An Ontario Superior Court judge has denied a defendant’s attempt to have an eight-year-old construction dispute thrown out for delay, finding that the plaintiff provided reasonable explanations for the lengthy timeline, including the impact of the COVID-19 pandemic and significant difficulties with its legal representation1. The ruling allows the case, which began with a construction lien filed in 2017, to proceed to trial on its merits.
The legal battle commenced on January 13, 2017, when Cy Rheault Construction registered a claim for a construction lien amounting to $338,326.98 against a property owned by Danark Enterprises Limited. To perfect its lien, a necessary legal step, the construction company initiated a court action on February 27, 2017. The lawsuit initially named the Bank of Nova Scotia as a second defendant, but the plaintiff discontinued the action against the bank shortly after, on March 7, 2017.
Danark Enterprises responded by delivering a statement of defence and a counterclaim on March 27, 2017, formally disputing the plaintiff’s claims and asserting its own. The early stages of the litigation were marked by procedural motions. The plaintiff brought a motion, originally scheduled for May 19, 2017, seeking to have Danark’s lawyer, Peter Doucet, removed as counsel of record due to an alleged conflict of interest. While this motion was ultimately abandoned by the plaintiff, its presence on the court file impacted other proceedings.
In the spring of 2018, while the motion to remove Mr. Doucet was still outstanding, Danark sought permission from the court for Mr. Doucet to cross-examine Roger Rheault, the principal of the plaintiff company. On May 22, 2018, Justice Gauthier denied this request, effectively pausing that aspect of the litigation until the conflict of interest issue was resolved. Following these early motions, the plaintiff delivered its reply and defence to Danark’s counterclaim on August 28, 2018.
The matter then proceeded through the standard litigation steps. In December 2018, both parties exchanged their affidavits of documents, a formal process where each side discloses the relevant evidence in its possession. Examinations for discovery, where lawyers for each party question the opposing party under oath, took place in August 2019. Following these examinations, Danark provided its answers to undertakings, which are promises to provide further information, in December 2019. The plaintiff followed with its undertaking answers in June 2020. It was after this point that the progression of the case slowed considerably.
More than four years later, on November 1, 2024, Danark filed the motion at the heart of the recent decision. It asked the court for an order dismissing the entire action for delay, arguing that the plaintiff had failed to take the necessary steps to move its claim forward in a timely manner. Danark asserted that this delay had caused it both inherent and actual prejudice. In the alternative, Danark asked the court to impose a strict timetable on the remainder of the case. In response to the motion, Cy Rheault Construction’s principal was cross-examined on his affidavit on January 27, 2025. The motion was ultimately heard by videoconference on July 11, 2025.
In his decision released on September 8, 2025, Regional Senior Justice P.J. Boucher analyzed the defendant’s motion under Rule 24.01 of the Rules of Civil Procedure, which allows a defendant to move for dismissal if a plaintiff has not set an action down for trial within six months after the close of pleadings. Justice Boucher noted that the legal threshold for such a dismissal is high, requiring either intentional and disrespectful delay or an inexcusable delay that creates a substantial risk that a fair trial is no longer possible.
Justice Boucher first considered whether the delay was “intentional and contumelious,” a standard that implies disrespect for the court and is often associated with breaches of court orders. He quickly concluded that this high threshold was not met and noted the defendant did not pursue this line of argument.
The central issue became whether the delay was inexcusable and whether it created a risk to trial fairness. The court found that from the start of the action in 2017 until June 2020, the case proceeded in the usual course, with delays being the responsibility of both parties. The focus of the motion was on the period after June 2020.
Cy Rheault Construction offered several explanations for the subsequent delay. The company stated its business was severely impacted by the COVID-19 pandemic, which brought its projects to a halt in 2020. This financial strain was compounded in 2021 when it lost one of its major clients, placing the company’s viability in jeopardy.
Beyond business challenges, the plaintiff encountered significant issues with its legal representation. In an affidavit, the plaintiff stated that it reached out to its original lawyers in 2022 only to learn they had left their firm. However, email evidence showed that as early as December 2020, the plaintiff was already trying to retain new counsel, a lawyer named Contant, and had asked him to obtain the case file and move the matter toward a court date or mediation.
The process of changing lawyers proved to be complicated and lengthy. In 2021, the plaintiff was sued by its previous law firm for non-payment of legal fees. Justice Boucher inferred from the evidence that this dispute likely resulted in a solicitor’s lien being placed on the case file, preventing its transfer. It was not until November 28, 2023, nearly three years after first contacting him, that the new counsel, Contant, finally received the file from the previous firm.
Even after securing the file, the plaintiff’s efforts to advance the case were frustrated. In the fall of 2023 and winter of 2024, the plaintiff followed up with Contant to move the matter forward, but was unsuccessful. When Danark served its motion to dismiss, Contant advised the plaintiff that he was unable to defend the motion due to personal reasons. This prompted the plaintiff to hire its current counsel in October 2024, who then responded to the motion.
Justice Boucher concluded that, in all the circumstances, the delay was not inexcusable. He accepted the plaintiff’s evidence that its business was severely impacted by the pandemic and the subsequent loss of a major client. He noted the significant legal hurdles the plaintiff faced, including the litigation with its former counsel and the long delay in transferring the case file.
Having found the delay to be excusable, Justice Boucher also considered whether it had created a substantial risk that a fair trial was no longer possible. This analysis involves considering prejudice to the defendant. The judge found that the plaintiff had successfully rebutted the presumption of inherent prejudice that comes with a long delay. He noted that discoveries were completed early in the proceedings, most undertakings had been answered, and the trial record had recently been passed, meaning the action was now ready for trial.
Furthermore, Justice Boucher found that Danark had “failed to lead convincing evidence of actual prejudice, or any, for that matter.” The absence of specific evidence showing how the delay had harmed Danark’s ability to defend itself weighed heavily in the decision. The judge also dismissed the defendant’s argument that the court should use its inherent jurisdiction to dismiss the action as an abuse of process, stating that the plaintiff had provided a reasonable excuse for the delay, which therefore did not undermine public confidence in the administration of justice. The plaintiff, he wrote, was “entitled to have this dispute decided on its merits.”
With the motion dismissed, Justice Boucher ordered the parties to contact the trial coordinator to schedule a judicial pre-trial conference. He noted that during oral arguments, counsel had advised the amount in dispute had been greatly reduced and suggested that at the pre-trial, the parties could consider using affidavits for witness testimony to shorten the eventual trial. The judge declined to set a timetable, finding it unnecessary now that the matter was set to proceed. The issue of legal costs for the motion was left for the parties to either agree upon or settle through written submissions to the court.
