Docket: T-1698-16
Citation:
2018 FC 39
Ottawa, Ontario, January 16, 2018
PRESENT: The
Honourable Mr. Justice Manson
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BETWEEN:
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THE
ADMINISTRATOR OF THE SHIP-SOURCE OIL POLLUTION FUND
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Plaintiff
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and
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ROBIN BEASSE
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Defendant
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AND BETWEEN:
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ROBIN BEASSE
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Plaintiff by Counterclaim
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and
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HER MAJESTY THE
QUEEN IN RIGHT OF CANADA, SQUAMISH MARINE SERVICE LTD. AND CHRIS TAMBURRI
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Defendants by Counterclaim
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and
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VALLEY TOWING
LIMITED
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Third Party
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JUDGMENT AND REASONS
[1]
This is the Plaintiff’s motion for summary
judgment and expenses incurred during a pollution clean-up, due to the sinking
of a tugboat near Squamish, British Columbia, in the amount of $82,512.70, plus
pre-judgment and post-judgment interest at 3% from January 14, 2014, to the
date of payment, pursuant to Rules 213, 216 and 218 of the Federal Courts
Rules, SOR/98-106 [Federal Courts Rules] and sections 77, 103, 105,
106 and 116 of the Marine Liability Act, SC 2001, c 6 [MLA].
I.
Background
[2]
The tugboat “Elf”
(the “Tug”) was built in 1902 and registered in the United States, but never
registered in Canada. It was purchased in October, 2012, by Christine Beasse,
wife of the Defendant Robin Beasse, and subsequently purchased by the Defendant
from his wife.
[3]
In January 2014, the Tug was moved alongside a
barge, owned by Mr. Steen Larken, in Mamquam Blind Channel, Squamish,
British Columbia.
[4]
The Tug sank on January 14, 2014, and caused
pollution (the “First Sinking”). The Defendant became aware of the sinking that
morning. He had not seen the Tug for between seven to fourteen days prior to
the sinking.
[5]
At the time of the First Sinking, there was no
electrical connection to shore power.
[6]
The Canadian Coast Guard (“CCG”) was notified of
the First Sinking early in the morning of January 14, 2014, and responded to
deal with pollution from the Tug. They placed a boom around where the oil was
upwelling from the sunken Tug and applied absorbent pads inside the boom.
[7]
Although the Defendant knew on January 14, 2014,
that the Tug had sunk, was aware that there were two large fuel tanks in the
Tug and knew it had caused pollution, he did not respond on that day to address
the pollution, as the CCG was dealing with the oil spill and he had no
experience or equipment to deal with it.
[8]
The CCG advised Mr. Larsen that all pollution
remediation costs would be the responsibility of the owner of the Tug.
Notwithstanding the Defendant’s ownership of the Tug, Mr. Larsen misrepresented
to the CCG that he owned the Tug.
[9]
Mr. Larsen was advised that there would be
meetings every evening to discuss efforts to deal with pollution. He attended
the first meeting on January 14, 2014, but left the meeting after advising that
he would not have divers available on January 15, 2014.
[10]
On January 15, 2014, the Defendant met with Mr.
Philip Murdock of the CCG at the site of the sinking but did not identify
himself as the owner of the Tug. He left it to the CCG to deal with the
pollution rising from the Tug.
[11]
Mr. Larsen told the CCG that he and the
Defendant were not going to hire a contractor to clean-up the oil.
Subsequently, neither the Defendant nor anyone representing him did anything in
respect of cleaning-up the oil or dealing with the consequences of that
pollution.
[12]
As the person whom they believed at that time to
be the owner (Mr. Larsen) was doing nothing about the pollution, the CCG
retained divers and a barge with a large crane aboard (the “Delcat”) to attend
from Vancouver to lift the Tug on January 16, 2014. The barge arrived in the
morning of January 16, 2014; the divers placed slings around the Tug and
prepared to lift the Tug.
[13]
Subsequent to the CCG preparing to lift the Tug,
the Defendant and Mr. Larsen tried to convince the CCG to stop the lift;
however, given that all arrangements to lift the Tug were completed, the CCG
proceeded with the lift and then dewatered the Tug. At no time did Mr. Larsen,
or anyone acting on their behalf, do anything to contain, minimize, or clean-up
the pollution from the Tug.
[14]
The Defendant has raised the sole defence that
the small aft door (the “Door”) to the superstructure on the Tug was torn off
its hinges and that this is evidence that a third party broke into the Tug and
caused the sinking. However, the Defendant also admitted that removal of the
Door would not have caused the sinking.
[15]
Very shortly after the Tug was raised, the Door
was taken by the Defendant and Mr. Larsen and wasn’t altered before it was
delivered to Mr. J. Spears, who was then the lawyer for the Defendant.
[16]
The Door was produced by Mr. Spears for
inspection by all parties on May 17, 2017. It was undamaged except for one
hinge. The deadbolt locking mechanism of the Door was retracted or unlocked.
The hasp on the hatch above the Door, which can be locked down to the staple on
the Door, was intact, as was the staple on the Door.
[17]
The divers inspected the hull before and after
the Tug was raised and could find no reason for the sinking. After the Tug was
raised and dewatered, it was inspected by Mr. J. Small, a surveyor on behalf of
the CCG, by Mr. D. Holonko, a surveyor on behalf of the Plaintiff, and by the
Defendant and Mr. Larsen. None of the parties inspecting the hull found damage
to the hull or any other reason the Tug sank.
[18]
The Defendant was aware that the superstructure
around the Door was seriously rotted.
[19]
After the Tug was inspected by all parties at
Mamquam Blind Channel, it was towed a short distance to Watts Point (Shannon
Falls) where it was again inspected by Mr. Holonko and a representative of the CCG,
neither of whom could ascertain any damage to the hull or ingress of water that
caused the sinking.
[20]
After the Tug remained at Watts Point, it was
towed behind the Delcat to a location just off Point Atkinson, where it was
handed over to another tugboat operated by Valley Towing Ltd. (“Valley”). At
the time of the handover, on January 17, 2014, the Tug appeared to be floating
normally and there was no indication of ingress of water.
[21]
Shortly after the Tug was handed over to Valley,
it sank rapidly into deep water (the “Second Sinking”).
[22]
Mr. Holonko opined that both the First and Second
Sinking were caused by the failure of fastenings, or the failure of the wood
around the fastenings, allowing a plank on the hull to spring open.
[23]
The Plaintiff and the CCG’s position is that the
First Sinking occurred spontaneously and given that the MLA is a strict
liability statute, the only way for the Defendant to avoid liability is to
establish on a balance of probabilities that the sinking was caused by the
deliberate action of a third party.
[24]
The CCG presented a claim for their incurred
expenses to the Plaintiff on August 12, 2014. After investigation and
assessment of the CCG claim, the Plaintiff paid to the CCG $82,512.70, plus
interest pursuant to section 116 of the MLA of $6,190.22, for a total of
$88,702.92, on August 4, 2016.
[25]
Since August 4, 2016, the further interest to
October 31, 2017, amounts to $3,299.70, with interest from November 1, 2017, at
3% or $7.29 per day.
[26]
The Defendant argues that this is not an
appropriate case for a summary trial, due to the circumstances of the Second Sinking.
While the investigation was at its early stages, the evidence was under the
care and control of the agency under which the Plaintiff seeks to make its
subrogated claim, and was lost under circumstances such that a trial Judge
should consider an appropriate remedy to assist the Defendant, due to that loss
of evidence by the Plaintiff. The Defendant’s position is that the Plaintiff
took no action to raise the Tug after the Second Sinking.
[27]
Moreover, the Defendant argues that the divers
who did the first inspection of the Tug were not produced. It is the
Defendant’s position that the Plaintiff failed to submit critical evidence from
the “riding crew” of the Tug from Squamish to
the point where the standby pumps were unmanned.
[28]
Finally, the Defendant states that the evidence
relied upon by the Plaintiff is speculative and not based on actual physical
evidence. Relying solely on the expert report based on speculation with respect
to the cause of the First Sinking of the Tug, when it is admitted that there
was no obvious cause apparent after the Tug was first lifted, should not give
rise to a strict liability offence being decided without a full trial on the
merits.
II.
Issues
- Is a summary
trial appropriate under Rule 216 of the Federal Courts Rules?
- Should summary
judgement be granted?
III.
Analysis
A.
Summary Trial
[29]
The relevant provisions of the MLA are
attached as Appendix 1 hereto. Rule 216(6) of the Federal Courts Rules
provides:
If the Court is
satisfied that there is sufficient evidence for adjudication, regardless of the
amounts involved, the complexities of the issues and the existence of
conflicting evidence, the Court may grant judgment either generally or on an
issue, unless the Court is of the opinion that it would be unjust to decide the
issues on the motion.
[30]
This Court has confirmed that the application of
relevant British Columbia jurisprudence concerning Rule 18A of the former
British Columbia Supreme Court Rules, BC Reg 221/90, upon which Rules
213 and 216 of the Federal Courts Rules are based, is instructive (0871768
BC Ltd v Aestival (Vessel), 2014 FC 1047 at paras 57 to 61; Louis
Vuitton Malletier SA v Singga Enterprises (Canada) Inc, 2011 FC 776 at
paras 92 to 98).
[31]
The Court should consider that:
i)
The moving party has met its burden to
demonstrate summary trial is appropriate;
ii)
The issues to be decided are well-defined and
the facts necessary to resolve the issues are clearly set out in the evidence;
iii)
Even if there is/are genuine issues for trial
and no serious credibility issues, the issues can be decided if the motion
judge finds that there is nevertheless sufficient evidence to decide the
matter(s) either generally or on an issue, unless it would be unjust to do so;
iv)
The parties are obliged to put their best foot
forward (Rule 214) and if a party fails to do so, it does not frustrate the
ability of the Court to proceed by way of summary trial; and
v)
The summary judgment rules should be interpreted
broadly.
[32]
The parties generally agree that the background
facts are not in dispute, other than the one key issue of what caused the First
Sinking, and whether the facts surrounding the Second Sinking are in some way
relevant in determining third-party liability under subsection 77(3)(b) of the MLA.
Subsection 77(3)(b) of the MLA provides that if the Defendant can
establish that the sinking and resulting pollution was caused by an act or
omission of a third party, with intent to cause damage, he may be excused from
liability.
[33]
The only evidence provided by the Defendant with
respect to possible third-party liability is the fact that when the Tug was
raised after the First Sinking, the Door was torn off its hinges and a pad lock
was allegedly missing, which the Defendant argues suggests sabotage by a third
party.
[34]
Moreover, the Defendant’s evidence is that:
i)
Mr. Larsen had regularly been looking after the
vessel and had been attending on a number of occasions to make sure the
batteries were charged. He was last on board the Tug within days of its
sinking. The Tug has an extensive power system for the bilge pumps onboard the
vessel, which could be charged without further maintenance for up to two weeks.
Mr. Larsen had been on board the vessel within 2 to 5 days of its sinking and
everything was in working order. He last saw the vessel approximately a day
before it sank when he was walking along the channel. He saw the Tug from a
distance and it was its regular proper trim.
ii)
Mr. Larsen believed that the sinking of the Tug
was caused by the actions of a third party, due to an ongoing controversy he had
been involved in with Chris Tamburri, now deceased, who was a principal of
Squamish Towing Inc.
iii)
The Defendant believed that if he inspected the
vessel in a proper manner, evidence would be found to determine causation of
the sinking to be by third party. He did not believe the sinking of the Tug was
spontaneous.
iv)
Mr. Larsen described the Tug as having a stern
entry to the engine room on the starboard side, as depicted in the photograph marked
as Exhibit A to his affidavit. The door was locked together to prevent entry
and was in good condition. Mr. Larsen believed that the engine room door had
been compromised, the bilge pump system was shut off and the Tug was scuttled
by a third party.
[35]
The Defendant argues that given the fact that
the Plaintiff lost control of the only evidence to substantiate their case
(being the Tug), and the speculative nature of the expert report of Mr.
Holonko, it would be an abuse of process of this Court to render summary
judgement on this summary trial application.
[36]
The Defendant’s counsel quoted extensively from
the case of Wire Rope Industries of Canada (1966) Ltd v British Columbia
Marine Shipbuilders Ltd, [1981] 1 S.C.R. 363, at pages 392 and following, and McDougall
v Black & Decker Canada Inc, 2008 ABCA 353 [Black & Decker],
to argue that spoliation has occurred, given the loss of the Tug cause by the
CCG’s reckless actions, and therefore any remedy available to the Plaintiff
must be determined after a full trial, where the trial judge can consider all
of the facts and fashion the most appropriate response.
[37]
However, as stated by the Alberta Court of
Appeal in Black & Decker at paragraph 18:
St. Louis,
therefore, stands for the following proposition. Spoliation in law does not
occur merely because evidence has been destroyed. Rather, it occurs where a
party has intentionally destroyed evidence relevant to ongoing or contemplated
litigation in circumstances where a reasonable inference can be drawn that the
evidence was destroyed to affect the litigation. Once this is demonstrated, a
presumption arises that the evidence would have been unfavourable to the party
destroying it. This presumption is rebuttable by other evidence through which
the alleged spoliator proves that his actions, although intentional, were not
aimed at affecting the litigation, or through which the party either proves his
case or repels the case against him.
There is no
evidence that the Plaintiff intentionally destroyed or was reckless in respect
of the Second Sinking of the Tug such that it is no longer available as
evidence, or that it was aimed at affecting this litigation.
[38]
It is true that the inspection of the hull after
the First Sinking, by the Plaintiff’s expert, the Defendant and Mr. Larsen,
resulted in no conclusive factual reason for the sinking nor was there any
conclusive factual reason for the Second Sinking, or for the Tug to be lost for
further inspection.
[39]
However, contrary to the Defendant’s position,
the evidence before the Court does show the following:
i)
Neither the divers, the employees of the CCG,
nor their surveyor Mr. Small, nor the surveyor retained by the Plaintiff, Mr.
Holonko, nor Mr. Beasse and Mr. Larsen, found any evidence of the deliberate
act by a third party causing damage to the hull, or otherwise allowing ingress
of water.
ii)
With respect to the Door:
a)
The Door itself was found to be in good
condition, with no signs of being forced by physical action;
b)
The superstructure around the Door opening was
found to be severely rotted;
c)
There is a hatch, immediately above the Door,
which can be secured by a hasp which fits over a staple in the Door through
which a padlock can be placed. That hatch and the staple were both intact, clearly
indicating that the hatch was not locked at the time of the sinking;
d)
Shortly after the First Sinking, the Door was
delivered to Mr. J. Spears, who was the lawyer for the Defendant at the time.
The Door was held by him until it was produced for examination by the parties
to this action in May, 2017. At that time, the Door was found with the locking
mechanism in a retracted position, indicating that the Door was not locked at
the time of the sinking.
e)
Mr. Holonko has opined in his professional
opinion that the Door was broken off during the sinking itself, either by the
air pressure being forced out of the superstructure, or the water rushing into
the superstructure.
[40]
Further, any alleged animosity between an
employee of Squamish Marine Services and the Defendant is irrelevant to the
towing services provided by Valley, who was responsible for the Tug when the Second
Sinking occurred. The CCG also had no animus to the Defendant, and on
the facts, was doing everything it could to preserve the Tug for inspection,
from raising the Tug after the First Sinking, continuously up to the Second Sinking.
[41]
The facts need to be analyzed on a standard
aptly characterized in FH v McDougall, 2008 SCC 53, at paragraphs 44 to
46:
[44] Put another way, it would seem
incongruous for a judge to conclude that it was more likely than not that an
event occurred, but not sufficiently likely to some unspecified standard and
therefore that it did not occur. As Lord Hoffmann explained in In re B
at para. 2:
If a legal rule requires a fact to be
proved (a “fact in issue”), a judge or jury must decide whether or not it
happened. There is no room for a finding that it might have happened. The law
operates a binary system in which the only values are zero and one. The fact
either happened or it did not. If the tribunal is left in doubt, the doubt is
resolved by a rule that one party or the other carries the burden of proof. If
the party who bears the burden of proof fails to discharge it, a value of zero
is returned and the fact is treated as not having happened. If he does
discharge it, a value of one is returned and the fact is treated as having
happened.
In my view, the only practical way in which
to reach a factual conclusion in a civil case is to decide whether it is more
likely than not that the event occurred.
[45] To suggest that depending upon the
seriousness, the evidence in the civil case must be scrutinized with greater
care implies that in less serious cases the evidence need not be scrutinized
with such care. I think it is inappropriate to say that there are legally
recognized different levels of scrutiny of the evidence depending upon the
seriousness of the case. There is only one legal rule and that is that in all
cases, evidence must be scrutinized with care by the trial judge.
[46] Similarly, evidence must always be
sufficiently clear, convincing and cogent to satisfy the balance of
probabilities test. But again, there is no objective standard to measure
sufficiency. In serious cases, like the present, judges may be faced with
evidence of events that are alleged to have occurred many years before, where
there is little other evidence than that of the plaintiff and defendant. As difficult
as the task may be, the judge must make a decision. If a responsible judge
finds for the plaintiff, it must be accepted that the evidence was sufficiently
clear, convincing and cogent to that judge that the plaintiff satisfied the
balance of probabilities test.
[42]
The Plaintiff has established the expenses incurred
due to the pollution caused by the First Sinking. I agree with the Plaintiff
that the onus then shifts to the Defendant to prove its defence of third-party
responsibility under subsection 77(3)(b) of the MLA. The
Defendant has failed to raise a genuine issue for trial based on purely
speculative conjecture of a third party causing the First Sinking, when the
facts indicate that on a balance of probabilities no such activity occurred.
[43]
The Tug was unseaworthy and sunk – the Defendant
has failed to show in the evidence on a balance of probabilities any defence
based on paragraph 77(3)(b) of the MLA relating to third-party
responsibility for the First Sinking. The obligation on the Defendant to put
its best foot forward has not been met. The Defendant as owner of the Tug is
liable for the pollution clean-up.
[44]
There is no useful purpose in proceeding with
the full trial – evidence will shed no better light on the fact concerning the First
Sinking than what is presently before the Court. There is no evidence to
support a finding of third-party involvement to justify a defence under
paragraph 77(3)(b) of the MLA. It is in the interests of justice for the
Court to decide this matter by way of summary judgment.
IV.
Conclusions
[45]
The motion is granted. Costs to the Plaintiff. The
parties shall have ten (10) days from the date of this judgment to either agree
on costs or to submit their written representations on costs, not to exceed
five (5) pages.
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