Executive Summary: Key Legal and Evidentiary Issues

• The defendants applied to set aside a June 23, 2025 court order striking their response to civil claim, incorrectly characterizing it as a default judgment.
   
• That order was made on the basis of the defendants' willful and repeated failures to comply with court orders, and no appeal was taken from it.
   
• Following the striking of the response, a damages assessment hearing was held on December 9, 2025, which the defendants were served with but chose not to attend, resulting in damages assessed in excess of one million dollars.
   
• Defendants' counsel relied on Tchoubarov v. Poseidon Fishing Inc., 2023 BCSC 1448 to argue that the striking of a defence is akin to a default judgment and therefore subject to being set aside.
   
• Justice Weatherill reviewed the authorities cited in Poseidon and found they did not support the proposition that striking a response to civil claim is equivalent to a default judgment.
   
• Costs of the application were awarded to the plaintiffs at Scale B.

Facts of the case

The plaintiffs, Narrative Financial Services Inc. and Bradley Alan Pashby, commenced proceedings against 1263727 Alberta Ltd. (carrying on business as Axiom B.I. MC Group of Companies, Axiom Capital Inc., and Bruin Investments), Vincenzo De Palma, and Trina Dawn Redgwell. The defendants filed a response to civil claim on January 3, 2025. Due to the defendants' willful and repeated failures to abide by orders of the court, that response was struck by order dated June 23, 2025. No appeal was taken from that order.

On November 3, 2025, a notice to admit was served on the defendants regarding the assessment of damages necessitated by the June 23, 2025 order. The defendants did not respond to the notice to admit. A damages assessment hearing was then held on December 9, 2025. The defendants were served with that application and chose not to attend. Damages were assessed in excess of one million dollars, and no appeal was taken from the damages assessment order.

On January 30, 2026, the defendants applied to stay the judgment pending a further application to set it aside. That stay application was dismissed.

Policy terms or contractual provisions at issue

No specific contractual or policy terms are identified in this decision. The procedural issue before the court centred on the proper legal characterization of the June 23, 2025 order — specifically, whether the striking of the defendants' response to civil claim under Rule 22-7 of the Supreme Court Civil Rules is equivalent in nature to a default judgment capable of being set aside.

Reasoning and analysis

At the March 26, 2026 hearing, counsel for the defendants argued that the circumstances were analogous to a default judgment, and relied on Tchoubarov v. Poseidon Fishing Inc., 2023 BCSC 1448 (Poseidon), where Justice Wilkinson stated at paragraph 43 that where a defence is struck out under Rule 22-7, the defendant is generally deemed to have admitted the allegations of fact in the statement of claim, and the plaintiff is entitled to obtain a judgment as if on default for a liquidated amount or for damages to be assessed.

Justice Weatherill reviewed the authorities cited by Justice Wilkinson in Poseidon in support of those emphasized words. The first was The Law Society of British Columbia v. Gill, 2016 BCSC 2237, at paragraphs 22 to 23, and the second was Wisan v. Bountiful Elementary-Secondary School Society, 2018 BCSC 356, at paragraphs 64 and 67. Justice Weatherill found that neither of those paragraphs stands for the proposition that the striking out of a response to civil claim is akin to a default judgment.

In the Wisan decision, at paragraph 63, the court characterized an order to strike a party's pleadings for non-compliance with a court order as a Draconian remedy to be invoked only in the most egregious cases because it deprives the litigants of a trial on the evidence. Justice Weatherill further noted the passage from McIsaac v. Healthy Body Services Inc., 2009 BCSC 1716, cited within the Wisan decision, which confirmed that while a defendant whose defence is struck is deemed to have admitted the facts in the statement of claim, the court retains a discretion to permit the defendant to adduce evidence and cross-examine on issues essential to a fair determination of the loss actually sustained by the plaintiff. Justice Weatherill found that neither counsel was able to point to any authority supporting the proposition that striking a response to civil claim is akin to a default judgment, and concluded that the defaults in this case were willful, making any suggestion to the contrary simply not credible.

Ruling and overall outcome

Justice Weatherill dismissed the defendants' application to set aside the order. The plaintiffs were the successful party. Costs of the application were awarded to the plaintiffs at Scale B; the court did not make an order that costs be payable forthwith, as it found such an order unnecessary.