Docket: 1899 Paul Medvid, Shaine Medvid v. Coreen Hardy, 2012 SKCA 49

THE COURT OF APPEAL FOR SASKATCHEWAN Citation: 2012 SKCA 49 Date: 20120425 Between: Docket: 1899 Paul Medvid, Shaine Medvid and Coreen Hardy Appellants (Plaintiffs) - and - Her Majesty the Queen in Right of Alberta, as represented by The Minister of Health and Wellness for Alberta Respondent (Defendant) - and - Her Majesty the Queen in Right of Saskatchewan, as represented by the Minister of Health for Saskatchewan, Regional Health Authority #9, also known as Prince Albert Parkland Regional Health Authority, Prince Albert Parkland Health Region, and its Predecessors, Regional Health Authority #1 also known as Sun Country Regional Health Authority, and its predecessors Regional Health Authority #5 also known as Sunrise Regional Health Authority, and its predecessors, Regional Health Authority #3, also known as Cypress Regional Health Authority, and its predecessors, Regional Health Authority #10, also known as Prairie North Regional Health Authority, and its predecessors, Lloydminster Health District, Alberta Health Services, and all of its predecessors, including, but not restricted to: Peace Country Health, and its predecessor Keeweetinok Lakes Regional Health Authority #15 Non-Parties (Defendants)

Coram: Klebuc C.J.S., Jackson and Herauf JJ.A. Counsel: E.F. Anthony Merchant, Q.C. and Nicholas Robinson for the Appellants Ward Branch for the Respondent Alberta Appeal: From: 2010 SKQB 22 Heard: April 26, 2011 and September 8, 2011 Disposition: Dismissed with minor variation to costs award Written Reasons: April 25, 2012 By: The Honourable Mr. Justice Herauf In Concurrence: The Honourable Chief Justice Klebuc The Honourable Madam Justice Jackson

Herauf J.A. I. Introduction [ 1 ] Paul Medvid, Shaine Medvid and Coreen Hardy (the “appellants”) appeal from the decision of Dawson J. which struck the action as it relates to Her Majesty the Queen in Right of Alberta, as represented by the Minister of Health and Wellness for Alberta (“Alberta”). The claim was struck against Alberta on the jurisdictional principle of Crown immunity. Justice Dawson concluded that the Saskatchewan Court of Queen’s Bench, in a proposed class proceeding in Saskatchewan, does not have jurisdiction over Alberta.

She also awarded costs to Alberta as provided for in Rule 173 of The Queen’s Bench Rules of Saskatchewan. [ 2 ] The appellants submit the learned chambers judge erred in her ruling on the jurisdictional issue and in her award of costs. Therefore, the appellants request that the appeal should be allowed and Alberta be reinstated as a defendant in the class action proceeding. They also maintain that the costs order should be set aside on the basis that s. 40 of The Class Actions Act, S.S. 2001, c.

C- 12.01 (the “ Class Actions Act ”) provides that costs not be awarded in class action proceedings, other than on a very limited basis. [ 3 ] For the reasons that follow, I would dismiss the appeal but for a minor variation to the costs award. In all other respects I would affirm the decision of Dawson J. II. Background [ 4 ] The appellants commenced a proposed class proceeding in Saskatchewan against Alberta and other defendants in relation to certain health services provided in Alberta and Saskatchewan.

Specifically, the appellants allege that between January 1981 and November 10, 2008 Alberta and the other defendants re-used syringes to inject medication and thereby exposed the appellants to infection. [ 5 ] In accordance with the authority provided in Rule 99 and Rule 173 of The Queen’s Bench Rules , Alberta brought a motion to strike the appellants’ claim as against Alberta on the grounds that the Saskatchewan Court of Queen’s Bench does not have jurisdiction over Alberta. [ 6 ] Dawson J. considered the jurisdictional challenge based on the following facts pled in the proposed Amended Statement of Claim: 6 The plaintiffs commenced the within action against the defendants, including Alberta, under The Class Actions Act .

As stated, the plaintiffs have not yet applied to have the action certified as a class action. Alberta's within application to strike is being considered prior to the application for certification. 7 The within action was commenced by two plaintiffs (with the plaintiffs being given leave, on conditions, to add Coreen Hardy as a third plaintiff). It is expected that these three plaintiffs will likely seek to be representative plaintiffs in the class action, should a class action be certified. The plaintiff, Paul Medvid, resides in Yorkton, Saskatchewan and received medical treatment in High Prairie, Alberta.

The plaintiff, Shaine Medvid, resides in Yorkton, Saskatchewan and received medical treatment in High Prairie, Alberta. The plaintiff, Coreen Hardy, resides in Lloydminster, Saskatchewan and received medical treatment in Lloydminster, Saskatchewan and Lloydminster, Alberta. 8 The claim asserts the defendant Alberta is responsible for health and dental services in the Province of Alberta.

The claim also asserts that Alberta is a predecessor of Alberta Regional Health Authorities, also named as a defendant in the action, which is a governmental body designated as being a corporation, created by a provincial statute of Alberta. 9 The claim asserts that Her Majesty the Queen in Right of Saskatchewan as represented by the Minister of Health is responsible for health and dental services in Saskatchewan (Saskatchewan).

The claim asserts Saskatchewan is the predecessor of the Saskatchewan Health Authorities named as defendants. 10 All of the other defendants are Health Authorities and Health Regions which are constituted pursuant to statute and which operate hospital and health care facilities within their respective boundaries. 11 The claim asserts that the defendant, Lloydminster Health District, is a body that was created jointly by Saskatchewan and Alberta

and administered jointly by both.

In respect of the Lloydminster Health District, the claim asserts that all of the health care facilities that are relevant to these proceedings are in the Province of Saskatchewan. 12 It is alleged that the events which give rise to the claim occurred in High Prairie, Alberta, Prince Albert, Saskatchewan, Lloydminster, Saskatchewan, Weyburn, Saskatchewan, Swift Current, Saskatchewan and Yorkton, Saskatchewan. 13 Generally, the claim asserts that during the period of January 1981 to November 10, 2008, the defendants did negligently and improperly reuse syringes or needles to inject medication into patients' intravenous bags, and thus subjected those patients to the risk of infection from blood-borne diseases.

That is, the claim alleges that various medications and anaesthetics were routinely injected into plastic intravenous tubing lines, connected to bags of medication, with syringes or needles that had been previously used in such lines attached to other patients. The claim alleges that the syringes and needles were reused without being sterilized.

It is further alleged that at Lloydminster, this occurred in the Lloydminster General Hospital, Saskatchewan, primarily in the surgical units. 14 The claim alleges that the specific danger of the above is that the intravenous lines sometimes have blood seeping into them from a vein of the patient, and a syringe or needle could come in contact with such blood and spread an infection.

The claim alleges also that whenever a new syringe or needle was hooked up, there was the possibility of backflow into the intravenous bag. 15 The claim further asserts that in relation to the plaintiff, Coreen Hardy, that she received treatment for a colonoscopy and endoscopy on September 28, 2008 at the Lloydminster Hospital, which is in Saskatchewan, and that she was attached to an intravenous line for the purpose of administering medication and other fluids. It is alleged that Ms. Hardy received intravenous transfusions of medication or anaesthetic processed and supplied by Alberta Health Services.

It is further alleged that the medication or anaesthetic products had a likelihood of being contaminated, due to the negligent and improper reuse of syringes or needles. The claim alleges that Hardy was, or was likely, infected with H.I.V., H.C.V., H.B.V. and other blood-borne diseases, or was exposed to a serious risk of infection, and suffered severe emotional distress as a result thereof. The claim further alleges that Ms. Hardy had attended on a doctor in Lloydminster, Alberta and that doctor referred Ms.

Hardy to the Lloydminster Hospital (which is on the Saskatchewan side of the City of Lloydminster), and her exposure to the previously used needles occurred when she underwent the colonoscopy and endoscopy in Saskatchewan. 16 The claim further asserts that the plaintiff, Paul Medvid, received intravenous medication that had a likelihood of being contaminated in the same way by the improper reuse of syringe or needles in High Prairie, Alberta. 17 The claim further asserts that the plaintiff, Shaine Medvid, also received intravenous medication at High Prairie, Alberta, and that those medication products were contaminated in the same way with a blood-borne infectious disease due to the improper reuse of syringes or needles. 18 The claim further asserts Alberta's liability on the following basis in paras. 32A through 32D: 32A.

The Alberta Government and [sic] is liable for the acts, omissions and wrongs of Alberta Health Services. The corporate veil is pierced, inter alia , because: (

a) at all material times the Alberta Government had complete control over Alberta Health Services given that the board of Alberta Health Services "reports directly to the Minister of Health and Wellness", as stated on the Alberta Health Services website; (

b) the Alberta Government was involved in establishing policies, procedures and operational standards for Alberta Health Services and was Alberta Health Services' directing mind; (

c) Alberta Health Services was incorporated to shield the [sic] Alberta from liability for wrongs committed by the Regional Health Authorities and Agents of the Alberta Government; (

d) there is no arm's length relationship between Alberta Health Services and the Alberta Government; (

e) Alberta Health Services' board members are appointed by the Alberta Government. 32B. In a November 12th, 2008 letter to class member, Debra Witbeck ("Witbeck"), Alberta Health Services states that Witbeck "may have been exposed to an infection control risk as a result of the multiple use of syringes used to administer medication through IV lines". Alberta Health Services, and by extension the Alberta Government, has admitted the breach of the duty to use only syringes that are fit for use with IV lines for the administering of drugs and fluids. 32C.

In the November 12th, 2008 letter to class member, Debra Witbeck ("Witbeck"), Alberta Health Services states that it "understand this letter may cause some stress and worry". Alberta Health Services, and by extension the Alberta Government, has admitted that its breaches of its duties to the Plaintiffs and the Class will cause damages, namely stress, worry, anxiety and anguish. The Alberta Government, and by extension Alberta Health Services have admitted causation. 32D.

In the November 12th, 2008 letter to class member, Debra Witbeck ("Witbeck"), Alberta Health Services states that "even though the risk of catching blood-borne diseases, like HIV, Hepatitis B and Hepatitis C is very low, AHS-PCH is conducting a thorough review to identify those patients who may want to consider a blood test".

Alberta Health Services, and by extension the Alberta Government, has admitted that the Plaintiffs and the Class will suffer bodily injuries, including HIV and Hepatitis, that will merit damages. [Note: the underlining shows the plaintiffs' proposed amended pleadings] 19 The plaintiffs assert claims against Alberta in negligence, breach of fiduciary duty, battery, breach of Charter ( Canadian Charter of Rights and Freedoms ,

Part I of the Constitution Act, 1982 , being

Schedule B to the Canada Act 1982 (U.K.), 1982, c. 11) duties, and assert a claim against Alberta as one of "liability of a government responsible for the matters relating to health care". 20 The statement of claim asserts that the subject matter of these proceedings occurred largely in Saskatchewan and that many, or

most of the class members, including the potential representative plaintiffs, are Saskatchewan residents and, as such, the plaintiffs seek relief from the Saskatchewan courts. The claim goes on to assert that The Class Actions Act of Saskatchewan permits the proceedings to be brought in relation to plaintiffs and class members outside Saskatchewan, and for torts which occurred outside Saskatchewan. III. Decision of the Chambers Judge [ 7 ] Justice Dawson concluded the principle of Crown immunity applied and the Saskatchewan Court of Queen’s Bench had no jurisdiction over Alberta.

She reasoned that the courts of this Province could not entertain suits against the Crown in right of another province unless the legislation of the other province expressly permitted such extra-territorial claims, and that s. 8 of the Alberta Proceedings Against the Crown Act , R.S.A. 2000, c. P-25 (the “Alberta Act ”) did not open the door for an action against Alberta in another province. Justice Dawson also found that even though the Saskatchewan Class Actions Act allowed for multi-jurisdictional class actions, the Act : (

i) only related to jurisdiction over the plaintiffs; (ii) does not speak specifically to creating jurisdiction over defendants; and (iii) does not assert that Saskatchewan had jurisdiction over other provincial Crowns. Furthermore, even if the Saskatchewan Legislature had the authority to enact legislation to compel Alberta to submit to the jurisdiction of the Saskatchewan courts, waiver of provincial Crown immunity and/or sovereign immunity had to be made with clear and precise language, and no such language existed in the Saskatchewan Class Actions Act .

Finally, Dawson J. found that Alberta, in undertaking to provide healthcare for the public, was exercising a public function of the government and not a commercial activity. Consequently, the restrictive theory of provincial Crown immunity did not apply. [ 8 ] With respect to costs, Dawson J. simply ordered costs to Alberta as provided for in Queen’s Bench Rule 173. IV. Grounds of Appeal [ 9 ] The appellants set out eight grounds of appeal: 1.

The chambers judge erred in law by declaring that the Alberta legislature can limit the jurisdiction of Her Majesty's Saskatchewan Court of Queen's Bench when the grant of jurisdiction of the Alberta legislature under s. 92 of the Constitution Act, 1867 (U.K.), 30 & 31 Vict., c. 3 is limited to matters within the province; 2. The chambers judge erred in law in finding that the principle of sovereign immunity applies, rendering it impossible for plaintiffs to sue colluding or jointly liable provincial and territorial government defendants in a single lis ; 3.

The chambers judge erred in law by making a finding of sovereign immunity which, in the circumstances, has violated the Plaintiffs' rights to redress for breaches of their s. 7 of the Charter of Rights and Freedoms, in particular the right to security of the person; 4. The chambers judge erred in law by declaring that the Saskatchewan Court of Queen's Bench lacks jurisdiction over Alberta; 5. The chambers judge erred in law by failing to consider the issue of Saskatchewan's real and substantial connection to the litigation, or questions of fairness, order and comity; 6.

The chambers judge erred in law in finding that the Alberta Proceedings Against the Crown Act does not permit actions against Alberta in other jurisdictions; 7. The chambers judge erred in awarding costs in an action commenced pursuant to the Class Actions Act ; and 8. The chambers judge erred in awarding costs against the appellants in accordance with Rule 173. V. Standard of Review [ 10 ] The standard of review for points 1 to 6 of the grounds of appeal is correctness. See Housen v. Nikolaisen , 2002 SCC 33 , [2002] 2 S.C.R. 235 and H.L. v. Canada (Attorney General) , 2005 SCC 25 , [2005] 1 S.C.R. 401.

[11] With respect to the costs issues, Alberta suggests that the standard of review is that which is applicable to a discretionary power. Inthis appeal, however, the appellants have raised a question of law as to whether, as a matter of statutory

interpretation, s. 40 of the ClassActions Act precludes an award of costs. This also attracts a correctness standard. VI. Analysis [12] I will deal with each ground of appeal in the order set out. In situations where the grounds of appeal overlap, these grounds will bedealt with collectively. 1. The chambers judge erred in law by declaring that the Alberta legislature can limit the jurisdiction of Her Majesty'sSaskatchewan Court of Queen's Bench when the grant of jurisdiction of the Alberta legislature under s. 92 of the ConstitutionAct, 1867 (U.K.), 30 & 31 Vict., c. 3 is limited to matters within the province. (

a) Submissions of the appellants [13] The appellants submit that s. 92 of the Constitution Act permits a province to legislate on matters local to that province, including:“(14) the Administration of Justice in the Province, including … Civil … and … including Procedure in Civil Matters in those Courts;and

(16) Generally all Matters of a merely local or private Nature in the Province”. As a result, the Alberta Act, which attempts topreclude a Saskatchewan court from asserting its jurisdiction over an action which names Alberta as a defendant, is constitutionallyinapplicable. The appellants rely on an

article authored by Professor Janet Walker entitled “Interprovincial Sovereign ImmunityRevisited” (1997) 35 Osgoode Hall L.J. at 385 to support their contention. Professor Walker, based upon her review of the SupremeCourt of Canada decisions in Morguard Investments Ltd. v. De Savoye, (SCC), [1990] 3 S.C.R. 1077 and Hunt v.

T&Nplc, (SCC), [1993] 4 S.C.R. 289, concludes that while provinces may legislate on matters within their jurisdiction, anyattempt to purport to limit the jurisdiction of the superior courts of other provinces would be ultra vires. [14] The appellants also submit that Morguard and Hunt laid to rest the notion that sovereign immunity can be utilized betweenprovinces to prevent a superior court from assuming jurisdiction over a provincial Crown of another province.

Therefore, this court canconsider a constitutional challenge to the Alberta Act since there is a real interest affected in the rights of residents of Lloydminster,Saskatchewan who jointly have a claim against Alberta and Saskatchewan. In these proceedings, where the defendants are jointly liable,a real and substantial connection exists between the jurisdiction and the subject matter of the litigation. As a result, class proceedings arenecessary to ensure access to justice and judicial economy. Therefore, a finding of sovereign immunity would be unconstitutional. (

b) Submissions of Alberta [15] Alberta takes issue with the appellants’ characterization of the ruling of the chambers judge as a declaration which limits thejurisdiction of the Saskatchewan Court of Queen’s Bench for she made no such pronouncement in her decision. More importantly,Alberta submits the appellants’ characterization presumes her decision was based upon the Alberta Act removing jurisdiction when thestarting point is that there is no right to sue Alberta in another province.

The Alberta Act creates an exception to this general principleand permits lawsuits against Alberta to be brought in Alberta courts. The fact that such permission does not extend to lawsuits brought inother jurisdictions cannot be construed as an attempt by the Alberta Legislature to limit the jurisdiction of the Saskatchewan Court ofQueen’s Bench since such jurisdiction never existed. (

c) Discussion and Conclusion [16] That said, I turn to a preliminary matter. This court notes the appellants called into question the constitutional validity of theAlberta Act but did not provide notice to the Alberta Attorney General as required by the Alberta Judicature Act, R.S.A. 2000, c. J-2, s.24.

When this was brought to the attention of counsel for the parties, Alberta took the position that it was prepared to make submissionson this point if the court was inclined to deal with this specific issue. [17] In the result, I find that we do not have to hear any further submissions on this matter for two reasons. Firstly, I agree with counselfor the respondent that the appellants’ attempt to characterize Dawson J.’s decision as a declaration that the Alberta Legislature can limitthe jurisdiction of Saskatchewan courts is misguided.

No such declaration was sought and there is nothing in the reasons of Dawson J.that suggests otherwise. Secondly, and in any event, Dawson J. carefully considered this argument. She was not persuaded that it hadmerit and stated: 37 The law is clear that despite critical academic arguments, courts outside a province cannot entertain suits against a provincialsovereign Crown, unless the legislation of the provincial Crown expressly permits such extraterritorial claims.

In coming to this conclusion, the chambers judge reviewed the extensive case law which dealt with this issue. None of the decisionsextended the reasoning of the Supreme Court in Morguard and Hunt, as suggested by Professor Walker and other academics, tosituations involving Crown immunity. See Athabasca Chipewyan First Nation v. Canada (Minister of Indian Affairs and Northern Development), 2001 ABCA 112, 199 D.L.R. (4th) 452; Liability Solutions Inc. v. New Brunswick (2007), (ON SC),88 O.R. (3d) 101 (S.C.); Phillips (Guardian ad litem of) v. Beary (1994), 29 C.P.C. (3d) 258; Kaman v.

British Columbia, 1999 ABQB216, 242 A.R. 336. [18] I can state it no better than Hunt J.A. did in Athabasca where she made the following comments: 38 Both Morguard, but especially Hunt, were cases where the court of one province properly had assumed jurisdiction over thelitigation. Here, in contrast, jurisdiction is the central issue. On that basis alone these cases are distinguishable.

But there are morefundamental reasons why the principles in Morguard and Hunt should not govern here. 39 Our constitutional regime "recognizes the diversity of the component parts of Confederation, and the autonomy of provincialgovernments to develop their societies within their respective spheres of jurisdiction." Reference re Secession of Québec, (SCC), [1998] 2 S.C.R. 217 at 251. The law regarding the Crown as litigant in relation to the Crown in right of a province isprovincial law. Quebec North Shore Paper v. C.P. Ltd., (SCC), [1977] 2 S.C.R. 1054 at 1063.

It is contrary to our basicnotion of federalism that the decision of one provincial Crown about the extent to and the manner in which it waives its immunity couldbe declared constitutionally inapplicable by courts established by the Crown in another province. [19] Recently, the Ontario Court of Appeal in Sauvé v. Attorney General of Québec et al., 2011 ONCA 369, dismissed an appeal from adecision that the Province of Québec has immunity against a lawsuit launched in Ontario. The court stated: 3 The Crown is immune against suit except as expressly provided by statute or by necessary implication.

While the provinciallegislation permits suits against the Crown, it provides the manner in which those suits may be brought. The Québec Civil Code providesspecific rules governing actions against the Province of Québec. Those rules apply only to Québec actions. Thus, the legislationpermitting proceedings against the Crown in right of the province, renders Quebec liable to be sued in the courts of its own province butnot in the courts of other provinces. [20] I agree with the conclusion of Dawson J. on this point. There is simply no basis to find that the Alberta Act is constitutionallyinapplicable.

I would not give effect to this ground of appeal. [21] The following grounds of appeal bring into question the principle of Crown immunity and therefore, I will concurrently addressthem. 2. The chambers judge erred in law in finding that the principle of sovereign immunity applies, rendering it impossible forplaintiffs to sue colluding or jointly liable provincial and territorial government defendants in a single lis; 3.

The chambers judge, in making a finding of sovereign immunity, erred in law by effectively preventing the appellants fromobtaining a remedy for the breach of their rights under s. 7 of the Charter of Rights and Freedoms in contraction to the principlesof fundamental justice; 4. The chambers judge erred in law by declaring that the Saskatchewan Court of Queen’s Bench lacks jurisdiction overAlberta. (

a) Submissions of the appellants [22] I would prefer to deal with these three grounds of the appeal by asking whether the chambers judge erred in concluding that theprinciple of Crown immunity applies. The appellants point to the following factors which they say are relevant to their conclusion thatDawson J. erred in her ruling: (

i) Both Alberta and Saskatchewan are jointly liable to members of the putative class who received treatment funded by bothGovernments in the Lloydminster, Saskatchewan/Alberta region. A finding of sovereign immunity would bar the appellants from suingeffectively in either province. If the appellants were compelled to sue each defendant individually in each respective province,procedural problems would arise and it would be impossible to conduct a fair and efficient trial which would deny the putative classaccess to justice;

(ii) The intent of class action legislation is to have jointly liable provincial Crowns dealt with in one proceeding. Alberta has previouslyindicated its willingness to be subject to the outcome of class action litigation in other jurisdictions. This must mean that Albertarecognizes the benefits of judicial economy to defendants. The application of sovereign immunity would destroy the Legislature’s goalof judicial economy through class proceedings; (iii) Lawsuits in each province would result in duplication with an increased burden on class members and the courts of the respectiveprovinces.

Individual proceedings would be cost prohibitive to the appellants. Judicial economy would suffer; (iv) Putative class members living in Lloydminster would have to join proceedings in other parts of Alberta in order to sue Alberta. Since no proceedings have been launched in Alberta, limitation periods may already have expired; (

v) The appellants’ Charter rights have been limited since Alberta will have escaped an award or appropriate remedy that the courtcould have granted for the alleged s. 7 Charter violations; and (vi) The outdated and archaic doctrine of sovereign immunity runs contrary to the principles of fairness, comity and inter-dependence aselaborated by the Supreme Court in Morguard. This is very relevant since Saskatchewan has a real and substantial connection to thelitigation and Alberta has significant contacts with Saskatchewan through joint health care funding in the Lloydminster region. (

b) Submissions of Alberta [23] Alberta’s position is that the chambers judge did not err in her conclusion that provincial Crown immunity applies to this situation.

Historically, the Crown is immune from suit and courts outside of a province’s home jurisdiction cannot entertain suits against thatprovince, unless the local legislation within the province specifically and expressly permits such extraterritorial claims against it. [24] With respect to the Charter issue, Alberta submits there can be no s. 7 violation since putative class members could have launchedan action against Alberta in the Alberta Court of Queen’s Bench.

Furthermore, if a limitation period problem now arises it is due to thedecision of counsel not to commence class proceedings in both Saskatchewan and Alberta.

It also contends that the chambers judge wascorrect to conclude that the Saskatchewan Class Actions Act, which allows a multi-jurisdictional class action, does not provide thatSaskatchewan has jurisdiction over other provincial Crowns. [25] Finally, Alberta submits that the chambers judge correctly concluded that the facts as pled against Alberta’s conduct inSaskatchewan relate to the provision of health care and do not relate to commercial activities which have been recognized as an exceptionto the principle of Crown immunity. (

c) Discussion and Conclusion [26] Dawson J. thoroughly canvassed the concept of Crown immunity and the consequences of provincial implementation of legislationpertaining to proceedings against the Crown. She stated: 22 It is well known that specific rules apply when suing the Crown. Historically, the Crown was immune from suit. This is known asCrown immunity. Eventually, legislation was passed imposing tortious liability against the Crown in all Canadian jurisdictions.

TheCrown Proceedings Act of each province rendered the Crown in right of that province liable to be sued in its own provincial SuperiorCourts but not in the courts of other provinces (Horseman and Morley, Government Liability Law and Practice(Canada Law Book,2008), at pp. 12-22-12-23). This is referred to as provincial Crown immunity. She considered the similar but separate concept of sovereign immunity and the comments of Lord Denning in Mellenger v.

NewBrunswick Development Corp., [1971] 2 All E.R. 593, where he stated at 596: … The Crown is sovereign in New Brunswick for provincial powers, just as it is sovereign in Canada for dominion powers … It followsthat the Province of New Brunswick is a sovereign state in its own right, and entitled, if it so wishes, to claim sovereign immunity. [27] In Western Surety Co. v. Elk Valley Logging Ltd. (1985), (BC SC), 23 D.L.R. (4th) 464 (B.C.S.C.), the courtutilized the principle of sovereign immunity articulated in Mellenger to oust the jurisdiction of a court of one province over the Crown ofanother province.

However, the Alberta Court of Appeal in Athabasca held that sovereign or state immunity is a concept distinct fromCrown immunity. Hunt J.A., for the court, held that the claim for immunity inter-provincially is more properly defined as Crown

immunity. She stated: 55 In my view, the use of the Mellenger principle in an interprovincial context is misplaced. To the extent that the rationale underlying sovereign immunity has any importance in a federal state, that function is already fulfilled by Crown immunity.

The fact that some Canadian courts confuse the two concepts further suggests that they play the same role. [ 28 ] The characterization of immunity as either Crown or sovereign was not critical to the analysis of Dawson J. as becomes apparent by reference to the following paragraph of her decision: 27 As can be seen, Canadian courts have consistently recognized and confirmed the principle of provincial Crown immunity and/or sovereign immunity to conclude that provincial Crowns can only be sued in the courts of the Crown's own province, unless such immunity is modified by statute or unless the Crown gives consent. [ 29 ] With respect to the commercial activities exception to Crown immunity, Dawson J. rightly concluded that the alleged activity in question relates to health care.

As such, there is no element of commercial activity which would abrogate provincial Crown immunity. [ 30 ] There was no mention of the Charter argument in the decision of the chambers judge. It is doubtful whether it was put before her. In any event, I agree with Alberta that there is no violation of s. 7 since Alberta could have been sued in the courts of Alberta. In other words, a remedy exists or existed. The limitation period conundrum is not a reason to impose jurisdiction where none exists. A conscious litigation decision was made to launch the proceedings in Saskatchewan only.

If there are limitation period issues that is a consequence of that decision. [ 31 ] In

summary, I agree with the conclusions of Dawson J. and the submissions of Alberta on these points. In the result, I would not give effect to any of these grounds of appeal. 5. The chambers judge erred in law by not considering the issue of Saskatchewan’s real and substantial connection to the litigation, or questions of fairness, order and comity. [ 32 ] The appellants contend that the chambers judge erred in not considering this issue. Once again they rely on Morguard and Hunt and the academic writings previously referred to in support of their position.

Furthermore, the appellants reference the Queen’s Bench decision in Athabasca Chipewyan First Nation v. Canada (Minister of Indian Affairs and Northern Development) , 1999 ABQB 662 , 178 D.L.R. (4 th ) 245 as authority for the proposition that a court may consider the real and substantial connection of a defendant to the litigation even in the face of a jurisdictional challenge based upon Crown immunity.

The proposition that real and substantial connection trumps Crown immunity was rejected by the Alberta Court of Appeal in the subsequent appeal of Athabasca : 38 Both Morguard , but especially Hunt , were cases where the court of one province properly had assumed jurisdiction over the litigation. Here, in contrast, jurisdiction is the central issue. On that basis alone these cases are distinguishable. … 42 In my opinion, the principles of Morguard and Hunt have no application to Crown immunity questions, which are completely different than the procedural issues raised in those cases.

The result in this case is not unjust. No one seems ever to have contested that the litigation could have been brought in British Columbia. Indeed, it was. No explanation has been offered as to why the British Columbia suit did not proceed and there is no evidence to suggest that unfairness results from having to litigate in British Columbia. 43 Thus, the plaintiffs are not without a remedy.

The fact that their remedy lies in the courts of another jurisdiction because of decisions by a provincial Crown concerning the extent to which it will waive its traditional immunity does not breach the principles upon which our Constitution is based. On the contrary, it is fundamental to them. [2001 ABCA 112 , 199 D.L.R. (4 th ) 452 ] [ 33 ] At the risk of being repetitive, no authority was cited to support the proposition that the Crown immunity principle can be abrogated based upon the grounds of forum conveniens .

As well, there is no authority to support the appellants’ submission that Crown immunity should not apply in circumstances where multiple governments are allegedly “colluding or jointly liable”. [ 34 ] Alberta’s motion filed in Queen’s Bench referenced Rule 99(1) as the authority for a declaration that the Saskatchewan Court of Queen’s Bench lacks jurisdiction over Alberta. There was no reference in the motion to The Court Jurisdiction and Proceedings Transfer Act , S.S. 1997, c. C-41.1. As a result, the parties did not cast the issues in terms of that Act .

Nothing turns on this as the issue is whether the courts of this Province can assume jurisdiction over the Crown in right of another province, based on a test of real and substantial connection and the Alberta Court of Appeal in Athabasca answers that question conclusively.

[ 35 ] For these reasons I find that Dawson J. made no error when she declined to consider the real and substantial connection test or forum non conveniens . 6. The chambers judge erred in law in finding that the Alberta Proceedings Against the Crown Act does not permit actions against Alberta in other jurisdictions. [ 36 ]

Section 8 of the Alberta Act states: 8 Except as otherwise provided in this Act, all proceedings against the Crown in any court shall be instituted and proceeded with in accordance with the relevant law governing the practice in that court. [ 37 ] The appellants submit that this

section does not contain an express provision limiting jurisdiction for suits against the Crown to particular courts. The appellants referenced the Proceedings Against the Crown Act in other jurisdictions where the legislation expressly imposes such a limitation. For example, s. 10 of the Nova Scotia Act, R.S.N.S. 1989, c. 360 specifically states that “Nothing in this Act authorizes proceeding against the Crown except in the Supreme Court or a county court ” [emphasis added]. This provision makes it apparent that actions against Nova Scotia can only be launched in the courts of Nova Scotia.

The appellants posit that the phrase “relevant law governing the practice in that court” found in s. 8 of the Alberta Act means the law of Saskatchewan and The Court of Queen’s Bench Rules of Saskatchewan. Finally, the appellants submit that since there is no ambiguity in the legislation that the chambers judge did not have to reference Hansard to ascertain the

interpretation of s. 8. [ 38 ] Alberta submits that the chambers judge thoroughly reviewed the legislative history of s. 8 of the Alberta Act and properly rejected the claim of the appellants that it permits lawsuits to be brought against Alberta in other jurisdictions.

Furthermore, Alberta contends that the use of “any court” in s. 8 of the Alberta Act cannot reasonably be interpreted as an abandonment or waiver of the fundamental principle of Crown immunity and that any waiver, if in fact there is a waiver, must occur with clear and precise language. [ 39 ] The Alberta Court of Appeal in Athabasca , like Dawson J., thoroughly reviewed the history and purpose of s. 8 of the Alberta Act before concluding the

section cannot be read as to contain a clear and express waiver of Crown immunity. I find no fault with this analysis and would endorse the

interpretation placed upon s. 8 of the Alberta Act by Dawson J. Her conclusion bears repeating: 50

Section 8 of the Alberta Act leads to the inevitable conclusion that the Alberta Legislature intended that actions against Alberta can only proceed when brought in a court in Alberta. The Proceedings Against the Crown Act of Alberta does not open the door for an action against Alberta in another jurisdiction. 7. The chambers judge erred in awarding costs in an action commenced pursuant to the Class Actions Act . 8. The chambers judge erred in awarding costs against the appellants in accordance with Rule 173. [ 40 ] The Notice of Motion brought on behalf of Alberta in the Court of Queen’s Bench referenced both Rule 99(1) and 173(

a) of The Queen’s Bench Rules of Saskatchewan. These Rules read as follows: 99

(1) A defendant may apply to the court … to object to the jurisdiction of the court …

(2) On an application made pursuant to this rule, the court may make any order it considers just … 173 The Court may at any stage of an action order any pleading or any part thereof to be struck out, with or without leave to amend, on the ground that: (

a) it discloses no reasonable cause of action or defence, as the case may be; … Unless otherwise directed, the offending party shall pay double the costs to which the other party would otherwise be entitled.

[ 41 ]

Section 40 of the Class Actions Act addresses the issue of costs in class action proceedings as follows: 40(1) Subject to subsection (2), neither the Court of Queen’s Bench nor the Court of Appeal may award costs to any party to an application for certification pursuant to subsection 4(2) or

section 5, to any party to a class action or to any party to an appeal arising from a class action at any stage of the application, action or appeal.

(2) A court mentioned in subsection (1) may award costs to a party respecting an application for certification or respecting all or any part of a class action or an appeal from a class action if the court considers that: (

a) there has been vexatious, frivolous or abusive conduct on the part of any party; (

b) an improper or unnecessary application or other step has been made or taken for the purpose of delay or increasing costs or for any other improper purpose; or (

c) there are exceptional circumstances that make it unjust to deprive the successful party of costs.

(3) A court that orders costs may order that those costs be assessed in any manner that the court considers appropriate.

(4) Class members, other than the person appointed as representative plaintiff for the class, are not liable for costs except with respect to the determination of their own individual claims. [ 42 ] In paragraph 60 of the decision, Dawson J. stated: 60 … The plaintiffs' statement of claim is struck insofar as it relates to and as against Alberta. The within action against Alberta is dismissed with costs to Alberta as provided in Rule 173. (

a) Submissions of the appellants [ 43 ] The appellants maintain that the chambers judge erred in awarding costs. According to the appellants, Saskatchewan is a “no costs” jurisdiction and the costs awarded by Dawson J. contravene the express intention of the Legislature. The appellants also submit that even though this motion was heard prior to the certification application being filed, the “no costs” rule should be respected unless the Court makes a finding under s. 40(2) of the Class Actions Act . In any event, the appellants submit that double costs should not have been awarded as Dawson J. decided the matter pursuant to Rule 99 rather than Rule 173. (

b) Submissions of Alberta [ 44 ] Alberta submits that s. 40 of the Class Actions Act does not apply in the absence of threshold jurisdiction. With respect to whether double costs are in order, Alberta submits that its jurisdictional challenge was brought under both Rules. (

c) Discussion and Conclusion [ 45 ] I note that the British Columbia Court of Appeal and the Federal Court of Appeal have taken different approaches to resolve the issue of when a court may award costs in class action matters. Both s. 37 of the British Columbia Class Proceedings Act , R.S.B.C. 1996, c. 50 and Rule 334.39(1) of the Federal Courts Rules , SOR/98-106 are similar to s. 40 of the Class Actions Act . [ 46 ] In Seidel v.

Telus Communications Inc. , 2009 BCCA 383 , [2010] 3 W.W.R. 672 at para. 2 , the British Columbia Court of Appeal held that costs should follow the normal course when an action is not certified as a class action before the action has been stayed (see also Consumers' Assn. of Canada v. Coca-Cola Bottling Co., 2007 BCCA 356 at para. 12 ). In Campbell, et al. v.

The Attorney General of Canada, et al., 2012 FCA 45 at para. 33 , the Federal Court of Appeal held that once a certification motion is served and filed any person who is a party to the suit “is immune from costs with respect to any and all steps taken before and during the certification process.” [ 47 ] This Court does not need to settle the ambit of s. 40 or the specific issue raised by Seidel and Campbell because the result would be the same with respect to the within appeal regardless of the approach taken.

In the within appeal, the plaintiffs had not filed an application for certification before Alberta applied to have the motion struck for want of jurisdiction. In such a circumstance, both Seidel and Campbell lead to the same result, which is that s. 40 of the Class Actions Act does not apply. [ 48 ] There is, however, one aspect of Alberta’s application for costs that needs to be modified. Alberta’s motion in Queen’s Bench was brought pursuant to both Rule 99 (jurisdiction) and Rule 173 (no reasonable cause of action).

It is obvious from the decision of Dawson J. that the jurisdictional issue was decided in favour of Alberta. Dawson J. concluded that Crown immunity applied in this case and that the Saskatchewan Court of Queen’s Bench lacks jurisdiction over Alberta. In essence, the motion was determined on the basis of Rule

99. Rule 173 did not have to be considered and as a result it would be improper to award costs based upon Rule 173 which triggers double costs. [ 49 ] In both Eckel v. The City of Saskatoon et al. , 2009 SKQB 287 (per Koch J.) and Wall Estate et al. v. GlaxoSmithKline Inc. et al. , 2010 SKQB 351 , 367 Sask.R. 21 (per Popescul J., as he then was) the court struck pleadings upon the basis of jurisdiction under Rule 99 and found that they did not have to consider the alternate claim to strike under Rule 173.

I agree with this approach and would allow the appeal related to costs and deny the respondent costs in relation to its Rule 173 application. VII. Conclusion [ 50 ] The appeal is dismissed except for striking of any reference to Rule 173 in the costs award. Paragraph 6 of the order issued on March 24, 2010 will read: 6. The Plaintiff shall pay costs of this action to Alberta. [ 51 ] Alberta is entitled to costs of the appeal to be assessed in the usual way. DATED at the City of Regina, in the Province of Saskatchewan, this 25th day of April, A.D. 2012. “Herauf J.A.” HERAUF J.A.

I concur “Klebuc C.J.S.” KLEBUC C.J.S. I concur “Herauf J.A.” as authorized by JACKSON J.A.