Jacobsen v Wawanesa Mutual Insurance Company, 2021 ABQB 938

Court of Queen’s Bench of Alberta Citation: Jacobsen v Wawanesa Mutual Insurance Company, 2021 ABQB 938 Date: 20211123 Docket: 1006 00830 Registry: Lethbridge Between: Bent Jacobsen and Norma Ruth Gehring Plaintiffs (Respondents) - and - Wawanesa Mutual Insurance Company, R. Frank Llewellyn and R. Frank Llewellyn Professional Corporation Defendants (Appellant) _______________________________________________________ Memorandum of Decision of the Honourable Madam Justice S.L.

Kachur _______________________________________________________ [ 1 ] This is an appeal from a Master’s decision that refused the Defendant’s request to dismiss an action for inordinate delay. [ 2 ] The dispute concerns water damage to the home of Mr. Jacobsen, who is the original Plaintiff in the underlying action and the Respondent in this appeal. The Appellant is Wawanesa Mutual Insurance Company, who is a Defendant in the underlying claim by virtue of being Mr. Jacobsen’s home insurer. [ 3 ] The Plaintiff has discontinued against some of the original Defendants, and a second Plaintiff, Ms.

Gehring, was added in 2018. In these reasons I refer to the singular Plaintiff for events prior to 2018 and the plural Plaintiffs for more recent developments. [ 4 ] The action originated from an alleged property loss claim that occurred in or around March 15, 2008. Following the incident, the Plaintiff directly retained Durable Roofing Ltd. to repair the damage, and the Defendant issued a cheque to pay for the repairs. After that, the Plaintiff alleged deficiencies in the repair work. They sought further compensation from the Defendant, which was denied and led to this action.

The Plaintiff filed a Statement of Claim in October 2010, but no trial date was set as of the hearing, and further steps were still required.

[ 5 ] The Plaintiffs argue that the appeal is time-barred according to Rule 6.14, and a request for an extension has not been sought. The Plaintiffs also argue that the Master did not err in denying the Defendant’s application as no inordinate delay had occurred, as any delay that has happened in large part has been enabled or encouraged by the Defendants, and they further argue there is no significant prejudice to the Defendant. [ 6 ] The Defendant argues that the Order was served the same day as the Notice of Appeal and complies with the Alberta Rules of Court .

They further argue that the Master erred in declining to dismiss the action for inordinate delay, so this appeal should be allowed. For the reasons below, I find the appeal was filed within the limits dictated by the Alberta Rules of Court I further find that the Master erred in finding that there was no prejudice to the Defendants. Issues: 1. Is the Appeal statute barred under Rule 6.14 of the Alberta Rules of Court ? 2. If not, did Master Farrington err in denying Wawanesa’s application to dismiss the Plaintiffs’ claim for inordinate delay pursuant to Rule 4.31 of the Alberta Rules of Court ? 3.

Did Master Farrington err in ordering procedural deadlines against Wawanesa despite finding the Plaintiff’s delay was inordinate with no reasonable explanation? 1. Is the Appeal Statute Barred? [ 7 ] Rule 6.14(2) of the Alberta Rules of Court dictates that a Notice of Appeal must be filed and served within 10 days after the Order is entered and served . The Order was signed by Master Farrington on October 28, 2020, but was not entered by the court until November 26, 2020. The Plaintiff argues this appeal is therefore time-barred. [ 8 ] The chronology of events leading to service of the Order is as follows: 1.

The application to dismiss the action was heard and dismissed on October 20, 2020. The Master directed the Defendant to prepare the form of Order. 2. The form of Order was sent to the Master for endorsement and filing on October 28, 2020. 3. The Order was returned to counsel for the Defendant on October 30, 2020, signed but not filed. 4. The Order was not returned to the Court for filing until November 25, 2020. On that same day, counsel for the Defendant informed counsel for the Plaintiffs of their intention to appeal. 5.

When the Court returned the Order, the file stamp incorrectly stated the filing date as October 23, 2020. 6. A Notice to appeal was sent to the Court on December 8, 2020 but was rejected. 7. After communication with the Court and an Endorsement by ACJ Rooke, the Notice of Appeal was ultimately filed on December 18, 2020, and served with the Original Order on December 21, 2020. [ 9 ] The Defendants argue that the appeal is not statute-barred as the 10-day time limit to file notice of appeal does not start until the order has been both filed and served.

In this case, though it was filed on November 23, it was not served on the Plaintiffs until December 21. [ 10 ] The Notice of Appeal was served more than two months after Master Farrington issued the Order, which is a significant delay. However, during the months of October to December 2020, the efficiency of this court’s filing process was significantly compromised by the COVID-19 pandemic. The electronic filing system that had been implemented to accommodate the government of Alberta’s pandemic restrictions contributed to longer delays and increased error rates in document filing.

In this case, the Order was not properly filed when it was signed, and a month later the incorrect filing date was applied to it. [ 11 ] The fact that the Defendants were directed to prepare the Order, gave them the control over when it would be filed and served therefore determining the timing to file a Notice to Appeal.

The Plaintiffs were notified of the intention to Appeal even before the Order was served and were served with the formal Notice to Appeal at the same time they were served with the actual Order. [ 12 ] As such, the Appeal of Master Farrington’s Order is not barred by the time limits in the Alberta Rules of Court . 2. Did Master Farrington err in denying Wawanesa’s application to dismiss the Plaintiffs’ claim for inordinate delay pursuant to Rule 4.31 of the Alberta Rules of Court . [ 13 ] An appeal from a Master’s decision is a de novo review, on the standard of correctness.

Therefore, I must analyze the issues and decide whether I reach the same decision as the Master.

[ 14 ] Rule 4.31 directs that a Court may dismiss an action where the delay has resulted in significant prejudice to the Defendant. Where it is determined that the delay is inordinate, it is presumed to cause significant prejudice, unless that prejudice is rebutted by the Plaintiff. [ 15 ] The considerations for the Court under rule 4.31(2) are as follows: 1. Has the non-moving 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? 2.

Is the shortfall or differential of such magnitude to qualify as inordinate? 3. If the delay is inordinate has the non-moving party provided an explanation for the delay? If so, does it justify inordinate delay? 4. Has the moving party demonstrated significant prejudice? 5. If the moving party relies on the presumption of significant prejudice created by Rule 4.31(2), has the non-moving party rebutted the presumption of significant prejudice? 6.

If the moving party has met the criteria for granting relief under Rule 4.31(2), is there a compelling reason not to dismiss the non- moving party’s action? ( Humphreys v. Trebilcock , 2017 ABCA 116 at par. 150-156 ) [ 16 ] The steps that have occurred in this action are as follows: 1. A Statement of Claim was filed by the Plaintiff, Bent Jacobsen, on October 14, 2010. 2. A Statement of Defence was filed and served by Wawanesa on April 11, 2011. 3. The Plaintiff, Bent Jacobsen served his affidavit of records on June 9, 2011. 4. Wawanesa served its affidavit of records on June 20, 2011. 5. The Defendant’s R.

Frank Llewellyn and R. Frank Llewellyn Professional Corporation, [former counsel for the Plaintiff] served their affidavits of records on December 20, 2011. 6. Questioning of the Plaintiff, Bent Jacobsen, commenced on September 10, 2013. 7. Question of the Defendants, Frank Llewellyn and Trevor Grieves of Wawanesa occurred on January 22, 2013. 8. The Plaintiff Bent Jacobsen provided answers to a portion of his undertakings on December 16, 2013. 9. Counsel for the Plaintiff filed a withdrawal as lawyer of record on January 22, 2015. 10.

Knight LLP filed a notice of change of representation for the Plaintiff on February 17, 2015. 11. Questioning of the plaintiff, Bent Jacobsen continued on April 16, 2015. 12. R. Frank Llewellyn, and R. Frank Llewellyn Professional Corporation, Co-Defendants, scheduled an application for

summary dismissal on February 18, 2016. This application was adjourned to March 10, 2016, then to March 24, 2016, to May 26, 2016, and finally to June 9, 2016, when it was adjourned sine die . 13. The Plaintiff, Bent Jacobsen, provided answers to a portion of his undertakings again on March 17, 2016, and April 1, 2016. 14. Questioning of the Plaintiff Bent Jacobsen continued on September 21, 2016. 15. Knight LLP filed a notice of withdrawal as lawyer of record for the Plaintiff on January 9, 2017. 16. On January 12, 2017, R. Frank Llewellyn and R. Frank Llewellyn Professional Corporation again scheduled an application for

summary dismissal. This application was adjourned to August 27, 2017. 17. CBM lawyers LLP filed a notice of change of representation as counsel for Wawanesa on September 10, 2018. 18. The Plaintiff scheduled an application to obtain a full copy of Wawanesa file on October 19, 2018. The application was heard and adjourned to December 14, 2018, where it resulted in order that stipulated the following subparagraph: a. The statement of claim was to be amended to include the Plaintiff, Norma Ruth Gehring. b.

The Defendant Wawanesa was to issue a check in the amount of $5700 payable to both Plaintiff and Durable Roofing LTD as a replacement cheque to the original cheque issued on July 23, 2008. c. Wawanesa would use best efforts to locate the report of Paul Coppen, and if located, provide a copy of the report to the Plaintiffs. d. Wawanesa had leave to file and serve an amended Statement of Defence within 30 days from the date of the order. 19. Wawanesa provided the replacement cheque and Paul Coppen’s report on March 25, 2019.

20. On August 19, 2020, Wawanesa file the application to dismiss the action for inordinate delay pursuant to rule 4.31. [ 17 ] By the time the application for dismissal was filed by Wawanesa, almost 12 ½ years had passed since the original incident occurred and over 10 years had past since the Statement of Claim was filed. The only major steps that the Plaintiffs have taken are to file an affidavit of records, conduct questioning of the Defendants, although it is unknown if the questions are concluded, and to add an additional Plaintiff.

They have yet to provide all their answers to undertakings or to retain an expert. This is not a complex or complicated matter. Even after adding a new Plaintiff and obtaining a cheque and the report of Mr. Coppen, no action has been taken by the Plaintiffs.

An additional full year and a half passed from between when the new Plaintiff was added and Wawanesa brought this application, and now a further year has passed to the time of this appeal. [ 18 ] A 10-year delay in and of itself has been said to form a “presumptive ceiling beyond which delay can be presumed to be inordinate and unreasonable without a compelling explanation”: McCarthy v Schindeler , 2017 ABQB 511 .

However, each case must be assessed on its own facts to determine whether the delay is inordinate and inexcusable and, importantly whether there has been significant prejudice: Royal Bank of Canada v Levy , 2020 ABCA 338 . [ 19 ] More than 10 years passed prior to this application being brought and there is no compelling explanation provided by the Plaintiffs. The Plaintiffs admit that there has been delay in this action, although that fact is obvious. Little has been done by these Plaintiffs in a matter that is not complex or complicated.

There have not been a multitude of Defendants, interim applications, or issues. The Plaintiffs may not be sophisticated litigants themselves, but they have retained counsel on more than one occasion and were represented until 2017. Retention of new counsel is not deemed a valid excuse for the delay. Based on these factors I find that the delay has been inordinate. [ 20 ] The only justification the Plaintiffs give for the delay is that the Defendants have enabled or even encouraged the delay, particularly by not questioning the Plaintiffs or waiving their right to questioning.

Although both parties do have an obligation to move a matter forward, the ultimate burden lies with the Plaintiff: Stablilized Water of Canada Inc. v Better Business Bureau , 2016 ABQB 543 . As noted in Transamerica Life Canada v Oakwood Associates Advisory Group Ltd. , 2019 ABCA 276 many authorities confirm that defence delay is relevant, including in considering if the delay in inordinate, excusable, or relevant in assessing prejudice. [ 21 ] In this case I do not see the delays by the Defendants to be sufficient to dismiss the responsibility of the Plaintiffs.

Although Wawanesa itself has not questioned the Plaintiffs, it attended the questioning that was conducted by the other Defendants, and entered an agreement that all parties adverse in interest could use the transcripts. So, in fact, the questioning of Mr. Jacobson was effectively concluded subject to further questioning on undertakings. The Plaintiff has failed to provide all answers to undertakings from questioning that occurred more than 4-5 years prior. This cannot be seen as the Defendant’s responsibility.

Nor can this be seen as the Defendant adding to the delay or extinguishing the fact that the delay is inordinate and inexcusable. [ 22 ] I find the Defendant has not enabled or encouraged the delay, but even if I had, it would not justify the Plaintiffs’ failure to advance their claim in a timely manner. [ 23 ] Master Farrington also found there to be an inordinate delay which was not excusable and stated as follows: … the action has not proceeded at the pace that it should. Secondly, that it is inordinate… This should be a relatively simple case in my view, so it is inordinate delay.

And thirdly, I do not think there is a reasonable explanation given for why it is taken so long. [ 24 ] Finding that the delay is inordinate and inexcusable pursuant to R. 4.31(2) I must now consider whether the Defendant has demonstrated significant prejudice or if they are relying on the presumption of significant prejudice created by Rule 4.31(2) whether the Plaintiff has rebutted the presumption. [ 25 ] The Defendant argued that there is significant prejudice. They rely on the fact that part of their defense is the issue of possible pre-existing conditions caused by uninsured perils. Questioning of Mr.

Jacobson has shown a lack of memory. There is also a lack of documentation pertaining to the issue of the pre-existing conditions. Further the Plaintiffs, by their own admission still have not retained an expert. The Plaintiff has stated that one of the “only remaining tasks left to do is to retain an expert”. However, it is not the only remaining task as the Defendant may need to respond to any expert report that is provided. It would be problematic for any expert to assess damages that occurred more than 10 years ago.

All these factors lead to the determination that there is significant prejudice to the Defendant to advance their defence. [ 26 ] Further, as stated in Rule 4.31(2) where inordinate and inexcusable delay is found, the delay is presumed to have resulted in significant prejudice to the Defendant. That significant prejudice will be found unless the Plaintiff can disprove it on a balance of probabilities. The Plaintiffs have offered no evidence to show that the prejudice does not exist. There is nothing before me from the Plaintiffs that would discharge their burden.

Master Farrington stated in his finding: This is largely a cover issue case, whether a type of loss is covered or not. … In my view the presumption of significant prejudice has been rebutted. I think it is largely a coverage case and I think the presumption of significant prejudice is rebutted … [ 27 ] When specifically asked, the Plaintiffs could not point to any evidence that would show that this case is simply an issue of coverage. As stated, the Defendant is advancing as part of their defence pre-existing conditions.

This point would have to be proven or disproven through memories of the Plaintiff, which at 5 years already showed to be lacking. The Plaintiffs offer some photographs which allegedly minimize the memory issue, but these were not dated nor was their context clear. No expert reports from the Plaintiff exist which may be difficult to obtain now, some 14 years after the incident occurred.

The Plaintiffs have not rebutted the presumption that significant prejudice does not exist, and I find that Master Farrington erred in finding that they did. [ 28 ] As the Defendant has met the criteria for granting relief under Rule 4.31(2), I must determine if there is any compelling reason not to dismiss the Plaintiffs’ action. The Plaintiffs argue that the second Plaintiff, Ms. Gehring was only added in 2018 and it would be patently unreasonable to dismiss the claim as she has only been a plaintiff for approximately 3 years. It was on the Plaintiff’s application that Ms. Gehring was added.

When requesting to be added as a Plaintiff, the new Plaintiff is accepting the same

responsibilities of the original Plaintiff and it became her obligation along with Mr. Jacobsen’s obligation to move this matter forward. She accepted the role at the place it was in and had a responsibility to move it forward which she did not. The delay continued with no reasonable excuse. There continues to be inordinate delay with no reasonable explanation by either party. This is not a compelling reason not to dismiss. [ 29 ] For all of the reasons given I find that there has been an inordinate delay with no reasonable excuse, and insufficient evidence to rebut the presumption of significant prejudice.

Master Farrington was correct in finding that there was insufficient evidence as to the prejudice suffered by Wawanesa, but erred in placing the burden of proving prejudice on the Defendant. Under Rule 4.31(2), once inordinate and inexcusable delay is found, the Defendants benefit from a presumption of prejudice and the burden falls on the Plaintiffs to disprove it. No evidence was given by the Plaintiffs to rebut the presumption. As such, I allow the appeal. The Plaintiffs’ action against the Defendant Wawanesa is dismissed for inordinate delay. 3.

Did Master Farrington err in Ordering procedural deadlines against Wawanesa despite finding the Plaintiff’s delay was inordinate with no reasonable explanation? [ 30 ] As I have already determined that the action should be dismissed under rule 4.31(2) there is no need for me to determine this issue. The procedural deadlines set against Wawanesa are no longer required as the action against them is dismissed. Costs [ 31 ] Typically, the successful party is entitled to his or her costs. The Defendant was successful in both aspects of this appeal.

First in allowing the Appeal to go ahead as it was not barred, and secondly being successful in the Appeal itself. However, I am not inclined to award costs to either party. The Defendant, although with some reasonable excuse, took two months to serve the Order on the Plaintiffs. Although they did give advance warning of their intention to appeal, it still took them over a month after that notice to serve the Order on the Plaintiffs. This required involving ACJ Rooke and having a full argument on whether the Appeal was valid in the first place, which increased the costs and timing for both parties.

For this reason, I am directing that each party bear their own costs. Heard on the 17 th day of June, 2021. Dated at the City of Calgary, Alberta this 23 rd day of November, 2021. S.L. Kachur J.C.Q.B.A. Appearances: Spencer McMullin - Letourneau LLP for the Plaintiffs (Respondents) Russell R. Mann - Chomicki Baril Mah LLP for the Defendants (Appellant)