Tag: Proximity

Government Housing Loan Potentially Leads to Private Law Duty of Care in Brain Injury Case


Reasons for judgement were released recently by the BC Supreme Court, Vancouver Registry, discussing whether a government home improvement loan can create a private law duty of care.
In last month’s case (Benoit v. Banfield) the Plaintiff suffered a serious brain injury when falling from a staircase built by the Defendant. The Defendant reportedly built the stair case “without handrails or guards“.
The construction was financed in part by a forgivable loan provided by the Canada Mortgage and Housing Corporation (“CMHC”). The loan was part of a program called the Canadian Home Renovation Plan. The money was to be advanced “upon satisfactory completion of the work” by the homeowner and CMHC was to conduct two inspections to ensure the work was “completed satisfactorily“.
The Plaintiff sued the homeowner and also the CMHC. The CMHC applied to dismiss the lawsuit arguing that their limited relationship to the plaintiff did not create a private law duty of care. Madam Justice Wedge disagreed and allowed the lawsuit to proceed. In doing so the Court provided the following reasons:

[39] In the present case, CMHC offered grants of up to $3,000 per applicant for a one-year period. The pool of funds from which to draw was limited in the amount of $30 million. Thus, even were one to consider the possibility of a duty of care to all loan recipients, the number of persons is not indeterminate. In the context of the present case, liability extends only to the class of persons who might reasonably be foreseen as users of the defective staircase in question.

[40] Thus, I conclude that on the facts as pleaded by the infant plaintiff, there is a reasonable prospect of successfully establishing proximity. The plaintiff’s claim is grounded in allegations of specific conduct by CMHC concerning the creation of the defective staircase and its negligent inspections.

[41] As noted by the Supreme Court of Canada in Imperial Tobacco at para. 47:

… where the asserted basis for proximity is grounded in specific conduct and interactions, ruling a claim out at the proximity stage may be difficult. So long as there is a reasonable prospect that the asserted interactions could, if true, result in a finding of sufficient proximity, and the statute does not exclude that possibility, the matter must be allowed to proceed to trial, subject to any policy considerations that may negate the prima facie duty of care at the second stage of the analysis.

[42] This case falls squarely within the circumstances described in that passage, and accordingly the motion to strike is dismissed.

Lawsuit Against Delta Police Following Bar Fight Dismissed


Lengthy reasons for judgement were released this week by the BC Supreme Court, Vancouver Registry, disposing of a personal injury lawsuit launched by a former NHL enforcer against the Delta Police and others following a 2006 assault which occurred at the Cheers Pub in Delta, BC.
In this week’s case (Burnett v. Moir) the Plaintiff suffered a moderately severe traumatic brain injury after being struck on the head with a bar stool.  The injury ended the Plaintiff’s professional hockey career.
There was video surveillance which showed “an assailant striking the plaintiff on the head with a bar stool taken from the premises afer he apparently stumbled and fell to the ground as he and the others were being ejected“.  The assailant was never identified.
The Plaintiff sued the owners and managers of the Cheers Pub, the local police, and the local government for compensation for his personal injuries.  Prior to trial he settled his case with the Pub.  The Plaintiff alleged that the local police and the local government were liable because they “failed to properly identify Cheers as a nuisance to the public, a trap for the unwary, and to take pre-emptive steps to abate the danger it represented to potential patrons”.
The Plaintiff led evidence to support his allegations including evidence that from 1998-2007 “there were a total of 2,410 police service calls to Cheers during that period, 231 of which were for assaults, 9 of which were for uttering threats, 10 of which were obstructing a peace officer, 138 for suspicious person/vehicle occurrences, 200 of which were for creating a disturbance, 217 for “unspecified assistance” and 1,605 of which were for “other”“.
Despite this evidence the lawsuit was dismissed with the Court finding that the Police and Local Government did not owe the Plaintiff a duty of care in these circumstances. Mr. Justice Cullen summarized his analysis as follows :

[411] The presence or absence of a close causal connection between the negligence alleged and the harm caused is a factor in determining proximity.  In Odhavji Estate v. Woodhouse, supra,Iacobucci J. held as follows in the context of a proximity analysis at para. 57:

Although a close causal connection is not a condition precedent of liability, it strengthens the nexus between the parties.

[412] Where, as here, the causal connection, insofar as the failure to warn is concerned, is remote and speculative rather than close, it cannot be said that the nexus between the parties is strong or compelling.

[413] For those reasons, while finding some limited evidence of a connection between the Delta Defendants and prospective Cheers patrons arising from the police corporate knowledge that a person entering Cheers was likely to be exposed to an environment involving some violent or turbulent circumstances, I am not satisfied the evidence reaches the level of establishing a close and direct relationship featuring the indicia of proximity identified by Chief Justice McLachlin in Hill v. Hamilton Wentworth, supra, or manifested in other decisions such as Jane Doe, Mooney, orSchacht.

[414] I thus conclude the relationship at issue does not sustain sufficient proximity to found a duty of care.  The plaintiff was but one of a large indeterminate pool of potential patrons of Cheers, rather than an identifiable potential victim of a specific threat.

Striking Pleadings Under Rule 9-5: The "No Reasonable Prospect of Success" Test


The Supreme Court of Canada recently addressed the legal framework for striking pleadings pursuant to Rule 9-5.  In short, the Court repeated the longstanding test that pleadings will only be dismissed under the BC Supreme Court Rules if they have ‘no reasonable prospect of success‘ and that the parties cannot tender evidence in support of these applications.
In the recent case (R v. Imperial Tobacco Ltd.) the Court was faced with a lawsuit by British Columbia seeking to recover health care costs for tobacco related illnesses.  In the course of defending the lawsuit the tobacco companies issued Third Party Pleadings against the Government of Canada pleading that if they are held liable to the Government of BC the Federal Government should indemnify the Tobacco Companies for damages payable.  The Government of Canada brought an application to dismiss the Third Party Pleadings.
The Supreme Court of Canada granted the application and dismissed the Third Party Pleadings.  In doing so the Court provided the following legal framework for Pleading strike applications:
This Court has reiterated the test on many occasions.  A claim will only be struck if it is plain and obvious, assuming the facts pleaded to be true, that the pleading discloses no reasonable cause of action… Another way of putting the test is that the claim has no reasonable prospect of success.  Where a reasonable prospect of success exists, the matter should be allowed to proceed to trial…

[19] The power to strike out claims that have no reasonable prospect of success is a valuable housekeeping measure essential to effective and fair litigation.  It unclutters the proceedings, weeding out the hopeless claims and ensuring that those that have some chance of success go on to trial.

[20] This promotes two goods — efficiency in the conduct of the litigation and correct results.  Striking out claims that have no reasonable prospect of success promotes litigation efficiency, reducing time and cost.  The litigants can focus on serious claims, without devoting days and sometimes weeks of evidence and argument to claims that are in any event hopeless.  The same applies to judges and juries, whose attention is focused where it should be — on claims that have a reasonable chance of success.  The efficiency gained by weeding out unmeritorious claims in turn contributes to better justice.  The more the evidence and arguments are trained on the real issues, the more likely it is that the trial process will successfully come to grips with the parties’ respective positions on those issues and the merits of the case.

[21] Valuable as it is, the motion to strike is a tool that must be used with care.  The law is not static and unchanging.  Actions that yesterday were deemed hopeless may tomorrow succeed.  Before Donoghue v. Stevenson, [1932] A.C. 562 (H.L.) introduced a general duty of care to one’s neighbour premised on foreseeability, few would have predicted that, absent a contractual relationship, a bottling company could be held liable for physical injury and emotional trauma resulting from a snail in a bottle of ginger beer.  Before Hedley Byrne & Co. v. Heller & Partners Ltd., [1963] 2 All E.R. 575 (H.L.), a tort action for negligent misstatement would have been regarded as incapable of success.  The history of our law reveals that often new developments in the law first surface on motions to strike or similar preliminary motions, like the one at issue in Donoghue v. Stevenson. Therefore, on a motion to strike, it is not determinative that the law has not yet recognized the particular claim.   The court must rather ask whether, assuming the facts pleaded are true, there is a reasonable prospect that the claim will succeed.  The approach must be generous and err on the side of permitting a novel but arguable claim to proceed to trial.

[22] A motion to strike for failure to disclose a reasonable cause of action proceeds on the basis that the facts pleaded are true, unless they are manifestly incapable of being proven: Operation Dismantle Inc. v. The Queen, [1985] 1 S.C.R. 441, at p. 455.  No evidence is admissible on such a motion: r. 19(27) of the Supreme Court Rules (now r. 9-5(2) of the Supreme Court Civil Rules).  It is incumbent on the claimant to clearly plead the facts upon which it relies in making its claim.  A claimant is not entitled to rely on the possibility that new facts may turn up as the case progresses.  The claimant may not be in a position to prove the facts pleaded at the time of the motion.  It may only hope to be able to prove them.  But plead them it must.  The facts pleaded are the firm basis upon which the possibility of success of the claim must be evaluated.  If they are not pleaded, the exercise cannot be properly conducted…

It is not about evidence, but the pleadings.  The facts pleaded are taken as true.  Whether the evidence substantiates the pleaded facts, now or at some future date, is irrelevant to the motion to strike.  The judge on the motion to strike cannot consider what evidence adduced in the future might or might not show.  To require the judge to do so would be to gut the motion to strike of its logic and ultimately render it useless.

[24] This is not unfair to the claimant.  The presumption that the facts pleaded are true operates in the claimant’s favour.  The claimant chooses what facts to plead, with a view to the cause of action it is asserting.  If new developments raise new possibilities — as they sometimes do — the remedy is to amend the pleadings to plead new facts at that time.

[25] Related to the issue of whether the motion should be refused because of the possibility of unknown evidence appearing at a future date is the issue of speculation.  The judge on a motion to strike asks if the claim has any reasonable prospect of success.  In the world of abstract speculation, there is a mathematical chance that any number of things might happen.  That is not what the test on a motion to strike seeks to determine.  Rather, it operates on the assumption that the claim will proceed through the court system in the usual way — in an adversarial system where judges are under a duty to apply the law as set out in (and as it may develop from) statutes and precedent.  The question is whether, considered in the context of the law and the litigation process, the claim has no reasonable chance of succeeding.

This decision is also worth reviewing for the Court’s discussion of the concepts of proximity, forseeability, and private law duties of care which I will address in a separate post.

BC Supreme Court Finds Liability Can Follow Unreasonably Low Certification Standards

(UPDATE October 27, 2011:  An appeal of the below decision was dismissed by the BC Court of Appeal on October 27, 2011. Despite upholding the trial result the BC Court of Appeal provided comments on the Duty of Care of CSA at paragraphs 58-61 differing from the below analysis.  The Court of Appeal concluded that “For policy reasons, CSA does not have a duty of care in negligence to hockey players who are injured while wearing certified hockey helmets“)

Earlier this week the BC Supreme Court, Victoria Registry, released reasons for judgement dismissing a lawsuit for compensation as a result of a traumatic brain injury sustained during a hockey game (More v. Bauer Nike Hockey Inc).
The incident occurred in 2004 when the Plaintiff was 17 years old.  He was playing an organized game of hockey.  He was wearing a helmet which was certified by the Canadian Standards Association (the “CSA”) and met all CSA standards.   During the game the Plaintiff fell into the boards and suffered a subdural hematoma.  This was apparently the only reported incident of a helmeted player sustaining a subdural hematoma while playing organized hockey in Canadian history.
The effects of the injury caused severe and profound disability in the Plaintiff.  The Plaintiff sued various Defendants including the manufacturer of the helmet and the CSA.  The Plaintiff alleged that the helmet was negligently manufactured and that the CSA was negligent in failing to adopt proper standards for helmet certification.  The Plaintiff’s claims were ultimately dismissed with the Court finding that the helmet was not defectively manufactured and that the standards set by the CSA were appropriate.
This case has received considerable press in Canada and abroad even gaining mention in the New York Times sports blog.  What interests me most about this case is not the ultimate result rather it was the Court’s discussion of the potential liability of institutions which set inadequate safety standards.
In the course of the lawsuit the CSA argued that even if their standards were unreasonably low they could not be sued because they did not owe the Plaintiff a duty of care.  Mr. Justice Macaulay disagreed and held that institutions that set certification standards for safety equipment can be sued in negligence if they set their standards too low.  Specifically the court held as follows:

212] I am satisfied that it was reasonably foreseeable that a hockey player and wearer of a mandatory certified hockey helmet might suffer harm if the CSA set the certification standard unreasonably low in the circumstances. On the question of proximity, I extrapolate from Cooper at paras. 32–34. Is the player, who must obtain and wear a certified helmet in order to participate in organized hockey, so closely and directly affected by the CSA decision respecting the adequacy of the certification standard that the latter ought reasonably to have the player’s legitimate interest in safety in mind? In my respectful view, the answer must be yes.

[213] By legislative definition, any hockey helmet that is not certified is a hazardous product and cannot be sold in Canada. No matter how well designed the helmet may, in fact, be, no manufacturer can offer it for sale unless it is certified. The consumer hockey player has no choice and buys, or otherwise obtains, the helmet for the purpose of self-protection in a game that has inherent dangers. Nonetheless, there is some reliance by the consumer on the fact of certification and an expectation that the risk of at least some injuries is reasonably reduced. Otherwise, there would be no need for any helmet at all.

[214] With the greatest of deference to the possibility that Hughes stands for a different outcome, I am satisfied that there is sufficient proximity in the present case for a prima facie duty of care.

In short, this decision means that if an institution sets certification standards for products to be sold in British Columbia that institution may be liable if their standards are set at an unreasonably low level.

When Can a Third Party Be Responsible for Preventing Harm Intentionally Caused by Another? The Supreme Court of Canada Weighs in


If someone is injured/killed intentionally by someone else can a third party be held civilly liable for failing to prevent the harm?  While the answer to this question turns heavily on the facts the answer can be yes and earlier this month the Supreme Court of Canada released a decision discussing this complex area of personal injury law.
In Fullowka v. Pinkerton’s of Canada Ltd. nine workers were killed in the course of a contentious labour dispute.   During the bitter strike one of the strikers “evaded security and surreptitiously entered the mine.  He set an explosive device which, as he intended, was detonated by a trip wire, killing nine miners.”
The survivors of the dead miners brought a lawsuit against various parties including the mine’s owners, their security firm and the territorial government claiming damages for “negligently failing to prevent the murders“.
The lawsuit largely succeeded at trial but was overturned by the Court of Appeal.  The Supreme Court of Canada ultimately sided with the Court of Appeal but before dismissing the case highlighted some important legal principles addressing the need to take reasonable steps in certain circumstances to prevent foreseeable intentionally inflected harm at the hands of others.  Some of the highlights of the Court’s discussion were as follows:

The analysis turns on whether the relationship between the appellants and the defendants discloses sufficient foreseeability and proximity to establish a prima facie duty of care and, if so, whether there are any residual policy considerations which ought to negate or limit that duty of care… The analysis must focus specifically on the relationships in issue, as there are particular considerations relating to foreseeability, proximity and policy in each…

[19] In my view, the relationship between the murdered miners and Pinkerton’s and the government meets the requirements of foreseeability and proximity such that a prima facie duty of care existed.  I also conclude that these prima facie duties are not negated by policy considerations…

[26] In cases of this nature, the law requires close examination of the question of proximity. The inquiry is concerned with whether the case discloses factors which show that the relationship between the plaintiff and the defendant was sufficiently close and direct to give rise to a legal duty of care, considering such factors as expectations, representations, reliance and the property or other interests involved….  Proximity is not confined to physical proximity, but includes “such close and direct relations that the act complained of directly affects a person whom the person alleged to be bound to take care would know would be directly affected by his careless act”…

[27] The Court discussed proximity in detail in Childs, at paras. 31-46.  In Childs, as here, the proposed duty was to take care to prevent harm caused to the plaintiff by a third party; in other words, what was proposed there was a positive duty to act even though the defendant’s conduct had not directly caused foreseeable physical injury to the plaintiff. The Court noted that there are at least three factors which may identify the situations in which the law has recognized such duties (paras. 38-40).  The first is that the defendant is materially implicated in the creation of the risk or has control of the risk to which others have been invited.  The second is the concern for the autonomy of the persons affected by the positive action proposed.  As the Chief Justice put it: “The law … accepts that competent people have the right to engage in risky activities … [and] permits third parties witnessing risk to decide not to become rescuers or otherwise intervene” (para. 39). The third is whether the plaintiff reasonably relied on the defendant to avoid and minimize risk and whether the defendant, in turn, would reasonably expect such reliance….

The relevant question is whether the miners reasonably relied on Pinkerton’s to take reasonable precautions to reduce the risk.  The Court of Appeal found that was their reasonable expectation. This reasoning, in my view, supports rather than negates the existence of sufficient proximity.  The fact that, as the Court of Appeal noted, any higher expectation on the miners’ part would have been unreasonable was not relevant to the analysis.

[31] Pinkerton’s must have shared the miners’ expectation.  It was there to protect property and people. The whole point of its presence was to help secure the site so that the mine could continue to operate. The miners who continued to work during the strike made up a well-defined and identifiable group. Pinkerton’s surely ought to have expected that the very people it was there to protect would rely on it to exercise reasonable care in doing so.

[32] Pinkerton’s also undertook to exert some control over the risk..Pinkerton’s undertook to exert some control over everyone who came onto the property, including Mr. Warren…

[34] I conclude that the reasonable expectations of both the miners and Pinkerton’s as well as Pinkerton’s undertaking to exert some control over the risk to the miners supported the trial judge’s finding of proximity…

[70] The concern about indeterminate liability is not valid here.  This policy consideration has often held sway in negligence claims for pure economic loss. But even in that context, it has not always carried the day to exclude a duty of care.  The concern is that the proposed duty of care, if accepted, would impose “liability in an indeterminate amount for an indeterminate time to an indeterminate class”, to use the often repeated words of Cardozo C.J. in Ultramares Corp. v. Touche, 174 N.E. 441 (N.Y. 1931), at p. 444.  At the root of the concern is that the duty, and therefore the right to sue for its breach, is so broad that it extends indeterminately.  In this sense, the policy concern about indeterminate liability is closely related to proximity; the question is whether there are sufficient special factors arising out of the relationship between the plaintiff and the defendant so that indeterminate liability is not the result of   imposing the proposed duty of care: see, e.g., Canadian National Railway Co. v. Norsk Pacific Steamship Co., , [1992] 1 S.C.R. 1021, at p. 1153.  What is required is a principled basis upon which to draw the line between those to whom the duty is owed and those to whom it is not: see, e.g., Bow Valley Husky (Bermuda) Ltd. v. Saint John Shipbuilding Ltd., , [1997] 3 S.C.R. 1210, at para. 64, per McLachlin J. (as she then was).

[71] I do not see this as a difficulty here and, as a result, I do not think that the proposed duty of care exposes the government to indeterminate liability.  What is in issue is liability for physical injury to miners caused by an explosion in a mine which, it is alleged, would have been prevented had the government taken reasonable care in discharging its  statutory duties in relation to mine safety.  The duty is to the finite group of miners working in the mine which the inspectors had inspected repeatedly.  The potential liability is no more indeterminate than in the building inspector cases I reviewed earlier.

While this case was highly factually specific the legal principles discussed by the Supreme Court of Canada can be applied to more commonly seen fact patters.  One example of intentional harm at the hands of others are the unfortunate cases involving sexual abuse.  Where priests, teachers or other adults in authority sexually abuse young victims liability may extend beyond the person committing the crime.  In certain circumstances religious hierarchies have been found liable for sexual abuse committed by priests and school boards have been found liable for abuse committed by teachers.

The Supreme Court of Canada’s detailed reasoning in this case is welcome for anyone advancing a personal injury lawsuit involving an intentional harm seeking to extend liability further and I suggest that any Canadian lawyers prosecuting such a claim familiarize themselves with this judgement in full.

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If you would like further information or require assistance, please get in touch.

ERIK
MAGRAKEN

Personal Injury Lawyer

When not writing the BC Injury Law Blog, Erik is the managing partner at MacIsaac & Company, based in Victoria, B.C. He is also involved with combative sports regulatory issues and authors the Combat Sports Law Blog.

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