IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20101019

Docket: S18019

Registry:
Chilliwack

Between:

Bernice Lynn
Patterson

Plaintiff

And

Jennifer Lynn
Williams and Kathryn Edna Blackburn

Defendants

And:

Lisa
Marie Parker

Third
Party

Before:
The Honourable Mr. Justice Sigurdson

Reasons for Judgment

[1]            
The third party applies under Rule 9-8(5) of the Supreme Court Civil
Rules, B.C. Reg. 168/2009, for an order that the defendant, Jennifer Lynn
Williams, pay the third party’s costs of defending the third party
proceedings.

[2]            
The plaintiff has filed a notice of discontinuance against the defendant
following a settlement between the plaintiff and the defendant Ms. Williams.

[3]            
Rule 9-8(5) states:

(5)  If a plaintiff
discontinues the whole or any part of an action in which a person has been
joined as a third party, the third party, if the discontinuance disposes of the
claim against the third party, is entitled to costs and may apply to the court
for a direction as to who should pay them.
[Emphasis added]

[4]            
Mr. Nossal, counsel for the third party, argues that the
discontinuance of the action disposes of the claim against the third party, but
acknowledges that if it does not then his application for costs must fail.

[5]            
The circumstances giving rise to this application were as follows.

[6]            
On December 20, 2006, the plaintiff and the three other parties were
walking their dogs when the plaintiff was knocked over by one or more of the
dogs and sustained injuries.  The plaintiff started two actions.  In the first
action, the subject action, the plaintiff named Ms. Williams and Ms. Blackburn
as defendants.  Ms. Williams commenced third party proceedings against Ms. Parker.

[7]            
In the second action, also commenced in the Chilliwack Registry, as Action
No. S19548, the plaintiff named Ms. Parker as the sole defendant.  Ms. Parker
then commenced third party proceedings against both Ms. Williams and Ms. Blackburn.

[8]            
In May 2010, the plaintiff settled her claims against Ms. Williams and
Ms. Blackburn and signed a release and settlement agreement (“the
Release”).  The Release provided that the plaintiff released all claims against
Ms. Williams and Ms. Blackburn and would discontinue this action. The
Release further provided that the plaintiff could continue the second action,
but would not seek from Ms. Parker any portion of the damages the
defendants might have been found liable to pay and, as such, the need for any
contribution or indemnity claims against the defendants by Ms. Parker
would be removed. Finally, the plaintiff agreed to indemnify the defendants
from any claims made against them by the plaintiff or any other party to the
first and second actions.

[9]            
On May 25, 2010, the plaintiff in this action filed a notice of discontinuance
against Ms. Williams and Ms. Blackburn.

[10]        
The third party, Ms. Parker, seeks costs from Ms. Williams of
the third party proceedings on the basis that the discontinuance by the
plaintiff disposes of part or all of the claim against the third party (Rule
9-8(5)).

[11]        
The third party says that the notice of discontinuance disposes of the third
party claim, as it was for contribution and indemnity only and did not include
an independent claim. This was so, in the third party’s submission, because the
specific wording of the third party notice made the third party claim
conditional both on the plaintiff not being contributorily negligent and on the
defendant being found liable. According to the third party, these conditions
cannot now be satisfied because of the discontinuance.  Mr. Nossal also argues that
there is no ongoing claim against the third party because the terms of the Release
are on so-called “B.C. Ferry Agreement terms” (British Columbia Ferry Corp.
et. al. v. T&N plc. et .al. (1993), 86 B.C.L.R. (2d) 353 (S.C.); (1995),
16 B.C.L.R. (3d) 115 (C.A.)) that prevent recovery from a third party.

[12]        
I think that this application for costs must fail.  While the Release may
limit the liability of the defendants and prevent successful third party
proceedings against them, the notice of discontinuance itself does not prevent
the defendants from continuing third party proceedings against Ms. Parker.

[13]        
I do not think it can be said that the filing of the notice of discontinuance
by the plaintiff disposes of the claim against the third party by the
defendants.

[14]        
The claim for contribution is a substantive right that continues to
exist notwithstanding a settlement: see A.R. (Al) Smith Ltd. v. Turner,
[1984] B.C.J. No. 3107, [1985] 2 W.W.R. 424 (B.C. Co. Ct.), and Canada v.
Foundation Co. of Canada, [1980] 1 S.C.R. 695.

[15]        
Moreover, I do not think that the precise terms of the third party
notice can be determinative of this application, as the defendants are at
liberty to apply to amend the terms of the third party notice.

[16]        
Even if the terms of the Release do prevent the defendant from continuing
third party proceedings against the third party, which I question, that is a
matter of the interpretation of the Release, not something that flows from the
filing by the plaintiff of the notice of discontinuance itself.

[17]        
Accordingly, the application by the third party for costs is dismissed,
with costs.

“J.S. Sigurdson J.”

The
Honourable Mr. Justice J.S. Sigurdson