Executive Summary: Key Legal and Evidentiary Issues

• Residential construction dispute over allegedly defective and substandard masonry work at the Peters’ home, leading to premature deterioration and water damage, with Countryside Masonry Inc. as the key defendant.

• The action, commenced in February 2016 over work completed by June 30, 2007, advanced very slowly: late document production, long gaps between key steps, and major questioning steps (including of Jamie Fry) cancelled twice at the last minute by the plaintiffs.

• The Court found the delay over eight years to be inordinate and unreasonable for what it described as a fairly straightforward residential construction dispute, despite intermittent activity and side-steps involving insurance and settlement.

• The plaintiffs provided only thin affidavit evidence from former counsel and did not give a detailed, fact-based explanation for the pace of document production, undertakings, expert replacement, or their failure to question central witnesses before they became unavailable.

• Significant prejudice to Countryside was both presumed and specifically found, given the age, illness, and likely unavailability of key witnesses (including Jamie Fry and John Terry) and the death of Robert Peters, coupled with fading memories about events up to a quarter-century old.

• Applying Rule 4.31 and the Humphreys/Transamerica framework, the Court allowed Countryside’s appeal and ordered that the action be stayed for long delay, leaving damages and other merits issues undetermined in this decision.

Facts of the case

The case concerns masonry work performed in 2003–2004 on the home of plaintiffs Ruth Peters and her late husband, Robert Peters. The masonry work was carried out by Jamie Fry, through his company Countryside Masonry Inc., as a subcontractor to Knightsbridge Homes, the general contractor on the project. Countryside’s part of the project was completed at the latest on June 30, 2007.

On February 4, 2016, the Peters and Rocky Mountain Ranches Ltd. commenced an action against Countryside, multiple Knightsbridge corporate entities, their principals personally, and various other individuals and corporations. The central allegation was that the masonry work had been done incorrectly and in a substandard manner, resulting in its premature deterioration and water damage to the home. The Claim also contained what the Court described as a “gossamer-thin” allegation of fraudulent concealment, based on an assertion that the defendants failed to tell the Peters that the work was poorly done. The Court noted that the limitations issue in this case would in reality turn on the interplay between any implied, industry-standard warranties and discoverability.

By the time the suit was commenced, Countryside had been inactive for many years and had been struck from the corporate registry. Jamie Fry had retired and was living on Vancouver Island. John Terry, his right-hand man on the project, was in ill health and had been living in Thailand since 2008.

Procedural history and conduct of the litigation

The plaintiffs filed an Amended Statement of Claim on September 9, 2016. Countryside filed its Statement of Defence on September 22, 2016, and the other defendants filed shortly thereafter. The plaintiffs served their Affidavit of Records on December 21, 2016. The major defendants served their Affidavits of Records by February 2, 2017, and Countryside served its Affidavit of Records on June 5, 2017.

No questioning occurred until March 2018, when the corporate representative of the Knightsbridge defendants was examined. In 2018, apart from that questioning and some discontinuances against peripheral defendants in May, little else of substance occurred.

Jamie Fry flew to Calgary in May 2018 to be questioned, but the plaintiffs cancelled his questioning at the last minute. He returned again for questioning on December 11–12, 2018, and the plaintiffs again cancelled at the last minute, over the strenuous objection of Countryside’s counsel. As a result, despite being the person directly responsible for the allegedly defective work, Fry has never been questioned, “by the Plaintiffs’ own choosing.” The Court noted that he is now battling a high-risk cancer and has lived abroad since 2021.

The only evidence filed by the plaintiffs on the delay application consisted of affidavits from their now-former counsel. In those affidavits, counsel did not explain the repeated cancellations of Fry’s questioning, other than to say that this afforded a “significant and material advantage to the plaintiffs.”

The defendants questioned Mrs. Peters in November 2019. It took until August 2020 to fully deliver her undertakings. Following that initial questioning, the Applications Judge summarized that there was “a long period of time when there was an insurance coverage dispute and there were discussions about insurance.” Settlement discussions and conversations about a Peringer agreement continued into early 2022. During the period from 2018 to 2022, months often passed without concrete advancement of the litigation, particularly as against Countryside.

During this interval, Robert Peters died. He had never been questioned, even though the record before the Court suggested that he was “the driving force” behind the project, that he preferred to do business without written contracts, and that he insisted on many variations in the work that may have compromised functionality for aesthetic reasons. The plaintiffs’ original expert witness also passed away.

In August 2022, Countryside’s expert became ill, but Countryside promptly retained a replacement, who conducted a site visit later that month. In the same month, Countryside questioned Mrs. Peters on her answers to undertakings and questioned a key former employee of the plaintiffs. Nonetheless, it took until May 2023 — almost a year — to receive Mrs. Peters’ full and final undertaking responses. The Court observed that there was no explanation for why initial answers and supplemental undertaking responses took so long in a case involving masonry work by a subcontractor without a written agreement.

After May 2023, nothing of substance occurred to advance the litigation until January 2024, apart from a request by the plaintiffs for dates for a Judicial Dispute Resolution (JDR). The Court described the utility of a JDR at that stage as “distinctly questionable,” as there had been no questioning of the defendants and no exchange of expert reports. The plaintiffs retained new counsel in June 2023, and the transfer of the file took until November 2023.

On the eighth anniversary of the litigation, in January 2024, Countryside brought its application to dismiss the action for long delay under Rule 4.31. At that point, the case remained far from trial. Neither of the people who had done the allegedly deficient masonry work had been questioned. Both were elderly, living in Thailand, and unwell, with affidavit evidence suggesting they would never be available for trial in person in Canada. The principal individual who had directed and paid for the work, Robert Peters, had died and could never be questioned. Final expert reports had not been exchanged. No JDR process had occurred. No trial dates had been booked.

The plaintiffs’ new counsel argued before Justice Devlin that the matter could be moved forward to trial within a relatively short time, particularly by using the Court’s new Civac (Civil Appearance Court) process. New counsel also initiated and completed a de bene esse virtual questioning of Jamie Fry in 2025. Justice Devlin noted, however, that Fry’s de bene esse testimony came into existence after the initial hearing of the Rule 4.31 motion and therefore did not factor into the delay analysis, although it could be relevant to prejudice and remedy.

The Applications Judge’s ruling

The Applications Judge accepted that there had been delay and agreed with Countryside that a trial would likely not be scheduled until 2027 or 2028. She nevertheless declined to find the delay inordinate. She concluded that more procedural steps had occurred in this litigation than in similar matters of equal age and that it was difficult for the Court to second-guess how long it should have taken to reduce the defendants to a single remaining party, particularly during the COVID-19 pandemic.

She ultimately held that there had been delay but that it was not inordinate “given all of the additional matters that were being dealt with,” and dismissed Countryside’s application.

Legal framework on long delay and governing principles

On appeal, the parties agreed that the governing test for long delay under Rule 4.31 is the six-step analysis from Humphreys v Trebilcock, as further expanded in Transamerica Life Canada v Oakwood Associates Advisory Group Ltd. Justice Devlin summarized that analysis as requiring the Court to consider: whether the plaintiffs failed to advance the action at a reasonable pace; whether the delay is significant enough to be unreasonable; whether any explanation justifies inordinate delay; whether the delay has been significantly prejudicial; whether any presumption of prejudice has been rebutted; and whether there is any compelling reason not to dismiss the action.

The Court emphasized that the objective is to determine whether the delay is inordinate, inexcusable, or has otherwise caused significant prejudice to the defendant. Justice Devlin noted that there is no mandatory formula for determining long delay applications and that each piece of litigation has unique facts and context. What constitutes a reasonable pace must be assessed in light of the nature and complexity of the issues and evidence, and the history of the litigation.

Justice Devlin also referred to Rule 1.2(1) of the Alberta Rules of Court, which states that the purpose of the rules is to provide a means by which claims can be fairly and justly resolved in a timely and cost-effective manner. He summarized key principles from prior decisions, including that:

• the foundational rules make timely and cost-effective dispute resolution the raison d’être of the civil system;
• the plaintiff bears the onus to move the action forward;
• delay is distinct from complete inaction and is concerned with whether the case is substantively advanced;
• the core concern of Rule 4.31 is prejudice;
• once inordinate or unreasonable delay is established, prejudice is presumed; and
• dismissal for delay requires significant prejudice and remains a discretionary remedy.

The Court cited and adopted principles from cases such as Humphreys, Transamerica, Condominium Corporation 052 058 (The Tradition at Southbrook) v Carrington Holdings Limited, Jordan v De Wet, EMM Energy Inc v Canadian Natural Resources Limited, and others, reinforcing that parties must conduct themselves according to the “prime directive” of timely, cost-effective dispute resolution and that courts are increasingly unwilling to tolerate a culture of chronic civil delay.

Court’s analysis of inordinate delay and explanations

Justice Devlin agreed with the Applications Judge that there had been delay, but disagreed with her conclusion that the delay was not inordinate. He described inordinate delay as delay “much in excess of what was reasonable having regard to the nature of the issues in the action and the circumstances of the case.”

He accepted the characterization of this matter as “a fairly straightforward residential construction dispute.” The defendants had performed masonry work at the plaintiffs’ home, the plaintiffs claimed the work was defective, and the essential factual and legal issues were straightforward: whether the work was substandard; whether there were reasons the work was done in a defective way that might shift liability to others; what damages, if any, could be proven to have flowed from any deficiencies; and whether the plaintiffs could overcome limitations issues.

Justice Devlin observed that the group of witnesses relevant to these core questions was relatively small. He identified Robert Peters and Jamie Fry as the first tier of principal witnesses; the two experts as the next level; Mrs. Peters and John Terry as understudies to the principals; and then the Peters’ staff member and the Knightsbridge representative as additional witnesses. He noted that neither of the tier-one principals would be available for trial: Mr. Peters was deceased and had never been questioned, and Fry’s de bene esse evidence arose only recently and he would almost certainly not be able to attend trial personally, and might not even be able to appear virtually. John Terry had not been questioned and, on the balance of probabilities, would also not be available for trial. Final expert reports had not been exchanged, and only the “bottom tier” of witnesses had been fully questioned.

Justice Devlin concluded that the state of readiness for trial — after eight years — in a relatively simple residential construction case was not reasonable. He noted it was difficult to rationalize how it took ten months to produce the plaintiffs’ Affidavit of Records, two years to reach the first questioning, the many months to answer Mrs. Peters’ undertakings after 2019 and again after 2022, and the lack of progress between May 2023 and January 2024.

He further held that the long periods spent on insurance coverage disputes, settlement, and Peringer agreement discussions — including roughly a year from December 2018 to November 2019 and a second year from September 2020 to August 2021 — did not excuse the failure to advance the core litigation against Countryside, which had always been known to be the material defendant. Justice Devlin relied on principles articulated by Mandziuk J in Carrington Holdings, emphasizing that the filing of a Statement of Claim is not merely an invitation to discussions and that formal, rule-based steps must occur in tandem with any informal activities.

He noted that the plaintiffs had not sought any agreement under Rule 4.32 to pause the litigation clock. At the time of the application, the parties would have been hard pressed to reach trial in 2027, more than ten years after the action began, with numerous basic steps still outstanding.

Justice Devlin regarded the plaintiffs’ cancellations of Fry’s questioning — especially where plaintiffs’ counsel admitted this provided a “significant and material advantage” — as an aggravating factor and an example of “games over getting on with it.” He characterized the case as having “drifted down the lazy river of business as usual” and stated that tacit judicial acceptance of “slothful civil suits” must end.

Overall, he found that there was “no universe” in which it was reasonable for a basic residential construction case to be unable to see a trial on the horizon after eight years, and that the reality of a decade-long path to trial in cases of low to moderate complexity reflected an entrenched culture of delay. He concluded that the delay in this case was inordinate and that Countryside had not contributed to it in any measurable way.

On the question of explanation, Justice Devlin observed that the plaintiffs filed only thin affidavits from former counsel and thus were not in a strong position to defend or explain the pace of the litigation. There was no detailed explanation for why the plaintiffs’ document production and responses to undertakings took so long in a case involving oral instructions and no written contracts. He found that the intra-counsel steps to create a Peringer agreement did not excuse the failure to advance the action against Countryside and that Countryside’s quick replacement of its own expert showed that expert replacement, in itself, did not justify substantial delay.

He also noted that the Applications Judge appeared to presume that COVID-19 explained some of the delay, but held that there was no evidence to support that conclusion, particularly as the matter was nowhere near requiring in-person court time. He ultimately held that no satisfactory explanation, backed by factual specifics, had been offered for the plaintiffs’ choice to move the matter so slowly.

Findings on prejudice and the Court’s exercise of discretion

Justice Devlin held that prejudice is presumed from long delay and also specifically found actual prejudice on the evidence. He described as unrealistic the idea that a seriously ill man of advancing age (Fry) could reliably defend himself through recall of conversations about building variations that occurred up to a quarter of a century earlier, particularly without corroboration from his former working partner. He found “very real prejudice” to Countryside, exacerbated by the plaintiffs’ delay.

He adopted prior observations that delay undermines the fair resolution of claims because witnesses’ memories erode and witnesses may relocate, become incapacitated, or die. He added that where an action is commenced long after the events at issue, plaintiffs face a “faster-ticking prejudice clock,” which heightens the risk that prejudice will be found if key litigation steps are not expedited.

Justice Devlin also addressed the superficial merits of the case. He stated that it was “far from certain that the action will succeed,” pointing to evidence from the plaintiffs’ maintenance manager that a water leak beside one of the impugned fireplaces and directly under the allegedly mis-installed terrace occurred in February 2012, four years before the Statement of Claim was filed, and that this was the last such water ingress he was aware of. He also noted the Knightsbridge principal’s evidence that all of the work would have been subject to the industry standard one-year warranty. He made clear that these observations were offered solely to forestall any concern that dismissing the action for delay would cause “a great and obvious injustice” to the plaintiffs, and that the record suggested the merits did not militate against dismissal.

He concluded that the delay had “a flavour of tactical choice” and that this was expressly admitted in relation to a key step directly connected to the prejudice (the cancellation of Fry’s questioning). He found that the matter remained far from trial and that active acquiescence in the delay was not alleged.

Exercising his discretion, and considering remedies short of a stay, Justice Devlin found no compelling reason to allow the action to continue. He determined that the prejudice to Countryside was real and mostly irremediable and that plaintiffs should not, in the circumstances, be permitted to proceed further with an aged and delayed action of this nature.

Ruling and overall outcome

Justice Devlin allowed Countryside Masonry Inc.’s appeal from the Applications Judge’s decision. He ordered that the action be stayed for long delay under Rule 4.31. The decision did not determine liability or quantify damages; instead, it resolved the long delay application in Countryside’s favour. The Court directed that the parties may speak to costs in writing within 30 days.