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Tricks of the Trade Conference
Tort Update 2015
Prepared by Stephen Moore and Amy Gates Blaney McMurtry LLP
Tricks of the Trade Conference
Tort Law Update 2014
Table of Contents Introduction ....................................................................................................................................... 4
The Cases ............................................................................................................................................ 5
A.I. Enterprises Ltd. v. Bram Enterprises Ltd. - Tort of unlawful means ........................... 5
The Facts ................................................................................................................................... 5
Background to the “Unlawful Means” Tort ......................................................................... 5
The Supreme Court of Canada Decision .............................................................................. 6
Fowlow v. Southlake Regional Health Centre - Causation in negligence ............................. 7
The Facts ................................................................................................................................... 7
The Court of Appeal Decision ............................................................................................... 8
Bondy v. London - Municipalities have a statutory duty to maintain lower portions of driveways on boulevards .............................................................................................................. 8
The Facts ................................................................................................................................... 9
The Court of Appeal Decision ............................................................................................... 9
Fordham v. Dutton-Dunwich (Municipality)-Municipalities do not owe a duty to drivers who do not drive with reasonable care ...................................................................................... 9
Miller Group Inc. v. James - Pierringer or proportionate share settlement agreement ....10
The Facts .................................................................................................................................10
The Court of Appeal Decision .............................................................................................11
Mandeville v. The Manufacturers Life Insurance Company- Anns test and Pure economic loss ..............................................................................................................................12
The Facts .................................................................................................................................12
The Court of Appeal Decision .............................................................................................13
TMS Lighting Ltd. v. KJS Transport Inc. - Test for Establishing Private Nuisance ........14
- 3 -
The Facts .................................................................................................................................14
The Court of Appeal Decision .............................................................................................15
Raposo v. Dasilva - No reasonable cause of action where claim for intentional infliction of mental suffering but not acts alleged, only omissions ......................................................16
The Facts .................................................................................................................................16
Lower Court Decision ...........................................................................................................16
The Court of Appeal Decision .............................................................................................17
Hansen v. Strone Corporation - Discoverability and Limitation Periods ..........................17
The Facts .................................................................................................................................18
The Summary Judgment Motion ..........................................................................................18
The Court of Appeal Decision .............................................................................................18
Upchurch v. Oshawa (City) - Tort of Negligent Investigation and the Standard of Care Applicable to City Officials .......................................................................................................18
The Facts .................................................................................................................................19
The Court of Appeal Decision .............................................................................................19
Stilwell v. World Kitchen Inc. - Product Liability and Duty to Warn .................................20
The Facts .................................................................................................................................20
The Court of Appeal Decision .............................................................................................20
Ernst v. EnCana Corp. – The Energy Resources Conservation Board does not owe a private law duty of care to landowners ....................................................................................21
The Facts .................................................................................................................................21
The Alberta Court of Appeal Decision ...............................................................................22
George v. Newfoundland and Labrador - No Liability of a Province for MVAs involving Moose ...........................................................................................................................................23
The Facts .................................................................................................................................23
The Newfoundland and Labrador Supreme Court Decision ..........................................23
Tricks of the Trade Conference Tort Law Update 2014
Introduction1
There have been several significant cases this past year which every civil litigator should be
aware of. The Supreme Court of Canada has clarified the tort of “unlawful means” in A.I.
Enterprises Ltd. v. Bram Enterprises Ltd. The Ontario Court of Appeal has released its first
decision commenting on causation since the release of Clements in Fowlow v. Southlake
Regional Health Centre in 2012 by the Supreme Court of Canada. It has confirmed that
municipalities have a statutory duty to maintain the lower portions of driveways on
boulevards to the standard required for vehicular traffic and not that required for
pedestrian walkways in Bondy v. London (City). On the other hand, the Ontario Court of
Appeal held in Fordham v The Corporation of the Municipality of Dutton-Dunwich that
municipalities do not have a duty to make roads safe for negligent drivers. In Miller Group
Inc. v. James, the Court considered the interpretation and application of a Pierringer
agreement, and in Mandeville v. The Manufacturers Life Insurance Company the Court refused to
recognize a novel of duty of care owed to stakeholders by a company in connection with a
legitimate transaction that received regulatory approval. In TMS Lighting Ltd. v. KJS
Transport Inc., the Court revisited and confirmed the test for establishing private nuisance.
The Court held that the tort of intentional infliction of mental suffering probably cannot
be grounded on an alleged omission rather than an intentional act in Raposo v. Dasilva.
Hansen v. Strone Corporation is an illustration of how the discoverability rules affect when
limitation periods begin to toll. In Upchurch v. Oshawa (City), the Court held that the
standard of care applicable to city representatives requires that they exercise their duties
reasonably, not that they interpret relevant law correctly. In the product liability case of
Stilwell v. World Kitchen Inc., the Court reiterates that for an award of aggravated damages to
be upheld, evidence of reprehensible misconduct is required.
1 I would like to thank Amy Gates, an associate at our firm, for the research she did. She also wrote significant portions of the paper. Any mistakes however are my responsibility.
- 5 -
Elsewhere in Canada, the Alberta Court of Appeal in Ernst v. EnCana Corp., decided that
the Energy Resources Conservation Board does not owe a private duty of care to a
landowner. And finally on a more entertaining note, the Newfoundland and Labrador
decision in George v. Newfoundland and Labrador dismissed a class action against the province
where the plaintiffs could not establish a duty on the part of the Province to prevent
moose from venturing onto provincial highways.
The Cases
A.I. Enterprises Ltd. v. Bram Enterprises Ltd.2 - Tort of unlawful means
In this unanimous Supreme Court decision, the Court revisited and clarified the economic
tort of unlawful means, also referred to in the past as the tort of unlawful interference with
economic relations.
The Facts
A mother and her four sons owned an apartment building through corporations. Most of
the family wanted to sell the building, but one of the sons did not. The dissenting son took
a series of actions to thwart the sale. The result was that the ultimate sale price was nearly
$400,000 less than it otherwise might have been. When the majority sued to recover this
loss, the issue was whether the son and his company were liable for the tort of causing loss
by unlawful means.3
Background to the “Unlawful Means” Tort
In a decision which reviewed the law in this area extensively the Court called the state of
the common law in relation to the unlawful means tort “unfortunate” in that there has
been little consistency and much confusion in its application. There has not even been
consensus on what to name the tort; the unlawful means tort has also been referred to as
the “tort of unlawful interference with economic relations”, “interference with a trade or
business by unlawful means”, “intentional interference with economic relations”, or 2 2014 SCC 12
3 At para. 1. At paragraph 2 the court discusses the various names the tort has been called and decides to refer to it as “causing loss by unlawful means” or the “unlawful means” tort.
- 6 -
“causing loss by unlawful means”. The Supreme Court of Canada noted that while this tort
is far from new, its scope was unsettled and needed clarification. The Court acknowledged
that there historically was a lot of uncertainty surrounding it, and in A.I. Enterprises Ltd. v.
Bram Enterprises Ltd. the court undertook to clarify its scope. While the elements of the tort
have been described in a number of ways, its core captures the intentional infliction of
economic injury on a plaintiff by the defendant’s use of unlawful means against a third
party.
The Supreme Court of Canada Decision
The unlawful means tort is now available only in situations where there are three parties,
the defendant commits an intentional unlawful act against a third party and that act causes
economic harm to the plaintiff. The Court held that the tort should be kept within these
narrow bounds.
In order for conduct to be considered “unlawful” for the purposes of this tort, the conduct
complained of must either be (a) civilly actionable by the third party, or (b) would have
been civilly actionable if it had caused harm to the third party. It is not sufficient for the
conduct to have constituted a breach of a statute or regulation. The Court refused to
“tortify” every breach of a statute or regulation.
The son who did not want to sell the building argued that the tort only applies where no
other cause of action is available. The Court rejected his argument, holding that this
suggested requirement was unnecessary to keep the tort within its proper bounds.
The Court rejected the availability of principled exceptions. The Court was concerned that
recognizing exceptions would allow for too much judicial discretion, the result of which
would be to undermine the certainty of the tort and broaden its scope.
The Court also commented on what conduct would be considered intentional for the
purposes of this tort. It concluded that conduct that was intended to cause economic harm
to the claimant by the defendant as an end in itself or conduct which was intended to cause
economic harm to the claimant because it is a necessary means of achieving an end that
serves some ulterior motive would qualify.
- 7 -
Ultimately, the Supreme Court found that the son was not liable for unlawful interference
with economic relations. There was no wrong that would be actionable by the third party
(the prospective purchasers of the building) against the dissenting son.4
This is an important decision which contains a lengthy discussion of a number of cases
from several common law jurisdictions. It is must reading for every commercial litigation
lawyer.
Fowlow v. Southlake Regional Health Centre5 - Causation in negligence
This is the first decision of the Ontario Court of Appeal to cite and comment on the test
for causation in negligence cases as outlined by the 2012 Supreme Court of Canada
decision Clements v. Clements.
The Facts
A 70 year old patient died shortly after an axillary-femoral bypass operation. The defendant
surgeon used a graft for the procedure without being aware that the graft was not
recommended for this type of surgery. The estate and family of the deceased patient
commenced a medical malpractice claim against both the surgeon and the hospital.
The trial judge (Stinon J.), in a decision released after the SCC decision in Clements, found
that the surgeon had failed to meet the standard of care. However, a causal connection was
not established between the doctor’s failures and the death of the patient. Although the
manufacturer had issued a warning against using this graft for axillary-femoral bypass, the
plaintiffs failed to show that the patient’s death was caused by the use of the graft as
opposed to a weakness in the patient’s artery or some other cause. The trial judge indicated
that the result might have been different if the plaintiffs’ had been able to (a) show that the
graft had detached in previous axillary femoral surgeries, or (b) present details as to why a
warning was issued against using the graft for this type of surgery, or (c) produce other
4 However, the Court did find the son liable for breaching his fiduciary duty as a director of the company which owned the property.
5 2014 ONCA 193
- 8 -
evidence or data indicating that using the graft would increase the risk of developing
complications after surgery.
The Court of Appeal Decision
The Court of Appeal (Jurianz, Pepall JJ.Aand Strathy J.A., as he then was) upheld the trial
decision and confirmed that this was not a case for the application of the “material
contribution” test, but rather that the “but for” test was appropriate. The Court rejected
the appellant’s submission that the plaintiffs only needed to prove that the use of the
unapproved graft materially contributed to the risk of detachment to succeed.
According to the court, the “material contribution” test, as described in Clements, may be
employed only where it is truly impossible for a plaintiff to satisfy the “but for” test, and is
particularly likely to be applicable in cases in which there are multiple tortfeasors. In
Fowlow, there was only one tortfeasor, and the plaintiffs did not prove that it was truly
impossible for them to establish “but for” causation.
Since the plaintiffs did not produce any evidence from the manufacturer of the graft or
from a pathologist that performed or witnessed the post-mortem examination, the
“impossibility” criterion could not be satisfied. The failure to call such evidence speaks to
the fact that the plaintiffs were unable to demonstrate that it was factually impossible to
demonstrate causation. This passage suggests that the Court of Appeal might be prepared
to apply the “material contribution in risk” test where it was factually impossible to
demonstrate causation. A close reading of the SCC decision in Clements suggests that this
was not the view of the SCC. It remains to be seen whether this represents an attempt by
the Court of Appeal to limit the dicta in Clements.
Bondy v. London6 - Municipalities have a statutory duty to maintain lower portions of driveways on boulevards
The Ontario Court of Appeal has upheld a trial decision which found no liability on a
municipality when a person fell on a paved residential driveway that slopes down to meet
the road. Although, the parties conceded that it was part of the “travelled portion of the
6 2014 ONCA 291
- 9 -
highway” the Court nevertheless concluded that generally the municipality only has a duty
to maintain such boulevards as highways for vehicles and not as a passageway for
pedestrian traffic.
The Facts
After heavy freezing rain, the Plaintiff fell on an icy sloped driveway sidewalk that was part
of a municipal boulevard, which connected to her neighbor’s driveway. The boulevard was
classified as a highway within the Municipal Act.
The Court of Appeal Decision
The parties acknowledged that the boulevard is a highway , within the meaning of the
Municial Act.
Neither the city nor the neighbour were liable to the Plaintiff. The Court decided that the
fact that people cross at undesignated places on a road does not create or impose an
obligation on the Municipality to maintain the boulevard at a higher level. .In this case the
pavement had become slippery because of an ice storm and the City’s response was
considered adequate. The neighbour was not responsible for the Plaintiff’s injuries. The
neighbour was not an occupier under the Occupiers’ Liability Act and nothing in the City of
London’s street by-laws imposed a duty on the property owner to remove snow and ice.
Some commenters find this precedent troubling because it would be too onerous for
municipalities in Ontario to plow, sand, or salt the lower portion of each private driveway
simply because they are technically part of the travelled portion of the highway.7
Fordham v. Dutton-Dunwich (Municipality)8-Municipalities do not owe a duty to drivers who do not drive with reasonable care
The Ontario Court of Appeal held that a municipality does not owe a duty to drivers who
drive without reasonable care.
7 For example, see the comments of Shannon Devane, director of Risl at OMEX available at: http://www.omex.org/wp-content/uploads/2013/11/Bondy-vs-City-of-London.pdf
8 2014 CarswellOnt 17325
- 10 -
The Facts
The plaintiff, a newly minted G2 driver, ran a stop sign at 80 kph on a rural road and then
was unable to negotiate a small S curve just beyond the stop sign, lost control of his vehicle
and crashed into a concrete bridge. The trial judge noted that some local drivers did not
always stop for stop signs. Although the expert evidence was to the effect that if he had
stopped he would have been able to negotiate the curve, the trial judge found that the
curve should have been signed and held the municipality 50% at fault for the plaintiff’s
serious injuries.
The Court of Appeal Decision
Although the Court of Appeal found some modest support for the proposition that not all
rural drivers in this area stopped for stop signs, Laskin J.A., speaking for the Court, noted
that there was no credible evidence that local drivers went through stop signs at the speed
limit.
More importantly, the Court held that even if there had been such evidence this was legally
irrelevant. There is not one standard for city drivers and another standard for rural drivers.
A municipality’s duty does not extend to making its roads safe for negligent drivers. A
municipality need only erect signs if failing to do so would expose an ordinary driver
exercising reasonable care to an unreasonable risk of harm.
Miller Group Inc. v. James9 - Pierringer or proportionate share settlement agreement
This appeal involved the interpretation and application of a "Pierringer" or proportionate
share settlement agreement.
The Facts
Jimmy and Brenda James (the “Jameses”) commenced this action in negligence and
nuisance for property and personal injury damages caused by a fly rock incident following
blasting at a quarry owned by the appellant Miller Group Inc. (“M”) and operated by the
9 2014 ONCA 335
- 11 -
respondents Sernoskie Bros. (“S”). M cross-claimed against S for indemnity, alleging S had
agreed to indemnify them for these types of claims and had agreed to add them as named
insureds on their liability insurance.
After discoveries, the Jameses and S entered into a Pierringer Settlement Agreement.
Following which, three motions were brought and heard together. At the conclusion of the
motion, the judge (Timothy D. Ray J.):
1. Granted the Jameses’ motion to remove S from the action and amend the statement of claim.
2. Granted S’s motion for summary judgment dismissing M’s cross-claim.
3. Dismissed the M’s motion for summary judgement to dismiss the Jameses’ claim. M was entitled to amend its statement of defence to seek a declaration for contribution and indemnity notwithstanding the removal of S from the proceedings.
M appealed the dismissal of its cross-claim against S and the dismissal of its motion for
summary judgment to dismiss the Jameses’ claim.
The Court of Appeal Decision
The Court (Sharpe, Epstein and Pepall JJ.A.) allowed the appeal. The matter was remitted
to the Superior Court for determination of whether M has a contractual right of indemnity
against S.
The Court agreed with the motion judge’s finding that M’s right to seek a reduction of its
liability and its right to a reduction of its exposure to the plaintiffs as against S by way of
contribution or indemnity was preserved. However, the motion judge erred by failing to
address the factual and substantive basis for the M’s claim for summary judgment
dismissing the Jameses’ claim. The terms of the settlement agreement and the assertion of
the indemnity agreement between M and S gave rise to a threshold question as to M's
liability for the damages claimed by the plaintiffs. The motion judge failed to deal with the
threshold issue on the summary judgment motion. The threshold issue of whether M can
establish an implied oral agreement with S for indemnification is one that should have be
determined at the summary judgment motion in accordance with the procedure outlined in
Rule 20.04(2.2).
- 12 -
Normally, Pierringer Agreements contain a term that the settling defendant can apply for a
bar order (dismissing the non-settling defendant’s crossclaim against the settling
defendant). The extracts from the agreement in the case do not refer to such a provision
but it appears that the same result was to be achieved through the motion to dismiss M’s
crossclaim by way of a summary judgment. However, by allowing M to amend its defence
to seek a declaration for contribution and indemnity S would have remained in the action.
Therefore, much of the benefit of the Pierringer Agreement would have been frustrated
from S’s perspective.
This case confirms a concern about Pierringer Agreements that has existed for some time
but has not been commented on judicially. This case essentially concludes that Pierringer
Agreement can be used to remove a defendant whose only potential liability for
contribution and indemnity arises under the Negligence Act. However, if the co-defendant’s
right to indemnity arises in contract or otherwise, then the non-settling defendant’s
crossclaim should not be dismissed unless or until the other claim for indemnity has been
shown to have no merit..
If a defendant has a realistic claim for indemnity in contract it should be pleaded. Once
pleaded, such a claim is likely to defeat any attempt by a co-defendant to enter into a
settlement that will allow the settling defendant to extract themselves from the litigation by
way of a bar order.
Mandeville v. The Manufacturers Life Insurance Company10- Anns test and Pure economic loss
The issue in this appeal was whether a company owed a novel of duty of care to
stakeholders in connection with a legitimate transaction that received regulatory approval.
The Facts
In 1999, The Manufacturers Life Insurance Company (“Manulife”) demutualized and
distributed $9 billion to its participating policyholders. Less than three years prior, Manulife
had transferred a group of Barbados policies to another life insurance company (the
10 2014 ONCA 417
- 13 -
“Transfer”). The group of Barbados policies did not receive anything from the $9 billion
disbursement. The representative plaintiffs (the “appellants”) brought a class action on
behalf of the Barbados policyholders, in which they claimed against Manulife for
negligence and breach of fiduciary duty. They alleged that Manulife knew it was likely going
to demutualize when it made the Transfer, and ought to have made arrangements to
protect their interest in the eventual demutualization. Despite finding a prima facie duty of
care based on foreseeability of harm and proximity, the trial judge (Newbould J.) refused to
recognize that Manulife owed the class members a duty of care on policy grounds. The fact
that regulators in both Canada and Barbados had approved the Transfer was sufficient
cause to relieve any duty on the part of Manulife.
The Court of Appeal Decision
The Court of Appeal, in a decision written by Gillese J.A., considered the issue of whether
the trial judge erred in refusing to recognize that Manulife owed the class members a duty
of care at the time of the Transfer. The Appeal was ultimately dismissed.
Gillese J. A. reasoned that the nature of the claim was one for pure economic loss and was
not for a loss in a proprietary right. Despite being “owners” of a mutual company
(Manulife) at the time of the Transfer, the policyholders did not have a legally recognized
right or interest in respect of a possible demutualization. The Transfer occurred before the
right to demutualize came into existence. Therefore, no right to share in demutualization
had been conferred by contract, legislation or regulation at the time of the Transfer. The
appellants had a hope or a mere expectancy - not a legally enforceable right. The class
members did not have a vested or even contingent interest in property.
Furthermore, while the Court agreed with the trial judge that harm arising to the class
members from Manulife’s decision to demutualize was reasonably foreseeable, the Court
found that the relationship between the class members and Manulife was not sufficiently
proximate such that a prima facie duty of care arose. This was the case for two reasons. First,
the appellants could not have an interest in something that was not legally possible at the
time of the Transfer, i.e. they could not have an interest in the demutualization. Second,
the Transfer and subsequent extinguishment of the appellants’ tenuous interest in Manulife
was legal and occurred under a prescribed regulatory framework.
- 14 -
The Court confirmed that policy considerations play a role at both stages of the Anns test,
and play an important role in the decision of whether to recognize a new duty of care. In
Mandeville, policy considerations militated against the finding that Manulife was given the
statutory right to end its relationship with the class members (via the Transfer) and yet
legally obligated to protect their interest in some future transaction. There was therefore no
prima facie duty of care found at stage 1 of the Anns test due to a lack of necessary
proximity.
According to the Court, there are two further policy considerations militating against the
finding of a duty of care in stage 2 of the Anns test: (1) the law’s traditional reluctance to
permit recovery for pure economic loss, and (2) the fact that the law of negligence seeks to
remedy the destruction of value as opposed to grievances about the way in which value is
distributed.
This important case contains a fulsome discussion of the various criteria provided in the
Anns tests. Anyone who has a thorny “duty of care” case would be well advised to review
this case carefully.
TMS Lighting Ltd. v. KJS Transport Inc.11 - Test for Establishing Private Nuisance
The Court of Appeal revisited and confirmed the test for establishing private nuisance.
The Facts
KJS Transport operated a trucking business that generated airborne dust, which disrupted
TMS Lighting’s manufacturing business. This appeal arose from the trial judge’s (Price J.’s)
finding that the appellants (“KJS Transport”) were liable to the respondents (“TMS
Lighting”) in both nuisance and trespass. While KJS Transport conceded that they
interfered with TMS Lighting’s use and enjoyment of their lands, they argued that the
interference was not unreasonable and that TMS Lighting did not provide sufficient
evidence to calculate nuisance-based damages.
11 2014 ONCA 1
- 15 -
The Court of Appeal Decision
In a judgment delivered by Cronk J.A., the Court considered whether the trial judge erred
in his nuisance analysis by finding that KJS Transport’s interference with TMS Lighting’s
use and enjoyment of their lands was unreasonable in the circumstances. The Court also
examined the calculation of damages for nuisance and trespass based on the available
evidence.
Cronk J. A. reached the conclusion that the trial judge did not err in his nuisance analysis,
as he appropriately applied the two-part test for establishing private nuisance as set out in
Antrim Truck Centre Ltd. v Ontario (Transportation). That test requires that the plaintiff
establish that the interference with the plaintiff’s use or enjoyment of the land is both
substantial and unreasonable. The appellant conceded that the nuisance was substantial but
argued that interference was not unreasonable. This question must be determined by
balancing the gravity of the harm against the utility of the defendant’s conduct in all of the
circumstances. The appellant’s main contention was that the respondent’s manufacturing
process was too sensitive to dust and when this factor was considered the interference was
not unreasonable. The Court of Appeal concluded that all of the factors had been
considered and the trial judge’s findings and his weighing of the various factors were
entitled to deference.
While the damages issue is somewhat beyond the scope of this paper, it is an additional
interesting issue addressed by the Court in this case. The Court found that the damage
awards were unsustainable. It is not open to a trial judge to postulate a method for the
quantification of damages that is not supported by the evidence at trial. Furthermore, the
approach taken by the trial judge did not provide the parties with the opportunity to be
tested or challenged at trial. The trial judge failed to consider whether TMS Lighting
established lost productivity damages at trial. TMS Lighting failed to lead both expert
evidence to establish the extent of damage due to lost productivity, and business records to
evidence relevant information like sales revenues or productivity hours before and after the
dust-related problems. New assessment of plaintiffs' lost productivity damages arising from
defendants' proven nuisance and trespass was required in interests of justice.
- 16 -
Raposo v. Dasilva12 - No reasonable cause of action where claim for intentional infliction of mental suffering but not acts alleged, only omissions
In this decision, the Court suggests that the tort of intentional infliction of mental suffering
cannot be grounded on an alleged omission rather than an intentional act or statement.
The Facts
This was an unhappy dispute between two siblings evolving from the circumstances of
their father's death and his subsequent funeral. A brother sued his sister for intentional
infliction of mental distress, based on, among other allegations, his claim that she failed to
notify him of their father's rapidly deteriorating medical condition and robbed him of his
chance to say his last goodbyes.
Lower Court Decision13
The elements of the cause of action for the tort of intentional infliction of mental distress
was originally articulated in Wilkinson v. Downton14 as case that has been followed and
applied for over a century. The tort of intentional infliction of mental suffering has 3
elements:
1. an act or statement by the defendant that is extreme, right flagrant or outrageous;
2. the act or statement is calculated to produce harm; and
3. the act or statements causes visible or provable harm.
No cases were cited by the plaintiff in which omission to act has been held to found a
cause of action for intentional infliction of mental distress. In Stinson J.’s view, there is a
good reason for this absence of authority. To accept this submission would be to ask the
court to impose a duty to act in questionable circumstances. It is undesirable to force the
court into the field of dictating mandatory positive acts that must be carried out so as to
avoid causing offence or unhappiness to others. Imposing positive duties such as a duty to
12 2014 ONCA 263
13 2013 ONSC 3298
14 [1897] 2 Q.B. 57
- 17 -
communicate information, such as the father’s medical condition in this case, raises a host
of other issues such as privacy concerns, limits on the scope of how far the duty may
extend, questions as to who should be subject to the duty and so on. Stinson J. concluded
that the imposition of such a duty was undesirable. The statement of claim failed to
disclose a reasonable cause of action, and the plaintiff's action was dismissed.
The Court of Appeal Decision
Raposo moved to set aside the chambers order of Rosenberg J.A., in which the judge
declined to set aside the Deputy Registrar’s dismissal of this appeal for delay and to extend
the time for perfecting the appeal from the order of a judge of the Superior Court.
The motion to set aside the dismissal order was dismissed. The Court (E.A. Cronk J.A.,
S.E. Pepall J.A., M. Tulloch J.A) agreed with the chambers judge’s assessment of the merits
of the proposed appeal and his conclusion that the pleading failed to give rise to a
reasonable cause of action.
Justice Rosenberg did not, as Raposo claimed, err in treating the merits of the appeal as the
determinative factor. The reasons show that he balanced all the relevant factors and
concluded that the interests of justice do not warrant the discretionary relief sought in this
case. Raposo was unable to point to any judicial authority in support of his argument that
the tort of intentional infliction of mental suffering can be grounded on an alleged
omission, rather than an intentional act or statement, nor did he identify any actionable
wrong by the defendant to support his claim for mental distress damages.
Hansen v. Strone Corporation15 - Discoverability and Limitation Periods
Limitation periods do not begin to run until the plaintiffs’ have in their possession
sufficient facts upon which they could allege negligence.
15 2014 ONCA 385
- 18 -
The Facts
A fire took place at the residence of the plaintiffs JH and SH. JH immediately contacted
their insurer to investigate the fire. The initial investigation indicated that the fire was
caused by the negligence of the defendant contractor, in leaving out building materials
which combusted. Further investigation confirmed the cause of the fire, with the
investigator making findings about one month after the fire and later placing these findings
in a report. JH and SH commenced a claim against the contractor and the defendant
company, 2 years and one month after the fire. The defendants moved for summary
judgment, on the basis that the claim was statute-barred.
The Summary Judgment Motion
Pierce R.S.J. dismissed the motion, as the key date in the investigation was when the
investigator confirmed the cause of the fire, which was just under 2 years before the claim
was issued. The initial investigation did not provide enough information to JH and SH to
be able to know the cause of the fire to the extent that they could have commenced an
action. The plaintiffs acted with due diligence by immediately having the fire investigated.
The claim was issued in time and summary judgment was not appropriate. The defendant
contractor and company appealed.
The Court of Appeal Decision
The Court of Appeal, comprised of Laskin J.A., Rouleau J.A., Lauwers J.A, dismissed the
appeal. The Court agreed with the reasons of the motion judge, and did not provide any
additional reasons.
Upchurch v. Oshawa (City)16 - Tort of Negligent Investigation and the Standard of Care Applicable to City Officials
The standard of care in a negligent investigation claim requires that city representatives
exercise their duties reasonably, not that their interpretation of relevant law is ultimately
correct.
16 2014 ONCA 425
- 19 -
The Facts
The appellant intended to build a new deck for his home in the City of Oshawa, and went
to the City offices to inquire whether he needed a building permit for this construction.
The appellant was told that he did not need a permit as long as the deck was no higher
than 24 inches above the adjacent grade, so he began construction immediately. A
complaint was filed about the deck soon after, and the respondent, City of Oshawa, began
an investigation and determined that a permit was required. The appellant took the position
that, because the deck was less than 24 inches above adjacent planters, no permit was
necessary; the respondent took the view that the phrase “adjacent grade” was in reference
to ground level. The appellant challenged the subsequently issued “No Permit Order” and
won at trial, it being determined that no permit was required.
The appellant then commenced the present action against the respondents alleging
negligence and malicious prosecution, with the latter claim being withdrawn shortly before
trial. The appellant’s position was that, because the Divisional Court ultimately determined
that a permit was not required under the Building Code, the City’s investigation,
enforcement action, and eventual laying of charges necessarily constituted a breach of the
required standard of care. The trail judge, Glass J., found that City officials were acting
properly in applying the Building Code when they issued the “No Permit Order”. Glass J.
held that the duty of care and the standard of care owed by city officials was met, and that
no negligence was established.
The Court of Appeal Decision
On appeal, Pardu J.A. considered the issue of whether the trial judge applied the incorrect
standard of care or applied the correct standard of care incorrectly. Pardu J.A. found that
the standard of care applied was correct and that it was correctly applied. The Appeal was
dismissed.
In the context of a claim for negligent investigation, it is insufficient to merely show that
the City’s interpretation of the Building Code was not ultimately sustained. A correct
reading of the relevant statute was not required, only a reasonable one. The trial judge
correctly determined that the standard of care in a negligent investigation claim requires
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that the City representatives exercised their duty reasonably, not that their interpretation of
the law was ultimately correct. City officials met this standard.
Stilwell v. World Kitchen Inc.17 - Product Liability and Duty to Warn
Judges must instruct civil juries that evidence of reprehensible misconduct that aggravated
a consumer's injury is necessary for an award of aggravated damages in the product liability
context.
The Facts
The appellants, World Kitchen Inc. and Corning Inc., manufactured a pot which shattered
in Stilwell’s, the respondent’s, hands and caused him significant personal injury. Corning,
which was added to the action six year after the claim was issued, brought an unsuccessful
motion to have the claim against it dismissed as statute-barred. At trial, liability was
apportioned as between the parties with World Kitchen and Corning being found 75% at
fault for failing to adequately warn of the dangers associated with the pot, and Stilwell
found 25% responsible for his own injuries. World Kitchen and Corning failed to clearly
identify what constituted a deep scratch in the pot and when a consumer should contact
the manufacturer. World Kitchen and Corning should have put emphasis on a warning
about the possibility of accidental breakage and resulting injury both in the user manual
and on packaging. At trial, Leach J. sitting with a jury, awarded the respondents total
damages of $1,157,850 for negligence related to product liability. Part of the damages
award was allocated to aggravated damages. The appellants appealed the judgment of
Leach J.
The Court of Appeal Decision
William Hourigan J.A., writing for the Court, allowed the appeal with respect to the
aggravated damages portion of the award, but upheld the remainder of the damages award.
The Court also confirmed that the claim against Corning was not statute-barred.
Regarding the issue of the limitation period, Corning failed to identify any palpable or
overriding error in the trial judge's limitation period analysis. As stated by Leach J., there
17 2014 ONCA 770
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was a good deal of support for the plaintiffs' position that, in the early stages of
investigation and litigation, the available information pointed to World Kitchen as the
entity likely to bear responsibility, if any, for the cookware.
With respect to the issue of the findings on liability, there was an evidentiary basis for the
conclusion reached by the jury. Specifically, there was an available inference that could be
drawn that the Stilwell’s wife would not have purchased the pot that injured her husband if
the appellants had placed a sufficiently clear warning label on their product. Given this
evidence, the Court was not satisfied that the jury’s verdict of liability was plainly
unreasonable or unjust, or that it was not acting judicially. I think that anyone reading this
case might conclude that this case represents the high water mark with respect to giving
deference to the findings of a jury.
Finally, all parties conceded that that the trial judge erred in his charge to the jury on the
issue of aggravated damages. Leach J. failed to advise the jury that in order to award
aggravated damages, they had to be satisfied that any increased injury to the respondent
was a result of reprehensible misconduct by the appellants. Therefore, the award of
aggravated damages was set aside.
Ernst v. EnCana Corp.18 – The Energy Resources Conservation Board does not owe a private law duty of care to landowners
In the context of damages allegedly sustained by a landowner regarding her fresh water
supply, the Alberta Court of appeal held that the Energy Resources Conservation Board
does not owe a private duty of care to a landowner.
The Facts
The plaintiff Ernst was a landowner in Alberta. She sued EnCana alleging damage to her
fresh water supply caused by EnCana's construction, drilling, hydraulic fracturing and
related activities in the region. She also sued the Energy Resources Conservation Board,
alleging negligent administration of the regulatory regime with respect to EnCana's
activities. She claimed that the Board's refusal to accept further communications from her
18 2014 ABCA 285
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violated her s. 2(b) Charter rights, and entitled her to damages. In addition, she sued the
Province alleging it breached a duty to protect her water supply and failed to adequately
respond to her claims against EnCana. The Board applied to strike portions of the claim as
against it, for failure to disclose a cause of action. The case management judge, Wittmann
C. J. Q. B., found that the plaintiff’s claim of negligence as against the Board failed since no
private law duty of care was owed by the Board to the plaintiff. The Charter claim, on the
other hand, was not so untenable that it could be struck summarily. Alternatively, any claim
against the Board, including the Charter claim, was barred by s. 43 of the Energy Resources
Conservation Act. The plaintiff appealed from the case management order striking out
portions of her claim as against Board.
The Alberta Court of Appeal Decision
The appeal was dismissed. The case management judge correctly applied test for
determining whether the Board owed a private law duty of care to the appellant. Forcing
the Board to consider the extent to which it must balance the interests of specific
individuals while attempting to regulate in the overall public interest would be unworkable
in fact and bad policy in law. Recognizing any such private duty would distract the Board
from its general duty to protect the public, as well as its duty to deal fairly with participants
in the regulated industry. Any such individualized duty of care would plainly involve
indeterminate liability, and would undermine the Board's ability to effectively address the
general public obligations placed on it under its controlling legislative scheme.19
Further, even if a private law duty of care existed, any action by the plaintiff, based on acts
or omissions, was precluded by s. 43 of the Energy Resources Conservation Act. Finally, even if
a Charter claim was potentially available, it too is barred by s. 43.
Section 43 states:
43. No action or proceeding may be brought against the Board or a member of the Board or a person referred to in section 10 or 17(1) in respect of any act or thing done purportedly in pursuance of this Act, or any Act that the Board administers, the regulations under any of those Acts or a decision, order or direction of the Board.
19 para. 18
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George v. Newfoundland and Labrador20 - No Liability of a Province for MVAs involving Moose
This decision of the Newfoundland and Labrador Supreme Court with a unique fact
scenario established that the Province does not owe a duty of care to motorists, and is not
liable under either strict liability or public nuisance, for injuries and deaths caused by motor
vehicle accidents involving moose on Provincial roads.
The Facts
A class action was brought by the plaintiffs, George and Bellows, against the defendant, the
Province of Newfoundland and Labrador, for damages related to moose and vehicle
collisions. The Province was responsible for the management of wildlife within the
Province and the development and maintenance of the Province's highway system. The
plaintiffs alleged that the Province was liable in strict liability, public nuisance and
negligence for personal injuries and deaths caused by collisions between moose and
vehicles outside of national park boundaries. Certified common issues included:
1. the Province's liability in strict liability and public nuisance,
2. whether a duty of care was owed to mitigate the risk of moose and vehicle collisions,
3. the scope of the standard of care and whether it was breached, and
4. whether the Province was required to implement measures to mitigate the risk of serious injury in moose and vehicle collisions by more than 51 per cent.
The issue was whether the defendant incurred liability for its management of the moose
population and the risk that moose posed to drivers and occupants of vehicles.
The Newfoundland and Labrador Supreme Court Decision
Stack J dismissed the action. The Province was found not liable to the Plaintiffs in the tort
of strict liability, in the tort of public nuisance, and the Province did not owe a duty of care
to the drivers and occupants of vehicles to mitigate the risk of moose vehicle collisions.
20 2014 NLTD(G) 106; [2014] N.J. No. 279
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Strict liability of the defendant was not established under the scienter doctrine (which
provides that the keeper of a wild animal is strictly liable for damages caused by the animal,
regardless of fault), under the principles in Rylands v. Fletcher, or under the emerging
principle related to abnormally dangerous activities. With respect to the scienter doctrine, the
Defendant does not own, keep or control the moose population and has not since the first
few moose were introduced more than 100 years ago. The Rylands v. Fletcher argument was
rejected because the requirement of a non-natural use of land was not met because there is
nothing unnatural about populating the forests of Newfoundland with an animal whose
natural habitat is the forest. Further, the plaintiffs did not establish any act of the Province
that was abnormally dangerous. A finding of strict liability would mean that the Province
would be liable for all human-moose interactions in the Province which result in some
form of damage, creating an untenable result.
No liability of the Province was established for the tort of public nuisance because the
presence of moose on the highway does not result from an activity of the Province.
The Province owed no private duty of care to drivers and occupants of vehicles to prevent
injury by adopting specific policies of moose population management or collision risk
mitigation.21 If such a prima facie duty of care had been found, then it would have been
negated because the Province's moose population management and collision risk mitigation
strategies were core policy decisions and immune from suit unless they were irrational or
made in bad faith. The evidence adduced at trial supported neither a finding of irrationality
nor of bad faith.
As no prima facie duty of care was found, it was unnecessary to address the common issues
related to standard of care and mitigation of risk.
January 2015
21 Para 167.