Walker v Mitchell, 2020 SKCA 127

Court of Appeal for Saskatchewan Docket: CACV3578 Citation: Walker v Mitchell , 2020 SKCA 127 Date: 2020-11-16 Between: Cameron Walker Appellant (Plaintiff) And Bradley Mitchell Respondent (Defendant) Before: Whitmore, Tholl and Kalmakoff JJ.A. Disposition: Appeal dismissed Written reasons by: The Honourable Mr. Justice Whitmore In concurrence: The Honourable Mr. Justice Tholl The Honourable Mr. Justice Kalmakoff On appeal from: QBG 1928 of 2017, Saskatoon Appeal heard: November 4, 2020 Counsel: Davin Burlingham for the Appellant Karen Prisciak, Q.C. for the Respondent Whitmore J.A. I.

INTRODUCTION [ 1 ] Cameron Walker appeals the order of a Court of Queen’s Bench judge in Chambers striking his statement of claim on the basis that the claim was an abuse of process: Walker v Mitchell (8 January 2020) Saskatoon, QBG 1928 of 2017. For the following reasons, I would dismiss the appeal. II. BACKGROUND [ 2 ] In September of 2011, the appellant purchased a house and retained the respondent, Bradley Mitchell, as his lawyer. The appellant attended at the respondent’s office and advised him that he intended to purchase the home with his own cash.

He says he advised the respondent he was in a spousal relationship and had been so for more than two years. He also claims he advised the respondent that he and his spouse had an oral agreement that, in the event of separation, his spouse would receive no interest in the family home unless she had contributed funds to it.

If she had provided funds, then, upon separation, she would receive an amount equivalent to the funds that she had provided. [ 3 ] The appellant alleges that he asked the respondent for advice as to whether the oral agreement with his spouse was enforceable and claims the respondent advised him that he did not think any judge would disregard the agreement. The appellant claims he relied upon this advice. [ 4 ] He separated from his spouse in June of 2015, and his spouse commenced an action for division of family property, requesting equal division of the family home.

The appellant agreed that his spouse had contributed $10,000 towards the equity in the home and he was willing to provide her with that amount in full settlement of her family property application.

The offer was not accepted. [ 5 ] Upon his separation, the appellant contacted another lawyer at the respondent’s law firm for advice, but the firm would not represent him in the family law matter as the appellant told the respondent’s firm he may have received erroneous advice from the respondent. [ 6 ] The appellant and his spouse entered into a consent judgment in 2018, whereby the appellant provided $15,000 cash and transferred $56,000 to his spouse by spousal rollover of his RRSPs in full satisfaction of his spouse’s claim to equal division of the family home. [ 7 ] By no later than September of 2015, the appellant was contemplating legal action against the respondent and his law firm seeking damages for losses suffered as a result of the respondent’s negligence in failing to provide him with legally correct advice as to his and his spouse’s rights under The Family Property Act , SS 1997, c F-6.3 .

A statement of claim in this matter was eventually issued on December 21, 2017. [ 8 ] The respondent applied for an order pursuant to Rule 7-9(1) of The Queen’s Bench Rules that the appellant’s statement of claim be struck on any or all of the following grounds: (

a) pursuant to Rule 7-9(2)(

e) for being an abuse of process; (

b) pursuant to Rule 7-9(2)(

a) for disclosing no reasonable cause of action; and

(

c) pursuant to Rule 7-9(2)(

b) for being frivolous, vexatious or scandalous on the basis that the statement of claim was statute barred pursuant to The Limitations Act, SS 2004, c L-16.1 [Act]. [9] The Chambers judge considered s. 5 of the Act, which provides that no proceedings shall be commenced after two years fromthe day on which the claim was discovered.

He also considered s. 6 of the Act, which provides that a claim is discovered when theclaimant first knew or ought to have known of it. [10] After considering the facts as presented to him, he found that the appellant had knowledge of the necessary facts regarding thepotential claim against the respondent on September 16, 2015, at the very latest, and determined the limitation period would commencethen.

The appellant made no argument to the Chambers judge suggesting that he did not have enough knowledge at that time so as to bringhim within the bounds of s. 6(2) of the Act, thus the two-year limitation period expired on September 15, 2017. As the statement of claimwas not issued until December 21, 2017, the Chambers judge found that the limitation period had run. [11] He then turned to the issue of whether the claim could be struck pursuant to Rule 7-9 of The Queen’s Bench Rules.

Counsel forthe appellant presented case law that the predecessor to Rule 7-9 could not be used to strike a claim for a limitation period defence. TheChambers judge also noted other cases that provided that applications under that Rule may be appropriate where a limitation perioddefence is raised. [12] The Chambers judge concluded that the application was not without merit.

He further concluded that the intention of the newrules was to provide greater latitude and “a means by which claims can be justly resolved in or by a court process in a timely and costeffective way” (Rule 1-3(1)). [13] The Chambers judge found that the claim was barred pursuant to the provisions in s. 5 of the Act and that the respondent hadpleaded the Act in the statement of defence. He concluded that to not strike the claim would be an abuse of process.

He thereupon struckthe appellant’s statement of claim. [14] From this decision the appellant appeals on the basis that the Chambers judge should not have struck the claim pursuant toRule 7-9(2)(e), but should instead have dismissed the application on the basis that the respondent could only properly have obtained therelief he sought by applying for a determination of a point of law under Rule 7-1 or by applying for

summary judgment under Rule 7-2. III. JURISDICTION AND STANDARD OF REVIEW [15] The jurisdiction of this Court to consider this appeal is based on The Court of Appeal Act, 2000, SS 2000, c C-42.1, ss. 7(2)(a)and 10. [16] While the decision of the Chambers judge striking the appellant’s statement of claim is a discretionary decision, the question ofwhether the Chambers judge erred in interpreting Rule 7-9(2)(

e) in a way that allowed him to strike the appellant’s statement of claim asan abuse of process is a question of law and attracts a correctness standard of review: Housen v Nikolaisen, 2002 SCC 33, [2002] 2 SCR235. IV. ISSUES [17] The question posed in this appeal is whether the Chambers judge erred in striking the appellant’s claim pursuant to Rule 7-9(2)(

e) as an abuse of process. V. Analysis [18] The Supreme Court of Canada in Toronto v C.U.P.E., Local 79, 2003 SCC 63 at para 51, [2003] 3 SCR 77 [Toronto], statedthat “the doctrine of abuse of process concentrates on the integrity of the adjudication process”.

The doctrine employs the inherent powerof the court to prevent misuse of its procedure in a way that would bring the administration of justice into disrepute: [37] In the context that interests us here, the doctrine of abuse of process engages “the inherent power of the court to prevent the misuseof its procedure, in a way that would . . . bring the administration of justice into disrepute” (Canam Enterprises Inc. v.

Coles (2000), (ON CA), 51 O.R. (3d) 481 (C.A.), at para. 55, per Goudge J.A., dissenting (approved [2002] 3 S.C.R. 307, 2002 SCC 63)).Goudge J.A. expanded on that concept in the following terms at paras. 55-56: The doctrine of abuse of process engages the inherent power of the court to prevent the misuse of its procedure, in a way that would bemanifestly unfair to a party to the litigation before it or would in some other way bring the administration of justice into disrepute. It is aflexible doctrine unencumbered by the specific requirements of concepts such as issue estoppel.

See House of Spring Gardens Ltd. v.Waite, [1990] 3 W.L.R. 347 at p. 358, [1990] 2 All E.R. 990 (C.A.). (Emphasis in original) [19] In Sagon v Royal Bank of Canada (1992), (SK CA), 105 Sask R 133 (CA), this Court considered the basisfor striking a claim for an abuse of process: [19] Finally, a separate mention should be made of the power of the court to prevent abuse of its process, a power which is inherent aswell as conferred under rule 173. Bullen and Leake defines the power as follows at pp. 148-149:

“The term ‘abuse of the process of the court’ is a term of great significance. It connotes that the process of the court must be carried outproperly, honestly and in good faith; and it means that the court will not allow its function as a court of law to be misused but will in aproper case, prevent its machinery from being used as a means of vexation or oppression in the process of litigation.

It follows that wherean abuse of process has taken place, the intervention of the court by the stay or even dismissal of proceedings, ‘although it should not belightly done, yet it may often be required by the very essence of justice to be done’. “The term ‘abuse of process’ is often used interchangeably with the terms ‘frivolous’ or ‘vexatious’ either separately or more usually inconjunction.” (footnotes omitted) [20] Neva McKeague and Christine Johnston’s 2019–2020 Saskatchewan Queen’s Bench Rules Annotated (Regina: Law Society ofSaskatchewan Library, 2019) at 445 provides a useful

summary of the law regarding abuse of process: Subrule (2)(e): Abuse of the process of the court This subrule is available on a more broadly conceived basis than is the form of protection afforded by subrule 7-9(2)(a), which should notbe overlooked when applying to strike out a statement of claim as amounting to an abuse of process: Dagenais v Dagenais, 2007 SKCA117. In an application to strike under subrule 7-9(2)(a), the court is to presume the truth of the contents of a statement of claim. Thisprinciple does not, however, apply to an application made under subrule 7-9(2)(

b) or (e): Pelletier Estate v Uteck, 2008 SKQB 218;Dagenais v Dagenais, 2007 SKCA 117; Haug v Loran, 2017 SKQB 92. This ground merely spells out the inherent jurisdiction that the court has always had to protect itself from being used for baseless,manifestly unsound actions: Chapman Estate v O’Hara (1988), (SK CA), 46 DLR (4th) 504, [1988] 2 WWR 275 (SaskCA), aff’g [1987] TWL QB87117 (QB).

See also R v Janvier, (SK KB), [1985] 5 WWR 59, 41 Sask R 90 (QB); Huntv Carey Canada Inc., (SCC), [1990] 2 SCR 959, 74 DLR (4th) 321; Mahon v Mahon (1982), (SK KB),21 Sask R 10, 30 RFL (2d) 130 (QB); Morrison v Heming (1921), (SK KB), 61 DLR 103 (Sask KB); Sharp v EdsamHoldings Ltd. (1999), (SK KB), 176 Sask R 248 (QB). Abuse of process is a “flexible doctrine”: Robert L. Conconi Foundation v Bostock, 2016 SKQB 399. The order striking on the basis ofabuse of process is discretionary and will be granted only in clear and obvious cases.

It makes no difference whether the order is soughtunder this rule or under the inherent jurisdiction of the court: Gordon International Ltd. v Rosen (1985), (SK KB), 40Sask R 165 (QB). See also Boulding v Hall, 1999 SKQB 264. [21] In Gola v Zaporonik, (SK CA), [1924] 3 WWR 811 (Sask CA), this Court held that it was an abuseof process to commence an action knowing that no cause of action existed. In that case, the defendant mortgaged his land to the plaintiff inthe amount of $800 and agreed to pay the plaintiff “at the office of the Bradshaw Agencies, Limited, Prince Albert” (at para 2).

Thedefendant then paid the full amount owing on the mortgage to the agency, which informed the plaintiff that the money had been paid. Theplaintiff took the position that the money was owed directly to him, and issued a writ claiming the mortgage amount and interest. JusticeLamont found that the plaintiff’s issuance of the writ constituted an abuse of process because the plaintiff knew full well that the agencyhad authority to receive the money, and therefore the plaintiff had no cause of action: [10] The next question is was the issuing of the writ an abuse of the process of the Court? In my opinion it was.

It was a purelyvexatious action, commenced, as the learned local Master has found, solely for the the [sic] purpose of making costs against the defendant.The plaintiff’s solicitor had the mortgage in his possession, and he says he advised the plaintiff as to his rights under it. From thatmortgage he knew that the mortgage moneys were payable to the mortgagee at the Bradshaw Agencies, and that the said Agencies weretherefore the agents of the plaintiff to receive the mortgage moneys. On February 6 the solicitor had been informed that the money hadbeen paid.

Notwithstanding the clear provision in the mortgage, he took the position that the Bradshaw Agencies had no authority toreceive the money, but that it must be paid to him or to the mortgagee personally, and, because it was not so paid, he, onFebruary 7, issued the writ, well knowing when he did so that the moneys had been paid in full at the place where the defendant under theterms of the mortgage was obliged to pay them. The solicitor, therefore, knew, when he commenced proceedings, that the plaintiff had nocause of action.

To issue a writ, knowing that no cause of action exists, is, in my opinion, clearly an abuse of the procedure of the Court.The action, therefore, has been properly stayed. [22] In Campbell v Cooper, 2016 SKQB 251, 22 ETR (4th) 37 [Campbell], the court held that bringing a claim to the court with theknowledge that it was statute barred constitutes an abuse of process. In that case, the plaintiffs were beneficiaries of farmland. On March17, 1990, the owner of the land passed away and, in July 1990, the land was transferred to the beneficiaries.

On December 21, 2011, theplaintiffs sued the defendant for being late in transferring the land to them, which they alleged caused losses and damages. The defendantfiled his defence, stating the claim was statute barred by the passage of time pursuant to the Act. The Chambers judge found that theplaintiffs were aware that the claim was statute barred, and that they were therefore bringing the claim knowing that no cause of actionexisted. In finding this to be an abuse of process, the Chambers judge held as follows: [23] Statute barred claims have been determined by our courts on a

summary judgment application (see Kocsis v Muskeg Lake CreeNation No. 102, 2014 SKCA 39, 438 Sask R 5). The case before me particularly lends itself to a

summary judgment application (seeTchozewski v Lamontagne, 2014 SKQB 71 at paras 27-33, 440 Sask R 34). The plaintiff’s [sic] pleadings set out their position and whendistilled down to the essentials of this application; the affidavit evidence is not in conflict regarding the date of the alleged cause of actionand damages. Therefore, I am prepared to provide a final determination on a

summary judgment basis. Accordingly, I find that the claimis clearly statute barred and amounts to an abuse of process. I need not consider whether the claim is scandalous, frivolous or vexatious.Equally having found as I have, I do not have to consider the doctrine of latches, although parenthetically, I can add I am attracted to thedefendant’s argument on that basis as well. CONCLUSION [24] Therefore, I dismiss the plaintiffs’ entire claim as being an abuse of process and I strike it accordingly and thereby grant thedefendant’s application for

summary judgment. I dismiss the plaintiffs’ application.

[23] Upon appeal to this Court, Ottenbreit J.A. said, in dismissing the appeal ( Campbell v Cooper , 2017 SKCA 55 ): [11] The Chambers judge then proceeded to make a final determination on a

summary judgment basis that the claim was statute-barred and amounted to an abuse of process. However, I need not decide whether the Chambers judge was entitled to convert what appears to be an application to strike under Rule 7-9 into substantially an application for

summary judgment based on abuse of process in the circumstances of this case. The bottom line is that the claim must be struck under Rule 7-9(2)(

e) on the basis it is an abuse of the process of the court. Messrs. Campbell do not seek to reinstate their claim, whether it is dismissed or struck. VI. CONCLUSION [24] The doctrine of the abuse of process is flexible and is unencumbered by specific doctrinal requirements, and a court may therefore strike pleadings as an abuse of process in a wide variety of cases. [ 25 ] In the case at hand, the Chambers judge found, as a matter of fact, that the plaintiff had knowledge of all the facts that would cause the plaintiff’s claim to be statute barred and struck the claim as an abuse of process.

This is within the doctrine of abuse of process as contemplated by the Supreme Court of Canada in Toronto and has been held to be a proper use of the court’s jurisdiction in Campbell . The appellant does not seem to take issue with the Chambers judge’s conclusion that the claim was statute barred and therefore an abuse of process on the basis of the evidence before him. Rather, the appellant seems to argue that the Chambers judge should not have struck the claim pursuant to Rule 7-9(2)(

e) because, by virtue of the respondent having brought the application under that rule, the appellant was deprived of the opportunity to know the case he had to meet and marshal the appropriate evidence in response. [ 26 ] This submission of the appellant is without merit. The respondent’s application clearly set out the nature of the relief that was sought.

The appellant thereby had notice that the respondent had applied to strike his claim on the basis of the expiry of the limitation period and, therefore, had the opportunity to adduce evidence to meet that case. [ 27 ] There was no error on the part of the Chambers judge in the use of his discretion to strike the statute barred claim as an abuse of process under Rule 7-9(2)(e). To be clear, there is no suggestion that this decision endorses striking a claim pursuant to Rule 7-9(2)(

a) as the basis of an expired limitation period that would be contrary to the views expressed by this Court in Semenoff v Forrie , 2008 SKCA 55 , 310 Sask R 158. The Chambers judge was not required to direct the respondent to the processes established in Rules 7-1 or 7-2. [ 28 ] The appeal is dismissed with costs to the respondent, which I fix at $1,500.00. “Whitmore J.A.” Whitmore J.A. I concur. “Tholl J.A.” Tholl J.A. I concur. “Kalmakoff J.A.” Kalmakoff J.A.