By Ian Carruthers and Noel Harper
DISCLAIMER: This blog is intended to inform the reader about how the law was applied in a particular case. It should not be taken as advice regarding the outcome of any other case, even one that may have similar facts. The Court’s decision will depend on the facts of each case. Please call 1-844-210-9511 or visit carrutherslaw.ca if you would like to learn more about your specific case.
In our introduction to service this week, we asked if an expiry date extension should be granted or denied and if anything within the case in question constituted a “special or extraordinary circumstance” by which to extend it. You can review Monday’s post here if you haven’t seen it yet.
In this case, there were no such circumstances and an extension was not granted, so the correct answer to this week’s question is d).
In McGowan v. Lang, 2015 ABCA 217, the plaintiff and defendant were involved in a car accident. The plaintiff negotiated for months with the defendant’s insurance adjuster, who in turn went to great lengths to communicate with the plaintiff’s lawyer about a statement of claim which was delivered beyond the deadline for service.
As a reminder, Rule 3.27(1) states:
The Court may, at any time, grant an extension of time for service of a statement of claim in any of the following circumstances:
(a) if a defendant, anyone purporting to be a defendant, or a lawyer or other person purporting to negotiate on behalf of a defendant, has caused the plaintiff or the plaintiff’s lawyer to reasonably believe and to rely on the belief that
(i) the defendant has been served,
(ii) liability is not or will not be contested, or
(iii) a time limit or any time period relating to the action will not be relied on or will be waived;
(b) if an order for substitutional service, an order dispensing with service or an order validating service is set aside;
(c) special or extraordinary circumstances exist resulting solely from the defendant’s conduct or from the conduct of a person who is not a party to the action.
According to the decision, “’special or extraordinary circumstances’ is qualified by the language in Rule 3.27(1)(c) which requires the existence of circumstances that result solely from the defendant’s conduct or from the conduct of a person who was not a party to the action,” and therefore, “an extension of time for service of a statement of claim under Rule 3.27 should not be permitted in circumstances where the failure to serve is caused by the plaintiff’s lawyer’s inadvertence, even in situations where there is no demonstrated prejudice to the defendants.”
Initially, the Master decided to grant the extension of time for service to the date on which the defendant was served, citing a phone message left by the defendant’s adjuster for the plaintiff’s lawyer in which the adjuster advised he would file a statement of defence if he did not soon receive requested documents. This “created the impression that the adjuster was satisfied with service as it stood.”
However, the Chambers Judge overturned the decision to extend the deadline and struck the late statement of claim as expired unserved. She said the adjuster’s actions in leaving the phone message for the lawyer in December 2012 – just ahead of the service deadline of January 27th, 2013 – did not constitute a special or extraordinary circumstance.
The adjuster’s threat of a statement of defence was not the reason that the statement of claim was never served, this was simply due to the lawyer’s neglect. The lawyer did not state that he relied on the adjuster’s message in his decision not to serve the statement of claim on time.
None of the events listed in this week’s question as possibly special or extraordinary circumstances – the adjuster’s frequent communication with the lawyer, his request for records in support of a settlement proposal, or his warning of a forthcoming statement of defence – created a situation that caused the plaintiff to miss the service deadline.
Practice Tip
Paragraph 35 of the decision, the “takeaway” from the appeal, states that “a lawyer acting for a plaintiff ought to file the statement of claim in a timely fashion and thereafter proceed to effect service of the statement of claim upon the defendant(s) as expeditiously as possible. After all, the only additional expense that will usually be incurred is the relatively small amount to be paid to the process server. This course of action will provide more time should service become a problem and resort must be made to either Rule 3.26 or other Rules regarding service. We say that service should still be effected even with a claim involving an insurer where the insurer may have either previously or concurrently been provided with a copy of the statement of claim.”
Your lawyer made a mistake. Is it malpractice?
As seen in this case, expired limitation periods are not the only risk faced by civil litigators. Missing the one-year service period after a statement of claim has been filed is equally detrimental. While most unsuccessful cases or applications occur despite a civil litigator’s reasonable efforts or for reasons beyond the lawyer’s control, they occasionally result from legal malpractice.
Have you or someone you know possibly suffered a loss due to the negligence of a lawyer or former lawyer? Carruthers Law can help identify how to repair the damage or, alternatively, help determine whether you should pursue a professional malpractice claim. Contact us for a complimentary consultation to discuss your situation.