Tricks of the Trade Conference Tort Update 2015...Tricks of the Trade Conference Tort Law Update 2014 Introduction1 There have been several significant cases this past year which every

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


TMS Lighting Ltd. v. KJS Transport Inc. - Test for Establishing Private Nuisance ........14

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The Facts .................................................................................................................................14


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


Hansen v. Strone Corporation - Discoverability and Limitation Periods ..........................17

The Facts .................................................................................................................................18

The Summary Judgment Motion ..........................................................................................18


Upchurch v. Oshawa (City) - Tort of Negligent Investigation and the Standard of Care Applicable to City Officials .......................................................................................................18

The Facts .................................................................................................................................19


Stilwell v. World Kitchen Inc. - Product Liability and Duty to Warn .................................20

The Facts .................................................................................................................................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.

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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.

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“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.

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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

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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

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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 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

http://www.omex.org/wp-content/uploads/2013/11/Bondy-vs-City-of-London.pdf

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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.


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

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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 (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).

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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

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“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, 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.

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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

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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.


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, 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.


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.


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

- 24 -

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.

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