Date: 20220714  
Docket: CI 17-01-10369  
(Winnipeg Centre)  
Indexed as: Chief Orville Smoke et al v. Attorney General of Canada et al  
Cited as: 2022 MBQB 148  
COURT OF QUEEN’S BENCH OF MANITOBA  
B E T W E E N:  
CHIEF ORVILLE SMOKE, Chief of the DAKOTA  
) APPEARANCES  
PLAINS FIRST NATION on his own behalf and on )  
behalf of all MEMBERS OF THE DAKOTA  
) Faron J. Trippier, Karen R.  
PLAINS FIRST NATION and THE DAKOTA PLAINS ) Wittman and Sharna Nelko  
FIRST NATION,  
) Counsel for the plaintiffs  
)
)
plaintiffs, )  
)
)
-and-  
)
ATTORNEY GENERAL OF CANADA,  
THE GOVERNMENT OF MANITOBA, and  
THE CITY OF PORTAGE LA PRAIRIE,  
) Kosta L. Vartsakis and Chanel L.B.  
) Carlson (Articling Student)  
) Counsel for the defendant The City  
) of Portage la Prairie  
)
) Jim Koch and Sarah J. Zagozewski  
defendants. ) Counsel for the defendant The  
) Government of Manitoba  
) on a watching brief  
)
) Cary D. Clark and Rebecca C.  
) Akong (Articling Student)  
) Counsel for the defendant  
) Attorney General of Canada  
) on a watching brief  
)
) JUDGMENT DELIVERED:  
) July 14, 2022  
MASTER GOLDENBERG  
INTRODUCTION  
[1]  
The plaintiffs filed a statement of claim on October 16, 2017, which was  
amended by consent of the parties on November 27, 2017. The plaintiffs claim  
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against the defendants for misappropriation, trespass, nuisance, conversion,  
expropriation without compensation, loss of use, unjust enrichment, misfeasance  
in public office, breach of fiduciary duties, breach of the honour of the Crown,  
breach of trust and vicarious liability. Broadly speaking, the plaintiffs claim  
damages and certain other declaratory relief related to, among other things, the  
alleged misappropriation of their traditional lands by the defendants in or around  
1911. No statements of defence have been filed by the defendants. The  
defendant, The City of Portage la Prairie, (“Portage” or the “defendant”) has  
brought a motion to dismiss the plaintiffs’ claim against it for long delay.  
[2]  
For the reasons that follow, I dismiss the defendant’s motion.  
THE LAW  
[3]  
The motion is brought pursuant to Rule 24.02 of the Court of Queen’s  
Bench Rules, Man.Reg. 533/88 (“the Rules”). Rule 24.02, known as the long  
delay rule or sometimes the drop-dead rule, provides in part as follows:  
24.02 Dismissal for long delay  
(1) If three or more years have passed without a significant  
advance in an action, the court must, on motion, dismiss the action  
unless  
(a) all parties have expressly agreed to the delay;  
(b) the action has been stayed or adjourned pursuant to an order;  
(c) an order has been made extending the time for a significant  
advance in the action to occur;  
(d) the delay is provided for as the result of a case conference,  
case management conference or pre-trial conference; or  
(e) a motion or other proceeding has been taken since the delay  
and the moving party has participated in the motion or other  
proceeding for a purpose and to the extent that warrants the  
action continuing. [emphasis added]  
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(2) Excluded time— A period of time, not exceeding one year,  
between service of a statement of claim and service of a statement of  
defence is not to be included when calculating time under subrule (1).  
. . .  
(4) Transitional — no application to motions before  
January 1, 2019 — The court may only apply subrule (1) in a motion to  
dismiss an action for delay that has been brought after January 1, 2019.  
[4]  
The long delay rule came into force on January 1, 2018 (see Manitoba,  
Court of Queen’s Bench Rules, amendment, Man.Reg. 130/2017, section 43), but  
applies only to motions brought after January 1, 2019.  
PROCEDURAL CHRONOLOGY  
[5]  
The dates of consequence for this motion are as follows:  
October 26, 2017  
November 2, 2017  
The statement of claim is served on Portage  
Portage counsel ask plaintiffs’ counsel not to note  
Portage in default without reasonable notice  
Counsel for the plaintiffs grant a reasonable extension  
of time for Portage to file a defence and agree not to  
note Portage in default without providing reasonable  
notice  
November 6, 2017  
November 6, 2017  
Portage counsel thank plaintiffs’ counsel for the  
extension of time for filing a defence  
November 30, 2017  
January 1, 2018  
The amended statement of claim is served on Portage  
The long delay rule comes into effect  
October 11, 2018  
Plaintiffs ask the defendants to file and serve their  
respective statements of defence  
November 15, 2018  
December 13, 2018  
November 30, 2020  
December 9, 2020  
Plaintiffs’ counsel ask the defendants to file and serve  
their respective statements of defence within 30 days  
Portage serves counsel for the plaintiffs with a request  
for particulars  
Three years since the amended statement of claim  
was served  
Plaintiffs’ counsel ask the defendants to hold the  
action in abeyance while negotiations between the  
plaintiffs and the Attorney General of Canada are  
ongoing  
4
February 1, 2021  
Portage files the within motion to dismiss the plaintiffs’  
action for delay  
February 4, 2021  
February 5, 2021  
The motion for delay is served on the plaintiffs  
The plaintiffs file and serve their reply to the request  
for particulars  
ISSUES  
[6]  
The parties to this motion disagree on the following issues:  
1.  
2.  
3.  
Have all parties expressly agreed to the delay pursuant to Rule  
24.02(1)(a)?  
Does “excluded time” under Rule 24.02(2) include a period of  
one year where no statement of defence has been served?  
Have three or more years passed without a significant advance  
in the action?  
[7]  
The parties agree that none of the other exceptions set out in Rule  
24.02(1) (b) though (e) apply.  
ANALYSIS  
[8]  
There is some recent jurisprudence in Manitoba, including by the Court of  
Appeal, that addresses the question of what constitutes an express agreement to  
delay, including where, as here, the alleged express agreement occurred prior to  
the long delay rule coming into effect. Given this recent jurisprudence regarding  
an issue that may be determinative of this motion, I will address the express  
agreement issue first.  
Express Agreement to Delay  
[9]  
An express agreement to delay, sometimes referred to as a standstill  
agreement, operates to exempt the plaintiff from the strict application of the  
5
long delay rule. The parties disagree on whether they expressly agreed to any  
delay in this action. The defendant says there was no agreement to delay,  
express or otherwise; whereas, the plaintiffs say that there was an express  
agreement to delay the action from on or about November 6, 2017, until on or  
about October 11, 2018.  
[10] The express agreement alleged by the plaintiffs arises from the  
communication between counsel relating to the filing of the statement of  
defence. The totality of that communication was as follows:  
On November 2, 2017, Portage counsel wrote to plaintiffs’ counsel as  
follows:  
We have been retained to act on behalf of The City of Portage la Prairie  
with respect to the above-noted action commenced on behalf of your  
client, The Dakota Plains First Nation.  
At this point, we will need an opportunity to investigate and assess  
the matter. In the circumstances, we would kindly ask that you do  
not proceed to note our client in default in this matter without first  
providing our office with reasonable notice of your intention to do so.  
(Affidavit of Tracy Medina sworn January 28, 2021, Exhibit A)  
On November 6, 2017, counsel for the plaintiffs responded as follows:  
We acknowledge receipt of your correspondence of November 2, 2017.  
We are prepared to grant a reasonable extension of time in which to file  
a defence and further agree not to note default without providing  
reasonable notice of our intention to do so.  
(Affidavit of Tracy Medina sworn January 28, 2021, Exhibit B)  
On November 6, 2017, counsel for Portage wrote to counsel for the  
plaintiffs as follows:  
Thank you for your letter and your confirmation of an extension of  
time for filing a statement of defence.  
(Affidavit of Pauline Picton sworn March 30, 2021, Exhibit H)  
6
On October 11, 2018, plaintiffs’ counsel wrote to counsel for each of the  
defendants as follows:  
Although we understand that there have been some discussions  
between our clients and Ottawa regarding possible settlement of  
outstanding issues, in our view, until a settlement is in fact  
reached, we should move forward with the litigation. In that  
regard, we note that we do not yet have a Statement of Defence  
from any of the defendants. Accordingly, we ask that Canada and  
the other defendants kindly arrange to file their respective  
defences and provide us with a copy.  
(Affidavit of Tracy Medina sworn January 28, 2021, Exhibit E)  
On November 15, 2018, plaintiffs’ counsel wrote to counsel for each of the  
defendants as follows:  
We note that we still do not have defences from any of the  
Defendants. Please make arrangements to have your respective  
clients’ defences filed within thirty days.  
(Affidavit of Tracy Medina sworn January 28, 2021, Exhibit F)  
The Recent Manitoba Case Law  
[11] In Knight v. Daraden Investments et al, 2021 MBQB 125 (the “First  
Knight Decision”), I was the presiding master and determined that a similar  
agreement between counsel was not an express agreement to delay the action.  
That judgment was delivered on May 31, 2021. Two days later, a judgment was  
delivered by Greenberg J. in the case of Krasulja v. Manaigre, 2021 MBQB  
131, (“Krasulja”) in which a similar agreement was found to constitute an  
express agreement to delay. Counsel in the present case had the opportunity to  
make oral submissions on this motion with respect to Krasulja.  
[12] The First Knight Decision was overturned on appeal by Bock J. in  
Knight v. Daraden Investments et al, 2021 MBQB 279 (the “Second Knight  
7
Decision”) in a judgment delivered on December 23, 2021. Leave to appeal to  
the Court of Appeal has been sought on the Second Knight Decision, but the  
Court of Appeal’s decision on the leave application was still under reserve at the  
time of this judgment.  
[13] The First Knight Decision was overturned after the motion in the  
present case was argued, but before I had written my decision.  
I invited  
counsel to make written submissions on the Second Knight Decision, and  
have considered those for the purpose of this motion. Counsel also made written  
submissions on the Court of Appeal’s decision in WRE Development Ltd. v.  
Lafarge, 2022 MBCA 11 which was delivered on January 31, 2022, and I have  
also considered those submissions.  
[14] Part of my determination in this case will necessitate determining if  
Krasulja and the Second Knight Decision apply and are binding on me in the  
present case. The plaintiffs argue that I am bound by those decisions, whereas  
Portage argues that both are distinguishable.  
[15] In Knight, the defendants’ claims representative left a voicemail for  
plaintiff’s counsel asking whether they were required to file a statement of  
defence, and plaintiff’s counsel responded with a voicemail saying that no  
defence was required at the time. The claims representative confirmed the  
exchange of voicemails with an email and also wrote “in the event that a defence  
is required, we trust you will provide us reasonable time.”  
8
[16] In the First Knight Decision, I found that the while the plaintiff afforded  
the defendants the courtesy of not requiring them to file their statement of  
defence within the prescribed deadline, that there was no agreement, let alone  
an express agreement, to delay. I also questioned whether Rule 24.02(1)(a) can  
apply to agreements to delay in relation to the filing of a statement of defence  
given that Rule 24.02(2) expressly provides that a period of time, not exceeding  
one year, between service of a statement of claim and a statement of defence is  
not to be included when calculating time under subrule (1).  
[17] In Krasulja, the court considered similar communication between counsel  
and determined that it did amount to an express agreement to delay. In that  
case, the statement of defence was amended to add a counterclaim. At the time  
the amendment was served, defendant’s counsel provided plaintiff’s counsel with  
an email that said:  
I believe you required some time to file a Defence to the Counterclaim, I  
hereby give you an indefinite extension of time for that purpose.  
[18] Greenberg J. found that the filing of the counterclaim was a significant  
advance in the action that reset the three-year clock in the long delay rule.  
Alternatively, she found that the defendant’s agreement to extend the time for  
filing the defence was an agreement to delay the proceedings. She noted as  
follows at paragraph 32:  
32 The defendant argues that her counsel's email was a professional  
courtesy and not an agreement to delay. I am not sure how one  
determines the difference between the two especially when considering a  
"courtesy" or agreement that pre-dates the enactment of Rule 24.02. The  
email on which the plaintiff relies was sent before Rule 24.02 came into  
effect, so one might assume that the effect of the email on the  
9
application of the rule was not considered by counsel. But that does not  
mean it should be dismissed as merely a courtesy. The question is  
whether it evidences a clear intent to delay proceedings.  
[19] Greenberg J. refers to an Alberta Court of Appeal decision at paragraph 31  
of her decision in Krasulja, as follows:  
31 In Turek v. Oliver, 2014 ABCA 327 (), the defendant's  
motion to dismiss the action for delay was dismissed. Defendant's counsel  
had asked plaintiff's counsel for an extension of time to produce an  
affidavit of documents. The affidavit was not produced in spite of a follow  
up by plaintiff's counsel. Instead, a few months later, the motion to  
dismiss was brought. The Alberta Court of Appeal found that the  
agreement between counsel to extend the time to produce started the  
clock running again. Slatter J.A. explained:  
[6] Whether an agreement between counsel is sufficient to  
advance an action (and start the clock running again) will  
depend on the facts and circumstances. It was not  
unreasonable for the chambers judge to hold in this case,  
given the plethora of excuses advanced by counsel for the  
appellants, that it was not unreasonable for respondent's  
counsel to rely on it. The drop dead rule was never designed  
to encourage the sort of ambush that was unleashed here,  
after months of courtesies by one side and obfuscation and  
unresponsiveness by the other.  
[20] At paragraph 34 of Krasulja, Greenberg J. agrees with the analysis in  
Turek, as follows:  
34 There are not yet any Manitoba decisions interpreting Rule  
24.02(1)(a). I agree with the comments of Slatter J.A. that, as with an  
agreement in any context, whether there is an agreement and the nature  
of the agreement will depend on the facts and circumstances of the case.  
In oral argument, counsel for the defendant acknowledged that his email  
would preclude him from noting default on the counterclaim without first  
giving the plaintiff an opportunity to file a defence. Yet he argues that the  
extension he granted does not prevent him from holding the plaintiff to  
the strict letter of the three-year rule. (He filed the motion to dismiss  
three years and 13 days after the original statement of defence was  
filed.) In my view, counsel's concession that the email prevented him  
from noting default is confirmation of an agreement to delay proceedings.  
It would be reasonable for the plaintiff to assume that the proceedings  
were at a standstill, that is to say, to assume not only that the defendant  
would not note default without further notice but that she would not seek  
to dismiss for delay without further notice.  
10  
[21] Greenberg J. concludes in Krasulja at paragraph 35 as follows:  
35 Practice under Rule 24.02 is in an embryonic stage and undoubtedly  
will develop over time. It would be prudent in future for counsel to turn  
their minds to the rule and specifically address it in any agreement to  
delay proceedings. But agreements that pre-date the rule should be  
interpreted with some regard to past practice. I am satisfied that the  
email of July 9, 2018, was an express agreement to delay proceedings  
and that it is an answer to the motion to dismiss.  
[22] In Krasulja, the agreement found by Greenberg J. took place in July  
2018, that is six months after the long delay rule came into effect, albeit six  
months before the transitional period provided for at Rule 24.02(4). Subrule (4)  
provides that the court may only apply subrule (1) in a motion to dismiss an  
action for delay that has been brought after January 1, 2019.  
[23] In the Second Knight Decision, Bock J. applies a similar analysis with  
respect to considering alleged agreements that pre-date the long delay rule. He  
finds at paragraph 18 that the above noted correspondence between counsel  
that took place in August 2015, “constituted an express agreement to delay the  
proceedings, triggering the exception to the long delay rule in Rule 24.02(1)(a)”.  
In particular, at paragraphs 19 to 20:  
19 The essential elements of an agreement were present: an offer, an  
acceptance, consideration and a common intention to create a binding,  
legal arrangement. Ms. Thorburne's voicemail constituted the offer and  
the voicemail of plaintiff's counsel constituted its acceptance. The  
consideration included the plaintiff's forbearance from noting default  
during the agreed-upon delay in proceedings in exchange for the  
defendants' forbearance from taking advantage of any time limits which  
might expire during that period of delay. The parties' intention to create a  
binding legal arrangement is evidenced by, amongst other things, Ms.  
Thorburne's email memorializing it.  
20 Both sides benefitted from this agreement. The plaintiff gained time  
to assemble her claim and the defendants' insurer was spared the  
immediate expense of retaining counsel to defend what defendants'  
counsel fairly described during argument as a "run of the mill" slip and  
11  
fall claim. The advantages of such an agreement would have been  
obvious to both sides: it gave them an opportunity to arrive at a  
confidential, mutually agreeable settlement without any admission of  
liability, while avoiding the expense, inconvenience and stress of  
litigation.  
[24] Further, Bock J. indicates that he is in full agreement with the analysis of  
Greenberg J. in Krasulja and finds as follows at paragraphs 24 and 25:  
24 I agree with Greenberg J. Prudence dictates that parties who enter  
into an agreement to delay proceedings for the purpose of Rule 24.02(1)  
carefully indicate so in their agreement by, for instance, referring  
explicitly to the Rule. However, agreements like the one made by the  
parties in this case must be interpreted in light of the obvious fact that  
they pre-date the long delay rule.  
25 I am satisfied that the parties in this case agreed by their  
communications in August 2015 to delay proceedings until such time as  
the agreement had been terminated by one side or the other.  
[25] In WRE Development, the Court of Appeal considered the express  
agreement to delay exception for the first time. While the agreement in that case  
does not relate to the filing of a statement of defence, the court does set out a  
test for determining whether an express agreement to delay exists, and gives  
consideration to the agreement pre-dating the coming into force of the long  
delay rule. The Court of Appeal observed that “determining if [a standstill  
agreement] exists and its nature depends on the facts and circumstances of the  
case” (para 28). It referred to the test for finding a standstill agreement  
articulated in Bugg v. Beau Canada Exploration Ltd., 2006 ABCA 201  
(“Bugg”), a decision relied upon by both the parties in this motion. In  
particular, the following provisions from Bugg as set out in paragraph 31 in  
WRE Development:  
12  
31 In Bugg, the Alberta Court of Appeal explained the meaning of an  
express agreement in the following way (at paras 8-9, 18):  
Rule 243.1(1) dictates that a standstill agreement must be  
"express". Black's Law Dictionary defines that term as follows:  
Clear; definite; explicit; plain; direct; unmistakable; not dubious or  
ambiguous. Declared in terms; set forth in words. Directly and  
distinctly stated. Made known distinctly and explicitly, and not left  
to inference .... Manifested by direct and appropriate language, as  
distinguished from that which is inferred from conduct. The word  
is usually contrasted with "implied".  
Henry Campbell Black, Black's Law Dictionary, 6th ed.  
(St. Paul. MN: West Publishing Co., 1990.)  
In the context of R. 243.1(1), express means that the parties' intention is  
clear and not left to inference: Webber v. Canada (Attorney  
General), 2005 ABQB 718 at para. 54. A standstill agreement cannot be  
implied from conduct: 525812 Alberta Ltd. v. Purewal (2004), 366  
A.R. 1, 2004 ABQB 938 at para. 13. At the very least, the evidence must  
establish the basic elements of an agreement: for example, the identity of  
the parties to the contract, when the standstill began and its essential  
terms.  
It follows that a standstill agreement can be written, oral, or partly  
written and partly oral, as long as it is express and not based on intent or  
inference. This interpretation is consistent with Webber supra and  
525812 Alberta Ltd., supra. Because it will be more difficult to prove  
an oral agreement, the best course of action is to reduce the agreement  
to writing and specifically set out its terms. This Court has said: "when a  
standstill agreement is entered into, it would be preferable to describe it  
as such, and to state precisely what steps in the litigation process are  
waived  
or  
suspended  
pending  
the  
exploration  
of  
settlement": Wasyleshko v. Chamakese (1999), 228 A.R. 384, 1999  
ABCA 47  
[26] The Court of Appeal refers to the facts in two Alberta decisions where  
standstill agreements were found as follows at paragraphs 32 and 33:  
32 The test in Bugg was affirmed in Conway, where the Court upheld  
the chambers judge who found that an email exchange between counsel  
agreeing to hold matters in abeyance pending information on the  
solvency of several parties amounted to a standstill agreement. The Court  
considered that it was clear that the parties agreed to refrain from taking  
procedural steps until the solvency issue was determined.  
13  
33 As well, in Flock, the Court stated that an agreement to excuse time  
may be oral, but it cannot be implied and, under the rule, must be  
express; so conduct alone will not suffice. An exchange of  
correspondence will suffice if it is clear and precise enough (i.e., parties,  
start of period and essential terms) (see para 17(11)).  
[27] The Court of Appeal went on to refer to Krasulja at paragraphs 34, 37  
and 38 as follows:  
34 In Krasulja v Manaigre, 2021 MBQB 131, one of the issues was  
whether an email exchange between counsel granting an indefinite  
extension of time to file a defence to a counterclaim was an agreement to  
the delay. After noting the comments in Bugg and Conway regarding the  
meaning of an express agreement, Greenberg J stated that the question  
was whether the email exchange evidenced a clear intent to delay  
proceedings -- which she found was the case. She rejected the  
suggestion that something formal in the nature of a written contract was  
required, noting that there is nothing in r 24.02(1)(a) that suggests an  
agreement to delay need be in any specific form as long as it is express,  
that is to say, it must be clear.  
. . .  
37 In contrast to Bugg, this is not a case where the parties' intentions  
are clear and not left to inference. In saying this, I recognize that, as  
noted in Krasulja, agreements that pre-date r 24.02(1)(a) should be  
interpreted with some regard to past practice (see para 35). I also  
acknowledge that plaintiff's counsel believed that nothing further was  
needed to be done until the drawings were produced. However, neither  
the discussions after the examinations nor the follow-up emails make  
mention of anything resembling an understanding regarding delay or  
indicate that the parties turned their minds to holding matters in  
abeyance. Without more, merely requesting the drawings from the  
defendant that it undertook to provide and awaiting receipt does not  
evince a clear intent to have matters standstill pending their provision  
and amount to an express agreement to the delay. Rather, contrary to  
the plain wording of r 24.02(1)(a) and the jurisprudence, this would be to  
imply an agreement. The motion judge's conclusion, that there was no  
express agreement to the delay, is without error and is justified on the  
evidence.  
38 I pause to offer a comment about prudent practice going forward.  
While no specific form for an express agreement under r 24.02(1)(a) is  
required, the best course of action is for parties to turn their minds to this  
rule and, in circumstances where an express agreement to the delay is  
intended, to specifically address that agreement and its terms with  
reference to the rule (see Conway at para 32; and Krasulja at para 33).  
14  
The Defendant’s Position  
[28] The defendant’s position is that both Krasulja and Knight are  
distinguishable. Further, it says that a fact-specific inquiry taking into account  
the circumstances of this case, shows that there was no express agreement to  
the delay. Rather, following the analysis in WRE Development leads to the  
conclusion that the parties did not intend to create a standstill agreement.  
[29] In Krasulja, the court found that the indefinite extension granted by the  
defendant to the plaintiff to file a defence to counterclaim amounted to a  
standstill agreement that prevented the defendant from seeking to dismiss for  
delay without further notice. The present case, on the other hand relates to an  
extension given by the plaintiff to the defendant to file a defence to the  
statement of claim. Furthermore, in the present case the plaintiff did not offer  
an indefinite extension, rather it offered a reasonable extension of time for the  
defendant to files its statement of defence.  
[30] The defendant also distinguishes the exchange of communication in  
Knight that was found to create a standstill agreement, to the communication in  
the present case. In Knight, the exchange of communication that created the  
standstill agreement occurred between plaintiff’s counsel and the claims  
representative of the defendant’s insurer in August 2015. In that case, counsel  
for the plaintiff specifically advised the claims representative that no statement of  
defence was required at that time. Therefore, according to the defendant, three  
important facts distinguish Knight from the facts of this case:  
15  
1. It was not communications exchanged between counsel, especially  
respected and experienced counsel as is the case here;  
2. The communications occurred in August 2015, whereas in this matter the  
exchange occurred in November 2017; and  
3. Plaintiff’s counsel specifically advised that no statement of defence was  
required at that time whereas in this matter, counsel for the defendant  
merely asked counsel for the plaintiffs not to note the defendant in default  
without reasonable notice.  
[31] While the parties in Knight reasonably could not have foreseen the  
introduction of Rule 24.02 back in August 2015 when the communications were  
exchanged, in this case, Rule 24.02 had already been introduced (albeit not yet  
in force) prior to the exchange of emails between counsel for the plaintiffs and  
Portage in late November 2017. The defendant suggests that both counsel for  
the defendant and counsel for the plaintiffs are experienced litigators in the  
province. They also point out that the changes and, specifically, the introduction  
of the new drop-dead rule, were well publicized amongst the Manitoba Bar. If  
the parties intended to enter into an indefinite standstill agreement following  
service of the amended statement of claim on November 27, 2017, more would  
have been required to establish an agreement than a simple request by counsel  
for Portage not to note them in default or the granting of an extension to file a  
statement of defence.  
16  
[32] For example, had the parties intended to enter into a standstill agreement  
after Portage was served the amended statement of claim, they would have used  
similar language to that used by the plaintiffs’ counsel in this case in their letter  
of December 9, 2020, wherein counsel wrote:  
Given that the negotiations with representatives from Ottawa may be  
dispositive of some of the issues involved in the within action, we are  
hoping to discuss an agreement between the parties that this matter be  
held in abeyance while negotiations are ongoing.  
(Affidavit of Tracy Medina sworn January 20, 2021, Exhibit H)  
[33] The defendant suggests that if they had agreed to that proposal, then a  
standstill agreement would have been entered into as contemplated by Rule  
24.02(1)(a). That, however, was not the case in respect of the routine exchange  
of email correspondence following service of the statement of claim. If the  
intention of the parties was to hold the action in abeyance by virtue of this  
exchange of correspondence, counsel certainly would have used clear and more  
definite language, especially given that the new long delay rule has already been  
introduced. The defendant points out that not only was there no reference to the  
parties’ exchange of emails to the long delay rule but, more broadly, the  
exchange of emails in late November of 2017 between counsel for the parties  
does not even remotely indicate that the parties turned their minds to holding  
matters in abeyance.  
[34] Furthermore, the defendant takes the position that as Bock J. did not  
consider the excluded time provision in Rule 24.02(2) in the Second Knight  
Decision, my interpretation regarding the Rule’s applicability (or lack thereof) in  
the First Knight Decision in circumstances where a Statement of Defence has  
17  
not been filed, is still determinative. That is, where no statement of defence has  
been served, Rule 24.02(2) is not triggered and the plaintiffs are precluded from  
relying on that rule to exclude time from the delay calculation by reason of any  
extension of time to serve a statement of defence.  
The Plaintiffs’ Position  
[35] The plaintiffs argue that Krasulja and the Second Knight Decision are  
not only instructive on the issue of whether there was an express agreement to  
delay the proceedings as contemplated under Rule 24.02(1)(a), but also  
determinative of the issue. Furthermore, they point out that the reasons set out  
by Greenberg J. in Krasulja are referred to and accepted in the Manitoba Court  
of Appeal in WRE Development.  
[36] The plaintiffs argue that the facts underlying the within case are easily  
distinguishable from the facts underlying WRE Development, and are more  
similar to the facts in Knight and Krasulja. In fact, the plaintiffs argue that the  
facts of the current case show, even more clearly than in Knight, an express  
agreement to delay proceedings. The plaintiffs’ position with respect to the  
communications between the parties are as follows:  
November 2, 2017: counsel for Portage wrote to Plaintiffs’  
counsel requesting that Plaintiffs’ counsel not note Portage in  
default without providing reasonable notice. This constitutes an  
offer.  
November 6, 2017: Plaintiffs’ counsel wrote to counsel for  
Portage advising that the Plaintffs were “prepared to grant a  
reasonable extension of time in which to file a defence” and  
otherwise agreed that the Plaintiffs would not note default without  
providing reasonable notice. This correspondence constitutes  
either acceptance, or at a minimum, a counteroffer.  
18  
November 6, 2017: counsel for Portage responded to Plaintiffs’  
counsel expressly thanking Plaintiffs’ counsel for the extension of  
time in which to file a defence. This correspondence constitutes  
either memorialization of the agreement, as was the case in  
Knight, or acceptance of the Plaintiffs’ counteroffer.  
October 11, 2018: Plaintiffs’ counsel wrote to counsel for each of  
the Defendants, including counsel for Portage, requesting that  
they arrange to file their respective defences. This  
correspondence represents the termination date of the standstill  
agreement.  
November 15, 2018: having received no response to their  
October 11, 2018 correspondence, Plaintiffs’ counsel again wrote  
to counsel for each of the Defendants, including counsel for  
Portage, with a request that their respective defences be filed  
within 30 days.  
December 13, 2018: counsel for Portage served the Plaintiffs with  
a Request for Particulars. This action, the Plaintiffs say, evidences  
Portages’ understanding that the standstill agreement which was  
previously in place had come to an end.  
[37] The plaintiffs submit that the November 2017 exchange between counsel  
constitutes a clear, definite, explicit and unmistakable agreement. The parties  
are clear and identified. The date when the standstill agreement began is clear,  
that is November 6, 2017, when counsel for the plaintiffs responded to counsel  
for Portage’s request. What the parties agreed to is clear; that is, that: a) the  
plaintiffs agreed to provide a reasonable extension of time to allow Portage to  
file a defence; b) the plaintiffs agreed not to note Portage in default without  
reasonable notice; and c) Portage expressly confirmed its intention to file a  
defence. The plaintiffs suggest that there is nothing left to be inferred or implied.  
They say the standstill agreement was in place from November 6, 2017, until  
October 11, 2018, when the agreement was terminated and plaintiffs’ counsel  
requested that a defence be filed.  
19  
[38] Finally, with respect to the timing of the communications, the plaintiffs  
argue that the fact that the communications establishing the standstill agreement  
in Knight occurred in August of 2015 as compared to the correspondence  
exchanged in this case in November of 2017, is not an important distinguishing  
fact.  
[39] First, while the changes to the Queen’s Bench Rules may have been  
registered on October 2, 2017, they did not come into effect until January 1,  
2018. Further, the transitional period outlined in Rule 24.02(4) expressly  
provides that Rule 24.02(1) can be relied upon only in a motion brought after  
January 1, 2019, so as to allow the parties one year after the coming into force  
of Rule 24.02 to make a significant advance in the action.  
[40] Second, the correspondence considered in Krasulja, was from July of  
2018, that is, both post October 2017 and January 2018. Notwithstanding the  
fact that this correspondence post-dated the date that the new Rules came into  
effect, Greenberg J. nonetheless found that the correspondence constituted an  
express agreement to delay and fell into the category of agreements which pre-  
dated the Rule. Presumably, Greenberg J. was taking into account the delay of  
the implementation of the rule as provided for in Rule 24.02(4) and as described  
at paragraph 13 of her decision. Notably, the reasoning set out at paragraph 35  
of Krasulja was adopted by the Court of Appeal in WRE Development in  
paragraph 37.  
20  
[41] With respect to the defendant’s comparison to the communications by  
counsel on December 9, 2020, and the suggestion that had the plaintiffs truly  
intended to have the matter held in abeyance, that their correspondence from  
November 2017 ought to have more closely resembled the December 9, 2020  
correspondence, the plaintiffs say this argument fails for two reasons. First, the  
December 9, 2020, correspondence is completely temporally irrelevant to the  
issue of whether or not a standstill agreement was created in November of 2017  
given that the correspondence post-dates the Rules coming into effect. Instead,  
the correspondence would fall into the category of “future prudent process”, as  
contemplated by Greenberg J. in Krasulja at paragraph 35.  
[42] Second, the argument now being advanced by Portage in relation to the  
contents of the correspondence was expressly rejected by Greenberg J. in  
Krasulja. Portage is effectively asking the court to go beyond the express  
wording of the Rule and find that the magic word “abeyance” must be used in  
order for an agreement to delay to be found. Rule 24.02(1)(a) does not require  
that an agreement to delay be in any specific form so long as it is clear and  
express.  
Findings  
[43] Krasulja, the Second Knight Decision and WRE Development each  
accept that agreements to delay that pre-date the long delay rule coming into  
effect should be interpreted with some regard to past practice in light of the  
obvious fact that they pre-date the long delay rule. The focus in such an analysis  
21  
appears to be to determine whether there was a clear intention by the parties to  
delay the proceeding, even where they did not specifically use wording such as  
delay or abeyance.  
[44] Krasulja was not appealed to the Court of Appeal and I find that both it  
and the Second Knight Decision are binding upon me unless the facts are  
distinguishable. I do not agree with the defendant that the facts of the present  
case are sufficiently distinguishable such that the findings in Krasulja and the  
Second Knight Decision are not binding upon me.  
[45] While the alleged agreement in this case took place more than two years  
later than the one in Knight, it occurred eight months before the one in  
Krasulja. And, while the changes to the Rules had been registered by the time  
of the alleged agreement, they did not come into effect until January 1, 2018,  
and even then did not apply to motions filed before January 1, 2019. As noted,  
the agreement in Krasulja took place halfway through the transition period.  
[46] The fact remains that the long delay rule was not in effect in November  
2017, and I find that I must interpret the agreement with some regard to past  
practice in light of it pre-dating the long delay rule.  
[47] In WRE Development, the Court of Appeal considers whether there was  
an express agreement to delay relating to the provision of the defendant’s  
agreement/undertaking to produce construction drawings. The facts are  
distinguishable; however, the Court of Appeal does provide analysis on the  
22  
express agreement exception to the long delay rule including with respect to an  
agreement that pre-dates the Rule.  
[48] According to the Court of Appeal, even agreements that pre-date the long  
delay rule must demonstrate a clear intention to have matters held in abeyance  
or otherwise amount to an express agreement to delay. The defendant says this  
analysis must be applied on a case by case basis and when applied to the facts  
of the present case, show that the alleged agreement falls short of the test  
articulated in WRE Development.  
[49] The defendant says that the agreement in this case is different than in  
Knight, particularly because in Knight the plaintiff was not requiring the  
defendant to file a statement of defence, whereas in the present case the  
plaintiffs merely granted the defendant an extension of time to file its defence. I  
find that this difference is not enough of a distinction for me to not find an  
agreement on the same basis as the agreements found in both the Second  
Knight Decision and in Krasulja. All three cases deal with a practice that was  
commonplace between counsel, (or even as in Knight, with an insurance  
adjuster). Even though each agreement is to be considered on a case by case  
basis, I find that the Krasulja and Second Knight Decision analysis applies to  
the agreement in the present case. In all three cases the effect was the same: a  
statement of defence would not be required unless and until the plaintiffs in this  
case or Knight or the defendant in Krasulja, provided reasonable notice of that  
23  
requirement. I find based on these three authorities that the agreement in this  
case was an express agreement to delay.  
[50] The First Knight Decision was overturned, and while it is true that Bock  
J. does not refer to Rule 24.02(2) in his reasoning, he clearly found under facts I  
am unable to distinguish – including that a statement of defence had not been  
served – that there was an express agreement to the delay that obviated the  
need to dismiss the action. Therefore, I find it is not open to me to conclude in  
the present case that once the long delay rule came into effect on January 1,  
2018, that there could be no time excluded from the delay calculation except for  
any time between the service of the claim and defence. I do not agree that I am  
able to do so, as suggested by the defendant, simply because Bock J. did not  
address Rule 24.02(2) in The Second Knight Decision. Finding an express  
agreement to delay in these circumstances necessarily means this argument was  
rejected.  
[51] I therefore conclude that the parties entered into an express agreement  
to delay proceedings until December 15, 2018, when that agreement was ended  
by the plaintiffs by requesting the defendants file their defences by that date,  
which I consider to be the reasonable notice promised by the plaintiffs on  
November 6, 2017, and given on November 15, 2018.  
[52] Accordingly, three or more years had not passed between December 15,  
2018, and February 1, 2021, when the defendant filed the within motion and the  
motion must therefore be dismissed.  
24  
[53] Given that leave to appeal to the Court of Appeal has been sought in the  
Second Knight Decision, I will still address the other issues raised by the facts  
of this case.  
Excluded Time  
[54] The parties disagree on the interpretation of Rule 24.02(2). If the  
plaintiffs’ interpretation is correct, namely, that a period of one year is to be  
excluded even where, as here, no statements of defence have been filed,  
Portage’s motion would be premature because Rule 24.02(1) would not come  
into play until November 30, 2021, that is, four years after service of the  
amended statement of claim.  
[55] The interpretation of the excluded time provision in Rule 24.02(2) was  
considered by me in the First Knight Decision. In that case, the plaintiff urged  
me to adopt the same interpretation put forward by the plaintiffs in this case. I  
did not accept the interpretation advanced by the plaintiff.  
[56] The issue of the interpretation of the excluded time provision was not  
addressed in the Second Knight Decision. Bock J. determined the appeal on  
the question of whether there had been an express agreement to the delay.  
Having found that there was an express agreement to the delay, he did then not  
determine whether there was excluded time under Rule 24.02(2).  
[57] The issue of excluded time is of more significance in the present case  
because the defendant acknowledges that if the plaintiffs’ interpretation of  
excluded time is accepted by the court, that its motion for long delay was  
25  
premature. In the Knight motion, the defendants did not concede that point  
because they argued that there was still long delay even if the plaintiff’s  
interpretation was accepted, that is, even if there was one year of excluded time.  
[58] On the issue of excluded time, the defendant asks me to follow the First  
Knight Decision. The plaintiffs say that I ought not follow it because it was  
overturned and was wrong on the interpretation of Rule 24.02(2) and in any  
event, because the facts are distinguishable.  
[59] The plaintiffs argue that the First Knight Decision is distinguishable and  
that I did not have relevant jurisprudence in front of me, in particular that I did  
not consider two particular Alberta decisions (Kerr and Kirkness, infra), and  
instead premised my decision, at least in part, on another Alberta decision  
(Charik, infra) that did not actually consider the Alberta equivalent of Manitoba’s  
Rule 24.02(2). As such, they say, Charik offers little useful guidance on the  
interpretation of Rule 24.02(2).  
[60] The plaintiffs argue that, pursuant to Rule 24.02(2), the court is to  
exclude a period of one year following the service of the statement of claim  
when no defence is served. A problem with that argument is that Rule 24.02(2)  
does no expressly say that.  
[61] The plaintiffs also argue that while Rule 24.02(2) has received limited  
judicial consideration in Manitoba, it has been extensively considered in Alberta.  
A problem with that position is that Rule 24.02(2) itself has, of course, not been  
26  
considered extensively in Alberta; rather, Alberta’s legislation, which has had  
different iterations, has been considered to some extent.  
[62] The plaintiffs note that the original version of Alberta Rule 4.33(3)(a) is  
essentially the same as the current Manitoba rule. The previous Alberta rule  
provided in part as follows:  
Dismissal for long delay  
4.33(1) If 3 or more years has passed after the last thing done that  
significantly advanced an action, the Court, on application, must dismiss  
the action as against the applicant, unless  
(a)  
the parties to the application expressly agreed to the delay,  
. . .  
(AR 124/2010 S4.33; 140/2013)  
(3) The following periods of time must not be considered in computing  
periods of time under subrule (1):  
(a) a period of time, not exceeding one year, between service of  
a statement of claim on an applicant and service of the applicant's  
statement of defence;  
(AR 124/2010 S4.33; 140/2013)  
[63] The current Alberta rule, on the other hand, provides in part as follows:  
Dismissal for long delay  
4.33(1) In this rule,  
. . .  
(2) If 3 or more years have passed without a significant advance in an  
action, the Court, on application, must dismiss the action as against the  
applicant, unless  
. . .  
(4) The period of time referred to in subrule (2) does not include the  
following, whichever ends earlier:  
(a) the period of time between the service of a statement of  
claim on an applicant and the service of the applicant's  
statement of defence;  
(b) the period of one year after the date of service of a  
statement of claim on an applicant.  
. . .  
(AR 124/2010 s4.33;140/2013;85/2016)  
27  
[64] The plaintiffs, in my view, ask me to interpret Rule 24.02(2) as if it reads  
the same as the current Alberta Rule, when it actually reads substantially the  
same as the former rule. To the extent that it is helpful to consider Alberta  
jurisprudence regarding the interpretation of Rule 24.02(2), it will be important  
to keep this distinction in mind.  
[65] Rule 24.02(2) explicitly states that a period of time not exceeding one  
year between service of a statement of claim and service of a statement of  
defence is not to be included in calculating time. The defendant argues, as I  
found in the First Knight Decision, that in order for the rule to be triggered, a  
statement of defence must actually be served. The current Alberta rule, unlike  
both the Manitoba rule and former Alberta rule, expressly contemplates a period  
of one year being excluded after the service of a claim if a defence is not served  
within that year.  
[66] As I found in the First Knight Decision, I find that the Manitoba rule  
does not go that far. It only contemplates excluding the time between service of  
the claim and defence. I agreed with the defendants in that case that from an  
interpretation perspective, the absence of a provision in the Manitoba rules  
similar to clause 4(b) of the current Alberta rule, must mean something. To put  
in another way, the Rules Committee established under The Court of Queen’s  
Bench Act, C.C.S.M. c. C280, could have included a provision substantially similar  
to that of the later Alberta rule, but did not do so.  
28  
[67] In the First Knight Decision, the plaintiff argued that if I were to accept  
the defendant’s interpretation, there would be an absurdity, and the only way to  
avoid the absurdity would be to interpret the Manitoba rule as she urged me to,  
that is, that a period of one year is to be excluded where no defence is served.  
The suggested absurdity was that a defendant who took no steps to defend an  
action, could bring a motion to dismiss for long delay one year earlier than a  
defendant who served a statement of defence two years after service of the  
claim. I did not accept that this was an absurdity. A plaintiff who wishes to  
advance an action can always require that a defence be filed. For example, it  
could grant a finite extension of time as opposed to an infinite one, or could give  
notice to end the period of extension had an infinite extension been granted.  
[68] In the First Knight Decision, I did rely on Charik Custom Homes Ltd.  
v. Sara Development Inc., 2014 ABQB 63, in particular on the issue of  
whether there had been an express agreement to the delay. In Charik, the  
Alberta Court of Queen’s Bench addressed the effect of the defendant’s failure to  
file a statement of defence after receiving an extension of time. It is important  
to point out that the court in Charik was considering the former Alberta Rule  
4.33. While there is no analysis in Charik about excluded time under Rule  
4.33(3)(a), the court did dismiss the action for long delay after determining that  
there had not been an express agreement to the delay. There was no analysis  
on excluded time, but the facts of the case as set out at paragraph two were as  
follows:  
29  
“Nothing had happened since the statement of claim was  
served almost four years ago, except that shortly after service  
the defendants’ counsel advised the plaintiffs’ counsel that he was  
acting, and he requested the usual courtesy of taking no default  
proceedings without reasonable notice. The plaintiffs’ counsel  
agreed. Then the claim sat dormant.” (emphasis added)  
[69] If the plaintiffs’ interpretation is to be preferred, then on the facts in  
Charik, there would have been one year of excluded time after the service of  
the claim, and the long delay rule would not have come into effect until four  
years after the claim had been served. The motion for long delay would  
therefore have been premature because four years had not yet passed. The  
plaintiffs in Charik did not appear to argue that the motion was premature  
because there had been one year of excluded time. One might reasonably infer  
that was because the rule at the time only applied to situations where a  
statement of defence was served.  
[70] In the present case, counsel for the plaintiffs expressed concern with my  
reliance on Charik, which did not address the excluded time provision, and  
noted that I did not consider two other Alberta decisions: Kerr and Kirkness. I  
will refer to those now.  
[71] The former Alberta Rule 4.33(3)(a) is referred to in Kerr v. McDonald &  
Bychkowski Ltd., 2015 ABQB 473. The master found as follows with respect  
to Rule 4.33(3)(a):  
How is the period of delay calculated?  
15 Rule 4.33(1) provides for a 3 year period. Does Rule 4.33 (3)(a)  
apply to extend the period of delay for up to an additional year? Rule  
4.33(3)(a) states:  
30  
(3)The following periods of time must not be considered in  
computing periods of time under subrule (1):  
(a)a period of time, not exceeding one year, between  
service of a statement of claim on an applicant and  
service of the applicant's statement of defence;  
...  
16 Rule 4.33(3)(a) was discussed by the Rules of Court Committee ("the  
Committee") in the February 8, 2013 paper entitled Rules of Court  
Committee Results of Consultation "Drop Dead" Rule 4.33. At page 3, the  
Committee refers to this one year period as the "adjuster's year" in order  
to deal with the common situation where the Defendant seeks additional  
time to defend. This was considered to be a fair balance of the  
obligations of the litigants to advance the litigation. The Committee went  
on to recommend what has now become Rule 4.33(3)(a).  
17 Rule 4.33(3)(a) is meant to address a situation where a Statement of  
Defence has not been served. It gives the Court an opportunity to  
designate the date on which the Statement of Defence might reasonably  
have been served. This date would then be the last significant advance  
upon which the 3 year calculation would be based.  
18 This is in contrast to litigation where the Statement of Defence has  
been served. That service may be the last significant advance, or there  
may be other advances that qualify. Those qualifying advances start the 3  
year calculation and there is no need for the Court to try to determine  
what might be reasonable. The facts will speak for themselves.  
19 In this litigation, a Statement of Defence has been filed and  
presumably served. Rule 4.33(3)(a) does not apply. The clock started to  
run under Rule 4.33 on August 19, 2010, the date of the last significant  
advance, being the filing of the Affidavit of Records by the Defendant.  
The Rule 4.33 application was filed on August 29, 2014, being a delay of  
4 years and 10 days. This action must be dismissed for delay pursuant to  
Rule 4.33.  
[72] In the present case, the plaintiffs urge me to follow this interpretation of  
the extended time rule. Counsel argued that I should apply this analysis,  
including the suggestion that Rule 4.33(3)(a) in Alberta, and therefore Rule  
24.02(2) in Manitoba, is meant to address the situation where a statement of  
defence is not served. Counsel also argued that the service of a statement of  
defence automatically qualifies as a significant advance. Therefore, the plaintiffs  
say, there would be no need for Rule 24.02(2) if it did not apply to a situation  
31  
where no defence was served, because there is no need to extend time when a  
defence is served as the defence itself is a significant advance in the litigation.  
[73] The defendant’s position on the master’s decision in Kerr is that it is  
clearly incorrect and contrary to the rules of statutory interpretation. It notes  
that the rule clearly contemplates the service of a statement of defence.  
[74] I do not agree with, and am not bound by, the master’s decision in Kerr.  
On appeal, in Kerr v. McDonald & Bychkowski Ltd., 2016 ABQB 40, the  
parties agreed that the master had erred in determining that the defendant’s  
filing of its affidavit of records was the last significant advance in the action.  
They agreed that the master had overlooked a step in the litigation, namely,  
plaintiff’s counsel questioning a defendant representative that took place a year  
after the affidavit of records was filed. The issue on appeal was whether  
anything subsequent to that further step was a significant advance in the  
litigation. The court on appeal found that there had been no further significant  
advances in the litigation and found that there had been a period of three or  
more years without a significant advance in the action and therefore denied the  
appeal. There was no reference by the court on appeal to Rule 4.33(3) or to the  
master’s findings regarding that rule.  
[75] Without knowing exactly what Rule 4.33(3)(a) was “meant” to address, I  
nevertheless conclude that the master’s interpretation in Kerr does not make  
sense. If Rule 4.33(3)(a) was meant to only address a situation where a  
32  
statement of defence had not been served, why would the drafters have referred  
to the service of a defence?  
[76] Furthermore, I disagree with the plaintiffs’ argument in the present case  
that there would be no need for Rule 24.02(2) if it did not apply to a situation  
where no defence was served. In Krasulja, Greenberg J. refers to Déjà Vu  
Holdings Ltd. v. Securex Mask Limited Partnership, 2018 ABQB 597,  
where the court held that the defence to counterclaim filed by the plaintiff was  
not a significant advance in the action. The court in that case acknowledged that  
a pleading will usually significantly advance an action, but found that the defence  
in that case was a general boilerplate denial that did not amount to a significant  
advance.  
[77] Nor do I agree with the master’s comments in Kerr which seem to  
suggest that Rule 4.33(3)(a) gives the court an opportunity to designate the date  
on which the statement of defence might reasonably have been served. Applying  
that analysis to Rule 24.02(2), I do not agree that it gives the court any  
discretion to determine on what date a statement of defence ought to have been  
served.  
[78] The plaintiffs say that since Kerr, Rule 4.33(3)(a) has been amended to  
provide further clarification of the intent of the Rule and to make it expressly  
clear that the three-year clock does not begin to run until either after the  
statement of defence has been served or the one year adjuster’s year is  
complete. With respect, there is nothing before me to lead to the conclusion that  
33  
the Rule was amended to provide further clarification of the intent of the Rule.  
There is no evidence before me of what was intended by either version of Rule  
4.33(3)(a), let alone Rule 24.02(2). Nor is it appropriate to consider intention  
unless the Rule itself is ambiguous. Furthermore, as I noted in the First Knight  
Decision, the Alberta rule had already been amended when Rule 24.02(2) was  
implemented in Manitoba.  
[79] The plaintiffs also rely on Kirkness v. Emberley, 2019 ABQB 159, in  
support of their interpretation of Rule 24.02(2). It is important to note, however,  
that Kirkness considers the current Alberta Rule. In that case, the plaintiff  
served her claim on the defendant on December 7, 2014. The motion to dismiss  
for long delay was filed on November 30, 2018. At the time the motion was filed,  
the defendant had not filed or served a statement of defence.  
[80] The court considered the new Rule 4.33(4) and provides the following  
analysis as follows at paragraphs 15 to 17:  
Further time to be factored out  
15 The Rule goes farther: even once the claim is served, the "significant  
advance" clock is on hold until a defence is filed or one year elapses,  
whichever is shorter.  
16 Here the Rule is express: whichever post-service period applies, it  
does not count against the plaintiff when measuring a "no significant  
advance" period. If the shorter period applies (with a defence being  
filed), the plaintiff knows the claim is being defended and can now be  
expected to take steps to advance its claim, with knowledge of the  
defence.  
17 If the longer period applies (no defence filed within the year after  
service of the claim), the plaintiff is effectively told: "Do not wait any  
longer to see if a defence will be filed: proceed with your claim."  
[81] The court went on to apply Rule 4.33(4) to the facts of the case. The  
defendant had yet to file a defence. Accordingly, a full year after service of the  
34  
claim was to be factored out, and the application to dismiss for delay was found  
to be premature.  
[82] The plaintiffs say that the court in Kirkness concluded that the purpose,  
“as before”, was to provide a one-year period following the filing of a statement  
of claim before the three-year clock would start to run. With respect, there is  
nothing in Kirkness to suggest that the purpose of the new Rule 4.33(3) was  
the same as the old Rule 4.33(3). There is no analysis of the former Rule and  
accordingly, I find that Kirkness does not assist in my analysis of Rule 24.02(2),  
other than to highlight the differences in the current Alberta rule.  
[83] The plaintiffs also say that the First Knight Decision is distinguishable.  
In particular, they refer to paragraph 49 of the First Knight Decision at which  
I found that the defendants’ interpretation of Rule 24.02(2) did not create an  
absurdity. Specifically, I found that it is not an absurdity for Rule 24.02(2) to not  
apply to a situation where a statement of defence is not served. In particular, I  
noted, “In order to exclude time of up to one year, the plaintiff need only require  
that a statement of defence be served within the year.” The plaintiffs say I  
should distinguish the First Knight Decision because, in the present case, the  
plaintiffs did require that defences be served.  
[84] The facts of the present case do provide an example of the plaintiffs  
giving the defendants a deadline to file their defences and yet no defences were  
filed. The defendants as was their right, requested particulars. The plaintiffs  
35  
were then required under Rule 25.19(1.1) to either file and serve the particulars  
or a written statement refusing to do so within ten days.  
[85] The facts of the present case also do not convince me that the  
defendants’ interpretation of Rule 24.02(2) is absurd. The plaintiffs waited almost  
one year to require the defendants to file their defences, and then took more  
than two years to provide their particulars after requested to do so. The  
defendants were under no obligation to file their defences during that time  
period. It is not absurd that there is not an additional year of excluded time  
under these circumstances. If the Rules Committee is of the view that there  
ought to be excluded time even if a statement of defence is not served, it is  
open to them to amend the Rules as was done in Alberta.  
[86] I find that the wording of Rule 24.02(2) is clear and does not apply to a  
situation where a defence is not served. Therefore, I find that there is no  
excluded time under that Rule in the present case.  
Significant Advance  
[87] The defendant takes the position that there has been no significant  
advance in the action since the service of the amended statement of claim on  
November 30, 2017. The plaintiffs take the position that three steps occurred  
since the service of the amended statement of claim which separately or in  
combination constitute “significant advances”, namely:  
a) the plaintiffs’ request to each defendant to file their respective  
defences;  
36  
b) the defendants’ request for particulars; and  
c) settlement discussions with the defendant Canada.  
[88] Manitoba courts have had several occasions since the long delay rule  
came into effect to consider what constitutes a significance in an action, and the  
Alberta jurisprudence is also useful to consider. The Manitoba Court of Appeal  
addressed the issue most recently in WRE Development, as well as previously  
in Buhr v. Buhr, 2021 MBCA 63 (“Buhr”). The Court of Appeal has confirmed  
in both of these decisions that a functional approach must be used to determine  
whether there has been a significant advance in an action. Counsel made oral  
submissions on Buhr, and as noted, written submissions on WRE  
Development.  
[89] In WRE Development, the Court of Appeal provides the following  
framework for considering the functional approach at paragraphs 16 to 19:  
16 Whether an action has been significantly advanced involves an  
assessment and measurement of the effect of what happened in the  
action during the period of alleged delay, measured in light of the facts  
and the objectives of the rules of court. It is a question of mixed fact and  
law reviewed for palpable and overriding error absent extricable legal  
error (see Ro-Dar at para 11).  
17 In Buhr, this Court adopted the meaning of significant advance as  
described by the Alberta Court of Appeal in Ro-Dar; Morrison v Galvanic  
Applied Sciences Inc, 2019 ABCA 207; and Jacobs v McElhanney Land  
Surveys Ltd, 2019 ABCA 220 (see Buhr at paras 69-70). A significant  
advance exists if, in the applicable timeframe, something has been done  
that increased, by a measureable degree, the likelihood that either the  
parties or the court would have sufficient information to rationally assess  
the parties' positions and be in a better position to either settle or  
adjudicate the action (see Morrison at para 35; and Buhr at para 69). A  
significant advance means important or notable progress towards the  
resolution of an action (see Jacobs at para 85; and Buhr at para 70).  
18 A step by either party will be taken into account in deciding whether  
a thing has been done in three years to significantly advance the action  
(see Flock at para 17(7)).  
37  
19 Determining whether a step significantly advances the action requires  
a functional approach (see Buhr at para 71). The court must view the  
whole picture of what transpired in the three-year period framed by the  
real issues in dispute and viewed through a lens trained on a qualitative  
assessment. This necessarily involves assessing various factors, including  
the nature, value and quality, genuineness and timing of the step at issue  
and whether that step moved the lawsuit forward in a meaningful way in  
the context of the action (see Ro-Dar at para 21; Ursa Ventures Ltd v  
Edmonton (City), 2016 ABCA 135 at para 19; and Buhr at para 71). The  
focus is on the substance of the step taken and its effect on the litigation  
rather than its form (see Ursa at para 19; and Weaver v Cherniawsky, 2016  
ABCA 152 at para 18).  
The Plaintiffs’ Position  
[90] The plaintiffs say that their request that the defendants file statements of  
defence was a step which initiated a response. While the defendants did not file  
defences in response to the request, the request prompted each to serve a  
request for particulars.  
[91] The plaintiffs say further that the request for particulars from each  
defendant was extremely detailed. In particular, the request from Portage was  
nine pages in length and consisted of 40 questions. It required an analysis and  
explanation of historical information with respect to land title holdings for the  
land in dispute dating back to the 1800s which involved a tracking of historical  
legal title, as well as a history of the Dakota Plains people since the late 1800s.  
(Affidavit of Pauline Picton sworn the 30th day of March, 2021, Exhibit M).  
[92] The plaintiffs submitted that none of this could be perfunctorily answered.  
They say that the preparation of their reply required a wide review and analysis  
of historical records and archives dating back to the 1800s. As the individual  
Dakota Plains members who would have been involved in the purchase of trust  
38  
lands at the time, or who would have been among the forcibly located, are no  
longer living, providing the answers required extensive research and arguably as  
much work and effort as an examination for discovery or responses to  
undertakings.  
[93] Further, the plaintiffs say that their response to the request for particulars  
significantly narrowed a number of matters at issue in the litigation including the  
exact geographic location of the trust lands, the names of the neighbouring local  
farmers who held the trust lands for the plaintiffs, the particulars of the trust  
arrangement between the Dakota Plains members and farmers, a historical and  
retrospective tracing of the title to lands at issue in the provincial land titles  
system dating back over 100 years, identification of the specific applicable  
legislation, and the timeline of the history of the Dakota Plains people from the  
1800s to 1963.  
[94] Therefore, the plaintiffs say that the request for statements of defences  
initiated the exchange of particulars which significantly narrowed the issues and  
clarified the plaintiffs’ position vis-à-vis each defendant. Therefore, the plaintiffs  
say that while the request for the defences and the request for particulars each  
constitute a significant advance on their own, at a minimum, they constitute a  
significant advance when coupled together.  
[95] Further, the plaintiffs say that the request for the defences put to an end  
a standstill agreement that was in place between the parties, and the  
39  
termination of the standstill agreement in and of itself constituted a significant  
advance.  
[96] Finally, the plaintiffs’ further note that settlement discussions also took  
place following the request for the filing of the defences, and say those  
settlement discussions were also a significant advance in the action.  
The Defendant’s Position  
[97] Portage says there was no significant advance in the litigation prior to it  
bringing the within motion to dismiss for long delay. Portage says that the  
service of a request for particulars in and of itself does not constitute an advance  
of the actions, as it did nothing to advance the action in a material way. Portage  
argues that while a reply to a request for particulars might constitute a material  
advance, the request itself does not. In the present case, the service of the  
request for particulars did not advance the action at all, let alone in a material  
way.  
[98] Portage notes that it served its request for particulars within the thirty-day  
deadline given by the plaintiffs for it to file its defence. The plaintiffs then  
neglected to provide a reply until after the motion to dismiss for delay was  
brought, more than two years after the requests were made.  
[99] With respect to settlement discussions, Portage takes the position that  
they did not serve to significantly advance the action. First, Portage says that the  
evidence as it relates to the settlement discussions is bare and does not speak to  
the actual substance of the negotiations, what was or had been discussed,  
40  
whether any issues have been resolved, whether any information was  
exchanged, or when these discussions, if any, took place. Second, Portage was  
not involved in the alleged discussions, and until December 2020, was not even  
aware that they were occurring.  
Findings  
[100] With respect to the requirement by the plaintiffs that the defendants file  
their defences and the request for particulars that followed, I am prepared to  
consider the combined effect of those actions in applying the functional test.  
[101] The plaintiffs’ position that ending a standstill agreement in and of itself  
amounts to a significant advance in the litigation is not persuasive. If there was  
a standstill agreement, or express agreement to delay, as I have found in this  
case, there does not need to have been any significant advance during the  
period of the agreement. The ending of the standstill agreement in and of itself  
starts or restarts the three-year delay clock running.  
[102] Nonetheless, does requiring a defendant to file its defence after giving it  
an extension of time to file it, amount to a significant advance in the litigation?  
Following the functional approach, I find that the action itself is not sufficient.  
Nor is the action of requesting particulars. These events, either separately or  
taken together must cause important or notable progress towards the resolution  
of the action.  
[103] Prior to the within motion, no response was ever received by plaintiffs’  
counsel to the December 13, 2018 letter request for particulars. Service in  
41  
respect of the Request for Particulars was never admitted, nor were the  
particulars, or a written statement refusing to deliver same, ever provided by the  
plaintiffs until after the within motion to dismiss for delay was filed by Portage.  
[104] In D.S. v. Alberta, 2005 ABQB 677, (D.S.), the court specifically found  
that the mere filing of a demand for particulars was not a step that materially  
advanced the action. At paragraph 16 of that decision, the court wrote:  
16 . . . A Demand for Particulars is not, in itself, a thing that materially  
advances an action for the purposes of a Rule 244.1 application. Although  
contemplated by the Rules, it is not a step required by the Rules. By itself  
it does nothing. It is only when it has been answered that it can be said  
to have materially advanced the action. In fact, as was pointed out by the  
Plaintiffs, once it has been filed, it operates to freeze' the action. By filing  
such a Demand before filing a Statement of Defence, what the Defendant  
is effectively saying is that it cannot defend without further information  
from the Plaintiff. Thus, practically speaking, the action is stalled until the  
Reply to the Demand is filed. Logically, therefore, how can the filing or  
service of a Demand for Particulars be a thing' which materially advances  
the action when its effect is to stall the action until it has been answered?  
[105] In Stoney Tribal Council v. Petro-Canada, 2009 ABQB 430, several  
defendants filed demands for particulars after the plaintiff filed its statement of  
claim. More than five years later, and prior to the filing of the motion to dismiss  
for delay, the plaintiff filed its reply to the various demands for particulars.  
Nothing occurred in the intervening time. The court relied on the D.S. case and  
found that, although the reply may have constituted a material advance of the  
litigation, the filing of the respective demands for particulars were not. Because  
the reply to the demands for particulars were filed after the expiry of the drop-  
dead period (which was five years under Alberta’s former Rule 244.1), the last  
42  
material advance was the filing of the statement of claim by the plaintiff and, as  
a result, the court ultimately granted the motion and dismissed the action.  
[106] The plaintiffs say that the provision of particulars in this case is analogous  
to answering undertakings from discovery. The main issue in the Buhr decision  
was whether answers to some, but not all, of the plaintiff’s undertakings from  
discovery constituted a significant advance.  
[107] The plaintiffs ask for a further leap, not just that partial particulars could  
be a significant advance, but that working on the provision of particulars was a  
significant advance. While the work done to answer the particulars may well  
have been significant, the facts are that the particulars had not been provided  
more than two years after they had been requested.  
[108] I agree with the defendants that service of a request for particulars, in  
and of itself, does not constitute an advance of the action. It does nothing to  
advance the litigation in a material way. While providing a reply to the request  
with substantive particulars may serve to narrow or clarify certain issues, and,  
therefore, constitute a significant advance, that simply did not occur here until  
after the motion for delay was brought. I find that the work done by the plaintiffs  
to answer the particulars between service of the demand for particulars on  
December 13, 2018, and the service of the within motion on February 4, 2021,  
did not amount to a significant advance in the action. Therefore, even taken  
together, I find that the requirement to file a defence and the request for  
particulars did not amount to a significant advance in the action.  
43  
[109] I also am not satisfied that the settlement discussions taking place  
between the plaintiffs and the defendant Canada amounted to a significant  
advance in the action. The only evidence of these alleged negotiations are  
contained in an affidavit sworn by a legal assistant employed at the plaintiffs’ law  
firm which attaches two letters exchanged between counsel for the plaintiff and  
the defendant Canada in December 2019. Specifically, in a December 2, 2019,  
letter from counsel for the plaintiffs to counsel for Canada, counsel for the  
plaintiffs indicated that “our clients have been engaged in some discussions with  
representatives from Ottawa in an attempt to negotiate a resolution of this  
matter” and requested that counsel for Canada consent to counsel for the  
plaintiffs acting on behalf of the plaintiffs in said discussions.  
[110] Counsel for Canada responded on December 9, 2019, and advised that  
they were “generally aware of discussions” and that they had no objection to  
counsel for the plaintiffs’ involvement in potential settlement discussions on  
behalf of the plaintiffs. In the December 9, 2019, letter, counsel for Canada  
stated: “We expect it will be established early in any process to follow that such  
discussions are without prejudice to the positions the parties may take in the  
event the claim proceeds to litigation”.  
[111] The only other reference to these discussions between the plaintiffs and  
Canada is a letter from counsel for the plaintiffs to counsel for all parties of this  
litigation dated December 9, 2020, wherein counsel advises that they had been  
engaged in “some discussions with representatives from Ottawa in an attempt to  
44  
negotiate a resolution to this matter” and, on that basis, requested that the  
parties agree to hold the litigation in abeyance while those discussions were  
ongoing. Portage, or its counsel, was not involved in any alleged settlement  
discussions and, in fact, this December 9, 2020, letter was the first time that  
Portage was made aware of potential settlement discussions between the  
plaintiffs and Canada.  
[112] In 525812 Alberta Ltd. v. Purewal, 2004 ABQB 938 (“Purewal”)  
Justice Slattery (as he then was) considered whether settlement discussions  
could be considered a material advance of the action under the former Alberta  
Rule 244.1. He stated:  
16 It is difficult to envision how settlement discussions can materially  
advance an action. If the settlement discussions are successful, the action  
will be settled, and the matter is at an end. If the settlement discussions  
are unsuccessful, they accomplish nothing, and do not materially advance  
the action. Since the policy of the Court favours settlement, it would be  
unfortunate if merely entering into settlement discussions with the other  
party would in effect extend the time under the drop dead rule. This  
would discourage, rather than encourage settlement discussions. There is  
the possibility that the action might not be settled in whole, but that the  
settlement discussions might produce a narrowing of the issues, an  
agreement on certain facts, or an agreement on parts of the action (such  
as quantum or liability). In the latter case settlement negotiations might  
amount to things that materially advance the action, but there is nothing  
like that in this case.  
17 While most actions are resolved by settlement, and the Court  
encourages parties to settle their own differences, settlement discussions  
are not themselves an excuse for not advancing the action. If settlement  
discussions are unsuccessful, that is no excuse for simply doing nothing.  
In this case there was a period of approximately 20 months between the  
last settlement discussions and the motion to strike, a delay that cannot  
be justified under any reasoning.  
[113] Purewal has been considered and applied in numerous decisions since its  
release. In McKay v. Prowse, 2018 ABQB 975, for example, Ross J. considered  
45  
whether the approach to settlement negotiations as a significant advance of the  
action should be reconsidered in light of the amendments to Alberta’s drop-dead  
rule (i.e. from “material” to “significant” advance). After a thorough review of the  
jurisprudence on the issue, Ross J. ultimately held:  
I take from the case law, particularly the Court of Appeal decisions  
in Ro-Dar and Sutherland, that genuine but unsuccessful  
settlement negotiations alone do not constitute a significant  
advance in an action. There must be something additional, in the  
form of a narrowing of issues or production of relevant  
information.  
[114] I agree with the defendant that the bare assertion by the plaintiffs that  
they were having settlement discussions with the defendant Canada falls well  
short of meeting the functional test in the present case. For example, there was  
no evidence before me to suggest that the settlement discussions narrowed any  
issues or lead to the production of relevant documents. I find, therefore, that the  
alleged settlement discussions between the plaintiffs and the defendant Canada  
cannot be considered a significant advance of the litigation so as to avoid the  
application of Rule 24.02 and the dismissal of the action as against Portage.  
CONCLUSIONS  
[115] I find as follows:  
1) There was no significant advance in the action between the service  
of the amended statement of claim on November 30, 2017, and the  
filing of the within motion to dismiss for delay on February 1, 2021.  
2) There is no excluded time under Rule 24.02(2) in the present case  
because no statements of defence were served.  
46  
3) The parties expressly agreed to the delay between the service of  
the statement of claim on November 30, 2017, and December 16,  
2018, the date by which the defendants were required to be file  
their defences.  
4) The defendant’s motion to dismiss for delay was premature  
because there had not been three or more years without a  
significant advance in the action after the express agreement to  
delay ended on December 15, 2018.  
[116] Accordingly, the defendant’s motion to dismiss the action for long delay is  
dismissed.  
[117] If the parties cannot agree on costs they may arrange to speak to the  
issue.  
J. L. Goldenberg  
Master  


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