McKay v Cody, 2021 ABQB 573

Court of Queen’s Bench of Alberta Citation: McKay v Cody, 2021 ABQB 573 Date: 20210721 Docket: 2003 19508 Registry: Edmonton Between: John Russell McKay Plaintiff - and - Shaun Cody and New Horizon Law LLP Defendants _______________________________________________________ Endorsement of L.A. Smart , Master, Court of Queen's Bench of Alberta _______________________________________________________ Introduction [ 1 ] The Defendants apply for

summary dismissal of this action by the Plaintiff McKay on the basis that he did not seek a remedial order within two years as required by s 3.1 of the Limitations Act, RSA 2000, c L-12 . The Defendant Cody and his firm (Cody) was legal counsel for McKay in an action against his former lawyer. This action arises from the dismissal of that action for long delay. At the application it was determined that the affidavit of McKay was not in the SharePoint material and needed to be located so that it could be reviewed before a decision was made. McKay’s affidavit was located and I have reviewed it.

Background [ 2 ] The application for dismissal for long delay in that action was heard by Master Schulz on October 4, 2017 and she rendered her written decision dismissing the action on November 6, 2017 ( 2017 ABQB 694 ). Her decision was appealed and heard by Justice J. Ross on September 6, 2018. Justice Ross rendered her written decision on November 29, 2018 upholding the decision of Master Schulz

to dismiss the action (2018 ABQB 975). A further appeal to the Court of Appeal was dismissed on April 3, 2020 (2020 ABCA 131). [3] This action was commenced on November 27, 2020 being two days before two years from the written decision given byJustice Ross. Counsel for the Defendants takes a direct approach to his argument for dismissal. Upon Master Schulz rendering herdecision McKay suffered an injury (nonperformance of an obligation by the Defendants), that he knew about it when the decision hadbeen made and communicated to him.

Two years started to run then and failure to seek a remedial order within that time ends the matter. [4] Cody has sworn an affidavit where he states that he fully explained the potential ramifications to McKay shortly afterreceiving the application for dismissal including his action coming to an end and the cost consequences. Furthermore, Cody stated headvised McKay that he was putting his professional liability insurer on notice.

McKay in his responding affidavit says that Cody did notadvise him his action would come to an end regardless of appeals nor did he advise him at any time that the limitation period to sue himwould commence if that application to dismiss was successful before the Master. Finally, McKay says that Cody did not tell him that hewas referring this matter to his professional liability insurers. [5] New counsel was appointed to represent McKay’s interest at the dismissal application. Mr.

McKay indicates he believed thatnew counsel was independent although he was unsure who exactly had retained her and that he did not receive any advice from a newcounsel regarding any limitation period before or after the order of Master Schulz. Mr. McKay says he was led to believe by the newcounsel and Cody that the appeal had merit and a reasonable chance of success. [6] McKay says that until the Court of Appeal dismissed his appeal, he did not believe proceedings against Cody to be warrantedfor several reasons. Briefly these reasons are as follows: 1.

Both new counsel and Cody were clear that “there was a good argument that the Master was wrong and there was a good arguableappeal (although not certain)” and only after the Court of Appeal made its pronouncement was the damage done; 2. He was concerned that suing Cody before the appeals were exhausted would rupture his relationship with him and preclude Cody’sfurther willingness to be involved in the Underlying Action; 3. He believed the major reason for the dismissal application was that opposing counsel had not responded to Cody in a timelyfashion and was responsible for the delay.

After the appeals were exhausted it was apparent to him that that view was wrong andproceedings were warranted. Discussion [7] The relevant part of Section 3(1) of the Limitations Act for this application provides: … [I]f a claimant does not seek a remedial order within (a) 2 years after the date on which the claimant first knew, or in the circumstances ought to have known, (

i) that the injury for which the claimant seeks a remedial order had occurred, (ii) that the injury was attributable to the conduct of the defendant, and (iii) that the injury, assuming liability on the part of the defendant, warrants bringing a proceeding, or (b) 10 years after the claim arose, whichever period expires first, the defendant, on pleading this Act as a defence, is entitled to immunity from liability inrespect of the claim. [8] In this case the evidence is clear that McKay knew of the facts supporting the claim for relief when the decision of MasterSchulz was communicated to him.

It was equally clear that the injury was attributable to the Defendants. The remaining question is whenthe bringing of the proceeding was warranted. [9] The Court of Appeal addressed this question in Hoopp Realty Inc v Emery Jamieson LLP, 2020 ABCA 159 at para 56: [56] This Court has adopted the guidance from Novak v Bond, (SCC), [1999] 1 SCR 808, 8 WWR 499 as to when aninjury would warrant bringing a proceeding. This provision speaks not to the legal strength of a plaintiff’s case for recovery, but to thecircumstances of the plaintiff: Nipshank v Trimble, 2014 ABQB 120 at para 9. As set out in N(

J) v Kozens, 2004 ABCA 394: [14] In Novak v. Bond, supra, Major, J. noted that the critical time is one “at which a reasonable person would consider that someone inthe plaintiff’s position, acting reasonably in light of his or her own circumstances and interests, could - not necessarily should - bring anaction. This approach is neither purely subjective nor purely objective.

The question becomes: ‘in light of his or her own circumstancesand interests, at what point could the plaintiff reasonably have brought an action?’” (at para. 81) McLachlin, J. (as she then was),speaking for the majority in the same case, also espoused a variant of a “restrictive subjective/objective approach” that takes into accountthe plaintiff’s “important and substantial interests.” (at para. 38), adding that “[p]urely tactical considerations have no place in thisanalysis.” (at para. 81) Time begins to run, she explained, when, “in light of the plaintiff’s particular situation, the bringing of a suit isreasonably possible, not when it would be ideal from the plaintiff’s perspective to do so.” (at para. 84) [15] McLachlin, J. in Novak provided the following as examples of when a plaintiff may not reasonably be able to bring an action whenviewed objectively but with regard to the plaintiff’s own situation:

(

a) the costs and strains of litigation would be overwhelming to him or her, (

b) the possible damages recoverable would be minimal or speculative at best, or (

c) other personal circumstances combined to make it unfeasible to initiate an action. [ 10 ] The evidence before me discloses no impediments to McKay that would have prevented him from commencing an action within the time prescribed by the Limitations Act . Conclusion [ 11 ] Although there are facts in dispute as between the parties, it is unnecessary to resolve those disputed facts to make a decision in this case. On the record before me it is clear that McKay failed to commence his action within the time prescribed by the Limitations Act . On that basis a fair and just determination may be made.

The application of the Defendants is granted and the action is accordingly summarily dismissed. [ 12 ] Unless there are other considerations as to costs that were not brought to my attention, the Defendants shall have one set of costs based on the appropriate column of

Schedule C plus all reasonable disbursements. Heard on the 5 th day of March, 2021. Dated at the City of Edmonton, Alberta this 21 st day of July, 2021. L.A. Smart M.C.Q.B.A. Appearances: Stuart Weatherill Emery Jamieson LLP for the Applicants/Defendants John Russell McKay Self Represented for the Respondent/Plaintiff