Nowicki v. Price, 2011 ABQB 133

Court of Queen ’ s Bench of Alberta Citation: Nowicki v. Price, 2011 ABQB 133 Date: 20110303 Docket: 0503 18163, 0503 18869, 0503 20382 Registry: Edmonton Between: Docket: 0503 18163 Andrzej Nowicki Applicant/Plaintiff - and - Phyllis Price, City of Edmonton, and John Doe Ltd. Respondents/Defendants And Between: Docket: 0503 18869 Roberta Smith Plaintiff -and- Andrzej Nowicki, Phyllis Price, and the City of Edmonton Defendants And Between: Docket: 0503 20382 Barbara Nowicki

Plaintiff -and- Andrzej Nowicki, Phyllis Price, and the City of Edmonton Defendants _______________________________________________________ Reasons for Judgment of the Honourable Madam Justice A.B. Moen _______________________________________________________ I. Introduction [ 1 ] This application to sever liability is related to three actions, all arising out of the same automobile/bus collision.

The application also seeks to have the liability portion of all three actions heard together. [ 2 ] On December 16, 2003, a City of Edmonton ("City") bus operated by the Defendant, Phyllis Price, hit the back bumper driver's side of an automobile driven by Andrzej Nowicki.

The two parties do not agree on who is liable. [ 3 ] Arising out of the collision are three actions. [ 4 ] In the first action (Action No. 0503 18163), Nowicki is the Plaintiff and the City of Edmonton and the bus driver are the Defendants. [ 5 ] In the second action (Action No. 0503 18869), the plaintiff is Roberta Smith, a passenger in the bus. The City of Edmonton and Andrzej Nowicki are named as defendants. [ 6 ] In the third action (Action No. 0503 20382), Barbara Nowicka is the plaintiff. Nowicki and the City and the driver are the defendants.

Barbara Nowicka is the wife of Andrzej Nowicki and was a passenger in his automobile. [ 7 ] This application is made by Andrzej Nowicki in his capacity as Plaintiff in the first action and as co-defendant in the second and third action. The City of Edmonton is Respondent to the application in the first action as the Defendant and in the second and third actions as co-defendant. [ 8 ] The City of Edmonton’ argument was also on behalf of the other Defendant, Phyllis Price as she is an employee of the City.

[ 9 ] The parties agree that the liability issues arise out of the same facts and therefore should be heard together. However, the parties disagree that liability should be severed from the damages portion of each of the actions. [ 10 ] The Applicant, Nowicki, makes this application to sever the liability and damages portion of the trial. He says that his cost of obtaining the medical evidence necessary to prove his claim will be futile if he is liable for the collision. [ 11 ] The City suggests that there should be one trial for liability portion and damages.

It suggests that the quantum of damages for each of the three trials should be heard consecutively by the same justice. Roberta Smith asks that the liability portion be severed. Andrzej Nowicki, as Defendant, takes no position. The Plaintiff, Barbara Nowicka, takes no position. Therefore, two plaintiffs want the liability portion of the trial severed and the City does not. [ 12 ] The New Alberta Rules of Court , Alta. Reg. 124/2010 (“New Rules”) came into force on November 1, 2010. Rule 7.1 provides for severance of an issue.

Therefore, I must decide in this case whether the liability portion of each of the actions should be severed and then the liability portion heard together for the three actions. II. Discussion [ 13 ] The Applicant takes the position that Rule 7.1 does away with the old "exceptional case" test in favour of a more lenient analysis.

The Respondent, the City of Edmonton, is of the view that the change in language does not do away with the "exceptional case" test. [ 14 ] When the matter was heard on December 8, 2010, counsel for the City asked for time to prepare a brief on the impact of the New Rules on severance of an issue, and particularly, the impact of the Foundational Rules. Those briefs are now in. [ 15 ] In the meantime, I heard another application by the City to sever an issue in an entirely different matter.

In both matters the City was consistent in arguing that the New Rules did not have an impact on the test for severance -- that is, the exceptional case rule still applied. I rejected that argument in Envision Edmonton Opportunities Society v.

Edmonton (City) , 2011 ABQB 29 , in which I found that the New Rules indeed did have an impact, and that the old test, that of exceptional case, no longer applied. [ 16 ] I will not repeat my analysis in Envision but refer to the whole of that decision for my reasons that the exceptional case test no longer applies. [ 17 ] The City of Edmonton suggests that in doing so, I would be disagreeing with the decision of my brother, Yamauchi J., in Alberta (Attorney General) v.

United Food and Commercial Workers Union, Local No. 401 , 2010 ABQB 777 at para. 28 , where he says that Rule 7.1 “does not impose any new test” as compared with Rule 162 of the Alberta Rules of Court , Alta. Reg. 390/1968 (“Old Rules”). I am advised by Justice Yamauchi that he is issuing a corrigendum for that decision revising paragraph 28 to replace “7.1" with “7.2" wherever that appears.

Consequently, Justice Yamauchi’s decision does not contradict my decision in Envision . [ 18 ] The analysis that I suggested in Envision , which I will follow here, was that one must first look to Rule 7.1 and determine if the threshold was met for severance, and then look at the case as a whole to determine if the Foundational Rules for cost effectiveness and timeliness, among other things, would be met by the severance. I will follow that analysis in this case. [ 19 ] Therefore, I will proceed to analyse the case before me by asking the two questions: 1. Does this case satisfy the three part test in Rule 7.1?

2. If it does, would severance be impacted by the Foundational Rules? [ 20 ] Given that the parties all agree, I order that the actions be heard together as to the liability portion. In these reasons I will consider whether the liability portion of the trial should be heard separately from the quantum issues for each of the three actions. [ 21 ] There is no doubt that a trial of the issue of liability is necessary. The parties are unable to resolve that issue.

The City says that Nowicki was entirely responsible, Nowicki says the City bus driver was entirely responsible, and there is always the possibility that there will be a finding of joint liability or contributory negligence. [ 22 ] In the spirit of the Foundational Rules, we discussed whether there could be a judicial dispute resolution (JDR) of the liability issue, but given that the City maintains that there are issues of credibility, a judge in a JDR could not easily give an opinion as to liability. The most that could be done in a JDR is an assessment of risk.

Therefore, it is inevitable that there will be a trial on the issue of liability for the collision. [ 23 ] The question is, then, should that issue be severed? A. Does this case satisfy the three part test in Rule 7.1? [ 24 ] New Rule 7.1 states the following: 7.1(1) On application, the Court may (

a) order a question or an issue to be heard or tried before, at, or after a trial for the purpose of: (

i) disposing of all or part of a claim, (ii) substantially shortening a trial, or (iii) saving expense. [ 25 ] For this analysis the court must look at three potential reasons for splitting a trial as set out in the Rule 7.1. The applicant suggests that all three of those purposes will be served by this court ordering a liability trial separate from the trial of quantum issues. [ 26 ] As in Envision , I point out that the test is in three parts and those parts are disjunctive.

That is, I only need to find one of them to move on to considering the impact of the Foundational Rules on a particular severance application. [ 27 ] The Applicant strongly suggests that a determination of liability will likely avoid a quantum of damages trial and consequently, there will be savings of time and money for the parties and for the court.

It says this on the basis that a settlement is more likely with the liability issue settled, thereby making unnecessary quantum trials, at least for two of the actions. [ 28 ] First, I point out that any finding that expense will be saved, or that a trial will be shortened or that severing will dispose of all or part of a claim does not require a finding to a certainty. If it were, then one would never sever. Rather, I must find that there is a good chance that an expense will be saved, or all or part of a claim will be disposed of, or that a trial will be substantially shortened.

[ 29 ] Therefore, I will consider first whether severing liability will save expense. 1. Will severing the liability issue save expense? [ 30 ] Mr. Nowicki, the Applicant, swears in an affidavit that if he must go to trial on all of the issues that he will have the cost of proving his injury claim, including the costs of medical reports and assessments, as well as the attendance at trial of expert, lay and other professional witnesses. The trial time will be long and court costs considerably greater. After such a long trial, if he is found to be 100% liable, he will not be entitled to any damages.

Further, he will be responsible for the City's costs of trial in addition to his own costs. If he is liable, there is no need for him to proceed with a damages trial for his injuries, nor for him to go to the expense of experts and their reports.

If he is wholly or partly liable, he must then turn his attention to the other two actions and the quantum of damages he must pay to the other two plaintiffs. [ 31 ] Thus, Nowicki makes out a claim that a severance will save expense for him. [ 32 ] As I stated above, there is no 100% guarantee that Nowicki will not end up having to prove his damages if the City is 100% liable.

However, Nowicki could then assess the risk and the likelihood of recovery as against the cost of experts and a trial and determine if he should pursue damages. [ 33 ] Further, knowing who is liable will surely save expense for the other two plaintiffs who will then be able to commence negotiation with the party(ies) responsible. If they are successful in their negotiations, the expense of a relatively lengthy quantum trial is saved. 2. Will severing the liability issue dispose of all or part of a claim? [ 34 ] There is no doubt that once liability is determined, it will dispose of that part of the claim.

It will not need to be revisited in a quantum trial. Any findings will be recorded in the reasons of the liability judge for consumption by the quantum judge. Liability is a discrete issue which will be dealt with finally by severance of that issue. 3. Will severing the liability issue substantially shorten the trial? [ 35 ] It is our experience that the liability portion of a motor vehicle accident claim is by far the shortest part of the trial.

The quantum portion of that claim is usually by far the longest and most expensive portion because of the numerous experts involved. [ 36 ] Where liability is a live issue, settlement of an action becomes remote. Therefore, if that issue is determined, the person(

s) responsible for paying the damages for each of the second and third actions will be clear and a settlement is much more likely. While there remains a disagreement between the two defendants as to who must pay the damages, two of the Plaintiffs, Barbara Nowicka and Roberta Smith, are caught in limbo. [ 37 ] Consequently, at least two of the actions may settle, substantially shortening the trials of those actions. 4.

Conclusion [ 38 ] Therefore, I find that severance of the liability portion of these actions will most likely dispose part of a claim, could substantially shorten a trial because settlement will then be possible for the second and third actions, and will save expense for Nowicki in the first action. If settlement is achieved by two of the plaintiffs, expense will be saved for them as well.

[ 39 ] The test for severance has been met. [ 40 ] I must now turn to the Foundational Rules to determine if they will have an impact on whether to sever. B. Would severance be impacted by the Foundational Rules? [ 41 ] The New Rules introduce Rule 1.2 under the broad heading, "Foundational Rules," and the more specific heading, "Purpose and Intention of These Rules." This is a new concept. As in Envision , I set out the whole of that Rule in an appendix at the end of these reasons. [ 42 ] In particular, I set out portions of Rule 1.2 which apply in this case as follows: 1.

Purpose and intention of these rules 1.2(1) The purpose of these rules is to provide a means by which claims can be fairly and justly resolved in or by a court process in a timely and cost-effective way.

(2) In particular, these rules are intended to be used: (

a) to identify the real issues in dispute , (

b) to facilitate the quickest means of resolving a claim at the least expense , (

c) to encourage the parties to resolve the claim themselves , by agreement, with or without assistance, as early in the process as practicable, ... [my emphasis] [ 43 ] Further, the Foundational Rules require the parties to determine from time to time how they can resolve the real issues in the quickest way and at the least expense. They are also to evaluate alternatives to trial as means of resolving disputes. Finally, they are to use publicly funded Court resources effectively: Rule 1.2(3). [ 44 ] The Respondent, City of Edmonton, says that the norm is to have all issues heard at the same time.

To date this has been true. However, the New Rules invite all of us, the Court and counsel, to find ways of reducing time and expense to get to resolution of disputes. Therefore, we must look seriously at whether a severance of issues is likely to dispose of a dispute entirely, thereby saving time and expense, or shorten a dispute or lead to resolution of some or all of the other issues. [ 45 ] In this case, the parties are ready to go to a liability trial. Engineers' reports have been obtained. The parties estimate that it would be a trial that would take about three days.

Given the status of our court calendar, we are able to put in trials of less than five days within a very short time. [ 46 ] One thing front and centre in the amendments to the Rules was consideration of the cost of litigation and the fact that ordinary people simply cannot afford to go to court to have their disputes decided. The Foundational Rules require the court and all lawyers to find means of settling those disputes quickly and cost effectively. We must, therefore, consider carefully why we should follow the old "exceptional case" rule in resolving modern disputes. 1.

Quickest means of resolving the claim [ 47 ] The Applicant argues that the issue of liability is the single largest impediment to a settlement of the actions. He argues that

[ 47 ] The Applicant argues that the issue of liability is the single largest impediment to a settlement of the actions. He argues that if liability were determined, the parties would likely come to a settlement on at least some of the damages shortening a damages trial and perhaps avoiding one altogether. [ 48 ] Nowicki further argues that a liability trial will be short and will be set down in a shorter time frame than a complete trial involving the damages issues for three plaintiffs. [ 49 ] Therefore, a decision on liability will occur quickly compared to a trial of all issues heard together.

This will permit all plaintiffs to pursue their damages through negotiation sooner than if they had to wait for a full blown trial of both liability and of damages. The Applicant points out that the other parties injured, Barbara Nowicka and Roberta Smith, cannot receive their damages awards until it is determined which of the two defendants is liable. [ 50 ] Nowicki is not ready to go to a damages trial. He must retain independent medical experts and the City must then retain experts in rebuttal. The complete trial is a very long way down the road.

In the meantime, the other two plaintiffs in the second and third actions must wait. [ 51 ] Not to sever the liability portion of the trial will delay two of the litigants that are ready to proceed on quantum and who could at least begin a negotiation on quantum as soon as the trial judge rules on liability. [ 52 ] Therefore, it appears that on balance, those litigants would benefit from the severance of the liability trial.

Waiting for a full trial because there might be an appeal is disproportionate to permitting two of the plaintiffs to get on with finishing the action. [ 53 ] If Nowicki is found not liable for the collision, he will be able to claim damages from the City. If he is found partially liable, he will also be able to claim damages from the City. Once he knows the extent of his liability, he will be able to do a cost benefit analysis of his position - what it will cost him to prove his damages compared to a likely award. [ 54 ] Once liability is determined, the parties do not need to go to a trial.

They may negotiate a settlement or they may go to judicial dispute resolution. Those options are open to them once liability is determined. Without that determination, only a trial is open to them. Therefore, on balance, all of the issues in the case before me can be resolved more quickly and less expensively than going for a full blown liability/damages trial. [ 55 ] Therefore, I find that severance of the liability portion of the three actions will lead to the quickest means of resolving the claim and will encourage settlement of the damages portion of the actions.

Settlement negotiations can get underway very shortly after the liability is determined. 2. Encourage parties to resolve the claim without intervention of the Court [ 56 ] The Applicant argues that two of the plaintiffs will know at the end of a liability trial who is responsible for their damages and it could lead to a quick settlement. Until they know this, they do not know with whom to negotiate a settlement. 3.

Resolving the issues at the least expense [ 57 ] I have found in my consideration of Rule 7.1 that severing the liability issue would most probably save expense. [ 58 ] The Plaintiff, Nowicki, given that he may be liable for some or all of the damages, pleads that he should be able to delay retaining expensive experts on the issue of damages until he knows if he is entitled to any damages. This is an argument relating to the cost of litigation. The Foundational Rules require us to consider the quickest means of resolving the dispute at the least expense.

[ 59 ] There is no trial date set. The Applicant says that he cannot afford to risk incurring the high cost of medical assessments and expert witness fees in the event his claim of liability is unsuccessful. Therefore, the Applicant suggests that forcing him to go to a full quantum trial will not serve the interests of justice and will create an injustice. Further, the Applicant says that the issue of liability is not complicated. It will be a question of eyewitness evidence and two engineering experts, all of which could be heard in two or three days.

The Applicant suggests this is not too complex for the trial of an issue. [ 60 ] I find that these requirements of the Foundational Rules for cost effectiveness and timeliness have been met by the Applicant for a severance of the liability portion of the trial. [ 61 ] Nevertheless, in the “exceptional case” cases that applied heretofore, there were many arguments made for not severing issues. The Respondent, City of Edmonton, made a number of other arguments that I do not find are important in the analysis in this case. Nevertheless, I shall comment on each of them. C.

Other considerations [ 62 ] First, the Respondent says that there are issues of credibility which the trial judge must find respecting Nowicki’s version of how the collision happened. The Respondent then says that this finding will have an impact on Nowicki's credibility in assessment of damages. I should note that this only matters with respect to Nowicki's damages, not the damages of Barbara Nowicka or Roberta Smith. Therefore, the City says one judge should hear the whole trial.

It says that breaking up the two parts will necessarily mean that the credibility findings by one judge, if two hear the two parts of the trials, will be lost and Nowicki may be believed in the quantum part of the trial where a judge who heard both parts may treat his credibility differently. [ 63 ] I do not think this is a problem. [ 64 ] If findings of credibility are made, the liability trial judge will say so in his/her judgment. This can then be considered by the damages trial judge.

Further, typically, the medical evidence and objective findings of doctors and other health professionals are given the most weight. And that evidence is largely found in documents and in the evidence of the doctors. If Nowicki has been giving different stories to different medical professionals that are inconsistent throughout, that difference will be considered by a quantum court and will be evident in the written exhibits. [ 65 ] The City further says that of necessity in this case there will be overlapping evidence.

However, that overlapping evidence apparently pertained to Nowicki's description of how the collision occurred and how he hit his head in the impact. He has apparently given three different versions that the Respondent says will be difficult to reconcile. The evidence of his head hitting is important to the determination of how the collision occurred and will be considered by the expert reconstruction engineers. Findings of fact as to what happened in the collision will be made by the trial judge. Those findings will be considered by the quantum trial judge.

It is unlikely that there will be different findings of fact about how the collision happened. [ 66 ] The Respondent also says that third party witnesses, such as the ambulance drivers, may be required for both trials. [ 67 ] If third party witnesses are needed for both trials, then a judge hearing the quantum trial can make a preliminary determination (if the parties cannot agree) that the transcript of that evidence be admitted in the quantum trial. There is no question about credibility with respect to those witnesses.

Further, if Nowicki gives contradictory evidence at the quantum trial, he can be impeached using the transcript of the liability trial. [ 68 ] Certainly there may not be a clean break point between the two trials, but should this be sufficient to deny a liability trial that may resolve most if not all of the lawsuits, be less expensive to the three plaintiffs, and bring the matters to a close for at least the plaintiffs in the second and third actions? In my opinion, the answer is no. [ 69 ] The City also points out that there may be logistical issues: appeals, timing.

[ 70 ] The argument against severance by the City of Edmonton that an appeal will only delay is an argument that can be made in every case for severance. As in Envision , I reject this as a standard argument. It must be clear that an action is likely to be delayed by the possibility of an appeal before I would accept this as a reason to deny severance. [ 71 ] In a normal case where the collision happened a year or two ago, it makes eminent sense to have the liability trial when memories are fresh. Liability trials usually do not take more than a week.

Therefore, they can be arranged with the court early in the process. It is my experience that motor vehicle trials usually do not occur for over four years because the injuries of the plaintiff are developing and the parties usually want to see if the injuries are minor or if they are major. If liability is at issue, then an early trial will not delay the quantum trial even where there is an appeal. Therefore, the issue of delay is not important if the liability trial is heard shortly after the collision occurs. [ 72 ] In the case before me, the issue of delay becomes more important.

The difficulty in this case is that it is seven years since the collision. Will the trial of quantum be delayed in this case if the liability portion is severed? If it will be delayed, what other factors weigh in favour of severing? [ 73 ] First, the Court of Queen's Bench can set a short (less than 5 days) trial within two months. In this case, I was advised that all parties on the liability issue are ready to proceed. Engineers' reports have been obtained. The liability issue is waiting for the quantum issue to be ready.

Therefore, the parties could have a liability trial in this term of Court sittings: Spring term 2011. It is likely that the trial judge would decide the issue quickly. [ 74 ] The question then becomes how long it will take for an appeal. If the parties are diligent in filing the appeal and the appeal books, it is likely to be dealt with within a year. The trial would not be long, it would be mostly factual. I was not advised of any likely issues of law that would invite an appeal.

Therefore, it is likely that the appeal would be dealt with expeditiously if the appellant moved this part along quickly. [ 75 ] Will this delay the quantum issues being tried? Once the liability is determined, two of the Plaintiffs in two of the three actions can proceed with a negotiated settlement. They are ready to deal with damages. Those Plaintiffs are prepared to proceed with a quantum negotiation, JDR, or trial. Until liability is determined, they cannot negotiate because neither Defendant (Nowicki or City) will pay out, nor do they seem ready to talk to the plaintiffs.

It appeared to me that the parties were not even seriously discussing the issue. [ 76 ] If the liability and quantum portions of the dispute are tried together, then it will take at least until 2012 for a trial to be heard. This assumes that Nowicki is ready to go on quantum. Given that there are no independent medical expert opinions regarding Nowicki done by either party and given my experience in case managing and pre-trying such matters, getting those medical opinions will take several months, if not longer than a year. III.

Conclusion [ 77 ] I sever the liability portion of the actions in all three actions and direct that the liability portion be heard concurrently. [ 78 ] The Applicant shall have its costs in this application. Any other submission on costs may be brought before me provided it is scheduled within one month of the release of these reasons. Heard on the 8 th day of December, 2010. Further written argument made January 11, 2011 and January 21, 2011.

Dated at the City of Edmonton, Alberta this 3 rd day of March, 2011. A.B. Moen J.C.Q.B.A. Appearances: Craig MacKay Frieser Robinson MacKay LLP for Andrzej Nowicki (as Plaintiff) Christine McAvoy Weir Bowen LLP for Andrzej Nowicki (as Defendant) Kim Fallis-Howell The City of Edmonton for Phyllis Price and The City of Edmonton David Witten Iginla & Company for Roberta Smith (not present at hearing) Derek Van Tassell Stefura, Greber & Beal LLP for Barbara Nowicka (not present at hearing)

APPENDIX "A" Foundational Rules Division 1 Purpose and Intention of These Rules What these rules do 1.1(1) These rules govern the practice and procedure in (

a) the Court of Queen's Bench of Alberta, and ...

(2) These rules also govern all persons who come to the Court for resolution of a claim, whether the person is a self-represented litigant or is represented by a lawyer. Purpose and intention of these rules 1.2(1) The purpose of these rules is to provide a means by which claims can be fairly and justly resolved in or by a court process in a timely and cost-effective way.

(2) In particular, these rules are intended to be used (

a) to identify the real issues in dispute, (

b) to facilitate the quickest means of resolving a claim at the least expense, (

c) to encourage the parties to resolve the claim themselves, by agreement, with or without assistance, as early in the process as practicable, (

d) to oblige the parties to communicate honestly, openly and in a timely way, and (

e) to provide an effective, efficient and credible system of remedies and sanctions to enforce these rules and orders and judgments.

(3) To achieve the purpose and intention of these rules the parties must, jointly and individually during an action, (

a) identify or make an application to identify the real issues in dispute and facilitate the quickest means of resolving the claim at the least expense, (

b) periodically evaluate dispute resolution process alternatives to a full trial, with or without assistance from the Court, (

c) refrain from filing applications or taking proceedings that do not further the purpose and intention of these rules, and (

d) when using publicly funded Court resources, use them effectively.

(4) The intention of these rules is that the Court, when exercising a discretion to grant a remedy or impose a sanction, will grant or impose a remedy or sanction proportional to the reason for granting or imposing it.