HEARSAY ON SUMMARY JUDGMENT

Published: July 24, 2026 | By: Roger Baker 6 min read

A summary dismissal can end a lawsuit before trial, but it does not always succeed. Where a key witness gives shifting accounts of events, or where important evidence arrives as hearsay, those features can be the reason a case must go to trial rather than a reason to dismiss it. The Court of King's Bench makes that point in Liberty Land Corporation v Kinnear, 2026 ABKB 248 ("Liberty Land"), setting aside the summary dismissal of a claim and sending it to trial.

Baker Law Firm acts for Liberty Land Corporation, the successful appellant. This article reviews the decision and the legal reasoning that carries the appeal.

A Disputed Land Deal and the Duties of an Agent

The dispute arises from land transactions near Olds, Alberta, in 2007. Liberty Land Corporation, a property developer, retained a real estate brokerage and its agents to help acquire two quarter-sections of farmland from the Statham family. Liberty alleges that an agent disclosed its confidential maximum price to the sellers. Liberty paid $40,000 per acre, and alleges the disclosure caused it to overpay by more than $5,000 per acre.

The claim is broader than confidentiality alone. Liberty advances breaches of contract, fiduciary duty, loyalty, and confidentiality (Liberty Land at para 2). A real estate agent acts as its client's fiduciary: an agent retained on a transaction owes its principal a duty to act in the client's best interests, which includes full and fair disclosure (Trynchy v Gabriel, 2012 ABQB 682 at paras 76–80). Liberty Land does not analyze those duties, because the appeal turns on procedure and evidence. They frame what is at stake, though, because the allegation is that an agent advanced the other side's interests at its own client's expense.

The Summary Dismissal and the Appeal

An Applications Judge grants the defendants' application to summarily dismiss Liberty's claim, and the heart of that decision is evidentiary. Much of the evidence Liberty relies on to prove what was said in 2007 is hearsay, and the Applications Judge concludes that Liberty cannot use it to raise a triable issue. The Applications Judge also takes the view that the case law has moved toward excluding hearsay on summary judgment applications.

Liberty appeals to a justice of the Court of King's Bench. On the appeal, Liberty advances additional evidence, including sworn examinations of Lyle Statham and others, and argues that the admissibility of its hearsay and the credibility of the witnesses are both genuine issues that require a trial.

The Law: Hearsay and the Principled Approach

Hearsay is an out-of-court statement offered for the truth of its contents. The law presumptively excludes it because a trier of fact cannot properly weigh a statement made by a person who has not been seen, heard, or cross-examined (Liberty Land at para 188). The principled approach admits hearsay despite that concern when the evidence is both necessary and sufficiently reliable.

This admissibility requirement runs both ways. A party resisting summary dismissal, no less than the party seeking it, must show that the hearsay it relies on would be admissible at trial (Liberty Land at para 162). Justice Reed corrects the premise underlying the dismissal below. To the suggestion that the law has evolved toward excluding hearsay on summary judgment applications, he responds directly: "I do not think that is an accurate statement of the law" (Liberty Land at para 157).

Reliability at this stage means "threshold" reliability, established in one of two ways. Substantive reliability asks whether the circumstances in which a statement was made render it inherently trustworthy. Procedural reliability asks instead whether there are adequate substitutes for testing the statement (Liberty Land at para 192, citing R v Bradshaw). That distinction decides the admissibility question here.

Why the Hearsay Is Admissible: A Witness Who Can Be Tested

The strongest substitute for testing a statement is the ability to cross-examine the person who made it. Where a witness has made a prior statement that they now dispute, and that witness can be questioned about it, the trier of fact can weigh the prior statement directly. For prior inconsistent statements, Justice Reed explains, "the availability of the declarant for cross-examination on the prior statements is key in assessing threshold procedural reliability," and the inquiry "is not so focussed on the question whether there is reason to believe the statement is true, as it is on the question whether the trier of fact will be able to rationally evaluate the evidence" (Liberty Land at para 194).

That principle decides the point. Lyle Statham is available to be examined, both on the appeal and at any trial, so his prior statements can be tested in the ordinary way. The Court holds that this availability satisfies threshold procedural reliability and admits his September 2010 email and an earlier draft statement to show a triable issue (Liberty Land at paras 213, 215, and 219). The responding parties had not fully engaged with that availability, and it supplies the procedural safeguard the law looks for.

Not every document clears the bar. The Court does not admit a draft statement attributed to a witness who has since died and never adopted it while alive, and it gives self-serving hearsay from Liberty's own principals little weight. But the key documents Liberty needs to point to a triable issue are available to it.

A Genuine Issue Requires a Trial

The hearsay ruling matters, but the Court's central conclusion rests on a separate principle of equal weight. Where the evidence discloses a genuine conflict on a relevant point, cross-examination has not resolved that conflict, and the competing evidence is more than a bald or self-serving assertion, the dispute goes to trial rather than being decided summarily (Liberty Land at para 228, citing Goodswimmer). A summary application cannot fairly resolve a contest of that kind.

This case meets that test. Liberty's claim rests heavily on Lyle Statham, whose account has shifted over time. As Justice Reed puts it, Lyle "changed his story (at least) three, if not four times in the last 16 years" (Liberty Land at para 229). Whether his earlier account or his later one is true is a credibility question, and Justice Reed is careful about the limits of his role. He makes no finding that any witness is truthful or untruthful. He holds only that the conflict must be resolved at trial, where the witnesses can be seen and tested, and that the same conclusion follows whether the prior statements are used for their truth or only to test Lyle's credibility (Liberty Land at para 230). On that basis the Court is "not satisfied that there is no genuine issue for trial," a question "bound up in the changing evidence of Lyle, which requires credibility assessments not suited to summary disposition on a paper record" (Liberty Land at para 237).

The Result

Justice Reed allows the appeal and sets the summary dismissal aside, so the claim proceeds to trial. As he puts it, "Even in the face of Kinnear's evidence for the Real Estate Defendants, I find that Liberty has shown a genuine issue for trial" (Liberty Land at para 239). The Court awards Liberty its costs as the substantially successful party (Liberty Land at para 241).

None of this decides the merits. The allegations remain to be proven, and the defendants are entitled to defend them at trial. What the decision settles is that Liberty is entitled to have them decided there.

Why This Matters for Litigants

The practical lessons for litigants are concrete. A party resisting a summary dismissal cannot point to hearsay and assume it will be enough. It must be ready to show the evidence would be admissible at trial. A party seeking dismissal cannot assume the other side's hearsay will be excluded, particularly where the person behind the statement can be cross-examined. And where a case turns on a genuine credibility dispute, a summary application is rarely where that dispute gets resolved.

The rules of evidence do not wait for trial. As this decision shows, a court engages with questions of admissibility at the summary judgment stage, and a party that treats those rules as a trial-only concern takes a real risk. Marshalling the evidence, and being ready to defend its admissibility, can decide whether a claim survives long before any trial begins.

Baker Law Firm acts for the successful appellant in Liberty Land. Our litigation practice regularly handles summary judgment and summary dismissal applications, and the evidentiary questions they turn on.