DATE: 20010207

DOCKET: C34800

COURT OF APPEAL FOR ONTARIO

FINLAYSON, ABELLA and FELDMAN JJ.A.

BETWEEN:

PDC 3 LIMITED PARTNERSHIP

Sharon Addison for the appellant PDC 3

Plaintiff/Appellant

• and -

BREGMAN + HAMANN ARCHITECTS, SCOTT ASSOCIATES, ARCHITECTS INC., THE FOUNDATION COMPANY OF CANADA LIMITED, MARSHALL MACKLIN MONAGHAN LIMITED, and AIRPORT GROUP CANADA INC.

Defendants/Respondents

Donald E. Short, Bruce Salvatore and Vincent Kazmierski for the respondent Airport Group

Timothy J. Murphy and Teresa J. Walsh for the respondent The Foundation Company

Gary Gibbs and Michelle Brodey for the respondent, Bregman + Hamann

HEARD: January 16, 2001

On appeal from the order of Justice Sandra Chapnik dated July 10, 2000

FELDMAN J.A.

[1] The Respondents Airport Group and Foundation Company moved before Chapnik J. under Rule 21 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, for the determination before trial of a question of law. This procedure was opposed by the appellant both on the motion and again in this court. For the reasons given below, we agree that the issue of law should not have been determined on a Rule 21 motion before trial.

[2] The legal issue is both complex and important. It involves the interpretation and application of s. 1 of the Negligence Act, R.S.O. 1990, c. N-1. The case involves the construction and maintenance of the roof of Terminal 3 at the Pearson International Airport. The roof failed and an action has been brought by the successor to the owner in contract and tort against each of the respondents for damages in the amount of $10,000,000. Bregman + Hamann were the architects on the project. Their contract with the owner included a clause limiting their liability for damages in respect of any problems with the roof to $250,000. The other contracts between the owner and the contractor, the roofer and the maintenance provider included no such limit on liability.

[3] The respondents have claimed contribution and indemnity under the Negligence Act against one another. Section 1 of the Act provides:

1. Where damages have been caused or contributed to by the fault or neglect of two or more persons, the court shall determine the degree in which each of such persons is at fault or negligent, and, where two or more persons are found at fault or negligent, they are jointly and severally liable to the person suffering loss or damage for such fault or negligence, but as between themselves, in the absence of any contract express or implied, each is liable to make contribution and indemnify each other in the degree in which they are respectively found to be at fault or negligent.

[4] The motions judge was asked to decide two questions arising out of the fact that the owner had agreed by contract with one of the alleged tortfeasors, Bregman + Hamann, for a maximum exposure in damages of $250,000, paraphrased as follows:

1. Could the other respondents obtain contribution from Bregman + Hamann in an amount in excess of $250,000?

2. Is the owner prevented by its contract with Bregman + Hamann and the operation of s. 1 of the Negligence Act from recovering from the other tortfeasors any amount in excess of $250,000 attributable to the negligence of Bregman + Hamann?

[5] The motions judge determined, over the objection of the appellant, that the motion was properly brought under Rule 21, on the basis that although they were not raised directly, the issues arose out of the pleadings, and that they are pure questions of law that do not require a full factual background for their determination. She concluded in the language of the rule, that the determination of the questions of law “may well dispose of all or part of the action, shorten the trial or result in a substantial saving of costs.”

[6] The motions judge dealt succinctly and thoroughly with the legal issues and arrived at findings of law which determined clear answers to the questions. In so doing, she acknowledged in her analysis that there is nothing in the case law or the statute which deals with the first question.[^1] She also noted in connection with the second question, that a conclusion in the 1988 Ontario Law Reform Commission Report on Contribution Among Wrongdoers and Contributory Negligence reflected the law as it stood at that time, but nevertheless applied subsequent case law and analysis to conclude that the law had changed. Part of the analysis referred to defeating “the reasonable expectations of the contracting parties.”

[7] From the reasons of the motions judge, it is clear that the issues raised are legally novel and complex, as well as important. Furthermore, in determining them, the motions judge necessarily applied factual considerations arising in her view from the pleadings and from the agreed statement of facts.

[8] In our view, this was not an appropriate case to be decided under Rule 21. On the hearing of the appeal, counsel were asked to assist the court with how the determination of the two issues would either shorten the trial, which is scheduled for six months, dispose of all or part of the of the action or save costs. Counsel essentially acknowledged that notwithstanding a determination of the Rule 21 questions, unless there is a settlement of the action, it will still be necessary for the court to hear all of the evidence in order to make findings as to the damages suffered by the plaintiff and the degree of responsibility of each defendant and third party for those damages.

[9] Counsel’s intent was to obtain a predetermination of the legal issues in the case in order to facilitate settlement negotiations. Of course, if a settlement of the whole or part of the case had been agreed to and structured as dependant on the determination of the legal issues, a determination of those issues would clearly save costs. However, that was not the situation here.

[10] In effect the situation here is not much different than in many cases before trial, where the parties would like to know with certainty the outcome of an important legal issue in the case in order to decide whether and on what basis to settle before trial. However, that goal alone is neither the purpose nor the effect of Rule 21, nor can the court operate in that way.

[11] Important issues of law are normally decided based on a full factual record which allows the trial judge to make findings which form the basis for the legal analysis and conclusions. For example, in this case, the court may need to ascertain, based on the evidence, the reasonable expectations of the parties.

[12] It is not clear, based on the pleadings and the agreed statement of facts, whether and to what extent the evidence that will be led at trial will become important or be necessary in deciding the two legal questions put forward on this motion. However, it is premature for the court to conclude that the evidence will be neither relevant nor determinative. This is particularly so where both legal conclusions involve important pronouncements of the law interpreting s. 1 of the Negligence Act and in circumstances which will have precedential value.

[13] In the result, the appeal is allowed and the order of the motions judge is set aside. The costs of the motion and of the appeal are to the appellant.

Signed: "K.N. Feldman J.A."

"G.D. Finlayson J.A."

"R. S. Abella J.A."

RELEASED: February 7, 2001

[^1]: See Martin v. Listowel, 2000 CanLII 16947 (ON CA), [2000] O.J. No. 4015 (C.A.) decided on a related issue since the motion.