Present:
Dickson C.J. and Beetz, McIntyre, Lamer and La Forest JJ.
on appeal from the court of appeal for ontario
Statutes‑‑Interpretation‑‑Retrospective
operation‑‑Statutes barring action in effect when accident occurred‑‑Statutes
barring action repealed before action commenced‑‑Whether or not
repeal operating retrospectively‑‑Married Woman's Property Act,
R.S.O. 1970, c. 262, s. 7‑‑Insurance Act, R.S.O. 1970, c. 224, s.
214(b)(i)‑‑Family Law Reform Act, 1975, S.O. 1975, c. 41, ss.
1(3)(a), 5, 6.
Family
law‑‑Spousal immunity‑‑Statutes barring action in
effect when accident occurred‑‑Statutes barring action repealed
before action commenced‑‑Whether or not repeal operating
retrospectively.
Respondent
Diane Angus had been a passenger in a car driven by her husband, respondent
James Angus, and was seriously injured in an accident caused by his own
negligence. The car was owned by Diane Angus' father, Owen Hart. Diane Angus
brought action against her husband and her father to recover damages. Diane and
James Angus have since been divorced. At the time of the accident, s. 7 of The
Married Woman's Property Act prevented spouses' suing each other in tort
and s. 214 of The Insurance Act provided that an insurer was not liable
for liability resulting from the bodily injury or death of a daughter, son,
wife or husband. The Family Law Reform Act, 1975 repealed these
provisions after the accident but before the suit was commenced. The father's
insurance policy on the car also contained a provision absolving the appellant
insurance company from third‑party liability in terms similar to those of
s. 214. The principal issue here was whether The Family Law Reform Act, 1975
operated retrospectively so as (1) to permit one spouse to bring an action in
respect of a tort committed by the other before the Act's commencement and (2)
to eliminate s. 214 of The Insurance Act as a defence to the action
against the insurance company.
Held: The
appeal should be allowed.
A
provision is substantive or procedural for the purposes of retrospective
application not according to whether or not it is based upon a legal fiction,
but according to whether or not it affects substantive rights. Here, procedure
was not being affected at all. The provision in question provided a complete
defence to an action and as such is a substantive matter just as much as the
creation of a cause of action itself. In any case, whether the provision is
deemed to be substantive or procedural, it is not one to which a presumption of
retrospectivity can be applied. This would amount to a serious deprivation of
an acquired right of the husband, and it should not lightly be assumed that
this was the intention of the legislature.
Section
214 of The Insurance Act operated as a bar to recovery against the
father's insurance company. This section, too, was a substantive provision to
which the ordinary principle against retrospective operation applied.
Cases
Cited
Disapproved: Broom
v. Morgan, [1953] 1 Q.B. 597; referred to: Manning v. Howard
(1975), 8 O.R. (2d) 728; Howard Smith Paper Mills Ltd. v. The Queen,
[1957] S.C.R. 403; Maxwell v. Callbeck, [1939] S.C.R. 440; Midland
Bank Trust Co. v. Green (No. 3), [1979] 2 All E.R. 193; Upper Canada
College v. Smith (1920), 61 S.C.R. 413; Merrill v. Fisher (1975), 11
O.R. (2d) 551; Martin v. Perrie, [1986] 1 S.C.R. 41; Foy v. Foy
(1978), 20 O.R. (2d) 747; Phillips v. Barnet, [1875‑76] 1 Q.B.D.
436.
Statutes
and Regulations Cited
Contributory Negligence Act, S.A. 1937, c. 18.
Family Law Reform Act, 1975, S.O. 1975, c. 41,
ss. 1(3)(a), 5, 6.
Insurance Act, R.S.O. 1970, c.
224, s. 214(b)(i).
Married Woman's Property Act, R.S.O. 1970, c.
262, s. 7.
Rules of
Civil Procedure, Rule 21, formerly Rules of Practice, s. 124.
Authors
Cited
Côté, Pierre‑André. The Interpretation of
Legislation in Canada. Cowansville, Quebec: Yvon Blais, 1984.
Driedger, Elmer A. Construction of Statutes, 2nd
ed. Toronto: Butterworths, 1983.
Maxwell, Sir Peter B. Maxwell on Statutory
Interpretation, 12th ed. By P. St. J. Langan. London: Sweet & Maxwell,
1969.
APPEAL
from a judgment of the Ontario Court of Appeal (1986), 53 O.R. (2d) 793,
dismissing an appeal from a judgment of Galligan J. (1984), 45 O.R. (2d) 667.
Appeal allowed.
John
Nelligan, Q.C., and Stuart Hendin, Q.C.,
for the appellant.
David
M. McFadyen, for the respondent Diane Hart Angus.
Rodger
Brennan, for the respondents Owen Hart and James Angus.
The
judgment of the Court was delivered by
1. La Forest J.‑‑The
principal issue in this appeal is whether ss. 1, 5 and 6, of The Family Law
Reform Act, 1975, S.O. 1975, c. 41, which provide that spouses have
separate legal personalities and have a right to bring an action in tort
against one another, operate retrospectively, so as to permit one spouse to
bring such an action in respect of a tort committed by the other before the
Act's commencement.
Facts
2. On
April 30, 1975, the respondent Diane Angus was seriously injured in a car
accident. Her husband, respondent James Angus, was driving the car in which she
was a passenger. The accident was caused by his own negligence. The car was
owned by Diane Angus' father, Owen Hart. On April 5, 1977, Diane Angus brought
action against her husband and her father to recover damages for the injuries
and losses she sustained from the accident. Diane and James Angus have since
been divorced.
3. At
the time of the accident, two provisions of law would have barred recovery.
Section 7 of The Married Woman's Property Act, R.S.O. 1970, c. 262,
provided:
7. Every married
woman has in her own name against all persons, including her husband, the same
remedies for the protection and security of her own separate property as if
such property belonged to her as a feme sole, but, except as aforesaid
no husband or wife is entitled to sue the other for a tort.
Section 214
of The Insurance Act, R.S.O. 1970, c. 224, provided in relevant part as
follows:
214. The insurer is
not liable under a contract evidenced by a motor vehicle liability policy for
any liability,
...
(b) resulting from bodily
injury to or the death of,
(i) the daughter, son, wife or
husband of any person insured by the contract . . . .
4. The
father's insurance policy on the car itself contained a provision absolving the
appellant insurance company from third‑party liability in terms similar
to those of s. 214.
5. Slightly
more than two months after the accident, but well before the suit was
commenced, the above provisions were repealed by ss. 5 and 6 of The Family
Law Reform Act, 1975. As well, ss. 1 and 5 of that Act provide in relevant
part:
1.‑‑(1) For
all purposes of the law of Ontario, a married man has a legal personality that
is independent, separate and distinct from that of his wife and a married woman
has a legal personality that is independent, separate and distinct from that of
her husband.
...
(3) Without limiting the
generality of subsections (1) and (2),
(a) each of the parties to a
marriage has the like right of action in tort against the other as if they were
not married;
...
5. Subclause i of
clause b of section 214 of The Insurance Act, being chapter 224
of the Revised Statutes of Ontario, 1970 is repealed.
The Courts
Below
6. An
application (pursuant to s. 124 of the Rules of Practice; see now Rule
21 of the Rules of Civil Procedure) was brought before Galligan J. of
the Supreme Court of Ontario ((1984), 45 O.R. (2d) 667) for a determination as
to whether or not the provisions just quoted operated retrospectively so as to
eliminate defences based on s. 7 of The Married Woman's Property Act and
s. 214 of The Insurance Act. The motion also sought an order that the
statement of claim disclosed no reasonable cause of action against the husband,
the father or the insurance company.
7. Galligan
J. determined that these provisions of The Family Law Reform Act, 1975
did operate with retrospective effect, and the defences were not available. The
two basic issues before him were these:
1. Is section 7 of The Married Woman's Property
Act a defence to the action against James Angus, or do the provisions of The
Family Law Reform Act, 1975 operate retrospectively to eliminate this
defence by repealing s. 7?
2. Is section 214 of The Insurance Act a
defence to the action against the insurance company, or do the provisions of The
Family Law Reform Act, 1975 operate retrospectively and eliminate this
defence by repealing s. 214?
8. Galligan
J. began, at p. 669, by recognizing the "fundamental rule" of
statutory interpretation that
...no legislation is to be construed as being
retrospective in operation so far as substantive rights and obligations are
concerned unless the statute clearly provides or such retrospective operation
is required by clear implication. A procedural enactment, however, is prima
facie to be given a retrospective interpretation unless it would prejudice
a substantial right of a party.
9. Galligan
J. relied on Manning v. Howard (1975), 8 O.R. (2d) 728 (Ont. C.A.), in
determining that s. 7 contained a procedural and not a substantive rule. It was
simply a procedural bar to certain plaintiffs invoking otherwise subsisting
rights. As such, its repeal must be given retrospective effect "unless it
prejudices a substantial right of the defendant." The husband, he
continued at p. 670,
...had no right given by any rule of substantive law to
injure the plaintiff...All that happened [on the passing of the Act] was that a
bar to the injured person seeking redress was removed.
10. For
the husband it had been argued that The Family Law Reform Act, 1975
should be dealt with in a manner analogous to that traditionally accorded
limitations provisions. Limitations provisions, although in some sense
procedural, are normally not given retrospective effect. Galligan J. declined
to follow this reasoning, holding that the policy reasons underlying the
treatment of limitations provisions were absent in the present case. He stated
at pp. 670‑71:
It has long been recognized that limitations must be
placed upon the time within which plaintiffs can launch actions. It is not
difficult to understand why the courts have traditionally refused to construe
legislation in a way that would take away a person's right to be free of a
particular suit by retrospective interpretation.
It does not appear to me that the
same considerations ought to apply when a procedural bar to a particular person
or class of persons seeking redress for wrongs occasioned to them is removed by
statute.
11. Galligan
J. then considered the effect of The Family Law Reform Act, 1975 on s.
214. Section 214, as opposed to s. 7 of The Married Woman's Property Act,
was in his view a substantive provision. The presumption against
retrospectivity, then, should apply to it. However, he concluded that the
repeal of s. 214 followed as a matter of necessary implication from the removal
of spousal immunity. The change to The Insurance Act
...was a consequential amendment made necessary by the
removal of spousal immunity. I cannot accept that the Legislature would remove
that immunity without intending to remove the prohibition against indemnity in
actions that would be brought as a result of the removal of the immunity.
...
To permit a spouse to be sued in tort by his or her
spouse and to maintain an exemption of insurance against such liability would
appear to me to be an injustice that the Legislature cannot have intended.
12. Galligan
J. stated that he found it unnecessary to deal with whether s. 214 applied
retrospectively to provide indemnity for the father. Since the husband as
driver was an unnamed insured under the policy and s. 214 required the
insurance company to indemnify him for liability for the damages he had caused
his wife, the issue regarding indemnity for the father became moot.
13. In
a brief endorsement, the Court of Appeal upheld the judgment of Galligan J.
Citing Manning, supra, it added that the defence provided by s. 7
was in any case no longer available to James Angus since the parties had been
divorced.
Analysis
14. The
initial propositions recited by Galligan J. regarding retrospective effects are
unexceptionable. There is a presumption that statutes do not operate with
retrospective effect. "Procedural" provisions, however, are not
subject to the presumption. To the contrary, they are presumed to operate
retrospectively; see E. A. Driedger, Construction of Statutes (2nd ed.
1983), at pp. 202‑3; Howard Smith Paper Mills Ltd. v. The Queen,
[1957] S.C.R. 403.
15. The
distinction between substantive and procedural provisions, however, is far from
clear. Thus, in the present context, Jessup J.A. in Manning, supra,
determined that s. 7 was a procedural provision. This was done largely on the
basis of Lord Denning's judgment in Broom v. Morgan, [1953] 1 Q.B. 597
(C.A.) Broom concerned the vicarious liability of an employer for
injuries suffered by a woman due to the negligence of her husband when both
husband and wife were employees of the defendant. The English legislation in
question in Broom was essentially identical to that in issue here. Lord
Denning had this to say, at pp. 609‑10, about the husband's primary
liability:
It is plain, to my mind, that the husband owed a duty to
everyone lawfully in the house to use reasonable care, and that he was
negligent so far as all of them were concerned, including his wife. If the barman
fell down the hole and was injured, the husband would clearly be guilty of a
tort and be liable for the damage. So he is when his wife falls down the hole.
The only difference is that by statute she is not permitted to sue him for it.
His immunity does not rest on the theory that husband and wife are one. That
fiction has no longer any place in our law. His immunity nowadays rests simply
on the wording of section 12 of the Married Women's Property Act, 1882, which
is preserved in this respect by section 1 of the Act of 1935. That section
disables the wife from suing her husband for a tort in much the same way as the
Statute of Frauds prevents a party from suing on a contract which is not in
writing; but it does not alter the fact that the husband has been guilty of a
tort. His immunity is a mere rule of procedure and not a rule of substantive
law. It is an immunity from suit and not an immunity from duty or liability.
16. With
respect, the concluding distinction made by Lord Denning strikes me as
artificial. There seems to be little content to a "liability" that is
unenforceable. Lord Denning states that the husband has in fact committed a
tort, though by operation of the "procedural" provision he simply
cannot be held accountable for it. This position seems insupportable. In Maxwell
v. Callbeck, [1939] S.C.R. 440, the plaintiff, while driving a motorcycle,
was injured in a collision with the defendant's automobile in Alberta. The
accident occurred on October 30, 1936, and the plaintiff brought action in
negligence against the defendant on October 12, 1937. This Court agreed with
the trial judge that the plaintiff was the author of his own misfortune but it
further held that even if he were not solely at fault, his negligence had
contributed to the collision. At the time of the accident, the common law
prohibition against apportionment of liability among tortfeasors had not been
removed. However, in the interval between the accident and the time when the
action was brought, the province had enacted The Contributory Negligence Act,
S.A. 1937, c. 18, which provided for such apportionment, and the plaintiff
contended that he was entitled to rely on its provisions. The Court, however,
briefly dismissed the argument on the basis of the "well established"
rule of prospective application of statutes. If Lord Denning's argument were
accepted, a case like Maxwell would have to be decided otherwise, since
by contributing to the accident the contributory tortfeasor certainly committed
a wrong; at common law he was simply not liable for it.
17. This
example in my view exposes the poverty of the attempted distinction between a
liability and its enforcement. A "tort" is a legal construct and is
not to be confused with a "wrong" in the general sense. It only
exists where the law says it exists, i.e., where the law provides a remedy.
While an action may not entail legal liability and yet be "wrong" in
many senses, it is only wrong in the sense required by Lord Denning's argument
if it is actionable.
18. Lord
Denning determined that the husband's immunity from suit was "a mere rule
of procedure" in large part because the initial common law rule from which
the provision was descended had rested upon the now‑discredited fiction
that "husband and wife are one". In the absence of that fiction, the
immunity is apparently, in Lord Denning's view, denuded of substantive content.
What remains is purely procedural; Broom, at p. 609.
19. I
also find it difficult to follow this argument. Whether or not the provision is
based on the common law fiction is irrelevant. As Oliver J. put it in Midland
Bank Trust Co. v. Green (No. 3), [1979] 2 All E.R. 193 (Ch. D.), at p. 211:
Of course, the fact that the law has
evolved a rule, applying a particular fiction in given circumstances as a
matter of policy does not involve the conclusion that a court is at liberty to
alter the rule because it thinks that public policy has changed, although
policy may be a cogent factor in ascertaining what the law is where there is no
clear and certain guide in previous authority. What the court cannot do is to
legislate to alter a clear and established rule . . . .
A provision
is substantive or procedural for the purposes of retrospective application not
according to whether or not it is based upon a legal fiction, but according to
whether or not it affects substantive rights. P.‑A. Côté, in The
Interpretation of Legislation in Canada (1984), has this to say at
p. 137:
In dealing with questions of temporal
application of statutes, the term "procedural" has an important
connotation: to determine if the provision will be applied immediately [i.e. to
pending cases], . . . the question to be considered is not
simply whether the enactment is one affecting procedure but whether it affects
procedure only and does not affect substantial rights of the
parties." [Quoting DeRoussy v. Nesbitt (1920), 53 D.L.R. 514, 516.]
20. In
the present case, it is difficult to see how procedure is being affected at
all. The provision in question provides a complete defence to an action.
Whatever may be the reasons for this, and whether one agrees or disagrees with
them, the provision of a complete defence to an action, just as much as the
creation of a cause of action itself, is a substantive matter.
21. Even
if one assumes that the provision in question is procedural in some sense, the
judicially created presumptions regarding the retrospective effect of
procedural rules were not devised with this sort of distinction in mind.
Normally, rules of procedure do not affect the content or existence
of an action or defence (or right, obligation, or whatever else is the subject
of the legislation), but only the manner of its enforcement or use. P.
St. J. Langan, Maxwell on Statutory Interpretation (12th ed. 1969), at
p. 222, puts the matter this way:
The presumption against retrospective
construction has no application to enactments which affect only the procedure
and practice of the courts. No person has a vested right in any course of
procedure, but only the right of prosecution or defence in the manner
prescribed for the time being, by or for the court in which he sues, and if an
Act of Parliament alters that mode of procedure, he can only proceed according
to that altered mode.
Alteration
of a "mode" of procedure in the conduct of a defence is a very
different thing from the removal of the defence entirely. The latter is in
essence an interference with a vested right.
22. This
is the reason for the judicially‑created exception for limitations
statutes. Although in some sense "procedural", they will not be
presumed to have retrospective effect since they may deprive a plaintiff of a
right of action which he had at the time of the passage of the legislation; see
Upper Canada College v. Smith (1920), 61 S.C.R. 413; Merrill v.
Fisher (1975), 11 O.R. (2d) 551 (C.A.), at p. 552. In a decision more
closely related to the present case, this Court has recently held that the
extension or alteration of a period of limitation will not deprive a person of
the defence he had acquired under the limitation period in existence before the
change; see Martin v. Perrie, [1986] 1 S.C.R. 41. However much sympathy
one may have for Diane Angus, in my respectful view, the conclusion that s. 7
is of a procedural nature such as to entail a retrospective interpretation
cannot be accepted. The rule against retrospective application should certainly
have effect in a context such as the present one, where a party is deprived of
a defence to an action by the operation of the new statute; see Foy v. Foy
(1978), 20 O.R. (2d) 747 (C.A.), at pp. 747‑48 per Jessup J.A. in
obiter. This is the whole point of the presumption. The law is leery of
retrospective legislation to begin with; the legislature will not lightly be
presumed to have intended a provision to have retrospective effect when the
provision substantially affects the vested rights of a party.
23. Galligan
J. also maintained that James Angus had no "right to injure" his wife
and was, therefore, not being deprived of anything. The reality seems to me to
be quite otherwise. A retroactive application of s. 7 would clearly deprive him
of a complete defence to the action.
24. It
is not necessary here to untangle the complex distinctions between substantive
and procedural legislative provisions. The provision in this case is clearly
substantive. In any case, whether the provision is deemed to be substantive or
procedural, it is not one to which a presumption of retrospectivity can be
applied. This would amount to a serious deprivation of an acquired right of the
husband, and it should not lightly be assumed that this was the intention of
the legislature.
25. The
Court of Appeal, relying on its earlier decision in Manning, supra,
also held that the divorce of Diane and James Angus subsequent to the
commencement of the action put the parties outside the purview of s. 7. It
seems to me, however, that this conclusion is in the end based on the
characterization of the spousal immunity as procedural, which I have already
rejected. In the realm of civil liability, a "victim's rights are
crystallized at the moment of the wrongdoing", Côté, supra, at p.
103. No subsequent change of mere status can deprive a party of a substantive
right subsisting at that time. Lord Denning in Broom, at p. 610, agreed:
In so far as [Phillips v. Barnet] was based on
the fiction that husband and wife were one, the reasoning is no longer valid;
but I would not like to suggest that the case would be decided any differently
today. The immunity from suit conferred by section 12, once it has attached, is
not lost by divorce.
Phillips v.
Barnet, [1875‑76] 1 Q.B.D. 436, concerned precisely the same situation
as we are confronted with here, i.e., a divorced woman attempting to sue her
former husband for damages inflicted during the marriage. It is worthy of notice
that Broom, and several other cases relied upon by the appellants,
involved facts substantially different from those before us. They concerned the
vicarious liability of an employer when husband and wife were both employees
and the wife suffered injury as a result of the negligence of the husband. Thus
the effect of the husband's immunity was indirect, whereas in the present case
it is direct.
26. The
preceding discussion is sufficient to dispose of the case against the husband
and of that against the insurance company for any liability flowing through
him. Indeed, the insurance company would be absolved of the liability simply on
the basis of the terms of the insurance policy. However, the liability of the
father, Owen Hart, is in no way dependent on s. 7. As counsel for the appellant
noted, for years children have had the right to sue their parents for damages
resulting from the negligent operation of a motor vehicle. Section 214 of The
Insurance Act, however, operated as a bar to recovery against the father's
insurance company. This then, brings up the issue whether the repeal of s. 214
by s. 5 of The Family Law Reform Act, 1975, is to be construed as having
retrospective effect.
27. The
arguments made respecting s. 7 of The Married Woman's Property Act are
equally applicable here. But the argument against the retrospective repeal of
s. 214 is even stronger. To begin with, there can be no doubt that s. 214 is a
substantive provision to which the ordinary principle against retrospective
operation applies. Galligan J. agreed with this, but construed the repeal as
retrospective because of the relationship of s. 5 to s. 7. In view of my
conclusion on s. 7, this argument loses all its force.
28. This
case is a good illustration of the policy reasons why statutes should not be
given retrospective operation in the absence of an intention to do so that is
either expressed in, or is necessarily implied by the statute. Substantial rights
of insurance companies are affected by the decision of Galligan J. The
reasoning regarding limitations Acts applies a fortiori to the situation
of the insurance companies. Insurance companies calculate their premiums
according to known risk factors. When the rates for the contract in question
here were calculated, it was "known" that this particular risk‑‑a
suit in tort by Diane Angus against her husband‑‑was precluded by
s. 7. The insurance company relied upon that "knowledge" in setting
its rates. A retrospective change to that circumstance should not lightly be
implied. In Martin v. Perrie, supra, this Court held that the
change of a limitation period for medical malpractice actions (from one year
from the date of the Act to one year from the date of discovery of the damage)
could not be given retrospective effect since physicians could have relied on
the older provision to order their affairs (e.g., by destroying records) in
such a way that they would be prejudiced by the change. The analogy here, in
my view, is clear.
Disposition
29. For
these reasons, I would allow the appeal, set aside the order of the Ontario
Court of Appeal and dismiss the action as against Sun Alliance Insurance
Company. The action against James Angus is also dismissed. The action against
Owen Hart should be returned to the trial judge to be dealt with as required by
law. There should be no order as to costs.
Appeal
allowed.
Solicitors
for the appellant: Hendin, Hendin & Casey, Ottawa.
Solicitor
for the respondent Diane Hart Angus: David M. McFadyen, Willowdale.
Solicitors
for the respondents Owen Hart and James Angus: Bell, Baker, Ottawa.
Email this Content