Frances Court: Architects lose court application

IN THE SUPREME COURT OF BRITISH COLUMBIA

Citation:

Coast Foundation v. Currie,

 

2003 BCSC 1781

Date: 20031204
Docket: S74797

Registry: New Westminster

Between:

Coast Foundation Society (1974) and
British Columbia Housing Management Commission

Plaintiffs

And

John Currie Architect Inc., John Robert Currie,
Van Maren Construction Co. Ltd.,
Triwest Development Group Limited and
S.W. Technical Services Ltd.

Defendants

 

 

 

Before: The Honourable Mr. Justice Groberman

Reasons for Judgment

Counsel for the Plaintiffs

James M. Coady
Stella D. Frame

Counsel for John Currie Architect Inc. and John Robert Currie

Craig A. Wallace
Timothy L. Wong

Date and Place of Trial/Hearing:

September 11-12, 2003

 

Vancouver, B.C.

 

[1]            The defendants John Currie and John Currie Architect Inc. (collectively referred to in these reasons as the “Architects”) bring this application under Rule 18A.  They seek a ruling that some of the claims against them are barred by a limitation clause in a contract for architectural services.  The plaintiffs resist the application, arguing, firstly, that the issue ought not to be determined under Rule 18A, and secondly, that if it is determined, it ought to be determined in their favour.

[2]            The plaintiff Coast Foundation is a non-profit society dedicated to improving the lives of persons suffering from mental illness.  It operates a 34-unit apartment complex, known as Frances Court, constructed in 1988 and 1989 with the aid of funding from the plaintiff Commission.  The building has developed a leaky envelope and requires extensive repairs.  The defendants are the designers and builders of Frances Court.

The Issue Sought to be Determined

[3]            Mr. Currie was the designer of the apartment complex.  On September 6, 1988, he entered into a written agreement with the Coast Foundation in the “Canadian Standard Form of Agreement Between Client and Architect”.  That form of agreement is endorsed by the Committee of Canadian Architectural Councils, an umbrella organization made up of the professional associations of architects in each of the common-law provinces and the Royal Architectural Institute of Canada.  Clauses 3.9.1 and 3.9.6 of the contract read as follows:

3.9.1. … [T]he Client agrees that any and all claims which he has or hereafter may have against the Architect in any way arising out of or related to the Architect’s duties and responsibilities pursuant to this agreement (hereinafter referred to in this Article 3.9 as “claims” or “claim”), whether such claims sound in contract or in tort, shall be limited to the amount of $250,000.00 each claim ….

3.9.6  The Architect’s liability for all claims of the Client arising out of this agreement shall absolutely cease to exist after a period of six (6) years from the date of:

(a)      Substantial Performance of the Work,

and following the expiration of such period, the Client shall have no claim whatsoever against the Architect. ….

The plaintiff Commission has taken an assignment of the plaintiff Foundation’s rights under the contract.

[4]            The case at bar is, I am told, one of a number of cases involving leaky buildings constructed with funding from the plaintiff Commission and designed by architects under materially identical contracts.  While the current application is not a formal “test case”, it is apparent that the decision of the court in this case could affect a number of other actions, as well.

[5]            The six-year limitation period under clause 3.9.6 expired well before the plaintiff commenced this action.  If the clause is applicable to the plaintiffs’ claims, then the claims are barred.  The applicant defendants say that clause 3.9.6 encompasses both claims in contract and tort, and that it covers both the claims of the Foundation and the claims of the Commission insofar as they are based on an assignment of the Foundation’s rights.

[6]            The plaintiffs, on the other hand, argue that the clause is not broad enough to encompass claims sounding in negligence.  In the alternative, they argue that the building failures evidence a fundamental breach of the contract, and that therefore the Architects cannot invoke the limitation clause.

The Issue in the Context of the Litigation

[7]            The current application concerns only the interpretation and application of the limitation clause.  Even if I determine that issue, there are many matters – including matters between the plaintiffs and the Architects – that will remain outstanding.

[8]            Some of the issues that are outside the scope of the current application are largely factual, and could probably be resolved by the court with of a small amount of further evidence.  There is, for example, an issue as to whether any part of the plaintiffs’ claims arises out of pre-contractual negligence of the Architects, and whether the contractual provision bars such claims.  Similarly, there is an issue as to whether any claim arises out of a warranty inspection alleged to have been conducted by the Architects outside the scope of the contract.  There is also an issue as to whether John Currie Architect Inc. is a successor of John Robert Currie for the purposes of the contract.

[9]            Other issues are more complex – these include the claim of the plaintiff Commission that the Architects owe it a direct duty of care.  Any tort claim that the Commission may have against the Architects that does not arise by way of an assignment of the Foundation’s claims is beyond the scope of this summary trial.

[10]        Finally, the current application does not encompass the plaintiffs’ claims against the defendants other than the Architects.  This is particularly significant, as those other defendants allege contributory fault on the part of the Architects.  At trial, therefore, the court will have to assess the degree to which any damage is the Architects’ fault, even if the limitation clause absolves them of financial responsibility.

Rule 18A and the Determination of a Single Issue

[11]        Rule 18A allows a party to apply to the court for judgment, “either on an issue or generally”.  Rule 18A(8) and (11) set out the circumstances in which judgment may be given:

(8)   On an application heard before or at the same time as the hearing of an application under subrule (1), the court may

(b) dismiss the application under subrule (1) on the ground that

(i) the issues raised by the application under subrule (1) are not suitable for disposition under this rule, or

(ii) the application under subrule (1) will not assist the efficient resolution of the proceeding.

(11)  On the hearing of an application …, the court may

(a)  grant judgment in favour of any party, either on an issue or generally, unless

(i)   the court is unable, on the whole of the evidence before the court on the application, to find the facts necessary to decide the issues of fact or law, or

(ii) the court is of the opinion that it would be unjust to decide the issues on the application ….

[12]        A summary trial can serve as an efficient manner of disposing of issues or claims in appropriate circumstances.  Where the court has the entire claim before it on a summary trial application, it will generally endeavour to grant judgment unless credibility issues preclude the fair adjudication of matters on affidavit evidence.  There are, of course, exceptions.  Discoveries, for example, may not have progressed to the point where the court is satisfied that each side has had an opportunity to uncover all of the evidence that might be important to its case.  In such a case, it might be unjust to grant judgment: Bank of British Columbia v. Anglo-American Cedar Products Ltd. (1984), 57 B.C.L.R. 350 (S.C.).  The court will also decline to grant judgment where the complexity of the issues is such that the court is unable to absorb all of the evidence and legal argument in the compressed time available within the Rule 18A procedure: Chen v. Chen, 2002 BCSC 906, 22 C.P.C.(5th) 73.

[13]        The question of when the court ought to give judgment on an issue, as opposed to on the claim generally, is more complex.  The court is justifiably reluctant to decide cases in a piecemeal fashion.  In addition to all of the concerns that arise when the entire claim is before the court, there is a multitude of others.  The result is that the court must exercise considerable caution before coming to the conclusion that it should grant judgment on an issue in a summary trial.

[14]        Where a Rule 18A application requires determination of a difficult issue of law that might not need to be resolved in order to decide the claim at trial, for example, the court may conclude that the appropriate development of the common law demands restraint:  Bacchus Agents (1981) Ltd. v. Phillipe Dandurand Wines Ltd., 2002 BCCA 138, 164 B.C.A.C. 300.

[15]        The court must also be wary of making determinations on particular issues on a Rule 18A application when those issues are inexorably intertwined with other issues that are to be left for determination at trial: Prevost v. Vetter, 2002 BCCA 202, 210 D.L.R. (4th) 649; inter-relatedness of issues is not always obvious, and caution is necessary whenever a party seeks judgment on an issue as opposed to judgment generally under Rule 18A: B.M.P. Global et al v. Bank of Nova Scotia, 2003 BCCA 534, [2003] B.C.J. No. 2383.

[16]        It must be borne in mind that the primary purpose of Rule 18A is the efficient resolution of disputes.  Where the court does not consider that the determination of an issue under Rule 18A will assist in the efficient resolution of the dispute, it ought not to make the determination.

[17]        There are at least two aspects to be considered in gauging the efficiency of the summary trial process.  First, this court must be concerned about the allocation of its own resources: North Vancouver (District) v. Lunde (1998), 60 B.C.L.R. (3d) 201 at 212 (C.A.) (paragraph 33).  Summary trial applications that will not, even if successful, reduce the length of trial, should, in general, be discouraged.  The court must recognize the reality that judicial time is a scarce resource.

[18]        Second, the court must consider the efficiency of a partial determination from the standpoint of the litigation itself.  Piecemeal decision-making is rarely an efficient manner in which to resolve a dispute.  It raises the possibility of multiple appeals on individual issues, and this will generally impede rather than hasten the orderly determination of the action.

Ought this Issue to Decided on a Summary Trial

[19]        The issue presented by the Architects is an important one from their standpoint.  In my view, the evidence on this application is sufficient to determine it.  While there would be many issues outstanding even after the limitation issue was decided, I would not be dissuaded from making a determination simply because, even if I resolved the limitation issues, other issues would remain.

[20]        I am also of the view that the limitation issue, at least on its face, is not so closely related to the other issues in the litigation that it could not be decided in isolation.

[21]        I am, however, mindful that the raison d’être for Rule 18A is the efficient determination of claims.  While this court performs an increasing proportion of its work through the summary trial procedure, it remains the case that the trial process is generally more conducive to a full and just determination of disputes.  The summary procedure’s chief advantages are speed and efficiency.  Where the court is not convinced that the determination of an issue will be a speedy or efficient step towards resolution of the dispute, it ought not to accede to an application under Rule 18A.

[22]        In this case, neither party suggests that a determination of the limitation issue in a summary trial will reduce the total amount of court time needed to resolve the dispute.  There will be no reduction in the evidence presented at trial, and any reduction in the time needed for argument will be more than offset by the court time taken up in arguing the issue in the summary trial application.

[23]        The limitation issue is sufficiently important that it is virtually certain that an appeal would be taken – indeed, it is quite likely that an application for leave to appeal to the Supreme Court of Canada would be pursued after a judgment of the Court of Appeal.  In the meantime, the trial of the action will either be postponed, or proceed under an awkward uncertainty as to what issues will ultimately need to be decided.

[24]        The Architects argue that this court, by determining the limitation issue in advance of trial, will remove uncertainty, and facilitate settlement.  I have no doubt that a decision on the limitations issue would change the dynamics of settlement negotiations.  Whether it would facilitate or complicate settlement is a matter on which I can only speculate.  I accept that the court should, in appropriate cases, consider the prospect of settlement as a factor in determining whether to deal with a substantive issue on a Rule 18A application: Inspiration Management Ltd. v. McDermid St. Lawrence Ltd. (1989), 36 B.C.L.R.(2d) 202 (C.A.).  In many cases, however, it would simply be unjust to allow one party, over the objection of another, to have a single issue determined in advance of all others, in the hope that it will enhance its bargaining position.

[25]        In the present case, I am not persuaded that a determination of the limitation issue in advance of the trial would be an efficient procedure to follow.  Instead, it is more likely to result in a delayed trial, quite possibly with an awkward presentation of evidence and argument.

[26]        In the circumstances, I have concluded that determination of the limitation issue on a summary trial will not assist the efficient resolution of the proceeding.  In my view, it would be unjust to decide the limitation issue on this application.  The Architect’s motion under Rule 18A is dismissed; the limitation issue should be determined at trial.

“H.M. Groberman, J.”
The Honourable Mr. Justice H.M. Groberman