Commercial Litigation and Dispute Resolution Blog

In the recent decision of Wilyman v Cole, 2024 ABCA 41,^[1] the Alberta Court of Appeal canvassed the law addressing the “Vexatious Application/Proceeding Show Cause Procedure” under Civil Practice Note 7 (CPN7), and reiterated that this procedure is available in exceptional cases to strike applications or proceedings without the need for an oral hearing.

Background

The Appellant originally brought a malpractice action in April of 2003 (the 2003 Action) against the Respondents, Dr. Martin J. Cole and Martin J. Cole Professional Corporation. The 2003 Action alleged that the Appellant had suffered various harms arising from a procedure Dr. Cole performed in 2000.

The 2003 Action was struck in December of 2003.

In May of 2022, the Appellant sought to revisit his action by seeking permission to file a late appeal of the December 2003 order striking out the 2003 Action. When that application was denied, the Applicant commenced a new action against the Respondents (the 2022 Action), which centred on the Respondents’ alleged malpractice in 2000, but also detailed issues the Appellant had allegedly experienced since 2003, and referenced events which the Appellant alleged amounted to a cover-up and interference with the fair administration of justice.

By way of letter to the Chambers Justice, counsel for the Respondents asked the Court to strike the 2022 Action through the CPN7 procedure.

The Chambers Justice determined that the 2022 Action was a suitable candidate for the CNP7 procedure, on the grounds that it appeared on its face to be a collateral attack on the decision to strike the 2003 Action. Accordingly, the Chambers Justice invited the Appellant to provide submissions to justify why the 2022 Action should not be struck.

After reviewing submissions from both parties, the Chambers Justice struck the 2022 Action as a collateral attack on the decision to dismiss the 2003 Action, noting that while “the downstream consequences described in the [2003] and [2022] Statements of Claim are different, each starts from the same alleged events and negligence of Dr. Cole”.

Guidance from the Court of Appeal

CPN7 was adopted in September 2018 as a new way to implement the procedure through which a claim may be struck pursuant to Rule 3.68.^[2] CPN7 does not change the substantive law established by Rule 3.68,^[3] but rather changes the procedural requirements on the party whose claim is impugned.^[4]

Under the standard Rule 3.68 procedure, a party seeking to strike a claim must first file an application and supporting affidavit, and serve it on the opposing party. That party may then file a responding affidavit, and the parties may question on the filed affidavits. The matter will then typically be decided following an oral hearing in civil chambers, although the Court had the jurisdiction to resolve a matter in writing.

Under such procedure, the burden of proof is on the party seeking to strike the claim.^[5]

Under the CPN7 procedure, a party seeking to strike a claim may write to the Court asking that the procedure be invoked. If the Court is satisfied that the matter is suitable for resolution through CPN7, it notifies the party with the impugned claim that the Court is considering making an order staying or dismissing their claim. That party then has 14 days to file a response, and the party who requested the CPN7 procedure may respond to same. The Court then makes a determination based on the written record before it.

Under this procedure, little or no evidence is provided.^[6]

Three primary differences exist between the CPN7 procedure and the usual process for considering an application to strike pursuant to Rule 3.68:^[7]

• the procedure is initiated by the Court itself, although it may do so on written request from a party to the litigation, from a Clerk of the Court, or from the Court’s legal counsel;
• the procedure takes the form of a “show cause” hearing, which requires the litigant subject to CPN7 to justify their pleadings, effectively reversing the normal onus of proof for a Court application; and
• the procedure under CPN7 is based entirely on written submissions, without an oral hearing.

The Court emphasized that the CPN7 procedure is only available in “exceptional” circumstances, particularly when the effect of the decision is to terminate a party’s claim.

In order to avail itself of the CPN7 procedure, a party must establish not only that a pleading or application is deficient on its face, but also that there is some reason to prefer it over the normal Rule 3.68 procedure.

In particular, the party seeking to utilize the CPN7 procedure must establish that there is some justification for truncating the ordinary court procedure, eliminating an oral hearing, and shifting the burden of proof to the party whose claim is at risk of being struck or dismissed. This includes situations where a litigant is at risk of abusing the Court’s processes, or where a pleading or application is so hopeless that the ordinary procedure would be a waste of time, money, and resources. 

The Court noted that the Chambers Justice did not take this approach. While the Chambers Justice noted significant deficiencies in the Appellant’s pleadings, he failed to consider the question of whether the CPN7 procedure was preferable to the typical Rule 3.68 procedure.

However, the Court neglected to overturn the decision of the Chambers Justice, holding that the decision to employ the CPN7 procedure, and his characterization of the Appellant’s claim as a collateral attack, involved questions of mixed fact and law, reviewable on the standard of palpable and overriding error.

In upholding the Chambers Justice’s decision, the Court found that the connection between the two Actions was obvious, such that the 2022 Action was “clearly hopeless”.

In Closing

This decision serves as a reminder that the CPN7 procedure may be used as a means of quickly and inexpensively striking a deficient action or claim.

While a litigator should carefully consider whether the use of the CPN7 procedure can be justified before requesting it from a court, this procedure may be an ideal means of resolving claims that are abusive, clearly hopeless, or otherwise seriously deficient.

Footnotes

^{[1] Wilyman v. Cole, 2024 ABCA 41 [Wilyman]}

^{[2] Ubah v. Canadian Natural Resources Limited, 2019 ABQB 347 at para 25 [Ubah].}

^{[3] De’Medici v. Wawanesa Mutual Insurance Company, 2023 ABKB 210 at para 10 [De’Medici].}

^{[4] Wilyman at para 11.}

^{[5] Alberta Adolescent Recovery Centre v. Canadian Broadcasting Corporation, 2012 ABQB 48 at para 29.}

^{[6] Ubah at para 32; De’Medici at para 44.}

^{[7] De’Medici at para 9.}