Engineers have specialized skill and knowledge on which their clients rely. When engineers are found to be professionally negligent, this relationship of reliance limits an engineer’s ability to shield themselves from liability by operating their business as a corporation. To consider why this is the case, we review several key decisions that create a duty of care between engineers and their firm’s clients.

Employee’s Liability

In London Drugs Ltd. v. Kuehne & Nagel International Ltd., 1992 CanLII 41 (SCC), the Supreme Court of Canada found that employees of a company, who performed the services for which their company has been hired to complete, may owe a duty of care to the company’s customer. That is, the individual employee may be liable for any damages arising from services they negligently perform on behalf of their employer. In the case, warehouse workers were found to have negligently handled the Plaintiff’s machinery resulting in significant damages. Because the Plaintiff’s contract with the Warehouse owner contained a limitation of liability clause which restricted recovery to $40, the Plaintiff sued the owner’s employees personally. The Supreme Court of Canada found that, although the employees owed a duty of care to the owner’s customers, the contract’s limitation of liability clause logically extended to the Owner’s employees, for they were the ones performing all of the contract’s enumerated tasks.

In the construction context, this principle of an employee’s liability arose in Edgeworth Construction Ltd. v. N.D. Lea & Associates Ltd., 1993 CanLII 67 (SCC). In the case, Edgeworth, the plaintiff company, was the successful tenderer on a provincial highway contract. Edgeworth claimed that it lost money on the project due to errors in the specifications and construction drawings prepared by the defendant engineers, N. D. Lea. Consequently, Edgeworth sued N.D. Lea and its individual engineers for negligent misrepresentation.

While the Supreme Court of Canada found that N.D. Lea was liable for negligent misrepresentation, it held that the firm’s individual engineers were not liable because they only affixed their professional seals to the impugned designs. Therefore, the Court found that the tenderers in the bidding process did not rely on any individual engineer’s representations because the seal merely represented that the designs were prepared by a qualified engineer, not that the designs were accurate. Since no representations were made by an individual engineer, there was no basis for finding that the engineers had a duty of care to the tenderers (viz. Edgeworth).

The British Columbia Court of Appeal considered the Edgeworth decision in British Columbia v. R.B.O. Architecture Inc., 1994 CanLII 1740 (BC CA) and in Boss Developments Ltd. v. Quality Air Maintenance Ltd., 1995 CanLII 3213 (BC CA). In Boss, Gibbs J.A. distinguished the case from Edgeworth on the grounds that the engineer did more than simply affix their seal to a design. Instead, the engineer signed a report indicating that an aircraft was properly maintained when it was not. Despite the fact that the engineer’s employer had the inspection contract with the customer, the engineer was found personally liable. Gibbs J.A. justified his finding by writing: “only an individual can be qualified as an aircraft maintenance engineer in this field of special skill and knowledge, … it is the individual mechanic who certifies [and] whose skill is being relied upon.”

Boss was applied and extended to a firm’s engineering employees generally in Maritime Steel and Founderies Ltd. v. Whitman Benn and Associates Ltd., 1996 CanLII 5415 (NS SC) and Strata Plan No. VR 1720 (Owners) v. Bart Developments Ltd., 1999 CanLII 5428 (BC SC). In both cases, the engineers did not simply attach their seals to tendering materials –as in Edgeworth—but rather, they provided negligent services to the plaintiffs directly.

Concerning an engineer’s personal liability, Edwards, J. wrote in Bart:
It cannot be plausibly argued that a limited company purporting to offer professional services of “consulting engineers” and indicating that its employees have special skill and experience is not inducing its clients to rely on those individuals’ expertise. It is immaterial whether the client can identify that expertise with individual employees of the firm.
In other words, engineering firms cannot perform engineering services without qualified employees. As such, the firm’s employees must know that their specialized skill and knowledge is being relied upon by the customer, and therefore, they owe a duty of care to their firm’s customers generally.

In conclusion, individual engineers working for an incorporated engineering firm are not shielded from liability by virtue of their employer’s corporate structure. Likewise, engineering firms may be held vicariously liable for the negligence of an employed engineer.

To limit their liability, engineers have four options:

First, they may contractually limit their liability for damages, e.g. to the amount of fees paid. Second, they may place disclaimers on their designs to prevent other parties from unreasonably relying on them. Third, engineers can increase their professional liability insurance coverage. And fourth, engineers can supervise the construction process to ensure their designs are properly constructed.

 

On September 1, 2020, British Columbia’s Arbitration Act, S.B.C. 2020, c. 2 (the “New Act”) came into force. The New Act introduces important amendments that aim to improve the efficiency of the Province’s arbitral process. This will improve commercial dealings by clarifying ambiguities in the previous legislation and creating greater uniformity in arbitrations laws nationally. To that end, the New Act closely resembles The Uniform Law Conference of Canada’s Uniform Act. In turn, the Uniform Act is a national project that strives to harmonize Canada’s arbitration laws with the United Nations’ UNCITRAL Model Law. Generally, these national and international model laws seek to limit judicial intervention in arbitral proceedings, and, thereby, create greater certainty in private dispute resolutions. The New Act strives towards this end as well.

The New Act introduces several important changes worth highlighting. First, Sections 21 and 22 impose a duty on the arbitrator and parties, respectively, to seek a “just, speedy, and economical determination of the proceeding based on its merits.” This explicit focus on the timely and economic resolution of disputes is the principle that underpins all of the New Act’s reforms. Appeals, for instance, are sent directly to British Columbia’s Court of Appeal on questions of law (s.59). Likewise, the time period for appealing an arbitral award or setting it aside due to an apprehension of bias has been shortened from 60 to 30 days (s.60).

In further regards to time limits, section 11 of the New Act reads: “the law with respect to limitation periods for commencing court proceedings applies to commencing arbitral proceedings.” This provision was absent from the previous legislation, creating an ambiguity because British Columbia’s Limitation Act, SBC 2012, c 13, does not specify that it applies to arbitrations and it contains court-centric language. Consequently, it is now clear that parties to an arbitration agreement will have two years from the date that they knew or ought to of known they have a potential claim against another party to pursue arbitration or their claim will be statute barred.

Arbitrators now have expanded authority.  Section 23 of the New Act empowers arbitrators to rule on their own jurisdiction. Where this power is exercised as a preliminary matter, either party may refer the issue to the Supreme Court of British Columbia within 30 days of receiving notice of the arbitrator’s ruling for a re-determination. In exercising their jurisdiction, arbitrators are now permitted under section 25 of the New Act to apply equitable principles, whereas the previous legislation limited their authority to the application of statutory law.

Turning to procedures, the New Act no longer specifies default rules. The British Columbia International Commercial Arbitration Centre’s rules (“BCICA”) previously applied by default, unless the parties agreed otherwise. While the New Act removes any reference to the BCICA’s rules, it has incorporated some of their key elements. For example, section 29 allows arbitrators to subpoena non-party witnesses. Where parties have not specified and cannot agree on the applicable rules, arbitrators appear to have discretion under section 32 to make procedural orders that could include the selection of arbitral rules.

Where the parties cannot agree on an arbitrator, the selection is made by the legislation’s designated appointing authority. Under section 2 of the New Act’s attendant Arbitration Regulation, BC Reg. 160/2020, this appointing authority is the Vancouver International Arbitration Centre (“VIAC”).[1] Previously, such appointment disputes were resolved by application to the British Columbia Supreme Court. By creating the VIAC, the New Act increases efficiency by reducing arbitrations’ reliance on the courts. In addition, the VICA can set arbitrators fees and impose terms on awards whenever an arbitrator’s fees remain unpaid.

Finally, the New Act introduces three other significant changes that were previously absent from the legislation. First, a witness’s evidence is to be written, unless otherwise agreed to by the parties. Oral evidence is limited to cross-examinations. Second, section 68 requires confidentiality. The parties may not disclose information about the proceeding or its outcome. Third, arbitrators may grant interim orders, even on an ex parte basis. However, these orders do not constitute an arbitral award, nor are they enforceable in the courts.

The New Act applies to all arbitral proceedings commenced on or after September 1, 2020. However, it does not apply to proceedings that fall within the jurisdiction of the International Commercial Arbitration Act, RSBC 1996, c 233, nor does it apply to family law matters.

[1] The BCICA was re-branded as the VIAC.

The Covid-19 pandemic has generated significant market volatility. Investors must assess risk and consider whether the investment portfolio should be diversified to reduce risk exposure in an unpredictable market. Trustees who have Trust Property invested in the market are faced with additional obligations that can make protecting Trust Property challenging. Trustees must comply with the terms of the Trust Property as well as the legislation governing trusts. In BC, the legislation governing trusts is the Trustee Act (the “Act”).

 

Pursuant to section 15 of the Act, a Trustee may invest property in any form of property or security in which a Prudent Investor might invest. The Trustee is under an obligation when investing Trust Property to exercise the care, skill, diligence and judgment that a Prudent Investor would exercise in making investments. The Trustee is not liable for a loss to the trust arising from the investment of Trust Property if the Trustee reasonably assessed the risk and return and acted as a Prudent Investor.

 

Unlike other provinces, BC does not expressly impose an obligation to diversify investments. However, the Prudent Investor standard implicitly requires the Trustee to assess whether diversification is necessary to reduce risk exposure. The Prudent Investor standard was considered in Miles v Vince, 2014 BCCA 289 [Miles]. The issue on appeal was whether the Trustee was under an obligation to diversify the investment portfolio.

 

In Miles, the Beneficiary claimed the Trustee should have diversified the Insurance Trust’s assets. The Trustee argued she was under no statutory obligation to diversify the investment portfolio. The Court concluded that the Trustee had breached her statutory duty to prudently invest Trust Property pursuant to section 15.2 of the Act. A Prudent Investor must consider the investment portfolio’s risk and whether diversification in necessary to protect the assets. To the contrary, the Trustee had invested the Insurance Trust’s assets into one illiquid asset that put the Trust’s assets at risk. The Trustee had failed to protect the interests of all the beneficiaries of the trust. As a result, she was removed as Trustee. Pursuant to section 31 of the Act, the Court has power to remove and appoint a new Trustee.

 

In another case, Pestano v Wong, 2019 BCCA 141, the Court stated the definition of a Prudent Investor has evolved to mean:

 

  • Making necessary investments that a Prudent Investor would make to protect capital and provide income;
  • Developing risk and return objectives that are reasonable and suitable, given the size of the overall portfolio, and the circumstances of the investor;
  • Ensuring reasonable diversification of the type and class of investments;
  • Acting with prudence when delegating investment authority to an agent;
  • Incurring only reasonable and appropriate costs; and
  • Adopting a balanced approach to management investments

 

Trustees have significant responsibility when investing Trust Property. With the current level of market volatility, it is important to consider whether an investment portfolio should be diversified to reduce the Trust Property’s risk exposure. Heath Law LLP can help you with any questions concerning Trust Property and the Prudent Investor Standard.

 

 

British Columbia offers various home and community care services to individuals requiring assistance with day-to-day life due to health issues or illness. Individuals living in Long-Term Care Homes and Assisted Living Residences are some of British Columbia’s most vulnerable members of society. Long-Term Care Homes provide 24-hour care to elderly residents. Residents in Long-Term Care Homes often have mobility issues or dementia or require palliative care. Assisted Living Residences provide housing units to residents who require daily assistance but can live independently. Residents can be assisted with eating, dressing, bathing, and managing medication, among other things. Assisted Living Residences do not provide 24-hour care.

BC offers private and publicly subsidized Long-Term Care Homes and Assisted Living Residences. In publicly subsidized Long-Term Care Homes, residents pay a monthly charge of 80% of their after-tax income. In publicly subsidized Assisted Living Residences, residents pay a monthly charge of 70% of their after-tax income. The majority of Long-Term Care Homes and Assisted Living Residences in BC are run by private for-profit companies. In 2016, only 2.4% of the Assisted Living Residences were owned by public health authorities, while 53.1% were owned by for-profit companies and 44.5% were owned by non-profit organizations. In private for-profit Long-Term Care Homes and Assisted Living Residences, residents pay the full cost. If residents require additional services, they must pay an additional fee. Unfortunately, many residents cannot afford to pay for additional services to suit their individual needs.

British Columbia has many laws governing the health, safety, and quality of care for seniors living in Long-Term Care Homes and Assisted Living Residences. The Community Care and Assisted Living Act provides a Bill of Rights to residents in Long-Term Care Homes and Assisted Living Residences. The Bill of Rights provides the resident with:

 

  • Commitment to a care plan developed specifically for the individual
  • Rights to health, safety and dignity
  • Rights to participation and freedom of expression
  • Rights to transparency and accountability

 

Last year, Island Health took over the emergency management of three private for-profit Long-Term Care Homes on Vancouver Island due to complaints of staffing shortages and neglect of the residents. Since Island Heath took over the Long-Term Care Homes, improvements have been made to training staff, creating new staff positions and to purchasing necessary equipment and supplies.

A class action on behalf of a group of residents from Long-Term Care Homes in BC has been brought against the company that owns the Long-Term Care Homes, an investment company, and BC’s Ministry of Health. The class of residents allege “abuse, neglect and mistreatment” (Huebner v PR Seniors Housing Management Ltd, DBA Retirement Concepts, 2020 BCSC 1037). The certification hearing is scheduled to take place no later than June 2021.

Heath Law LLP can help you if you or a loved one have experienced neglect in a Long-Term Care Home or Assisted Living Residence.

What happens if you have been bitten by a dog? What are the legal consequences for the dog owner? In British Columbia, a plaintiff who has been bitten by a dog can establish liability against the dog owner under the scienter doctrine, through negligence, or pursuant to the Occupiers Liability Act.

Under scienter, the law has developed to allow dogs “one bite free”. This is because it must be proven that the dog has a propensity for aggression. The law presumes that dogs are not naturally dangerous and that an owner should not be liable for the dog’s aggressive behaviour unless the owner was aware of such aggressive behaviour.

 Scienter places strict liability on the dog owner only if the plaintiff can establish the following three components:

  • the identity of the dog owner;
  • the dog had manifested a propensity to attack or bite mankind; and
  • the dog owner knew of their dog’s propensity.

The Court applied scienter in Prasad v Wepruk, 2004 BCSC 578 [Prasad]. In Prasad, a 77-year-old mailman was viciously attacked by a bouvier dog. The Court used the testimony of neighbours as evidence to determine that the dog had a propensity for aggression by appearing vicious while snarling and growling at the neighbours when they passed by. The Court concluded that the owner had knowledge of this propensity. As a result, the dog owner was liable.

If a plaintiff cannot establish the three requirements for scienter, the plaintiff can establish negligence on the part of the dog owner or the owner of the property where the injury took place if the plaintiff can prove:

  • the dog owner knew or ought to have known that the dog was likely to injure someone; and
  • the dog owner failed to take reasonable steps to prevent the injury.

In other words, was the dog attack reasonably foreseeable? In many cases, the courts determine the dog’s action was unexpected or that there was no evidence of the dog’s past aggression.

An action for damages may also be brought by a plaintiff pursuant to the Occupiers Liability Act. Similar to negligence, the plaintiff must establish that the dog owner or property owner knew or ought to have known that the dog was likely to be a risk, and that the owner failed to take reasonable steps to prevent such risk.

Other provinces have stricter laws respecting dog bites. In Ontario, once ownership of the dog is proven, the owner is liable for all injuries caused by the dog regardless of the owner’s knowledge of their dog’s aggressive propensity. In 2006, stricter laws were proposed in BC. The proposed laws would have removed the knowledge requirement, essentially making the scienter doctrine inapplicable. However, these laws were not passed. Thus, the “one bite free” principle prevails in BC.

Ski-hill Lift Tickets – Liability, Unilateral Contracts, Negligence Exclusion

In certain situations, such as obtaining a lift ticket for a ski-hill, “unilateral contracts” are used by one of the parties to the contract (i.e., the ski hill) which set out specific conditions the other party (i.e., the consumer) must accept if the consumer wants to proceed with using the ticket.  Are all the terms and conditions of these unilateral contracts binding on the consumer even if the consumer did not sign or have any part in the formation of the contract?

A recent case from the British Columbia Court of Appeal (“BCCA”) Apps v. Grouse Mountain Resorts Ltd., 2020 BCCA 78 [Apps] addressed the requirements for unilateral contracts to be binding when the consumer does not sign a contract.

The unfortunate facts of Apps are as follows.  The plaintiff was a snowboarder who became a quadriplegic after attempting a large jump at Grouse Mountain in Vancouver, BC.  The plaintiff was an Australian who was living, working and snowboarding in Whistler, he was only 20 at the time of his injury.

The plaintiff alleged that the jump was negligently designed, constructed, maintained and inspected by Grouse Mountain. Grouse Mountain, in defence, relied on an exclusion of liability waiver which it said constituted a complete defence. The British Columbia Supreme Court (“BCSC”) dismissed the plaintiff’s action. The BCCA overturned the BCSC’s decision.

The type of waiver Grouse Mountain was relying on was an “own negligence exclusion”.  This type of exclusion not only excludes liability for the risks inherent in the use of Grouse Mountain’s product or service, but also liability for negligence caused by Grouse Mountain itself.

The BCCA stated that “own negligence exclusions” are among the more onerous conditions to be placed into contracts, meaning that for Grouse Mountain to rely on the exclusion it must have taken reasonable steps to bring the exclusion to the attention of the Plaintiff.

The BCCA concluded that not enough had been done by Grouse Mountain to bring the “own negligence exclusion” to the plaintiff’s attention before he entered into the contract. The exclusion was included in a posted sign above the counter where the lift tickets were sold, but the text was difficult to read, and the “own negligence exclusion” was not emphasized.  This would be considered the pre-contractual notice (before the ticket was purchased).  Post-contractual notice (after the ticket was purchased) of the “own negligence exclusion” appeared on the back of the lift ticket and on a sign in the terrain park.  The BCCA concluded that post-contractual notice has no bearing on whether Grouse Mountain gave sufficient notice to the Plaintiff.

Grouse Mountain also attempted to rely on the plaintiff’s knowledge of the presence of these types exclusions due to his previous employment at Whistler and having signed such an exclusion for his Whistler’s Season Pass.  The BCCA found that the plaintiff’s previous experience with “own negligence exclusions” from his experiences at Whistler did not mean he had actual knowledge of Grouse Mountain’s specific clause.

The BCCA therefore overturned the BCSC decision and allowed the plaintiff to continue his action.

For businesses that are concerned about what proper notice would look like, the BCCA provided some indicators of proper notice.  To rely on any type of waiver which will result in the consumer losing legal rights, a service provider should, before contract formation, ensure that the “own negligence clause” is clearly brought to the attention of the consumer by using large, colorful and bold text and literally mention the “own negligence clause” to the consumer.

Confidentiality of Medical Records

You have recently been injured due to another person’s negligence (the “Incident”). The injuries are ongoing and starting to affect your daily living. You are considering starting a lawsuit but are hesitant because of a story you heard from your friend when they started a lawsuit. The friend told you that all of their personal information was no longer private, even the conversations they had with their doctor.

The truth of the matter is that the legal process is both private/confidential as well as public. The confidential portion of the legal process is that information you share is only made available to your lawyer and the opposition’s lawyer. There are very strict rules controlling lawyers and how they deal with information provided to them by clients. The public aspect arises if a lawsuit goes to trial, the public is at liberty to watch the trial and read any decisions that a judge makes with regard to the lawsuit. Quite often, especially in cases involving personal injury, one’s medical information becomes relevant and therefore potentially available to the public.

When it comes to medical reports not all of one’s medical history is necessarily relevant. A lot depends on the nature of the lawsuit one brings. For example, if from the Incident you are claiming that an injury to your arm is affecting your livelihood, then medical records pre-dating the Incident that relate to your arm should be disclosed.

The reason your medical history is disclosed is because it is necessary during the legal process to determine how much the Incident actually contributed to your current ailments.

The courts will always try to balance the privacy interests of plaintiffs against necessary document disclosure to ensure a fair trial. Only medical records that are considered relevant should be disclosed.

Has Someone Failed to Pay You?

The following will outline some basic information for recovering money owed to you under a contract.

The first thing that must be considered is the likelihood of recovering the debt owed.  It is important to remember that just because someone owes you money, it does not mean that they necessarily have the ability to pay you.  It is important to weigh and consider the amount owed to you versus the time and costs of recovery.

The next thing to consider is the limitation period for collecting the debt.  Generally speaking, the limitation period for an action in debt is two years after the claim is discovered.  A claim is discovered when one knew or ought reasonably to have known that injury, loss, or damage had occurred.  If one fails to bring a claim within the limitation period that claim becomes time barred. Note that there is a special rule contained in the Limitation Act as to when a claim on a demand loan is discovered. A demand loan is discovered on the first day there is a failure to perform the obligation after a demand for the performance has been made (s. 14).

Following a determination of the likelihood of recovery and ensuring there is compliance with the limitation period, a demand letter should be sent to the debtor.  This demand letter should outline the name of the creditor, the amount of the debt and the authority of the creditor to collect the debt.  It should also be noted that some contracts provide that a demand has to have been made before any legal action is commenced.

If no payment is received as a result of sending the demand letter it may be advisable to pursue legal action against the debtor.

Before legal action is commenced, one important consideration is which court to sue in.  In BC, there are three different levels of court one can use to recover money owed to them.  The decision as to which court to elect usually comes down to the amount of money the debtor owes.

The three courts are as follows, the Civil Resolution Tribunal (“CRT”), Small Claims Court and Supreme Court.  The CRT has a monetary cap of $5,000, the Small Claims Court has a monetary cap of $35,000 and there is no cap for Supreme Court.

After court election and assuming you are successful and achieve a judgment against the debtor, the method and availability of executing on that judgment is crucial.  It is possible that you go through the entire legal process and receive nothing because the debtor has no exigible property (property that can be realized on).  This is why it is very important at the initial stage to determine whether or not the debtor has the ability to pay.

The common methods of realizing on a judgment for a debt are through seizing and selling the debtors personal property, registering the judgment against the debtor’s real property or through garnishment (a process by which money owed to the debtor gets paid to you instead).

If you would like legal advice with regard to collecting money owed to you, please contact Heath Law LLP at 250-753-2202 or toll free: 1-866-753-2202.

 

“This contract represents the entire agreement between the parties. The contract supersedes all prior negotiations, representations or agreements, either written or oral, including the bidding documents.”

This clause, or something similar to it, is known as an entire agreement clause. It is often included within commercial contracts to limit the parties’ liability to the contract’s four corners. In other words, it prevents one party from asserting that the other breached a contractual promise made but not recorded within the contract. This creates legal certainty by lifting the final contract out of the messiness of negotiations. However, there are several circumstances where entire agreement clauses will not be strictly applied.

Where the parties are sophisticated or where they have legal representation during the contract’s negotiations, an entire agreement clause may be strictly enforced.[1] Where there is an asymmetry of bargaining power between the parties, however, the entire agreement clause must have been brought to the weaker party’s attention prior to the contract’s formation.[2] Following from this reasoning, courts have held that an entire agreement clause within a standard form contract will be given less weight; this is because the parties are less likely to have read and understood the clause’s meaning.[3]

Entire agreement clauses will not necessarily prevent a party from suing for negligent misrepresentation of terms not included within the contract. Between sophisticated parties or parties with legal representation, the Supreme Court of Canada has held that protection from liability for negligent misrepresentation is implicitly included within an entire agreement clause.[4] For unsophisticated or unrepresented parties, the possibility remains open. That is, they may sue the other party for breaching a representation made prior to but excluded from the final written contract. Such lawsuits are especially likely to succeed where that representation induced them to enter the contract.[5]

Finally, entire agreement clauses will not shield parties from liability for acting in bad faith. In the 2014 decision of Bhasin v. Hrynew, the Supreme Court of Canada created a new common law duty of honest performance in contracts.[6] Parties cannot use an entire agreement clause to contract out of this duty. Therefore, fraudulent misrepresentations during a contract’s formation will always remain actionable.

If you’re entering a commercial contract be mindful of the entire agreement clause and its effect on any representations the other party has made to you during the negotiations. For more information please call our office at (250) 753-2202.

 

[1] No. 2002 Taurus Ventures Ltd. v. Intrawest Corp., 2007 BCCA 228; Power Consolidated (China) Pulp Inc. v. British Columbia Resources Investment Corp., [1989] B.C.J. No. 114 (B.C.S.C.).

[2] Zippy Print Enterprises Ltd. v. Pawliuk, [1995] 3 W.W.R. 324.

[3] Turner v. DiDonato, 2009 ONCA 235, at para. 46; Wright v. 2137737 Ontario Inc., 2010 ONSC 2956;

Parkland Industries Ltd. v. Smart Gas and Auto Detailing Ltd., 2013 BCSC 1046.

[4] Bow Valley Husky Ltd. v. St. John Shipbuilding Ltd. [1997] 3 SCR 1210, 1997 CanLII 307 (SCC)

[5] Tilden Rent-A-Car Co. v. Clendenning, 1978 CanLII 1446 (ON CA)

[6] 2014 SCC 71

Can parents be held legally responsible for their children’s negligence? Yes. Under B.C.’s Parental Liability Act (PLA), “if a child intentionally takes, damages or destroys property of another person, a parent of the child is liable for the loss of or damage to the property experienced as a result by an owner and by a person legally entitled to possession of the property.”[1] The maximum liability for parents is $10,000. However, a parent can defend themselves from the lawsuit by demonstrating that they were exercising reasonable supervision over the child, and that they made reasonable efforts to prevent or discourage the child from damaging someone’s property.[2] The PLA effectively codifies the existing legal tradition (i.e. the common law). As such, this post will briefly review the common law to clarify the reason for parental liability, and it will explain this reason’s associated standard of supervision as a limiting factor to liability.

At common law, a parent cannot be held liable for damages resulting from their children’s negligent acts (i.e. their tortious conduct). In the 1860 English case of Moon v Towers the court held that “a father is not liable in damages for the torts of his child.” This principle has been applied in numerous B.C. cases.[3] In Hatfield v. Pearson, for example, three teenaged boys stole a car which was damaged in the ensuing police chase. The owner’s claim for damages against the children’s parents failed on the principle set out in Moon v Towers. Similar dismissals have arisen in response to children’s acts of vandalism,[4] arson,[5] and murder.[6] However, parents with unruly children should not take too much comfort in this knowledge, for the rule is not absolute.

Parents have a personal duty to supervise their children.[7] When careless in this duty, a parent can be held liable for any resulting damages. There is a subtle but important difference here. The parent is not vicariously liable for their child’s negligence; rather, they are personally liable for their prior negligence in not properly supervising their child to the acceptable standard of preventing foreseeable harm to others. In the 1994 B.C. Supreme Court Case of Poirier (Guardian of) v. Cholette, for instance, parents were held liable for failing to properly supervise their two adolescent boys while they wrestled on a trampoline with friends, resulting in the breakage of a young girl’s arm. As the court wrote: “had the defendants provided proper supervision, the prohibited circumstances of three or four children indulging in horseplay and wrestling on the trampoline would not have occurred.   The infant plaintiff would, on a balance of probabilities, not have fallen.”[8] Of course, this foreseeability of harm changes with the child’s age. As the child nears the age of majority (18 years old) and expectations regarding their comportment with social standards increase, the parents’ duty to supervise will correspondingly decrease.[9]

If the child demonstrates a propensity for the negligent behavior that eventually resulted in damage, the parents’ duty to supervise is increased. In the B.C. case of M.I.M. v. T.H., for example, a foster parent was found to have fulfilled such an elevated standard arising from his knowledge regarding his two foster children’s proclivity for stealing. But, their eventual arson attack was unforeseen, and therefore, the foster parent could not be held liable.[10] In other words, the supervision standard is limited to what a reasonably prudent parent would do in similar circumstances.

An “error in judgment” will not amount to negligent supervision. That is, the reasonable parent standard is broad, insofar as any circumstance will afford various courses of reasonable action. Even when one of those actions has an unfortunate outcome, its mere selection will not amount to negligence. In Arnold v. Teno, for example, the Supreme Court of Canada found that a mother allowing her children to cross a residential street to purchase items from an ice cream truck was within the community standard, even though that choice later resulted in one of the children being struck by a vehicle. While an instance of poor judgment, the decision did not amount to a failure to supervise.

Taken together, parents cannot be vicariously liable for their children’s negligent acts. Yet, they may be liable for failing to supervise their children to the appropriate community or circumstantial standards. The PLA’s codification of these common law principles bridges the distinction between vicarious and parental liability. It simply makes parents liable for their children’s negligence. However, the distinction implicitly persists with the statute’s supervision defence. Also, it should be noted that the PLA maintains a $10,000 liability limit that does not exist at common law. That said, other statutes also override the Moon v. Towers principle and impose parental liability in certain circumstances. Section 10 of B.C.’s School Act, for example, imposes liability on parents for any damage their children cause to school property.[11] There, the statue sets no upper limit on parental liability.

[1] Parental Liability Act, Part 2, s. 3

[2] Ibid., ss. 9 & 10

[3] Moon v. Towers (1860), 8 C.B.N.S. 611, 141 E.R. 1306; also see, The Law Reform Commission of Ireland, Report On The Liability In Tort Of Minors And The Liability Of Parents For Damage Caused By Minors Ireland, <https://www.lawreform.ie/_fileupload/Reports/rDamagecausedbyMinors.htm>

[4] M.I.M. v. T.H., [1991] 5 WWR 699, 82 DLR (4th) 609, 57 BCLR (2d) 1.

[5] Smith v. British Columbia, 1997 CanLII 3267 (BC SC),

[6] D.L. et al. v. C.P. et al., 2019 MBQB 42

[7] Arnold v. Teno, [1978] 2 S.C.R. 287; Hatfield v. Pearson (1956), 6 D.L.R. (2d) 593 (B.C.C.A.)

[8] Poirier (Guardian of) v. Cholette, 1994 CanLII 1182 (BC SC)

[9] Lelarge v. Blackney, (1978) 92 D.L.R. (3d), 440 (N.B.C.A.) at pp. 446-7.

[10] M.I.M. v. T.H., 1991 CanLII 5722 (BC CA), at para 138.

[11] School Act, RSBC 1996, c 412, s 10; also see School District No. 43 (Coquitlam) v. T.W.D., 1999 BCCA 95