2022 MBKB 193, 2022 MBKB 193

Date: 20221014 Docket: CI 11-01-71706 (Winnipeg Centre) Indexed as: Tuxedo Yards Development Corp., et al v. Canadian National Railway Company Cited as: 2022 MBKB 193 COURT OF KING’S BENCH OF MANITOBA B E T W E E N: TUXEDO YARDS DEVELOPMENT CORP., MONTEZ CORE INCOME FUND GP INC. operating under the business name MONTEZ CORE INCOME FUND LIMITED PARTNERSHIP, a nd IKEA PROPERTIES LIMITED, )))))) ) Appearances Robert L. Tapper, Q.C. Counsel for this motion only on a limited retainer plaintiffs, ) ) -and- ) ) CANADIAN NATIONAL RAILWAY COMPANY, ) ) Chloe A. Snider, Mark Glynn and S.

Gabor defendant, ) ) ) Counsel for the defendant THE CITY OF WINNIPEG, third party. ) ) ) ) ) Kalyn B. Bomback Counsel for the third party on a watching brief ) ) JUDGMENT DELIVERED: October 14, 2022 MASTER GOLDENBERG INTRODUCTION [ 1 ] The plaintiffs filed a statement of claim on April 21, 2011, which was amended by the consent of the parties on October 23, 2013. A statement of defence and counterclaim was filed on June 27, 2011. The plaintiff, IKEA Properties Limited discontinued its action against the defendant on November 7, 2013.

The defendant filed a third party claim against The City of Winnipeg on December 15, 2016, which The City of Winnipeg defended on January 17, 2017. The defendant delivered a reply to the third party defence on March 17, 2017. [ 2 ] The action relates to a lease dated October 1, 1975, entered into by the defendant, Canadian National Railway Company (the “defendant”) with the then owners of a parcel of land commonly referred to as the Tuxedo Yards (the “Land”).

The plaintiffs allege that they are successors to the owners, and now own the Land. [ 3 ] The crux of the plaintiffs’ claim is that the defendant wrongfully permitted The City of Winnipeg and/or other parties to use the

Land for the purposes of a dumping site of unclean fill, which it says, gives rise to a cause of action in contract, negligence and/or the tort of waste. [ 4 ] The defendant brings this motion to dismiss the plaintiffs’ action for delay alleging both long delay and inordinate and inexcusable delay. The third party takes no position on this motion. In these reasons, any reference to the parties means the plaintiffs and the defendant. THE LAW [ 5 ] The motion was brought pursuant to Rules 24.01 and 24.02 of the Court of Queen’s Bench Rules, Man. Reg. 533/88, now the Court of King’s Bench Rules (“the Rules”).

Those Rules provide in part as follows: Dismissal for delay 24.01(1) The court may, on motion, dismiss all or part of an action if it finds that there has been delay in the action and that delay has resulted in significant prejudice to a party.

Presumption of significant prejudice 24.01(2) If the court finds that delay in an action is inordinate and inexcusable, that delay is presumed, in the absence of evidence to the contrary, to have resulted in significant What constitutes inordinate and inexcusable delay 24.01(3) For the purposes of this rule, a delay is inordinate and inexcusable if it is in excess of what is reasonable having regard to the nature of the issues in the action and the particular circumstances of the case.

Dismissal for long delay 24.02(1) If three or more years have passed without a significant advance in an action, the court must, on motion, dismiss the action unless (

a) all parties have expressly agreed to the delay; (

b) the action has been stayed or adjourned pursuant to an order; (

c) an order has been made extending the time for a significant advance in the action to occur; (

d) the delay is provided for as the result of a case conference, case management conference or pre-trial conference; or (

e) a motion or other proceeding has been taken since the delay and the moving party has participated in the motion or other proceeding for a purpose and to the extent that warrants the action continuing. . . . Transitional — no application to motions before January 1, 2019 24.02(4) The court may only apply subrule (1) in a motion to dismiss an action for delay that has been brought after January 1, 2019. [ 6 ] The long delay rule came into force on January 1, 2018 (see Manitoba, Court of Queen’s Bench Rules, amendment, Man.Reg. 130/2017,

section 43), but applies only to motions brought after January 1, 2019. POSITIONS OF THE PARTIES [ 7 ] The defendant takes the position that there has been long delay pursuant to Rule 24.02 the result of which is that the court must dismiss the action. In particular, it says that more than three years passed without a significant advance in the action and that none of the exceptions set out in Rule 24.02(1) apply.

It also says there has been inordinate and inexcusable delay in the action for which the court ought to dismiss the action. [ 8 ] The plaintiffs say that there was a significant advance in the action and that the defendant participated significantly in the delay and therefore cannot rely upon it. In particular, the plaintiffs take the position that it was not appropriate for the defendant to bring a motion to dismiss for delay when it was seeking the plaintiffs’ participation in settlement discussion and while the plaintiffs were seeking to

schedule a pre-trial conference. The plaintiffs’ position is that they were attempting to move the case along, that is to “reset the clock”, but the defendant was doing what it could to obstruct that.

FINDING [ 9 ] The parties made submissions with respect to delay under both headings. For the reasons that follow, I find that there has been long delay pursuant to Rule 24.02. Based on that finding it is not necessary for me to determine whether the delay was inordinate and inexcusable under Rule 24.01.

PROCEDURAL CHRONOLOGY [ 10 ] The dates of consequence for this motion are as follows: April 21, 2011 Statement of claim filed June 27, 2011 Statement of defence and counterclaim filed May 2, 2012 Reply to the statement of defence filed October 23, 2013 Statement of claim amended November 13 & 14, 2013 Examination for discovery of the defendant May 21 & 22, 2014 Examination for discovery of the plaintiffs June 2, 2016 Continued examination for discovery of the defendant June 27, 2016 Continued examination for discovery of the plaintiffs September 1, 2016 Further written interrogatories were served on the plaintiffs December 15, 2016 Third party claim filed January 17, 2017 Defence to the third party claim filed March 17, 2017 Reply to the third party defence filed July 10, 2017 Plaintiffs’ canvassed availability for a pre-trial conference October 11, 2017 The defendant requested answers to undertakings from the June 27, 2016, examination and answers to the September 1, 2016, written interrogatories from the plaintiffs (1 st request) October 18, 2017 The defendant requested answers to undertakings from the June 27, 2016, examination and answers to the September 1, 2016, written interrogatories from the plaintiffs (2 nd request) April 24, 2018 A discussion took place between counsel for the parties April 24, 2018 The defendant requested answers to undertakings and/or answers to written interrogatories from the plaintiffs (3 rd request) April 25, 2018 The plaintiffs provided partial answers to the written interrogatories October 1, 2018 The plaintiffs made a settlement offer December 19, 2018 The defendant rejected the settlement offer December 19, 2018 The defendant requested answers to undertakings and/or answers to written interrogatories from the plaintiffs (4 th request) January 8, 2019 The defendant requested answers to undertakings and/or answers to written interrogatories from the plaintiffs (5 th request) October 31, 2019 The plaintiffs provided partial answers to outstanding undertakings March 17, 2020 Three years passed since the reply to the third party defence July 4, 2020 The plaintiffs provided further partial answers to undertakings August 28, 2020 Plaintiffs’ counsel provides defendant’s counsel with details of the damages claim October 26, 2020 The defendant filed this motion to dismiss for delay ANAYLSIS – LONG DELAY [ 11 ] The long delay rule has now been considered in a number of cases in Manitoba in the Court of King’s Bench as well as by the Court of Appeal.

The Court of Appeal first considered the long delay rule in Buhr v. Buhr , 2021 MBCA 63 (“ B uhr ”). That decision was pronounced prior to the hearing of this motion and the parties had opportunity to make submissions regarding that decision. The Court of Appeal considered the rule again in WRE Development Ltd. v. Lafarge Canada Inc. , 2022 MBCA 11 (“ WRE Development ”) which was pronounced after this motion was heard but before this decision was issued.

In WRE Development , the Court of Appeal upheld the decision of the motion judge, and the parties had opportunity on this motion to make submissions regarding the decision of the motion judge. [ 12 ] If there has been long delay, that is to say three years without a significant advance in the litigation, the court must dismiss the action unless one of the enumerated exceptions apply. (See Buhr , at paras. 33-36 ). That is the case even if the court were to find that the action ought not to be dismissed under Rule 24.01, and regardless of the merits of the action. Was there a Significant Advance?

[ 13 ] The defendant’s position is that there was a period of long delay of just over four years from June 2, 2016, until June 22, 2020, during which it says the plaintiffs did not take any significant steps to advance the action. It takes the position that the continued examination for discovery of the defendant’s representative by the plaintiffs on June 2, 2016, was the last significant advance in the action. [ 14 ] In the plaintiffs’ written submissions, they make no submissions on the question of whether there were any significant advances in the action.

In oral argument, the plaintiffs took the position that the third party pleadings including the defendant’s reply to the third party defence filed on March 17, 2017, was a significant advance.

The plaintiffs also argued that their provision of some answers to outstanding discovery requests on April 25, 2018, was a significant advance in the action. [ 15 ] In my view, looking at the procedural chronology, the events that could be seen as significant advances include: • the June 27, 2016, continued examination for discovery of the plaintiffs’ representative; • the third party pleadings, the last of which was filed on March 17, 2017; • the partial answers to interrogatories provided by the plaintiffs on April 25, 2018; and • the partial answers to undertakings provided by the plaintiffs on October 31, 2019. [ 16 ] In Buhr , the Court of Appeal makes clear that the rule is triggered once any three or more years have passed without a significant advance in an action ( Buhr , at para. 52 ).

It also makes clear that the rule applies to any three-year period of delay, even if some of that delay elapsed before the rule came into effect on January 1, 2018, provided that the one-year transition period between January 1, 2018, and January 1, 2019, is included in the three-year period ( Buhr , at para. 67 ). [ 17 ] The partial answers to interrogatories on April 25, 2018, and the partial answers to undertakings on October 31, 2019, are the key events to consider in the present case.

That is because, even if the reply pleadings were a significant advance, there was still a period of three or more years without any other events alleged to be significant advances after March 17, 2017. That three-year period includes the one-year transition period (the 2018 calendar year).

Accordingly, the parties had that one-year to make a significant advance in the action and avoid becoming trapped by the rule (see Buhr , at para. 67 ). [ 18 ] As confirmed by the Manitoba Court of Appeal in Buhr and in WRE Development , the test for determining whether there has been a significant advance is a functional test. The following analysis of the functional test in Buhr is instructive: 69 The parties adopt, as do I, the approach the Alberta Court of Appeal has taken in defining a "significant advance" in an action, for the purpose of application of the long-delay rule.

In Morrison v Galvanic Applied Sciences Inc, 2019 ABCA 207 , the Court confirmed the following definition that it had set out in Ro-Dar at para 20 (at para 35): A significant advance exists if the nonmoving party in the applicable timeframe has done something that increased by a measurable degree the likelihood that either the parties or the court would have sufficient information to rationally assess the merits of the parties' positions and be in a better positon to either settle or adjudicate the action. Has the nonmoving party done something that "narrow(ed) the issues, complete(

d) the discovery of documents and information, or clarif(ied) the positions of the parties"? [footnotes omitted] 70 Similarly, the Alberta Court of Appeal has recently described a "significant advance" as one that constitutes "important or notable progress towards the resolution of an action" (Jacobs at para 85; see also para 86). 71 In determining whether there has been a "significant advance", Ro-Dar articulated the applicable functional test, citing Nash v Snow , 2014 ABQB 355 at para 30 (at para 21): . . . . . .

Put another way, the court must view the whole picture of what transpired in the three-year period, framed by the real issues in dispute, and viewed through a lens trained on a qualitative assessment. This necessarily involves assessing various factors including, but not limited to, the nature, value and quality, genuineness, timing, and in certain circumstances, the outcome of what occurred. . . . and 78 . . .

To be clear, the functional test is a broad-based inquiry into whether the advance in an action "moves the litigation forward in a meaningful way considering the nature, value, importance and quality of the action". "[T]he focus is on substance and effect rather than form" ( St Jean Estate v Edmonton (City) , 2014 ABQB 47 at paras 18-19 ).

[ 19 ] The defendant provided case law in support of the position that commencing a step in the litigation that is not completed will not be deemed to have significantly advanced the action. It also expressed concern that a plaintiff should not be allowed to skirt the long delay rule by providing piecemeal, long overdue answers to discovery requests. [ 20 ] Certainly a plaintiff that provides partial answers to undertakings piecemeal over the course of three years cannot say that it completed its discovery obligations thereby paving the way for the next logical step in the litigation.

Such a plaintiff will need to show, absent any other significant advance in the action, that whatever it did provide during the three-year period amounted to a significant advance in the action. [ 21 ] Applying the functional test to this case, I am to consider whether the partial provision of answers on each of the dates referenced, either individually or collectively, was a significant advance based on the particular context and facts of this case and this litigation. [ 22 ] The background of the litigation that I consider to be of significance is that the parties had exchanged affidavits of documents and counsel for the plaintiffs conducted an examination for discovery of the defendant representative on November 13 and 14, 2013.

The defendant then provided answers to undertakings given during that examination for discovery. On May 21 and 22, 2014, counsel for the defendant conducted an examination for discovery of a representative of the plaintiffs. Both parties served written interrogatories after their initial examinations for discovery.

The defendant answered the interrogatories of the plaintiffs in an affidavit sworn on June 1, 2016, and the plaintiffs answered interrogatories on June 27, 2016. [ 23 ] Continued examinations for discovery were conducted on June 27, 2016, of a representative of the plaintiffs, at which various undertakings were given. From the evidence, I surmise that there were 31 undertakings given at that time, referred to as undertakings 81 to 112. That continued examination also gave rise to the further written interrogatories served by counsel for the defendant on September 1, 2016.

Those written interrogatories are at Exhibit “S” to the affidavit of Jody Evely sworn March 1, 2021, and set out four separate questions about a

summary of costs provided by the plaintiffs in a previous answer to undertaking. It also asks the plaintiffs to provide further particulars and documentation of any special damages claimed that have not been discussed to date. [ 24 ] Michael Weinstein, who was legal counsel, assisting David Hill with the litigation, affirmed an affidavit on March 4, 2021. In it, he provides some context regarding the facts of the case and litigation. He explains that the Land at issue was some 27 acres and was heavily damaged.

As set out in the amended claim, the plaintiffs allege that the defendant permitted the City of Winnipeg and other parties to use the property as a dumping site for unclean fill which the plaintiffs say made the Land unsuitable for development purposes until it was remediated. [ 25 ] Mr. Weinstein explains that in order to reply to the counterclaim, as well as to prepare for discovery and answers to undertakings, that he was required to locate and communicate with seven different individuals ranging from geotechnical experts, civil engineers, and architects.

His affidavit speaks about the significant undertakings given by the plaintiffs and details that the plaintiffs’ representative had personal matters that distracted him making him unable to deal with the undertakings. The representative was apparently consumed with personal matters that made him unavailable for periods of time during the period of 2014 through 2016. Mr. Weinstein indicates that he provided the interrogatory responses on April 21, 2016, and the undertakings answers on April 28, 2016. [ 26 ] The continued examination for discovery of the plaintiffs then took place on July 27, 2016. Mr.

Weinstein’s affidavit does not speak to any issues regarding the plaintiffs’ provisions of the undertakings or interrogatories arising from the further examination for discovery.

Therefore, while his affidavit does provide some context regarding the facts of the case and this litigation, it does not speak specifically to the steps taken by the plaintiffs on April 25, 2018, or October 31, 2019. [ 27 ] On five occasions counsel for the defendant wrote to counsel for the plaintiffs to request answers to undertakings and/or answers to written interrogatories: October 11, 2017, October 18, 2017, April 24, 2018, December 19, 2018, and January 8, 2019. [ 28 ] The defendant’s first request on October 11, 2017, followed a request by the plaintiffs on July 10, 2017, to set the matter down for a pre-trial conference without further delay.

The October 11, 2017, request follows up on the outstanding undertakings given at the June 27, 2016, examination as well as the interrogatories served on September 1, 2016. That correspondence also refers to the plaintiffs’ desire to set the matter for trial. Counsel for the defendant notes that the matter is not ready to be set down for trial given the discovery steps that must still be completed. [ 29 ] On April 24, 2018, defendant’s counsel sent a list of outstanding undertakings to counsel for the plaintiffs. That list sets out that undertakings 81 to 112 were still outstanding.

The plaintiffs provided partial Answers to Interrogatories on April 25, 2018. [ 30 ] On December 19, 2018, counsel for the defendant acknowledges that certain answers to other questions were provided, but says that the list of outstanding undertakings set out in their April 24, 2018, letter still remained outstanding.

At that time, counsel also wrote: Secondly, to the extent that a full damages breakdown is not set out in the answers to the attached, we will require that your client provide a complete damages breakdown for all amounts that will be sought at trial (with supporting documents). [ 31 ] From that correspondence, I surmise that on April 25, 2018, the plaintiffs answered the four specific questions about the

summary of costs previously provided by the plaintiffs, but did not respond to the question requesting particulars and documentation of any special damages claimed that had not been disclosed to date. As well, the 31 answers to undertakings were still outstanding. [ 32 ] On January 8, 2019, counsel for defendant again attaches the same list of outstanding undertakings (nos. 81 to 112) and again

requests a complete damages breakdown. On July 17, 2019, Mr. Hill wrote to the defendant’s counsel to advise that he had been unable to attend to providing the answers to the remaining undertakings of the plaintiffs but was now working on that and hoped to have a number, if not all, of those undertakings fulfilled and sent shortly. [ 33 ] On October 31, 2019, the plaintiffs provided further but still incomplete answers to undertakings. Those answers to undertakings (which are included at Exhibit “BB”” of the affidavit of Jody Evely sworn March 1, 2021) include answers to many of the undertakings 81 to 112.

However, no answers were provided to undertakings 82, 95, 97, 104, 105, 107, 108 or 112. [ 34 ] The plaintiffs provided further answers to undertakings on July 4, 2020, outside the three-year period of consideration. According to the correspondence provided with the answers, there was one answer still outstanding at that time. The Answers to Undertakings themselves show that undertakings 107 and 108 were still outstanding, but that the answer to 108 would apparently answer both questions.

Those undertakings were as follows: Undertaking No. 107 To confirm amount paid to Geo-exergy re geothermal (p509) Undertaking No. 108 To inquire and advise how much was actually paid over the original contract to Geo-exergy on account of unsuitable fill (p514) [ 35 ] The plaintiffs’ submissions and evidence say very little about the partial answers to interrogatories provided on April 25, 2018, and the partial answers to undertakings provided on October 31, 2019. As noted, the brief does not allege that there were any significant advances in the action.

Nor did the oral submissions made by counsel on the motion suggest how the answers provided on those dates advanced the action in any way. Counsel submitted that answers to interrogatories or undertakings, as part of the discovery process, are, in and of themselves an advancement. [ 36 ] I pause here to note that there is a discrepancy in the parties’ evidence as to a discussion that took place between counsel on April 24 or 25, 2018. The affidavit of Jody Evely (Assistant Vice-President for the defendant) sworn March 1, 2021, says that there was a discussion between counsel for the parties on April 24 , 2018.

Jody Evely states that later on that day following that conversation, that the defendant’s lawyer wrote to the plaintiffs’ lawyer with respect to the outstanding answers to undertakings. That was the defendant’s third request as referenced earlier in these reasons. [ 37 ] In Mr. Hill’s affidavit affirmed March 3, 2021, he says he served the answers for interrogatories on the defendant on April 25 , 2018, and had a conversation with the defendant’s counsel on that date, which he describes as a settlement discussion. He said he was asked to provide settlement numbers in detail.

He says further that the calculation of damages was extremely complicated and on October 1, 2018, he provided a settlement letter to the defendant’s counsel. [ 38 ] In his affidavit, Mr. Weinstein confirms that he was aware of the April 24 , 2018, conversation between Mr. Hill and Ms. Snider as Mr.

Hill and he discussed prior to the conversation that the conversation was designed, by them at least, to discuss settlement. [ 39 ] The correspondence between counsel is included in Jody Evely’s affidavit and supports a finding that the conversation took place on April 24, 2018, before the plaintiffs provided some of their answers on April 25, 2018. Correspondence from April 23, 2018, arranges for a time for counsel to talk on April 24, 2018. Correspondence from Ms. Snider to Mr.

Hill on April 24, 2018, references the call that took place as follows: Please find attached the list of undertakings to which I was referring on our call. I will wait to hear from you with respect to answers to these undertakings and with respect to whether an offer to settle is possible. [ 40 ] I find, based on the evidence before me, that the conversation took place on April 24, 2018, as confirmed by both Michael Weinstein and Jody Evely, and that it included at least a reference to settlement.

The evidence does not disclose any further detail about that conversation. [ 41 ] A settlement offer was made by the plaintiffs on October 1, 2018. That offer was rejected by the defendant on December 19, 2018. At that time, counsel for the defendant wrote to counsel for the plaintiffs advising in part as follows: CN will not be making a counter-offer at this time, but is prepared to agree to a judicial mediation on certain conditions. First, we require that you provide answers to undertakings set out in the attached chart, which I sent to you on April 24, 2018.

Although certain answers to other questions were subsequently provided, they did not include answers to the attached questions. Secondly, to the extent that a full damages breakdown is not set out in the answers to the attached, we will require that your client provide a complete damages breakdown for all amounts that will be sought at trial (with supporting documents). Without the information requested above, we will not be able to agree to a mediation or engage in meaningful settlement discussion.

… [ 42 ] In his affidavit affirmed March 3, 2021, Mr. Hill, states that he provided further answers to undertakings on October 31, 2019, and believed those to be the last answers to undertakings which would thus remove any opposition by plaintiffs’ counsel to scheduling a pre-trial conference. However, it is clear from the evidence that there were still eight outstanding undertakings at that time.

Accordingly, the partial provision of undertakings on October 31, 2019, still did not put the parties in a position to proceed to pre-trial. [ 43 ] The plaintiffs tried to set the matter down for pre-trial on June 22, 2020. On that date, counsel for the plaintiffs wrote to counsel for the defendant advising that they had filed and were delivering a pre-trial conference brief and asked for counsel’s availability for a pre-trial conference. While the plaintiffs’ efforts to

schedule a pre-trial conference are outside the three-year period under review, I consider the evidence relevant to the question of whether the partial provision of answers to interrogatories and undertakings was a significant advance in the litigation. That is because of the suggestion by the plaintiffs that those amounted to a significant advance in the action because their provision brought the matter closer to pre-trial. [ 44 ] Defendant’s counsel responded to that attempt to

schedule a pre-trial on June 25, 2020, in part as follows: I was surprised to receive your email below indicating that you have decided to

schedule a pre-trial conference without speaking with us and without any explanation as its purpose. When you last wrote us in October 2019 with partial answers to undertakings that took your client more than three years to provide, you stated that for the undertakings that remained unanswered, you were “collecting info from third parties and will provide those as soon as they are received”. We have not heard back from you since. Can you please update us on when you expect to provide those answers?

More generally, we do not agree that it is appropriate for a case conference to be scheduled in this matter at this time. First, we are not ready for trial – there are additional discoveries and other steps that need to take place. Secondly, it is not clear what the purpose of this case conference is, not have we had any opportunity to discuss this matter.

In that regard, the requirements set out in the court’s [April 7, 2020, Notice re: Civil Pre-Trial and Case Management Conferences] have not been met. [ 45 ] The plaintiffs continued to try to set the matter down for pre-trial after providing further answers to undertakings on July 4, 2020, and advising that they were continuing to work on the one outstanding undertaking. Counsel for the plaintiffs noted as follows regarding the April 7, 2020, Notice: We acknowledge the directive dated April 7, 2020 from the Court of Queen’s Bench.

In particular, we note from the directive that, at a minimum, examinations for discovery must be completed and reasonable settlement discussions will have been attempted prior to the scheduling of a pre-trial conference. To that end, there is now only one undertaking outstanding after several dates of discovery and several exchanges of interrogatories.

If further discovery is required, that can be addressed in due course, particularly since a trial date will not likely be scheduled for a period of at least 18 months following the pre-trial conference and likely beyond that. [ 46 ] On July 10, 2020, the defendant’s counsel responded and set out issues that it felt still remained outstanding before either a pre- trial conference or judicially assisted mediation could be scheduled. That correspondence provides in part as follows: . . .

Specifically, we require that you provide complete particulars of the general, specific and punitive damages being sought with reference to the supporting documents, including invoices or quotes (with an indication as to which costs have been incurred to date, and which have not). We requested this information in UT 102, which has not been properly answered. Without this information, we do not think it is appropriate to

schedule a pre-trial conference or mediation. . . . There are other outstanding issues, including (

i) we must review the answers provided to consider their sufficiency (as noted the answer to UT 102 is not sufficient); (ii) the third party claim must proceed to discovery; and (iii) we expect to seek further discovery of Mr. Nozick, as Mr. Riley requested in December 2016 and January 2017 without receiving a response. . . . [ 47 ] The defendant takes the positon that the partial answers on these two dates did not materially advance the action. In addition to the issues raised by counsel in the correspondence set out above, counsel submitted that the unanswered undertaking 108 relating to

monies paid on account of unsuitable fill goes to the core of the plaintiffs’ damages claim. [ 48 ] In Buhr , the Court of Appeal found that the motion judge did not err in determining that the plaintiff’s provision of answers to some, but not all, of his undertakings and matters taken under advisement at the examination for discovery did not constitute a significant advance in the action.

The Court of Appeal found that although the provision of answers to undertakings may (depending on the circumstances) constitute a significant advance, the functional test must be applied to the facts of the particular case to determine if the provision was a significant advance (see Buhr at para. 79 ). [ 49 ] In Buhr , the plaintiff had given a total of 11 undertakings (or matters taken under advisement) at the examination for discovery which took place in late September 2016. In July 2019, he answered eight of those undertakings.

However, the motion judge found that importantly, two key requests remained outstanding: the response to the request to produce expert reports and the answer to the request to provide a damages assessment. It was also noted in that case that at the adjournment of the examination for discovery, the defendants’ counsel emphasized his request for a damages assessment and breakdown.

The Court of Appeal noted as follows about those facts: 87 The fact that a damages assessment was omitted from the answers, together with there being no response to the request for expert reports to be relied upon, speak directly to the nature and quality of the step taken in answering undertakings. 88 Notwithstanding the answers, the defendants still required further examination of the plaintiff on material issues, specifically quantum of damages, which they could not meaningfully undertake without more information.

Further, by virtue of r 31.06(3), the defendants would be entitled to examine the plaintiff with respect to the opinion of an expert, as outlined in a report.

Had the plaintiff's examination for discovery been resumed without production of the damages assessment or any of the expert reports to be relied upon, a third round of examination of the plaintiff would have been necessary. [ 50 ] When I consider the totality of the answers provided by the plaintiffs on April 25, 2018, and October 31, 2019, I am unable to conclude that taken separately, or together, that they amounted to a significant advance in the action.

While the plaintiffs did make a settlement offer on October 1, 2018, that offer was rejected, and I cannot find on the evidence that the provision of the partial answers put the parties in a better position to settle. On the contrary, when it rejected the plaintiffs’ offer on December 19, 2018, the defendant said it would not engage in settlement discussions unless the plaintiffs provided the outstanding answers to undertakings and a full damages breakdown.

The defendant’s refusal to engage in settlement until the plaintiffs complied with the outstanding requests was still operative in July of 2020. [ 51 ] Nor can I find that the partial answers put the parties in a better position to adjudicate the action. On October 11, 2017, closer to the start of the three-year period, the defendant resisted the plaintiffs’ efforts to set the matter down for pre-trial on the basis that the discovery steps were incomplete. On October 31, 2019, there were eight still unanswered undertakings and no response to the final interrogatory regarding damages.

That was still the case on March 17, 2020, which is the end of the three-year period under review. Understandably, the defendant continued to resist the plaintiffs’ push to move the matter to pre-trial. [ 52 ] Nor have the plaintiffs suggested any other way that the partial provision of answers on those two dates moved the litigation forward in a meaningful way. Their evidence does not support a finding that the answers provided on April 25, 2018, and/or October 31, 2019, significantly advanced the action in any way. Most of Mr. Weinstein’s evidence relates to the period before the three-year period under review.

Most of Mr. Hill’s evidence and all of their assistant’s evidence (from an affidavit sworn October 26, 2020) relates to the period after. It is not enough, under a functional analysis, to simply assert that a step taken materially advanced the action. [ 53 ] As the trial judge found in Buhr , I find that the partial answers provided by the plaintiffs in the three-year period under review were at best a modest, not significant, advance of the action toward trial. As in Buhr , this defendant has emphasized their repeated requests for a damages assessment and breakdown.

On the facts of this case, I find that the action was stalled pending the plaintiffs complying with their outstanding undertakings and answers to written interrogatories. [ 54 ] As a result, I find that that there was no significant advance in the action in the three-year period following the close of the third party pleadings on March 17, 2017. Therefore, even if those pleadings were significant advances, three or more years passed without a significant advance in the action after that time, and I must dismiss the action unless one of the enumerated exceptions apply.

Do any of the Exceptions Apply? [ 55 ] The defendant says that none of the enumerated exception in Rule 24.02(1) apply. The plaintiffs did not expressly argue that any exceptions apply; however, their submissions suggest acquiescence or agreement to delay on the part of the defendant.

The plaintiffs say that where the defendant participates in the delay, or agrees or acquiesces in the delay, the delay motion is defeated. [ 56 ] On the issue of acquiescence, the Court of Appeal in Buhr clearly found that any common law exception to delay based on acquiescence by the moving party that had been recognized in some Alberta case law is now enshrined in Rule 24.02(1)(e). That Rule prescribes the circumstances under which a moving party’s acquiescence precludes dismissal in a long delay case (see Buhr at paras. 43- 45 and 91 ).

Specifically, to fall within that exception, the moving party must have participated in a motion or other proceeding for a purpose and to the extent that warrants the action continuing. There is no suggestion in the present case that this exception applies. [ 57 ] The plaintiffs here, as in Buhr , do not expressly rely on Rule 24.02(1)(e); rather, seem to suggest that because the parties were having some settlement discussions and because the plaintiffs were trying to set the matter down for pre-trial, the defendant was somehow precluded from bringing the motion for delay.

[58] In his affidavit, Mr. Hill states that following what he believed to be the last of the undertakings that were provided on October31, 2019, he wanted to exert some pressure on the defendant and if the case was not to be settled to obtain a trial date. Accordingly, hecaused a pre-trial brief to be filed on June 11, 2020. He then engaged in the discussions with plaintiffs’ counsel who was resisting settingthe matter for pre-trial, as outlined earlier.

On July 30, 2020, he said he wanted to resolve the matter at the present time or set a pre-trial.On August 28, 2020, he spoke with defendant’s counsel again about the necessity for setting a pre-trial and the issue of settlement, andsent her a memorandum respecting settlement which he says dealt with the damages issue and illustrates the intense degree ofcomplexity to the case and especially as relating to damages calculations. [59] Mr.

Hill wrote that on September 24, 2020, he received correspondence from the defendant’s counsel advising they were indiscussions regarding the settlement proposal and he responded that he was insisting on setting a pre-trial date. When he sent availablepre-trial dates on October 20, 2020, the defendant’s counsel responded to indicate they were bringing the motion to dismiss for delay. [60] In his affidavit, Mr. Hill states as follows about those interactions: 18. In the preceding several months, the discussions between myself and Ms.

Snider were clearly settlement discussions and Ms.Snider indicating that she did not wish to have a date scheduled for the pre-trial conference. The tenor of those discussions wasclearly an indication that the defendant was willing to consider settlement and putting off the pre- trial conference for that purpose. [61] In the plaintiffs’ brief, they submit that seeking the plaintiffs to participate in settlement discussions while the defendant utilizedthat time to prepare a delay motion was disingenuous in the extreme.

They submit further that the defendant was playing somewhat loosewith the rules by seeking settlement instructions while asking for a delay motion. Further, they say the defendant refused to cooperate asprofessional courtesies demand in the scheduling of a date for a pre-trial. The plaintiffs say they were trying to move the case along in amanner which “resets the clock” and the defendant was doing what it could to obstruct that. [62] The plaintiffs argue that the law is clear that where a defendant participates in the delay, or agrees or acquiesces in the delay, thatthe delay motion is defeated.

The plaintiffs rely on two cases in support of their position that the motion must be dismissed because ofthe defendant’s actions. They rely on Krasulja v. Manaigre, 2021 MBQB 131 (“Krasulja”) and in particular paragraphs 22 and 23: 22 The defendant says that the plaintiff took no significant steps in this action after serving the statement of claim. But, as explainedin Ursa Ventures, the long delay rule does require continuous advancement in an action.

It permits inaction for close to three years aslong as something is done to significantly advance the action prior to the expiration of the three years. 23 It is true that the plaintiff has been lax in pursuing his claim, but the defendant has been equally lax. It took defendant's counsel 10months to reply to an inquiry that allowed the plaintiff to consent to the amendment to add the counterclaim. As stated in TransamericaLife Canada v.

Oakwood Associates Advisory Group Ltd., 2019 ABCA 276 (albeit not a long delay case): [27] It is correct to say that the plaintiff has the primary obligation in moving the litigation forward. The Rules of Court give the plaintiffmany tools to ensure that happens. It does not follow, however, that a defendant has no obligation with respect to the pace of litigation.This was confirmed, for example, in Sir Alfred McAlpine at p. 260: Since the power to dismiss an action for want of prosecution is only exercisable upon the application of the defendant, his previousconduct in the action is always relevant.

So far as he himself has been responsible for any unnecessary delay, he obviously cannot relyupon it. . . . [63] The decision Transamerica Life Canada v. Oakwood Associates Advisory Group Ltd., 2019 ABCA 276 (“Transamerica”)referenced in the quote from Krasulja is the second case relied on by the plaintiffs. [64] In Krasulja, the court dismissed a defendant’s motion to dismiss for long delay. However, the reasoning in Krasulja does notapply to the facts of this case.

The court found, firstly, that the long delay rule did not apply because there was a significant advance inthe action (the filing of a counterclaim) such that there was not a three-year period of inactivity.

In the alternative, the court found thatthere was an express agreement to the delay when the defendant’s counsel granted the plaintiff an indefinite extension of time to file adefence to the counterclaim. [65] This court in Krasulja and the Court of Appeal in WRE Development, have acknowledged that when considering agreements todelay that pre-date the long delay rule, some consideration must be given to past practice (see Krasulja at para. 35 and WREDevelopment at para. 37). However, even in transitional cases such as this, for the agreement to delay exception to apply, the agreementmust be express, not implied.

In WRE Development, the Court of Appeal notes as follows at paragraph 37: 37 In contrast to Bugg, this is not a case where the parties' intentions are clear and not left to inference. In saying this, I recognize that, asnoted in Krasulja, agreements that pre-date r 24.02(1)(

a) should be interpreted with some regard to past practice (see para 35). I alsoacknowledge that plaintiff's counsel believed that nothing further was needed to be done until the drawings were produced. However,neither the discussions after the examinations nor the follow-up emails make mention of anything resembling an understanding regardingdelay or indicate that the parties turned their minds to holding matters in abeyance.

Without more, merely requesting the drawings fromthe defendant that it undertook to provide and awaiting receipt does not evince a clear intent to have matters standstill pending theirprovision and amount to an express agreement to the delay. Rather, contrary to the plain wording of r 24.02(1)(

a) and the jurisprudence,this would be to imply an agreement. The motion judge's conclusion, that there was no express agreement to the delay, is without error

and is justified on the evidence. [ 66 ] The plaintiffs’ requests or attempts to settle the matter does not evidence a clear intent to have the action left at a standstill and do not amount to any express agreement to delay. [ 67 ] While Mr.

Hill affirms in his affidavit that the tenor of the discussions between himself and defendant’s counsel clearly indicate that the defendant was willing to consider settlement and putting off the pre-trial conference for the purpose of settlement, there is no evidence to substantiate an agreement by the defendant to delaying the action for the purpose of settlement. [ 68 ] At best, based on the plaintiffs’ counsel’s understanding, there was an implied agreement to delay, not an express agreement to delay as required to be an exception under Rule 24.02(1)(a).

Furthermore, and of significance, is that the implied agreement asserted by the plaintiffs took place after the three-year period of delay that is, after March 17, 2020, and is therefore not relevant. [ 69 ] To be clear, looking closely at Mr. Hill’s affidavit affirmed March 3, 2021, I am unable to conclude that there was an agreement to delay, express or otherwise. Counsel discussed settlement to some extent on April 24, 2018, and the plaintiffs made an offer on October 1, 2018.

There is no evidence of any intent to put the action on hold during that timeframe, or at any time during the three-year period under review. [ 70 ] The offer was rejected by the defendant on December 19, 2018, and I find that the defendant’s correspondence by their counsel made it clear that it would not agree to engage in meaningful settlement discussions unless the plaintiffs provided their answers to undertakings and their full damages breakdown.

That evidences an intent to the contrary, that is that the defendant was not prepared to engage in settlement until its outstanding discovery requests were provided. [ 71 ] The next communications referred to by Mr. Hill are in June 2020, outside the period of consideration for the long delay rule. Nevertheless, at best, that evidence demonstrates that Mr. Hill was of the view that the defendant was willing to consider settlement and to put off the pre-trial conference for that purpose.

The defendant’s evidence, however, is that it resisted both settlement and pre-trial because the plaintiffs had still not complied with their undertakings. [ 72 ] As with the plaintiff in Buhr , the plaintiffs in this case appear to put forward a position, without expressly relying on the enumerated exceptions to the long delay rule, that the defendant still cannot rely on that rule if it has somehow acquiesced or agreed to or contributed to the delay.

In Buhr , the Court of Appeal made it clear that for a party to rely on acquiescence, it must fall within the enumerated exception at Rule 24.02(1)(e). [ 73 ] In WRE Development , the Court of Appeal also considered whether the defendant’s delay disentitled it form having the action dismissed. In that case, it was the defendant not complying with its obligation to provide outstanding undertakings.

The Court of Appeal references the Transamerica decision as an example of a consideration of defence delay in the context of the discretionary delay rule under Rule 24.01, which is not what is to be considered under Rule 24.02 (see WRE Development para. 40 ). [ 74 ] The Court of Appeal in Buhr acknowledges that the conduct of the defendant is relevant to the application of the functional test in the long delay analysis at paragraph 82: 82 I agree that, in the application of the functional test, the conduct of a defendant, before or after a plaintiff has taken a step, can be relevant to a determination as to whether that step is a significant advance (see Jondreau v Maclean , 2006 ABQB 265 at para 14 ; and Flock at para 17, point 7).

For example, the comments made by counsel for the defendants at the adjournment of the examination for discovery about the need for answers to the undertakings and matters taken under advisement were relevant. Furthermore, had counsel for the defendants indicated, upon receipt, that the answers were satisfactory, that too would be relevant. This does not mean, however, that r 24.02(1) requires a defendant to complain about the quality of answers to undertakings provided in order to establish that the provision of same does not constitute a significant advance.

Nor does the rule require a defendant to follow up and attempt to advance an action (see Charik Custom Homes Ltd v Sara Development Inc , 2014 ABQB 63 at para 33 ). While a defendant cannot intentionally obstruct, stall or delay an action, it need not move a plaintiff's action along (see Flock at para 17, point 4). [ 75 ] In the present case despite the assertions in the plaintiffs’ brief, there is no evidence whatsoever that the defendant engaged in any tactics to obstruct, stall or delay the action.

At most, during the three-year period, there is evidence that the defendant took some time to respond to the settlement offer made by the plaintiffs on October 1, 2018. They rejected the offer on December 19, 2018, when prompted for a response by plaintiffs’ counsel.

In comparison, the defendant made five requests of the plaintiffs to comply with their undertakings during that time period and made it clear that it would not agree to settlement discussions without the outstanding answers to undertakings and requested damages breakdown. [ 76 ] Furthermore, to the extent that some of the plaintiffs’ submissions may be relevant to the issue of delay under Rule 24.01, that does not make them relevant to the analysis under the long delay rule. The plaintiffs’ submissions appear to conflate the analysis of those two rules which is not appropriate.

If the long delay rule applies, the action must be dismissed regardless of whether it should be dismissed under Rule 24.01. [ 77 ] Accordingly, I find that none of the enumerated exceptions to long delay apply, nor is there any evidence of the defendant doing anything to prevent the plaintiffs in this case from moving the action along. The lengthy delay in this action is attributable solely to the plaintiffs’ failure to respond to its undertakings and the written interrogatories in a timely manner.

CONCLUSION [ 78 ] Three or more years have passed without a significant advance in the action and none of the exceptions to the long delay rule apply. Accordingly, I must dismiss the action for long delay. The action commenced by the statement of claim filed on April 21, 2011, amended on October 23, 2013, is therefore dismissed.

[ 79 ] If the parties cannot agree on costs, they may arrange to speak to the issue. J. L. Goldenberg Master