On February 24, 2022, a five judge panel of the BC Court of Appeal modernized the test for converting a petition into an action in Cepuran v. Calton.[1]

Prior to Cepuran, the leading authority on the threshold for converting a petition into an action was the Court of Appeal’s 2017 decision in Saputo[2] (where our own Hein Poulus, QC, represented the successful appellant).  Pursuant to the Saputo test the threshold for converting a petition into an action was low – a party only needed to show that there was a genuine triable issue.[3]

In Cepuran the Court of Appeal overruled the Saputo test and raised the hurdle.  The reason for doing so was to bring the Court’s approach to Petitions into conformity with the recent “considerable reform in civil litigation” to the effect of permitting and encouraging summary procedures.  In the words of the Court, having a “full trial with all the procedural bells and whistles available in an action” is no longer the only way to allow litigants their day in court.[4]

Against this backdrop, the Court of Appeal noted that the Supreme Court Civil Rules allow a judge in a Petition proceeding the flexibility to impose any number of procedures that apply in actions, such as discovery of witnesses, discovery of documents and cross-examinations on affidavits, and held that:

[158]   It should be kept in mind that the starting point for those matters that are properly brought by way of petition is that the Rules contemplate that a summary procedure will be appropriate: Conseil scolaire at paras. 29–30. This is different than the starting point for an action. There should be good reason for dispensing with a petition’s summary procedure in favour of an action. The mere fact that there is a triable issue is no longer a good reason.

[159]   The modern approach to civil procedure, as encouraged in Hryniak, is to allow parties and the trial courts to tailor the pre‑trial and trial procedures to a given case, in the interests of proportionality and access to justice, while preserving the court’s ability to fairly determine a case on the merits. In my view, R. 16‑1(18) and R. 22‑1(4) work to reflect this modern approach within a petition proceeding.

[160]   To summarize, I am of the view that a judge hearing a petition proceeding that raises triable issues is not required to refer the matter to trial. The judge has discretion to do so or to use hybrid procedures within the petition proceeding itself to assist in determining the issues, pursuant to R. 16‑1(18) and R. 22‑1(4)

[166]   At a minimum, when considering whether to order the use of hybrid procedures within the petition proceeding itself, or to refer the matter to trial, the court will need to be mindful of the object of the Rules set out in R. 1‑3: to secure the just, speedy and inexpensive determination of every proceeding on its merits, and so far as can be achieved, in ways that are proportionate to the amount involved, the importance of the issues, and the complexity of the proceeding.

[emphases added]

Cepuran represents a welcome change for commercial litigants seeking the efficient resolution of discrete commercial issues available by Petition, such as shareholder oppression proceedings.   Previously, those litigants faced the low threshold for referral to the trial list, leading to longer timeframes for resolution and higher cost.

For more information, please contact Erin Kotz, Hein Poulus, QC, or Joe Ensom.

[1] 2022 BCCA 76 [Cepuran].

[2] British Columbia (Milk Marketing Board) v. Saputo Products Canada G.P. / Saputo Produits Laitiers Canada S.E.N.C., 2017 BCCA 247 [Saputo].

[3] Saputo, paras. 43-44.

[4] Cepuran, para. 147.

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