Case: New Star Energy Ltd v. Lam, 2025 ABCA 342 (CanLII)
Keywords: nullity; consent judgment
Synopsis:
A consent judgment signed by the parties is filed in the Court of King’s Bench through an “Email Filing Request”. Appended to the consent judgment: an affidavit verifying corporate signing authority for the Appellant’s Interim Chief Executive Officer: Mr. Zhao.
Importantly,
- Mr. Zhao is not a lawyer; and
- the filing request form indicates that no action number existed (i.e., that the signed consent judgment was an “originating document”). (See para. 1).
The consent judgment is later signed by an applications judge and returned to counsel. (See para. 4). A few years later, the Appellant’s bank receives a garnishee summons pursuant to the consent judgment; the Appellant files an application seeking an interim and permanent stay of the consent judgment. (See para. 5).
According to the Appellant, the consent judgment has “no foundation in law” and was a “nullity” because:
- no action was properly commenced (i.e., there was no underlying matter which resulted in the consent judgment); and
- s. 106(1)(d) of the Legal Profession Act, RSA 2000, c L-8, prohibits a person who is not an active member of the Law Society of Alberta from settling, or negotiating in any way for the settlement of, any claim for loss or damage founded in tort. (See para. 5).
The Court of King’s Bench per Malik J. dismisses the Appellant’s application to declare the consent judgment a “nullity”. (See para. 1). The Court of Appeal per Kirker J.A. (Pentelechuk and Woolley JJ.A. concurring) agrees. (See para. 9).
Importance:
To what extent can procedural errors – such as the two raised by the Appellants herein – “nullify” a consent judgment?
For the Court of Appeal, the decision in Chandos Construction Ltd v. Deloitte Restructuring Inc., 2024 ABCA 403 represents a break from previous authorities (i.e., “the law and rules of court have evolved since then”) and affirms the rejection of the idea that “procedural errors create ‘nullities’” articulated in Bridgeland Riverside Community Association v. Calgary (City),1982 ABCA 138. (See para. 7; Chandos at para. 21).
In contemporary practice, the Court of Appeal says “[i]rregularities in the commencement of proceedings may be cured where no irremediable prejudice arises from the defect”. (See para. 7; Alberta Rules of Court, Alta Reg 124/2010, rules 1.5(4) and 3.2(6)).
In the circumstances of this case, the Court of Appeal determined there was no evidence of prejudice. Although acknowledging that Mr. Zhao’s signing of the consent judgment may constitute “some evidence of a contravention of s. 106(1) of the Legal Profession Act”, the Court declined to resolve this question determinatively: “we are not deciding that. It is the subject of the separate action”. (See para. 8).
At a deeper level, however, the Court of Appeal spoke to the nature of superior court judgments/orders. Citing Mazepa v. Embree, 2014 ABCA 438 at para. 10 and Tempo Alberta Electrical Contractors Co Ltd v. Man-Shield (Alta) Construction Inc., 2025 ABCA 282 at para. 26, the Court observed:
- “[t]here is an overriding principle that the orders of a superior court of record are never nullities”;
- this is so, even if the judgment/order “should not have been granted”, is “based on procedural irregularities”, or “undermined by reviewable error; and, finally,
- that a judgment/order is valid until set aside. (See para. 8).
Bottom line: the Court of Appeal is signalling that the principle of nullity for procedural errors has limited scope in contemporary practice. Superior court judgments/orders are not “nullities”, even where there is an error or reviewable mistake. Addressing such errors takes another court with jurisdiction to set the judgment/order aside.
Counsel for the Appellant: Lillian Pan, K.C. and Brenden Roberts (Dentons, Calgary)
Counsel for the Respondents: Kenneth Reh (Kenneth P. Reh Law Office, Calgary)