period” ( Hill v Alberta (Registrar of Land Agents) , 1993 ABCA 75 at para 9 ). [ 72 ] However, the Plaintiff characterizes Mr. MacKay’s cover letter, attached to the Plaintiff’s solicitor client file as ‘inexplicable and troubling misdirection of [Ms. Ferguson] away from her inquires of First Calgary; [Mr.

MacKay’s] troubling, self-serving, Freudian, cover letter, penned obviously in his own self-interest, assuring [Ms. Ferguson] that [the MacKay Defendants] had done everything right, and parroting [Mr. Cheema’s] self-interested misdirection, ‘urging’ her to “move on” to the [Developer] for answers. [ 73 ] I do not accept the Plaintiff’s characterization of Mr. MacKay’s letter. Mr. MacKay informed the Plaintiff what he understood from a review of the file and Ms. Paquette’s note to the file. Mr.

MacKay acknowledged that he did not have the expertise to give real estate litigation advice and provided appropriate warnings about impending limitations issues. I see nothing in MacKay’s letter that is misdirecting, self-serving, otherwise inappropriate, or that would obscure from the Plaintiff the nature, scope, or extent of Mr. Cheema’s legal services. Simply put, a reasonable person in the Fergusons’ shoes would have, as Ms. Ferguson said she would and as Mr.

MacKay had recommended in the strongest terms, immediately brought the file to a lawyer for a review and advice. [ 74 ] Consequently, I agree entirely with the Master’s assessment set out in paragraph 101 of her decision as to what facts that the Plaintiff knew when it obtained it’s file in February 2013, and I share her conclusion at paragraph 102 of her decision: A person in [the Plaintiff’s] circumstances of not having received any communication from its former counsel about the risk presented by the Developer’s mortgage remaining on title or strategies to address it, acting with reasonable diligence, would have been able to learn with minimal inquiry of the reason for and the risk posed by that continuing registration and that action was warranted against that counsel, within reasonable time of receiving the file from Mr.

MacKay on February 26, 2013, at the latest. [ 75 ] In the result, I agree that the limitation period commences to run at the very latest upon the Plaintiff obtaining its file in February 2013.

ii. The Limitation Period Commences in May, 2014 [ 76 ] If I am wrong that the limitation period does not commence upon the Plaintiff obtaining its solicitor-client file in February 2013, then I do not see how the limitation period does not commence to run at the very, very latest , in May 2014. [ 77 ] On May 21, 2014, First Calgary confirmed that it would not discharge its mortgage against the Land due to the Developer’s actions.

Consequently, the Plaintiff would have known that as its Land remained subject to First Calgary’s mortgage and as its payment for the Land had gone missing, the Land was First Calgary’s security and remained subject to foreclosure. [ 78 ] What further information did the Plaintiff need to know before it could have discovered that it had a potential claim against the MacKay Defendants?

What new facts did the Plaintiff learn between First Calgary’s May 21, 2014, e-mail and the filing of First Calgary’s foreclosure proceedings in August 2014, that would have filled in those blanks? [ 79 ] By this time, the Plaintiff had more than a year to review its solicitor client file and would have had ample time to explore Mr. Cheema’s conduct.

Upon receiving First Calgary’s May 21, 2014, e-mail, the Plaintiff would have been able to connect the dots between what it believed was the MacKay Defendants’ breach of duty or non-performance of its professional obligations with First Calgary’s confirmation that the Plaintiff’s Land remained First Calgary’s security. If this information did not, as the Master put it at paragraph 117 of her decision “operate to bring the point home”, then what further information would the Plaintiff have needed to know for discoverability of its claim against the MacKay Defendants to crystallize?

I simply cannot identify any facts that would further have advanced the Plaintiff in its inquiry. [ 80 ] As indicated above at paragraph 46, the Plaintiff asserts that it was not until August 2014, when First Calgary commenced foreclosure proceedings against the Land that the Plaintiff learned that the Developer had failed to satisfy First Calgary’s mortgage, that the Land had been transferred to the Plaintiff without First Calgary’s knowledge, and that First Calgary had not received any of the purchase monies the Plaintiff had paid to the Developer.

I do not see how the Plaintiff can plausibly advance this argument given First Calgary’s e-mail to the Plaintiff on May 21, 2014, which advised the Plaintiff of precisely this. VI. Disposition [ 81 ] The Plaintiff’s appeal of the Master’s decision is dismissed. [ 82 ] If the parties are unable to reach an agreement with respect to costs, they may provide written submissions, not exceeding 5 pages each, within the next 45 days. Heard on May 28, 2021. Dated at the City of Calgary, Alberta, June 28, 2021. O.P. Malik J.C.Q.B.A. Appearances: E.M.

Keohane, for the Plaintiff, 1490703 Alberta Ltd Zul Verjee QC for the MacKay Defendants, Novy Cheema, Murray D. MacKay, Murray MacKay Professional Corporation