SUPERIOR COURT OF JUSTICE - ONTARIO
COURT FILE NO.: 23/10A (Guelph)
DATE: 20130531
RE: CARL PRITCHARD v. GLEN ROADKNIGHT, BOUCHER & JONES INC. and PARRSBORO METAL FABRICATORS LIMITED
and LENNOX CANADA INC. c.o.b. as BOEHMERS/CRONIN EMERY SERVICES EXPERTS
BEFORE: K. van Rensburg J.
COUNSEL:
F.D. Costantini, for the Moving Party
K.N. Hirani, for the Respondent
E N D O R S E M E N T
[1] This is a motion under rule 20 to dismiss a third party claim.
[2] In the main action the plaintiff claims damages resulting from the release of fuel oil from an oil storage tank located at his residential property in Guelph, Ontario.
[3] The defendants are Parrsboro Metal Fabricators Limited (“Parrsboro”), the manufacturer of the tank, Boucher & Jones Inc., (“Boucher & Jones”), the fuel oil distributor that filled the tank with fuel oil, and Glen A. Roadknight, an oil burner technician who purchased and installed the tank. The third party claim was issued by the defendant Boucher & Jones, claiming contribution and indemnity against the third party, referred to herein as “Service Experts”.
[4] The third party claim alleges that the defendant Roadknight was an employee of the third party and pleads in para. 6 as follows:
This Defendant pleads that the aforementioned fuel oil escape which occurred on the date of loss, was caused as a result of the negligence and breach of contract by the Third Party and/or by their servants, agents, contractors and employees, for whose negligence and breach of contract the Third Party is in law responsible and the particulars of which include, but are not limited to the following:
(a) The Third Party or its agents did not install the tank in question in accordance with the manufacturer’s suggestions;
(b) The Third Party or its agents did not install the tank in accordance with the Fuel Oil Code;
(c) The Third Party or its agents installed the tank in an orientation that they knew or ought to have known was going to cause water to build up in the interior of the tank;
(d) Subsequent to the installation of the tank the Third Party or its agents filled the tank with oil from a used oil tank;
(e) The Third Party or its agents failed to ensure that the installation of the tank was completed appropriately;
(f) The Third Party or its agents were incompetent and ought not to have been offering their services at the time in question;
(g) The Third Party or its agents certified that the installation was done appropriately when they knew or ought to have known that it was not;
(h) The Third Party or its agents knew or ought to have known that the improper installation was detrimental to the tank and would affect [its] integrity.
[5] The pleading, although phrased in terms of the direct liability of Service Experts, is in the circumstances of this case a pleading of vicarious liability. No Service Experts employee or agent was involved in the supply or installation of the tank other than Mr. Roadknight. There are no independent facts pleaded in support of the allegation of direct liability against Service Experts. There is no allegation of a failure to supervise, inspect, train, or of hiring incompetent personnel, such as one might expect in a pleading of direct negligence.
[6] Accordingly, the issue in this motion is whether the third party is entitled to summary judgment dismissing the claim, under Rule 20 of the Rules of Civil Procedure, on the basis that a trial is not required to determine that the third party is not vicariously liable for Mr. Roadknight’s alleged negligence. Put another way, the third party contends that there is no issue requiring a trial as to the allegations in the third party claim because Mr. Roadknight, while an employee of Service Experts, was not acting as its agent when he installed the oil tank.
[7] The motion was supported by the Affidavit of Scott Kroetsch, an employee and branch manager with Service Experts, who was also that party’s discovery witness. The third party also relies on the discovery evidence of the defendant Roadknight and the plaintiff. There was no responding affidavit, and no cross-examination of Mr. Kroetsch.
[8] The moving party asserts that it has met the “full appreciation” test under rule 20 as articulated in Combined Air Mechanical Services Inc. v. Flesch, 2011 ONCA 764. As noted at para. 50 of that case, the court is required to answer the following question: “Can the full appreciation of the evidence and issues that is required to make dispositive findings be achieved by way of summary judgment, or can this full appreciation only be achieved by way of a trial?”
[9] The third party points to the uncontroverted evidence that the defendant Roadknight was assisting a family friend as a personal favour, when he purchased and installed the tank in question. This occurred without the knowledge and approval of Mr. Roadknight’s employer, Service Experts, outside of his normal working hours, and in violation of the employer’s policy against moonlighting. Service Experts was not involved in the purchase, delivery, installation or commissioning of the tank. Mr. Roadknight, who remains an employee of Service Experts, was disciplined for misconduct for having violated the policy against moonlighting.
[10] The third party asserts that there is no basis for finding Service Experts vicariously liable for Mr. Roadknight’s conduct in relation to the tank, which was purchased and installed outside the scope of his employment.
[11] The defendant Boucher & Jones contends that the question of whether the third party is vicariously liable for Mr. Roadknight’s negligence requires a trial. Although the facts currently before the court may be inconsistent with vicarious liability, it is only at trial that Mr. Roadknight, the plaintiff and Service Experts can be cross-examined as to the true state of affairs. It is understandable that Mr. Roadknight, who is still employed by Service Experts, would disclaim any involvement by his employer. There is more information to obtain about the company’s employment policies and their enforcement. A trial is required in order to conduct the analysis of the issue required by Bazley v. Curry, 1999 692 (SCC), [1999] 2 S.C.R. 534.
[12] As a preliminary matter, the defendant asserts that there are outstanding undertakings and refusals from the examination for discovery of Mr. Kroetsch, which bear on the merits of the motion, and as such the third party should be precluded from proceeding with this or any other motion.
[13] Dealing first with the preliminary issue, I note that there is no specific provision in the Rules of Civil Procedure that would prohibit a party in default of an order from bringing a motion, without leave of the court. There is no civil rule equivalent to Family Law Rule 14(23). The statement of Corbett J. in Urbacon Building Groups Corp. v. Guelph (City), [2012] O.J. No. 56 (S.C.J.), at paras. 19 and 24, that a party who is in default under the rules, including by failing to answer undertakings and questions improperly refused, may not bring motions, was made in the context of a construction lien matter, where the ability to bring motions is restricted in any event.
[14] As a practical matter, if there are outstanding undertakings relevant to the respondent’s position on the motion, and where the provision of such information may support an argument that a trial is required, this may justify the adjournment or dismissal of a summary judgment motion. This is not because of any automatic rule that no motion can be brought by a party in default, but because the moving party would not have discharged its burden on the motion to prove that a trial is unnecessary. The failure of a party to comply with undertakings may warrant an adjournment of a summary judgment motion, or be relevant to its outcome, however this will depend on the particular context.
[15] In the present case, there is no court order against the third party that is outstanding. The defendant did not move on the refusals or actively pursue the undertakings, or suggest that the fulfillment of undertakings was necessary for the determination of the issues on the motion at any time before it delivered its factum responding to the summary judgment motion. In argument, counsel was unable to point to specific information from the undertakings that would materially affect the outcome of the motion. Finally, in support of the motion the third party submitted an affidavit, and the defendant did not cross-examine the deponent, who was also the third party’s discovery witness. The issue in respect of which there were outstanding undertakings, as will be seen in these reasons, was in any event irrelevant to the issue of vicarious liability in this case.
[16] Turning now to the merits of the motion, the third party contends that all of the facts relevant to vicarious liability are before the court, and uncontested. Mr. Roadknight was acting independently when he ordered and installed the oil tank. There was nothing to tie the third party to the alleged negligence of Mr. Roadknight, no assertion that he was holding himself out as an agent of the third party or that the plaintiff believed that he was dealing with Service Masters when the services were provided and the tank was supplied. As such there is no issue requiring a trial.
[17] There is no evidence tying the acts of Mr. Roadknight to his employer’s enterprise. There is no allegation that he was using Service Experts’ equipment or documentation or of anything that might reasonably have caused the plaintiff to believe he was dealing with Mr. Roadknight as a representative or agent of his employer. To the contrary, this was a “side job”, with no financial or other benefit to Service Experts. The uncontroverted evidence is that the plaintiff dealt with Mr. Roadknight personally with respect to the oil tank.
[18] The defendant acknowledges that there was no contradictory evidence on this point, but its focus in support of the motion is on the scope and enforcement of the third party’s moonlighting policy, which it contends needs to be more fully explored at trial. The argument seems to be that the third party ought to have ensured that the policy was known and understood by Mr. Roadknight and enforced through his dismissal. The fact that he was not dismissed suggests that the moonlighting was condoned by Service Experts. The essence of the argument appears to be that Service Experts would be vicariously liable for any negligence of Mr. Roadknight while he was moonlighting if they did not effectively enforce their policy against moonlighting.
[19] Because both parties relied on aspects of this case, I turn first to the decision of the Supreme Court of Canada in Bazley v. Curry. The plaintiff alleged that he had been abused as a child by the defendant Curry while in a residential care facility operated by the defendant Foundation. Curry was an employee of the Foundation and the abuse took place while the plaintiff was in the care of the Foundation.
[20] The court considered a stated case. Assuming that there was no independent negligence on the part of the Foundation, for example in the hiring or suspension of Curry, in what circumstances would there be vicarious liability for the illegal sexual assault he committed?
[21] The court recognized the traditional test for vicarious liability known as the Salmond test. An employee’s wrongful conduct falls within the course or scope of his employment where it consists of either (1) acts authorized by the employer or (2) unauthorized acts that are so connected with acts that the employer has authorized that they may rightly be regarded as modes – although improper modes – of doing what has been authorized. As McLachlin J. noted, it is often difficult to distinguish between an unauthorized “mode” of performing an authorized act and an entirely independent act.
[22] The court noted that the first step was to look at decided cases – are there precedents that unambiguously determine on which side of the line the case falls? If not, then the next step is to determine whether vicarious liability should be imposed in light of the broader policy rationales behind strict employer’s liability, which are deterrence, based on the introduction or enhancement of a risk, and fair compensation to plaintiffs.
[23] The court referred to cases where vicarious liability was based on an agency rationale – that an employee acting in furtherance of the employer’s aims has ostensible or implied authority to do the unauthorized act. The court observed that this rationale works well enough for torts of negligent accident. In cases of intentional torts, vicarious liability may be based on the employer’s creation of a situation of friction (where incidents can arise because of the nature of the employer’s business). McLachlin J. identified a common theme – that vicarious liability may arise “where the employee’s conduct is closely tied to a risk that the employer’s enterprise has placed in the community.”
[24] The court noted at paras. 37 and 40:
…The question in each case is whether there is a connection or nexus between the employment enterprise and the wrong that justifies imposition of vicarious liability on the employer for the wrong, in terms of fair allocation of the consequences of the risk and/or deterrence.
…The enterprise and employment must not only provide the locale or the bare opportunity for the employee to commit his or her wrong, it must materially enhance the risk in the sense of significantly contributing to it, before it is fair to hold the employer vicariously liable...
[25] In my view the Bazley policy analysis is not engaged in the present case. Bazley dealt with an intentional tort committed while the defendant was at work. The employee engaged in illegal conduct that the employer could not have authorized. It was not sufficient that the employment provided the time and place for the conduct; the enhancement of risk analysis was necessary to determine whether vicarious liability would follow.
[26] A “moonlighting” case involves different considerations. As the court in Bazley observed, where there is a tort of negligent accident, the “agency” rationale may be engaged. The question in this case is whether Mr. Roadknight was acting in furtherance of his employer’s aims and had ostensible or implied authority to do the alleged negligent act.
[27] In Bank Leu AG v. Gaming Lottery Corp., 2003 28360 (ON CA), [2003] O.J. No. 3213, the Court of Appeal considered the appeal of a decision at trial holding that the corporate third party was not vicariously liable for the misconduct of its employee who was acting in his personal capacity and not as its authorized representative in connection with the impugned transaction. At issue was vicarious liability for an intentional tort. Weiler J.A. stated at paras. 77, 79 and 80:
In determining whether an employer is vicariously liable for an employee's intentional tort, the analysis proceeds in two steps. The first step is to determine if existing authorities are decisive. If so, the analysis stops there. If not, the Court then proceeds to determine whether vicarious liability should be imposed in light of a broader based policy analysis based on whether the employer's enterprise created or significantly enhanced the risk of the harm that occurred: see Bazley v. Curry (1999), 1999 692 (SCC), 174 D.L.R. (4th) 45, at paras. 22, 41 (S.C.C.); Jacobi v. Griffiths (1999), 1999 693 (SCC), 174 D.L.R. (4th) 71 (S.C.C.), at paras. 67, 79. There must be a strong connection between the employer's enterprise and the risk of the harm that occurred, sufficient to justify imposing employer liability (Bazley, supra, at para. 42; Jacobi, supra, at para. 29).
Traditionally, an employer is liable for employees' unauthorized acts only if they are so connected with authorized acts that they might be regarded as modes, although improper modes, of doing them. The employer is not responsible if the wrongful act of an employee is not so connected with that authorized by or within the scope of employment as to be a mode of carrying out the employment. If the act can be viewed as an independent act of the employee, the employer will not be responsible: C.P.R. v. Lockhart, 1942 366 (UK JCPC), [1942] 3 W.W.R. 149 (P.C.), at 157.
Where the plaintiff deals with the employee in a personal capacity or enters into contracts with the employee in a personal capacity the employer is not vicariously liable: Bagoo v. Tasker, [1993] O.J. No. 1734 (Gen. Div.), at paras. 41-43; Campbell v. Sherman, [1993] O.J. No. 2815 (Gen. Div.), at paras. 168, 170; Bourgeault v. McDermid (1982), 1982 295 (BC SC), 140 D.L.R. (3d) 174 (B.C.S.C.), at 176, 177; Rowe v. Investors Syndicate Ltd., [1984] O.J. No. 346 (H.C.J.), at paras. 150-162. (Emphasis added.)
[28] The court concluded that existing authorities were decisive and that the trial judge’s finding that the third party had not authorized the conduct of its employee who was acting in his personal capacity, was supported by the evidence. The court went on to conduct the second stage of the analysis in Bazley, and concluded that in any event the third party’s enterprise did not contribute to the risk of what occurred (at para. 84).
[29] It is important to recall that the allegations in the third party claim in this case are that the third party “or its agents, contractors, servants or employees” committed certain acts of negligence. The only alleged agent or employee is Mr. Roadknight, so the issue is whether Mr. Roadknight was an agent or employee of Service Masters at the time that he procured and installed the oil tank. All of the evidence is inconsistent with any agency relationship. The plaintiff was dealing with Mr. Roadknight in his personal capacity in connection with the purchase and installation of the tank. As the Court of Appeal noted in Bank Leu AG, “if the act can be viewed as an independent act of the employee, the employer will not be responsible” (at para. 79). Whether there was a policy against moonlighting, the enforcement of the policy and whether or not Mr. Roadknight was fired for his conduct, in my view are irrelevant, if the uncontroverted evidence is that Mr. Roadknight was acting in his personal capacity.
[30] Vicarious liability is a form of strict liability. The conduct at issue is that of Mr. Roadknight for whose negligence Boucher & Jones seeks to hold the third party responsible. Any negligence on the part of the third party, including in the enforcement of its moonlighting policy, is irrelevant.
[31] All of the evidence suggests that the plaintiff was dealing with Mr. Roadknight in his personal capacity. As such there is no vicarious liability.
[32] Even if one were to adopt a Bazley “enhancement of risk” analysis, there is no question of Mr. Roadknight’s actions in connection with the oil tank procurement installation and commissioning being undertaken for the benefit of the employer or his employment by Service Masters materially enhancing the risk of what occurred. The employer received no benefit and, not knowing about the conduct, had no opportunity to supervise or control its execution. The employer’s enterprise did not contribute to the risk. There is no policy reason to extend liability to Service Experts in these circumstances.
[33] If I am incorrect in my conclusion that the third party’s enforcement of its moonlighting policy was irrelevant, the defendant had the opportunity to fully explore this issue in the context of the summary judgment motion. The obligation was to “put its best foot forward,” and as such the defendant cannot not simply rely on unanswered undertakings and refusals (which had not been pursued) when it had the opportunity to cross-examine on the affidavit filed in support of the motion.
[34] The motion for summary judgment is granted, and the third party claim is accordingly dismissed.
[35] If counsel are unable to agree on costs of this motion, I will receive written submissions as follows: the third party’s submissions within 30 days, responding submissions on behalf of the defendant Boucher & Jones within 20 days of receipt of the third party’s submissions, and reply submissions, if any, within ten days of receipt of the responding submissions.
K. van Rensburg J.
DATE: May 31, 2013
COURT FILE NO.: 23/10A (Guelph)
DATE: 20130531
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: CARL PRITCHARD v. GLEN ROADKNIGHT, BOUCHER & JONES INC. and PARRSBORO METAL FABRICATORS LIMITED
and LENNOX CANADA INC. c.o.b. as BOEHMERS/CRONIN EMERY SERVICES EXPERTS
BEFORE: K. van Rensburg J.
COUNSEL:
F.D. Costantini, for the Moving Party
K.N. Hirani, for the Respondent
ENDORSEMENT
K. van Rensburg J.
DATE: May 31, 2013