Grande Prairie (City) v Apotex Inc, 2023 ABKB 78

Court of King’s Bench of Alberta Citation: Grande Prairie (City) v Apotex Inc 2023 ABKB 78 Date: 20230210 Docket: 2001 07073 Registry: Calgary Between: Bristol-Myers Squibb Canada Inc., Bristol-Myers Squibb Canada Co., and Bristol-Myers Company Appellants/Defendants - and - Grande Prairie (City) and Brantford (City) as Representative Plaintiffs Respondents/Plaintiffs _______________________________________________________ Reasons for Decision of the Honourable Justice Colin C.J.

Feasby _______________________________________________________ Introduction [ 1 ] This is an appeal of a decision by Master Farrington, as he then was, refusing to grant an application for an order to set aside an earlier decision of his allowing an ex parte application to extend the time for service of a statement of claim for three months pursuant to Rule 3.26. An appeal from a Master, now an Applications Judge, is heard de novo : Agrium v Orbis Engineering Field Services , 2022

ABCA 266 at para 30 . [ 2 ] This appeal concerns whether service of a statement of claim should be set aside because inadequate evidence was adduced in support of an ex parte application for a three-month extension of the time for service pursuant to Rule 3.26.

To decide this appeal, I must consider whether there are factors relevant to exercising discretion to extend the time for service under Rule 3.26 beyond the non- exhaustive general principles set out in Scott v Westwinds Communities , 2021 ABCA 30 at para 37 . [ 3 ] For ease of reference, in these reasons I refer to the Appellants/Defendants as the “Bristol-Myers Defendants” and the Respondents/Plaintiffs as the “Representative Plaintiffs.” The Ex Parte Application and Application to Set Aside [ 4 ] On May 13, 2021, the Representative Plaintiffs applied ex parte for an order extending time for service of the Statement of Claim on many defendants, including the Bristol-Myers Defendants, and for an order authorizing service ex juris against certain foreign defendants including the Bristol-Myers entity located in the US.

Both orders were granted by Master Farrington. [ 5 ] An application to set aside the ex parte order extending the time for service was filed on August 30, 2021. The Representative Plaintiffs submit that the Bristol-Myers US entity is out of time to make an application to set aside Master Farrington’s order extending time for service because it was made more than 20 days after service was effected, contrary to Rule 9.15.

The evidence before me, however, establishes that service was effected on August 19, 2021. [ 6 ] The Representative Plaintiffs’ ex parte application to extend time for service of the Statement of Claim was supported by an Affidavit of Bernice Helfrich, a legal assistant employed by James H. Brown & Associates LLP. The Helfrich Affidavit states that James H. Brown & Associates LLP are solicitors for the Representative Plaintiffs, but they did not appear on any of the applications.

No additional evidence was adduced by the Representative Plaintiffs on the application to set aside or on this de novo appeal. [ 7 ] The first three paragraphs of the Helfrich Affidavit are introductory in nature. Paragraphs 4 to 19 of the Helfrich Affidavit detail counsel’s efforts to serve various defendants located outside Canada. Paragraphs 20 and 21 explain that service has been effected on 21 of 45 defendants and lists all the defendants in Canada who have been served.

The Helfrich Affidavit at paragraph 22 concludes by saying: “The COVID-19 pandemic has resulted in significant delays in service of documents in Canada and through the Central Authorities, as indicated by the lack of response to our inquiries or response indicating delayed time for service.” [ 8 ] There is no mention of any of the Bristol-Myers Defendants in the Helfrich Affidavit.

There was no evidence before Master Farrington on the ex parte application concerning attempts to serve the Bristol-Myers Defendants or why serving the Bristol-Myers Defendants might be challenging and require more time. [ 9 ] Despite the lack of evidence, Master Farrington expressed, in his reasons denying the application to set aside the ex parte order extending time for service, that “the affidavit was much more fulsome [ sic ] than we see on many of these extension applications.” He then concluded: the affidavit was sufficient.

It showed what had been done, what still needed to be done, [and] why an extension was necessary. I think that in a case with 45 defendants describing each one of them on a case-by-case basis as to the steps needed to be done in the future in relation to each of them is a higher expectation than the standard requires.

I think that the … Scott v Westwinds case focuses on a couple of things … that are not present here such as prejudice, there is none of that present or alleged here. [ 10 ] Master Farrington appears to have concluded that problems serving some of the defendants could justify an extension of time to serve the statement of claim in respect of all the defendants who had not yet been served. He saw no reason why the Representative Plaintiffs should be required to justify the extension of time to serve for each defendant who had not been served.

Extension of Time for Service Pursuant to Rule 3.26 [ 11 ] Rule 3.26(1) provides that a “statement of claim must be served on the defendant within one year after the date that the statement of claim is filed.” The Rules of Court allow for the extension of time for service in two circumstances.

Rule 3.27, which I discussed recently in Jelonek v Monterrosa-Renaud , 2022 ABKB 738 , provides for extensions of time for service at any time including after the time for service of a statement of claim has expired where the failure to serve is attributable in some way to the conduct of the defendant or a person who is not a party to the action. Rule 3.26(1) provides that an extension of the time to serve a statement of claim may be granted before the one-year period for serving a statement of claim has expired.

Rule 3.26(2) provides that the “extension of time for service under this rule must not exceed 3 months.” Rule 3.26 does not specify what reasons or evidence is required to justify an extension. [ 12 ] The Representative Plaintiffs rely on Oberg v Foothills Provincial General Hospital , 1999 ABCA 76 , which was decided under the old Rule 11, the predecessor to current Rules 3.26 and 3.27. Oberg established a very low threshold for obtaining an extension of time for service of a statement of claim.

Justice Conrad held that, the amendment of Rule 11 from requiring “sufficient reasons” to merely “reasons” indicated that, “[t]he need for reasons where an application is made within the time period should not be onerous”: Oberg at para 13 . Conrad JA went on to conclude that so long as the evidence before the court could support an inference that the extension was not a delay tactic, that is sufficient.

Early decisions concerning the new Rules of Court applied Oberg to Rule 3.26: Wardill v Peebles , 2012 ABQB 303 ; Padget Estate (Re) , 2014 ABQB 750 . [ 13 ] The Court of Appeal recently set out what it described as non-exhaustive general principles to be followed when exercising discretion under Rule 3.26 in Westwinds . The Court of Appeal’s effort to consolidate and restate the principles applicable to Rule 3.26 indicates that Oberg should no longer be relied upon. The Court of Appeal in Westwinds explained at para 37:

1. A Rule 3.26 application calls upon a court to exercise its discretion. The Rule does not provide a plaintiff with a unilateral rightto a three month extension. 2. The Rule is not only for the benefit of the plaintiff, as identified in Oberg, but also the defendant. It is for the benefit of thedefendant in that it establishes a further type of limitation period, over and above the Limitations Act, RSA 2000, c L-12, to know if onemust prepare to defend against a claim and assemble a defence. The passage of time can make this more difficult. 3. The application must be supported by an affidavit or other evidence.

See Rules 6.3 and 6.11. 4. The affidavit or other evidence should set out what attempts, if any, have been made to serve the defendant and explain thereason or reasons for the lack of service within the 12 months. This does not mean there is an absolute rule that some attempt to servemust be made before bringing an application under Rule 3.26. We agree with the observations of Master Smart at para 5 of Wardill that:“Simply put the evidence provided should state ‘why you need it and what have you done?’ ...

It makes no sense to have a deadline forservice within 12 months if extensions are granted as a matter of course with not even the barest threshold of evidence required.” 5. The purpose of the renewal cannot be a stalling tactic. 6. Prejudice to the defendant, if any, is a factor to consider. [14] The Court of Appeal was careful, as I have noted, to say that these general principles are non-exhaustive. Later in thesereasons, I will consider whether there are other factors that may justify a Court exercising discretion to extend the time for service underRule 3.26.

Evidence and the Question of Multiple Defendants [15] As explained earlier in these reasons, there was no evidence adduced by the Representative Plaintiffs concerning attempts toserve the Bristol-Myers Defendants or why more time for service was required to serve the Bristol-Myers Defendants. [16] The Representative Plaintiffs submit that there is no authority for the proposition that to extend time for service of a statementof claim there must be evidence with respect to each defendant.

In essence, the Representative Plaintiffs submit that an order forextension of the time to serve a statement of claim pursuant to Rule 3.26 is a blanket extension that applies to all defendants. Thepragmatism of this approach is attractive; it is easy to administer and puts all defendants on the same footing. [17] The requirement for evidence stated in Westwinds, however, is best interpreted as meaning evidence with respect to thespecific defendant for which the extension of time to serve is sought. Westwinds conceptualizes the time limit for serving a statement ofclaim as being akin to a limitation period.

For a time period for service of a statement of claim to be extended and delay the accrual of aright of a defendant that was not served (ie. the right to have the claim dismissed), the only reasonable

interpretation is that there must beevidence adduced with respect to the defendant for which the extension of time to serve is sought. Accordingly, I conclude that there isno exception relieving a plaintiff in cases with multiple defendants from the obligation to adduce evidence concerning each defendant. Delay/Stalling Tactic [18] The application to extend time for service of the Statement of Claim in this case was not a stalling tactic. The evidenceprovided to Master Farrington indicated that there were legitimate service issues with respect to some of the other defendants locatedoutside Canada.

And nothing in this action was realistically going to take place until after all defendants had been served. Accordingly,the extension of time for service for the Bristol-Myers Defendants did not hamper the progress of the proceeding in any way.

Prejudice to the Bristol-Myers Defendants [19] Master Prowse, as he then was, explained in 681210 Alberta Ltd v 1335422 Alberta Ltd, 2015 ABQB 11 at para 23 that “[t]hefact that time for service would have expired but for the [Rule 3.26] extension order is not considered prejudice to the defendant from thegranting of the order.” As discussed below in para 47, the added factor of the expiry of a limitation period may constitute prejudice. [20] Prejudice comes in different forms. In cases of long delay, sometimes Courts find prejudice on the grounds that witnessmemories have faded.

Prejudice in this case could be that during the period between the expiry of the time for service of the statement ofclaim and the time that service under the extension order occurred the Bristol-Myers Defendants somehow changed their position to theirdetriment in reliance on not being served. Prejudice might also arise if something had occurred between the expiry of time for serviceand service under the extension order that would impair the Bristol-Myers Defendants’ ability to defend the case such as the loss of keydocuments. Nothing like that occurred here.

Master Farrington observed that there was no prejudice to the Bristol-Myers Defendants.When asked in oral argument on this appeal, counsel for the Bristol-Myers Defendants was unable to point to any evidence of prejudice. [21] Justice Read in Sanderson Estate v Potter, 2012 ABQB 593 at para 46 considering the question of prejudice in the context ofa Rule 3.27 application adopted Laskin JA’s approach in Chiarelli et al v Wiens, (ON CA): First, the Court should not extend the time for service if to do so would prejudice the defendant.

Second, the plaintiff bears the onus ofdemonstrating that the defendant would not be prejudiced by an extension. Third, the defendant has at least an evidentiary obligation toprovide some details of prejudice which would flow from an extension of the time for service. In the face of a general allegationof prejudice, the plaintiffs cannot be expected to speculate on what witnesses or records might be relevant to the defence and thenattempt to show that these witnesses and records are still available or that their unavailability will not cause prejudice. Fourth, the

defendant cannot create prejudice by its failure to do something that it reasonably could have or ought to have done. Lastly, prejudice that will defeat an extension of time for service must be caused by the delay. [ 22 ] Laskin JA’s approach is equally applicable to Rule 3.26. In the present case, the Representative Plaintiffs have no knowledge as to what prejudice the Bristol-Myers Defendants might have suffered. However, given the short period of time involved, it may be inferred that there was no prejudice.

Such a conclusion is supported by the fact that the affidavit submitted on behalf of the Bristol- Myers Defendants, sworn by a legal assistant at DLA Piper, speaks only to corporate searches and the dates on which the Bristol-Myers Defendants were served.

The Bristol-Myers Defendants have not adduced any evidence of prejudice and, thus, are unable to meet their “evidentiary obligation to provide at least some details of prejudice which would flow from an extension of the time for service.” Representative Plaintiffs’ Reliance Argument [ 23 ] The Representative Plaintiffs submit in their written brief that it is the Court’s fault that they find themselves in the current predicament.

The Representative Plaintiffs contend as follows: The Plaintiffs sought the order for extension of time with several weeks left to serve, and relied upon the fact that the extension had been granted in conducting itself as it did. It would not be fair for the court to invalidate the extension at this time.

The argument shares many parallels with the concept of estoppel – the court made a representation that the Plaintiff did not have to comply with the strict deadlines set out in the rules, and the Plaintiffs relied on that representation, to their detriment [emphasis added]. [ 24 ] This argument reflects a misunderstanding of the Court’s role and process. On an ex parte Rule 3.26 application the Court receives the evidence and representations of the applicant.

If the applicant appears to satisfy the requirements of Rule 3.26, the Court may exercise its discretion to grant a three-month extension of the time to serve a statement of claim. An order granted on an ex parte basis is always at risk of being challenged once it becomes known to the other side, and it may be varied or set aside in an application pursuant to Rule 9.15. This is a basic point of procedure; accordingly, a party cannot rely on a Court’s ex parte order to its detriment. An ex parte order is only as good as the foundation provided by the applicant.

If an ex parte order is later set aside by the Court, an applicant has only itself to blame. Dyson LJ of the English Court of Appeal, considering a similar argument in Hoddinott & Ors v Persimmon Homes (Wessex) Ltd , [2007] EWCA Civ 1203 at para 50, observed that “ if a claimant applies for and obtains an extension of time for service of the claim form without giving notice to the defendant, he does so at his peril. He should know that an order obtained in such circumstances may be set aside. He can take no comfort from the fact that the court has made the order.

He cannot be heard subsequently to say that it was the court’s fault that the order was made. ” A Public Interest Exception? [ 25 ] The Representative Plaintiffs argue that the present action engages the public interest and that the importance of the litigation justifies a departure from the normal rules. Essentially, the Representative Plaintiffs assert that there should be a public interest exception that operates to absolve plaintiffs of litigation missteps when the defendants are corporations alleged to have harmed society.

The Representative Plaintiffs submitted in their brief: The interests at stake in this litigation are enormous. This is one of the largest class actions in Canadian history, and in the event that the Plaintiffs are successful, municipalities will be able to use the money from their judgment to mitigate the harms associated with the opioid crisis. Because the effects of the opioid crisis are so serious – they are literally life and death – so too are the stakes of this application. It is no exaggeration to say that the stakes could not be higher.

Further, if this order is set aside, and these major corporations are not held to account on the merits of this action, this would have a strong possibility of bringing the administration of justice into disrepute. Canadians have a right to expect that large multinational corporations will be held to account for their actions in causing a public health crisis. [ 26 ] Class actions, like the present case, engage aspects of the public interest. There is no doubt that the subject matter of the present case is of particular significance to the public.

However, Kasirer J in Canada (Transportation Safety Board) v Carroll-Byrne , 2022 SCC 48 at para 99 explained that “[t]he public interest in the administration of justice and a fair trial is not materially different in a class action….” Côté J, writing for herself and Brown J, dissenting but not on this point, added at para 164 that “ the public interest in the administration of justice is the same in class actions as it is in other civil proceedings.” [ 27 ] The rule of law requires that the Court apply rules consistently and treat like cases alike.

There is no special set of rules – favourable or unfavourable – for cases involving, as the Representative Plaintiffs put it, “major corporations.” Contrary to the submission of the Representative Plaintiffs, the reputation of the administration of justice is best served by the consistent application of the law. A Solicitor’s Negligence Exception?

Was it Negligent to Not Serve the Statements of Claim in the One Year Period? [ 28 ] Conrad JA observed in Oberg at para 16 that “[t]here is no need to serve earlier than the one-year limitation….” However, the lawyer who waits until the last day to serve a statement of claim is tempting fate. The Court of Appeal in McGowan v Lang , 2015 ABCA 217 at para 35 offered sage advice: “The “takeaway” from this appeal is simply this. A lawyer acting for a plaintiff ought to file the statement of claim in a timely fashion and thereafter proceed to effect service of the statement of claim upon the defendant(

s) as expeditiously as possible.” [ 29 ] Serving the Bristol-Myers Defendants was not a daunting task. The addresses for service can be obtained from routine

corporate searches. The Canadian entities operating in Alberta could have been served by registered mail (Rule 11.9(1)(b)) and the USentity could have been served in accordance with the Hague Convention

Article 10(c) (service is permitted by process server); neither isdifficult. The Representative Plaintiffs’ counsel’s failure to serve the Bristol-Myers Defendants within the one-year period for serving astatement of claim when it was easy to do is negligent unless there were extenuating circumstances. [30] The Representative Plaintiffs assert that the COVID-19 pandemic is an extenuating circumstance that explains the failure toserve the Statement of Claim within 12-months and justifies a 3-month extension of time for service.

The assertion that the COVID-19pandemic affected the Representative Plaintiffs’ ability to serve defendants is just that, an assertion. There is no evidence supporting theposition. Was registered mail service suspended for the duration of the 12-month period for service? There is no evidence of that. Perhaps for a period early in the COVID-19 pandemic it may have been difficult to get a process server in the US, but again there is noevidence on this point and certainly nothing that would support a conclusion that a process server could not be engaged during the wholeperiod from June 2020 to June 2021.

The evidence before the Court discloses no extenuating circumstances, so the only conclusionavailable to me is that the failure to serve was caused by solicitor negligence. Solicitor’s Negligence and Rule 3.27 [31] Solicitor’s negligence as a justification for exercising discretion to permit a three-month extension of the time to serve astatement of claim under Rule 3.26 has not been considered by a court.

The issue of solicitor’s negligence has, however, been consideredmany times by Alberta courts in the context of applications to extend time for service of commencement documents pursuant to Rule3.27 and its predecessor, Rule 11, and Rule 11’s predecessor, Rule 15.

The following discussion shows that the courts in Alberta havenot taken a consistent approach to the treatment of solicitor’s negligence in the context of applications to extend time for service ofcommencement documents. [32] McDermid JA, writing for himself and Cairns JA, in Cook v Szott, (1968) (AB CA), 68 DLR (2d) 723 (ABSup Ct, Appellate Division) considered a circumstance where a solicitor failed to serve a statement of claim within the required time in amotor vehicle injury action by reason of “ignorance, neglect or oversight.” An application pursuant to Rule 15 to extend the time forservice was made more than two years after the expiry of the time for service.

McDermid JA for the majority and Porter JA dissentingagreed that for the Court to exercise its discretion to extend the time for service there must be “special circumstances.” McDermid JAadopted Lord Reid’s reasoning in Rondel v Worsley, [1967] 3 All E.R. 993 at 998: the Rules of Court by providing that a statement of claim is only in force for 12 months unless renewed, manifests the intention thatlitigation shall not be unduly delayed. The Legislature by providing that automobile actions must be commenced within such a period asshort as a year confirms that intention.

As the renewal of a statement of claim runs counter to declared public policy [that claims bebrought within a specified time] the power of renewal should be used sparingly. Just as a patient must bear the mistakes of his doctor, somust the litigant, the mistakes of his solicitor.

In each case where there is negligence the party injured has an action for damages againstthe defaulter. [33] McDermid JA declined to follow Simpson v Saskatchewan Government Insurance Office (1967), (SKCA), 65 DLR (2d) 324 (SKCA) where the Court held that the question that should be asked when considering whether to extend the timefor service after the time for service has expired is whether there has been “substantial injustice.” The Court in Simpson held that asubstantial injustice would occur if the Court did not grant an extension of time for service where there had been a solicitor’s slip and theapplication to extend was made promptly.

Porter JA dissented in Cook v Szott saying that he would adopt the approach set out inSimpson. At page 727 he explained: Here there is no misconduct on the part of the plaintiff. Here there is no prejudice to the defendants. These facts constitute the veryspecial circumstances in which under the rule leave may be given.

To refuse to extend the time in these circumstances would be to denyelementary justice to the plaintiff and to give the defendants a fortuitous final answer to the plaintiff’s claim regardless of the merits. [34] Some decisions in the years following Cook v Szott took McDermid JA’s decision as establishing a rule that where the onlyground for an extension of time for serving a statement of claim is solicitor’s negligence, the application must be denied: see, forexample, Colborne v Pollock, 1975 CarswellAlta 215, [1975] WWD 149 (AB Sup Ct, Trial Division) at para 10.

Other decisions reflectdiscomfort with the hard line taken by McDermid JA. Laycraft J, as he then was, in Wright v Disposal Services Limited & Marsh, (AB Sup Ct, Trial Division) at para 28, concluded that an “absolute prohibition” in the case of solicitor’s negligence wouldbe “anomalous” because, in various other contexts under the Rules of Court, the Court has the power to relieve litigants from theconsequences of solicitor’s negligence causing delay.

He proceeded to exercise his discretion under Rule 11 at para 30 “conclud[ing] thatthe interests of justice require that this statement of claim be renewed.” Laycraft J’s approach was followed by Miller J in Cherry &Cherry v Hurtig, (1981), 26 AR 483 (QB). Justice Belzil, writing for the Court in Widdell v Woodman, 1983 ABCA 97 at paras 4-5,accepted that solicitor’s negligence could be a justification for extending time for service of a statement of claim under Rule 11 andadopted Laycraft J’s approach in Wright. [35] Rule 3.27(1)(

c) provides that the Court may grant an extension of time for service where “special or extraordinarycircumstances exist resulting solely from the defendant’s conduct or from the conduct of a person who is not a party to the action”[emphasis added]. The concept of “special or extraordinary circumstances” is drawn from case law that goes back at least as far as Cookv Szott.

The phrase “special circumstances” is also used in connection with applications to extend time for commencing an appeal.Justice Slatter, considering the question of special circumstances on an application to extend time for filing a notice of appeal, observedthat “[t]here is no rigid rule that an error by counsel is not a sufficient explanation”: Attila Dogan Construction and Installation Co Incv AMEC Americas Limited, 2015 ABCA 206 at para 7. [36] The first significant consideration of Rule 3.27 by the Court of Appeal occurred in Nixon v Timms, 2013 ABCA 84.

Thequestion in Nixon was whether Rule 3.27 could be used to revive a claim that had expired under former Rule 11. At para 10, the Court ofAppeal outlined general principles to be considered in Rule 3.27 cases: We do not accept that the drafters of R. 3.27 intended this broad a discretion or the perpetual ability to renew expired claims. We note,

however, that in considering whether extraordinary circumstances exist in a given case or whether to exercise a discretion under the rule,regard must be had to the policy considerations in the Limitations Act, RSA 2000, c. L-12 and any prejudice arising as a result of theexpiration of a particular limitation period. [37] Yungwirth J in McGowan v Lang, 2014 ABQB 403 at para 49 interpreted the preceding paragraph from Nixon.

Sheconcluded: The Alberta Court of Appeal cannot, by this statement, have intended that extensions for service of a statement of claim under Rule 3.27should be permitted in circumstances where the failure to serve is caused by Plaintiff’s counsel’s inadvertence – even in those caseswhere there is no demonstrated prejudice to the defendant were the extension allowed. [38] The majority of the Court of Appeal in McGowan v Lang, 2015 ABCA 217 at paras 28-29 found Yungwirth J’s conclusionthat “an extension for service of a statement of claim under Rule 3.27 should not be permitted in the circumstances where the failure toserve is caused by the plaintiff’s lawyer’s inadvertence, even in situations where there is no demonstrated prejudice to the defendants” tobe reasonable and dismissed the appeal.

The Court of Appeal’s decision in McGowan v Lang has been understood by this Court to standfor the proposition that solicitor’s negligence cannot be a special circumstance for the purpose of Rule 3.27: Ball v 1979927 Alberta Ltd,2022 ABKB 814 at para 54. [39] The holding in McGowan v Lang that solicitor’s negligence in failing to serve a statement of claim cannot be “specialcircumstances” for the purpose of Rule 3.27 is difficult to reconcile with the conclusion in Stremich v Pefanis, 2017 ABCA 383 that thenegligence of a process server in failing to serve a statement of claim can be “special circumstances” for the purpose of Rule 3.27. [40] The Ontario Court of Appeal in Chiarelli v Wiens at para 9 expressed the view that, when considering whether to extend thetime for service of a statement of claim, “the court should be concerned mainly with the rights of litigants, not with the conduct ofcounsel.” Similarly, the BC Court of Appeal in Fast Fuel Services Ltd v Michelin North America (Canada) Inc, 2008 BCCA 216 atpara 9 explained that the relevant question is “whether the plaintiff, as opposed to its solicitors, was at fault.” In neither province does thefailure to serve a statement of claim within the prescribed time for the sole reason of solicitor’s negligence preclude the Court fromgranting an extension.

The courts of many other Canadian provinces take a similar approach: see, for example, Kilbach v McCredieEstate, (SK CA); Rohl v Portage la Prairie Mutual Insurance Company, 2000 MBQB 17; Binkley and Binkley vBajcura et al, (MB CA); LeBlanc v St Coeur and St Coeur, 2007 NBCA 32; Grosse v White, 2010 NSSC 10 at para30; Croucher v Newfoundland and Labrador Housing Corp (1990), at para 15 (NL SC), cited recently withapproval in Hunt v Pardy, 2011 NLTD 160at para 26.

Solicitor’s Negligence and Rule 3.26 [41] Given that McGowan v Lang was decided under Rule 3.27, there is no provision in Rule 3.26 analogous to the requirementfor “special circumstances”, and Westwinds was clear that the general principles to be followed when exercising discretion under Rule3.26 are non-exhaustive, I am not precluded from taking solicitor’s negligence into account in exercising my discretion to set aside or notset aside service of the Statement of Claim on the Bristol-Myers Defendants. [42] The idea that an action for solicitor’s negligence is an adequate and appropriate remedy for a plaintiff whose statement ofclaim has not been served within the prescribed period is seen in Lord Reid’s passage from Rondel v Worsely quoted by McDermid JAin Cook v Szott and in the oral submissions of counsel for the Bristol-Myers Defendants in the present case.

I suspect that this idea isimplicit in many of the cases that take a hard line refusing to extend time for service of commencement documents in cases of solicitor’snegligence. Miller J in Cherry at para 23 expressed his disagreement with this line of thinking: I find it very difficult to see that the ends of justice, at least in the minds of the general public, are served by the possibility that theblameless litigant, who has lost his right of action due to the inadvertence or negligence of his solicitor, will be ultimately satisfied bypursuing a claim against his solicitor.

Not only is this small comfort to the innocent party, who is compelled to go to the trouble andexpense of a brand new lawsuit based on entirely different legal problems, but it will, in my opinion, inevitably lower the public’s respectfor a system which would cause such a result. [43] While I generally share Miller J’s view, I am not prepared to dismiss the possibility that in some cases an action for solicitor’snegligence may be an adequate and appropriate remedy. [44] An action for solicitor’s negligence is not an adequate or appropriate remedy in the present case.

The most recent amendmentto the Statement of Claim runs to 796 paragraphs. The claim seeks an estimated $10 billion for a range of causes of action includingconspiracy, fraud, negligence, negligent misrepresentation, public nuisance, and unjust enrichment. The remedies sought include bothdamages and gain-based remedies including restitution and disgorgement of profits.

To succeed in an action for solicitor’s negligence,the Representative Plaintiffs would have to prove that the Bristol-Myers Defendants would have been liable in the present case and whatwould have been awarded in terms of damages or gain-based remedies. Such an action would require the Representative Plaintiffs toobtain third-party discovery of the Bristol-Myers Defendants, including the Bristol-Myers entity in the US, and the attendance of hostilenon-party witnesses at trial.

Given the scale of the claims and issues in the present case, litigating a separate solicitor’s negligence casewith the Bristol-Myers Defendants involved would be impractical and uneconomic. To say that a solicitor’s negligence claim is a remedyto the matters now before the Court is to say that there is no remedy at all. [45] A partial answer to this conundrum is that a new claim may be commenced by the Representative Plaintiffs against theBristol-Myers Defendants which then may be consolidated with the existing class proceeding.

I emphasize that this is only a partialanswer as some limitations may have passed which may alter the scope of discovery or quantum that may be recovered by way ofdamages or gain-based remedies. The commencement of a new proceeding against the Bristol-Myers Defendants followed by anapplication to consolidate it with the present case may cause delays in prosecution. Any shortfalls caused by the expiry of limitationswould have to be addressed through a solicitor’s negligence claim, which I have explained, is unlikely to be litigated.

[ 46 ] Rule 1.2 states the purpose and intention of the Rules of Court ; specifically, Rule 1.2 says that the Rules of Court “provide a means by which claims can be fairly and justly resolved in or by a Court process in a timely and cost-effective way.” Rule 1.2(3)(

d) directs the Court’s attention to the effective use of publicly-funded Court resources. Exercising my discretion in the present case to set aside service of the Statement of Claim on the Bristol-Myers Defendants may cause a proliferation of actions and complicate and delay the existing class action. Such a decision would neither advance the fair and just resolution of the present dispute in a timely and cost- effective way nor would it be an effective use of publicly-funded Court resources.

Limitations Considerations [ 47 ] I am mindful of what the Court of Appeal in Nixon at para 10 described in the context of Rule 3.27 as “the policy considerations in the Limitations Act , RSA 2000, c. L-12 and any prejudice arising as a result of the expiration of a particular limitation period.” Limitations Act s 6(3) and (4) concern adding claims to existing proceedings and adding parties to existing proceedings. Those situations are analogous in some respects to the circumstances of the present case.

The Court of Appeal considered an application where the original claimed named “John Doe” and later the identity of John Doe was discovered in Anglin v Pankiw, 2022 ABCA 362 . The Court explained at para 11 that for the various sections of the Rules of Court that concern adding or identifying a plaintiff “the test generally comes down to whether there is an absence of prejudice that cannot be remedied.” The Court then went on to consider Limitations Act s 6(4).

Section 6(4) prescribes a slightly different test than the Rules of Court which may be summarized as follows: (1) the claim must be related to the original proceeding; (2) the new party must have knowledge of the claim within the limitation period; and (3) the new party will not be prejudiced in maintaining a defence on the merits. The second part of the s 6(4) test, knowledge within the limitation period, is not prominent feature in the case law concerning extensions of time for service of commencement documents.

I leave the question of the correct test open for another case where the facts require the Court to decide the matter. [ 48 ] The facts of the present case obviate the need for applying the test in the Limitations Act ss 6(3) and (4) or a modified version of the test adapted to the circumstances of an extension of time for service. As noted previously, the Bristol-Myers Defendants did not adduce any evidence of prejudice. Without evidence, it is impossible to assess whether any limitations issues exist.

I should add that the Bristol-Myers Defendants also did not articulate any limitations issues in their written submissions. Counsel for the Bristol-Myers Defendants speculated in oral argument, as I have in para 45, that the passage of time and the application of the Limitations Act might alter the parameters of the claim, but that is not evidence of prejudice and is not a basis on which I may reverse Master Farrington’s decision.

Conclusion [ 49 ] The Representative Plaintiffs provided evidence of the difficulties of serving many of the defendants, but they failed to provide evidence of difficulty in serving the Bristol-Myers Defendants specifically. Despite this lack of evidence, I conclude that solicitor negligence led to the failure to serve the Bristol-Myers Defendants within the specified year.

The ability of the Plaintiffs to have their claim adjudicated on the merits should not be precluded by solicitor negligence, especially given there is no evidence that the delay will prejudice the Bristol-Myers Defendants. [ 50 ] The appeal of Master Farrington’s decision not to set aside his ex parte order extending time for service of the Statement of Claim is dismissed. If the parties are unable to agree on costs, they may make written submissions of a maximum of five pages supported by a proposed bill of costs. Heard on the 2 nd day of February, 2023.

Dated at Calgary, Alberta this 10 th day of February, 2023. Colin C.J. Feasby J.C.K.B.A. Appearances: Heather Treacy, KC, Rebecca von Ruti, David Neave, and Victoria C. Lee for the Appellants Clint Docken, KC and Casey Churko for the Respondents