The Csl Group Inc. v. Canada, docket T-1307-90

     T-1307-90

B E T W E E N:

     THE CSL GROUP INC. and

     CANADA STEAMSHIP LINES INC.,

     Plaintiffs,

AND:

     HER MAJESTY THE QUEEN IN RIGHT OF CANADA,

Defendant

     REASONS FOR JUDGMENT

NADON J.:

     The Plaintiffs¹, who are well-known shipowners of Montreal, seek to recover damages² from the Defendant by reason of delays in the transit times of fifteen of their ships in the St. Lawrence River, the Gulf of St. Lawrence, tributaries of the St. Lawrence River, the St. Lawrence River Seaway system and the Great Lakes (hereinafter referred to as the "St. Lawrence River System"), during the months of November and December 1989.

     The Plaintiffs, in bringing this action, rely on s. 3(1)(a) of the Crown Liability and Proceedings Act.³ The Plaintiffs take the position that their loss arises from a tort committed by a servant of the Crown. The Plaintiffs also rely on s. 78 of the Public Service Staff Relations Act,⁴ the significance of which will become apparent shortly

THE FACTS

     The Plaintiffs are Canadian shipowners. They regularly have a number of ships, either under their ownership or under charter, in transit on the St. Lawrence River System. The Defendant is Her Majesty the Queen in Right of Canada. This action stems from an alleged act of negligence committed by public servants employed by the Treasury Board of Canada, acting within the scope of their employment.

     From November 10, 1989 to December 15, 1989 public servants, including members of the Canadian Coast Guard ("C.C.G."), were on strike.⁵ On December 15, 1989 the Government Services Resumption Act⁶ received royal assent thereby ordering the Ships" Crews (supervisory) group, the Ships" Crews (non-supervisory) group, and the hospital services (supervisory and non-supervisory) groups to return immediately to work.

     It is the Plaintiffs" contention that because of the strike of the Ships" Crews groups, their ships were delayed to such an extent that outstanding contracts with shippers and receivers of cargo could not be performed before the end of the navigation season. The Plaintiffs submit that the delays caused them to lose revenue in the order of $2,600,360.00 and caused them to incur additional expenses in the sum of $90,000.00. The Plaintiffs" contention is that although the strike in question was a legal strike, the Defendant could have avoided, or at the very least minimized, the impact of the strike on the Plaintiffs if the public servants employed at the Treasury Board had taken the necessary steps to ensure that the Ships" Crews, by way of the designation process provided for by s. 78 of the PSSRA , were available to perform the duties which were required to protect the security and safety of the public.

     The C.C.G. is a division of the Department of Transport. It is an administrative organization. Its role is to provide all of the marine services that are the responsibility of the Department of Transport. With respect to the St. Lawrence River, the C.C.G. is responsible for the aids to navigation, vessel traffic management, radio communication, and coastal radio stations. Further, the C.C.G. is responsible for the certification and inspection of Canadian flag ships, certification of Canadian officers, pollution prevention and pollution response, ice breaking, ice observation and information, and finally search and rescue operations in partnership with the Department of National Defence.

     The Ships" Crews who were on strike in November and December of 1989, were, in the normal course of the C.C.G.`s business, involved in some of its important areas of activity. Specifically, the Ships" Crews, in the months of November and December of any given year, are involved in removing the summer buoys and replacing them by winter spars. The Ships" Crews are also involved in the ice breaking service operated by the C.C.G.

     Because of the strike, the ice breakers normally used by the C.C.G. in the St. Lawrence River were not in service. Further, the summer buoys, which in 1989 would have been removed at the end of November and the early part of December and replaced by winter spars, were not removed. Thus, as a result of the strike and the particularly difficult weather conditions which prevailed in the St. Lawrence River as of November 17, 1989, the summer buoys were caught in ice. In some cases they moved off their respective positions thereby creating a dangerous situation. For these reasons the C.C.G. had to take a number of steps with respect to navigation in the St. Lawrence River which caused delays to the ships in transit. For example, between December 2 and December 4, 1989 the C.C.G. prohibited all navigation between Quebec City and Les Escoumins. Not only was transit delayed, in many instances it came to a complete halt.

     A memorandum prepared by the C.C.G. dated December 6, 1989 entitled Backgrounder,⁷ explains the situation prevailing on the St. Lawrence River between December 1 and December 6, 1989, as follows:

Re:      CLOSING OF ST. LAWRENCE RIVER BETWEEN QUEBEC CITY AND LES ESCOUMINS

-      The St. Lawrence River between Quebec City and Les Escoumins closed temporarily on December 1, 1989 as a result of deterioration of navigation conditions brought on by the fact that it has not been possible to lift the summer buoys (aids to navigation) and replace them with winter buoys in the navigation channel. This closure resulted from the ships" crew[s] onboard Coast Guard vessels having been on strike since November 11, 1989. Mediation talks began on Wednesday, November 29, and terminated without resolution at 0330 on Saturday, December 2, 1989.

-      Due to below normal temperatures, the buoys are heavily iced and some have been broken free from their normal locations by the moving ice floes. Some of these buoys have submerged due to the ice in the area while others are moving with the ice, with some in the navigation channel. These rogue buoys, as well as a number lost altogether at this stage and an unknown number of buoy anchors on the bottom of the shipping channel, all represented a hazard to navigation and resulted in the need to close navigation.

-      There was a tug survey undertaken on Sunday, December 3, 1989 and a tug and helicopter survey on Monday, December 4, 1989 of sections both above and below Quebec to survey the channel to determine if consideration could be given to opening the area under restricted navigation conditions. Results of the Monday survey were reviewed and a decision based on recommendations from the Laurentian Pilotage Authority, the two Pilot Corporations concerned, and the Canadian Coast Guard, the Minister agreed to the opening of the channel on Tuesday, December 5, 1989 between Quebec City and Les Escoumins based on restricted navigation conditions. These conditions for two-way transit in the area as modified based on the first day of operations are:

-      daylight navigation between Quebec & Pointe au Pic with 24 hour navigation between Pointe au Pic and Les Escoumins

-      two pilots on board

-      tug to be kept on patrol/available in North Traverse during hours of navigation

-      satisfactory visibility

-      draft restrictions (6 feet under keel)

-      In addition, the river between Montreal and Quebec City will also have similar navigation restrictions with additional restrictions added. These restrictions are:

-      daylight navigation

-      two pilots on board

-      satisfactory visibility

-      draft restrictions (6 feet under keel clearance)

-      tug to be kept on standby during navigation hours at the Quebec bridge and at the Laviolette Bridge at Trois Rivières

-      tug to patrol in the Quebec City to Grondine area

-      one way navigation

-      As of 0700, December 6, 1989, there were 14 vessels in the Gulf of St. Lawrence bound for the pilot boarding station at Les Escoumins, 49 vessels waiting or in transit upbound between Les Escoumins and Quebec City, 22 vessels transiting the Seaway downbound for Montreal, and 15 downbound from Montreal to Quebec City.

-      This morning due to significant ice buildup at Laviolette Bridge at Trois Rivières, it has been necessary to temporarily close this section of the river. Tugs have been despatched to attempt to work on this situation.

At 2154 Sunday, December 3, 1989 the ENERCHEM ASPHALT while entering St. Lambert lock (first Seaway lock opposite Montreal in the Montreal/Lake Ontario section of the Seaway) hit and damaged the upper gates of the lock. Repairs were completed and the lock reopened at 0545, December 6, 1989.

At a cost of between $5,000 and $15,000/day, or more dependent upon the type of ship, the cost to shipowners, during stoppage in the system are significant.

Current water temperatures at Montreal are 0, and at Beauharnois Quebec are 0.2C (this is in comparison to the 10-year average, on this same date of 3.6C). There is a report of 4 inches of ice in the south shore canal of the Seaway.

-      The International St. Lawrence River Board of Control (Board of IJC) approved a reduction in flow of 28,000 cubic feet per second (cfs) on the river last night so as to promote formation of a stable ice cover on the Beauharnois Canal. This is in accordance with normal practice but is occurring nearly three weeks earlier than normal.

     This situation was aggravated when, as the memorandum relates, on December 3, 1989 at 21:54 hours the ship ENERCHEM ASPHALT collided with the upper gates of the St. Lambert lock. As a result of this collision the St. Lambert lock was closed until 05:45 hours on December 6, 1989.

     The memorandum goes on to highlight the fact that the closure of the St. Lambert lock was very costly to the owners and charterers of ships using the Seaway system. It goes without saying that the closure of the St. Lawrence River between Quebec City and Les Escoumins was also costly to shipowners.

     The memorandum also explains what steps the C.C.G. decided to take following the resumption of navigation on the St. Lawrence River on December 5, l989. For example, with respect to navigation between Montreal and Quebec City, restrictions were put into place by the C.C.G. to assure safe navigation, i.e. daylight navigation, two pilots on board, draft restrictions, tugs to be kept on standby at the Quebec Bridge and at the Laviolette Bridge in Trois-Rivières, and one-way navigation.

     The memorandum attributes the problem with the buoys to "below normal temperatures". The overall evidence, including that of expert witness Fred Parkinson, was to the effect that the cold weather which set in mid-November 1989 did not abate. In fact, beginning November 17, 1989, except for November 20, the prevailing temperature remained below 0. According to Mr. Parkinson, the weather conditions were approximately one month early, i.e. they should have been expected at the end of December/early January.

     Thus, it can be said that it was a particularly bad year not to have ice-breakers in service. It was also a bad year not to have been able to remove the summer buoys.

     I should point out that following the C.C.G."s decision to close the St. Lawrence River between Quebec City and Les Escoumins, a meeting was organized at Montreal between officials of the Coast Guard and representatives of the shipping industry. Also in attendance were representatives of the pilotage associations. During the meeting, the C.C.G. put forward a plan which is reflected in a Note to File prepared by the then Deputy Coast Guard Commissioner, Michael Turner, who is presently the Commissioner. The Note to File is dated December 4, 1989 and reads as follows:

Re:      Conditions for resumption of safe navigation on the St. Lawrence River, Montreal to Les Escoumins.

At 1500hrs December 4, 1989, a telephone conference was held to receive the reports from the surveillance by tug and helo on the river, and the recommendations / advice of pilots. Those participating were:

Ottawa: Quail/ Turner/ Quinn/ Hubbard/ McNeill/ Kingston.

Montreal & Quebec: Chouinard & LaHaie (LPA), Leroux (Central Pilots), Pouliot, Dufour & Lapointe (Lower Pilots), Latremouille & Duval (CCG-L).

After discussion on the present situation, all parties agreed that navigation could safely recommence, providing that the following compensating conditions were implemented:

QUEBEC TO LES ESCOUMINS:

-      Navigation would reopen effective daybreak tomorrow,

-      movements in daylight only, subject to satisfactory visibility,

-      Each vessel to have two pilots,

-      minimum six feet underkeel clearance to be maintained,

-      A tug to be kept on patrol / available in the area of the North Traverse, during hours of navigation.

MONTREAL TO QUEBEC:

-      Navigation to continue as present with two pilots, and daylight only, satisfactory visibility, plus:

-      Tug to be kept on standby during navigation hours at the Quebec bridge,

-      Tug to be kept on standby during navigation hours at the Laviolette Bridge at Trois Rivieres,

-      One way traffic each day, at least until some experience gained.

-      Minimum six feet underkeel clearance, (effectively at least three feet more than presently allowed for.)

-      Tug to patrol in the Quebec to Grondine area.

-      Ships bound Trois Rivieres area not to depart unless anchorage or berth available at end of day destination. (To be co-ordinated by pilots/LPA & VTS.)

It was agreed that Ran Quail would now take forward these views to the Deputy Minister / Minister for discussion.

After briefing the Deputy at about 1550, word was received from the DM at about 1605 that the proposals were acceptable to the Minister.

A conference call was then held at 1630 with all the parties involved in the 1500 discussion, plus:

Les MacArthur & Angus Laidlaw (CSA), Frank Nichol & Ivan Lantz (ShipFed), Kieran Shanahan (Ultramar) to advise of the Minister"s agreement and review / confirm the conditions noted above. During the discussion it was noted that:

-First day (Dec 5th) for Quebec to Montreal section will be downbound, as there are 29-31 ships ready in Mtl to Quebec.

-LPA expects to be able to handle about 24 of 31 ships East of Quebec waiting to come up, during the first day. This will ease planning re berths & anchorages for upbound traffic.

-First ship downbound from Quebec will not be a tanker.

-LPA confirmed vessels will not be delayed if a vessel ahead in rotation is too deep and must await tidal conditions. i.e. pilotage use will be maximized, traffic kept moving.

-LPA expects no problem in accomodating [sic] the "Nilam", Ultramar"s first incoming crude carrier.

Discussion followed on the disposition of, and payment for, tugs in support of these operations. It was noted that ShipFed / FedNav had prepositioned the McAllister tugs to Quebec, and these are now on hire to them on the expectation that the CCG will cover the costs if the reopening plan proceeds. The Quebec Tugs unit used for the North Traverse survey was similarly arranged for by the Shipping Federation.

IT WAS AGREED THAT:

-Coast Guard (Laur) will now arrange to contract with Quebec Tugs for the North Traverse patrol, and will cover the costs of the patrol / survey update.

-Coast Guard (Laur.) will pick up the contract for the McAllister tug to be used for Que-Grondine patrol, and will send the other unit back to Montreal, also covering the costs to date of both units.

-Coast Guard (Laur) will now contract with Quebec Tugs for the unit to standby the Quebec Bridge and for the Trois Rivieres tug "Dugal" to standby the Laviolette bridge.

It was also agreed that a suitable NotShip would be issued by Laurentian region, advising of restoration of navigation, and the draft restrictions that would apply. Industry organizations would assist in promulgating the information.

         The C.C.G. had advised the shipping industry at the end of October 1989 that the strike by the Ships" Crews was a very serious possibility. At one point in time the C.C.G. considered hiring the private sector to undertake the removal of the summer buoys. However, that option was not exercised. The C.C.G. firmly believed that the strike would end quickly and that sufficient time would be available to remove the summer buoys before the cold weather set in. However, as events unfolded, cold weather set in early and the summer buoys became an obstacle to navigation. As a result of all of this, the C.C.G. had to take the unusual step of closing the St. Lawrence River from December 2 to December 4.

     Also of interest in understanding the effect of the strike combined with the cold weather on navigation in the St. Lawrence River is a document entitled Evolution des restrictions de circulation which sets out, in chronological order, the various notices to mariners issued in December 1989 by the C.C.G. as of 21:25 hours on December 1, 1989.

     ÉVOLUTION DES RESTRICTIONS DE CIRCULATION

# Avis      Annulé par

     avis no

4212      89-12-01/21:25      Interruption navigation entre Québec et les Escoumins      438l

     Date et heure UTC⁸ (avis)

     déc.01-18:50

     Date et heure locale (CRI)⁹

4368      89-12-04-19:16      Pas de transit dans secteur du pont de Québec      4381

     déc. 04-14:45

4381      89-12-04/21:33      Navigation le jour seulement, le 5 décembre dans le sens      4409

                 Montréal vers Québec.

     déc. 04-22:03 (F)

     23:01 (A)      Dans les deux sens entre Québec et Les Escoumins

4409      89-12-05/23:45      Navigation de jour seulement entre les Escoumins      4428

                 et Montréal

     déc. 05-19:19 (F)      Le 6 décembre dans le sens Québec-Montréal

     20:23 (A)      Dans les deux sens entre Québec et Les Escoumins

4428      89-12-05/23:45      Navigation de jour seulement entre Cap aux Oies

     déc. 06-17:02      et Montréal

     idem que L-4409      Le 7 décembre dans le sens Québec - Montréal

                 Dans les deux sens entre Québec et Les Escoumins      4440

4440      89-12-07/09:25      Navigation de jour seulement entre Cap aux Oies et Trois-

     déc. 07-04:52      Rivières

                 Québec - Trois-Rivières: sens et date non spécifiés

                 Dans les deux sens entre Québec et les Escoumins      4458

4458      89-12-07/22:52      Navigation de jour seulement entre Cap aux Oies et Montréal

     déc. 08-10:09      Le 8 décembre dans le sens Québec vers Montréal

                 Dans les deux sens entre Québec et Les Escoumins      4490

4490      89-12-08/22:46      Navigation de jour seulement entre Cap aux Oies et Montréal

     déc. 08-19:11      Le 9 décembre dans le sens Montréal vers Québec. Dans les

                 deux sens entre Québec et Les Escoumins

                 Navigation nocturne le 89-12-09 à partir de 16 h - L de Québec

                 vers la mer      4520

4520      89-12-90/21:52      Navigation de jour seulement entre Cap aux Oies et Montréal

     déc. 09-17:15      Navigation nocturne en direction est à partir de Québec

                 Le 10 décembre dans le sens Montréal vers Québec

                 Dans les deux sens entre Québec et Les Escoumins      4540

4540      89-12-10-/21:34      Navigation de jour seulement entre Cap aux Oies et Montréal

     déc. 10-16:50      Navigation nocturne en direction est à partir de Québec

                 Le 11 décembre dans le sens de Montréal vers Québec

                 Dans les deux sens entre Québec et Les Escoumins      4581

4581      89-12-11/23:52      Navigation diurne [sic] Cap-aux-Oies à Montréal

     (déc. 11-19:48)      Navigation nocturne à sens unique dans certaines secteurs

                 suite à des consultations.

                 Deux sens entre Québec et Les Escoumins

                 Sens unique le 12 Québec à Montréal

                 Navires à Rivière Maheu pourront partir le 12 à compter

                 de 03:30      4613

4613      89-12-13/00:01      Cap-aux-Oies - Québec (2 sens):

     (déc. 12-20:58)      deux sens de jour;

                 de nuit à sens unique.

                 Québec - Trois-Rivières (2 sens):

                 jour seulement à sens unique; le 13, Québec à Trois-Rivières.

                 Trois-Rivières - Montréal (2 sens):

                 jour seulement: deux sens s"il n"y a pas de rencontre

                 (planification avec STM)      4623

4623      89-12-13/22:15      Cap-aux-Oies - Québec (2 sens):

     (déc. 13-17:34)      deux sens de jour; de nuit à sens unique

                 Québec - Trois-Rivières (2 sens):

                 jour seulement à sens unique;

                 le 14, Trois-Rivières à Québec

                 Trois-Rivières - Montréal (2 sens):

                 jour seulement; deux sens s"il n"y a pas de rencontre

                 (planifier STM)      4650

4650      89-12-14/22:55      Idem

                 Québec - Trois-Rivières (2 sens): le 15: Québec à

                 Trois-Rivières

                 Idem      4683

4683      89-12-15-20:43      Idem

     (déc. 15-)          Trois-Rivières vers Québec le 16: sens unique de      4689

                 jour seulement.

                 Trois-Rivières à Montréal: de jour seulement. Deux sens

                 autorisé s"il n"y a pas de rencontre.

                 Planification sera effectuée par STM-Mtl, dégagement sous

                 quille minimal de l,84 m.

                 Départs autorisés après 06:00 heures.

4689      89-12-16/20:28      Idem

     (déc. 16-16:12)      Québec - Trois-Rivières (2 sens): le 17: Trois-Rivières

                 à Québec

                 Idem      4698

4698      89-12-17/19:37      Idem

     (déc. 17-15:12)      Québec - Trois Rivières (2 sens): le 18, Québec à

                 Trois-Rivières

                 Idem      4726

4726      89-12-18/21:49      Idem

     (déc. 18-17:14)      Québec - Trois-Rivières (2 sens): le 19: Trois-Rivières

                 à Québec

                 Idem      4753

4753      89-12-19/22:39      Idem

     (déc. 19-18:04)      Québec - Trois-Rivières: (2 sens)

                 le 20 : Québec à Trois-Rivières

                 Idem      4774

4774      89-12-20/22:06      de Québec vers l"est: 2 sens, de jour et de nuit

     (déc. 20-17:36)      Québec - Trois-Rivières (2 sens): jour seulement sens unique

                 le 21: Trois-Rivière à Québec

                 Trois-Rivières - Montréal (2 sens): Idem      4784

4784      89-12-20/22:06      Idem

     (déc. 21-18:26)      Québec - Trois-Rivières (2 sens): le 22: T.-Rivières

                 à Québec

                 Trois-Rivières - Sorel (2 sens): jour seulement n"importe

                 quel sens s"il n"y a pas de rencontre (planafication STM)

                 Sorel - Montréal (2 sens): 2 sens jour et nuit      4795

4795      89-12-20/22:06      Idem

     (déc. 22-16:11)      Québec - Trois-Rivières (2 sens): le 23 : Trois-R. à Québec

                 Trois-Rivières - Sorel (2 sens): Idem

                 Idem      4801

4801      89-12-23/19:10      Idem

     (déc. 23-14:22)      le 24: Trois-Rivières à Québec

                 Idem

                 Idem      4807

4807      89-12-24/18:37      Fleuve St-Laurent: navigation jour et nuit

     (déc. 24-14:02)      dans les deux sens.

                 (dégagement de l,84 m requis)          0084

     The Commissioner of the C.C.G., Mr. Michael Turner, testified at the trial of this matter. Mr. Turner was also examined by the Plaintiffs on discovery.¹⁰ During his testimony, Mr. Turner explained what the C.C.G. did prior to and during the strike to allow marine traffic to proceed in safety. According to Mr. Turner, the strike was comprised of a number of phases. First, the lead up period to the commencement of the strike. During this period, the C.C.G. did all of its planning in anticipation of the strike and consulted with the shipping industry on a number of matters, in particular regarding the removal of the summer aids to navigation. It is also during this period that the C.C.G. considered contracting out to the private sector some of the work normally performed by the Ships" Crews including the removal of the summer buoys.

     The second period of C.C.G. activity was the period from November 10, 1989 until the last week of November. According to Mr. Turner, the fact that the summer buoys were still in place during that period allowed marine traffic to proceed in full safety.

     The third period was that between the last week of November and December 5 when the C.C.G. was forced by events to take specific measures to facilitate the movement of traffic. It is during this period that serious problems were encountered by the C.C.G. by reason of the extreme cold weather and as a result, marine traffic was greatly delayed. During this period, the C.C.G., using helicopters, carried out continuous surveillance of the aids to navigation.

     Mr. Turner pointed out that near the end of November the river pilots became concerned about safety as many buoys had moved off position or were simply not working. Mr. Turner further explained that near the end of November it became impossible for the C.C.G."s radio stations and traffic systems to advise mariners with respect to which aids to navigation were working. For these reasons, the river pilots took the position that they could no longer move their ships in safety. C.C.G. officials discussed the situation with representatives of the shipping industry and a decision was taken on December 1, 1989 to close the river between Quebec and Les Escoumins. Although traffic between Montreal and Quebec City was not prohibited, the closure of the river below Quebec City impacted on the flow of the traffic in all other parts of the river.

     As I have already indicated, on December 2 a meeting was organized in Montreal during which the C.C.G. explained to the shipping industry what course of action it intended to take in order to reopen that part of the river which had been closed and to ensure that marine traffic could move in safety.

     On the morning of December 5 navigation between Quebec and Les Escoumins was reopened but severe restrictions were put into place until the end of the strike. For example, underkeel clearance was increased by about one metre in order to have a better safety margin. Double pilotage and daylight navigation are other examples of the restrictions which were implemented by the C.C.G.

         The Plaintiffs" case is a very simple one. The Plaintiffs submit that by reason of the strike of the Ships" Crews groups, navigation in the water lanes of the St. Lawrence River became extremely difficult. The Plaintiffs attribute this difficulty to the non-availability of the ice-breakers and to the fact that the C.C.G. was unable to remove the summer buoys and replace them with the winter spars prior to the cold weather setting in. The Plaintiffs submit that if the ice breaking equipment had been available and the summer aids to navigation had been removed, the delays encountered by their ships would not have occurred.

     Since the strike by the Ships" Crews as of November 11, 1989 was a legal strike, the Plaintiffs did not attempt to blame the Defendant for the occurrence of the strike, nor could they. However, the Plaintiffs hold the Defendant responsible for having failed to designate, pursuant to s. 78 of the PSSRA , those employees required to ensure the safety or security of the public. The Plaintiffs submit that the majority of the Ships" Crews groups would have been so designated had the Defendant not been negligent. Finally, the Plaintiffs argue that had the Defendant designated employees, the delays encountered by their ships would not have occurred and they would have been able to fulfil their contractual obligations for the 1989 season.

     I hereby reproduce paragraphs 3 through 12 of the amended statement of claim which set out, in clear terms, the Plaintiffs" case as it stood at the commencement of the trial.

3.      The Defendant, inter alia, is and was, at all material times, responsible for the operation, management and conduct of the Canadian Coast Guard insofar as concerns the safety, security, general management and operation of the channels, aids to navigation, ice breakers, all Coast Guard vessels connected with said operation and all personnel connected therewith;

4.      The Defendant, inter alia, is and was, at all material times, responsible, through its Treasury Board, for the proper conduct and management of its labour relations;

5.      The Defendant, in such capacities and otherwise, owes and owed a duty to the Plaintiffs and all users of the waterways in question to maintain same at all times in a fully safe and operational condition;

6.      In virtue of the Public Service Staff Relations Act, the Defendant through the Treasury Board has the power and duty, once a bargaining unit of the Public Service Alliance of Canada has notified its intention that any of the employees within said bargaining unit intend to exercise a right to strike, to make and file with the Public Service Staff Relations Board a list designating those employees which it considers necessary for the maintenance of essential services in respect of the safety and security of the public;

7.      On the 24th day of November, 1987, the bargaining agent for the employees of concern served notice to bargain on the Treasury Board with respect to five bargaining units, including the Ships Crews Group, thereby requiring that the Treasury Board exercise its right and duty to make and file the designated list of employees by not later than the 14th day of December, 1987;

8.      The Defendant through its Treasury Board intended to designate all of the employees of the Ships Crews Group and others, which said employees would have ensured the operation of normal shipping in the St. Lawrence River during the currency of any strike which might intervene but the Treasury Board through its lack of organization, bureaucratic ineptitude, lack of foresight and good management, generally amounting to an act of negligence by omission, failed to file the said list within the designated time stipulated by the applicable statute;

9.      Had the Treasury Board designated its list of employees within the time allowed by the applicable statute, then the Public Service Staff Relations Board would have designated all of those employees within the Ships Crews Group and others as being employees providing essential services, thus removing from that particular group and others the right to engage in the contemplated strike;

10.      On November 11, 1989, the strike of the personnel involved in the aforementioned matters commenced with the result, inter alia, that the shipping channels of the St. Lawrence River and other waters referred in paragraph 1 hereof became exceedingly difficult to navigate by reason, inter alia, of the lack of ice breaking and clearing equipment normally operated by the Coast Guard, by reason of the failure of the Coast Guard to have removed, within time, the summer buoys and aids to navigation and replacing them with the standard winter buoys and aids to navigation, thereby rendering navigation in the channels treacherous, the whole of which would have risked to effectively close these waters to navigation had it not been for the extraordinary steps taken by private commerce and industry itself to use such equipment as it could obtain to keep marine traffic moving, however slowly and uncertainly;

11.      The Defendant could have, following the failure of the Treasury Board to file the designated list within time, taken alternate methods to ensure safe and appropriate navigation within the channels in question, such as letting contracts to private concerns to undertake much of the work which the Coast Guard crews would have attended to but, and through its failure to act, hesitation and the general incompetency of the administration of the Canadian Coast Guard and other employees of the Defendant whose duty it is to ensure safe navigation within said waters, no alternate means to ensure the movement of traffic within the waters were undertaken;

12.      The Defendant additionally and through its Coast Guard or other employees, and being well aware of the pending strike, could have taken a number of steps prior to the strike to alleviate the conditions which subsequently occurred by having the Coast Guard attend to some of its duties prior to the strike and, in particular but without restricting the generality of this allegation, causing, prior to the commencement of the strike, the removal of summer buoys and replacement by winter buoys;

     During the course of the trial and in argument, counsel for the Plaintiffs made it abundantly clear that the sole act of negligence for which the Plaintiffs were reproaching the Defendant was that of having failed to designate pursuant to s. 78 of the PSSRA. Thus, the allegations which appear in paragraphs 11 and 12 of the amended statement of claim were abandoned.

     With respect to the allegations concerning the failure to designate under s. 78 of the PSSRA, the parties filed, at the commencement of the trial, a statement of admitted facts entitled Admissions which reads as follows:

THE PARTIES TO THE PRESENT LITIGATION HEREBY ADMIT THE FOLLOWING:

     I FACTS

1.      The Plaintiffs are and were, at all material times, steamship companies owning, managing, operating and/or chartering a number of vessels within the waters of the St. Lawrence River, the Gulf of that River, tributaries of that River, the St. Lawrence River Seaway system and the Great Lakes

2.      The vessels referred to in paragraph 1 hereof are the motor vessels RICHELIEU, FERBEC, SIMCOE, WINNIPEG, WHITEFISH BAY, BAIE ST-PAUL, BLACK BAY, LEMOYNE, L.R. DESMARAIS, TADOUSSAC, SAGUENAY, MANITOULIN, TARANTAU, ATLANTIC HURON, and NANTICOKE;

3.      In 1967, the Parliament of Canada, enacted the Public Service Staff Relations Act, R.S.C. [1985], ch. P-35 (the "PSSRA"), (then cited at S.C. 1966-67, c. 72),

4.      By virtue of the PSSRA, the Treasury Board was named to represent the Defendant as the employer of the vast majority of public service employees, including those who were members of the Ships" Crews (supervisory) Group and the Ships" Crews (non-supervisory) Group (the "Ships" Crews Groups"), two groups employed with Transport Canada (the Canadian Coast Guard).

5.      In order to promote collective bargaining, the PSSRA provides that members of a bargaining unit who seek to negotiate a collective agreement have the choice of two mechanisms for resolution of a dispute, namely: referral of the dispute to arbitration or referral of the dispute to a conciliation board. Where conciliation fails, the employees within the bargaining unit may engage in a lawful strike (hereinafter sometimes referred to as the "conciliation-strike process");

6.      However, in order for members of a bargaining unit (who have sent notice to the Treasury Board to bargain collectively) to have recourse to a strike as the chosen dispute resolution mechanism, the PSSRA provides, in subsection 78 (1), that a conciliation board may not be established until the parties have agreed, or the Public Service Staff Relations Board ("PSSRB") has determined, the employees or classes of employees in the bargaining unit ("the designated employees") whose duties consist in whole or in part of duties the performance of which at any particular time or after any specified period of time or will be necessary in the interest of the safety or security of the public;

7.      Under the "conciliation-strike process" pursuant to subsection 78(2) of the PSSRA the employer, after notice to bargain collectively is given by the bargaining unit, has 20 days to furnish to the PSSRB and to the bargaining agent of the relevant bargaining unit, a statement of the employees or classes of employees who are considered by the employer to be "designated employees";

8.      On November 24th, 1987, the Treasury Board received notices to bargain collectively from the PSAC with regard to the Ships" Crews Groups and other groups;

9.      On December 15, 1987, after the period set forth in the PSSRA, the Treasury Board furnished to the PSSRB the statements of the employees that it considered to be "designated employees" with regard to the Ships" Crews Groups, and other groups;

10.      Following the furnishing of these statements, the PSAC objected, on the basis of tardiness, to consideration by the PSSRB of proposals concerning employees to be "designated employees" for, inter alia, the Ships" Crews Groups;

11.      Following these objections, the PSSRB held a series of hearings in order to dispose of these objections. An initial hearing was held on May 2nd, 1988 concerning the proposed designation of members of the Data Processing Group (PSSRB File 181-2-279) and on May 16th, 1988 the PSSRB rejected the objections of the PSAC;

12.      Thereafter, the PSAC filed an application to the Federal Court of Appeal pursuant to section 28 of the Federal Court Act to review this decision. In Reasons for Judgements rendered in the Federal Court of Appeal dated September 27th, 1988, the Federal Court of Appeal allowed the application by the PSAC and ordered the case to be returned to the PSSRB;

13.      On October 11, 1988, the PSSRB once again heard objections from the PSAC in the Data Processing Case. On October 27th, 1988, the PSSRB sustained the objection sought by the PSAC;

14.      On May 26th and 31st and June 1st, 1989 the PSAC"s objections respecting the designations in the files concerning these bargaining units (PSSRB files 181-2-269, 181-2-270 and 181-2-277) were heard. On July 17th, 1989, the PSSRB sustained the objections made by the PSAC;

15.      On or about July 27, 1987 the Treasury Board filed an application to review the PSSRB"S decision before the Federal Court of Appeal and on September 18, 1989, the Federal Court of Appeal upheld the decision of the PSSRB (Federal Court of Appeal file A-321-89);

16.      Throughout the period mentioned above and hereinafter, the Treasury Board and the PSAC had been pursuing and continued to pursue negotiations with regard to the Ships" Crews Groups but, despite the intervention of a conciliator of the PSSRB, they were unable to reach a collective agreement;

17.      The Ships" Crews Groups began a walk out in the Laurentian Region on November 10, 1989. On November 11, 1989, members of the Ships" Crews Groups acquired the legal right to strike in accordance with subparagraph 102 (2) b) (ii) of the PSSRA, and went on strike that day;

18.      From November 29th to December 2nd, 1989, a mediator named by the PSSRB attempted to reconcile the differences between the Treasury Board and the PSAC;

19.      On December 6th, 1989, Bill C-49, which provided for the resumption of government services, was given first reading in the House of Commons. On December 7th, 1989, Bill C-49 was given second reading in the House of Commons. On December 8th, 1989, the House of Commons passed Bill C-49. On December 9th and 10th, 1989, the Treasury Board submitted to the PSAC a global proposition aimed at settling the dispute. This proposition was rejected by the members of the Ships" Crews Group;

20.      On December 15th, 1989, the Government Services Resumption Act, S.C. (1989), ch. 24 received Royal Assent. This Act terminated the strike of the members of the Ships" Crews Groups and others and ensured that government services which had been disrupted during the strike would resume;

21.      In June 1989, the Canadian Coast Guard Fleet Systems Regional Managers were requested to update regional strike contingency plans. On July 6, 1989, Treasury Board requested an outline of the impact of strike activities on operational programs and on July 27, the Director General of Staff Relations, Transport Canada, replied to the Treasury Board"s request and advised that the Department had established headquarters and regional strike planning committees and were attempting to priorize services;

22.      Prior to the commencement of the strike activity by the Ships" Crews Groups, the shipping public including, inter alia, the Plaintiffs, the Canadian Shipowners Association and the Shipping Federation of Canada (Plaintiffs were members of both groups) who were consulted by the Canadian Coast Guard, were aware of the dispute involving the Ships" Crews Groups and of the possibility of a strike. Notices to Shipping were issued on or about November 3rd, 5th and 7th advising mariners that, as the Canadian Coast Guard ships" crews would be in a legal strike position as of November 11th and as the Canadian Coast Guard"s ability to provide services would be impacted, contingency measures would be taken and mariners should use caution and observe cautionary notes applicable to the list of marine aids;

23.      The shipping public was informed and consulted on the strike situation and in particular on questions concerning:

(a)      the removal of marine aids (including buoys) and the replacement of buoys by winter spars, it being noted by the Canadian Coast Guard that the Canadian Shipowners Association and the Shipping Federation of Canada had concerns and were opposed to the early removal of buoys (in anticipation of strike activity);

(b)      traffic volumes and movements;

(c)      pilotage requirements;

(d)      weather conditions and water levels; and

(e)      safe navigation.

24.      Prior to and during the strike, the Defendant took steps to minimise the effects of the strike on the public and in the end result no property, including the Plaintiff"s property, was reported to have suffered physical damage or loss of any kind whatsoever. Furthermore, commitments were obtained by the Canadian Coast Guard from the PSAC representatives to provide a Search and Rescue (SAR) capability and to respond to SAR emergencies in the Newfoundland, Maritime, Laurentian, Central and Pacific Regions and a Canadian Coast Guard Contingency Plan was prepared and distributed;

     II OTHER MATTERS

25.      The parties consent to the joint filing of the decisions of the PSSRB and Federal Court of Appeal referred to herein;

26.      The parties agree to be bound by the facts set forth in the decisions mentioned in paragraph 25 hereof, as if the Crown employees mentioned therein were to come before the Federal Court in this matter and testify to the same effect;

27.      The parties consent to the joint filing of the discovery of Mr. Donald Love (conducted on March 28, 1994), and Mr. Love will not be called by any party as a witness;

28.      The parties agree not to call at trial any servants of the Crown at the Treasury Board or other persons to testify on the issue of the late filing;

     I should point out that paragraphs 21, 22, and 23 of the Admissions explain what steps were taken by the C.C.G. in expectation of the strike of the Ships" Crews groups. More particularly, paragraph 22 is to the effect that the C.C.G., through notices to shipping issued between November 3 and November 7, 1989, advised the shipping community that the Ships" Crews would be legally entitled to strike as of November 11. Consequently, the C.C.G."s ability to provide the services which were normally rendered to the shipping community would be impaired.

     Paragraph 23 highlights the fact that the C.C.G. consulted the shipping industry with respect to the removal of the summer buoys prior to the commencement of the strike but that the shipping industry was opposed to their early removal. The evidence of Michael Turner was to the effect that the shipping industry asked the C.C.G. to keep the summer buoys in place "as long as possible".

     Paragraph 24 of the Admissions indicates that the Defendant took such steps as were necessary to minimize the impact of the strike on the public and that, as a result, no loss of property or life occurred.

Issues

I now turn to the issues which call for determination. There are, in effect, two issues which must be decided:

1.      What is the Crown's duty, if any, to the Plaintiffs? Is there a Common Law and/or a statutory duty?

2.      Was there a breach of that duty? Could a Crown servant be held personally liable for the act or omission complained of?

Analysis

Crown Liability

     At Common Law the Crown is not liable as an ordinary person. However, it is incorrect to say that the Crown is "above the law". The Crown, at least since the nineteenth century, has been immune from liability in tort as the "petition of right" was held not to provide a remedy for tort.¹¹ Over the years the law was reformed in many jurisdictions, spearheaded by innovative decisions rendered in Australia and New Zealand.¹² In 1887 the Canadian Exchequer Court Act included a provision conferring jurisdiction on the Exchequer Court for claims against the Crown arising from the negligence of its servants occurring "on a public work".¹³ In 1952 the federal Crown Liability Act¹⁴ was passed and it imposed tortious liability on the Crown "in respect of a tort committed by a servant of the Crown [and] in respect of a breach of duty attaching to the ownership, occupation, possession or control of property". The same two heads of liability exist today in the Crown Liability and Proceedings Act¹⁵ and they remain the only two heads of liability to which the federal Crown is subject.

     Some of the provincial Crown liability acts also include a provision which makes the provincial Crown liable for the breach of a statutory duty. However, these provisions add nothing to the liability of the Crown. If a statute imposes a duty on the Crown and provides for a private right of action for damages suffered if that duty is breached,¹⁶ then the Crown is directly liable by virtue of that statute and a plaintiff need not rely on a separate Crown liability act. However, where there is no statutory duty imposed on the Crown, invoking the CLPA will not provide a remedy for an alleged failure to act under the legislation as there will be no breach of a duty. If there is a duty under the statute, by showing a breach of that duty, the plaintiff will establish a prima facie act of negligence.

     Recently, in a yet unreported judgment¹⁷, my colleague Mr. Justice Wetston provided the following summary regarding these areas of the law:

The ingredients for the tort of negligence are summarized by G.H.L. Fridman in The Law of Torts in Canada, vol. 1 (Toronto: Carswell, 1989), at page 233. To succeed with a negligence claim, the plaintiff must establish (i) that he or she was owed a duty of care by the defendant; (ii) that the defendant should have observed a particular standard of care in order to perform or fulfil that duty; (iii) that the defendant broke his or her duty of care by failing to fulfil or observe the relevant standard of care; (iv) that this breach of duty caused damage or loss to the plaintiff; and (v) that such damage was not too remote a consequence of the breach. All of these elements must be satisfied, on a balance of probabilities, in order for the plaintiff to succeed in its action; see also, A. Linden, Canadian Tort Law, 5th ed. (Toronto: Butterworths, 1993).

1. Duty of Care

The case of Donaghue v. Stevenson, [1932] A.C. 562 (H.L.), first set out the test for determining whether the initial element of a negligence claim, a duty of care, has been established. Lord Atkin stated, at page 580, that one must take care to avoid acts or omissions which one can reasonably foresee would be likely to injure one"s neighbours. The House of Lords subsequently indicated, in Ann s v. Merton London Borough Council, [1978] A.C. 728, that a court, in determining whether or not a duty of care was owed in the case before it, must first ask whether, as between the alleged tortfeasor and the plaintiff, there is a sufficient relationship of proximity such that, in the reasonable contemplation of the former, carelessness on his part may be likely to cause damage to the latter; if this question is answered affirmatively, the court must then determine if the extension of liability is desirable from a practical or policy point of view.

Canadian National Railway Co. v. Norsk Pacific Steamship Co., [1992] 1 S.C.R. 1021, at page 1152, established that liability for economic loss will not be imposed in tort cases if there is no connection, or proximity, between the defendant"s negligent conduct and the plaintiff"s loss, which would make it just for the defendant to indemnify the plaintiff. In addition to the actual relationship between the parties, proximity may consist of various forms of closeness, including physical, circumstantial, causal, or assumed. In this regard, pure economic loss is prima facie recoverable where, in addition to negligence and foreseeable loss, there is sufficient proximity between the negligent act and the loss. Accordingly, in order for a duty of care to exist, there must be proximity between the plaintiff"s loss and the negligent conduct of the defendant, as well as a reasonable foreseeability that the plaintiff will suffer harm as a result of the acts or omissions of the defendant.

...

Furthermore, paragraph 3(a) of the Crown Liability and Proceedings Act (the "CLPA"), R.S.C. 1985, c. C-50, as amended, provides that the Crown may be vicariously liable in tort for the harmful acts and omissions of its servants. According to section 10 of the CLPA, the Crown will not be vicariously liable for its servant"s conduct unless such conduct could have given rise to a cause of action in tort against the servant personally. Crown liability in tort is therefore statutory in origin; it is also vicarious, not direct. Consequently, in order to impose liability under paragraph 3(a) of the CLPA, it generally must be shown that a servant of the Crown, acting within the scope of employment, violated a duty owed to the plaintiff. The plaintiff must also establish that injury was caused by the Crown servant, in a manner sufficient to draw personal liability: P. Lordon, Crown Law (Toronto: Butterworths, 1991), at pages 327, 335, and 340.18

     For the present purposes, I am satisfied that Mr. Justice Wetston"s summary is an accurate statement of the law.

     The relevant portions of the federal CLPA read as follows:

3. The Crown is liable in tort for the damages for which, if it were a private person of full age and capacity, it would be liable

(a) in respect of a tort committed by a servant of the Crown;...

10. No proceedings lie against the Crown by virtue of paragraph 3(a) in respect of any act or omission of a servant of the Crown unless the act or omission would apart from the provisions of this Act have given rise to a cause of action in tort against that servant or the servant's personal representative.

With respect to the Crown's liability arising out of the CLPA, Mr. Justice Linden of the Federal Court of Appeal summarized the Crown"s liability under that act as follows:

Pursuant to the Canadian Crown Liability Act, R.S.C. 1970, c. C-38, now R.S.C., 1985, c. C-50, therefore, an action in tort may now be brought in the Federal Court of Canada. Paragraph 3(a) of the Act states that the "Crown is liable in tort for the damages for which, if it were a private person of full age and capacity, it would be liable... in respect of a tort committed by a servant of the Crown." While there are still problems with this statute which have evoked calls for further reform, both federally and provincially, (see Ontario Law Reform Commission, Report on the Liability of the Crown (1989); Law Reform Commission of Canada, The Legal Status of the Federal Administration (1985)), they are not relevant in this case. Thus, pursuant to this legislation, if a servant of the Crown would be liable, the Crown is liable in tort for any damages caused by him.19

     Thus, in order to succeed in this action the plaintiff must establish either: a) a statutory breach (and the other elements of a negligence claim); b) that a tort was committed by a servant of the Crown in the course of employment for which the Crown is vicariously liable; or c) liability of the Crown as the occupier, owner, etc. of the St. Lawrence River.²⁰

The Duty of Care

a) The Common Law Duty

     To begin with it is necessary to determine what duty, if any, the Defendant owed to the Plaintiffs. This inquiry is necessary since no servant of the Crown can be personally liable if the Crown itself owes no duty to the Plaintiffs.²¹

     The Plaintiffs" submission on this point is that the Defendant owed a duty to all users of the St. Lawrence River to "maintain same at all times in a fully safe and operational condition". By "operational", counsel for the Plaintiffs meant that it was the C.C.G."s duty to maintain the St. Lawrence River in such a way that the Plaintiffs" vessels could transit without undue delays.²²

     In support of his submission, counsel for the Plaintiffs referred me to the decision of Just v. British Columbia²³ where the Supreme Court of Canada had occasion to examine the duty of care owed by the government of British Columbia to those who used public highways in that province. In that case the Appellant and his daughter had been on their way to a day of skiing at Whistler Mountain. A boulder weighing over a ton rolled down the mountain and landed on the Appellant"s car, seriously injuring the Appellant and killing his daughter. The Appellant instituted legal proceedings against the government of British Columbia alleging that the government had failed in its duty to properly maintain the highway.

     In Just the Supreme Court referred with approval to the decision of Lord Wilberforce in Anns v. Merton London Borough Council,²⁴ and to the decision of the majority of the Supreme Court in Kamloops (City of) v. Nielsen.²⁵ After referring to these authorities, Cory J. stated that it was sound to determine a priori whether the defendant owed the plaintiff a duty of care where negligence had been alleged against a government agency. Cory J. answered this question in the affirmative and explained it as follows:

In the case at bar the accident occurred on a well used major highway in the province of British Columbia. All the provinces across Canada extol their attributes and attractions in the fierce competition for tourist business. The skiing facilities at Whistler are undoubtedly just such a magnificent attraction. It would be hard to imagine a more open and welcoming invitation to use those facilities than that extended by the provincial highway leading to them. In light of that invitation to use both the facilities and the highway leading to them, it would appear that apart from some specific exemption, arising from a statutory provision or established common law principle, a duty of care was owed by the province to those that use its highways. That duty of care would extend ordinarily to reasonable maintenance of those roads. The appellant as a user of the highway was certainly in sufficient proximity to the respondent to come within the purview of that duty of care. In this case it can be said that it would be eminently reasonable for the appellant as a user of the highway to expect that it would be reasonably maintained. For the Department of Highways it would be a readily foreseeable risk that harm might befall users of a highway if it were not reasonably maintained. That maintenance could, on the basis of the evidence put forward by the appellant, be found to extend to the prevention of injury from falling rock.26

     Mr. Justice Cory concluded that there was a duty of care incumbent upon the government of British Columbia to reasonably maintain the roads used by the public in that province and that that duty extended "to the prevention of injury from falling rock". Mr. Justice Cory could not find any exemption from that duty either arising from a statutory provision or established by the common law.

     It is to be noted that the British Columbia Crown Proceeding Act²⁷ made the Crown liable as if it were an ordinary person. Just appears distinguishable from the case at bar because of this. However, Cory J. reaffirmed his views in Swinamer²⁸ even though the Nova Scotia Proceedings against the Crown Act²⁹ was, for all intents and purposes, identical to the CLPA.

     I turn now to the facts of this case to determine what Common Law duty, if any, the Crown had. Evidence was led with respect to the role and responsibilities of the Coast Guard. As I have already stated, the transcript of the examination on discovery by the Plaintiffs of Mr. Turner held on March 29, 1994 forms part of the evidence before me. The answers given by Mr. Turner to the questions posed by counsel for the Plaintiffs, which appear at pages 13 through 21 of his examination on discovery, accurately reflect the role played by the C.C.G. in regard to the marine services provided by the Department of Transport to the shipping industry and the general public.

Q      Now, you, of course, were here yesterday when Mr. Love of the Treasury Board was testifying. So, we don"t have to go back into a lot of that stuff.

I"ll cue some of my questions off of what we heard yesterday and if they"re not clear, of course, you"ll let me know.

We heard yesterday that when a collective agreement is about to expire or indeed, the collective agreement which was to expire with certain employees in the public sector on the thirty-first (31st) of December nineteen eighty-seven (1987), various procedures come into play.

One of which is for the Treasury Board to obtain from the various departments and divisions of the Canadian Government lists of people, whom those departments would consider essential for purposes of designation under Section 78 of the Public Service Staff Relations Act. So, just situate it there.

It"s my understanding that the Department of Transport determined that the Ships" Crews should be so listed. And my question is: within a labour context, when we talk about ships" crews, are we talking about all of the ships" crews which you have just mentioned?

Is this every person that gets on any one of these ships and does any one of these things for Coast Guard, which you have already enumerated?

A      By and large, that would be correct, because our normal process in these negotiations has been to seek the designation of all of our ships" crew personnel.

We don"t always get one hundred per cent (100%) of what we ask for. There"s a bit of give-and-take that takes place through the discussions between the employer represented by Treasury Board and the unions, of course.

But our objective has been to attempt to protect as much as possible of the services we provide through ships or by-ships, by being able to operate as much of the fleet as possible, in the event there ever was a strike situation.

To do so, we, of course, designate as many of the individuals as possible on board. Part of the rationale for that is that crews, of course, must meet the minimum crewing regulations on board ships, as you would be aware, and one cannot sail a ship with, for example, half (1/2) the legally-required crew.

Therefore, you attempt to insure you have the crew at a level which allows the ship to, not only sail legally, but to do its job properly.

Q      Now, in determining whom you are going to list or wish designated in preparing that list for Treasury Board, what is your overriding notion vis-à-vis what is essential and what is not essential?

A      Well, we place priorities on the different kinds of services we provide, but it must be kept in mind that many of the services the Coast Guard does provide are, of course, by their very nature, safety services.

And therefore, the designation process, in our view, is appropriate and it should be applied to, as I said, as broad a range as possible over our ships" crew positions.

If we were to be unsuccessful in that process or if, as has happened more recently because of a change in government policy, we are not allowed to propose the designation of all of the ships" crews, we then have to set priorities.

And our priorities are essentially established on the basis of search and rescue, protection of life being first, of course; and services provided for safety of shipping in particular being second (2nd); and services provided for movement of commerce and protection of the environment coming after those.

Q      Well, in terms of -- you know, when we write those intelligence tests, in the early days, they"d give you six (6) circles and one (1) square, and you had to pick out which was the different one!

The different one which stands out to me in that list you"ve just given, well, to your concerns in designation as commerce, because let me take -- well, it may be an absurd example, but just so I can get an understanding of this.

Why not just close the River and the Gulf? Would you be in a position to do that? Then, surely, it would be safe. Are you in a position to stop all marine traffic?

A      I think it would be debatable as to whether we"re in a position to stop all marine traffic, without there being a just cause or adequate cause, and the cause would have to be safety-related.

Obviously, in the absurd, so to speak, the safest river is one that has no traffic ...

Q      Right!

A      ... but that doesn"t do much for Canadian commerce, obviously.

Our objective, in terms of supporting Canadian transportation industry and the Canadian transportation infrastructure, is to insure that to the extent consistent with a reasonable level of safety, we keep traffic moving wherever possible.

Q      So, within the notion of designate for the purposes of and I think the Act says "safety and security" are the words, it seems to me that you"re telling me that there is an underlying notion that essential commerce, at least, will be maintained?

A      Obviously, if you have a situation like that, you again have to set priorities as to what commerce is essential and what isn"t, but the objective here and the fundamental that is in the Act itself, is this question of safety and security of the public.

And therefore, the designation process is designed to allow us to keep certain services operating with particular reference to that safety and security of the public that is inherent in the Act.

Now, I think you have to relate that, in other words, to the marine commerce question in the sense that we want to keep commerce moving, because that"s a departmental objective, of course, and a Coast Guard objective.

But we can only do so to the extent that we can also, at the same time, ensure that safety, the safety and security of the public.

...

Q      To say that -- so, I won"t play a role here, I"ll ask a question.

To say that commerce is an underlying aim of the department, yes, we all obviously understand that, but how do you square commercial considerations with a statute which talks only of safety and security of the public?

A      Well, clearly, there"s a balancing required there from time to time, but you have to, again, as I"ve mentioned, relate that to the fundamental objectives of the department and the Coast Guard.

We are able to use the process that"s contained within the Public Service Employment Act in order to keep certain operations going in a safe manner. That"s the objective of it.

As you say, you could obviously have ultimate safety by simply stopping all commerce. The objective is to continue to insure the safety of the public in whatever normal operations are happening, of course.

We are trying to protect safety. As I said, we set priorities internally within that at all times. We"re trying to deliver services that are specifically related to safety of navigation.

And when we get into this kind of situation where designations are appropriate, it"s with a view to maintaining of those safety services that we use the designation process.

Q      O.K., you"ve made it clear to me.

A      I"m sure that helps.

     There is no doubt that the C.C.G."s role in Canadian shipping is one that is essentially safety related. The prime objective of the C.C.G., as explained by Mr. Turner, is to enable maritime traffic to proceed without undue delay to the extent that such an objective is compatible with the C.C.G."s duty to ensure the safety and the security of those who use the waterways. However, one must not confuse an objective with a duty. It goes without saying that the C.C.G."s goal is not to ensure safety for the sake of safety. Were that the case, the C.C.G. would simply prohibit all marine traffic on the St. Lawrence River.

     In my opinion, the duty of care owed by the C.C.G. is to assure the safety of the public using the St. Lawrence River by whatever reasonable steps are necessary given the circumstances. In the case at bar, those circumstances include the fact that the Ships' Crews had exercised their legal right to strike and thus were not available to perform their usual tasks.

     No federal statute imposes any particular duty upon the C.C.G. or the Department of Transport. However, there are certain provisions of the Canada Shipping Act³⁰ which shed some light on the C.C.G."s duties. For example, s. 517 thereof provides that "all lighthouses, light ships, floating and other lights, lanterns and other signals, buoys and beacons, radio aids to marine navigation, anchors and landmarks.... are vested in Her Majesty, and are under the direct control and management of the Minister".

     Section 519(a) of the Shipping Act provides that the Governor in Council may make regulations with respect to the maintenance of aids to navigation vested in Her Majesty. In that respect, the Governor in Council enacted the Aids to Navigation Protection Regulations³¹ which includes the following definition:

"aid to navigation" means a buoy, beacon, lighthouse, lightship or any other structure or device installed, built or maintained for the purpose of assisting the navigation of vessels.

     As another example, s. 562.1(1) of the Shipping Act provides that the Governor in Council may, in order to promote "safe and efficient navigation or operation of ships or environmental protection", enact regulations with respect to a number of matters which include the maintenance and use of appropriate charts and nautical publications on board ships, the number and qualifications of navigation and engine room personnel on board these ships, the procedures and practice to be followed by ship personnel, etc., all with a view to "protecting persons, ships, etc.".

     When one examines closely the provisions of the Shipping Act and the regulations made pursuant to it, there is no doubt that the C.C.G."s primary responsibility is to ensure the safety and security of those using the waterways. If that can be done in a way that will enable the users to move their ships in the most efficient manner, so be it. However, that is not the role nor the duty of the C.C.G. Its duty is limited to ensuring the safety of those who use the waterways.

     For these reasons, I am unable to subscribe to counsel for the Plaintiffs" submission that the Defendant owed a duty to the Plaintiffs to maintain the St. Lawrence River at all times in a "fully safe and operational condition". The Defendant did not owe a duty to the Plaintiffs to take all reasonable means to enable them to transit the St. Lawrence River without delays.

     The evidence is clear that the Department of Transport, through the C.C.G., has assumed responsibility for the aids to navigation program, vessel traffic management, radio communications, certification and inspection of Canadian ships, certification of Canadian officers, ice breaking and search and rescue operations. By reason of the C.C.G."s assumption of these responsibilities I find that the C.C.G. owed a duty to the Plaintiffs and to the public to ensure their safety and security. However, I am not prepared to go further than that.

     b) Statutory Duty

     The Plaintiffs" allegations concerning s. 78 of the PSSRA can be found in paragraphs 6 through 9 of their statement of claim. Specifically, with respect to the Defendant"s duty under the legislation to designate the Ships" Crews, the Plaintiffs allege in paragraph 6 of their statement of claim that:

6.      In virtue of the Public Service Staff Relations Act, the Defendant through the Treasury Board has the power and duty, once a bargaining unit of the Public Service Alliance of Canada has notified its intention that any of the employees within said bargaining unit intend to exercise a right to strike, to make and file with the Public Service Staff Relations Board a list designating those employees which it considers necessary for the maintenance of essential services in respect of the safety and security of the public;

     In making this allegation, the Plaintiffs rely on s. 78 of the PSSRA which provides:

78. (1)      Notwithstanding section 77, no conciliation board shall be established for the investigation and conciliation of a dispute in respect of a bargaining unit until the parties have agreed on or the Board has determined pursuant to this section the employees or classes of employees in the bargaining unit, in this Act referred to as "designated employees", whose duties consist in whole or in part of duties the performance of which at any particular time or after any specified period of time is or will be necessary in the interest of the safety or security of the public.

(2)      Within twenty days after notice to bargain collectively is given by either of the parties to collective bargaining, the employer shall furnish to the Board and to the bargaining agent for the relevant bargaining unit a statement in writing of the employees or classes of employees in the bargaining unit who are considered by the employer to be designated employees.

(3)      If no objection to the statement referred to in subsection (2) is filed with the Board by the bargaining agent for the relevant bargaining unit within such time after the receipt thereof by the bargaining agent as the Board may prescribe, the statement shall be taken to be a statement of the employees or classes of employees in the bargaining unit who are agreed by the parties to be designated employees.

(4)      Where an objection to the statement referred to in subsection (2) is filed with the Board by the bargaining agent for the relevant bargaining unit within such time after the receipt thereof by the bargaining agent as the Board may prescribed, the Board, after considering the objection and affording each of the parties an opportunity to make representations, shall determine which of the employees or classes of employees in the bargaining unit are designated employees.

     Because the Public Service Staff Relations Board ("PSSRB") was of the view that there was a duty upon the employer to "designate" so as to ensure the safety and the security of the public, it concluded that ss. 78(2) was not mandatory and thus relieved the employer of its default.

     The Federal Court of Appeal, on a s. 28 application,³² set aside the Board"s decision. Mr. Justice Hugessen stated that there could be little doubt that the word "shall" which appears in ss. 78(2) was intended to be imperative. In Mr. Justice Hugessen"s view, however, the real issue was not whether the word "shall" was imperative or directory. The issue was whether the filing of a list of designated employees was a duty upon the employer or a power which the employer could, in its discretion, exercise. This is how Mr. Justice Hugessen formulated the question:

... The real problem, as it seems to me, is to know whether the furnishing of a list of proposed designated employees is a duty cast upon the employer or simply a power which it is free to exercise or not as it sees fit. If it is the former, the rule seems to be that the failure to perform the duty within the time or in the manner provided should not be held to deprive other interests of their rights. Put in the concrete terms of this case, if the government had a duty to designate employees, its failure to do so timely must not adversely affect the safety and security of the public.33 [footnote omitted]

Mr. Justice Hugessen answered his question as follows:

... While the government"s duty to act in the public interest cannot be doubted, that interest extends well beyond matters of safety or security. It must also include, as a reading of the Act as a whole makes clear, the right of public servants to adhere to the union of their choice, to bargain collectively, and ultimately to strike. Certainly the Act casts no specific duty on the employer to designate employees in every case while its obligations to bargain in good faith and not to interfere with the employee"s right of association are set out very clearly.

... It seems to me to be far more reasonable to read section 79 [now section 78] as allowing the employer to submit a list within the time prescribed and implying that, in the absence of a timely submission, the parties are presumed to have agreed that there are to be no designated employees within the relevant bargaining unit. Such a reading seems to me to be more in keeping with the scheme of the Act as a whole and with the general context of labour relations law and practice in Canada today.34

     Thus, the Court of Appeal concluded that there was no duty on the part of the employer to "designate". That is also my own view of the matter. It would not make sense to impose a legal duty on the Crown to file a list of designated employees and then to bar the Crown from performing that duty because it filed its list of designated employees outside the time provided in the PSSRA , whether by reason of negligence or otherwise. Mr. Justice Hugessen made this point crystal clear in his reasons when he stated that if the employer had a duty to designate, its failure to do so could not "adversely affect the safety and security of the public".

     The PSSRA was enacted to govern the labour relationship between the majority of public servants in Canada and their employer, the federal Crown. Although this statute does not create a duty pursuant to which the Defendant must "designate" employees, the Defendant`s failure to do so does not, in the instant case, relieve the C.C.G. of its duty to ensure the safety of the public.

     In Saskatchewan Wheat Pool the Supreme Court of Canada held that it is not necessary for a statute to specifically confer a private right of action provided that the plaintiff can make out the elements of a Common Law action of negligence. Dickson J. (as he then was) stated that:

For all of the above reasons I would be adverse to the recognition in Canada of a nominate tort of statutory breach. Breach of statute, where it has an effect upon civil liability, should be considered in the context of the general law of negligence. Negligence and its common law duty of care have become pervasive enough to serve the purpose involved for the existence of the action for statutory breach.

It must not be forgotten that the other elements of tortious responsibility equally apply to situations involving statutory breach, i.e. principles of causation and damages. To be relevant at all, the statutory breach must have caused the damage of which the plaintiff complains. Should this be so, the violation of the statute should be evidence of negligence on the part of the defendant.35

     Even prior to Saskatchewan Wheat Pool the breach of a statutory duty would only result in a finding of liability if a plaintiff could demonstrate that the damages suffered were of a kind that the statute intended to prevent.³⁶ In the event that I am wrong on the issue of the statutory duty, I will deal here with the PSSRA as if s. 78 imposed on the Crown an actual duty to file.

     Subsection 78(1) of the PSSRA provides that the employees who shall be designated are those employees whose duties "consist in whole or in part of duties, the performance of which at any particular time or after any specified period of time, is or will be necessary in the interest of the safety or security of the public". In my view, by the use of the words "in the interest of the safety or security of the public" Parliament has stated in clear terms that the employer shall designate those employees whose work is required to prevent bodily harm, loss of life and loss or damage to property.

     Counsel for the Plaintiffs submitted that the word "sécurité" should not be so confined. In support of that submission, counsel referred me to the Petit Larousse Illustré where the word "sécurité" is defined as follows:

confiance, tranquilité d"esprit résultant de la pensée qu"il n"y a pas de péril à redouter. Absence de risques d"accidents ...37

     The word "security" is defined, in a similar way, in The Shorter Oxford English Dictionary on Historical Principles:

The condition of being secure. The condition of being protected from or not exposed to danger; safety...38

     These definitions do not, in my view, support counsel"s argument that the word "sécurité" or "security" is intended to denote Parliament"s concern with risks or dangers which go beyond loss of life and loss or damage to property. The PSSRB appears to have taken the view that the words "in the interest of the safety and security of the public" do not cover loss or damage to property. In the Ships" Crews designated employment case,³⁹ the PSSRB refused to designate certain employees whom the Defendant had submitted for designation under ss. 79(1) (now 78(2)) of the PSSRA. The PSSRB dealt with the issue as follows:

For reasons to be given in writing, the Board finds that, although the duties of the oilers and firemen in the Department of National Defence on the East and West coast proposed for designation by the employer, other than those engaged on the fireboats, are duties that may be necessary in the interest of the safety and security of public property, such duties are not of such a nature that they are necessary in the interest of the safety and security of the public within the meaning of s. 79(1) of the Act. These employees are accordingly determined not to be designated employees.40

     Consequently, had the Defendant attempted to designate certain employees or classes of employees for the sole purpose of minimizing the inconvenience to the public or the economic hardship which some members of the public might suffer by reason of a strike, the PSSRB would not have accepted such a designation.⁴¹

     Consequently it is my view that section 78 of the PSSRA is of no help to the Plaintiffs.

Breach of the Common Law Duty

     In order to succeed, the Plaintiffs must establish that one or many Crown servants committed a tort for which the servant(s) could be held personally liable. The Plaintiffs must establish some sort of direct relation between, not "the Crown" and the Plaintiffs, but the individual servant(s) and the Plaintiffs. In general terms, the Plaintiffs must have relied on the servant(s) and the servant(s) must have known of the existence of the Plaintiffs.

     In The Cleveland-Cliffs Steamship Co. v. The Queen,⁴² Mr. Justice Rand of the Supreme Court of Canada clearly explained that a prerequisite to Crown liability under the CLPA was the personal liability of a Crown servant. He explained this in the following terms:

Assuming that the centre red buoy was outside the easterly channel line, there is nothing to show when or how it reached that position. Nor have there been shown any circumstances that could possibly lead to a cause of action against any servant of the Crown. The administration of navigation aids depends on the action by Parliament in voting money. But apart from that, the conditions under which a Crown servant can be held personally liable to a third person for failure to act in the course of a duty to the Crown require that there be intended to be created, as a deduction from the facts, a direct relation between the servant and the third person. The primary duty of the Crown servants is to the Crown; and the circumstances in which the servant can, at the same time, come under a duty to a third person are extremely rare. The rule laid down in Grossman v. The King is, as I interpret it, this: that the servant from the nature of his specific duty, a duty immediately related to action of the third person, is chargeable with knowledge that the latter, in his own conduct, is justifiably relying on the performance by the servant of that duty, and that the servant is chargeable with accepting the obligation toward the third person. In other words, between them a de facto relation of reliance and responsibility is contemplated. There are no such circumstances here. The government administration, as disclosed by the evidence, is of a general character, unrelated directly and immediately to any particular navigational work in these waters and with no acceptance by any of the public servants concerned of obligation toward the third person, nor any immediate reliance on the performance of individual duty related to the latter's use of a public work. Buoys are not warranted fixtures for navigation. Nothing has been shown of neglect in their original placement or of failure to discover their change of position. The "sweeping" and other work suggested to be done in the channel assumes a duty on the Crown, not on a servant. The placement and maintenance in position of these buoys is work under direction of a general character. As a public accommodation, their maintenance is, in relation to the individual servant, attended to only in the aspect of the duty to the employer. So far as the evidence shows, the direction and responsibility do not go beyond the departmental offices. The situation is not, then, one in which a personal liability is engaged by a Crown servant; and there being no basis for the claim against a servant, a prerequisite to a claim under s. 18(c) of the Exchequer Court Act against the Crown, the action on this ground must fail. It is not contended that a claim lies based on a duty owing by the Crown, and admittedly there is no such duty.43 [footnote omitted]

     The case of Warwick Shipping Ltd. v. The Queen⁴⁴ offers an interesting example of Mr. Justice Rand's explanation. In Warwick the Plaintiff's ship was damaged when, after sheering to port, the ship hit a submerged rock. The sheering resulted from the fact that the ship was piloted too close to a shoal and the water displaced by the ship banked off the shoal and knocked the ship off course. The Plaintiff alleged, inter alia, that a tort had been committed by servants of the Crown in that the navigation charts produced by the Crown and the Notices to Mariners which were issued to supplement the charts were incomplete and, as a result, misleading. Addy J. stated the test to be applied in an action under s. 3(a) as follows:

...it must be determined whether any servant of the Crown acted negligently in the performance of his duties as a servant of the Crown and in addition whether at law the servant could have been held liable to the plaintiff for that negligence. Should one of these two conditions not be fulfilled, then, the Crown will not be held liable.45

     Mr. Justice Addy explained that had the Crown been an ordinary person, he would have held it responsible for the Plaintiff"s damages resulting from misrepresentations made in issuing incomplete notices to mariners. However, since the Crown was not an ordinary person, the Plaintiff had to demonstrate that servants of the Crown had failed in the performance of their duty to the Plaintiff. On the evidence, Mr. Justice Addy concluded that the servants of the Crown against whom allegations had been made did not owe any duty to the Plaintiffs. Consequently, according to the terms of the CLPA , the Crown could not be found vicariously liable.

     In so holding, Addy J. stated:

On the basis of the above findings of fact and of my view of the law, I would, if the Crown were an ordinary defendant, find it responsible at law for any damage resulting from the misrepresentations made in issuing the incomplete notices to mariners which, having regard to the other information on chart 4426 might reasonably be expected to mislead any person wishing to follow a course into harbour on or immediately to the south of the range line.

...

I cannot, in the circumstances of this case, find that, as contemplated by the law, there exists any "direct relationship" between the plaintiff and the servant or servants of the Crown who neglected to perform his or their duty.

...

...Their duties were all exclusively owed to the Crown ex contractu and did not, even indirectly require them to have anything to do with those members of the public who ultimately would benefit or suffer from the consequences of their joint efforts. The only servant or servants who might possibly be found to be subject to any such relationship would be those who actually issued or ordered the issuing of the notices to the public. The plaintiff has failed to establish that any such servants were actually persons who personally possessed or would be expected to possess personally the special knowledge required to render them liable at law in their personal capacity for communicating the innocent misrepresentations in issue.

...

I would, for the above-mentioned reasons, dismiss the case on the basis that, in the present circumstances, no duty to take care was owed to the plaintiff by any servant of the Crown because no "direct relationship" or sufficient relationship existed between them to create that duty.46

     In the present case, I am urged to hold that a finding of negligence against public servants employed by the Treasury Board, is res judicata because the PSSRB found that the Treasury Board employees had been negligent in not filing the list of designated employees within the prescribed time. At page 46 of its July 17, 1989 decision, the PSSRB formulated its finding as follows:

In our view, all the above simply establishes that for want of better terms, it is the employer"s own inefficiency, negligence, and lack of foresight which caused the late filing of the designation statements for the employees employed by the Department of National Defence. Accordingly, the Board determines that this is not a proper case and "good cause" has not been shown to relieve the employer from the consequences of its default.47

     In order to properly understand the PSSRB"s finding, it must be remembered that the Ships" Crews groups were comprised of employees from a number of departments namely, Environment, Transport, Fisheries and Oceans, Public Works, and National Defence. The evidence adduced by the employer before the PSSRB was that all of the departments, except for the Department of National Defence, had provided to the Treasury Board, in a timely manner, their lists of designated employees. The Treasury Board witnesses explained before the PSSRB that they had not made the designation prescribed by ss. 78(2) of the PSSRA by December 14, 1987 because the relevant information required from National Defence had not been received. Be that as it may, the PSSRB did not consider that the reasons given by the employer for the late filing justified the granting of an extension of time.

     Plaintiffs" counsel submitted that I was bound to find that the public servants employed at the Treasury Board had been negligent in respect of the filing of the lists of designated employees because the PSSRB had so found and because the Federal Court of Appeal had upheld the finding of negligence in its decision of September 18, 1989. Specifically, counsel referred me to the Reasons for Judgment of Chief Justice Iacobucci (as he then was) where he stated:

I see no reason to disturb the holding of the PSSRB in this respect, especially in the light of its finding, which I again see no reason to differ with, that with respect to the Department of National Defence, it was the "employer"s own inefficiency, negligence, and lack of foresight which caused the late filing of the designation statements ....".48

     Counsel"s submission on this point is one that I cannot accept. The PSSRB"s finding of negligence, which the Court of Appeal refused to interfere with on a s. 28 application, is one that was made in the context of whether the employer should be granted an extension of time to designate certain employees. The PSSRB was not concerned with making findings of negligence which might give rise to liability on the part of the federal Crown. Consequently, the Court of Appeal"s decision cannot support counsel"s submission. If a finding of negligence is to be made, I will have to make it based on the evidence before me. In that respect, the parties have stipulated that the facts which are related in the decision made by the PSSRB are facts which, by admission, are in evidence before me.

     I turn now to an examination of the facts of this case to determine whether the omission by the Treasury Board employees to file the lists designating the Ships" Crews constitutes "negligence" as this term applies to the law of tort.

     Mr. Donald Love, special advisor to the Staff Relations Division of the Treasury Board Secretariat, who at the relevant time was the Director of Policy Adjudication and Representation of the Staff Relations Division of the Human Resource Policy Branch of the Treasury Board, explained that the Treasury Board is a committee of cabinet, composed of a number of ministers of the Crown. The mandate of the Treasury Board is, inter alia, to determine the terms and conditions of employment of public servants in Canada.⁴⁹

     Mr. Love testified that the Treasury Board Secretariat⁵⁰ was well aware that December 14, 1987 was the last day to file the relevant lists of designated employees. Mr. Love explained that because the Treasury Board had not received the information it required from the Department of National Defence, it decided not to file the lists relating to the other departments on time because the Treasury Board"s policy was not to file "on a staggered or piece-meal basis, ...". Mr. Love"s explanation appears at page 68 of the transcript of his examination on discovery⁵¹ and is as follows:

Our consideration had always been that we file the designation submission for all of the employing departments that have proposed designations at the same time.

We hadn"t ever taken the approach that we would make our submission on a staggered or piece-meal basis, that we would make one submission for the bargaining unit.

     Mr. Love also explained that prior to December 15, 1987 the Treasury Board had filed lists of designated employees beyond the time prescribed by ss. 78(2) of the PSSRA, and that the PSSRB had always relieved it of default. Thus, those responsible for the filing of the designated lists at the Treasury Board were not concerned with the late filing of the lists, including those which covered the Ships" Crews.

     It would be wise to remind ourselves of what Lord Atkin said in Donoghue v. Stevenson:⁵²

The rule that you are to love your neighbour becomes in law, you must not injure your neighbour; and the lawyer"s question, Who is my neighbour ? receives a restricted reply. You must take reasonable care to avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour. Who, then, in law is my neighbour? The answer seems to be - persons who are so closely and directly affected by my act that I ought reasonably to have them in contemplation as being so affected when I am directing my mind to the acts or omissions which are called in question.53

     In these circumstances, can it be said that Mr. Love and the other public servants working at the Treasury Board were negligent, in the sense that that negligence would give rise to a cause of action against them and their employer? In my view, the answer is no. The public servants in question did not owe a duty to the Plaintiffs. As Esher M.R. stated in Le Lievre v. Gould: "A man is entitled to be as negligent as he pleases towards the whole world if he owes no duty to them."⁵⁴

     The public servants working at the Treasury Board could not, in my view, have had the Plaintiffs in their contemplation when deciding whether the lists should be filed on December 14 or subsequently. It goes without saying that the designation process under the PSSRA is not a process created to deal with the C.C.G. and its Ships" Crews. Rather, the process is designed to cover the majority of public servants employed by the federal Crown. It will be recalled that the Government"s Services Resumption Act⁵⁵ not only ordered the return to work of the Ships" Crews but also the hospital services groups. Would, for example, the Treasury Board employees and hence, their employer the Federal Crown, be liable for claims relating to loss of life which might have resulted by reason of the failure to designate by December 14, 1987. The death of a patient, for example, would not be the consequence of the failure to designate but rather the consequence of a failure to provide adequate medical attention. Public servants could be found liable if it was determined that they had not taken all reasonable steps to protect the public given the circumstances of the case, i.e. that the hospital employees were on strike.

     The Plaintiffs" allegations in the present instance are to the effect that the Defendant breached its common law duty by reason of its failure to maintain the St. Lawrence River in a safe and operational condition. However, the Plaintiffs have not, in fact, made any reproach of the Department of Transport or the C.C.G., nor have they adduced any evidence, to demonstrate that there was a breach of that duty. The only allegation and the only evidence adduced before this Court was in respect of the failure to designate under s.78 of the PSSRA . In other words, the Plaintiffs" case is that the Defendant breached its duty to maintain the waterways in a safe and operational condition when it failed to make the proper designation. Even if I had been prepared to agree with the Plaintiffs with respect to the extent of the duty owed by the Defendant, I nonetheless would have concluded that the Defendant was not in breach of the duty owed to the Plaintiffs.

     As I have already made clear, the Defendant did not breach a statutory duty when it filed its lists of designated employees on December 15, 1989. Further, I have explained why I am of the view that the public servants employed by the Treasury Board of Canada did not owe a duty to the Plaintiffs in the circumstances of this case.

     The Plaintiffs further argued that I should not make any distinction between public servants employed by the Department of Transport and those employed by the Treasury Board on the ground that they were all, in effect, employees of the Crown. Although it is true that all public servants are employed by the Crown, it is relevant to consider the nature of the work performed, or which ought to have been performed, by those employees who allegedly committed a tort. Different consequences may result depending upon the nature of the work and the position occupied by the employee.

     In Just,⁵⁶ the Supreme Court found that public servants employed by the Department of Highways of the province of British Columbia had been negligent in the performance of their work and, as a result, their employer was found to be liable. However, Mr. Justice Cory opined that certain acts or decisions made by the Crown were not subject to tort liability at all. His explanation for that proposition is as follows:

The functions of government and government agencies have multiplied enormously in this century. Often government agencies were and continue to be the best suited entities and indeed the only organizations which could protect the public in the diverse and difficult situations arising in so many fields. They may encompass such matters as the manufacture and distribution of food and drug products, energy production, environmental protection, transportation and tourism, fire prevention and building developments. The increasing complexities of life involve agencies of government in almost every aspect of daily living. Over the passage of time the increased government activities gave rise to incidents that would have led to tortious liability if they had occurred between private citizens. The early governmental immunity from tortious liability became intolerable. This led to the enactment of legislation which in general imposed liability on the Crown for its acts as though it were a person. However, the Crown is not a person and must be free to govern and make true policy decisions without becoming subject to tort liability as a result of those decisions. On the other hand, complete Crown immunity should not be restored by having every government decision designated as one of "policy". Thus the dilemma giving rise to the continuing judicial struggle to differentiate between "policy" and "operation". Particularly difficult decisions will arise in situations where governmental inspections may be expected.57

     And further on he adds the following:

It may convenient at this stage to summarize what I consider to be the principles applicable and the manner of proceeding in cases of this kind. As a general rule, the traditional tort law duty of care will apply to a government agency in the same way that it will apply to an individual. In determining whether a duty of care exists the first question to be resolved is whether the parties are in a relationship of sufficient proximity to warrant the imposition of such a duty. In the case of a government agency, exemption from this imposition of duty may occur as a result of an explicit statutory exemption. Alternatively, the exemption may arise as a result of the nature of the decision made by the government agency. That is, a government agency will be exempt from the imposition of a duty of care in situations which arise from its pure policy decisions.

In determining what constitutes such a policy decision, it should be borne in mind that such decisions are generally made by persons of a high level of authority in the agency, but may also properly be made by persons of a lower level of authority. The characterization of such a decision rests on the nature of the decision and not on the identity of the actors. As a general rule, decisions concerning budgetary allotments for departments or government agencies will be classified as policy decisions. Further, it must be recalled that a policy decision is open to challenge on the basis that it is not made in the bona fide exercise of discretion. If after due consideration it is found that a duty of care is owed by the government agency and no exemption by way of statute or policy decision-making is found to exist, a traditional torts analysis ensues and the issue of standard of care required of the government agency must next be considered.

The manner and quality of an inspection system is clearly part of the operational aspect of a governmental activity and falls to be assessed in the consideration of the standard of care issue. At this stage, the requisite standard of care to be applied to the particular operation must be assessed in light of all the surrounding circumstances including, for example, budgetary restraints and the availability of qualified personnel and equipment.58

     The issue before the Supreme Court in Just was whether the decisions taken by the B.C. Department of Highways regarding rock inspections were policy or operational decisions. On the facts before him, Mr. Justice Cory had no difficulty concluding that the decisions in question were operational and thus were subject to the law of tort.

     In Swinamer,⁵⁹ Mr. Justice Cory reiterated the position taken in Just. However, in Swinamer, contrary to his ultimate conclusion in Just, Cory J. was of the view that the decision taken by the Department of Transportation to inspect and identify dead trees was one taken as a preliminary step in the policy making process. Cory J. further stated that, on the facts of the case, he could not find any negligence on the part of the Department of Transportation with respect to the survey carried out to determine what trees, if any, should be removed.

     A review of the facts in Just and Swinamer makes it obvious that the public servants, whose acts or omissions were being questioned by the Plaintiffs, were public servants engaged in what Mr. Justice Linden of the Federal Court of Appeal in Swanson referred to as "servicing".

[W]e are concerned here with differentiating between macro-decisions affecting the welfare of the nation, and micro-decisions which are more limited in their significance.

Another way of looking at this is to say that a government must be entitled to govern free of the restraints of tort law, but that when it is merely supplying services to citizens it should be subject to ordinary negligence principles...Such an immunity, therefore, is necessary, but it must be limited only to those functions of government that are considered to be "governing" and not available to those tasks of government that might be styled "servicing".60

     The distinction made by Mr. Justice Linden is one between "servicing" and "governing". Thus, if the acts or omissions of public servants fall into the category of "servicing" then they are subject to the law of negligence. However, if the acts and omissions fall in the category of "governing" they are beyond the reach of the law of tort. Linden J. further explained the distinction as follows:

There are, however, in addition to Crown liability hurdles, principles of tort law that complicate the situation. Courts are reluctant to second-guess decisions that are made in the political sphere because of their respect for the separation of powers theory and because they recognize that theirs is an "awkward vantage point from which to assess public policy decisions with multilateral implications." (see Feldthusen, Economic Negligence (2d ed. 1989) at page 284.) They have, therefore, created an immunity for certain types of governmental activities which cannot be attacked by means of a negligence action as long as they are done in good faith. Other acts of government are amenable to negligence actions, however. That there should be a sphere of government conduct that should be beyond the reach of tort law is not disputed; what is disputed, however, is the scope of that immunity. This Court must determine whether the impugned conduct of the officials of Transport Canada was subject to negligence law or whether it was outside its ambit.

A similar approach has been urged by Bailey and Bowman in the United Kingdom, who are critical of the excessive judicial use of the duty of care issue, which they contend is a "cruder device", instead of "leaving the matter to the issue of breach", a more subtle one. There is "plenty of scope", they say, "within ordinary tort principles for accommodating the policy considerations that might militate against the imposition of a duty of care upon a public authority or against holding an authority to be in breach of duty." ("Negligence in the Realms of Public Law - A Positive Obligation to Rescue?", [1984] Public Law 277, at pages 301 and 307.) In a further article, the same authors argue that the "policy/operational dichotomy has proved inadequate for the purpose of identifying the allegedly non-justiciable cases at a preliminary stage, and unhelpful in dealing with them on the merits. It merely raises an extra dimension of confusion..." They conclude by saying that, if it is to be used, "it should be confined to as narrow a scope as possible." ("The Policy/Operational Dichotomy - A Cuckoo in the Nest", [1986] C.L.J. 430, at pages 455-456.)

Professor Hogg, in his book Liability of the Crown (2nd ed., 1989) at page 124, prefers the word "planning", rather than policy, to identify those acts which need to be protected for it connotes "generality or complexity", which courts may have difficulty evaluating. The word "operational", he suggests, focuses on the "specific". In other words, we are concerned here with differentiating between macro-decisions affecting the welfare of the nation, and micro-decisions which are more limited in their significance.

Another way of looking at this is to say that a government must be entitled to govern free of the restraints of tort law, but that when it is merely supplying services to citizens it should be subject to ordinary negligence principles. In the words of Mr. Justice Cory, "the Crown ... must be free to govern." (See Just , supra at page 1239.) "It is not a tort for a government to govern" (see Jackson J., dissenting in Dalehite v. United States, supra, at page 57). Such an immunity, therefore, is necessary, but it must be limited only to those functions of government that are considered to be "governing" and not available to those tasks of government that might be styled "servicing".61

     The "servicing" versus "governing" distinction serves the same purpose as the "operational" versus "policy" distinction viz., to distinguish between acts of government which are subject to the law of negligence and those which are not. However, I find that the nomenclature used by Mr. Justice Linden more precisely exemplifies the distinction which the court must make and so I adopt it in my discussion of this case.

     In Swanson, the acts and omissions at issue were those of public servants employed by Transport Canada. Specifically, these employees were inspectors of airlines, aircrafts and pilots whose job was not to make policy but to implement policies and regulations made at a higher level. There was no doubt that these employees, if sued personally, would have been held liable for their negligence since they clearly owed a duty of care to the Plaintiffs.

     In Swanson, a Piper Chieftain aircraft owned by Wapiti Aviation Ltd. had crashed near High Prairie, Alberta, killing six passengers. Wapiti had breached air navigation orders enacted pursuant to the Aeronautics Act⁶² on a number of occasions and complaints had been made to Transport Canada in that regard. As a result of the complaints, an inspector of Transport Canada issued a report outlining the various breaches. Months after the first report, another report was issued by a different inspector employed by Transport Canada and this report warned that unless the airline changed its ways "we are virtually certain to be faced with a fatality".

     Mr. Justice Linden concluded that, in the circumstances of the case, Transport Canada had breached the duty of care it owed to the passengers of the aircraft. Mr. Justice Linden stated that:

Transport Canada"s failure to take any meaningful steps to correct the explosive situation which it knew existed at Wapiti amounted to a breach of the duty of care it owed the passengers. Transport Canada officials negligently performed the job they were hired to do; they did not achieve the reasonable standard of safety inspection and enforcement which the law requires of professional persons similarly situated. It was not reasonable to accept empty promises to improve where no improvement was forthcoming. It is incomprehensible that a professional inspector of reasonable competence and skill would choose not to intervene in a situation which one of this own senior staff predicted was virtually certain to produce a fatal accident. The Trial Judge summarized Transport Canada"s attitude to Wapiti as follows [at pages 143 and 147 F.T.R.]:

In most instances where infractions of the regulations were called to Wapiti"s attention or threats of suspension were made, Dale Wells was able to persuade the Department that notice had been taken of the complaints and that the airline would do better in the future. Evidently this was believed.

....

In the present case it is true that action was contemplated against Wapiti and a few steps had been taken during the preceding year but in the place of decisive action the defendant"s employees had been satisfied with Wapiti"s promises to do better.

Such was Regional Inspector Davidson"s response to the situation at Wapiti. It is not possible to reconcile this approach with that of a professional person of reasonable care and skill whose duty it was to protect passenger safety.63

     In the case at bar, I am of the view that the public servants employed at the Treasury Board were not in "servicing". Rather, they were in what Mr. Justice Linden referred to as "governing". Subsection 6(4) of the Financial Administration Act⁶⁴ makes it clear that the public servants employed at the Treasury Board are so employed "for the proper conduct of the business of the Treasury Board". The business of the Treasury Board is set out in ss. 7(1) of the Financial Administration Act⁶⁵ which provides the following:

7. (1) The Treasury Board may act for the Queen"s Privy Council for Canada on all matters relating to

(a) general administrative policy in the public service of Canada;

(b) the organization of the public service of Canada or any portion thereof, and the determination and control of establishments therein;

(c) financial management, including estimates, expenditures, financial commitments, accounts, fees or charges for the provision of services or the use of facilities, rentals, licences, leases, revenues from the disposition of property, and procedures by which departments manage, record and account for revenues received or receivable from any source whatever;

(d) the review of annual and longer term expenditure plans and programs of departments, and the determination of priorities with respect thereto;

(d.1) the management and development by departments of lands, other than Canada Lands as defined in subsection 24(1) of the Canada Lands Surveys Act;

(e) personnel management in the public service of Canada, including the determination of the terms and conditions of employment of persons employed therein;

(e.1) the terms and conditions of employment of persons appointed by the Governor in Council that have not been established under this or any other Act of Parliament or order in council or by any other means; and

(f) such other matters as may be referred to it by the Governor in Council.

     The Treasury Board is, for the purposes of the PSSRA, the employer of most federal public servants.⁶⁶ One of the responsibilities incumbent upon the Treasury Board, pursuant to ss. 7(1)(i) of the Financial Administration Act⁶⁷ is the determination of the terms and conditions of employment for the public service. Simply put, it is up to the Treasury Board to decide what wages the various public servants should receive. By reason of the enactment of the PSSRA, Parliament has allowed its employees to constitute organizations to bargain for the terms and conditions of their employment. Failing agreement, Parliament has also allowed its employees to go on strike. Before being entitled to strike, the process created in the PSSRA obliges the public servants to go through "conciliation" whereby a conciliator is appointed by the Chairman of the PSSRB whose mandate is to "confer with the parties and endeavour to assist them in reaching an agreement".

     It will be recalled that under ss. 78(1) of the PSSRA no conciliation board can be established before a determination has been made by the PSSRB with respect to "designated employees". However, the determination of "designated employees" will only take place if the employer files a list of "designated employees" within 20 days of receipt of a notice to bargain collectively from the employee organization.

     In carrying out their duties under the PSSRB, the Treasury Board employees requested the individual departments to provide them with the names of those employees who should be "designated". It was not disputed that the Department of Transport had complied with the Treasury Board"s request and had provided the relevant names. As I have already indicated, the lists were filed one day late because the Department of National Defence had not been diligent. Mr. Love explained why the names of those employees which the Department of Transport had indicated should be "designated" were not filed by December 14, 1987. It is clear that the Department of Transport and hence the C.C.G. had no say whatsoever with respect to the manner in which the collective bargaining process was being handled by the Treasury Board.

     In my view, the omission to designate in a timely manner per ss. 78(2) of the PSSRA is not subject to the law of tort. I do not wish to be taken as saying that there can never be occasions where acts or omissions by public servants at the Treasury Board might give rise to tortious liability but certainly, in the present circumstances, the so-called failure to designate by December 14, 1987 is beyond the reach of the law of tort.

     The failure to designate on or before December 14, 1987 is in the same category as a failure to make a better offer to the public servants. It cannot be disputed that if the Ships" Crews had been designated on time the delays encountered by the Plaintiffs" ships would have been greatly reduced. It also cannot be disputed that if the Treasury Board had made a better offer to its employees thereby avoiding the strike, the delays suffered would also have been greatly reduced. However, in both cases, the omissions are not within the reach of the law of tort. I wish to conclude this part of my reasons by stating

that the Defendant was under no duty to avoid or settle the strike. The Defendant could have prevented the strike or could have terminated it earlier than December 15, 1989 but it did not do so for reasons which are outside the jurisdiction of this Court to consider.

     For the sake of clarity I will set out a brief summary of my findings thus far:

1.      Crown liability results from a breach of a statutory duty or vicariously for a tort committed by a Crown servant.

2.      The objective of creating and maintaining conditions for efficient transit on the St. Lawrence River does not create a Common Law duty. However, there is a Common Law duty imposed on the C.C.G. to ensure the safety of the users of the St. Lawrence River by taking whatever reasonable steps are necessary given the circumstances.

3.      There is no statutory duty found in the PSSRA requiring the Treasury Board to file.

4.      Even if s. 78 does impose a duty on the Treasury Board employees to file a list for purposes of safety and security, the scope of that duty would only extend to prevention of bodily harm, loss of life and damage to property.

5.      The finding of negligence against the Treasury Board employees by the PSSRB (and upheld by the F.C.A.) does not amount to res judicata in this case.

6.      The employees of the Treasury Board did not owe a duty to the Plaintiffs. The fact that the Plaintiffs were known to the C.C.G. does not help the Plaintiffs as the only deed reproached in this case was an omission by a Treasury Board official.

7.      There has been no allegation nor evidence that the Defendant breached its duty to ensure the safety of the users of the St. Lawrence River. Further, even if I had agreed with the Plaintiffs with regard to the extent of the duty owed by the Defendant to the Plaintiffs, i.e. that the Defendant had a duty to maintain the St. Lawrence River in a "safe and operational" state, the Defendant, in my view, would not have been in breach of that duty. The Plaintiffs did not adduce any evidence to the effect that the Defendant had breached the duty they alleged. On the contrary, the Defendant appears to have taken all reasonable steps to ensure the safety of the public and to allow maritime traffic to move in an efficient manner given the prevailing circumstances.

8.      Ultimately, the actions of the Treasury Board are governing and not servicing. For this reason the decisions and actions of the Treasury Board employees are, in these circumstances, beyond review by the courts.

---

Damages

     I will now set out my findings with regard to the Plaintiffs" quantum. In other words, had I found for the Plaintiffs on the issues of duty and breach of duty, I would have been prepared to allow the Plaintiffs the following amount of damages.

     The Plaintiffs" claim against the Defendant is in the sum of $2,690.360.00. This sum is arrived at as follows:

     i) Loss of revenue      $ 2,600,360.00

     ii) Additional expenses      90,000.00

     During the course of the trial, the Defendant conceded that if the Plaintiffs were successful, they were entitled to expenses in the sum of $90,000.00. However, the Defendant did not concede anything in regard to the claim for loss of revenue.

     The evidence led by the Plaintiffs in regard to loss of revenue was, in fact, not complicated. Mr. Tom Brodeur, Vice-President Marketing for the Plaintiffs, was the only witness who gave evidence on the issue of quantum. At the relevant time, Mr. Brodeur was the Director of Transportation and Customer Services for the Plaintiffs.

     Mr. Brodeur explained that in 1989, the Plaintiffs" ships had not been able to carry all of the cargoes which had been committed to them pursuant to contracts entered into with a number of shippers and receivers. Specifically, Mr. Brodeur"s evidence was that fourteen trips had not been performed. According to Mr. Brodeur, the Plaintiffs had always completed their contracts in previous years. The 1989 season was the only time contracts were not filled. Mr. Brodeur attributed this to the strike and more particularly to the fact that the Ships" Crews were not working.

     To support his assertion, Mr. Brodeur explained that he had calculated, by reference to the log books of the fifteen ships, that the total number of days lost by the ships at the relevant time was 150.38. According to Mr. Brodeur, 128 days would have been required to complete the fourteen trips.

     The Defendant"s position on this issue was that the delays which appear in the log books of the fifteen ships cannot be attributed directly to the fact that the Ships" Crews were on strike. For example, counsel for the Defendant argued that following the collision of the ENERCHEM ASPHALT with the upper gates of the St. Lambert lock, the St. Lawrence Seaway System was closed for almost 2.5 days. Counsel argued that this delay did not result from the strike. Counsel also argued that the weather which prevailed in November and December 1989 was a major cause of the delays encountered by the Plaintiffs" ships. In this respect, counsel relied on the evidence of the Defendant"s expert, Mr. Fred Parkinson. According to Mr. Parkinson, the ships in transit in the St. Lawrence River in November and December of 1989 would have been delayed even if there had not been a strike of the Ships" Crews. Mr. Parkinson opined that this was due to the "early rapid accumulation and quantity of ice".⁶⁸

     As I indicated earlier in my reasons, it was a particularly bad year to have a strike of the Ships" Crews because of the difficult weather conditions. It is difficult to argue with Mr. Parkinson"s proposition that delays would have occurred even if there had not been a strike. However, the question is whether the Plaintiffs would have been able to perform the fourteen trips which were not performed.

     I have come to the conclusion that, in all likelihood, the majority of these trips would have been performed. Notwithstanding the difficult weather conditions, if the ice breakers had been in service and the Ships" Crews had proceeded to remove the summer buoys when it was realized that the cold weather was "here to stay", it is my view that delays to navigation would have been kept to a minimum.

     Mr. Brodeur"s evidence with respect to the Plaintiffs" quantum was not seriously challenged and I see no reason not to accept his evidence. Consequently, had I found that the Defendant owed the duty alleged by the Plaintiffs and that the Defendant had breached that duty, I would have allowed the Plaintiffs 80% of the amount which they claim as loss of revenue. Thus I would have allowed the Plaintiffs the sum of $2,000,080.00. In addition, I would have allowed the sum of $90,000.00 for additional expenses which the Defendant has conceded.

Conclusion

     For these reasons, the Plaintiffs action shall be dismissed with costs in favour of the Defendant.

    

     Judge

Ottawa, Ontario

December 3, 1996

__________________

     ¹      At the commencement of the trial, I was informed by counsel that this action was a test case.

     ²      By their statement of claim, the Plaintiffs claimed the sum of $4,868,546.10. During the course of the trial, the Plaintiffs reduced their claim to the sum of $2,690,360.00.

     ³      R.S.C. 1985, c. C-50 [hereinafter CLPA ].

     ⁴      R.S.C. 1985, c. P-35 [hereinafter the PSSRA ].

     ⁵      The Ships" Crews groups were entitled to go on strike legally as of November 11, 1989. However, they refused to work on November 10, 1989.

     ⁶      S.C. 1989, c. 24.

     ⁷      This document is Tab 9 of the Defendant"s productions, Vol. 3-A, produced as part of Exhibit P-3.

     ⁸      U.T.C.: Universal time coordinates.

     ⁹      C.R.I.: Centre régional d"information.

     ¹⁰      Mr. Turner was examined on discovery by the Plaintiffs on March 29, 1994. The trasncript of his examination was filed as an exhibit during the course of the trial and thus is part of the evidence before me.

     ¹¹      For a general discussion of the history of Crown immunity see P.W. Hogg, Liability of the Crown , 2d ed. (Toronto: Carswell, 1989).

     ¹²      See Farnell v. Bowman (1887) 12 App. Cas. 643 (P.C., Aust.); Brabant & Co. v. King [1985] A.C. 632 (P.C., Aust.); Evans v. Finn (1904) 4 S.R. (N.S.W. 297 (F.C.)).

     ¹³      Hogg, supra note 11 at 82. "On a public work" was changed to "while acting within the scope of his duties or employment" in 1938. See also McArthur v. The King [1943] Ex. C.R. 77.

     ¹⁴      S.C. 1952-53, c. 30.

     ¹⁵      CLPA, supra note 3, s. 2.

     ¹⁶      See the discussion of [1983] 1 S.C.R. 205">The Queen v. Saskatchewan Wheat Pool, [1983] 1 S.C.R. 205 [hereinafter Saskatchewan Wheat Pool] at text accompanying note 35.

     ¹⁷      Olympia Janitorial Supplies (136971 Canada Ltd.) v. Canada (Minister of Public Works) (July 24, 1996), Ottawa T-2294-89 (F.C.T.D.).

     ¹⁸      Ibid. at 4-7. Wetston J."s summary of Norsk is essentially a summary of the reasons for judgment delivered by Madame Justice McLachlin. Mr. Justice Cory and Madame Justice L"Heureux-Dubé concurred in the reasons of Justice McLachlin. Stevenson J., although agreeing with the conclusion reached by McLachlin J. did not agree with her reasons. Finally, La Forest J. dissented from the majority opinion. Iacobucci J. and Sopinka J. agreed with the reasons given by La Forest J.

     ¹⁹      Swanson v. Canada (Minister of Transport), [1992] 1 F.C. 408 (C.A.) [hereinafter Swanson] at 418-419.

     ²⁰      There was no allegation on the third head and thus it is not considered in these reasons.

     ²¹      Note that I am not dealing here with direct Crown liability because I am looking to the Common Law for the duty. Whether there is a pertinent statutory duty imposed on the federal Crown will be discussed below.

     ²²      I should point out that the parties were unable to refer me to any statute, nor have I been able to find one, which imposes upon the Crown a duty in respect of the St. Lawrence River.

     ²³      [1989] 2 S.C.R. 1228 [hereinafter Just ].

     ²⁴      [1978] A.C. 728.

     ²⁵      [1984] 2 S.C.R. 2">[1984] 2 S.C.R. 2.

     ²⁶      Supra note 23 at 1236.

     ²⁷      R.S.B.C. 1979, c. 86, s. 2.

     ²⁸      [1994] 1 S.C.R. 445. The Plaintiff in this case was rendered a paraplegic when a tree fell onto his truck while he was driving on a public highway. The Department of Transportation had surveyed the trees in the area of the accident only shortly before but had not marked this tree as a potential hazard. Cory J. held that the decision to inspect the trees was preliminary to the establishment of a policy on the subject as it involved questions of allocation of funds and expenditures.

     ²⁹      R.S.N.S. 1989, c. 360, paragraph 5(1)(a).

     ³⁰      R.S.C. 1985, c. S-9 [hereinafter the Shipping Act ].

     ³¹      C.R.C., c. 1403.

     ³²      Federal Court Act, R.S.C. 1970 (2d Supp.) c. 10 (now R.S.C. 1985, c. F-7).

     ³³      Public Service Alliance of Canada v. Canada, [1989] 2 F.C. 445 at 448 (F.C.A.).

     ³⁴      Ibid. at 449-450.

     ³⁵      Saskatchewan Wheat Pool, supra note 16 at 225-226.

     ³⁶      See generally, Allen M. Linden, Canadian Tort Law , 5th ed. (Toronto: Butterworths, 1993) at 206-209.

     ³⁷      Le Petit Larousse Illustré, (Paris: Librairie Larousse, 1979) at 935.

     ³⁸      W. Little, H.W. Fowler & J. Coulson, The Shorter Oxford English Dictionary on Historic Principles , 3d ed. (Oxford: University Press, 1973) at 1927.

     ³⁹      ( November 2, 1970), No. 181-2-10 (P.S.S.R.B.).

     ⁴⁰      Ibid. at 16.

     ⁴¹      For a summary of the view taken by the PSSRB on this matter, see Jacob Finkelman and Shirley B. Goldenberg, Collective Bargaining in the Public Service: The Federal Experience in Canada , vol. 2, (Montreal: Institute for Research on Public Policy, 1984) at 483 ff.

     ⁴²      [1957] 1 S.C.R. 810">[1957] 1 S.C.R. 810.

     ⁴³      Ibid. at 814-815.

     ⁴⁴      [1982] 2 F.C. 147 [hereinafter Warwick ], aff'd. (1983), 48 N.R. 378 (F.C.A.).

     ⁴⁵      Ibid. at 164.

     ⁴⁶      Ibid. at 170-172.

     ⁴⁷      (July 17, 1989) No. 181-2-269, 270, 277 (P.S.S.R.B.).

     ⁴⁸      Canada (A.G.) v. Public Service Alliance of Canada (18 September 1989), Ottawa No. A-321-89 (F.C.A.) at 8.

     ⁴⁹      Section 5 of the Financial Administration Act , R.S.C. 1985, c. F-11 provides for the establishment of a Committee of the Queen"s Privy Council for Canada, called the Treasury Board. Section 7 of the Act sets out the responsibilities of the Treasury Board and, in particular, provides that the Treasury Board shall have responsibility for determining the terms and conditions of employment of persons employed in the Public Service of Canada.

     ⁵⁰      Section 6(2) of the Financial Administration Act , ibid. provides that the Governor in Council may appoint a "secretary of the treasury" to perform the duties and functions assigned to him by the Treasury Board. Section 6(4) of the Act provides for the appointment of other officers and employees "necessary for the proper conduct of the business of the Treasury Board...".

     ⁵¹      Mr. Love was examined on discovery by the Plaintiffs on March 28, 1994.

     ⁵²      [1932] A.C. 562.

     ⁵³      Ibid. at 580.

     ⁵⁴      [1893] 1 Q.B. 491 at 497 (C.A.).

     ⁵⁵      Supra note 6.

     ⁵⁶      Supra note 23. In Swinamer, supra note 28, the court considered the actions of the Department of Transportation but found that they were not negligent on the facts. However, had they been negligent it is clear that the Crown would have been liable for the actions of its servants.

     ⁵⁷      Ibid. at 1239.

     ⁵⁸      Ibid. at 1244-1245.

     ⁵⁹      Supra note 28.

     ⁶⁰      Supra note 19 at 423.

     ⁶¹      Ibid. at 419-423.

     ⁶²      R.S.C. 1985 c. A-2.

     ⁶³      Swanson, supra note 19 at 433-434.

     ⁶⁴      Supra note 49.

     ⁶⁵      Ibid.

     ⁶⁶      Section 2 of the PSSRA defines the term "employer" as follows:          "employer" means Her Majesty in Right of Canada as represented by              (a) in the case of any portion of the public service of Canada specified in Part I of Schedule I, the Treasury Board, and              (b) in the case of any portion of the public service of Canada specified in Part II of Schedule I, the separate employer concerned;          The Ships Crews employed by a number of departments, fall under Part I of Schedule I. Thus, for those employees, the Treasury Board was the Crown"s representative for purposes of employment.

     ⁶⁷      Supra note 49.

     ⁶⁸      Exhibit D-2 at 16.