COURT OF APPEAL FOR ONTARIO

DATE: 20060612 DOCKET: C43594

RE:

JACK WESTLAKE and THELMA WESTLAKE (Plaintiffs/Respondents) v. GRANBY STEEL TANKS division of INTERNATIONAL COMFORT PRODUCTS CORPORATION (CANADA) and SKYDOME SHEET METAL INC. (Defendant/Appellant)

BEFORE:

DOHERTY, BLAIR and LAFORME JJ.A.

COUNSEL:

Mark L.J. Edwards for the appellant

David Zuber and James Schacter for the respondent

HEARD:

June 5, 2006

On appeal from the judgment of Justice MacDougall, sitting with a jury, of the Superior Court of Justice dated April 27, 2005.

ENDORSEMENT

[1] The parties were advised at the end of oral argument that the appeal would be dismissed with reasons to follow. These are those reasons.

[2] The appellant, Granby’s, submissions fall into three categories. It argues that the cumulative effect of certain events which occurred during the trial necessitated a mistrial. It asks that this court vacate the jury’s verdict and direct a new trial.

[3] Granby also argues that the general damages awarded by the jury were excessive and beyond even the broad allowances made when reviewing jury verdicts. It argues that aspects of the special damages awarded by the jury went beyond the limits of the evidence.

[4] Finally, Granby seeks leave to appeal costs, arguing that the amount awarded by the trial judge does not reflect the findings he made in respect of costs and that the reasons fail to articulate the basis upon which the trial judge arrived at the amount awarded. Counsel also argues that the trial judge erred in awarding a premium to trial counsel for the respondents.

(a) Should the trial judge have declared a mistrial?

[5] We do not agree that any of the incidents which occurred during the trial prejudiced the appellants much less that the prejudice reached the point where a mistrial was necessary.

[6] At trial, Granby argued that the respondents had failed to mitigate the damages caused by the oil spill by not taking reasonably prompt steps to clean-up their property or relocate permanently. The respondents answered by asserting that attempts to mitigate by negotiating a quick resolution had proved impossible in part because of the “hardball” position taken by the appellants’ insurer. Given the mitigation issue raised by Granby and the respondents’ reply to it, it was inevitable that the jury would come to know that the appellants were insured.

[7] Counsel for Granby does not complain that the jury was fixed with the knowledge that Granby was insured (although that complaint was raised at trial), but complains that it was prejudiced by the evidence of the respondents’ son. He testified that attempts to negotiate with the insurer eventually failed and that the insurer took the position that it was “in the business of litigation” and could outlast the respondents who were in their eighties. In cross-examination, counsel established that Granby itself never claimed to be in the litigation business. No evidence was led to suggest that the remarks attributed to the insurer by the respondents’ son had not been made.

[8] The son’s evidence was relevant given the mitigation issue. It was also unchallenged. To the extent that it may have hurt Granby’s case, it cannot be described as unfairly prejudicial. Having opened the door to the insurer’s response to attempts to negotiate a settlement by its mitigation plea, we do not think that Granby can claim that the jury should not have heard evidence of its insurer’s response to attempts to negotiate the settlement.

[9] Granby next argues that counsel for the respondents improperly asked a witness about an agreement that had been reached between Granby’s insurer and the respondents’ insurer with respect to certain aspects of the claim. The trial judge told the jury that the question was improper and they should ignore it. Later, he went a step further and told the jury that the premise of the question, that is that the two insurers had reached some form of settlement, was in fact wrong and there was no settlement. The trial judge’s instructions cured any possible prejudice flowing from the question.

[10] The third complaint raised by Granby arises out of the trial judge’s decision to allow the respondents to produce a sample of contaminated water taken from their property. The sample had been taken the day before the expert testified and Granby had no notice that the respondents would offer the sample into evidence. The sample had a strong odour of oil. Granby had the opportunity to take whatever samples of the water it wanted from the respondents’ property. Some time prior to the trial, Granby had taken a sample of water from the drill hole from which the respondents’ sample was taken.

[11] The sample had some probative value on the question of damages in that it provided evidence of the extent and nature of the odour caused by the oil contamination. The sample did not unfairly prejudice Granby. Granby could have led evidence of its own sample taken from the same place if that sample in any way contradicted the evidence adduced by the respondents. Granby was also able to respond to the evidence of the sample with evidence that samples taken from other drill holes closer on the property to the respondents’ home had no odour.

[12] The final complaint made on behalf of Granby arises out of counsel’s closing submissions on behalf of the respondents at trial. Counsel referred to the eleventh hour admission of liability by Granby as partial justice for the respondents and indicated that his clients sought full justice from the jury.

[13] The trial judge told the jury that the admission of liability by Granby and the timing of that admission were irrelevant to their task. I see nothing inherently prejudicial in counsel’s submission to the jury that his clients were seeking full justice from them.

[14] I would add that the trial judge invited Granby to move to strike the jury in view of the many references to insurance which were made in the course of the testimony. Granby declined to do so. That position seems inconsistent with the claim on appeal that the events described above somehow poisoned the trial and prevented the jury from arriving at a proper verdict.

(b) The damage assessment

[15] Granby argues that the amount awarded by the jury for loss of value of the respondents’ home and the amount awarded for clean-up costs exceeded the amounts put forward in the testimony of the experts for the respondents.

[16] We read the evidence differently. The amount awarded by the jury for clean-up costs was within the range identified by the respondents’ expert. Clearly, it was near the top of that range, but it was within the range. The amount awarded by the jury for loss of value of the house as a result of the oil spill was slightly more than the figure provided by the respondents’ expert. However, that expert testified that the property was worth “about 15 percent” less as a result of the oil spill. The amount awarded by the jury equalled about 17 percent of the value of the home. In our view, the difference between the award by the jury and the figure provided by the expert does not warrant appellate intervention. An award of 17 percent of the value is not inconsistent with evidence that the value of the property decreased by “about 15 percent.”

[17] The main argument advanced on the damages part of the appeal was directed at the award for general non-pecuniary damages. The jury awarded each of the respondents $250,000 under this head of damage. Counsel submits that the amount is so excessive as to be beyond the pale of anything that could be regarded as reasonable. In support of this argument, he points out that the respondents led no medical evidence of any difficulties experienced by them as a result of the oil spill. He also submits that the other heads of damage ensured that the respondents would be fully compensated for all their economic losses. He submits that an award in the amount of $250,000 each for emotional distress and loss of enjoyment is well beyond amounts awarded in similar cases. Counsel contends that the amount awarded can be explained only the basis that the jury, despite instructions to the contrary, decided to punish Granby for what the jury considered its improper treatment of the elderly respondents.

[18] Counsel also submits that the judicially imposed cap on general damages in catastrophic personal injury cases should apply here and that while the award is below the cap, it is sufficiently close to the cap to demonstrate its unreasonableness given the absence of any significant injuries to the respondents.

[19] We do not think that this is a case where the applicability of the cap to general non-pecuniary damages in this kind of negligence case can be decided. The amount awarded is below the cap, assuming the cap applies. Nor did the parties join issue at trial on the issue of the applicability of the cap. Instead, Granby took the position that as this was not a personal injury case, the trial judge had no statutory authority to provide a range of general damages for the jury. No range was left with the jury.

[20] There was no objection to the charge to the jury as it applied to general damages. We have read the charge. In our view, it fairly and fully presents the issues relevant to the assessment of general damages to the jury. The jury was cautioned against using general damages to punish Granby.

[21] This was the kind of case where different juries could take very different views of the proper monetary measure of the pain and suffering and loss of enjoyment of life suffered by the respondents. In the absence of any ongoing medical problems, some juries might have awarded the respondents a relatively modest award. There was however, compelling evidence that the oil spill and its aftermath whereby the respondents lost their home, struck at the heart of the respondents’ entire existence in a unique and powerful way. The jury could have concluded that as a result of Granby’s negligence, the respondents had lost permanently a home around which the rest of their life revolved. The jury could have viewed this as a case in which Granby’s negligence virtually destroyed the respondents’ enjoyment of their life for many years and left the respondents at an advanced age in a position where they could never regain the enjoyment they had before the oil spill. If a jury took that view, a very significant award of general non-pecuniary damages would follow.

[22] We must assume that the jury took the view of the case that was reasonably open to them that most favoured the respondents. Viewed from that perspective, we cannot say that the award, while high, was so high as to shock the conscience of the court. Consequently, we cannot interfere.

(c) Costs

[23] Granby seeks leave to appeal the award of costs at trial. While we would grant leave to appeal, we are not prepared to interfere with the costs order made by the trial judge.

[24] Granby’s first argument is essentially one of quantum. It acknowledges that the trial judge properly ordered costs on a substantial indemnity basis after the respondents made an offer and he acknowledges that the trial judge properly considered the various relevant factors. It submits that the amount awarded is unexplained and too high. Given that the trial judge properly identified the point at which substantial indemnity costs were appropriate and properly referred to the various principles, we cannot say that the amount awarded is so high to demand correction by the court. To the contrary, it seems to fall well within what one could reasonably expect by way of costs.

[25] We also would not interfere with the trial judge’s decision to award counsel for the respondents a relatively modest premium. The trial judge referred to the applicable principles controlling the exercise of his discretion and we see no error in principle in the order he made.

(d) Costs of the appeal

[26] The respondents are entitled to their costs of the appeal on a partial indemnity basis. Having heard submissions from counsel, we would award costs in the amount of $25,000, inclusive of disbursements and GST.

“Doherty J.A.”

“R.A. Blair J.A.”

“H.S. LaForme J.A.”