Access to justice at stake in government's civil liability review
Letter to the Attorney General
September 23, 2002
The Honourable Geoff Plant, QC
Ministry of Attorney General
11th Floor, 1001 Douglas Street
Victoria, BC V8W 9J7
Dear Mr. Attorney:
Re: Civil Liability Review
Re: Civil Liability Review
At our meeting on September 6, 2002 the Benchers of the Law Society of British Columbia discussed your Ministry's Civil Liability Review initiative. While the Benchers were of the view that it is not within the Law Society's mandate to deal directly with the substantive issues raised by the Review, it is clearly within its mandate to address matters affecting access to justice as well as matters generally affecting the public interest in the administration of justice as set out in s. 3 of the Legal Profession Act.
The Civil Liability Review consultation paper raises a number of significant public policy and, more particularly, access to justice issues, and it is our view that these are not adequately addressed in the consultation paper. Reform in the areas of law discussed would have a significant impact on parties involved in civil litigation, and might be generally expected to diminish the likelihood of plaintiffs obtaining recompense for damages suffered. Alternatively, if a judgment for damages is obtained, realizing on the judgment may become significantly more difficult. Where a diminution of litigants' expectations is a real possibility, the Law Society believes that a careful, detailed examination of particular proposed reforms is required, a process that by necessity would require significantly more consultation and discussion than has occurred in this process.
By way of comparison, the Law Society points to the process undertaken by your Ministry in its Administrative Justice Review Project. There, government released discussion papers on specific topics for consideration, and invited comment from interested parties. The government, we believe, benefited from the comment generated on the specific topics, and was able to create a White Paper that appears to have met with a general degree of approval.
The following discussion identifies some of the Law Society's public interest concerns with respect to each of the six areas of civil liability being considered for reform.
1. Limitations Laws:
The consultation paper appears to support changing the ultimate limitation period (ULP) from 30 years to 10 years, but it does not address the question of whether some causes of action should continue to fall outside an ULP.
The Law Society is also concerned that the paper does not provide sufficient analysis of the question of when the ULP should begin to run. The present regime, in which the period starts to run from the date the cause of action accrues, provides some protection for bona fide claims where damage is not suffered until some time in the future. There is also a strong argument to be made that a special 30 year ULP should continue in certain cases to ensure that the interests of the most vulnerable members of society are protected, including minors and the disabled.
Therefore, while a review of the law of limitation periods, particularly the ULP, may indeed be timely and warranted, legislative reform of this area needs further examination and consultation in order to establish the correct legislative response. That consultation and discussion has not been allowed to occur.
2. Joint and Several Liability
The consultation paper offers no evidence indicating there to be a crisis in BC arising out of "at-fault" defendants being held jointly and severally liable to an innocent plaintiff. If a plaintiff is innocent of any wrongdoing and the defendant is found negligent resulting in a loss to the plaintiff, the present law reasonably places the burden of seeking indemnity from co-defendants on an at-fault defendant rather than on a blameless plaintiff.
The Law Reform Commission itself, in its 1986 report examining these issues, commented that this approach was an "eminently sensible" one. It noted, in fact, that the British Columbia Negligence Act has already "amended" the law on this topic by providing that if the plaintiff was at fault to any degree, only several liability applied as to the defendants. The Law Reform Commission questioned whether it was fair even in those circumstances to place the whole of the burden of the insolvent defendant on the plaintiff.
It is not clear that it is in the public interest to change the system to make innocent plaintiffs bear the risk of a defendant's insolvency. In the absence of evidence that the current law is not operating well, it is difficult to postulate on possible alternatives for reform. If government's concern is with a particular industry (for example, insolvent defendants in the construction industry) consideration could instead be given to legislative changes in the industry concerned, rather than re-writing the law of negligence as a whole. For example, it may make more sense for government to consider introducing requirements for performance bonds or mandatory minimum insurance rather than embarking on a general revision to the law of joint and several liability.
Because of a lack of any evidence suggesting a pressing need for reform, the Law Society is concerned that many more problems than solutions may be created arising from ill-considered reform and that such solutions may well not be in the public interest. If evidence does exist indicating a pressing need for reform, the Law Society believes such evidence should be clearly presented, including the type and extent of the problems arising from the present law concerning joint and several liability, and that a full opportunity be given for consultation and discussion of the issues by interested parties on the basis of that evidence.
3. Costs in Class Action Suits
Class action proceedings vary the normal rules in costs by prohibiting the courts from awarding costs against either party unless there is improper conduct. A change in the rules to allow costs against a plaintiff may, however, impede access to justice by deterring potential representatives from bringing a class action if they face liability for costs if unsuccessful. This defeats the access to justice objective of class proceedings. Lawyers may also not be willing to take on class proceedings on behalf of representative plaintiffs if they have to assume a burden of costs as well as the risk that the action may not succeed.
The consultation paper states that "it has been argued that this costs provision is uneven in its application." The paper states that defendants must incur enormous and unrecoverable costs in the discovery process that are typically not incurred to the same extent by plaintiffs. There is, however, no analysis of this argument, nor is it stated whether this argument has specifically been raised by concerned defendants or whether it is raised simply on the basis of anecdotal evidence.
There are many arguments both in favour of and against the present "no costs" regime in British Columbia. These arguments are thoroughly set out in the Alberta Law Institute's Final Report No. 85 (December 2000) concerning class actions. American jurisdictions have favoured a "no costs" regime, and that regime is recommended by the Alberta Law Institute. Ontario and Quebec have taken a different approach, although the Ontario approach includes a government-funded fund against which representative plaintiffs could apply for indemnification of costs awards. A "no costs" rule, it should be noted, also reduces the financial risk to defendants opposing the claim. Of course, even in a "no-costs" regime, the court can still award costs if some abuse of process occurs.
No empirical evidence was included in the consultation paper showing that defendants are indeed suffering severe prejudice as a result of the current "no costs" regime in British Columbia. Without evidence of a pressing problem, and without the benefit of broader consultation and discussion, the Law Society does not see a need to amend the legislation. If amendments are to be considered, however, the Law Society would appreciate further information from the government on the issues, particularly as to whether there is a real crisis with respect to the present cost provisions contained in the Class Proceedings Act.
4. Vicarious Liability Holding Employers Responsible for the Actions of their Employees
Without the vicarious liability doctrine, a plaintiff who has suffered damage is less likely to find a defendant able to pay on a judgment. The doctrine also serves the function of making it more likely that employers will exercise a higher degree of scrutiny or caution when hiring an employee. The availability of insurance, based on risk, enables an employer to compensate the plaintiff, thereby removing the burden from the taxpayer. From a plaintiff's perspective, it is difficult to imagine why one would be opposed to the doctrine. From a public interest perspective, vicarious liability functions both as a fair and practical remedy for harm, and as a deterrent against possible future harm.
There has, however, been some discussion of principled legal analysis against vicarious liability, and there has been some judicial invitation for the Legislature to consider reform of this area of law. The Law Society believes that there needs to be a clearer expression by the government of what it proposes as a legislative amendment on this topic before any useful comment could be made about alternatives to reform. The available possible types of reform are too wide-ranging to comment on in a general sense. For example, if reform were needed, should vicarious liability be statutorily abolished? Or should it be kept, but have classes of defendants statutorily exempted? If this course were followed, what criteria would be required for a class of defendants to be exempted? Alternatively, is a solution (if one is needed) to be found in legislation abolishing the test for vicarious liability as set by the Supreme Court of Canada, and substituting a different test? Choosing one option over another without consultation or discussion by all interested parties is, in the view of the Law Society, a dangerous exercise.
5. Alternatives to Traditional "Lump Sum" Damage Awards
As is the case with its discussion of all of the areas under review, the consultation paper provides no evidence that the current approach is flawed or unjust. Some of the disadvantages to introducing structured settlements as an option in all cases are that the plaintiff is denied the flexibility to make his or her own investment and consumption choices, and once made, the structure cannot usually be modified. A mandatory scheme also would prevent the courts from determining what arrangement is in the best interests of a particular plaintiff. Such a scheme also gives rise to the risk of a default if a defendant does not have adequate means to fund periodic payments over time.
Plaintiffs in sexual abuse and other cases involving vulnerable plaintiffs may also have concerns that it would be inappropriate to allow the perpetrator to have any continuing role in their lives.
The consultation paper suggests that there is a basis for legislation in support of judicial structured awards because of advances made in actuarial science and the experience gained from negotiated structured settlements. No analysis or explanation of this assertion is made, nor is any example provided as to how such advances or experience may be applied to legislated changes. Neither is any analysis provided of whether, or to what extent, a problem currently exists in British Columbia concerning this area of law.
The Law Society believes that before a decision can be made as to whether legislative reform is called for, further consultation and discussion on the topic is required.
6. Non-delegable duty doctrine
The doctrine of non-delegable duty offers protection to an injured plaintiff if, without it, he or she could be left without a remedy. There are good policy reasons for the doctrine in circumstances where the nature of the relationship between the plaintiff and defendant contains a special element that may justify a higher obligation on the defendant to ensure that care is taken in the fulfillment of a duty. On the other hand, arguments have been made that there is an apparent absence of any coherent theory to explain why, or when, a particular duty should be classified as non-delegable. Questions have been raised as to whether the uncertainty and complexity of the law as it has developed is matched by corresponding advantages.
The consultation paper argues that one of the difficulties with the non-delegable duty doctrine is the "uncertainty of its conceptual foundations" without elaborating on this point. There is no discussion advanced of types of problems raised by the doctrine other than an underlying premise that the increased scope of liability arising by virtue of the doctrine is not warranted. The Law Society believes that discussion of the policy underpinnings of the doctrine is necessary prior to providing a response as to whether there is a need for legislative reform to the doctrine and, if so, what form a legislative response should take. Unfortunately, there has been no consultation with interested parties on that point, and no opportunity for interested parties to address specific concerns, since no such concerns have been identified.
Therefore, the Law Society believes that before a decision can be made as to whether legislative reform is called for, further consultation and discussion on the topic is required.
As will be evident from a review of our comments above, the Law Society does not believe that the government has undertaken a sufficient consultation or discussion process in this exercise. If reform of the law in each of these areas is indeed required, the Law Society believes that the government should clearly put forward the reasons for the need for reform, rather than making vague allusions to a need for reform and inviting general comment. A series of detailed discussion papers on each topic on which comment could be elicited, such as was done in the Administrative Justice Project, would be a much preferable preliminary route to follow.
Historically, when governments have wished to consider reform to specific areas of law, the issues have been put to the appropriate Law Reform Commission, or, in its present incarnation in British Columbia, the Law Institute. In that fashion, an independent body is given the task to consider, after necessary research, deliberation, and consultation, whether law reform is warranted and whether it would serve the public interest. However, the Law Institute, which exists to comment on public policy and law reform, has apparently been bypassed by the government despite the fact that civil liability review would appear, on its face, to cry out for a public policy analysis concerning law reform by an independent body.
The Law Society therefore strongly recommends that the government refer the topics of its consultation paper to the Law Institute, and that the government properly fund the Institute in order to enable it to consider the need, if any, for reform in the areas of law identified.
If the government chooses to pursue these initiatives, or any of them, we ask that there be a full consultation of all affected parties, based on a full development of the proposals, including supporting research and disclosure of specifics of each proposal. On that basis, we would be pleased to participate further, within our mandate.
Yours very truly,
Richard C. Gibbs, QC