Executive Summary: Key Legal and Evidentiary Issues

• Defendants sought to strike the Plaintiff's pleadings under r 3.68(4)(b)(ii) for alleged non-compliance with the document disclosure obligations in r 5.10 of the Alberta Rules of Court.

• Central to the dispute was whether the Plaintiff's delay of up to three years in disclosing 139 new records constituted a failure to "immediately" give notice under r 5.10(a).

• An alternative application under r 5.16 sought to bar the Plaintiff from using any previously undisclosed records, including critical 2024 Documents relating to the re-lease of lands and sale of the Annex Building.

• The Defendants further pursued dismissal for long delay under r 4.33, arguing no significant advance had occurred in three years, with this application hinging on the success of their r 5.16 argument.

• Proportionality of remedies emerged as a key issue, with the Court finding that striking pleadings or excluding evidence would be disproportionate sanctions for the Plaintiff's late disclosure.

• Timing and genuineness of the Plaintiff's May 14, 2025 production—just four days before the drop-dead date—were scrutinized to determine whether the steps constituted a meaningful advance or mere "housekeeping."

Background and facts of the case
Fort McMurray Airport Authority, as landlord, commenced an action on October 21, 2020, against 994552 NWT Ltd (the original lessee) and Nova Hotel Properties Ltd (the assignee under the lease), claiming damages for breach of a lease agreement. The Defendants responded by filing a Statement of Defense and Counterclaim on November 12, 2020, and the Plaintiff filed its Defense to Counterclaim on January 12, 2021. Discovery proceedings unfolded over the following years, with the Plaintiff providing its original Affidavit of Records on March 11, 2021, and the Defendants providing theirs on May 18, 2021. Questioning for discovery took place in 2021 and 2022, involving the Plaintiff's corporate representative Denean Robinson and former president Roelof-Jan Steenstra, as well as the Defendants' president, whose questioning on May 18, 2022, was regarded by the Defendants as the last significant advance of the action.

The Plaintiff's late production and the Defendants' applications
On May 14, 2025—just four days before the three-year anniversary of the last significant step—the Plaintiff's counsel sent the Defendants amended answers to undertakings of Robinson, answers to undertakings of Steenstra, and a Supplementary Affidavit of Records containing 139 previously undisclosed records. Of these, 86 bore dates earlier than the original Affidavit of Records, while the balance had dates after it, including documents from February 2024 relating to the re-lease of the leased lands and sale of the Annex Building. The Defendants challenged the genuineness of this production, contending it was a last-minute effort to avoid the drop-dead date. They brought applications seeking to strike the Plaintiff's pleadings under r 3.68(4)(b)(ii) for non-compliance with r 5.10, or alternatively to bar the Plaintiff from using the undisclosed records under r 5.16, and further sought dismissal of the action for long delay under r 4.33.

The disclosure obligations under r 5.10
Rule 5.10 of the Alberta Rules of Court requires a party who finds, creates, or obtains control of a relevant and material record after serving an affidavit of records to immediately give notice to the other parties, supply copies upon written request, and serve a supplementary affidavit of records prior to scheduling a trial date. The Defendants acknowledged the Plaintiff had complied with parts (b) and (c) of the rule but argued the Plaintiff failed to comply with part (a) by not giving immediate notice of the new documents. The Defendants urged the Court to interpret "immediately" strictly, consistent with foundational rule 1.2, which provides that the rules are intended to be used "to facilitate the quickest means of resolving a claim at the least expense." The Plaintiff countered that it had provided notice as documents were discovered or became known to be relevant, pointing to letters its counsel sent to counsel for the Defendants dated July 16, 2021, May 13, 2022, and May 16, 2022, and argued that the purpose of r 5.10 is to prevent ambush at trial rather than to create technical traps.

The Court's analysis on striking pleadings under r 3.68(4)
Applications Judge B.W. Summers noted the only case in Alberta that had considered an application to strike pleadings pursuant to r 3.68(4) on the basis of a failure to comply with r 5.10 was Dow Chemical Canada Inc v Nova Chemicals Corporation, 2015 ABQB 2, which was distinguishable on the facts. The Court emphasized that the interpretation of "immediately" in r 5.10 must be determined within the context of the case and that a literal meaning would not be appropriate when the discovery process stretches over years. Counsel for the Defendants candidly admitted he had found no prior case where pleadings had been struck under r 3.68(4) for a failure to give notice immediately under r 5.10(a). The Court found that even if the Plaintiff had failed to provide notice to the Defendants of new documents in a timely fashion, striking the Plaintiff's pleadings would be a disproportionate remedy, and noted that the monetary penalty available under r 5.12 would be much more appropriate in a situation such as this.

The alternative application under r 5.16 and the dismissal for delay under r 4.33
Turning to the r 5.16 application, the Court observed that no prejudice to the Defendants had been established—there was no trial by ambush and no adjournment of the trial. Barring the Plaintiff from using the new records, including the 2024 Documents, would also be a disproportionate remedy, as those documents dealing with the re-lease of the leased lands and sale of the Annex Building are apparently very important to the issue of damages and mitigation of damages. The application under r 5.16 was accordingly dismissed. As for the r 4.33 application, counsel for the Defendants candidly admitted during argument that his dismissal application hinged upon the success of the Defendants' application to exclude the new records under r 5.16. With that application having failed, the r 4.33 application was likewise dismissed. By way of obiter dictum, the Court additionally concluded that the 63 answers to undertakings and 139 new records provided on May 14, 2025, constitute a significant advance of the action considering their nature, value, importance, and quality, and that these steps were genuinely provided to move the action forward in a meaningful way and were not just "housekeeping."

Ruling and outcome
All three of the Defendants' applications were dismissed, making Fort McMurray Airport Authority the completely successful party. However, the Court awarded only half Schedule C costs to the Plaintiff as an admonition for its tardiness in moving the action, and in recognition that if the Defendants had asked for a monetary sanction under r 5.12, the Court would have granted one. The exact monetary amount of the costs award was not specified in the decision.