Ranger v Precision, 2025 ABKB 45 highlights the importance for both insurers and defence counsel to move matters through court in a timely fashion. In Precision, the Alberta Court of King’s Bench confirmed the ultimate consideration in a delay application remains whether significant prejudice has resulted from the alleged delay. 

Background

The Plaintiff in Precision brought an action by Statement of Claim for wrongful dismissal and shareholder oppression in September 2012. In March 2024, the Defendant brought an application for delay under Rule 4.31 of the Alberta Rules of Court. The Applications Judge found the Plaintiff’s delay to be inordinate and inexcusable, resulting in a presumption of significant prejudice to the Defendant. On that basis, Defendant’s application was granted and the action was dismissed for delay under Rule 4.31. The decision was appealed by the Plaintiff.

The procedural steps taken in Precision included:

• September 2012 - Statement of Claim was filed;
• May 2014 - Questioning occurred;
• August 2017 - Consent litigation plan was entered; 
• January 2019 and January 2020 - Questioning on Responses to Undertakings occurred;
• January 2021 – Certificate of Trial Readiness was filed;
• February 2021 – Unsuccessful JDR occurred;
• November 2022 – Application under R 4.31 was filed, and was heard on March 26, 2024;
• December 2022 – Application to set matter down for trial was heard and granted, with trial scheduled for March 4-8, 2024;

Appeal

Rule 4.31 deals with delay and reads:

       4.31(1) If delay occurs in an action, on application the Court may 

(a) dismiss all or any part of a claim if the Court determines that the delay has resulted in significant prejudice to a party, or

(b) make a procedural order or any other order provided for by these rules.

(2) Where, in determining an application under this rule, the Court finds that the delay in an action is inordinate and inexcusable, that delay is presumed to have resulted in significant prejudice to the party that brought the application.

(3) In determining whether to dismiss all or any part of a claim under this rule, or whether the delay is inordinate or inexcusable, the Court must consider whether the party that brought the application participated in or contributed to the delay.

The parties heavily relied on the decision of Humphreys v Trebilcock, 2017 ABCA 116, where the Alberta Court of Appeal established a six-part test to interpret Rule 4.31^1. However, the Court emphasized a more recent decision, Transamerica Life Canada v Oakwood Associates Advisory Group Ltd., 2019 ABCA 276, where the Alberta Court of Appeal suggested the Humphreys test is helpful but clarified the ultimate consideration is significant prejudice:

In order to be struck, the action must generally fall within the slowest examples of that type of proceeding, and it must be so slow that the delay justifies striking out the claim. Further, even very short delays can be ground for striking the action if significant prejudice has resulted. “Significant prejudice” remains the ultimate consideration.  

The Court also reviewed the decision in Morrison v Galvanic Applied Sciences Inc., 2019 ABCA 207 where the Rule 4.31 analysis was refined into a three-part test:

(1)  A characterization of delay as inordinate triggers the query: has the nonmoving party accounted for the delay and does the explanation justify the pedestrian pace at which the action has been prosecuted?

(2)  If the adjudicator concludes the delay is both inordinate and inexcusable, the rebuttable presumption recorded in 4.31(2) comes into play.

(3)  It is the burden of the plaintiff to demonstrate on the balance of probabilities that the delay has not caused the defendant significant prejudice. [paras 13-15]

In Precision, the Plaintiff did not dispute the delay was inordinate but made two primary arguments as justification: (1) the Plaintiff’s personal circumstances and (2) the Defendant’s contribution to the delay.

Personal Circumstances

The Plaintiff’s employment was terminated in late 2019 and the Court found their ability to find new employment was negatively affected by the COVID-19 pandemic. The Plaintiff satisfied the Court they could not pay their legal expenses while looking for new employment, which ultimately delayed the litigation. The Court found it was reasonable in the circumstances for the Plaintiff to prioritize searching for new employment opportunities and the Plaintiff’s personal circumstances provided some justification for the delay.

Defendant’s Contribution to the Delay

The Plaintiff argued the Defendant contributed to the delay of the litigation: 

• the Defendant took over five months to file and serve a Statement of Defence;
• both parties took 35 months to provide Responses to Undertakings following Questioning;
• the Defendant took four months to agree to the litigation plan;
• the Defendant took eight months to agree to a date for Questioning of the Defendant’s corporate representative;

The Court attributed 48 months of the delay to the Defendant and found the delay to be excusable in the circumstances.

No Significant Prejudice

Since the Court found the delay excusable, the presumption of significant prejudice under Rule 4.31(2) did not apply. The onus was then on the Defendant to show significant prejudice arose from the delay.

The Defendant asserted its ability to defend its interests at trial had been impaired due to fading memories caused by the delay. However, the Defendant did not provide any particulars or provide evidence to demonstrate the prejudice alleged, and the Court found the “bare assertion” that memories are presumed to deteriorate as insufficient on its own. The Court noted the claim revolved around contractual interpretation and the relevant documents would be preserved for trial, which was the only remaining step in the action.

The Court held the action should not be dismissed under Rule 4.31 and allowed the appeal.

Take-Away

Precision confirms the ultimate consideration for Alberta courts in delay applications remains whether the defendant was significantly prejudiced by the delay. An inordinate delay is not required for an application under 4.31 to be granted so long as the applicant satisfies the court the delay was significantly prejudicial. 

Insurers and defence counsel should be cognizant that if they apply under Rule 4.31, any contribution made by them to the alleged delay could be used by the responding party as justification for the delay, including where both parties contribute to the delay. Insurers and defence counsel should be pro-active to ensure their files are moving forward in a timely fashion or, in cases where the opposing party is unresponsive, should document in written correspondence their willingness to move forward.

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¹The six-part test is: (1) has the nonmoving party failed to advance the action to the point on the litigation spectrum that a litigant acting reasonably would have attained with the time frame under review? (2) is the shortfall or differential of such a magnitude to qualify as inordinate? (3) if the delay is inordinate has the nonmoving party provided an explanation for the delay? If so, does it justify inordinate delay? (4) it the delay is inordinate or inexcusable, has this delay impaired a significantly important interest of the moving party so as to justify overriding the nonmoving party’s interest in having its action adjudged by the court? Has the nonmoving party demonstrated significant prejudice? (5) if the moving party relies on the presumption of significant prejudice created by rule 4.31(2), has the nonmoving party rebutted the presumption of significant prejudice? (6) if the moving party has met the criteria for granting relief under rule 4.31(2), is there a compelling reason not to dismiss the nonmoving party’s action?