Appeal court says horizontal stare decisis didn’t bind it to follow its prior ruling
Revisiting its prior decision that subsequent jurisprudence had since overtaken, the British Columbia Court of Appeal ruled that an associate judge had jurisdiction to decide whether to set aside a default judgment without breaching s. 96 of the Constitution Act, 1867.
In 1991, in Euro Ceramics Tile Ltd. v. T & C Ceramic Tile Contractors, 1991 CanLII 1463 (BC CA), the BC Court of Appeal held that an associate judge lacked jurisdiction to decide whether to refuse to set aside a default judgment because it violated s. 96.
On Feb. 10, 2025, in Smith v. VM Agritech Limited, 2025 BCSC 206, a chambers judge of the Supreme Court of British Columbia affirmed an associate judge’s refusal to set aside a default judgment. Describing Euro Ceramics as no longer good law, the chambers judge determined that an associate judge had jurisdiction to decide to refuse to set aside a default judgment.
The appellants in the present proceeding – VM Agritech Limited v. Smith, 2026 BCCA 101 – appealed the chambers judgment. They alleged that an associate judge lacked jurisdiction over a set-aside application.
The appellants argued that the chambers judge erroneously found that vertical stare decisis did not bind her to follow Euro Ceramics.
The appellants explained that the chambers judge violated vertical stare decisis in determining that the associate judge had such jurisdiction because the appeal court had previously held that this would breach s. 96. The appellants added that the circumstances that would entitle a judge not to follow an otherwise binding precedent did not apply here.
Alternatively, the appellants asserted that the chambers judge misapprehended critical evidence concerning the delay in filing their response to the underlying civil claim.
Chambers judge’s order not disturbed
The Court of Appeal for British Columbia dismissed the appeal upon finding no inconsistency between s. 96 and an associate judge’s jurisdiction to set aside a default judgment.
The appeal court found no error in the chambers judge’s refusal to adhere to Euro Ceramics or assessment of an associate judge’s jurisdiction.
First, the appeal court ruled that horizontal stare decisis did not bind it to abide by its prior ruling in Euro Ceramics, which had been decided per incuriam (or through a lack of care) and without considered submissions.
The appeal court added that the Supreme Court of Canada’s decision in Attorney-General for Ontario and Display Service Co. v. Victoria Medical Building et al., 1959 CanLII 20 (SCC), [1960] SCR 32, did not support the result in Euro Ceramics.
The appeal court did not consider an associate judge’s jurisdiction to hear an application to set aside a default judgment analogous to a master’s jurisdiction to hear an action’s trial on the merits as if the master were a judge.
The appeal court found Euro Ceramics inconsistent with the Supreme Court of Canada’s:
- approval of Polson Iron Works v. Munns, 1915 CanLII 340 (AB KB), which confirmed that a master could order a final judgment without a genuine issue for trial
- conclusion that a master’s jurisdiction to determine whether there was no real issue for trial as a precondition for making an order did not violate s. 96
Second, even if Euro Ceramics had correctly followed Victoria Medical, the appeal court held that the jurisprudence had since sufficiently evolved to overtake Euro Ceramics and justify reconsidering the issue.
According to the appeal court, an associate judge’s jurisdiction over whether to set aside a default judgment did not breach or even touch the core jurisdiction of s. 96 Supreme Court judges, who exercised supervisory authority over associate judges’ work.
“Associate judges or masters have, since before Confederation, facilitated the work of s. 96 judges by addressing procedural, administrative and other preparatory work necessary to prepare matters for trial or final adjudication on the merits,” wrote Justice David C. Harris for the appeal court.
The appeal court distinguished between a trial judge’s core duties and a decision whether to set aside a default judgment arising from a failure to meet procedural requirements, even if it entailed an analysis of whether there was a viable defence.
“The Supreme Court of Canada, and other courts, have recognized that the constitutionally protected jurisdiction of superior courts is not frozen in time, and provincial authority over the administration of justice encompasses the ability to reform practice and procedure to make the work of the courts more efficient and to enhance access to justice,” Harris wrote for the appeal court.
The appeal court added that limiting an associate judge’s jurisdiction to decide whether to set aside a default judgment would interfere with those goals.
Lastly, the appeal court determined that the associate and chambers judges did not misapprehend the facts. The appeal court found the chambers judge entitled to draw the conclusions she did.
