Québec (Communauté urbaine) v. Services de santé du Québec, [1992] 1 S.C.R. 426

Services de santé du Québec Appellant

v.

Communauté urbaine de Québec and

City of Sainte‑Foy Respondents

and

Bureau de révision de l'évaluation foncière

du Québec Mis en cause

Indexed as: Québec (Communauté urbaine) v. Services de santé du Québec

File No.: 21733.

1991: December 5; 1992: February 13.

Present: Lamer C.J. and La Forest, L'Heureux‑Dubé, Gonthier and Cory JJ.

on appeal from the court of appeal for quebec

Civil procedure ‑‑ Appeal ‑‑ Incidental appeal ‑‑ Appearance and declaration of incidental appeal filed with trial court office instead of Appeal Office ‑‑ Motion for special leave to file appearance and declaration with Appeal Office made to Court of Appeal two years after trial judgment ‑‑ Whether arts. 2 and 502 C.C.P. applicable ‑‑ If not, whether Court of Appeal could exercise its discretionary power under art. 523 C.C.P. to correct defect in inscription of incidental appeal ‑‑ Code of Civil Procedure, R.S.Q., c. C‑25, arts. 494, 499, 500, 502, 523.

In September 1987 the respondents appealed a judgment of the Provincial Court by filing an inscription in appeal, pursuant to art. 495 C.C.P., in the office of that court. A few days later, the appellant served on the respondents a document entitled "appearance and incidental appeal", which it also filed in the office of the Provincial Court. In August 1989 the appellant made a motion before the Court of Appeal for special leave to file its appearance and declaration of incidental appeal alleging, inter alia, that the office of the Provincial Court had failed to forward the appearance and declaration received in October 1987 to the office of the Court of Appeal. The majority of the Court of Appeal dismissed the motion. The court found that under arts. 499 and 500 C.C.P. the declaration of incidental appeal and the appearance should have been filed in the office of the Court of Appeal, not the trial court office. Since over six months had elapsed since the Provincial Court's judgment, the Court of Appeal concluded that it had no power by which it could extend the appeal deadline under art. 523 C.C.P.

In this Court the appellant argued principally that under the Code of Civil Procedure provisions applicable to incidental appeals, it was entitled to file its appearance and declaration of incidental appeal with the office of the Provincial Court and it was the duty of the clerk of that court to forward the proceeding to the office of the Court of Appeal. In the alternative, the appellant argued that, if an error was made, it was neither material nor jurisdictional, but purely procedural in nature. The Court of Appeal thus had the power under arts. 2, 502 and 523 C.C.P. to correct the irregularity.

Held: The appeal should be allowed.

The appearance and declaration of incidental appeal should have been filed with the office of the Court of Appeal. Although art. 500 C.C.P. does not say where an incidental appeal must be brought, art. 499 C.C.P. provides that an appearance on appeal must be filed at the "Appeal Office". It would be incongruous for the appearance and the declaration, which under art. 500 must be filed "at the same time", to be filed in two different places. The practice in Quebec has consistently been that the declaration of incidental appeal is filed at the Appeal Office. Simple logic requires that the appearance and the declaration be filed where the inscription in appeal and record are located. The appellant accordingly erred in filing its appearance and declaration with the trial court office. As the inscription in appeal was not "duly served and filed", art. 502 C.C.P. is not applicable here.

The Court of Appeal erred in interpreting art. 523 C.C.P. so as to deprive the appellant of its right of incidental appeal. That article confers on the Court of Appeal a broad discretionary power enabling it to "make any order necessary to safeguard the rights of the parties". Apart from the exceptions relating to arts. 494 and 198.1, this general rule must be given a broad and liberal interpretation. Since art. 500 C.C.P., which governs the bringing of an incidental appeal, is not within the exceptions provided for in art. 523, the Court of Appeal had the power to exercise its discretion to correct the procedural error made by the appellant, even though over six months had elapsed since the date of the Provincial Court judgment. Although an incidental appeal is an appeal, the rules applicable are not the same as those governing principal appeals. Unlike the time limits specified for a principal appeal in art. 494 C.C.P., the time limit for filing an incidental appeal is neither strict nor determinative of the right of appeal. Once the principal appeal has been filed within the time limits, the Court of Appeal's jurisdiction is preserved regardless of whether or not there is an incidental appeal.

In this case, there is no good reason not to exercise in the appellant's favour the discretion provided for in art. 523. It is clear that, without the exercise of this discretion, the appellant will be deprived of its right of appeal and will suffer detriment. On the other hand, the respondents cannot claim to have suffered any prejudice. The appearance and the declaration of incidental appeal were served on them within the prescribed time limit. They were immediately made aware of the appellant's intentions and arguments. It would thus be unfair to deprive a party of its right where it is possible to rectify the consequences of an error without injustice to the opposing party. Furthermore, the respondents are not arguing that this incidental appeal is frivolous.

Cases Cited

Referred to: Hamel v. Brunelle, [1975 1 (SCC)], [1977] 1 S.C.R. 147; Duquet v. Town of Sainte‑Agathe‑des‑Monts, [1976 13 (SCC)], [1977] 2 S.C.R. 1132; Bowen v. City of Montreal, [1978 14 (SCC)], [1979] 1 S.C.R. 511; Cité de Pont Viau v. Gauthier Mfg. Ltd., [1978 4 (SCC)], [1978] 2 S.C.R. 516; St‑Hilaire v. Bégin, [1981 21 (SCC)], [1981] 2 S.C.R. 79; Cégep André Laurendeau v. Adanox Ltée, [1982] C.A. 253; Microlab Inc. v. Dauphin, [1983] C.A. 269; Béland v. Scott, [1983 2776 (QC CA)], [1983] R.D.J. 456; Longmoor Building Co. (Quebec) Ltd. v. Main Plumbing & Heating Supplies Co., [1984 2869 (QC CA)], [1984] C.A. 82; Nelson International of Canada Ltd. v. Béton Provincial Ltée, [1984] C.A. 260; Saratoga Construction Ltée v. Horne, [1984 2819 (QC CA)], [1984] R.D.J. 352; Junk v. Schellwald, [1986 3689 (QC CA)], [1986] R.D.J. 608; Hansford v. Létourneau (1987), 5 Q.A.C. 193; Gersten v. Luxenberg, [1987 377 (QC CA)], [1987] R.J.Q. 533; Prévoyants du Canada, Assurance générale v. Marcotte, [1986 3877 (QC CA)], [1986] R.D.J. 137; Cousineau v. Le Bihan, [1967] Que. Q.B. 945; Emblem Investments Ltd. v. Moretti, [1969] Que. Q.B. 977; Frères des Écoles Chrétiennes de Montréal v. DuMesnil, [1973] C.A. 264; Ville de Villeneuve v. Drapeau, [1975] R.P. 309; Sauvé Construction Ltée v. Langsner‑Fuhrer Inc., [1976] R.P. 39; Société immobilière du Canada (Vieux‑Port de Québec) Inc. v. Éole II Inc., [1987 725 (QC CA)], [1987] R.D.J. 605.

Statutes and Regulations Cited

Code of Civil Procedure, R.S.Q., c. C‑25, arts. 2, 198.1 [ad. 1985, c. 29, s. 9], 494 [am. 1982, c. 32, s. 35; am. 1983, c. 28, s. 19; am. 1989, c. 41, s. 1], 495 [am. 1979, c. 37, s. 16], 498 [repl. idem, s. 19], 499 [repl. 1982, c. 32, s. 37; am 1989, c. 41, s. 2], 500 [repl. 1979, c. 37, s. 20], 502, 523 [am. 1985, c. 29, s. 11].

Code of Civil Procedure of the Province of Quebec (1897), art. 1248.

Authors Cited

Quebec. Legislative Assembly of Quebec. Bill 20: Code of Civil Procedure. Québec: Queen's Printer, 1965.

APPEAL from a judgment of the Quebec Court of Appeal*, dismissing the appellant's motion for special leave to file its appearance and declaration of incidental appeal. Appeal allowed.

Pierre Delisle, Q.C., and Jacques Flynn, Q.C., for the appellant.

Viateur Bergeron, Q.C., for the respondents.

//L'Heureux-Dubé//

The judgment of the Court was delivered by

L'Heureux‑Dubé J. -- In a case involving municipal evaluation, the Bureau de révision de l'évaluation foncière du Québec rendered a decision on April 29, 1986, in favour of the appellant, with respect to its complaints about the municipal assessment of immovable properties owned by the appellant in the city of Sainte‑Foy for the years 1981 to 1984 inclusive. The respondents appealed to the Provincial Court (now the Court of Quebec) which, on September 1, 1987 ([1988] R.J.Q. 184), allowed the appeal in part. On September 29, 1987, the respondents brought an appeal as of right to the Quebec Court of Appeal by filing an inscription in appeal in the office of the Provincial Court, pursuant to art. 495 of the Quebec Code of Civil Procedure, R.S.Q., c. C‑25. On October 5, 1987, within the time limits prescribed by art. 499 C.C.P., the appellant served on counsel for the respondents a document entitled [translation] "appearance and incidental appeal", which it also filed in the office of the Provincial Court.

On August 24, 1989, relying on arts. 2 and 502 C.C.P., the appellant made a motion before the Quebec Court of Appeal entitled [translation] "For special leave to file its `appearance and incidental appeal'", alleging inter alia that the office of the Provincial Court had failed to forward the "appearance and incidental appeal", received on October 5, 1987, to the office of the Quebec Court of Appeal. On October 27, 1989, the majority of the Quebec Court of Appeal dismissed the motion (Malouf J.A. dissenting), prompting the present appeal.

The only issue before this Court is the Quebec Court of Appeal's power to correct the situation created by the fact that the incidental appeal was filed in the office of the Provincial Court and not forwarded to the Quebec Court of Appeal within the time prescribed. In this regard art. 523 C.C.P. lies at the heart of the case:

523. The Court of Appeal may, if the ends of justice so require, permit a party to amend his written proceedings, to implead a person whose presence is necessary, or even, in exceptional circumstances, to adduce, in such manner as it directs, indispensable new evidence.

It has all the powers necessary for the exercise of its jurisdiction and may make any order necessary to safeguard the rights of the parties. It may even, notwithstanding the expiry of the delay allowed by article 494, but provided that more than six months have not elapsed since the judgment, grant special leave to appeal to a party who shows that in fact it was impossible for him to act sooner. However such leave cannot be granted in respect of a judgment rendered in the circumstances contemplated in article 198.1.

The appellant's main argument in support of its appeal is that, under the Code of Civil Procedure provisions applicable to incidental appeals, it was entitled to file its appearance and notice of incidental appeal with the office of the Provincial Court and it was the duty of the clerk of that court to forward the proceeding to the office of the Quebec Court of Appeal, which he neglected to do.

The Court of Appeal rejected this submission, the majority simply stating:

[translation] The respondent prepared a declaration of incidental appeal and an appearance and caused them to be served in time, but filed them in the office of the wrong court, namely that of the Provincial Court instead of the office of the Court of Appeal (arts. 499 and 500 C.C.P.).

The respondent is aware of all this, which is why it seeks to rely on arts. 2 and 502 C.C.P. These provisions allow for a broad application of the rules of procedure and art. 502 authorizes the correction of irregularities in the appeal procedure "provided, however, that the inscription in appeal has been duly served and filed". [Emphasis added.]

and Malouf J.A., dissenting:

[translation] There is no doubt that counsel for the respondent made an error in filing their appearance and incidental appeal with the office of the Court of Quebec instead of the office of the Court of Appeal.

In the alternative, the appellant argues that, if an error was made, it is neither material nor jurisdictional, but purely procedural in nature. Accordingly, by virtue of the discretion conferred on it by arts. 2, 502 and 523 C.C.P., the Court of Appeal had the power to correct the irregularity.

The majority of the Court of Appeal rejected this argument as well, as in its opinion:

[translation] In the case at bar, however, what is involved is not a procedural defect, a technicality, an irregularity in procedure but the loss of a substantive right, a bar, a prescription.

The right of appeal is a substantive right, an exceptional right which (except for a question of excess of jurisdiction by the Superior Court, which is not the case here, [1982 225 (SCC)], [1982] 1 S.C.R. 589, Goodman v. Rompkey et al.), exists only if specifically created by legislation and only to the extent provided therein, [1950 8 (SCC)], [1950] S.C.R. 412, at 428, Welch v. R. The time limit for exercising it, stipulated in the provision creating the right of appeal, is an integral part of it and so is a matter of substantive law and not procedure. The right of appeal, with a time limit for exercising it, has only a limited existence: if it is not exercised within the time prescribed, where the time limit is a strict one as in the case at bar (C.C.P. annotated, p. 574, Provencher v. Bélanger; [1986 3877 (QC CA)], [1986] R.D.J. 137, Les Prévoyants du Canada v. Marcotte), and the specific corrective provisions no longer apply, it is irremediably lost, expired, barred.

In the case at bar, as the declaration of an incidental appeal was filed with the office of the trial court instead of the office of the Court of Appeal, and was not forwarded to the Court of Appeal by the trial court clerk, the Court can only conclude that the incidental appeal is void and non‑existent and the respondent's right of appeal barred. As over six months have elapsed since the day of judgment, in view of the six‑month limit imposed in art. 523 C.C.P. the Court of Appeal has no power by which it can extend the appeal deadline in the case at bar.

That, moreover, is what this Court has already held for all practical purposes, in a similar case concerning an incidental appeal (the incidental appeal filed with the trial court office was forwarded to the Appeals Office, but belatedly), Hansford v. Létourneau, 5 Q.A.C. 193, at p. 197. Paré J.A., whose opinion was concurred in by his colleagues, concluded as follows:

"Finally, the question is not simply one of a procedural deadline, as suggested by the incidental appellant on the claim in warranty: it is a question of jurisdiction. It is the very existence of the right of appeal which is at issue and this court may not, outside the procedures specified in art. 523 C.C.P., ignore the expiry of the right of appeal."

Malouf J.A., for his part, expressed a contrary view:

[translation] The respondent acted diligently in bringing its incidental appeal before the time specified in the Code had expired. In the circumstances, the failure to file the said proceedings with the office of the Court of Appeal is due solely to an error by counsel for the respondent. Moreover, the staff in the Court of Quebec office, who knew or should have known that the case had been appealed, could have corrected this error by sending the said proceedings on to the Court of Appeal office. I do not really see how in such circumstances the respondent can be barred from arguing its case in this Court.

The main appeal is still before this Court. According to the respondent, both the main and the incidental appeal raise questions of significance. The appellants do not suggest that the incidental appeal is futile. They have submitted no motion to dismiss the incidental appeal.

I consider that in adopting the provisions of arts. 2, 502 and 523 the legislature intended to give this Court the power to correct such a situation. In my view, those provisions are for the purpose of correcting such a situation. It would be truly tragic to deny the respondent the opportunity of pleading its case.

According to the respondents, the majority of the Court of Appeal did not err as it followed a long line of jurisprudence of the Court of Appeal, on which the respondents rely along with the provisions of the Code of Civil Procedure.

Analysis

Before turning to the crux of this appeal, I think it is worth reviewing the guiding principles in this case.

The Code of Civil Procedure, R.S.Q., c. C‑25 (formerly S.Q. 1965, c. 80) came into force on September 1, 1966. It constituted a complete revision of the old Code and implemented the Report of the Commissioners responsible for drafting it, who explained at p. IVa of the annotated text of Bill 20: Code of Civil Procedure (1965):

The complaint most often raised against the Code is its excessive formalism and the complexity of the rules it sets out. Of course no one can deny that certain formalities are necessary in order to avoid leaving the administration of justice to the whim of pleaders or to the arbitrary ruling of the judge, to ensure a frank discussion of the issues in dispute, without the danger of being taken by surprise by one's adversary. But these formalities must be reduced to those necessary for achieving the purposes which are their justification. Otherwise they may even jeopardize the very rights which procedure is designed to safeguard, and risk making the road to justice a veritable labyrinth. But this is just what one complains about in the present Code, which still bears the stamp of an era when procedure was not yet sufficiently considered in its true role of the servant of the substantive law.

Article 2 C.C.P. expressly states in this regard:

2. The rules of procedure in this Code are intended to render effective the substantive law and to ensure that it is carried out; and failing a provision to the contrary, failure to observe the rules which are not of public order can only affect a proceeding if the defect has not been remedied when it was possible to do so. The provisions of this Code must be interpreted the one by the other, and, so far as possible, in such a way as to facilitate rather than to delay or to end prematurely the normal advancement of cases.

The Commissioners noted in commentary relating to art. 2 above (at p. 1a):

This text sets forth expressly the manner in which the rules of the new Code are to be applied and interpreted. This provision, which is in conformity with the spirit of the reform, will assist, in the opinion of the Commissioners, in giving to procedure the new orientation which is desired.

This Court has had the opportunity to put the remedial philosophy of this new Code into practice on several occasions, in particular per Pigeon J. in Hamel v. Brunelle, [1975 1 (SCC)], [1977] 1 S.C.R. 147, at pp. 153‑54. Similarly, in Duquet v. Town of Sainte‑Agathe‑des‑Monts, [1976 13 (SCC)], [1977] 2 S.C.R. 1132, he wrote at p. 1140:

In fact, the governing intention behind the whole new Code was the desire to bury the old adage that "form takes precedence over substance". This intention is stated expressly in art. 2 . . . .

And at pp. 1141‑42:

As I have already had occasion to note, when the decision on a question of form causes a litigant to be deprived of a substantial right, the matter ceases to be a question of form and becomes a question of law (see Barrette v. The Queen, [1976 180 (SCC)], [1977] 2 S.C.R. 121). For this reason, this Court has not hesitated to intervene on procedural questions in such circumstances, as in Frank v. Alpert, Basarsky v. Quinlan, Ladouceur v. Howarth, Witco Chemical Co. v. Oakville, General Foods v. Struthers, Hamel v. Brunelle. [References omitted.]

In Bowen v. City of Montreal, [1978 14 (SCC)], [1979] 1 S.C.R. 511, Pigeon J. reiterated that a liberal approach must be taken when interpreting the 1965 Code as follows, at p. 519:

On the other hand, this Court cannot endorse the formalistic attitude of the Court of Appeal. This would be contrary to a fundamental principle that is at the root of s. 50 of the Supreme Court Act and of the reform of civil procedure effected by the 1965 Code, and which has been sanctioned in numerous decisions, the most recent being Cité de Pont Viau v. Gauthier Mfg. Ltd. This principle is that a party must not be deprived of his rights on account of an error of counsel where it is possible to rectify the consequences of such error without injustice to the opposing party. In the circumstances, it appears to me that appellant should be allowed to take the necessary steps to obtain a decision on his conclusions for the annulment of the expropriation, on which the courts below did not rule.

This having been said, it is clear that, barring undue formalism, the peremptory provisions of the Code of Civil Procedure must be observed, as procedure judiciously applied provides an additional guarantee that the rights of litigants will be respected. This is especially true in the context of an appeal because, as the majority of the Court of Appeal pointed out, the right of appeal is a statutory creation, the very existence of which is subject to precise rules. This is what Pratte J. held in Cité de Pont Viau v. Gauthier Mfg. Ltd., [1978 4 (SCC)], [1978] 2 S.C.R. 516, upholding the Court of Appeal on this point, when he wrote at p. 519:

As regards the motion for the dismissal of the appeal, it had to be allowed. An appeal is brought only if, within the time limit provided for in art. 494 C.C.P., the inscription is filed with the office of the court of first instance and served upon the opposing party or his counsel. In the case at bar, though the inscription was filed with the office of the Superior Court, it was never served upon respondent or its counsel. One of the two steps essential to the bringing of the appeal was therefore missing; this is not a mere formality that the Court of Appeal could allow to be corrected (art. 502 C.C.P.). The Court of Appeal was therefore right to allow respondent's motion for the dismissal of the appeal brought by appellant. [Emphasis in original.]

The whole question here, then, is whether, in the case at bar, the Court of Appeal could exercise its discretionary power to correct the shortcoming in the inscription of the incidental appeal, or whether it was bound by the peremptory provisions dealing with appeals at art. 523 C.C.P.

Accordingly, this Court must consider both the principal and alternative arguments put forward by the appellant in this respect.

1. Filing of the Incidental Appeal

In the appellant's submission, since art. 500 C.C.P. does not say where an incidental appeal must be brought, the rule set out in art. 495 C.C.P. regarding the filing of the principal appeal applies.

Article 495 C.C.P. states:

495. The appeal is brought by depositing at the office of the court of first instance, within the delay provided by article 494, a duplicate and two copies of an inscription which has been served upon the adverse party or his attorney.

Article 500 C.C.P., for its part, provides:

500. Without prejudice to his right to bring an appeal himself in the manner and within the delay provided by articles 494 and 495, the respondent may make an incidental appeal, without formality other than a declaration, served on the adverse party and filed at the same time as his written appearance, that he will demand the reversal, in his favour, of the judgment appealed from. Such declaration must set out the conclusions sought by the respondent and a summary statement of the means he intends to set up.

Article 499 C.C.P., however, states that the appearance on appeal must be filed at the Appeal Office. If, as the appellant claims, an incidental appeal must abide by the same filing rules as the principal appeal in the absence of a more specific provision in art. 500, then why are the rules for appearances different for each -‑ particularly when art. 500 follows immediately after art. 499 and both articles deal with appearances?

Moreover, it would be incongruous, to say the least, if the appearance and incidental appeal, which, under art. 500 C.C.P., are to be filed at the same time, were required to be filed in two different places which, depending on the judicial district, may be a considerable distance apart. In my view, an interpretation that leads to such a result is untenable. It should further be noted that, in this case, the appearance and the incidental appeal constituted one document, so it can be assumed that the appellant itself took for granted that the two procedures had to be filed in the same office.

Finally, the practice in Quebec has consistently been that the incidental appeal is filed at the Appeal Office. Simple logic requires this under art. 498 C.C.P.:

498. As soon as the inscription in appeal is filed, the prothonotary must transmit a copy to the Appeal Office at Québec or Montréal, as the case may be, and a copy to the judge whose judgment is appealed from. He must also, without delay, prepare and certify, in the manner prescribed by the rules of practice of the Court of Appeal, the record of the case, a list of the documents therein and a copy of the entries made in the registers, to be transmitted to the Appeal Office as soon as possible.

It would seem illogical for the appearance and the incidental appeal to be filed anywhere but where the inscription in appeal and record are located. Additionally, in contrast to provisions governing the principal appeal, there is nothing in art. 498 C.C.P. that requires the prothonotary to forward the appearance and incidental appeal to the Appeal Office as soon as they are filed. He could of course have done so, but given the provisions of the Code of Civil Procedure, his failure could not serve to remedy the problem which the appellant now faces.

The principal appellant's obligation to inscribe its appeal with the office of the court of first instance is logical, since that is where the case record is at that time. That is not necessarily so, however, by the time the appearance and incidental appeal are filed. The contrary is more likely, and the current practice has developed accordingly.

In my opinion, the lack of formalism governing the incidental appeal since the 1965 Code should not be used to argue that, absent a clear provision, an established practice which is far from being in conflict with the new provisions should be overturned. The Commissioners' stated reasons for the suggested amendments have nothing to do with the appellant's arguments on this subject:

However, Article 500 provides that respondent may take an incidental appeal without other formality than a simple declaration filed at the same as his appearance, which will have the consequence of avoiding the numerous appeals made at the last moment to prevent counter‑appeals.

(Bill 20: Code of Civil Procedure, at p. 99a.)

In any event, the argument advanced by the appellant based on art. 494 C.C.P. does not, I think, stand up to scrutiny. The relevant passages of the article read:

494. An application for leave to appeal . . . must be presented by motion accompanied by a copy of the judgment and of the documents of the contestation, if they are not reproduced in the judgment. It must indicate the duration of the proof and hearing in first instance, the conclusions sought by the appellant and a summary statement of the grounds which the appellant intends to set up.

The motion must be served on the adverse party and filed with the office of the court within thirty days of the date of judgment; it must be presented to a judge of the Court of Appeal as soon as possible.

Every other appeal must be brought within 30 days of the date of judgment unless . . . a shorter delay is prescribed in another Act.

Such delays are peremptory and their expiry extinguishes the right of appeal; they run against the Crown and all persons, even incapables or absentees, when those who represent them or who must assist them have been duly impleaded. [Emphasis added.]

The words "every other appeal", which the appellant maintains apply to incidental appeals, seem to me to refer instead to the principal appeal when it is brought as of right (not subject to prior leave) or to the counter‑appeal (mentioned in art. 500 C.C.P.). An interpretation to the effect that the incidental appeal is included in this term would render art. 500 pointless, since it fixes a ten‑day time limit (the appearance time limit mentioned in art. 499) for bringing the incidental appeal, and not the thirty‑day time limit provided for in art. 494 C.C.P.

For all these reasons, I am of the view that the incidental appeal was wrongly filed with the trial court office. Accordingly, the appellant's main ground cannot succeed.

2. Article 502 C.C.P.

The appellant relies on arts. 2 C.C.P. (cited above) and 502 C.C.P. The latter reads as follows:

502. At any stage of the case, the court or, between sessions, one of its judges, may permit the correction, within such delay and under such conditions as it or he may determine, of any irregularity whatever in the procedure of appeal, provided, however, that the inscription in appeal has been duly served and filed. [Emphasis added.]

Had the appellant succeeded on its main argument, art. 502 C.C.P. might have been of assistance. As that argument has been rejected, it follows that the inscription in appeal was not "duly served and filed". Consequently, art. 502 C.C.P. does not apply.

3. Article 523 C.C.P.

Much ink has been spilt with respect to this provision and it has prompted a number of judgments both in the Court of Appeal and in this Court (see, for example, Hamel v. Brunelle, supra; Cité de Pont Viau, supra; St‑Hilaire v. Bégin, [1981 21 (SCC)], [1981] 2 S.C.R. 79; Cégep André Laurendeau v. Adanox Ltée, [1982] C.A. 253; Microlab Inc. v. Dauphin, [1983] C.A. 269; Béland v. Scott, [1983 2776 (QC CA)], [1983] R.D.J. 456 (C.A.); Longmoor Building Co. (Quebec) Ltd. v. Main Plumbing & Heating Supplies Co., [1984 2869 (QC CA)], [1984] C.A. 82; Nelson International of Canada Ltd. v. Béton Provincial Ltée, [1984] C.A. 260; Saratoga Construction Ltée v. Horne, [1984 2819 (QC CA)], [1984] R.D.J. 352 (C.A.); Junk v. Schellwald, [1986 3689 (QC CA)], [1986] R.D.J. 608 (C.A.); Hansford v. Létourneau (1987), 5 Q.A.C. 193; Gersten v. Luxenberg, [1987 377 (QC CA)], [1987] R.J.Q. 533 (C.A.)). From these cases it appears that, in general, the Court of Appeal has tended to adopt a strict interpretation while this Court has preferred a contrary approach.

Since art. 523 C.C.P. is at the heart of this appeal, it is worthwhile to trace its origins.

The former rule required strict and rigorous observance of the thirty‑day time limit for inscriptions in appeal. Article 1248 of the Code of Civil Procedure of the Province of Quebec (1897), replaced in the new Code by art. 523 C.C.P., did not allow for any exceptions since it listed the only cases in which the Court of Appeal could intervene:

1248. The court sitting in appeal may exercise all the powers necessary for such jurisdiction, and make such orders as it may deem proper for the purpose of remedying any insufficiencies of the record, of staying proceedings in the court of first instance in cases appealed from, of regulating the putting in or renewal of security, and of providing for all cases in which the law affords the party no special remedy.

This led Montgomery J.A. to write (Cité de Pont Viau v. Gauthier Mfg. Ltd., C.A. Montréal, No. 500‑09‑000260‑760, May 27, 1976, not reported but cited by Pratte J. in Cité de Pont Viau, supra, at p. 527):

. . . a successful litigant has the right to regard the judgment in his favour as final if no inscription in appeal is served upon him within thirty days.

Before the 1965 Code came into effect, this was the philosophy underlying the inflexibility of the thirty‑day time limit.

In adopting the new art. 523, the Commissioners sought to mitigate the harshness of the rule, as they themselves noted:

3. The Commissioners propose the maintaining of the delay of thirty days for inscription in appeal, but Article 523 of the draft gives to the Court the power during a period of six months, to grant special permission to appeal to the party who shows that in fact, it was impossible for him to act within the delay provided. This special rule is the same as that set out by Article 484 for the petition in revocation. This same Article 523 grants, moreover, to the Court of Appeal, in a general way, powers similar to those possessed by the Supreme Court, which is only proper, as the judges of the Supreme Court have themselves pointed out.

(Bill 20: Code of Civil Procedure, at p. 99a.)

This Court has since had the occasion to interpret art. 523 C.C.P. several times. In Hamel v. Brunelle, supra, Pigeon J., commenting on art. 523 C.C.P. in connection with a motion to amend dismissed by the Quebec Court of Appeal, observed at pp. 153‑54:

In my opinion, it is important to intervene to ensure compliance with the intention of the Quebec legislator to repeal the old maxim that "form takes precedence over substance". To cite only recent decisions, the rejection of unjust formalism was the reason for this Court's intervention on questions of procedure in: Frank v. Alpert, [1970 198 (SCC)], [1971] S.C.R. 637, 17 D.L.R. (3d) 491; Basdarsky v. Quinlan, [1971 5 (SCC)], [1972] S.C.R. 380, 24 D.L.R. (3d) 720; Ladouceur v. Howarth, [1973 30 (SCC)], [1974] S.C.R. 1111, 41 D.L.R. (3d) 416; Witco Chemical Co. v. Oakville, [1974 7 (SCC)], [1975] 1 S.C.R. 273, 43 D.L.R. (3d) 413. When a decision on a question of form results in a litigant losing his rights, it ceases to be a question of form and becomes a question of law. It is a question of form only as long as a remedy is possible, not when a right is lost. For this reason, in the case at bar, the point cannot be treated as a mere question of procedure.

Returning to the same theme in Duquet, supra, the same judge made similar observations in the passage I have already cited.

In Cité de Pont Viau, supra, Pratte J. posed the following question at p. 522:

The issue in the case at bar is therefore whether the Court of Appeal interpreted art. 523 C.C.P. correctly when it held that counsel's error had not made it impossible for appellant to act.

Is such an interpretation of art. 523 C.C.P. justified? This is the question that should now be considered.

Article 523 C.C.P. is new law.

His reply reflected the spirit of the new Code (at pp. 527-28):

Article 523 C.C.P. specifically empowers the Court under special circumstances to grant special leave to appeal within six months of the judgment. It is therefore only after this six‑month period has elapsed that a Superior Court judgment acquires the same force of res judicata that it had under the old Code after thirty days.

I am therefore of opinion that appellant has shown that "in fact, it was impossible for him to act sooner".

Accordingly, this Court has allowed a party who has lost its right of appeal because of a lawyer's mistake, the right to either amend its pleadings or file its appeal within six months of the contested judgment. In so doing, the Court has broadened the concept of "impossibility" of action. It has also indicated that the discretion conferred on the Court of Appeal by art. 523 C.C.P. should be exercised so as to safeguard the parties' rights, unless the error or omission of the applicant or his counsel had irreparable consequences for other parties in a case. In the most recent judgment of this Court on the scope of art. 523 C.C.P., St‑Hilaire v. Bégin, supra, which involved a motion to file an appeal outside the time limit where counsel for the applicant had been prevented from complying with art. 494 because the record had been transferred from the Superior Court to another office, Lamer J. (as he then was) concluded at pp. 87‑88:

In exercising its discretion, [the Court of Appeal] must in general, as art. 523 provides, seek "to safeguard the rights of the parties". As we have a system in which the parties are adversaries, and their respective rights are more often than not in conflict with each other, it goes without saying that the Court will have to give priority to the rights of some as against, and often to the detriment of, the rights of others. In this regard, the Court must base itself on the initial wording of art. 523 and, when it has a choice, choose the means of safeguarding the rights of the parties which are required by "the ends of justice".

Relying on Cité de Pont Viau, the Quebec Court of Appeal has for its part allowed motions under art. 523 for extensions of time to file notices of a principal appeal (see, for example, Microlab Inc. v. Dauphin, supra).

However, in Prévoyants du Canada, Assurance générale v. Marcotte, [1986 3877 (QC CA)], [1986] R.D.J. 137, Monet J.A., for the Court of Appeal, allowed a motion to dismiss an incidental appeal on grounds of lateness. At pages 137‑38 he wrote:

[translation] An incidental appeal is an appeal.

The right of appeal is conferred by legislation. Exercise of the right of appeal is subject to various conditions imposed by law. Certain conditions are strict. The time limit for appealing, both under the present Code and its predecessor, is an absolute one.

In either case, the appeal document must contain the conclusions sought and a brief statement of the grounds that the appellant expects to rely on. Essentially, the difference between an appeal under art. 494 C.C.P. and an appeal under art. 500 C.C.P. is further time. Nevertheless, in either case the time limits are strict.

Similarly, in Hansford v. Létourneau, supra, the Court of Appeal held that an incidental appeal could not be filed after the six‑month time limit specified in art. 523 C.C.P., as the court lacked jurisdiction. According to Paré J.A., at p. 197:

[translation] Finally, the question is not simply one of a procedural deadline, as suggested by the incidental appellant on the claim in warranty: it is a question of jurisdiction. It is the very existence of the right of appeal which is at issue and this court may not, disregarding the procedures specified in art. 523 C.C.P., ignore the expiry of the right of appeal.

This is the context in which we must decide whether, in the case at bar, the Court of Appeal was right in interpreting art. 523 C.C.P. so as to deprive the appellant of its right of incidental appeal.

First of all, it is important to stress the discretion conferred on the Court of Appeal by art. 523 C.C.P., a discretion broad enough to "make any order necessary to safeguard the rights of the parties". That is the general rule. Article 523 provides for only two exceptions: one relating to art. 494 C.C.P. and the other to art. 198.1 C.C.P.

Given this, it follows that the general rule must be given a broad and liberal interpretation and the exception, on the other hand, must be strictly interpreted.

As can be seen from the outset, art. 523 C.C.P. does not refer to art. 500 C.C.P. On this basis, it is tempting to conclude at once that the general discretionary rule should apply.

In my opinion, a closer analysis confirms this first impression.

To conclude, as the respondents do, that art. 523 C.C.P. prohibits any extension of the incidental appeal time limit beyond six months from the date of the judgment, the incidental appeal must be treated like the principal appeal, both in jurisdictional and material terms.

The argument starts from the principle that the incidental appeal is an appeal in itself. No one denies this, and it has in fact been affirmed by the Court of Appeal on several occasions (Cousineau v. Le Bihan, [1967] Que. Q.B. 945; Emblem Investments Ltd. v. Moretti, [1969] Que. Q.B. 977; Frères des Écoles Chrétiennes de Montréal v. DuMesnil, [1973] C.A. 264; Ville de Villeneuve v. Drapeau, [1975] R.P. 309; Sauvé Construction Ltée v. Langsner‑Fuhrer Inc., [1976] R.P. 39; Prévoyants du Canada, Assurance générale, supra; Société immobilière du Canada (Vieux Port de Québec) Inc. v. Éole II Inc., [1987 725 (QC CA)], [1987] R.D.J. 605) as well as by the majority of the Court of Appeal in this case.

However, in my view, the fact that the incidental appeal is a true appeal, an appeal in itself according to the terminology used by the courts, and an appeal which continues to exist in the event that the main appeal is abandoned, does not lead inexorably to the conclusion that a strict time limit governs an incidental appeal, as it does a principal appeal.

In arriving at its conclusion, the Court of Appeal characterized the right of incidental appeal as a substantive right and held that the time limit for exercising it [translation] "is an integral part of it and so is a matter of substantive law and not procedure". I do not share this view.

Article 494 C.C.P. deals only with the principal appeal and the counter‑appeal. Nowhere is there any mention of the incidental appeal, which is governed solely by art. 500 C.C.P.

While the time limits set out in art. 494 C.C.P. "are peremptory and their expiry extinguishes the right of appeal", there is no such provision in art. 500 C.C.P. The latter cannot be "a shorter delay", as mentioned by art. 494, because it does not meet the other condition of being "prescribed in another Act".

A principal appeal brought within the time limits provided for in art. 494 C.C.P. confers jurisdiction on the Court of Appeal; conversely, unless the time limit is extended under the second paragraph of art. 523, the Court of Appeal loses its jurisdiction when the time limit has expired. But, once the Court of Appeal acquires its jurisdiction, regardless of whether or not there is an incidental appeal, it keeps it. How then can we speak of a substantive, jurisdictional right in the case of an incidental appeal? If there is no principal appeal, then no incidental appeal is possible, and if the incidental appeal continues to exist once the main appeal has been abandoned, this is only because of the jurisdiction initially conferred by the principal appeal. Otherwise, a party who could have brought a counter‑appeal within the time limits, thereby conferring jurisdiction on the appellate court, would be deprived of a remedy merely because it chose instead to use the procedure of an incidental appeal.

It seems to me that, for these reasons, the legislature never intended to treat the incidental appeal and the principal appeal in the same way and indeed had no reason to do so. Once the principal appeal has been filed within the time limits, the Court of Appeal's jurisdiction is preserved in respect of and against everyone, incidental appellants as well as interveners. As the procedure in art. 500 C.C.P. does not fall within either of the two exceptions mentioned in art. 523 and neither logic nor the philosophy underlying the appeal system requires it, there is no need to add to the wording of art. 500 or art. 523, which is to be given a broad, liberal and non‑formalistic interpretation.

I therefore conclude that the appellant's alternative argument should succeed.

As the time limit for filing an incidental appeal was neither strict nor determinative of the right of appeal, and art. 500 C.C.P. is not within the exceptions provided for in art. 523, the Court of Appeal had the power to exercise the discretion conferred on it by art. 523 C.C.P. to "make any order necessary to safeguard the rights of the parties".

4. Exercise of the Discretion Provided for in [Art. 523](https://www.canlii.org/en/qc/laws/stat/cqlr-c-c-25/latest/cqlr-c-c-25.html) [C.C.P.](https://www.canlii.org/en/qc/laws/stat/cqlr-c-c-25/latest/cqlr-c-c-25.html)

Since it had the power to do so, should the Court of Appeal have exercised this discretion in the appellant's favour in the circumstances of this appeal?

In Hamel, supra, at p. 156, Pigeon J. discussed discretionary powers, precisely that provided for in art. 523 C.C.P.:

In my opinion, when all the provisions of the new Code of Civil Procedure regarding amendments are read together, it becomes clear that the legislator's real intention was, as the Commissioners suggested, that in appeal as at trial, all amendments needed in order to rule on the dispute objectively should be allowed; in other words, that procedure be the servant of justice not its mistress. It is true that this is a discretionary power, but it must not be overlooked that this is a judicial discretion. Consequently, the Court is under a duty to exercise it and it is in effect to refuse to exercise it than to do so [sic] on grounds unfounded in law (Smith & Rhuland Ltd. v. The Queen). Moreover, even under the former Code of Civil Procedure, it was well established that necessary amendments were not to be denied without good reasons. [Emphasis added.]

Like Pigeon J. in the foregoing case, who found no good reason for denying the amendment, Pratte J. in Cité de Pont Viau, supra, lists certain criteria favourable to the exercise of the discretion provided for in art. 523 C.C.P., at p. 528:

I am also of opinion that in the circumstances of the case at bar there are grounds for granting appellant the special leave to appeal that is being sought. No fault or negligence is alleged against appellant; the motion for leave was filed with dispatch; respondent does not contend that the appeal is futile; the case that was inscribed and decided at the same time as this one has been appealed. I have no hesitation in saying that this is definitely a case where the discretion provided for in art. 523 C.C.P. should be exercised in favour of the foreclosed party.

Applying these guidelines to the case at bar it is clear that, without the exercise of this discretion, the appellant will be deprived of its right of appeal, an obviously detrimental result. On the other hand, the respondents cannot claim to have suffered any prejudice. The appearance and the notice of incidental appeal were served on them within the prescribed time limit. They were immediately made aware of the appellant's intentions and arguments, and, therefore, did not in fact suffer any prejudice from the filing of this notice at one place rather than at another. In fact, the respondents were never aware of this discrepancy in the record or, at least, took no action to dismiss the incidental appeal. It is the appellant which took steps to rectify the situation.

As was the case in Bowen, supra, it would be unfair to deprive a party of its right "where it is possible to rectify the consequences of such error without injustice to the opposing party" (p. 519). Likewise, as in Cité de Pont Viau, supra, the respondents are not arguing that this incidental appeal is frivolous. Finally, the conclusion of Lamer J. in St‑Hilaire, supra, at p. 88, seems to me apposite is the case at bar:

In the case at bar, the opposing party suffered no loss. It received the copy of the pleadings on May 20; it even filed an appearance on appeal and undertook discussion with its opponents in preparation of the case on appeal. I do not consider that the fact that the filing was in the record rather than in the registry could in any way prejudice respondent; however, it has drastic consequences for appellants.

In my view, and as Malouf J.A. properly pointed out, there is no reason in this case not to exercise in the appellant's favour the discretion provided for in art. 523 C.C.P. As the Court of Appeal did not exercise it, this Court must make the decision the Court of Appeal should have made in this regard.

I would accordingly allow the appeal, reverse the judgment of the Court of Appeal and grant the appellant special leave to file with the Quebec Appeals Office, district of Québec, its appearance and notice of incidental appeal within ten days of the date of this judgment.

The costs of this appeal and of the appellant's motion in the Court of Appeal will be borne by the appellant.

Appeal allowed.

Solicitors for the appellant: Pothier, Bégin & Associés, Ste‑Foy.

Solicitors for the respondents: Alain, Tardif & Associés, Québec.

*C.A. Québec, No. [1989 1117 (QC CA)], 200-09-000569-878, October 27, 1989 (Bernier, Malouf and Rothman JJ.A.).