Alberta Court Provides “Road Map” for Summary Judgment Applications

This post was written prior to our January 2017 merger, under our previous firm name, MacPherson Leslie & Tyerman LLP.

In our prior blog we reported on the evolution of the procedural law respecting Alberta’s summary judgment procedure, and expressed the view that the values and principles underlying its interpretation will have general application to summary judgment regimes in other provinces. In particular we had highlighted Master Schlosser’s comments delivered at the Legal Education Society of Alberta’s Civil Litigation Refresher Seminar in late April. Master Schlosser’s comments foreshadowed a then pending decision which was released and published by the Alberta Courts earlier today.

In 1214777 Alberta Ltd. v. 480955 Alberta Ltd., 2014 ABQB 301 (121 v. 480) cross applications were advanced by a landlord and a tenant respecting their commercial lease. Both sides sought summary judgment. The landlord wanted the tenants out. The tenants wanted to stay and took the position that the lease had been renewed for a further term of five years. Master Schlosser held that the lease did remain in full force and effect as, in fact, it had been renewed by the parties’ actions. The landlord achieved a measure of success in that it was awarded amounts in rental arrears, which, if not paid within thirty days would result in termination of the lease. It appears that both sides recognized that the disputes could easily be sent to trial; but by the time they appeared before a trial judge the lease issue would be moot and the delay itself would likely have caused prejudice to one side or the other.

The primary change to the summary judgment regime is the introduction of the concept of proportionality. That concept urges the court to recognize that a full trial is not always the sensible and proportionate way in which to resolve legal disputes. Accordingly, the court should give summary remedies where it can. In 121 v. 480, proportionality definitely favoured the issues being dealt with on a summary basis, and thereafter the parties would be free to carry on with their respective business in accordance with the decision. This factual backdrop provides the vehicle for Master Schlosser’s articulation of a new approach to summary judgment applications.

The starting point, as found in the Alberta Court of Appeal decision in Windsor, concerns an examination of the record to see if a summary disposition that is fair and just to both parties can be made on the existing record. The court, in reviewing the record and the issue(s) in dispute, is to ask itself whether it is essential to the resolution of the dispute that the court see the witnesses. If the answer is yes, the matter must go to trial. If the initial answer is ‘no’, the court is to engage in the following six step process outlined on pages 3 and 4 of the decision:

  1. The court is to presume that the best evidence from both sides is before the court. The decided cases tell us that summary judgment applications have to be decided on the evidence before the court and not on what the evidence might be. Parties are required to put their best foot forward. This reinforces the importance of treating summary judgment applications advisedly and with due caution. The only caveat that might apply here is that if the summary judgment application is before a Master and the losing party does not like the Master’s opinion, it is not so difficult to patch up the evidence on appeal.
  2. As a corollary to number 1, the court is to ask whether a negative inference can be drawn from the absence of evidence on certain points.
  3. Next, the court should look at the evidentiary record on the application and ask whether all of the evidence is admissible. For example Rule 13.18 (3) of the Alberta Rules of Court provides that a court cannot rely upon hearsay evidence for an application that will finally determine the dispute.
  4. Next, the court should ask whether there is a conflict in the evidence and, if so, whether, (a) the conflict has been resolved on cross examination or, (b) whether the evidence giving rise to the conflict is purely self-serving and is otherwise unsupported. Self-serving evidence does not give rise to a triable issue.
  5. The next step is to examine the evidence. There are subtle distinctions here. The court may assess the sufficiency of the evidence, admissibility of evidence and reliability of evidence without access to enhanced fact finding powers. The court may also apply the law to the facts without deciding a genuine question of law. Assessing the sufficiency of the evidence will also involve considering whether the issue can fairly be decided on the factual record before the court.
  6. Having performed that evidentiary exercise, a plaintiff will be entitled to judgment if the plaintiff can prove all elements of the cause of action and the defendant either has no defence or is missing critical elements of proof necessary to maintain that defence. A defendant will be entitled to judgment if the plaintiff cannot prove an essential element of its cause or if the defendant has a complete defence.

Master Schlosser’s decision does not upset the well-established legal burden that an applicant must meet on summary judgment. The legal or persuasive burden is on the applicant throughout to satisfy the court, on the evidence, that the outcome is “plain and obvious”, or “beyond doubt”. If an applicant discharges the evidentiary burden imposed upon it on a balance of probabilities, the evidentiary burden then falls to the respondent to show that there is an issue of arguable merit, and a trial is required for its determination.

That being said, the Hryniak v. Mauldin decision from the Supreme Court of Canada does suggest that the threshold for granting summary judgment may be at the civil standard (balance of probability), rather than ‘plain and obvious’, or ‘beyond doubt’, which is closer to the criminal standard. The Supreme Court of Canada did not directly address this issue; however, there is an undeniable tension between the language used in the Hryniak case and the well-established standard for granting summary remedies. Until this issue is dealt with, when the court asks whether there is ‘any issue of merit that genuinely requires a trial’ (Windsor at para. 16), or whether a fair and just determination can be made on the merits, the threshold remains ‘plain and obvious’, ‘or beyond doubt’.

As Master Schlosser noted, it remains to be seen whether a judge or master sitting in chambers in Alberta can now find facts or determine credibility based on affidavit evidence. The developments in the law surrounding the summary judgment procedure have been both fast and dynamic. The concept of proportionality and the courts full embrace of the culture shift away from civil trials in favour of pre-trial determination procedures suggests that it will not be too long before we are able to report on alterations to the threshold test for summary judgment.