British Columbia v. Tekavec, 2013 BCSC 2312

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: British Columbia v. Tekavec, 2013 BCSC 2312 Date: 20131216 Docket: 12-2563 Registry: Victoria Between: Her Majesty the Queen in Right of the Province of British Columbia Plaintiff And: Louis Peter Tekavec and Louis Peter Tekavec doing business as Goldcrest Apartments Defendants And: Julia Mark, Bruce Billy and Edward Alexander Jack Third Parties Corrected Judgment: The front page of the judgment was corrected by the addition of co-counsel for the plaintiff on December 18, 2013. Before: The Honourable Mr.

Justice Bracken Reasons for Judgment Counsel for the Plaintiff: P. D. Ameerali, P. Lawless Counsel for the Defendants: C.D.R. Maddock, Q.C. No one appearing for the Third Parties Place and Date of Trial/Hearing: Victoria, B.C. October 4, 2013 Place and Date of Judgment: Victoria, B.C. December 16, 2013 [ 1 ] This is an application by Her Majesty the Queen in right of the Province of British Columbia (“the Province”) to strike the Response to Civil Claim filed by the defendant Louis Peter Tekavec (“the defendant”) doing business as Goldcrest Apartments.

The defendant has filed a cross application to strike out the Notice of Civil Claim brought by the Province. [ 2 ] At the heart of the issue is the Health Care Costs Recovery Act , S.B.C. 2008, c. 27 (the “Act”). That Act provides that the Province can recover the cost of health care services incurred by an injured person and paid by the British Columbia Medical Services Plan from a person responsible for the injury. The Act was proclaimed in force April 1, 2009. [ 3 ]

Section 2 of the Act provides: 2

(1) If, as a direct or indirect result of the negligence or wrongful act or omission of a wrongdoer, a beneficiary suffers a personal injury for which the beneficiary receives or could reasonably be expected to receive one or more health care services, the beneficiary may, subject to sections 6 [government may intervene in proceeding or assume conduct of claim] and 20 (2) and (3) [payments to the government] , recover from the wrongdoer (

a) the past cost of health care services, and (

b) the future cost of health care services. (2) Subsection (1) applies whether or not the personal injury was caused in whole or in part by the wrongdoer.

(3) For the purposes of subsection (1) but subject to section 20 (2) and (3) [payments to the government] , payment or expenditure by

the government, whether directly or through one or more agents or intermediaries, under any of the Acts referred to in the definition of “health care services” or under any other government plan or scheme of insurance for past and future costs referred to in subsection (1) must not be construed to affect the right of the beneficiary to recover those costs in the same manner as if those costs are paid or payable by the beneficiary.

(4) The past and future costs referred to in subsection (1) may be recovered as damages, compensatory damages or otherwise. [emphasis in original] [ 4 ] The Act makes provision for the Province to recover those costs from a person or corporation held responsible for causing the injuries. The Province can achieve its objective in four ways: 1.

By Section 3(1) of the Act a person who is entitled to receive medical benefits in British Columbia (“beneficiary”) who commences a legal proceeding against a wrongdoer for damages for personal injury or death must include a health care services claim in the legal proceeding. Section 3(3) requires a court to permit amendment of the originating documents to include a claim under the Act for up to six months after the date on which the originating documents were filed in the Court if a claim was not included in the originating documents. 2.

Section 6(1) of the Act permits the Province to intervene in any proceeding referred to in s. 3 and assume conduct of the health care services portion of that proceeding.

Section 7 of the Act provides that the Province is subrogated to any right which a beneficiary referred to in s. 2 has to recover past and future costs of health care services under that section. 4. Finally, s. 8 of the Act provides that the Province has a direct cause of action against the wrongdoer and may commence legal proceedings in its own name for the recovery of the past and future cost of health care services. [ 5 ]

Section 3 provides: 3

(1) If, in his or her own name or as a member of a class of persons under the Class Proceedings Act , a beneficiary referred to in section 2 (1) [beneficiary's right to recover] of this Act or his or her personal or other legal representative commences a legal proceeding against a person alleged to be the wrongdoer for damages arising from or related to the beneficiary's personal injury or death, the beneficiary or his or her personal or other legal representative must include a health care services claim in that legal proceeding. (2) Subsection (1) does not apply if the government has already done either of the following: (

a) settled the health care services claim referred to in subsection (1); (

b) commenced a legal proceeding under section 8 (2) [government has independent right to recover] to recover the past and future costs of health care services.

(3) If a health care services claim has not been included in a legal proceeding described in subsection (1), the court must permit amendment of the originating documents, up to 6 months after the date on which the originating documents were filed with the court, in order to provide for that inclusion.

(4) Nothing in the Limitation Act prevents inclusion of a health care services claim under subsection (3) if the original legal proceeding for damages under subsection (1) is brought within the time limited for doing so under that Act . [emphasis in original] [ 6 ]

Section 4 of the Act creates the obligation upon a person who has been injured as a result of the conduct of a wrongdoer to notify the Province of the claim within 21 days after commencing an action.

The Province may then choose to intervene in the action or assume conduct of the health care portion of the action. [ 7 ] The essence of the Act is to allow the Province the right to recover from a wrongdoer the health care costs incurred by the injured party by giving the Province the right to join an existing action, pursue an independent subrogated claim or to commence an independent action directly against the wrongdoer. [ 8 ] By the requirements upon the plaintiff to include a claim for health care costs incurred, and to notify the Province of the claim, the main thrust of the Act appears to be to try and recover its costs of health care within the plaintiff’s own action.

However, the Act also allows an action against the wrongdoer independently of any action commenced by the injured party. [ 9 ] In this case, while it was notified of Mr. Jack’s claim against the defendant, the Province elected to commence an independent action pursuant to s. 8 of the Act . It submits that any issues of the liability of the defendant were resolved in the action between Mr. Jack and the defendant, which resulted in a large award of damages to Mr. Jack: Jack v. Tekavec , 2010 BCSC 1773 (the “original action”).

The Province relies on the principles of res judicata and issue estoppel in asserting that it is entitled to recover from the defendant. In turn, the defendant relies on the same principles in his application to strike the Notice of Civil Claim. [ 10 ] The facts are relatively straightforward. On June 2, 2007, the third party, Edward Alexander Jack, was visiting Julia Mark at her apartment on the third floor of the Goldcrest Apartments. The defendant owns the Goldcrest Apartments. It is alleged that Bruce Billy lived in the apartment with Ms.

Mark and that at some point prior to June 2, 2007, he made some repairs to the railing of the balcony of the apartment. [ 11 ] On June 2, 2007, while Mr. Jack was visiting Ms. Mark’s apartment on the third floor of the building, he leaned on the balcony railing and it gave way. As a result, Mr. Jack fell from the balcony. He suffered injuries as a result of the fall and the Province has paid

$68,061.46 for the treatment of his injuries and hospitalization. It is that amount that the Province now seeks to recover from the defendant. [ 12 ] The injuries to Mr. Jack were incurred on June 2, 2007. He commenced an action against Tekavec on July 19, 2007. On April 1, 2009, the Act was proclaimed in force. On December 9, 2009, the Province received notice of the action from counsel for Mr. Jack. On June 8, 2010, the Province commenced this action and on December 24, 2010, judgment was rendered in the action between Mr. Jack and Mr. Tekavec.

The issue of health costs was dealt with at paras. 103 through 105 of his decision in the original action, where Savage J. stated: [103] In a written submission received after the oral hearing and argument the plaintiff put forward a claim under the Health Care Costs Recovery Act , S.B.C. 2008, c. 27 for $68,061.46. [104] In Gosselin v. Shepherd , 2010 BCSC 755 Mr.

Justice Sewell of this Court considered at length the statutory provisions, finding as follows: [37] My review of the Act leads me to conclude that it is not clearly and unambiguously intended to apply to actions commenced before the Act came into force. The presumption against retrospectivity set out in the cases referred to above together with the internal indications in the Act itself lead me to conclude that s. 2 of the Act has no application to actions commenced prior to the Act coming into force. [105] In this case the matter was not pleaded and at this stage the defendant is self-represented.

The action was commenced in 2007. Following Gosselin I find that the Health Care Costs Recovery Act does not apply to this action, as this action was commenced prior to that Act coming into force. [ 13 ] Gosselin v. Shepherd , 2010 BCSC 755 , was a case where the applicant applied to amend her statement of claim to add a claim pleading and relying on the Act . The applicant in that action sought to recover the costs of health care services provided to her by the Province. The injuries in that case occurred on June 7, 2005, prior to the act coming into force.

The application was dismissed. [ 14 ] In Gosselin , Sewell J. considered the application of the Act and at paras. 19 and 20 he said: [19] In particular, s. 24(1) makes the provisions of s. 8 applicable to personal injuries suffered by a beneficiary before or after the Act came into force. However, s. 8 expressly provides that the government must not commence a legal proceeding in its own right after the expiration of six months after the expiration of a limitation period that applies to the beneficiary's right to commence a legal proceeding against the alleged wrongdoer in respect of the personal injury.

Subject to any discoverability issues that limitation period is two years. Therefore on April 1, 2009 the government had a direct right of action for a health care services claim in respect of any injury suffered as a result of negligent conduct occurring two years and six months prior to that date, but not in respect of any claim which arose earlier. [20] In this case Ms. Gosselin's cause of action arose on June 7, 2005. Therefore the government has no direct right of action against the defendant under the Act . As Ms.

Gosselin commenced her action on March 1, 2007, the provisions of s. 3 , 4 and 5 of the Act do not apply to this proceeding. [ 15 ] The decision in Gosselin and in the original action both conclude that ss. 2 - 5 of the Act do not apply to causes of action that arose prior to the Act coming into force. In this case, the action was not filed until more than three years after the injury in question. However, the Province relies on s. 8(5) of the Act in support of its submission that its action was not filed outside of any limitation period. Section 8(5) provides: 8

(5) Subject to subsection (7), the government must not commence a legal proceeding under subsection (2) after the later of the following 2 dates: (

a) the date that is 6 months after the expiration of the limitation period that applies to the beneficiary's right to commence a legal proceeding against the alleged wrongdoer for damages in respect of the personal injury referred to in

section 2 [beneficiary's right to recover] ; (

b) the earliest of the following dates: (

i) the date that is 6 months after the date on which the government first receives notice under

section 4 [requirement to notify government of claim] ; … (iv) the date that is 6 months after the date on which the minister first receives notice under

section 12 [beneficiary's duty to give notice to minister before settlement] ; [emphasis in original] [ 16 ] Section 8(7) limits the applicability of s. 8(5)(b): 8

(7) Subsection 5(

b) does not apply if the limitation period referred to in subsection (5)(

a) has expired before the date that subsection comes into force. In other words, the Province cannot rely on a six month period for filing an independent action following the receipt of notice if the limitation period in the underlying action would have expired prior to April 1, 2009. That is not the case here, as the two-year limitation in the underlying action extended to June 2, 2009. The Province can therefore rely on s. 8(5) (b). [ 17 ] In this case, the Province received the beneficiary’s notice on or after December 12, 2009. It commenced its action on June 8,

2010, within the 6 month period provided by s. 8(5)(b). The notice appears to be a notice under s. 8(5)(b)(iv), a notice to the Ministerprior to settlement. There is nothing to suggest a settlement was contemplated at that point in the proceedings and it clearly stated thematter was set for trial in April 2010. It seems that the form was intended to give notice under s. 8(5)(b)(

i) but it was provided on thewrong form. Nothing turns on this as the same 6 month limitation period for filing an action under s. 8 applies. [18] I am satisfied that the Province has filed its action within the time limits provided by the Act as it filed its action within 6months of receiving notice from Mr.

Jack, in the original action. [19] The next issue is whether the Province is bound by the finding in the original action that the Act had no application as theoriginal action was commenced before the Act was proclaimed. [20] It appears that the Province elected to stand by and watch the proceedings in the original action without participating. When thejudgment was delivered, the Province did not challenge the decision, but instead elected to continue with this action. The Act providesby s. 19 that the Province could have taken an appeal on the original action, but it did not do so.

The defendant submits that the Provinceis now bound by the decision in the original action. [21] The Province relies on Translink v. British Columbia, 2013 BCSC 1602. In that case, Translink was a defendant in a claimbrought against it under the Occupiers Liability Act, R.S.B.C. 1996, c. 337. The injury in that case occurred on July 18, 2007 at askytrain station in Vancouver, British Columbia. The plaintiff commenced action against Translink on February 15, 2009, before theAct was in force.

Counsel for the plaintiff notified the Province about her claim and the Province responded that notice was not requiredbecause the action had commenced before the Act came into force. However, the Province advised the plaintiff that it required noticebefore any settlement was entered into. [22] The Province then commenced a lawsuit against Translink on February 5, 2010, claiming the right to recover health care costsfrom Translink resulting from the fall.

The Province did not serve the documents or advise Translink of its action until after January 13,2011. [23] However, in December of 2010, the plaintiff and Translink settled the action. The Province was not notified of the settlementor its terms. Ultimately, a consent dismissal order was entered. [24] The Province then amended its action under the Act against Translink to substitute a claim against Translink for debt. InProvincial Court, it was held that Translink and the plaintiff had entered into a settlement and Translink had failed to give the provincenotice as required by the Act.

Therefore, the court held that the Province had a right to recover its health care costs from Translink. Translink appealed. [25] In its appeal, Translink took the position that the action was not subject to the Act as the action was in existence before the Actcame into force and was therefore not subject to the Act. Translink relied upon Gosselin.

The Province took the position that s. 13 of theAct entitled the Province to recover. [26] In dismissing Translink’s appeal, Gray J. stated at para. 59: [59] The clear words of ss. 13 and 24 of the HCCRA impose an obligation on Payor-Settlers to give notice to the Minister ofsettlements, and if the Payor-Settler fails to give the prescribed notice, the government has the right to recover HCC as a debt from thePayor-Settler. There is no reason to exclude the settlement of Pre-CIF Lawsuits from the group of all settlements referred to in s. 13.

Such obligation to give notice and right for government to recover HCC from the Payor-Settler are consistent with the object of theHCCRA of recovering HCC from wrongdoers. Such obligation is not retroactive because it affects conduct occurring after the CIF Date,such conduct being the settling of claims.

Section 13 impairs the common law right to settle lawsuits, but the words of the statute saythat clearly, and it is consistent with the object of the HCCRA.

While the Gosselin case applies to lawsuits by MSP Beneficiariescommenced before the CIF Date, it addresses the right of the MSP Beneficiary to add a s. 2 claim, rather than the obligation of a Payor-Settler and the right of the government under s. 13 in those cases when a Pre-CIF Lawsuit settles. [27] The court held s. 13 of the Act deals with settlements and gave the Province the right to recover health care costs as a debt froma wrongdoer who has entered into a settlement with a plaintiff without first giving notice to the Province. That

section is distinguishedfrom the sections which deal with conclusion of actions such as the original action in this case, and the action in Gosselin. [28] It is perhaps useful at this point to refer to the decision of Re Hansard Spruce Mills Ltd., (BC SC), [1954] 4D.L.R. 590 (B.C.S.C.) where Wilson J. was asked to give a judgment at direct variance with that of another judge of the court. Herefused to do so. At paras. 2 - 5 of that decision, he said this: [2] I said what I thought about stare decisis as it relates to trial Judges in the Cairney case.

Since that time I have had the benefit ofreading the judgment of Robertson J.A. in Bell v. Klein (No. 1), (BC CA), [1954] 4 D.L.R. 273 at pp. 277 et seq. Hisdecision, insofar as it deals with the rule of stare decisis, is concurred in by O'Halloran, Sidney Smith and Bird JJ.A. and the dissentingjudgment of Sloan C.J.B.C. is based not on the question of stare decisis but on the main point of the appeal.

The decision of RobertsonJ.A. appears to establish with certitude the right and duty of the Court of Appeal to override previous rulings of that body which arefound to be wrong, and, despite the natural and proper caution with which this judgment is written, it appears to me that the right andduty so asserted are unqualified. [3] But, as I said in the Cairney case, I think the power, or rather the proper discretionary duty of a trial Judge, is more limited. TheCourt of Appeal, by overriding itself in Bell v. Klein, has settled the law.

But I have no power to overrule a brother Judge, I can onlydiffer from him, and the effect of my doing so is not to settle but rather to unsettle the law, because, following such a difference ofopinion, the unhappy litigant is confronted with conflicting opinions emanating from the same Court and therefore of the same legalweight. This is a state of affairs which cannot develop in the Court of Appeal. [4] Therefore, to epitomize what I have already written in the Cairney case, I say this: I will only go against a judgment of another

Judge of this Court if: (

a) Subsequent decisions have affected the validity of the impugned judgment; (

b) it is demonstrated that some binding authority in case law, or some relevant statute was not considered; (

c) the judgment was unconsidered, a nisi prius judgment given in circumstances familiar to all trial Judges, where theexigencies of the trial require an immediate decision without opportunity to fully consult authority. [5] If none of these situations exist I think a trial Judge should follow the decisions of his brother Judges. [29] Sewell J. in Gosselin and Savage J. in the original action concluded that certain sections of the Act did not apply to actionscommenced before the Act came into force.

However, in Gosselin, Sewell J. noted in para. 19 that the Province had the right tocommence an independent action under s. 8 seeking the recovery of health costs incurred before the Act came into force. In para. 20 heheld the claim of the Province could not succeed because the limitation period under s. 8 had expired. [30] Here, the limitation period had not expired when the Province commenced this action.

While the Province had commenced theaction prior to the decision in the original action, there is no indication that the existence of the independent action was raised or that anysubmissions related to it were made, although some submissions were apparently made respecting the recovery of health care costs aspart of the damage award even though the issue was not pleaded. [31] The defendant argues that the outcome of the original action is determinative of the claim in this action.

He submits that thecourt decided that the Act did not apply in the circumstances of this case and the Province is attempting to raise the same issue again inthis action. The defendant says that attempting to “… re-litigate issues that were finally determined in the original action and notappealed …” is an abuse of the process of the court. [32] In concluding the Act did not apply to the facts of this case, the court followed Gosselin which held that because the injuries tothe plaintiff occurred before the Act came into force, ss. 2, 3 and 7 had no application to the action.

However, as noted, the court inGosselin held that an independent action under s. 8 did apply to injuries that occurred before the Act came into force provided the actionwas commenced within the time limits allowed by the Act, which this action was. [33] I am satisfied that the Province has the right to maintain its independent action against the defendant.

The application of thedefendant to strike out the Notice of Claim is therefore dismissed. [34] I conclude that the Province has commenced its action within the time limits set out in the Act and that it is entitled to continueits action against the defendant. [35] The next issue is whether the defendant is bound by the outcome in the original action that found him 100% liable for theinjuries to Mr. Jack. [36] In the original action the court found that the defendant was liable under the Occupiers Liability Act, R.S.B.C. 1996, c. 337 andthat Mr.

Jack, the plaintiff in the original action, was not contributorily negligent. [37] The Province submits that the trial judge found the defendant 100% liable for Mr. Jack’s injuries. The defendant’s appeal wasdismissed, 2011 BCCA 464, and leave to appeal to the Supreme Court of Canada was denied, [2012] S.C.C.A. No. 4. [38] The test to be applied in an application to strike a Response to Civil Claim is set out in World Wide Treasure Adventures Inc. v.Trivia Games Inc., (BC CA), [1996] B.C.J. No. 21 (C.A.) at para. 37.

In that case the court said: On the basis of the foregoing authorities I am of the view that the following test should be applied on an application made under Rule19(24)(

d) on the basis of res judicata: if it is plain and obvious that the doctrine of res judicata applies to the plaintiff's new action, theaction should be struck; if it is not plain and obvious (with the burden resting on the applicant to establish the applicability of thedoctrine of res judicata) then the action should proceed to trial or, in appropriate circumstances, to

summary trial under Rule 18A. [39] To be successful in an application of the doctrine of issue estoppel, three conditions must be satisfied: (1) that the defencesadvanced in this action were raised and decided in the prior judicial decision; (2) that the prior judicial decision is final; and (3) that theparties to the prior judicial decision are the same as the parties to the current action, or their privies: Toronto (City) v. Canadian Unionof Public Employees (C.U.P.E.), Local 79, 2003 SCC 63. [40] In this case the parties are not the same. The original action was between Mr. Jack as plaintiff and the defendant.

The Provinceargues that it was a privy to the plaintiff in the original action, as it was in the same position as the plaintiff for the purposes of theapplication of the doctrines of issue estoppel or res judicata in that the liability of the defendant to the Province depends on the sameissues as were between Mr. Jack and the defendant in the original action. [41] Privity is an “elastic” concept: Danyluk v. Ainsworth Technologies Inc., 2001 SCC 44 at para. 60. In Giles v. WestminsterSavings Credit Union, 2006 BCSC 1600 at para. 45, the court accepted this definition of a privy from Donald J.

Lange, The Doctrine ofRes Judicata in Canada, 2d ed. (Toronto: Butterworths, 2004) at 77: A privy is a person who as a right to participate with a party in the proceeding or who has a participatory interest in the outcome. Todetermine whether a person has a participatory interest in the outcome of a proceeding is to determine whether the outcome could affectthe liability of that person. [42] While the Province could have joined in the original action to fully advance its claim, it chose not to. Perhaps that decisionresulted from the conclusion in Gosselin that the Act did not apply to the injuries Mr.

Jack suffered before the Act came into force so the

Province concluded it could not take an active role in the original action and had to proceed with an independent action. [ 43 ] Whatever the reason, it seems clear that the court in the original action thoroughly canvassed the issues the defendant has raised in its Response to Civil Claim filed in this action. I accept that the Province was sufficiently privy to the original action to engage the doctrine of issue estoppel. The Province had a right to participate with the plaintiff and had a participatory interest in the outcome.

If the court had determined that the defendant was not negligent that outcome would have bound the Province for the purposes of this proceeding. [ 44 ] The defendant referred to MacIver v. The Queen, 2005 TCC 250 , as support for its submission; however, that case is distinguishable on its facts and was not a case where conclusions were reached after a full trial on the very issues the defendant wishes to raise again in this action.

It is not appropriate to allow the same issues to be canvassed again in this action. [ 45 ] The issues of liability and contributory negligence were fully dealt with and the defendant has exhausted any rights of appeal. I am satisfied that the defendant is prevented from raising any defence related to his liability or the plaintiff’s contributory negligence in this action. [ 46 ] The defendant also argued that the third parties should be found at least partially liable.

The court in the original action dealt with the matter in this way at paras. 56 - 57: [56] Whether Billy or Mark are liable to Jack is a matter argued by Tekavec but neither was before the court as a party. At best Billy and Mark are concurrent tortfeasors, not joint tortfeasors. Of course, the independent wrongful acts of separate persons may operate concurrently to cause the same damage. So, for example, Tekavec argued that Billy's defective repair was the cause of the injury. Certainly the defective repair was a cause of the injury.

Although not argued, Tekavec could have asserted that Mark's failure to warn Jack was a cause of the accident. Arguably her failure to warn could be a cause of the injury. [57] As concurrent tortfeasors Billy and Mark would also be liable to Jack. But if Billy and Mark are concurrent tortfeasors this is no solace to Tekavec. Concurrent tortfeasors causing the same damage are individually liable to the plaintiff for all of the damage, absent contributory negligence.

As between themselves they may seek remedies but as between themselves and the plaintiff each is liable for all of the damage. [emphasis in original] [ 47 ] In his Response to Civil Claim in this action the defendant has issued a Third Party Notice to Mr. Jack, who was the plaintiff in the original action, Ms. Mark and Mr. Billy. None of them took

part in this proceeding. [ 48 ] The defendant submits that the issue of the liability of Ms. Mark and Mr. Billy was not fully canvassed or decided in the original action. Neither of them were parties to the action and the court at least suggested the possibility that one or both of them may have been found liable to Mr. Jack. The defendant submits that the Third Party Notice should not be struck out and the action should proceed as part of this action. [ 49 ] I accept the defendant’s submission on that point. The issues of liability as between Ms. Mark and Mr.

Billy were not fully and finally determined in the original action and the defendant should be allowed to continue the third party proceedings against them. However, the issues between the defendant and Mr. Jack have been fully determined in the original action and the Third Party Notice against Mr. Jack is struck out. [ 50 ] In the result, all issues of liability of the defendant for Mr. Jack’s injuries have been fully determined in the original action and his defence to this action is struck out.

The third party claims were not finally decided in the original action and the third party claim may proceed between the defendant and Ms. Mark and Mr. Billy. The Third Party Notice to Mr. Jack is struck out. [ 51 ] The application of the Province to strike the Response to Civil Claim is allowed. The application of the defendant to strike the Notice of Claim is dismissed. The defendant is entitled to proceed in his third party action against Ms. Mark and Mr. Billy. [ 52 ] Costs will be in the cause. “J. K. Bracken, J.” The Honourable Mr. Justice Bracken