In an action arising from investments in an oil and gas producing zone (the Sparky K Formation) in east central Alberta since 2004, the Alberta Court of Appeal affirmed a chambers judge’s refusal to strike the claim for delay.
In 2009, the respondent in EMM Energy Inc v Canadian Natural Resources Limited, 2026 ABCA 181, brought its action asserting damage via the appellant’s injection of water into the formation without authorization from the relevant regulator, now known as the Alberta Energy Regulator.
Denying liability, the appellant alleged that it had authorization to inject water into the Sparky K Formation since 1993, that its water injection did not cause any damage, and that the formation was mostly depleted by 2004.
On Feb. 17, 2022, the respondent applied for permission to amend its pleadings and to compel the appellant to participate in alternate dispute resolution. On Mar. 31, 2022, the appellant cross-applied to strike the action for long delay under r. 4.31 of the Alberta Rules of Court, Alta Reg 124/2010.
On Jan. 3, 2023, the applications judge struck the claim upon agreeing with the parties that the delay was inordinate.
On Oct. 28, 2025, the chambers judge allowed the respondent’s appeal and proposed amendment. He declined to strike the respondent’s claim for delay under r. 4.31.
While confirming that the delay was inordinate, the chambers judge found the delay excusable due to both parties’ significant contributions to the delay in the action.
On appeal, the appellant argued that the chambers judge erred by reversing the onus to excuse inordinate delay, by failing to consider the respondent’s responsibility for delay, and by misapprehending evidence of actual prejudice to the appellant.
The appellant sought to present new evidence on appeal to establish the prejudice it experienced due to the delay. According to the appellant, under the proposed evidence:
- One of its planned expert witnesses, a former employee of the Energy Resources Conservation Board, passed away in February 2025, before the chambers judge’s application hearing
- The appellant only learned of the death in November 2025, after the chambers judge’s issuance of his decision
No errors found
The Court of Appeal of Alberta dismissed the appellant’s appeal and application to adduce new evidence.
First, the appeal court found no error in the chambers judge’s interpretation of r. 4.31 of the Rules of Court. The appeal court also saw no palpable and overriding error in his finding that the delay was excusable.
The appeal court noted that the chambers judge summarized the law on defence delay under r. 4.31 and conducted a detailed review of the delays the appellant caused or the delays to which it contributed.
The appeal court did not take issue with the chambers judge’s careful consideration of the appellant’s conduct in connection with the delay in the action.
Second, the appeal court saw no reviewable error in the chambers judge’s determination that the appellant failed to meet its onus to establish that it experienced significant prejudice.
The appeal court deferred to the chambers judge’s finding that the appellant failed to establish significant prejudice even though two of the appellant’s intended witnesses were no longer employees and the three other anticipated witnesses no longer worked on the relevant assets.
Third, the appeal court ruled that the appellant’s proposed evidence, an affidavit from a legal assistant, failed to meet the test in Palmer v. The Queen, 1979 CanLII 8 (SCC), [1980] 1 SCR 759.
Without additional information about the nature of the deceased’s evidence and other possible available sources of similar evidence, the appeal court found it impossible to determine:
- whether the deceased’s evidence was potentially relevant to a decisive issue or capable of impacting the outcome
- whether the death significantly prejudiced the appellant