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Newsletters 2003 > August 2003

But it was an Accident?
What you should know about delay and Notice of Status Reviews in plaintiff side litigation in the Federal Court of Canada.

If your work requires that you pursue claims in the Federal Court of Canada, there are some things you should know about being a plaintiff, delay and Status Reviews.

At the beginning of August, the Federal Court issued another decision, in Narsimhalu v. Air Canada [2003] F.C.J. No. 1243, showing the seriousness of Notice of Status Reviews in the Federal Court. The specific facts of the case are largely irrelevant, but the court's message is plain: If you do not pursue your client's Federal Court Claim, the Federal Court of Canada will dismiss your action.

New Federal Court Rules came into effect on April 25, 1998 creating a scheme of case management. As part of this scheme, Status Reviews were created. In the past five years, the Federal Court of Canada has taken a decidedly firm stance with its application of Status Reviews. This is in contrast to the view many Provincial Courts have towards typical dismissals for delay and status reviews.

Initially thought of as a mere "reminder" from the Court, or a "slap on the wrist" to move a matter along, the Federal Court has made it quite clear that Status Reviews potentially carry a Draconian consequence. Inexplicable delay or a lack of concrete proposals to move a delayed matter along will result in a plaintiff's claim being dismissed. Prejudice is not required and a claim may be dismissed without any effort whatsoever from the defendant.

Typically in motions to dismiss for delay, the courts are reluctant to extinguish a litigant's chance for a day in court based on delay. Usually an unexplained passage of years coupled with real evidence of prejudice is necessary for an action to be dismissed for delay. Further, it is incumbent upon the defendant to initiate the motion to dismiss for delay. Typically, a court will not do this motion on its own initiative. A lax attitude by the defendant moving party will usually affect a court's decision to dismiss the plaintiff's claim for delay. Needless to say, motions to dismiss for delay in Ontario courts are very rarely granted to a defendant. These motions are typically not used to dismiss an action but are used as a tool to pressure the defaulting plaintiff to proceed with its litigation.

The Ontario Superior Court also has a status review provision. Rule 48.14 of the Ontario Rules of Civil Procedure provides that if a statement of defence has been filed and the action has not been placed on a trial list or terminated within two years after the filing of a statement of defence, the registrar shall serve a status notice that the action will be dismissed for delay. Despite the delay, the action will not be dismissed if within the 90 days, the action has been set down for trial or if a court orders otherwise.

All of these actions serve as a "wake up" call to plaintiffs. If counsel moves quickly enough, a dismissal is easily avoided if there is no prejudice to the other side. The Federal Court's Notice of Status Reviews are much different.

The Court's decision to dismiss a plaintiff's action, on its own unilateral initiative, has been upheld in the Federal Court of Appeal on various occasions. In fact, an appeal upholding a Trial Division Court's decision to dismiss under a Status Review was appealed to the Supreme Court of Canada on various grounds. The Supreme Court of Canada did not interfere with the decision. It denied the appeal with costs and without reasons. (see Importations Alimentaires Stella Inc. v. National Cheese (F.C.A.) [2000] F.C.J. No. 1816 affirming [1999] F.C.J. No. 834 which affirms [1999] F.C.J. No. 702; and Rosen v. Canada [2002] F.C.J. No. 415 (F.C.A.), para. 5, leave to appeal to S.C.C. refused [2000] S.C.C.A. No. 224)

A Notice of Status Review is a single page notice sent by the Court to Plaintiff's counsel. It is sent where 180 days have passed since the issuance of the statement of claim without a close of pleadings, or 360 days have elapsed without a requisition for a pre-trial conference. In this notice, the Court requests that the Plaintiff submit written representations to "show cause" why the proceeding should not be dismissed for delay. If the Court is not satisfied that the proceeding should continue, it will dismiss the action for delay. The defendant is then afforded an opportunity to make its own written submissions on the matter in rebuttal to the Plaintiff's Reply. If the Court is satisfied that the proceeding should continue, it will order that it continue as a specially managed proceeding.

In analyzing a Reply to a Notice of Status Review, the Court will analyze two questions:
1. Do the reasons why the case has not moved forward justify the delay?
2. What is the nature of the measures the party proposes to take to move the case forward?

"The two questions are clearly inter-related in that if there is a good excuse for the case not having progressed more quickly, the Court is not likely to be very exigent in requiring an action plan from the plaintiff. On the other hand, if no good reason is advanced to justify the delay, the plaintiff should be prepared to demonstrate that he recognizes that he has a responsibility to the Court to move his action along. Mere declarations of good intent and of the desire to proceed are clearly not enough. Likewise, the fact that the defendant may have been lax and may not have fulfilled all his procedural obligations is largely irrelevant: primary responsibility for the carriage of a case normally rests with a plaintiff and at a status review the Court will look to him for explanations."

The Court must address both the reasons for delay and the plan for moving the matter forward. The Plaintiff must present the Court with "concrete and positive" steps to advance the case.

If a court does dismiss a Plaintiff's case on Notice of Status Reviews, the Plaintiff may move to:
1) have the Court reconsider its order; and/or
2) appeal the Order.

As discussed above, the Federal Court of Appeal has refused appeals or motions to set these dismissal orders aside.

Lawyers beware!

D.Y.

 



 


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