DW EARNSHAW EXCAVATING APPLICANT - v. -, 2023 SKKB 252

KING’S BENCH FOR SASKATCHEWAN Citation: 2023 SKKB 252 Date: 20 23 11 27 Docket: QBG-ES-00060-2018 Judicial Centre: Estevan BETWEEN: DW EARNSHAW EXCAVATING APPLICANT - and - 7-ELEVEN CANADA INC, BLS ASPHALT INC., CORMODE & DICKSON CONSTRUCTION (OKANAGAN) LTD., HASTING ENTERPRISES LTD., ROMANA EXPRESS INC., WEYTERRA DEVELOPMENT GP INC., NT EXCAVATING LTD., and TURNBULL EXCAVATING LTD. RESPONDENTS Counsel: Elaine N. Selensky for the applicant Craig Brusnyk for respondent 7-Eleven Canada Inc. Michael Scott for respondent BLS Asphalt Inc.

Scott Moffat for respondents Hastings Enterprises Ltd., NT Excavating Ltd., and Turnbull Excavating Ltd. No one appearing for Cormode & Dickson Construction (Okanagan) Ltd., Romana Express Inc., and Weyterra Development GP Inc. JUDGMENT BERGBUSCH J.

November 27, 202 3 INTRODUCTION [ 1 ] This court application considers whether s. 56(9) of The Builders’ Lien Act , SS 1984-85-86, c B-7.1 [ BLA ], provides authority for the court to resolve lien claims summarily. [ 2 ] In 2019, 7-Eleven Canada Inc. [Owner] paid $59,903.00 plus GST into court in accordance with an order [Order] of this Court made pursuant to s. 56(2) of the BLA .

The Order limited the Owner’s liability to the affected lien claimants to the amount paid into court and discharged their claims of lien from the Owner’s title: 7-Eleven Canada Inc. v BLS Asphalt Inc. , 2019 SKQB 246 [ 7-Eleven v BLS ], affirmed Hastings Enterprises Ltd. v 7-Eleven Canada Inc ., 2021 SKCA 70 , [2021] 8 WWR 51, [ Hastings v 7- Eleven ].

By operation of law, the liens became a charge on the amount paid into court in place of the title against which they had been registered. [ 3 ] The affected lien claimants were subcontractors retained by a general contractor, Cormode & Dickson Construction (Okanagan) Ltd. [Contractor], to provide services and materials for the construction of a convenience store in Weyburn, Saskatchewan [Project]. They have asserted claims for non-payment totalling $242,005.74, and seek to recover the amounts owed to them from the funds in court and through contractual claims against the Contractor.

As a result of the Order, payment of the funds in

court would extinguish the Owner’s liability to the lien claimants, but they would remain free to prosecute their claims against the Contractor for the unpaid balances owed to them. [ 4 ] One of the lien claimants, the applicant DW Earnshaw Excavating [Earnshaw], has applied for an order for payment of funds out of court, relying on s. 56(9) of the BLA . Earnshaw proposes that the funds be paid out on a pro rata basis to all lien claimants holding valid lien claims. Earnshaw requests that this Court provide directions concerning the process to be followed for the lien claimants to prove their lien claims.

Other lien claimants assert that the court file already contains sufficient evidence establishing the validity and amount of the lien claims, and the order for payment out of court should be granted without further proof or procedural steps. [ 5 ] The amount of the funds in court is small and the BLA directs that, as far as possible, procedure is to be

summary in character to further the enforcement of liens at least expense: s. 91(1) of the BLA . Nonetheless, I am unable to grant the order sought for several reasons. [ 6 ] First, s. 56(9) of the BLA does not apply to the present circumstance. Subsection 56(9) applies to the circumstance where a “…lien claimant whose registered claim of lien or written notice of a lien has been vacated is not able to prove his claim …” [Emphasis added]. That is precisely not the position advanced by Earnshaw and the other respondent lien claimants.

They seek a court order confirming that their lien claims have been proved. [ 7 ] Second, the relief sought by Earnshaw and some of the other lien claimants can only be granted after the court has determined which persons are entitled to the money and what their proportionate share is.

Part VIII of the BLA establishes the procedure by which the lien claimants may enforce their claims against the amount paid into court. As permitted by s. 86 of the BLA , BLS Asphalt Inc. [BLS] commenced this action to enforce its lien claim by statement of claim, and the other lien claimants named as defendants in the statement of claim asserted crossclaims against the Owner and the Contractor. Except as modified by specific provisions of

Part VIII of the BLA , The King’s Bench Rules apply to this litigation. Thus, by way of example, the lien claimants, including Earnshaw, could apply for

summary judgment pursuant to Rule 7-2 of The King’s Bench Rules . To date, none of the lien claimants have made such an application and only Earnshaw has adduced evidence of the amount it is owed by the Contractor for services and materials supplied to the Project. [ 8 ] Third, even if the application had been properly developed, I would have dismissed or adjourned it because Earnshaw did not attempt service on the Contractor following The King’s Bench Rules . Contrary to what was argued, the Contractor has a direct interest in the outcome of the application.

Moreover, if my view of s. 56(9) of the BLA is wrong and it can be used by the lien claimants to validate their claims, that subsection requires notice to all persons affected, which has not been given. [ 9 ] Since the Contractor did not receive notice of the application, I am also not able to determine Earnshaw’s application, in the alternative, for an extension of time to set the action down for trial pursuant to s. 55(2) of the BLA . I note that the Owner does not object to this relief and an extension of time would likely benefit all other parties, including the Contractor.

Despite this, the application should not proceed in the Contractor’s absence without proof of service. [ 10 ] Accordingly, I have determined that Earnshaw’s application for payment of funds out of court must be dismissed, without prejudice to the lien claimants’ entitlement to bring further applications, supported by evidence to validate their lien claims, on notice to all parties to this action. The application for an extension of time is adjourned. FACTUAL BACKGROUND [ 11 ] A

summary of the history of this proceeding may be found in Hastings v 7-Eleven at paras 4-9. A brief review of the proceedings to date is necessary to explain the context for my decision. [ 12 ] On November 29, 2016, the Owner determined that the Project had been substantially completed.

The Owner paid most of the outstanding amounts owing to the Contractor on March 29, 2017, leaving only $59,903.00 owing to the Contractor for change orders. [ 13 ] The lien claimants who are parties in this proceeding registered claims of lien against title to the Owner’s property between April 26, 2017, and August 30, 2018. [ 14 ] BLS issued the statement of claim in this matter on September 26, 2017.

BLS claimed against the Owner as the registered owner of property to which BLS provided an improvement, and against Cormode & Dickson Construction (SK) Ltd. [Cormode (SK)] for non-payment of the balance owing on an account dated October 31, 2016, for the supply of asphalt products to the Project. [ 15 ] At para. 2 of the statement of claim, Cormode (SK) was identified as a “body corporate extra-provincially [ sic ] in the City of Saskatoon, in the Province of Saskatchewan”.

On December 8, 2017, BLS amended the statement of claim by replacing Cormode (SK) with the Contractor, described as a “body corporate with its registered office in the City of Edmonton, in the Province of Alberta”. [ 16 ] On January 24, 2018, the Contractor filed a brief statement of defence, denying the debt claimed by BLS. [ 17 ] Statements of defence were filed by each of Weyterra Development GP Inc. [Weyterra], Romana Express Inc. [Romana], NT Excavating Ltd. [NT], and Hastings Enterprises Ltd. [Hastings]. [ 18 ] Each statement of defence included a crossclaim against the Contractor and the Owner, claiming in debt against the Contractor and asserting entitlement to a builders’ lien against the property of the Owner.

Against both the Owner and the Contractor, Weyterra also asserted breaches of the statutory trust provisions in the BLA and a claim for unjust enrichment.

[ 19 ] The Owner filed statements of defence to the crossclaims against it, referring to Cormode (SK) in the style of cause. This included a defence to a crossclaim of Turnbull Excavating Ltd. [Turnbull]. Accordingly, Turnbull must have served a statement of defence and crossclaim, but none appears on the court file. [ 20 ] On September 17, 2018, Earnshaw applied to be added as a defendant to the action. The order was granted on October 1, 2018, and Earnshaw filed a statement of defence and crossclaim shortly thereafter. [ 21 ] The Contractor filed statements of defence to all crossclaims on November 23, 2018.

At the same time, the Contractor’s counsel filed a notice of withdrawal of lawyer of record, giving the last known address of the Contractor as “200, 11450 160 Street, Edmonton. AB. T5M 3Y7, Attn: Michael Deacon”. The Contractor’s counsel also filed a notice of withdrawal of lawyer – client, supported by an affidavit of service by registered mail at its former client’s address and confirmation of receipt. [ 22 ] On January 16, 2019, all parties save for the Contractor attended mandatory mediation.

A certificate of non- compliance for the Contractor was filed with the court pursuant to s. 42(3) of The Queen’s Bench Act, 1998, SS 1998, c Q-1.01 (since rep). [ 23 ] On March 18, 2019, the Owner applied for an order pursuant to s. 56(2) of the BLA vacating the claims of lien from title to its property upon payment into court of the amount of $59,903.00. The Owner’s application and supporting materials all referred erroneously to Cormode (SK). [ 24 ] On May 27, 2019, on the application of Hastings, Justice Chicoine extended the time for setting the matter down for trial by one year to June 1, 2020.

Subsequently, as noted above, Chicoine J. allowed the Owner’s application thereby limiting the Owner’s liability to the lien claimants to the amount of $59,903.00: 7-Eleven v BLS . The Owner paid $59,903.00 plus GST for a total of $62,898.15 into court. [ 25 ] An appeal from the Order was dismissed by the Court of Appeal on April 29, 2021: Hastings v 7-Eleven . [ 26 ] On June 16, 2021, Earnshaw filed a notice of change of representation.

The affidavit of service indicated that service by registered mail on Cormode (SK), at an address provided by the Owner’s counsel, had been unsuccessful. [ 27 ] The Order was amended on June 22, 2021, to correct the date on which Earnshaw had registered its claim of lien. [ 28 ] The present application by Earnshaw repeats the clerical error of referring to Cormode (SK) in the notice of application.

The affidavit of service states that Romana was served by registered mail at its registered office, being 1535 Victoria Avenue, Regina, while service by registered mail on Cormode (SK) at the registered office shown on its profile report, being 17707 – 105 Avenue NW, Edmonton, Alberta, was unsuccessful. Evidence confirming the registered offices of the corporations was not adduced. [ 29 ] Earnshaw also filed an affidavit of service of its brief of law.

In this instance, the affidavit of service states that service on Romana was attempted by sending a copy by registered mail to 4529 Padwick Crescent, Regina, Saskatchewan, S4W 0C5, “the address that was on their profile report”. The registered mail was returned, with the envelope indicating that Romana had moved. No evidence of an attempt to serve the Contractor with Earnshaw’s brief of law was filed. [ 30 ] Earnshaw filed a draft consent order endorsed by counsel for BLS, the Owner, and Weyterra.

Counsel for NT, Hastings, and Turnbull together, [the Hastings Defendants] advised that his clients consented to the order, save for common carriage costs sought by Earnshaw. [ 31 ] On June 16, 2023, former counsel for the Contractor wrote to the court advising that, while their firm’s name appeared on the chambers list, they had not been served with the application and did not intend to appear. ISSUES [ 32 ] Earnshaw’s application raises the following issues: (

a) Does s. 56(9) of the BLA authorize the court to determine the validity of lien claims and order payment out of court? (

b) Is service of the application on the Contractor required? (

c) Should the time for setting this matter down for trial be extended? (

d) Is Earnshaw entitled to common carriage costs? DISCUSSION Does s. 56(9) of the BLA authorize the court to determine the validity of lien claims and order payment out of court? [ 33 ] As noted above, the Owner paid the funds into court in accordance with an order made pursuant to s. 56(2) of the BLA . Subsection 56(7) identifies how lien claimants may prosecute their claims against the amount paid into court or security posted by the owner: 56 …

(7) Where an order is made under subsection (1) or (2), the lien claimant whose registered claim of lien or written notice of a lien has been vacated may proceed with an action to enforce his claim against the amount paid into court or security posted in accordance with the procedures set out in

Part VIII , but no certificate of action with respect to that action shall be registered against the land.

[Emphasis added] [34] Earnshaw brought this application in purported reliance on s. 56(9) of the BLA. Subsection 56(9) reads: 56 …

(9) Where a lien claimant whose registered claim of lien or written notice of a lien has been vacated is not able to prove his claim,the court, may on notice to persons affected, order that the money be paid out or security be delivered to the person found by the court tobe entitled to the money or security. [Emphasis added] [35] I emphasize that s. 56(9) applies to the circumstance where a lien claimant “is not able to prove his claim”.

SinceEarnshaw, supported by other lien claimants, seeks to have the validity of the lien claims confirmed summarily so that a pro ratadistribution of the funds in court may take place, I am unable to see how s. 56(9) assists. I read s. 56(9) as conferring a limited authorityon the court to make an order for payment out of court to the person entitled to return of the funds or to other lien claimants who haveproven their claims where a lien claimant has been unable to prove its claim. [36] Earnshaw cited Prestige Commercial Interiors

(1992) Ltd. v Prairie Green Restaurant (Southland) Holdings Limited, 2018 SKQB 93 at para 4, 87 CLR (4th) 6 as authority for proceeding in this way. That decision of Justice McMurtry notes anearlier order of Justice Krogan for payment of funds out of court to 16 lienholders: [4] On June 19, 2014, Prairie Green applied to vacate these liens. Pursuant to an order of Elson J. dated June 19, 2014, PrairieGreen paid $400,000 into court and these liens were vacated. One year later, on June 16, 2015, Krogan J. ordered payment out of court of$174,003.64, of the $400,000 paid in by Prairie Green.

The $174,003.64 was distributed to 16 lienholders; … [37] Understandably, since she provided this information for context, McMurtry J. did not explain the circumstancesof the order made by Krogan J., including the statutory provision relied upon, whether the lien claims were contested, and so on. Thus,this paragraph offers no support to the applicant.

Counsel have not cited any decision to me, and I have not located any, in which lienclaimants applied successfully for payment out of court in reliance on s. 56(9) of the BLA. [38] In my view, s. 56(9) does not provide a mechanism for the court to determine the validity of lien claims. Rather,as explained by Cameron J.A. in Town-N-Country Plumbing & Heating

(1985) Ltd. v Schmidt (1991), (SK CA), 93Sask R 278 (CA) at paras 74-76, s. 56(8) and (9) establish priority to the funds paid into court: [74] Turning to the language of s. 56(8), it will be noted that, while the subsection provides that the money paid into court "is subjectto the claims of all lien claimants", it goes on to provide that "such amount as is found owing to any lien claimant whose registered claimof lien or written notice of a lien claim has been vacated … is a first charge on the money …" [75] Now it is open to a lien claimant to both serve notice of, and register, his claim of lien.

If he does so and the amount of his claimis afterwards paid into court, each of the notice and the registration will be vacated. And his lien, as it affects both the additional amountowed and the land, will thereby be discharged, becoming instead a charge on the amount paid into court. In such case, the effect of ss.56(8) and (9) is to give the lien claimant a first charge on that amount to the extent he can establish the validity of his claim and theamount secured by the discharged lien.

To the extent he is unable to so establish his claim, the amount paid is available to satisfy the lienclaims of others. [76] These, of course, are essentially priority provisions, provisions which confer upon a lien claimant in whose favour they operate ahigher right, in relation to an amount retained under s. 40 and paid into court under s. 56, than is conferred on other lien claimants. … [Emphasis in original] [39] The purpose of s. 56 of the BLA is summarized in W. Brent Gough & Collin K. Hirschfeld, SaskatchewanBuilders' Lien Manual, 2d ed (Regina: Law Society of Saskatchewan Library, 2014) at 93 as follows:

Section 56 provides a method of removing the effect of registered or written notice of lien, but it does not conclude the issues in disputebetween the parties. In order to achieve a final resolution, an action must be commenced and completed.

Section 56(7) authorizes a lienclaimant to litigate even though a registered lien no longer exists. [Emphasis added] [40] This explanation of the scope of s. 56 is consistent with decisions interpreting s. 56(4) of the BLA, whichprovide that this subsection can only be used to invalidate lien claims in “plain and obvious” cases: Majestic Contractors Ltd. v N.C.L.Contracting Ltd. (1993), (SK KB), 117 Sask R 12 (QB) at paras 20 & 23; Grey Owl Engineering Ltd. v Propak Systems Ltd., 2015 SKCA 108 at paras 9, 13, 33, & 36, 392 DLR (4th) 64. [41] Considering its wording and the foregoing discussion, s. 56(9) is not a shortcut for finally resolving the lienclaimants’ entitlement to the funds in court. [42] In its written submission, Earnshaw also referred to s. 91(1) and s. 96(1) of the BLA as support for the positionthat the court has broad authority to grant the requested relief on a

summary application. These provisions read: 91(1) The object of this Act being to enforce liens at the least expense, the procedure shall be as far as possible of a

summary characterhaving regard to the amount and nature of the liens in question.

… 96(1) The court may: (

a) try the action, including any set off, crossclaim, counterclaim and third party claim, and all questions that arise therein or that are necessary to be tried in order to dispose completely of the action and to adjust the rights and liabilities of the persons appearing before it; and (

b) take all accounts, make all inquiries, give all directions and do all things necessary to dispose finally of the action and all matters, questions and accounts arising therein or in the action and to adjust the rights and liabilities of, and give all necessary relief to, all parties to the action. … [ 43 ] I recognize that the objective of the BLA is to resolve lien claims summarily and at least expense and have considered the guidance provided in decisions such as RGR Enterprises Ltd. v Allsteel Builder

(2) Limited , 2012 SKQB 254 at paras 30 and 31 , 400 Sask R 150 , and Axcess Capital Partners Inc. v Allsteel Builders

(2) Limited , 2015 SKCA 33 at paras 32 and 65 , 383 DLR (4 th ) 334 . [ 44 ] Even if I were to consider Earnshaw’s application as having been brought in reliance on s. 96(1) of the BLA , I would still not be able to grant the relief sought. During the oral hearing, counsel for the Hastings Defendants submitted that the materials already before the court are sufficient to prove the amounts claimed by the defendants and no further proof is required for the court to determine each lien claimant’s proportionate share of the amount in court.

I have reviewed the file thoroughly and have been unable to locate evidence establishing the validity of any of the lien claims, with one exception. [ 45 ] In support of its application, Earnshaw filed the affidavit of Dustin Earnshaw, sworn on April 3, 2023. That affidavit summarized landscaping and excavation work performed by Earnshaw on the Owner’s property pursuant to a subcontract with the Contractor. Mr. Earnshaw averred that Earnshaw sent an invoice for services totalling $68,250.00 and had received payment in the amount of $30,712.50, leaving an unpaid balance of $37,537.50.

Earnshaw’s invoice to the Contractor was attached as an exhibit. In its written submission, Earnshaw characterizes this evidence as “uncontradicted”, but that ignores the fact that the Contractor had no notice of the application, which I will return to below. [ 46 ] The affidavit of Gary Skelton, sworn February 21, 2019, filed in support of the Owner’s application to vacate the lien claims, identified the liens registered against title to its property and the amounts claimed in the liens and asserted that the Owner did not have a contractual relationship with any of the lien claimants. Mr.

Skelton’s affidavit does not constitute evidence of the validity of the lien claims. [ 47 ] The court cannot determine the lien claimants’ pro rata entitlement to the funds in court in these circumstances. [ 48 ] Earnshaw requests the court to provide directions on how the lien claimants should proceed to prove their claims. A practical challenge here is that the amounts in dispute are small, the lien claimants comprise a class ( s. 72 of the BLA ) and the fund in court is to be distributed rateably among the members of the class ( s. 73 of the BLA ).

The Contractor has filed statements of defence to the crossclaims containing a bare denial of the debts claimed. In actions involving builders’ liens, as with other civil actions,

summary judgment may be available if there is no genuine issue requiring a trial and the judge is able to reach a fair and just determination on a

summary judgment application. Partial

summary judgment in respect of the lien claims only might also be possible if it “narrows the scope of the litigation that necessarily moves to trial”: Aero Mortgages & Investments Ltd. v Wilderness Roofing Ltd. , 2018 SKQB 268 at para 37 , 35 CPC (8 th ) 258 ; A.C. Forestry Ltd. v Big River First Nation , 2023 SKCA 96 at paras 42-44 , [2023] 10 WWR 563 . However, the parties will have to determine for themselves how best to proceed.

Is service of the application on the Contractor required? [ 49 ] Even if my view of s. 56(9) is incorrect, the application would nonetheless have to be dismissed or, at the very least, adjourned as notice was not provided to the Contractor. [ 50 ] In this case, since the Contractor and Romana were both represented by counsel, who subsequently withdrew from representation, Rule 2-41 of The King’s Bench Rules is the starting point for determining whether the application and supporting materials have been properly served on all parties.

In the case of service of Earnshaw’s notice of application and supporting materials on the Contractor, I note the following problems: (

a) Service was attempted on Cormode (SK), not a party to the litigation. (

b) Service was attempted at what appears to be an outdated registered office for the Contractor. As noted above, a recent corporate profile report for the Contractor was not exhibited to the affidavit of service. (

c) Service was not attempted at the last known address for the Contractor provided by its former solicitors. (

d) No effort was made to serve Earnshaw’s brief of law. [ 51 ] My review of this extensive court file reveals that the Contractor has not been served with any court applications or other documents since it failed to attend mediation in 2019. However, none of the parties have applied for an order striking the defences to crossclaims of the Contractor pursuant to s. 42(5) of The Queen’s Bench Act, 1998, SS 1998, c Q-1.01 (since rep) (now s. 7 - 1(10) of The King’s Bench Act , SS 2023, c 28 ).

In contrast with s. 7 - 4 of The King’s Bench Act , which compels parties to a family law proceeding to attend family dispute resolution, a party failing to attend mediation in non-family law proceedings is not prohibited from taking any further step in the proceeding. Given this, the fact that the Contractor failed to attend mediation does not excuse other parties’ failure to serve the Contractor with any subsequent documents in this action.

[52] At the hearing of this matter, I raised with counsel whether the Contractor had been properly served with theapplication. Counsel for the Hastings Defendants submitted that the court could proceed in the absence of the Contractor, given that theapplication relates only to the funds paid into court, to which the lien claimants have priority as a class pursuant to s. 72 of the BLA. Henoted that the amounts claimed by the lien claimants in aggregate total $242,005.74, which far exceeds the amount paid into court andavailable for distribution.

Further, I was advised that the lien claimants’ interest in proceeding with their contractual claims against theContractor was more theoretical than real. [53] I cannot accede to the proposition that the Contractor has no interest in the outcome of Earnshaw’s applicationor any further applications concerning the distribution of the funds in court. Although I have concluded that it does not apply, s. 56(9)requires that any order be “on notice to persons affected”. If the order is granted, any claim that the Contractor has to further payment bythe Owner will be reduced correspondingly: s. 56(10) of the BLA.

Further, the Contractor’s exposure to pay damages to the lienclaimants will also be reduced by the amounts they receive out of court. [54] More importantly, ascertaining the lien claimants’ pro rata shares of the amount in court would require adetermination of the validity and quantum of their respective lien claims. The Contractor certainly has an interest in disputing theamounts claimed by the lien claimants, as it could be found liable for any deficiency proven by the lien claimants.

So long as the lienclaimants have not abandoned their contractual claims against the Contractor, its exposure to liability is more than theoretical. [55] In 6517633 Canada Ltd. v Clews Storage Management Keho Ltd., 2020 SKQB 172, Justice Robertson provideda succinct

summary of the rationale for requiring that applications be brought on notice to persons who may be affected by an order. Ashe was considering an ex parte application, not all of his observations apply. However, I find the following comments helpful: [6] The Queen’s Bench Rules, in Rule 6-3(1), requires that “All applications must be by notice of application except whereotherwise specifically provided.” The rule then is that applications be brought with notice to persons who may be affected by theproposed order. [7] The reason for requiring notice should be self-evident.

It is generally considered unfair to determine rights or order remedieswithout hearing from persons whose rights may be affected.

Moreover, the failure to hear from both sides may result in a decision whichis not only procedurally, but also substantively, wrong since it is not fully informed. [8] The right to be heard is of ancient origin, encapsulated in the maxim audi alteram partem (the law hears before it decides).This maxim is considered fundamental to due process of law and is expressed in other maxims; for example “Quicunque aliquid stauerit,parte in aduita, altera, Aequum licit statuerit haud aequees fecerit” (He who decides anything, a party being unheard, though he shoulddecide right, does wrong.) (William T.

Hughes, The Law Restated (published by the author, 1915) at 62). Should the time for setting this matter down for trial be extended? [56] The law on this issue was recently summarized in CNS Development Inc. v Lee, 2019 SKQB 296 at paras 8 and 9, 7 CLR (5th) 103: [8] Pursuant to s. 55(1) of The Builders’ Lien Act, SS 1984-85-86, c B-7.1 [Act], where an action is not set for trial within two yearsof the day the action was commenced, a lien expires. However, in appropriate circumstances, the court has discretion to extend that timelimit pursuant to s. 55(2).

Further, an application to extend the two-year time limit can be made either before or after the lien expires.See Axcess Capital Partners Inc. v Allsteel Builders(2) Ltd., 2015 SKCA 33, 383 DLR (4th) 334 [Axcess]. [9] The test to be employed by the court on an application to extend a lien was set out in 101050094 Saskatchewan Ltd. v TerramaxSitework Ltd., 2007 SKCA 123, 304 Sask R 179 [Terramax], and adopted by the Court of Appeal in Axcess at para. 70: [70] As this Court recognized in Terramax, s. 55(2) does not require that an application to extend the time be granted.

As MauriceJ. indicated in Howden [(1993), (SK KB), 114 Sask R 263], s. 55(2) requires a balancing of the interests of the lienclaimant and the owner of the property.

The remedy of extending the time limitation requires that the applicant “provide an explanationof the delay to show that the delay was not unreasonable or unjustified” and that the judge “consider the prejudice to each party thatwould result from granting or refusing the extension sought” (Terramax, para. 18). [57] Earnshaw submits that some delay in this action may be attributed to the appeal brought by other lien claimantsfrom the decision of Chicoine J., as well as the COVID-19 pandemic.

After the appeal decision, the Order had to be amended to correct aclerical error. [58] Earnshaw’s notice of application asserts that the delay in bringing the matter to court was due to factors outsideof its control and it will be prejudiced if the order is not granted, while the other lien claimants and the Owner will not be prejudiced if itis. Mr. Earnshaw attested in his affidavit that “there has been no contact from the other lien claimants” since the Order of Chicoine J. wasamended. Mr.

Earnshaw does not offer any explanation for the delay or any facts relevant to the issue of prejudice to each party thatwould result from granting or refusing the extension sought. [59] Having said that, the Owner – the payor of the funds into court – did not object to an extension of time whenEarnshaw’s application was heard. An order to extend the time for setting the matter down for trial is unlikely to cause any prejudice tothe Contractor, since, if the order is refused: (

a) The funds would be paid out of court to the Owner rather than to the lien claimants; and (

b) The lien claimants would still be free to pursue their contractual claims against the Contractor for the full amount claimed. [60] Despite this, the comments made above regarding the importance of notice to affected parties apply with equalforce to the application to extend time. Earnshaw’s application to extend the time for setting the matter down for trial is adjourned sine

die , returnable to chambers on 14 days’ notice. Is Earnshaw entitled to common carriage costs? [ 61 ] Given the outcome of this application, I will not address Earnshaw’s application for common carriage costs. CONCLUSION [ 62 ] The application pursuant to s. 56(9) of the BLA is dismissed. The application for an extension of time pursuant to s. 55(2) of the BLA is adjourned sine die , returnable to chambers on 14 days’ notice. [ 63 ] Given the positions taken by the parties that participated in the hearing, I make no award of costs. J. P. T. BERGBUSCH