A functional approach to Alberta’s “drop-dead” rule
Overview
In Round Hill Consulting Ltd v Parkview Consulting Ltd, the Alberta Court of Appeal redefined how Rule 4.33 of the Alberta Rules of Court—the “drop-dead rule”—should be applied when there are related proceedings, such as a claim and a counterclaim. The Court moved away from the rigid “inextricable link” test and endorsed a functional, substance-based approach: if a procedural step meaningfully advances the dispute as a whole, it can preserve both actions from dismissal.
Key facts & issue
Round Hill and Parkview were consultants in a construction-management dispute. Round Hill sued Parkview in 2017 for unpaid fees; Parkview counterclaimed for alleged negligence and delay. Several years passed with limited progress. Parkview moved to dismiss Round Hill’s claim and its own counterclaim under Rule 4.33, alleging three years of inactivity.
The central issue: when two proceedings are factually intertwined, can steps in one count as progress in the other for the purpose of the three-year delay rule?
The Court’s decision
The Alberta Court of Appeal dismissed the motion to strike and clarified how Rule 4.33 should be interpreted.
The new “functional approach”
The Court rejected the earlier “inextricable link” test, which requires near-identity of issues between actions.
Instead, it held that the question is whether, in substance, a step in one proceeding significantly advances the resolution of the overall dispute—not whether the two claims are procedurally identical.
If progress in one action renders progress in the other inevitable or obvious (for example, through discovery, mediation, or document exchange relevant to both), that is sufficient.
Practical emphasis on purpose over form
The Court noted that Rule 4.33 exists to prevent stale litigation, not to punish parties engaged in genuine efforts to resolve interconnected disputes.
The Court cautioned that each case remains fact-specific: a superficial or administrative step will not save a claim; the advance must be “significant” and “toward resolution on the merits.”
Result: Both the main claim and counterclaim survived the dismissal motion.
Implications for construction disputes
1. Interconnected proceedings get breathing room
Construction litigation often involves multiple parallel claims—owners vs. contractors, contractors vs. subs, and so on. Under this new approach, progress in one related proceeding can count as progress in another if it advances the shared factual matrix.
2. Document production and discovery can “count twice”
Where documents or examinations cover issues common to both the claim and counterclaim, those steps may preserve limitation timelines under Rule 4.33.
3. The Court favours substance over technicality
The ruling reinforces the judiciary’s preference for resolving construction disputes on their merits, rather than dismissing them for procedural inactivity when parties are working in good faith across connected actions.
4. Clear records remain critical
Parties should maintain correspondence and docket notes showing how each procedural step (including in related actions) contributes to resolving the overarching dispute—evidence the court will rely on to determine whether progress was “significant.”
Key takeaway
This caremarks a subtle but important evolution in Alberta’s approach to litigation delay. For construction-industry litigants managing multiple related claims, the Court’s new functional test offers flexibility—but it also raises the evidentiary bar to prove genuine advancement.
This publication has been prepared for general information only and does not constitute legal advice or create a solicitor-client relationship. No reader should act or refrain from acting on the basis of any information included herein without seeking appropriate legal or other professional advice based on their particular circumstances. LEGALLY BUILT accepts no responsibility for any loss or damage that may arise from reliance on the information contained in this publication.