144096 Canada Ltd. (USA) et al. v. The Attorney General of Canada et al.

[Indexed as: 144096 Canada Ltd. (USA) v. Canada (Attorney General)]

63 O.R. (3d) 172

[2003] O.J. No. 147

168 O.A.C. 201

Docket No. C38056

Court of Appeal for Ontario

Morden, Borins and Simmons JJ.A.

January 24, 2003

Limitations -- Crown liability -- Vicarious liability -- Action against customs official and Attorney General of Canada for wrongful seizure of [page173] aircraft under the Customs Act -- Defendants pleading limitation period defence -- Genuine issue for trial about whether Crown employee acting with malice and intent to injure -- Genuine issue for trial about whether limitation period applied because of custom official's alleged malice and intent to injure -- Motion for summary judgment dismissed -- Customs Act, R.S.C. 1985, c. 1 (2nd Supp.), s. 106(1) -- Crown Liability and Proceedings Act, R.S.C. 1985, c. C-50, ss. 3, 10, 24, 32 -- Public Authorities Protection Act, R.S.O. 1990, c. P.38, s. 7.

The plaintiffs, RW and two corporations, were in the business of buying and selling aircraft and aircraft parts. In April 1995, the defendant NP, on behalf of Canada Customs, seized five aircraft and a helicopter that the plaintiffs had in Canada. The seizure was made on the basis that there had been a breach of the Customs Act. In May 1996, a Cessna 185 aircraft was also seized, but it was returned in June 1996. Proceedings brought in the Federal Court established that there had been no breach of the Customs Act and, after the aircraft and helicopter were returned, in 1998, the plaintiffs sued NP and the Attorney General of Canada for damages associated with the wrongful seizure and storage of the aircraft. Their action was dismissed on a motion for summary judgment; Jennings J. held that the action was barred by s. 106(1) of the Customs Act, which provides that no action shall be brought against an officer for anything done in the performance of his duties under the Act more than three months after the time when the cause of action or the subject matter of the proceeding arose. The plaintiffs appealed.

Held, the appeal should be allowed.

Accepting that s. 106(1) of the Customs Act applied to the plaintiffs' claim against NP, s. 106(1) barred a claim with respect to the performance of duties under the Customs Act or any other Act of Parliament. However, the plaintiffs' allegation that NP had acted in malice or with an intention to injure was raised sufficiently so that the application of the limitation period to the claim against NP required a trial. With respect to the claim against the Attorney General, by reason of s. 32 of the Crown Liability and Proceedings Act, which, with certain exceptions, provides that the laws about limitation periods in force between subject and subject apply to any proceedings against the Crown, the applicable limitation period was the period provided by s. 7(1) of Ontario's Public Authorities Protection Act. The six-month limitation period in s. 7(1) of the Public Authorities Protection Act applied with respect to an act done in pursuance or execution or intended execution of any statutory or other public duty or authority. Here again there was an issue about the effect of NP's alleged malice and intention to injure and the respondents cited no authority to support the proposition that the Crown could not be vicariously liable. For present purposes, it was sufficient to note that there was ample authority that holds employers vicariously liable for the wrongful acts of their employees. The conduct of NP could be in the course of his employment but not "in performance of his duties" under the legislation, if those words are interpreted as requiring good faith. In summary, by reason of the allegation and evidence of malice and intention to injure, the application of the relevant limitation periods must await a trial.

APPEAL from a summary judgment dismissing an action.

Cases referred to Al's Steak House and Tavern Inc. v. Deloitte & Touche (1997), 1997 2339 (ON CA), 13 C.P.C. (4th) 90 (Ont. C.A.), affg (1994), 1994 7326 (ON SC), 20 O.R. (3d) 673 (Gen. Div.); Authorson (Litigation Guardian) v. Canada (Attorney General) (2002), 2002 23598 (ON CA), 58 O.R. (3d) 417, 215 D.L.R. (4th) 496, 92 C.R.R. (2d) 224 (C.A.), supp. reasons (2002), 2002 44976 (ON CA), 215 D.L.R. (4th) 544 (Ont. C.A.), affg (2000), 2000 22731 (ON SC), 53 O.R. (3d) 221, 84 C.R.R. (2d) 211 (S.C.J.); Boothman v. R., [page174] 1993 2949 (FC), [1993] 3 F.C. 381, 49 C.C.E.L. 109 (T.D.) (sub nom. Boothman v. Canada); British Columbia (Deputy Sheriff, Victoria) v. Canada (1992), 1992 4036 (BC CA), 90 D.L.R. (4th) 680, [1992] 4 W.W.R. 432 (B.C.C.A.); Domestic Converters Corp. v. Arctic Steamship Line, 1980 4242 (FCA), [1984] 1 F.C. 211, 46 N.R. 195 (C.A.); Dywidag Systems International Canada Ltd. v. Zutphen Brothers Construction Ltd., 1990 140 (SCC), [1990] 1 S.C.R. 705, 97 N.S.R. (2d) 181, 68 D.L.R. (4th) 147, 106 N.R. 11, 258 A.P.R. 181, 46 C.R.R. 259, 41 C.P.C. (2d) 18; Irwin Toy Ltd. v. Quebec (Attorney General), 1989 87 (SCC), [1989] 1 S.C.R. 927, 24 Q.A.C. 2, 58 D.L.R. (4th) 577, 94 N.R. 167, 39 C.R.R. 193, 25 C.P.R. (3d) 417; Levy Brothers Company Ltd. v. The Queen, 1961 58 (SCC), [1961] S.C.R. 189, affg 1959 322 (CA EXC), [1960] Ex. C.R. 61; Mart Steel Corp. v. The Queen, 1974 2544 (FC), [1974] 1 F.C. 45 (T.D.); Nelles v. Ontario, 1989 77 (SCC), [1989] 2 S.C.R. 170, 69 O.R. (2d) 448n, 35 O.A.C. 161, 60 D.L.R. (4th) 609, 98 N.R. 321, 49 C.C.L.T. 217, 37 C.P.C. (2d) 1, 71 C.R. (3d) 358; Patterson Estate v. Storry, [2002] 6 W.W.R. 183, 21 M.V.R. (4th) 107, 18 C.P.C. (5th) 124, 2002 ABQB 127, 1 Alta. L.R. (4th) 100 (Q.B.); Prete v. Ontario (1993), 1993 3386 (ON CA), 16 O.R. (3d) 161, 110 D.L.R. (4th) 94, 18 C.R.R. (2d) 291, 18 C.C.L.T. (2d) 54, 86 C.C.C. (3d) 442, 20 C.C.L.T. (3d) 319 (C.A.) [Leave to appeal to S.C.C. refused (1994), 20 C.R.R. (2d) 192n, 17 O.R. (3d) xvi, 20 C.C.L.T. (2d) 319n, 175 N.R. 322n], revg (1990), 47 C.R.R. 307 (Ont. H.C.J.); R. v. Edwards, 1996 255 (SCC), [1996] 1 S.C.R. 128, 26 O.R. (3d) 736n, 132 D.L.R. (4th) 31, 192 N.R. 81, 33 C.R.R. (2d) 226, 104 C.C.C. (3d) 136, 45 C.R. (4th) 307; R. v. Miller (Bertram S.) Ltd., 1986 7611 (FCA), [1986] 3 F.C. 291, 31 D.L.R. (4th) 210, 69 N.R. 1, 28 C.C.C. (3d) 263 (C.A.), revg 1985 5599 (FC), [1985] 1 F.C. 72, 18 D.L.R. (4th) 600, 15 C.R.R. 298 (T.D.) (sub nom. Miller (Bertram S.) Ltd. v. R.); Scaglione v. McLean (1998), 1998 14667 (ON SC), 38 O.R. (3d) 464 (Gen. Div.) Statutes referred to Canadian Bill of Rights, S.C. 1960, c. 44, ss. 1(a), 2 Canadian Charter of Rights and Freedoms, ss. 7, 8 Courts of Justice Act, R.S.O. 1990, c. C.43, s. 109 Crown Liability and Proceedings Act, R.S.C. 1985, c. C-50, ss. 3(a), (b), 10, 24(a), 32 [as am.] Customs Act, R.S.C. 1985, c. 1 (2nd Supp.), s. 106(1), 129 Excise Tax Act, R.S.C. 1985, c. E-15 Limitations Act, R.S.O. 1990, c. L.15, s. 45(1)(g) Public Authorities Protection Act, R.S.O. 1980, c. 406, s. 11(1) Public Authorities Protection Act, R.S.O. 1990, c. P.38, s. 7(1) Authorities referred to Atiyah, P.S., Vicarious Liability in the Law of Torts (London: Butterworths, 1967) Hogg, P.W., and P.J. Monahan, Liability of the Crown, 3rd ed. (Toronto: Carswell, 2000)

Steven J. Greenberg, for appellants. Jan Brongers and Marie Crowley, for respondents.

The judgment of the court was delivered by

[1] MORDEN J.A.: -- The three plaintiffs in this action appeal from a summary judgment granted by Jennings J. dismissing their action for damages for wrongful seizure and wrongful storage of aircraft on the ground that it is barred by s. 106(1) of the Customs Act, R.S.C. 1985, c. 1 (2nd Supp.), which reads: [page175]

106(1) No action or judicial proceeding shall be commenced against an officer for anything done in the performance of his duties under this or any other Act of Parliament or a person called on to assist an officer in the performance of such duties more than three months after the time when the cause of action or the subject-matter of the proceeding arose.

[2] The appellants submit that s. 106(1) has no application to the facts of this case or, at least, does not have the same application to the two respondents, Nelson Plamondon, a customs officer, and the Attorney General of Canada representing the Government of Canada. It is more convenient to state the issues raised by this appeal after I have set forth a brief statement of the basic facts alleged.

I Facts

[3] The personal plaintiff, Ron Williams, is in the business of buying and selling aircraft and aircraft parts and repairing aircraft. He operates the plaintiff 144096 Canada Ltd. as Capital City Helicopters. The plaintiff 144096 Canada Ltd. (USA) was incorporated in the State of Delaware. Mr. Williams is the president of both corporate plaintiffs.

[4] In October of 1995, 144096 Canada Ltd. brought five Cessna aircraft into Canada from the United States and landed them at the airport in Ottawa. Mr. Williams said that the purpose was to store these planes for the winter. He did not intend to import them "on a permanent basis". He obtained permission from the customs authorities to keep the planes in Canada "until January 1996".

[5] In January 1996, Mr. Williams had four of the planes flown out of Ottawa with the intention of taking them back to the United States. The weather turned bad and these aircraft returned to Smiths Falls, Ontario. By reason of mechanical difficulties, the fifth plane could not be moved from Ottawa.

[6] On April 13, 1996, Mr. Plamondon, on behalf of Canada Customs, seized the five planes and a helicopter owned by one of the corporate appellants on the basis that there had been a breach of the Customs Act. The appellants commenced a proceeding against the Minister of National Revenue under s. 129 of the Customs Act to challenge the seizure. This proceeding concluded with a decision of Blais J. of the Federal Court of Canada, Trial Division, dated August 31, 2000, in which he held that the Customs Act had not been breached. The Minister of National Revenue commenced an appeal from this decision but withdrew it on February 19, 2001.

[7] The helicopter was returned to Mr. Williams on June 26, 2001 and the five aircraft in August of 2001. The appellants allege that the aircraft while under seizure were improperly [page176] stored and accordingly were damaged such that they are no longer airworthy. They are "almost worthless".

[8] Mr. Plamondon also made a separate seizure. On May 1, 1996, he seized a Cessna 185 owned by the appellant 144096 Canada Ltd. and returned it on or about June 25, 1996.

II History of Proceeding

[9] The appellants commenced this action on May 22, 1998. They amended their statement of claim on April 5, 2001. The relief sought, as set forth in the amended statement of claim, includes the following claims:

(a) the sum of $500,000 for the negligent and/or wilful damage to the aircraft arising out of negligent and/or wilfully wrongful storage;

(b) the sum of $1,630,000 for the loss of use of the aircraft due to the negligent and/or wilful acts of the defendants and due to wrongful seizure and for falsely inflating the values of the aircraft in order to increase the penalties for breach of the provisions of the Customs Act and the Excise Tax Act, R.S.C. 1985, c. E-15;

(c) the sum of $250,000 for damage due to wrongful seizure of the Cessna 185 aircraft;

(d) the sum of $250,000 for damage to loss of shareholder value due to the above damage;

(e) the sum of $250,000 for punitive damages for wrongful seizure and heavy and highhanded conduct by the defendants.

In the following two sub-paragraphs in the amended statement of claim, the appellants allege that all of the relief claimed is based on breach of common law rights and rights under ss. 7 and 8 of the Canadian Charter of Rights and Freedoms. The only addition to the original prayer for relief in the amended statement of claim is set forth in para. (b) above.

[10] The first statement of defence was delivered on June 25, 1998 and the amended statement of defence, apparently, sometime in March of 2002. The plea of s. 106(1) of the Customs Act was first raised in the amendment to the statement of defence.

[11] The reasons of the motions judge endorsed on the record after the hearing read as follows:

Counsel agreed that if the motion to amend succeeded they wished to treat the amended statement of defence as delivered, and to argue the defendant's [page177] motion for summary judgment. With respect to the tort claims, there is no dispute that the seizures took place in 1996, and that this action was commenced in 1998. The defendant Plamondon is an officer as defined in s. 2(1) of the Customs Act. S. 106(1) of the Act requires that any proceeding be commenced against an officer within 3 months of when the cause of action arose. That was 1996. This action, brought 2 years later, is out of time as it relates to Plamondon.

The Crown's liability can only be vicarious by reason of the operation of s. 3(a) and s. 10 of the Crown Liability and Proceedings Act. Further, s. 24(a) of the C L and P Act gives the Crown the right to raise the limitation defence -- see Al's Steak House v. Deloitte Touche (1997), 1997 2339 (ON CA), 102 O.A.C. 144.

For both of these reasons the tort claims are statute-barred.

The claim (amended) in para 1(f) appears to raise a claim for damages for breach of ss. 7 and 8 of the Charter.

No facts are pleaded to support the claim.

Assuming the challenge is to the validity of s. 106 of the Customs Act, there has been no compliance with the mandatory provisions of s. 109 of the CJA.

Regardless, s. 7 of the Charter does not apply to the owners of the goods seized -- the corporate plaintiffs. See Ford Credit v. M.N.R. (1994), 1994 1782 (BC SC), 100 B.C.L.R. (2d) 162 at 173-4.

S. 8 is not engaged unless a privacy right is infringed. Nothing in the material raises a privacy expectation. In this situation, there can be no expectation of privacy in planes imported for leasing-out. Francoeur v. Canada, [1994] F.C.J. No. 695 (aff'd on appeal)

S. 8 has no application to a forfeiture order (Reg v. Harb (1994), 1994 NSCA 55, 88 C.C.C. (3d) 204) and in my opinion, to a seizure.

Accordingly there is nothing in the material to suggest a valid Charter damage claim.

Accordingly, under the provisions of Rule 20.04(2) and (4) summary judgment will issue dismissing the plaintiff's action. The defendants not asking for costs, none are awarded.

III Statutory Provisions

[12] I have set out s. 106(1) in the first paragraph of these reasons. Other statutory provisions which bear on this appeal are ss. 3(a) and (b), 10, 24(a) and 32 of the Crown Liability and Proceedings Act, R.S.C. 1985, c. C-50 and s. 7(1) of the Public Authorities Protection Act, R.S.O. 1990, c. P.38. These provisions read as follows:

Crown Liability and Proceedings Act

3. The Crown is liable in tort for the damages for which, if it were a private person of full age and capacity, it would be liable

(a) in respect of a tort committed by a servant of the Crown; or [page178]

(b) in respect of a breach of duty attaching to the ownership, occupation, possession or control of property. [See Note 1 at end of document]

10. No proceedings lie against the Crown by virtue of paragraph 3(a) in respect of any act or omission of a servant of the Crown unless the act or omission would apart from the provisions of this Act have given rise to a cause of action in tort against that servant or the servant's representative. [See Note 2 at end of document]

11. In any proceedings against the Crown, the Crown may raise

(a) any defence that would be available if the proceedings were a suit or an action in a competent court between subject and subject; [See Note 3 at end of document]

32. Except as otherwise provided in this Act or in any other Act of Parliament, the laws relating to prescription and the limitation of actions in force in a province between subject and subject apply to any proceedings by or against the Crown in respect of any cause of action arising in that province, and proceedings by or against the Crown in respect of a cause of action arising otherwise than in a province shall be taken within six years after the cause of action arose. [page179]

Public Authorities Protection Act

7(1) No action, prosecution or other proceeding lies or shall be instituted against any person for an act done in pursuance or execution or intended execution of any statutory or other public duty or authority, or in respect of any alleged neglect or default in the execution of any such duty or authority, unless it is commenced within six months next after the cause of action arose, or, in case of continuance of injury or damage, within six months after the ceasing thereof.

IV Issues

[13] The appellants' case was presented in fragmented form and the respondents' responses to it were somewhat selective. In what follows, I have followed a form of organization intended to cover all of the issues raised and those necessarily related to them.

[14] The basic issue in this appeal is whether the motions judge was right to dismiss the appellants' action on the ground that it was not commenced within the three-month limitation period provided in s. 106(1) of the Customs Act.

[15] In addition to pointing out that s. 106(1) by its terms applies only to Crown officers and not to the Crown, the appellants submit that there are additional reasons why it should be held to be inapplicable:

(i) With respect to the case against the Crown, the liability is direct under s. 3(b) of the Crown Liability and Proceedings Act. Accordingly, even if the vicarious liability of the Crown for the acts of Mr. Plamondon and other Crown employees would make s. 106(1) applicable (as to which no submissions were made by the appellants), s. 106(1) is not applicable because the Crown's liability is direct. The applicable limitation period would be the six years set forth in the concluding clause of s. 32 of the Crown Liability and Proceedings Act or, possibly, by virtue of the preceding part of the section, six years under Ontario law. I assume it is the six-year period provided for in s. 45(1)(g) of the Limitations Act, R.S.O. 1990, c. L.15.

(ii) Mr. Plamondon's acts respecting the appellants were motivated by malice and intent to damage the appellants.

(iii) By reason of ss. 1(a) and 2 of the Canadian Bill of Rights, S.C. 1960, c. 44, s. 106(1) is invalid.

(iv) The claims based on ss. 7 and 8 of the Charter are not subject to s. 106(1). [page180]

[16] There are other issues to be addressed in the appeal, some related to the foregoing, such as: (a) the validity of the respondents' position that the Crown, in addition to Mr. Plamondon, is entitled to the protection of s. 106(1) of the Customs Act; (b) if no federal limitation provision is available to the Crown, a determination of the applicable provincial provision; (c) whether the claim for wrongful storage, as opposed to wrongful seizure, is barred by the running of a limitation period; and (d), whether the respondents may rely upon the failure of the appellants to serve a notice under s. 109 of the Courts of Justice Act, R.S.O. 1990, c. C.43. I shall deal with these issues, where appropriate, in the reasons that follow.

V Analysis

1. Is the liability of the Crown direct under s. 3(b) of the Crown Liability and Proceedings Act and not vicarious under s. 3(a) of the Act?

[17] Section 3(b) is quoted above. It is difficult to see how, by its terms, it could have application to the claim based on wrongful seizure. I should say, at this point, that there is no necessary connection, in general or on the facts of this case, between a wrongful seizure of property and a subsequent wrongful treatment of the property. Separate acts are involved in each case. With this distinction in mind, it appears, according to the wording of s. 3(b), which includes "possession", that the Crown could be liable under this provision for damage to the aircraft while the aircraft were in the Crown's possession, assuming that the possession was that of the Crown and not of particular employees.

[18] However, I am inclined to think that the better view is that s. 3(b) is not applicable to this case. It is a provision that recognizes cases at common law where the duty of the defendant to the plaintiff is direct and not vicarious, as in occupier's liability cases. I refer to Hogg and Monahan, Liability of the Crown, 3rd ed. (Toronto: Carswell, 2000) at p. 130 which states that a statutory provision in identical terms to s. 3(b) "is for breach of occupier's duties". At pp. 130-31, the authors say:

What is covered here are the duties of care owed by an occupier of property to persons entering the property. Breach of these duties would provide an injured visitor with a cause of action against the occupier of the land, even if the immediate cause of the accident was the act or omission of an employee of the occupier. It will be recalled that it was the absence of any Crown liability under this head that defeated the plaintiffs in Adams v. Naylor, [[1946] A.C. 543 (H.L.)] and Royster v. Cavey, [[1947] 1 K.B. 204 (C.A.)], the two cases that finally drove the United Kingdom Parliament to abolish Crown immunity in tort. [page181]

[19] I note that the section has been applied in cases that are not occupier's liability cases: Mart Steel Corp. v. The Queen, 1974 2544 (FC), [1974] 1 F.C. 45 (T.D.) (claim based on nuisance) and Domestic Converters Corp. v. Arctic Steamship Line, 1980 4242 (FCA), [1984] 1 F.C. 211, 46 N.R. 195 (C.A.) (claim for damages to goods stored in shed owned by Crown which collapsed due to accumulation of snow on the roof). In each of these cases the duty of the Crown related directly to its ownership or control of property.

[20] I also refer to The Queen v. Levy Brothers Company Ltd., 1959 322 (CA EXC), [1960] Ex. C.R. 61, result affirmed 1961 58 (SCC), [1961] S.C.R. 189, where the Exchequer Court doubted that s. 3(b) was intended to apply to cases based on claims for injury to, or loss of, goods bailed to the Crown, assuming that the Crown is properly a bailee.

[21] The appellants' most specific argument in this part of the case is that the Crown was a trustee of the aircraft in its possession and, accordingly, responsible to the appellants for any damage resulting from a breach of that duty. This argument is based on the recent decision of this court in Authorson (Litigation Guardian) v. Canada (Attorney General) (2002), 2002 23598 (ON CA), 58 O.R. (3d) 417, 215 D.L.R. (4th) 496 (C.A.). In Authorson, the court dealt with the question whether the Crown owed fiduciary duties in the context of a legislative scheme for the administration of pension benefits for disabled veterans and held that the Crown owed fiduciary duties to these disabled veterans. In the present case, the appellants have not pleaded a trust or a fiduciary relationship, and have advanced no evidence on this subject nor referred to any law in support of their position, apart from Authorson, which is clearly distinguishable on its facts.

[22] Quite apart from the foregoing, one must consider on what date the limitation period began to run with respect to the claim for wrongful storage. It cannot be April 13, 1996, the day of the seizure of the five aircraft and the helicopter, because the storage only began on that date. The storage ended in June 2001 with respect to the helicopter and in August 2001 with respect to the aircraft. The allegation is that the damage occurred when the aircraft were in the respondents' possession. There is no evidence relating to when the damage ended. The action was commenced in May 1998. In these circumstances I do not think that a summary judgment can be granted based on the running of the limitation period in s. 106(1) of the Customs Act, assuming it to be applicable.

[23] In summary, under this heading, I have concluded that the claim for the seizure of the aircraft does not come within s. 3(b) and, with respect to the damage caused by the storage, it cannot be concluded at this stage of the litigation when the limitation period, whatever it be, began to run. If s. 3(b) is applicable to the [page182] claim based on storage, I observe, for the reasons given in para. 30 below, that the applicable limitation period would be six months as provided in s. 7(1) of the Public Authorities Protection Act, and not six years as submitted by the appellants.

2. Accepting that s. 106(1) of the Customs Act is applicable to the claims against Mr. Plamondon, what is the applicable limitation provision relating to the claims against the Crown?

[24] The respondents submit, and the motions judge held, that by virtue of s. 24(a) of the Crown Liability and Proceedings Act, the applicable limitation period respecting the claim against the Crown is also the period provided for in s. 106(1) of the Customs Act. The reasoning is as follows. Section 24(a) provides that "[i]n any proceedings against the Crown, the Crown may raise any defence that would be available if the proceedings were a suit or an action in a competent court between subject and subject." Because the "subject", Plamondon, has available to him the "defence" of s. 106(1), the Crown may also rely on s. 106(1).

[25] While as a matter of principle and policy it makes sense to me that the limitation period governing claims against an employee should also be applicable to the claim against the employer based on the employer's vicarious liability for the employee's tort, I am not sure that this is brought about by s. 24(a) of the Crown Liability and Proceedings Act. I say this because the subject of limitation periods governing proceedings against the Crown (as well as proceedings by the Crown) is comprehensively dealt with in s. 32 of the Act, set forth above, and while the pleading of a limitation period is often, in common parlance, referred to as pleading a defence, the word "defence" is capable of an interpretation that is confined to a substantive defence, such as a justification that defeats a claim: Black's Law Dictionary, 7th ed. (Minneapolis: West Group, 1999) at p. 430; Jowitt, The Dictionary of English Law (London: Sweet & Maxwell, 1959) at pp. 598-99; and Walker, The Oxford Companion to Law (Oxford and New York: Oxford University Press, 1980) at p. 346.

[26] In Al's Steak House & Tavern Inc. v. Deloitte & Touche (1997), 1997 2339 (ON CA), 13 C.P.C. (4th) 90 (Ont. C.A.), Rosenberg J.A. dealt with ss. 24(a) and 32, among other sections, of the Crown Liability and Proceedings Act. He gave as an example of a defence covered by s. 24(a) the common law defence of consent in a tort action based on assault. When it came to determining the applicable limitation period in that case, he applied s. 32, specifically, that part of it which made provincial law applicable, with the result [page183] that he held that s. 7(1) of the Public Authorities Protection Act was applicable to an action against the federal Crown. He did not hold that s. 7(1) of the Public Authorities Protection Act was made applicable through the application of s. 24(a). With respect, the motions judge erred in interpreting Al's Steak House as holding that s. 24(a) made s. 7(1) of the Public Authorities Protection Act applicable.

[27] The problem I have is indicated above. If s. 24(a) was intended to apply to a "defence" based on a limitation provision, then a large part of s. 32, which expressly provides for limitation periods, is unnecessary. This supports the view that Parliament did not intend to deal with limitations twice within a span of nine sections.

[28] In support of the submission that the respondent Crown may rely on s. 106(1) of the Customs Act through the operation of s. 24(a) of the Crown Liability and Proceedings Act, the respondents rely on Al's Steak House & Tavern Inc. v. Deloitte & Touche, supra, and Patterson Estate v. Storry, 2002 ABQB 127, [2002] 6 W.W.R. 183, 18 C.P.C. (5th) 124 (Alta. Q.B.). I have already observed that Al's Steak House relied upon s. 32 and not s. 24(a) in determining the applicable limitation provision. Patterson Estate v. Storry, and the cases cited in it, most notably Scaglione v. McLean (1998), 1998 14667 (ON SC), 38 O.R. (3d) 464 (Gen. Div.) which appears to be the first decision in a line of cases to the same effect, clearly do apply s. 24(a) in determining the applicable limitation period.

[29] I have stated my reservations respecting the application of s. 24(a), but by reason of the lack of argument on the question and the respect properly owed to decisions to the contrary, I do not express a final conclusion on the question. For the reasons that I shall give, if s. 106(1) of the Customs Act is not applicable, then s. 7(1) of the Public Authorities Protection Act, set forth above, clearly is applicable. On the evidence in this case nothing turns on which provision is applicable, even though s. 106(1) provides for a three-month limitation period and s. 7(1) a six-month period.

[30] In my view, by reason of s. 32 of the Crown Liability and Proceedings Act, s. 7(1) of the Public Authorities Protection Act applies to this case. This is clearly covered by Al's Steak House. I acknowledge that before us the Crown did not rely on s. 7(1) of the Public Protection Authorities Act. It relied exclusively on s. 106(1) of the Customs Act. It did, however, plead s. 7(1) of the Public Authorities Protection Act in its statement of defence and I do not see how we can ignore it. It takes precedence over any six-year limitation period provided for in Ontario law and the six-year limitation provision provided for in the concluding part of s. 32 can have no application because the causes of action in this case arose entirely in Ontario. [page184]

3. What is the effect of Mr. Plamondon's alleged malice and intention to injure on the application of s. 106(1) of the Customs Act?

[31] The appellants submit that the respondents are not entitled to rely upon s. 106(1) because Mr. Plamondon's seizure and storage of the aircraft in question was not "done in the performance of his duties under [the Customs Act] or any other Act of Parliament". Rather, the appellants submit that Mr. Plamondon's actions were motivated by malice and an intention to inflict damages on the appellants.

[32] The principal authority upon which the appellants rely is Al's Steak House & Tavern Inc. v. Deloitte & Touche, supra. At p. 108 C.P.C., Rosenberg J.A. said for the court:

The Crown has the protection of s. 7 of the Ontario Public Authorities Protection Act for the claims based upon malicious prosecution by the Crown agents only if the acts were done "in pursuance or execution or intended execution of any statutory or other public duty or authority."

[33] After referring to passages in Nelles v. Ontario, 1989 77 (SCC), [1989] 2 S.C.R. 170, 60 D.L.R. (4th) 609, Rosenberg J.A. then said at pp. 108-09 C.P.C.:

In my view, it is at least arguable that conduct motivated by malice is not within the scope of the duties of either a government investigator or a public prosecutor. If so, s. 7 may have no application.

As noted earlier, the plaintiff has pleaded malice on the part of both the Crown prosecutor and the National Revenue investigators. It would not be appropriate to strike out the statement of claim in relation to the claims of malicious prosecution at this stage of the proceedings.

[34] The respondents submit that this argument is not in law open to the appellants because the "broad wording" of s. 106(1) -- "anything done" by "an officer" "in the performance of his duties under this or any other Act of Parliament" -- covers the entire range of conduct for which the Crown, as employer of the customs officer, could be vicariously liable. My response to this submission is that there is substantially similar broad wording in s. 7(1) of the Public Authorities Protection Act, as considered in Al's Steak House, but the interpretation of acting outside the terms of the statute was recognized and applied in that case.

[35] The respondents then submit that if Mr. Plamondon was acting outside the scope of his duties, the action against the Crown would have to be dismissed because there could be no vicarious liability in the circumstances. They cite no authority for this. It is sufficient for present purposes to note that there is [page185] ample authority which holds employers vicariously liable for the wrongful acts (to use a general term) of their employees. The conduct of Mr. Plamondon could be "in the course of his employment" but not "in the performance of his duties under" the legislation, if these words are interpreted as requiring good faith performance. See The Queen v. Levy Brothers Company Ltd., 1961 58 (SCC), [1961] S.C.R. 189 at pp. 191-92; Boothman v. R., 1993 2949 (FC), [1993] 3 F.C. 381, 49 C.C.E.L. 109 (T.D.); Scaglione v. McLean, supra; and Atiyah, Vicarious Liability in the Law of Torts (London: Butterworths, 1967) at pp. 196-202. Because the particular facts of this case have yet to be found, this is not the occasion for making some of the fine distinctions found in the case law on the subject.

[36] The respondents also submit that the appellants have not properly pleaded this issue nor is there sufficient evidence bearing on it to defeat the motion for summary judgment. I shall deal with these points briefly.

[37] As far as the pleading is concerned, it would have been better if the appellants had delivered a reply in which they pleaded facts that showed that the limitation period defences were not available. The ground is, however, covered in paras. 34 and 36 of the amended statement of claim, which read:

34. The plaintiffs state and the fact is that Nelson Plamondon has intentionally or negligently inflicted damages and business losses to the plaintiffs by his heavy handed and high handed conduct and by the wrongful seizure of the aircraft in question.

35. The plaintiffs state and the fact is that Nelson Plamondon and the Crown in Right of Canada have negligently or deliberately cause[d] damage to the plaintiffs by the aforementioned acts or omissions.

[38] As far as the evidence is concerned, I think that there is sufficient evidence set forth in the affidavit of Mr. Williams. Some of it is as follows:

(a) "Nelson Plamondon lied to a Justice of the Peace in order to obtain a warrant for the search and seizure of the aircraft and the business premises of the corporate defendant, 144096 Canada Ltd." Particulars of the false information are set forth.

(b) "The defendants deliberately or negligently falsified the valuations of the aircraft in order to inflate the penalties associated with the breach of the Customs Act and the Excise Tax Act and in order to prevent the plaintiffs from paying any such penalties being much too high and therefore continuing the seizure for a lengthy period of time than would have otherwise occurred." [page186]

(c) "The Crown could have released the planes at any time but did not do so. It insisted on maintaining the seizure as security for the payment of forfeit. . . . There was no reason to keep the aircraft as security as the companies had been in business for approximately 30 years and are solvent."

(d) "Mr. Plamondon instructed the authorities at Smiths Falls Airport to continue the seizure of [the Cessna 185 aircraft] although he knew at the time that this aircraft was not one of the ones which he alleged breached Customs Regulations or the Customs Act. I brought this to his attention immediately upon hearing that the aircraft was under seizure. He seized it on the pretext of having to verify that it was lawfully imported into Canada. This could have been checked in a matter of minutes but he took almost two months to do this. All of the documentation was provided to him to prove that it was lawfully in Canada."

[39] The respondents did not deliver an affidavit of Mr. Plamondon in response to the allegations of malice that are set out in Mr. Williams' affidavit. This could be regarded as adding strength to the allegations and, at the very least, it is hardly an example of parties to a summary judgment motion putting their best foot forward. In their factum in this court the appellants stated as part of the facts that "[n]one of the allegations of fact that Mr. Plamondon committed malicious or negligent conduct nor that the Crown failed to store the aircraft properly are disputed in the material before the Court." There is no denial of this in the respondents' factum.

[40] In summary, by reason of the allegation and evidence of malice and intention to injure on the part of Mr. Plamondon, the application of the relevant limitation periods must await a trial.

4. The application of the Canadian Bill of Rights

[41] The appellants have submitted that s. 106(1) of the Customs Act is unconstitutional on the basis of ss. 1(a) and 2 of the Canadian Bill of Rights. In short, they submit that s. 106(1) should be construed so that it does not deprive them of their property rights. This point was not raised before the motions judge or in the appellants' pleading (which did raise the Charter issues with which I shall deal shortly). The appellants, once again, rely upon the decision of this court in Authorson v. Canada, supra, which applied the Canadian Bill of Rights to the legislation in question in that proceeding. The legislation in Authorson did involve a deprivation of property rights. This decision is [page187] distinguishable from the present case on the short ground that s. 106(1) merely provides for a limitation period and not for the deprivation of property rights. More directly, s. 1(a) of the Canadian Bill of Rights has no application to the claim of a corporation: British Columbia (Deputy Sheriff, Victoria) v. Canada, 1992 4036 (BC CA), [1992] 4 W.W.R. 432, 90 D.L.R. (4th) 680 (B.C.C.A.) and R. v. Miller (Bertram S.) Ltd. (1986), 1986 7611 (FCA), 31 D.L.R. (4th) 210, 28 C.C.C. (3d) 263 (F.C.A.). The seized aircraft are owned by the corporate plaintiffs. Accordingly, this ground of appeal must fail.

5. Canadian Charter of Rights and Freedoms, ss. 7 and 8

[42] The appellants submit that all of their claims are based not only on the common law, but also on ss. 7 and 8 of the Charter. The appellants submit that by reason of the decision of this court in Prete v. Ontario (1993), 1993 3386 (ON CA), 16 O.R. (3d) 161, 110 D.L.R. (4th) 94, which held that s. 11(1) of the Public Authorities Protection Act, R.S.O. 1980, c. 406 (now s. 7(1) of R.S.O. 1990, c. P.38) should be construed as not being applicable to claims under the Charter, s. 106(1) of the Customs Act should be interpreted in the same manner.

[43] I do not think that there is any genuine issue for trial respecting the claims under either sections 7 or 8 of the Charter.

[44] First, with respect to s. 7, assuming that by its terms it could apply to claims such as those asserted in this action, it has been held by the Supreme Court of Canada that s. 7 does not apply to a claim by a corporation: Irwin Toy Ltd. v. Quebec (Attorney General), 1989 87 (SCC), [1989] 1 S.C.R. 927, 58 D.L.R. (4th) 577, at p. 1004 S.C.R. and Dywidag Systems International Canada Ltd. v. Zutphen Brothers Construction Ltd., 1990 140 (SCC), [1990] 1 S.C.R. 705, 68 D.L.R. (4th) 147, at p. 709 S.C.R.

[45] Second, with respect to s. 8 of the Charter, the appellants by their citation of the Supreme Court of Canada decision in R. v. Edwards, 1996 255 (SCC), [1996] 1 S.C.R. 128, 132 D.L.R. (4th) 31, at pp. 145-46 S.C.R. and their submissions in their factum, accept that the court must address whether the appellants had a reasonable expectation of privacy with respect to the aircraft. They have not, however, identified any material in the record that would indicate that they had any reasonable expectation of privacy in the aircraft. This was the motions judge's conclusion and the appellants have not challenged this conclusion in their factum or in oral argument. Accordingly, this ground of appeal must also fail.

6. Section 109 of the Courts of Justice Act

[46] Stated briefly, this provision requires that a notice of a constitutional question be served on the Attorney General of [page188] Canada and the Attorney General of Ontario as a condition of a court being able to adjudge legislation to be invalid. The motions judge relied upon the appellants' failure to comply with this provision as one of the reasons for dismissing the action and the respondents, initially, relied upon it in response to the appeal. When the court brought to the attention of the respondents' counsel that the legislation in question was not liable to be adjudged invalid in the motion for summary judgment, no matter which way it was decided, they withdrew their argument based on s. 109.

VI Disposition

[47] In the result, I would allow the appeal, set aside the order of the motions judge except in so far as it dismissed the claims based on the Charter, and in its place I would grant an order dismissing the motion subject to the exception relating to the Charter claims. I would award to the appellants their costs of the motion and of the appeal on a partial indemnity basis. I would fix the costs of the motion at $7,000 for fees and disbursements, plus applicable GST and the costs of the appeal at $8,000 for fees and disbursements, plus applicable GST.

Order accordingly.

Notes

Note 1: By S.C. 2001, c. 4, s. 36, s. 3 was replaced by the following:

3. The Crown is liable for the damages for which, if it were a person, it would be liable

(a) in the Province of Quebec, in respect of

(i) the damage caused by the fault of a servant of the Crown, or

(ii) the damage resulting from the act of a thing in the custody of or owned by the Crown or by the fault of the Crown as custodian or owner; and

(b) in any other province, in respect of

(i) a tort committed by a servant of the Crown, or

(ii) a breach of duty attaching to the ownership, occupation, possession or control of property.

Note 2: By S.C. 2001, c. 4, s. 40, s. 10 was amended to provide:

10. No proceedings lie against the Crown by virtue of subparagraph 3(a)(i) or (b)(i) in respect of any act or omission of a servant of the Crown unless the act or omission would, apart from the provisions of this Act, have given rise to a cause of action for liability against that servant or the servant's personal representative or succession.

Note 3: By S.C. 2001, c. 4, s. 48, s. 24(a) was amended to provide:

24. In any proceedings against the Crown, the Crown may raise

(a) any defence that would be available if the proceedings were a suit or an action between persons in a competent court;