In Baron Real Estate Investments Ltd v Tri-Arrow Industrial Recovery Inc, 2026 ABCA 249, the Court of Appeal restored an action that had been dismissed for long delay under rule 4.33 of the Alberta Rules of Court. The sole question was whether service of a supplemental affidavit of records significantly advanced the action. The chambers judge said no, on the basis that the supplemental records went only to peripheral issues and should have been produced years earlier. The Court of Appeal disagreed on both points and allowed the appeal.
Baron is not an employment law case, but a Court of Appeal decision on a 4.33 application is important to civil litigation in Alberta generally, including employment law cases.
Facts
The following is a summary of the key facts, mainly focusing on the procedural timeline:
- There are several defendants in the action. Baron is the Plaintiff.
- Baron filed its statement of claim in April 2015 and an amended statement of claim in August 2015.
- Baron filed and served an amended amended statement of claim on the Defendants in April 2016.
- Statements of Defence were filed in May and June of 2016.
- Baron served its affidavit of records (“AOR”) in December 2016. The Defendants served their AORs in January 2017 and March 2018.
- Questioning was scheduled for September 2020, but was postponed in August 2020, on account of Baron’s counsel advising that they were preparing a supplemental AOR.
- Baron served its supplemental affidavit of records on March 22, 2021, approximately three years after the last affidavit of records was traded. Many of the supplemental records were documents that opposing parties had not produced in the litigation and could not say they possessed. Baron’s evidence was that it received these records from a former manager of the Defendants between July 2016 and late 2019, and that it took time to review them and assess relevance.
- The Defendants filed their 4.33 applications on August 3, 2021. This was approximately three years and five months since the original AORs were traded in March of 2018.
- The drop dead period considered here was actually 3 years plus 75 days. That 75 day extension past the usual 3 years was as a result of Ministerial Order 27/2020 issued during the pandemic. Baron acknowledged that service of the supplemental AOR was the only step within that 3 year, 75 day window capable of constituting a significant advance.
- The Applications Judge found that the service of the supplemental AOR constituted a significant advancement and dismissed the application. The matter was successfully appealed, with the Chambers Judge dismissing the action for long delay. Baron subsequently appealed to the Alberta Court of Appeal.
Analysis / Conclusion
Per the authorities summarized by the Alberta Court of Appeal, Rule 4.33(2) requires the Court to dismiss an action where three or more years pass without a significant advance. Assessing significance requires the Court to consider whether the step moved the lawsuit forward in an essential way, having regard to its nature, value, importance and quality, along with its genuineness and timing. The operative question, from Jacobs v McElhanney Land Surveys Ltd, 2019 ABCA 220, is whether anything in the period increased by a measurable degree the likelihood that the parties or the Court would have better information and be in a better position to rationally assess the merits and either settle or adjudicate.
Importantly, in framing the analysis, the court noted the following:
[18] In answering this question, it is helpful to remember that rule 4.33 is designed “to prune out actions that have truly died” (…) Steps that serve to narrow the issues, complete the discovery of documents and information, or clarify the parties’ positions may constitute a significant advance (…) “Each piece of litigation is unique and the content, value, and timing of the advance in the action said to ‘reset the clock’ must be assessed within the context of that lawsuit” (…)
[underline added, citations omitted]
The Court of Appeal found that the Chambers Judge (i.e. the Justice on the first appeal) erred in two ways. First, she had accepted that the supplemental AOR was relevant and material to the pleadings, but concluded that they related to “peripheral issues,” therefore not significantly advancing the action. The ABCA held that this reasoning was akin to summarily determining the claim, which is not the test to be met.
Second, the Chamber’s Judge had found that, because the creation date of most of the supplemental records predated service of the original AOR (i.e., pre-2016), the records were in Baron’s possession before the original AOR was produced, and accordingly, ought to have been produced earlier if they believed them relevant and material. The Chambers Judge likened the circumstances to XS Technologies Inc v Veritas DGC Land Ltd, 2016 ABCA 165 and Deja Vu Holdings Ltd v Securex Master Limited Partnership, 2018 ABQB 597.
The ABCA disagreed. While the timing of production, and whether the documents should have been served earlier is relevant, many of the records produced by Baron were documents created by the Defendants, which they had not produced, and accordingly, could not say that they were in their possession before service of the supplemental AOR. This distinguished the circumstances from XS Technologies and Déjà vu Holdings. The ABCA found that the chamber’s judge overlooked the fact that Baron did not create all of the records, and that the records creation date does not correspond with Baron’s possession date.
My Take
The most interesting principle from the ABCA comes from paragraph 18, cited above. Read holistically with the ABCA’s reasoning, the purpose of 4.33 Applications is not to necessarily search for technical shortfalls, but to genuinely determine whether the plaintiff has acted in a manner inconsistent with meaningfully pursuing the Action. Useful for plaintiff-side counsel is the refusal to allow the 4.33 application to become a determination of the merits. Baron serves as an important reminder that the pleadings frame whether the documents are relevant and material. Production does not require information required to resist summary dismissal.
Bow River Law provides these regular legal blog articles for the purposes of legal education and research for the public and the legal profession. These articles should be considered general information and not legal advice. If you have a legal problem, you should speak to a lawyer directly.
This post was first published on Bow River Law’s website blog.
