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The Advisory: Volume 10, Issue 2, April 2012


Click here to view the PDF version of The Advisory

Ethically Speaking:

Procedural and Ethical Obligations Under the New ‘Drop Dead’ Rule

By Nancy Carruthers, Practice Advisor, Law Society of Alberta

Rule 4.33 comes into effect November 1, 2012 which is the new version of what we have affectionately dubbed the ‘drop dead’ rule.

It requires that a ‘thing’ be done to ‘significantly advance’ an action within the previous two years. If nothing has been done, a defendant can apply to strike a plaintiff’s claim.

Exceptions to the rule arise where:

  • The parties have expressly agreed to the delay;
  • There is an order staying or adjourning the action or extending the time for doing the next thing in the action, or the delay is provided for in a litigation plan;
  • The applicant/defendant did not respond to a written proposal by the respondent that the next thing in the action not occur until more than two years after the last thing done that significantly advanced the action; or
  • An application has been filed or proceedings have been taken since the delay and the applicant has participated in them for a purpose and to the extent that, in the opinion of the Court, warrants the action continuing.

In the meantime, Rule 15.4 applies. It provides for the same exceptions but also contains the transitional rule. The plaintiff must have done something to advance the action within the last five years or, in any event, within two years from November 1, 2010. The old fiveyear ‘drop dead’ date will apply or a two-year deadline will apply, expiring November 1, 2012, whichever comes first.

This means, for example, that:

  • If the last ‘thing’ took place on June 1, 2007, five years will elapse on June 1, 2012. The defendant could apply to strike the claim any time commencing in June 2012, as the fiveyear deadline is the earlier of the two.
  • If the last ‘thing’ took place on June 1, 2008, five years will elapse on June 1, 2013, but the ‘drop dead’ date is November 1, 2012, two years following the implementation of the new Rules. The ‘drop dead’ date would be the same if the last ‘thing’ was completed on the file in June of 2009 or even June of 2010.
  • If the last ‘thing’ was completed on or after November 1, 2010, the ‘drop dead’ date falls on the second anniversary of that date.

Some lawyers have expressed concern about this new rule. It is of particular concern to those who act for plaintiffs in personal injury matters, where injuries may be slow to resolve and experts are potentially hard to access. Although you may attempt to get the defendant to agree to extend deadlines or serve them with a written proposal, in some cases, these measures are not yielding the desired results due to a perceived lack of cooperation or reasonableness on the part of defence counsel. The new rule has reportedly affected the ability or willingness of some lawyers to accept new cases, out of concern that the new ‘drop dead’ rule may make it more onerous to effectively handle the cases they already have. Some lawyers even suggest that the new rule will cause litigation to move more slowly. There are few steps a plaintiff can initiate on his or her own, so their timing may be delayed to reset the clock and extend the deadline.

These are all legitimate observations by lawyers who are now obligated to deal with the practicalities of a new rule. Certainly defendants will see the new ‘drop dead’ rule as a tool to speed the resolution of claims, or to otherwise have stagnant claims dismissed or courtmanaged at an earlier stage.

A troubling aspect of the feedback received is the suggestion that defence lawyers are not acting reasonably and are not assisting matters to move forward. Some lawyers perceive the new rule to be very favourable to defendants and suggest it allows them to engage in delay without consequences.

There are strategies plaintiffs can use to ensure compliance with the ‘drop dead’ rule:

  • Obtain consent or apply for an order to extend the time for doing the next thing;
  • Deal with the potential for delay in a litigation plan or proposal pursuant to Rule 4.4 or 4.5 and, failing agreement, apply to the court for direction and assistance; or
  • To the extent possible, continue to employ steps to move the action forward, even where damages may not yet be fully resolved.

Under the new Rules of Court, the responsibility for moving an action forward lies both with the plaintiff and defendant. Rule 4.1 provides that it is the responsibility of all parties to manage and resolve their dispute in a timely and cost-effective way. Rule 4.2 provides that parties in a ‘standard case’ must respond in a ‘substantive way and within a reasonable time to any proposal for the conduct of an action’. In complex matters, the parties must be timely in meeting or adjusting dates in a litigation plan.

If a plaintiff has concerns that the defendant is going to wait until the two-year deadline approaches to respond to a proposal, thereby depriving the plaintiff of the application of one of the exceptions to the ‘drop dead’ rule, then a deadline should be provided for a reasonable date by which the defendant is to reply. Failing a response, the defendant should be advised of the plaintiff’s intention to apply to court for further direction or guidance.

Both sides to a dispute not only have obligations under the new Rules of Court but also under the Code of Conduct. All lawyers have obligations of courtesy, civility and good faith in dealings with one another, in general and in our roles as advocates. Courtesy and civility necessitate timely and reasonable responses to communications from other lawyers. We are to agree to reasonable requests for the waiver of procedural formalities that do not prejudice the rights of clients. Lawyers also must not take steps that are without merit or which unreasonably delay court processes.

The Rules of Court Committee and the Law Society of Alberta Civil Practice Advisory Committee are reviewing recent feedback from the profession, but we expect that Rule 4.33 will be implemented as planned in its current form.

The bottom line is lawyers need to review each litigation file in the office to identify the date of the last ‘thing’ done to move your action forward. Enter the relevant date in your diary system. Familiarize yourself with the Rules and applicable case law, if you haven’t already. Take available courses on the new Rules and on the development of litigation plans – LESA and ACTLA are offering courses this spring. Don’t delay – ALIA (Alberta Lawyers Insurance Association) will thank you!

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