Canada: Dismissal For Want Of Prosecution: A Draconian Remedy No Longer

A recent decision from the British Columbia Court of Appeal has considerably altered the test for an application to dismiss an action for want of prosecution. Under the new revised test, applicants will no longer have to demonstrate serious prejudice as a pre-requisite, and the draconian reputation of the remedy has been diminished.

In Giacomini Consulting Canada Inc. v. The Owners, Strata Plan EPS 3173, 2023 BCCA 473 ("Giacomini"), the appellant suppliers of certain HVAC systems asked a five-member division of the BCCA to revise the long-standing test in British Columbia for dismissal of a civil action for want of prosecution. After the respondent strata corporation commenced the action in August 2019 due to alleged failures in the aforementioned HVAC systems, it took no further steps to progress its claim. The appellants eventually filed an application to dismiss the action for want of prosecution in January 2023, but it was dismissed by the chambers judge on the basis that prejudice to their litigation position could not be demonstrated – a component of the test, which the appellants claimed, exhibited a flaw in the existing approach.

WANT OF PROSECUTION: THE LONG-STANDING APPROACH

The starting point for the framework of a dismissal for want of prosecution was Irving v. Irving (1982), 28 B.C.L.R. 318 ("Irving"). After the plaintiff in Irving deliberately delayed for ten years in hopes the law would change to strengthen her claim, the Court of Appeal concluded that the public interest in the administration of justice demanded that such actions should not be allowed to proceed. Thus, the framework for applications to dismiss actions for want of prosecution was introduced.

Following Irving, and until Giacomini, the test for dismissal for want of prosecution was stated as requiring three conditions: (1) there has been inordinate delay, (2) the delay is inexcusable, and (3) the delay has caused, or is likely to cause, serious prejudice to the defendant. If those three conditions were established, the court still retained discretion to decide "whether or not on balance justice demands that the action should be dismissed" (Irving  at para 22).

The Court in Irving also cautioned that such applications should still give mind to the primary concern of the plaintiff's interest in an adjudication on the merits, endorsing an earlier decision from the English Court of Appeal, which found these applications to be draconian orders and not made lightly.

It is the third condition and the characterization of the order as "draconian" that fell under the scrutiny of the court in Giacomini.

CRITIQUE OF THE LONG-STANDING APPROACH

The argument of the appellants in Giacomini focused on whether the long-standing approach adequately balanced the range of interests at stake where litigation delay is concerned. Despite the obvious need to protect a plaintiff's interest in an adjudication on the merits, it was determined that the requirement to demonstrate serious prejudice to the defendant's ability to defend a delayed action prevented the court from giving appropriate weight to other factors relevant to the interests of justice (para 52).

One such factor was the public interest in a timely and efficient justice system. If inordinate and inexcusable delay was condoned so long as the delay did not result in prejudice to the defendant's litigation position, there would be insufficient incentive for the plaintiff to move a case forward with any sense of urgency (para 52). Plaintiffs could ignore express timelines set out in the Rules with confidence that they would not be at risk of the "draconian" remedy of a dismissal for want of prosecution, resulting in a "culture of complacency" towards delay in the justice system (para 53).

Furthermore, the narrow focus on litigation prejudice to the defendant failed to adequately account for the impact of unreasonable delay on the interests of the defendant that go beyond their ability to defend themselves (para 57). The long-standing approach accounted for prejudice to the defendant's litigation position, but in many cases, a defendant can suffer negative impacts to their personal, professional, or business interests. Undue delay may exacerbate these impacts.

Therefore, the court in Giacomini found that the current test "unduly focused on litigation prejudice to the defendant, at the expense of consideration of the broader impacts of delay on the defendants and the justice system more broadly" (para 58).

THE NEW APPROACH

Although the appellants in Giacomini proposed some potential revisions to the test for a dismissal of an action for want of prosecution, the BCCA opted for a simple and straightforward solution: the removal of "serious prejudice to the defendant" as a pre-requisite to an order dismissing an action for want of prosecution (para 63).

The BCCA endorsed the approach laid out by the Saskatchewan Court of Appeal in International Capital Corporation v. Robinson Twigg & Ketilson, 2010 SKCA 48 ("International Capital"). Under the test in International Capital, prejudice was not a stand-alone criterion to the analysis, but was rather "considered within the assessment of whether it is in the interests of justice for the case to proceed to trial notwithstanding the existence of inordinate and inexcusable delay" (para 65, citing International Capital at para 45). International Capital also set out the following non-exhaustive list of factors that are relevant to the court's assessment of the interests of justice, which were adopted by the BCCA in Giacomini:

1. the prejudice the defendant will suffer defending the case at trial;
2. the length of the delay;
3. the stage of the litigation;
4. the impact of the delay on the defendant's professional, business, or personal interests;
5. the context in which the delay occurred, in particular whether the plaintiff delayed in the face of pressure by the defendant to proceed;
6. the reasons offered for the delay;
7. the role of counsel in causing the delay; and
8. the public interest in having cases that are of genuine public importance heard on their merits.

In addition, the BCCA suggested that the merits of the action should also be considered alongside the above non-exhaustive list of factors.

Accordingly, the new approach is now summarized in Giacomini  as follows:

BUILDERS LIEN PLAINTIFFS BEWARE

While the test for dismissal for want of prosecution is the same in builders lien cases, lien claimants should be extra vigilant in moving their claims forward expeditiously. By their nature, builders lien claims carry the special privilege of securing the amount of the claim against the defendant's property prior to any determination of the claim's validity. The courts in British Columbia have found that this limited right to attach funds before judgment is an extraordinary remedy, which, carries with it an obligation to obtain an expeditious determination of the validity of the claim (see, for example, Parkerdean Plumbing and Mechanical Inc. v. Best Builders Ltd., 2019 BCSC 1969 at para 17 ("Parkerdean")). Where the plaintiff has the limited right to attach property or funds before judgment, a delay of just a few years can be considered inordinate (Parkerdean at paras 19-21). As such, lien claimants should make concerted efforts to take regular steps in the litigation or otherwise risk facing an application for dismissal for want of prosecution.

CONCLUDING REMARKS

This new approach to the test for a dismissal of an action for want of prosecution removes a significant hurdle for defendants seeking to dismiss a claim against them that has suffered an inordinate and inexcusable delay. The court sought to re-characterize the "draconian" reputation that surrounded this remedy, as "undue litigation delay undermines public confidence in the justice system, and should not be countenanced" (para 74). Therefore, the remedy is not excessively harsh or punitive – it is justified.

However, the court also emphasized that this change should not be taken as an invitation to bring such applications as a matter of routine. A plaintiff's right to a trial on the merits is still an important consideration, but the revised test "simply provides a more nuanced balancing of the competing considerations of defendants, and the justice system as a whole" (para 75). Furthermore, defendants should not simply sit back and count on a want of prosecution dismissal as a trump card – "[a] defendant's inaction in the face of lengthy delay by the plaintiff may weigh against dismissal of the action at the interests of justice stage of the analysis" (para 76).

Unfortunately for the appellants in Giacomini, not even the revised test offered them the remedy they sought – their appeal was ultimately dismissed as (1) the delay in the action was sufficiently explained by the complexity of the multi-party proceeding, (2) there was a lack of effort by the appellants to press the respondents to commit to a timeline during the delay, and, indeed, (3) there had been no demonstration of prejudice to their litigation position. However, their appeal may have opened the door for other defendants to remove a litigious thorn in their side, perhaps best summarized by the Court of Appeal as follows:

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