IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20140124

Docket: S125455

Registry:
Vancouver

Admiralty
Action in Rem against
the Ship “Queen of Nanaimo”
and in Personam

Between:

Zdenka Sperling

Plaintiff

And

The Owners and All
Others Interested in the Ship “Queen of Nanaimo”,

The “Queen of
Nanaimo”, British Columbia Ferry Services Inc.,

John
Doe 1, Prime Mover Controls Inc., ABC Company and John Doe 2

Defendants

Before:
The Honourable Mr. Justice Kent

Oral Reasons for Judgment

Introduction

[1]            
The plaintiff applies under the R. 6-1 and 6-2(7)(c) to correct a
pleading “misnomer” by amendment or alternatively to add parties as defendants
in the lawsuit. The proposed defendants oppose the application primarily on the
ground that the plaintiff’s claim is barred by the federal legislation
governing maritime negligence law, namely the Marine Liability Act, S.C.
2001, c. 6 (the “MLA”) and that this Court has no jurisdiction to “extend”
the limitation period beyond that prescribed by the MLA.

[2]            
For the reasons that follow I have decided to allow the application, at
least in part. Certain of the proposed additional defendants will added to the
proceedings, albeit on terms respecting the form of the resulting amendment to
the notice of civil claim (“NOCC”).

Position of the Parties

[3]            
The applicant plaintiff marshalls an impressive array of alternative
arguments to accomplish its purpose including submissions that:

1.     The two
year limitation period incorporated into the MLA by way of the “Athens
Convention” does not apply to the simple “products liability” claim made
against the proposed additional defendants;

2.     The three
year “ultimate” limitation period in s. 140 of MLA expires three years
“after the day on which the cause of action arises”, a concept which engages
the common-law principle of discoverability to the benefit of the plaintiff on
the facts of this case;

3.     In any
event, the former BC Limitation Act, R.S.B.C. 1996, c. 266, (along with
its own concepts of discoverability and postponement) applies to the claim
because (a) the products liability claim is in no way related to shipping or
maritime law and (b) in the alternative, its application is constitutionally
permissible by virtue of Marine Services International Ltd. v. Ryan Estate,
2013 SCC 44, a recent decision of the Supreme Court of Canada [Marine
Services];

4.     Even
assuming the MLA governs the claim and imposes a two or three year
limitation period without the benefit of extensions, R. 6-2(7)(c) still permits
the addition of parties if it is “just and convenient” to do so, which is
claimed to be the case here; and

5.     Lastly,
the proposed defendants can simply be substituted for the current named
defendant ABC Company by way of amendment to correct a “misnomer” in respect of
which no limitation objections apply.

[4]            
The respondent proposed new defendants submit,

1.     the only
applicable limitation period is that under the MLA, a limitation period
which has expired and which this Court has no jurisdiction to extend, whether
under the rubric of “just and convenient” or otherwise; and

2.     having
regard to the contents of the plaintiff’s notice of civil claim, this is not an
application to correct a misnomer, but rather is clearly and obviously an
application to add parties (after the expiry of the relevant limitation
period), an application which cannot succeed in the circumstances.

Background

[5]            
By her notice of civil claim filed August 2, 2012, the plaintiff seeks
damages for personal injuries sustained when the ferry “Queen of Nanaimo” hit
the dock at the Village Bay Terminal on Mayne Island on August 3, 2010. The
plaintiff was a passenger on the ferry and she alleges that the “hard docking”
caused her to be thrown from her chair and to strike her head on a nearby pole.

[6]            
The notice of civil claim, which is entitled at least in part as an “admiralty
action in rem against the ship ‘Queen of Nanaimo’ and in personam”,
sues the ship itself, its owners, BC Ferry Services Inc., Prime Mover Controls
Inc. and three loosely identified defendants called John Doe 1, ABC Company and
John Doe 2 respectively.

[7]            
In para. 3 of part 1 statement of facts of the NOCC John Doe 1 is
identified as the master of the ferry (name unknown).

[8]            
With respect to ABC Company and John Doe 2 the NOCC further states in
part 1: statement of facts:

8.     The
Defendant ABC Company (“ABC”), is a commercial entity, whose identity and
location are currently unknown to the Plaintiff.

9.     At
material times ABC was an independent contractor of BCF. Alternatively ABC was
a sub-contractor of PMC, and/or an agent of PMC or BCF.

10.  The Defendant John Doe 2,
whose identity and location are currently unknown to the Plaintiff, was at all
material times an independent contractor of BCF, PMC or ABC. Alternatively John
Doe was a sub-contractor of PMC or ABC.

11.   In the further alternative
John Doe 2 was at all material times an employee and/or agent of BCF, PMC or
ABC, and was at all material times acting in the course of his or her
employment.

12.  At all material times BCF,
John Doe 1, PMC, and/or ABC Company, and each of them, their employees and/or
agents, were responsible, wholly or in part, for the design, construction, installation,
maintenance, service, inspection, refit and/or repairs of the operating
systems, equipment and/or machinery of the Ferry, including but not limited to
those relating to its propulsion, breaking and/or steering systems.

13. 
At all material times John Doe 2, his or her employees and/or agents,
were responsible, wholly or in part, for the design, construction,
installation, maintenance, service, inspection, refit and/or repairs of the
operating systems, equipment and/or machinery of the Ferry, including but not
limited to those relating to its propulsion, breaking and/or steering systems.

[9]            
Paragraph 18 of part 1: statement of facts of the NOCC states:

The incident was caused or contributed by acts or omissions
or the Defendants, including the following:

                      
(a)         
the failure of the mater and/or crew of the Ferry to safely and properly
decrease speed, steer or otherwise control the Ferry for docking;

                      
(b)         
the unseaworthiness of the Ferry, including

(i)     mechanical
breakdown of the propulsion, breaking and/or steering systems;

(ii)    improper design,
construction, installation, maintenance, service inspection, refit and/or
repairs of components of the propulsion, breaking and/or steering systems,
including the tapered dowels for the port side oil distribution box;

(iii)  inadequate or improperly
used ship communication systems and equipment; and

                      
(c)         
such further and other causes or contributing causes as may become
known.

[10]        
In part 3: legal basis of the NOCC the following allegations of
negligence appear:

8.     The
particulars of the negligence of PMC, ABC Company and/or John Doe 2 include but
are not limited to the following:

                                
(a)         
failing to equip, maintain and repair the Ferry properly and in a
seaworthy condition;

                                
(b)         
failing to properly design, construct, install, maintain, service,
inspect, refit and/or repair the operating systems, equipment and/or machinery
of the Ferry, including but not limited to those relating to its propulsion,
breaking and/or steering systems, and to ensure that they were adequate for the
safe operation of the Ferry;

                                
(c)         
failing to implement reasonable systems of maintenance and inspection on
board the Ferry to diagnose and adequately address potential failures of
machinery, equipment and/or other operating systems;

                                
(d)         
permitting the wrong tapered dowels, without securing nuts, to be
installed in port side oil distribution box;

                                
(e)         
failing to notice, replace, repair, add securing nuts to, or otherwise
prevent from falling the wrongly installed tapered dowels in the port side oil
distribution box prior to the incident and failing to remedy the dangerous
condition caused thereby;

                                  
(f)         
failing to design, construct, install and/or recommend a secondary
braking system on the Ferry when it knew or ought to have known that the
propulsion or primary braking system could fail and cause injury, damage,
and/or loss;

                                
(g)         
failing to adequately train, instruct and supervise employees servicing
or working on the Ferry;

                                
(h)         
failing to take reasonable measures to render the Ferry safe for its
intended purposes;

                                  
(i)         
causing or permitting the Ferry to be, become, or to remain in a dangerous
and/or defective condition at the time of the Voyage; and

                                  
(j)         
such further and other particulars of negligence which may become known
to the Plaintiff.

[11]        
BC Ferries convened a panel to conduct an internal investigation into
the hard docking incident. The report was critical of various operational
practices but particularly noted a “mechanical disconnect” which occurred when
two tapered dowels loosened and fell out of the oil distribution box forming
part of the ferry’s propulsion equipment.

[12]        
The ferry, which was built in the 1950s, has a diesel engine driving
each of the two propeller shafts on the vessel. Each shaft line has an oil
distribution box as part of the controllable pitch propeller system. The two
tapered dowels secure the auxiliary servo piston and the lever on top of the
control post which moves the valve rod for the propeller hub. Their absence
(falling out) allowed the valve rod and the piston in the port propeller hub to
drift to a full ahead pitch position, a condition that would have been unknown
to the bridge crew. The report concluded the dowels had not been secured
properly and, indeed, that “at some time in the past, the wrong tapered dowels
were installed in the port OD box”.

[13]        
This investigation report was provided to the solicitor for the
plaintiff on May 20, 2011. Over a year later, on July 17, 2012, plaintiff’s
counsel emailed the BC Ferries risk manager posing various specific inquiries
regarding the persons involved in the installation and inspection of the
tapered dowels and the OD boxes, and the identity of any non-BC Ferries
personnel “responsible for the inspection, maintenance, and/or repairs” of same
before the accident.

[14]        
As indicated, the lawsuit was issued August 2, 2012 which named among
others, ABC Company and the two John Does as defendants. Plaintiff’s counsel
says in his affidavit “I was not aware of the possible involvement of the
proposed defendants in the installation, maintenance, inspection or repair of
the ferry’s port OD box and dowels. However, I did understand that the
plaintiff might need to substitute or add further parties to her action going
forward should sufficient evidence surface to warrant that”.

[15]        
In January 2013 plaintiff’s counsel received a binder of BC Ferries
documents. In the ensuing months the documents were reviewed by counsel and
further queries went back and forth between counsel and the BC Ferries risk
director respecting the identities of the persons/entities involved in the
maintenance and repair of the Queen of Nanaimo’s controllable pitch propeller
system (including the oil distribution box). The invoices supplied and some of
the answers provided clearly identified the involvement of two corporations,
namely, Kamewa Canada Inc. and Rolls-Royce Canada Limited as well as an
individual, Mr. Ken Burrows who may have been employed by one or both of them.

[16]        
Corporate searches confirm Kamewa Canda Inc. amalgamated with Ulstein
Maritime Ltd. in September 2000 and that the amalgamated company carried on
under the latter name. Kamewa Canada Inc. no longer exists as a separate legal
entity.

[17]        
There is nothing in the affidavit or application materials which
establish any meaningful involvement of the other two proposed added
defendants, Rolls-Royce PLC and Vickers PLC. In their response, the respondents
say Vinters Limited is a U.K. company formerly known as Vickers PLC. They also
say that each of Vinters Limited and Roll-Royce PLC are separate legal entities
from Rolls-Royce Canada Limited and Ulstein Maritime Ltd., and that Ken Burrows
was never an employee of either company.

[18]        
The present application was filed on August 2, 2013, three years less a
day from the date of the accident.

The Law Respecting Misnomers and Addition of Parties

[19]        
There is an important distinction between amendment applications to
correct a “misnomer” in a pleading and applications to add a party to the
lawsuit. The distinction can be of great significance where a limitation
defence may have accrued in favour of the person sought to be named or added.

[20]        
Where an amendment merely seeks to correct a misnomer in a lawsuit
otherwise brought in time and in respect of which no limitation defence had accrued,
the correction of the misnomer circumvents the application of any limitation
defence that might otherwise apply. On the other hand, where the application is
in truth an application to add a party in whose favour a limitation defence may
have accrued, different considerations apply and the limitation defence will be
one of the factors taken into account in the court’s determination whether it
is “just and convenient” to add the new party in all the circumstances of the
case.

Misnomer

[21]        
The naming of a “John Doe” defendant, obviously a fictitious name, is a
common mechanism for issuing suit (usually before the imminent expiry of a
limitation period) against an identifiable and identified person whose proper
name is not actually known: Jackson v. Bubela et al. (1972), 28 D.L.R.
(3d) 500 (B.C.C.A) [Jackson].

[22]        
In Jackson a writ was issued in a motor vehicle negligence action
just before the expiry of the applicable limitation period against the owner
and driver of the motor vehicle. Because inquiries had failed to disclose the
identity of the driver, he was named in the pleading as “John Doe”. Once the
true identity of the driver was ascertained, an application was made to amend
the style of cause to change the name. The Court of Appeal held that the
application should be granted and explained:

5.     […] The
words "John Doe" to my mind are not restricted in connotation to a
"fictitious" person or one not in existence. Traditionally the words
were used in that limited sense in early ejectment suits, but for generations
they have come to be accepted, used and understood, both in legal and common
parlance as indicating a real person existing and identifiable but whose name
is not known or available to the person referring to him. That is the situation
here. The appellant was not purporting to sue a fiction to maintain or acquire
some property right as was done in ancient times. On the contrary, she was
suing a living man whom she alleged was at a particular defined time and place
operating a described motor vehicle in such a negligent manner as to cause her
injuries then and there. Her litigating finger v/as pointed at that driver and
no one else, but she did not know his name. For the purposes of suit (and it
was necessary to act quickly because of the imminent expiry of the limitation
period) she gave that identifiable and identified man a name, using one that
would clearly connotate to all that it did not purport to be his real name.
And, further, in the endorsement it was clearly stated that the real name of
the defendant driver was not "John Doe" but was unknown except to the
other defendant, the female respondent.

6.     Under
these circumstances. I can see no elements of an addition of. or substitution
for, a defendant. No new entity or person was involved. It was merely an
application to change the name of a party from a patently incorrect one to his
proper one.

7.     In my
opinion, the proper test to be applied in such a situation has been outlined by
Devlin, L.J., in Davies v. Elsby Brothers, Ltd., supra, at p.
676:

The argument of counsel for the
plaintiff, on the other hand, is that this is a misnomer because there can be
no doubt that the person whom the plaintiff intended to sue was his employer,
and his employer at the time of the accident was the company. I think that that
is going to the opposite extreme on the other side and I could not assent to
that. It is a general principle of English law, not merely applicable to cases
of misnomer, that the intention which the framer of the document has in mind
when he brings it into existence is not material. In that we differ from many
continental systems. In English law as a general principle the question is not
what the writer of the document intended or meant, but what a reasonable man
reading the document would understand it to mean; and that is the test which
ought to be applied as a general rule in cases of misnomer-which may embrace a
number of other situations apart from misnomer a writ, for example mistake as
to identity in the making of a contract. The test must be: How would a
reasonable person receiving the document take it? If in all the circumstances
of the case and looking at the document as a whole, he would say to himself:
"Of course it must mean me. but they have got my name wrong", then
there is a case of mere misnomer. If. on the other hand, he would sav: "I
cannot tell from the document itself whether they mean me or not and I shall
have to make inquiries", then it seems to me that one is getting beyond
the realm of misnomer. One of the factors which must operate on the mind of the
recipient of a document, and which operates in this case, is whether there is
or is not another entity to whom the description on the writ might refer.

8.     Anybody in
the world (except the driver of the offending vehicle^–) reading the
writ would immediately say "’John Doe’ is not I". But that
driver reading the writ would immediately and without hesitation say "I am
the ‘John Doe’ sued. I was driving the vehicle at the place and time as
alleged, but that, of course, is not my real name".

9.    
Although "misnomer" usually has reference to a wrong naming by
mistake, whereas the wrong naming here was deliberate, I think the tests above
set out with respect to misnomer generically have full application in this
case. I can see no compelling reason why an advertent misnaming of a clearly
identified person should be any less subject to the test relative to misnomer
than an inadvertent one. This is particularly so when the conduct of that
person has caused or contributed to the situation. I therefore conclude that
the application was one of amendment to correct a misnomer and not for the
addition or substitution of a new or different party.

[23]        
In Broom v. The Royal Centre at al, 2005 BCSC 1630 [Broom],
the court further explained:

[8]        In Oldridge the important
distinction between misnomer and an application to substitute a correct
defendant is discussed at p.340. It is noted that the distinction is often
vital because a limitation period may have accrued in favour of a defendant
sought to be added, which would not apply in the case of misnomer, where a
defendant has been mis-described. An amendment to the style of cause to correct
a misnomer of one of the parties will be allowed after the expiration of the
limitation period. The correction of the misnomer does not prejudice the other
party because he was an identifiable party in the pleadings at the time that
the action was commenced. The amendment simply corrects the misnomer by setting
out his actual name.

[37]      It seems to me, on the
basis of Jackson, that in the case of an advertent misnaming of a
party as John Doe, an amendment substituting the correct name should be almost
automatic, provided, of course, that John Doe is sufficiently described in the
pleading as an identifiable person or corporation, although not by name; for
example, the driver of a motor vehicle involved in a particular accident, or a
corporation responsible for the cleaning and maintaining of particular premises
at the time that a person was injured allegedly as a result of the condition of
those premises; provided also that the other party is not substantially
prejudiced or injured, a situation which generally speaking is difficult to
envisage. This Court has always considered misnomer to be an irregularity only,
not a nullity, and has always allowed amendments which could be made without
injustice to the other side. See for example B.C. Furniture Company v.
Tugwell (1900), 7 B.C. Law Reports 361 (C.A.).

[24]        
In the present case the parties do not really dispute the law set out above.
Rather, it is in its application that differences arise. In particular, the
contest is whether “ABC Company” is sufficiently described in the pleading as
an identifiable and identified person, whether by role, responsibility or
involvement in the particularized circumstances, such that on a reasonable and
objective reading of the pleading the person in question would say “they do not
have my name but they obviously mean me”.

[25]        
In Chapman v. Canada (Minister of Indian and Northern Affairs),
2003 BCCA 665, it was held that a broad definition of multiple “Doe” defendants
(any band member over a length of period of time who had anything to do with
the underlying claims regarding lease hold lands) was not a case of a “true”
misnomer:

[53] … It appears to me that the problem identified by the
chambers judge is an over-broad use of the "Doe" device. The
statement of claim contains no allegation which would permit an individual to
know that the claim was against him or her. Other than a broad description of
the class of persons to which the "Doe’s" belong, no identifying
characteristics of the individuals is pleaded and there is no allegation of
time, place, circumstance, or event which could identify the conduct that is
said to have wronged the leaseholders.

[55] Looking at the picture from
one direction, one sees insufficient particularity to point the litigating
finger at any individual. Looking from the other, one sees that a reasonable
claim against an individual is not pleaded. They add up to the same thing.

[26]        
In the present case, the plaintiff’s pleading lumps defendants together
and makes blanket allegations against all of them without meaningful
distinction. Part 1, para. 8 asserts ABC Company is a commercial entity,
yet this application is to correct such “misnomer” by substituting four
corporations. Part 1, para. 12 of the NOCC broadly alleges that one or more of
four entities “and their employees and/or agents” were,

…responsible, wholly or in part,
for the design, construction, installation, maintenance, service, inspection,
refit and/or repairs of the operating systems, equipment and/or machinery of
the Ferry, including but not limited to those relating to its propulsion, braking
and/or steering systems.

This alleges activities which are so broad that it could
apply to a great many people.

[27]        
Part 1, para. 18 of the NOCC alleges that the incident was caused or
contributed by “acts or omissions of the Defendants” without distinguishing
between the defendants in question. The particulars of negligence asserted in
part 3, para. 8 of the NOCC are again aggregated as against one or more of
“PMC, ABC Company and/or John Doe 2”. The allegations are again extremely broad
i.e. “failing to properly design, construct, install, maintain, service,
inspect, refit and/or repair the operating systems, equipment and/or machinery
of the Ferry”.

[28]        
The plaintiff hopefully points to the allegations specifying wrong doing
in respect of the tapered dowels (e.g. part 3, para. 8 (d)(e) of the NOCC), but
again these do not distinguish between the three defendants referred to in that
paragraph and, indeed, the identical allegation is made against BC Ferries and
the master of the ferry named as John Doe 1.

[29]        
All in all, there is insufficient particularity to “point the litigating
finger” at any distinct person and unlike the circumstances describes in the Jackson
and Broom cases, this is clearly not a case of “true” misnomer but
is in truth an application to add new parties.

Addition of Parties

[30]        
The rule applicable to adding parties to an action is R. 6-2(7)(c) which
provides as follows:

Adding, removing or
substituting parties by order

(7) At any stage of a proceeding, the court, on application
by any person, may, subject to subrules (9) and (10),

(c) order that a person be added as
a party if there may exist, between the person and any party to the proceeding,
a question or issue relating to or connected with

(i) any relief claimed in the
proceeding, or

(ii) the subject matter of the
proceeding

that, in the opinion of the court, it would be just and
convenient to determine as between the person and that party.

[31]        
In this case it appears that the accident was caused or contributed to
by the two tapered dowels falling out of the oil distribution box forming part
of the ferry’s propulsion system and it appears on the evidence that the
servicing of that equipment was carried out over the years by the proposed
defendants, Kamewa Canada Inc. (now, following amalgamation, Ulstein Maritime
Ltd.) and Rolls-Royce Canada Limited. It is therefore apparent that there indeed
may exist between the plaintiff and those two entities a question or issue
relating to or connected with both the subject matter of the proceeding and the
relief claimed in that proceeding as required by R. 6-2(7)(c)(i) and (ii). The
question, then, becomes whether it would be “just and convenient” to have those
issues determined by adding the proposed defendants as parties.

[32]        
Fortunately, the general principles governing applications to add new
defendants to an action pursuant to R. 6-2(7)(c) have been very usefully
summarized by the Court of Appeal in The Owners, Strata Plan No. VIS3578 v.
John A. Neilson Architects Inc., 2010 BCCA 329 [Neilson Architects]
as follows:

1. The general principles

[43] The respondents maintain the six-year limitation period
that governs the owners’ claim against them has expired. The owners disagree.
Consideration of whether new defendants may be added to an action in that
situation begins with s. 4(1)(d) of the Limitation Act, R.S.B.C. 1996,
c. 266, which states:

4(1) If an action to which this or
any other Act applies has been commenced, the lapse of time limited for
bringing an action is no bar to

…

(d) adding or substituting a new
party as plaintiff or defendant,

under any applicable law, with respect to any claims relating
to or connected with the subject matter of the original action.

[44] Rule 15, which governs the addition of parties, is an
applicable law. The relevant portion reads:

15(5) (a) At any stage of a proceeding,
the court on application by any person may

…

(iii) order that a person be added
as a party where there may exist, between the person and any party to the
proceeding, a question or issue relating to or connected

(A) with any relief claimed in the
proceeding, or

(B) with the subject matter of the
proceeding,

which in the opinion of the court
it would be just and convenient to determine as between the person and that
party.

[45] Subrule 15(5)(a)(iii) thus establishes two requirements
that an applicant must prove to succeed in joining a new defendant. First, it
must show that there is a question or issue between the plaintiff and the
proposed defendant that relates to the relief, remedy, or subject matter of the
proceeding. The threshold is low. It has been expressed as establishing simply
that there is a real issue between them that is not frivolous, or that the
plaintiff has a possible cause of action against the proposed party. This
requirement may be met solely on the basis of proposed amendments to the
statement of claim, or the parties may provide affidavit evidence addressing
it. If evidence is provided, the court is not to weigh it and assess whether
the plaintiff could prove the allegations. It is limited to examining the
evidence only to the extent necessary to determine if the required issue
between the parties exists: Strata Plan LMS 1816 v. Acastina Investments
Ltd., 2004 BCCA 578, 33 B.C.L.R. (4th) 69; MacMillan Bloedel Ltd. v.
Binstead et al. (1981), 58 B.C.L.R. 173 (C.A.).

[46] If this first requirement is met, the court must next
determine whether it would be just and convenient to decide the issue between
the parties in this proceeding. This is a discretionary decision, but that
discretion is fettered to the extent that it must be exercised judicially, and
in accord with the evidence adduced and the guidelines established in the
authorities: Letvad v. Fenwick, 2000 BCCA 630, 82 B.C.L.R. (3d) 296. At
para. 29 of Letvad, Esson J.A., writing for the Court, adopted
the list of factors to be considered from Teal Cedar Products (1977) Ltd. v.
Dale Intermediaries Ltd. (1996), 71 B.C.A.C. 161, 19 B.C.L.R. (3d)
282, a decision that dealt with adding further claims under R. 24. These
include the extent of the delay, the reasons and any explanation for the delay,
any prejudice arising from the delay, and the degree of connection between the
existing action and the new parties and claims contemplated. The overriding
question is what is just and convenient in the circumstances of the particular
case.

[47] The existence of a limitation defence is a relevant, but
not determinative, factor in deciding whether to permit joinder, since the
effect of s. 4(1)(d) of the Limitation Act is to extinguish such a
defence if the proposed defendant is added. In Brito (Guardian ad litem of)
v. Wooley (1997), 15 C.P.C. (4th) 255, [1997] B.C.J. No. 2487, Joyce J. set
out a three step approach to considering a possible limitation defence, which
was adopted by this Court in Strata Plan LMS 1725 v. Star Masonry Ltd., 2007
BCCA 611, 73 B.C.L.R. (4th) 154 at para. 12. I summarize it as follows:

1. If it is clear there is no
accrued limitation defence, the only question is whether it will be more
convenient to have one or two actions since the plaintiff will be able to
commence a new action against the proposed defendant if it is unsuccessful in
the joinder application.

2. If it is clear there is an
accrued limitation defence, the question is whether it will nevertheless be
just and convenient to add the party, notwithstanding it will lose that
defence. The answer to that question will emerge from consideration of the
factors set out in Letvad.

3. If the parties disagree as to
whether there is an accrued limitation defence, and a court cannot determine
this issue on the joinder application, the court should proceed by assuming
that there is a limitation defence, and consider whether it is just and
convenient to add the party, even though the result will be the elimination of
that defence. If that question is answered affirmatively, an order for joinder
should be made, and it becomes unnecessary to deal with the limitation issue
since it will be extinguished by s. 4(1)(d) of the Limitation Act.

[48] There is also a fourth
option, an alternative to the third step, set out by Lambert J.A. in Lui v.
West Granville Manor Ltd., [1987] W.W.R. 49, 11 B.C.L.R. (2d) 273 at 303
(C.A.) [Lui No. 2]. He suggested that when the limitation issue could
not be determined on the joinder application, and the applicant had not
established that considerations of justice and convenience justified extinction
of the limitation defence under s. 4(1) of the Limitation Act, judicial
discretion could be exercised to permit joinder on terms that the limitation
defence would be preserved and determined at trial. That approach was
considered and adopted in Strata Plan No. VR 2000 v. Shaw, [1998] B.C.J.
No. 1086 (S.C.) [Shaw] and Stone Venepal (Celgar) Pulp Inc. v.
IMO Industries (Canada) Inc., 2008 BCCA 317, 83 B.C.L.R. (4th) 138.

[33]        
As indicated above, the existence of a limitation defence is a relevant,
but not necessarily determinative, factor in deciding whether to add a new
party to the action. In this case the parties strenuously disagree whether a
limitation defence has actually accrued and whether principles of
constitutional law respecting paramountcy of federal legislation or interjurisdictional
immunity render the provincial limitation legislation inapplicable.

[34]        
With respect to the limitation defence issues, a preliminary point
arises: the respondents argue that, if limitation defences under the MLA
govern and have accrued to the benefit of the respondents, then this Court has
no residual discretion to add the respondents as defendants whether under the
rubric of “just and convenient” or otherwise. They say, in effect, if the MLA
does apply as a complete defence to the plaintiff’s claim, then the plaintiff’s
application must be dismissed.

[35]        
I do not agree. It is true that s. 4(1)(d) of the “old” Limitation
Act, R.S.B.C. 1996, c. 266 expressly provided that the accrual of a
limitation defence was no bar to adding a new party as a defendant, but that
section was not the sole factor animating the judicial exercise of discretion
in determining what might be “just and convenient” in the particular
circumstances. To be clear, in my opinion, even if a limitation defence under
the MLA has accrued to the benefit of the proposed new defendants, the
court still has a discretion to add those persons as new defendants in the
litigation assuming, of course, it is just and convenient to do so.

The Limitation Issue

[36]        
Maritime law falls within the federal governments exclusive jurisdiction
over navigation and shipping under s. 91(10) of Constitution Act, 1867.
Limitation periods applicable to various marine liability claims are provided
for in the MLA. Of particular application to the present case are sections
37(1) and 140 of that Act which provide as follows:

Force of law

37. (1) Articles 1 to 22 of the Convention have the force of law in
Canada.

Proceedings under maritime law

140. Except as otherwise provided in this Act or in any other Act
of Parliament, no proceedings under Canadian maritime law in relation to any
matter coming within the class of navigation and shipping may be commenced
later than three years after the day on which the cause of action arises.

[37]        
The Convention referred to in s. 37(1) above is the Athens Convention
relating to the Carriage of Passengers and their Luggage by Sea, 1974.
Section 37(2) of the MLA extends the Convention to apply not only to
international carriage, but also to domestic carriage of passengers by water,
whether under a contract of carriage or not.

[38]        
Article 3 of the Convention creates a right of action by a passenger
against a carrier for personal injury occurring in the course of the carriage
due to the fault or neglect of the carrier. Article 6 provides for contributory
fault on part of the passenger to be taken into account. Articles 7 and 8
impose limits of liability on the part of the carrier for personal injury or
damage to luggage respectively. Article 14 expressly bars actions against a
carrier for damages for the personal injury of the passenger “otherwise than in
accordance with this Convention”.

[39]        
Article 16 of the Convention addresses limitation periods as follows:

ARTICLE
16

TIME-BAR
FOR ACTIONS

1.     Any action
for damages arising out of the death of or personal injury to a passenger or of
the loss of or damage to luggage shall be time-barred after a period of two
years.

2.     The
limitation period shall be calculate as follows:

                                          
(a)         
in the case of personal injury, from the date of disembarkation of the
passenger;

3.     The law of
the court seized of the case shall govern the grounds of suspension and
interruption of limitation periods, but in no case shall an action under this
Convention be brought after the expiration of a period of three years from the
date of disembarkation of the passenger or from the date when disembarkation
should have taken place, whichever is later.

4.    
Notwithstanding paragraphs 1, 2, and 3 of this Article, the period of
limitation may be extended by a declaration of the carrier or by agreement of
the parties after the cause of action has arisen. The declaration or agreement
shall be in writing.

[40]        
The first question that arises is whether the two year limitation period
pursuant to Article 16 of the Convention and which is in force by virtue of s.
37(1) of the MLA applies to the plaintiff’s proposed claim against the
new defendants. While many, indeed most, of the articles within the Convention
expressly refer to “the carrier” it is noteworthy that Article 16 contains no
such limitation. It simply refers to “any action for damages arising
out of personal injury to a passenger”. The words “any” and “arising out
of” have broad application and, on one reading, could capture the proposed
claim against the proposed new defendants.

[41]        
Suppose one passenger injures another by accidentally spilling hot
coffee or accidentally dropping luggage. Or suppose two passengers get into a
fight and one wishes to sue the other for injuries sustained. Are these claims,
even though they have nothing whatever to do with conduct, fault or neglect on
the part of the carrier or its employees/agents, governed by the two year
limitation period imposed by Article 16 of the Convention?

[42]        
One would have thought that these types of incidents would have occurred
many times, particularly in British Columbia where ferry traffic is
commonplace. Rather remarkably, however, I am advised that there is no case law
on this point in Canada. In fact, the only decision counsel could find was a
Scottish case, Cairns v. Northern Lighthouse Board, [2013] CSOH 22. In
that case the plaintiff was employed by the Northern Lighthouse Board and part
of her job involved visiting lighthouses to inventory assets. She was
travelling by boat to a lighthouse on the Isle of May when she suffered an
injury to her lower back. She sued both her employer and the boat owner. The
court held, among other things, “the [Athens] Convention has no application to
the [employer], who are not a carrier but are liable to the [plaintiffs] as her
employer … consequently the claim against the [employer] is not timed-barred,
and the limitation on liability in the Convention does not apply”.

[43]        
This is not weighty authority in Canada but it does express one judicial
view that the Convention, and Article 16 respecting limitation periods for
personal injury actions, applies only to a “carrier” and its “servants or
agents acting within the scope of their employment” (Article 3).

[44]        
In my opinion, the correct interpretation of Article 16 of the
Convention is indeed to limit its application to carriers. It is apparent from
reading the entire Convention that its whole purpose is to address liability of
carriers and it only makes sense for the limitation period provided in Article
16 to be similarly restricted.

[45]        
But that does not end the matter; as indicated, s. 140 of the MLA provides,
“… no proceedings under Canadian maritime law in relation to any matter coming
within the class of navigation and shipping may be commenced later than three
years after the day on which the cause of action arises”.

[46]        
Two questions arise here:

1.     is the
claim against the proposed new defendants a “proceeding under Canadian maritime
law in relation to a matter coming within the class of navigation and shipping”
and, if so,

2.     on what
day did the plaintiff’s cause of action against the proposed new defendants
arise?

[47]        
The plaintiff submits that the negligent acts alleged against the
proposed defendants, “… have nothing to with act of navigating. The negligent
acts consist instead of negligent repair and maintenance of a piece of
machinery that happens to form part of a ship. At its heart, this is
essentially an ordinary claim for negligent services and for products liability”.
The respondents, on the other hand, say that the subject matter of the claim
(personal injury suffered by a passenger while a vessel was attempting to dock)
“is squarely in the domain of federal maritime negligence law” and hence
captured by the MLA.

[48]        
It is difficult to draw the line between concepts of navigation and
shipping on the one hand and causes of action related to events on a vessel
that have nothing to do with navigation and shipping (eg. the scenarios in
para. 41 above). In this particular case, however, it is not necessary to
decide that point because, in my opinion, the second question referred to above
(“discoverability” of the cause of action) is to be resolved in favour of the
plaintiff.

[49]        
The ferry accident occurred August 3, 2010 and the plaintiff’s physical
injuries were sustained at that time. The identity of the owner and operator of
the ferry was immediately ascertainable and so the cause of action against that
entity immediately arose, or, at least, was immediately “perfected”.

[50]        
In due course on May 20, 2011 the plaintiff (through her counsel)
received the investigation report dated September 29, 2010 which identified the
tapered dowels as the cause of the propeller pitch problem. The lawsuit was
issued August 2, 2012, on the eve of any two year limitation expiry, and named
the fictitious ABC Company and two John Does as defendants. In January 2013 the
plaintiff (again through her counsel) was provided with a binder of BC Ferries
documents that identified the involvement of Kamewa Canada Inc. and Rolls-Royce
Canada Limited in the maintenance and repair of the ferry’s pitch propeller
system (including the oil distribution box).

[51]        
The MLA itself does not expressly provide for postponement or
extension of the ultimate three year limitation set forth in s. 140 of that Act.
However, the limitation period starts on the day the cause of action arose and
this, in turn, permits the application of the the common law “discoverability
principle” articulated in Peixeiro v. Haberman, [1997] 3 S.C.R. 549 (“Peixeiro”).

[52]        
The question in Peixeiro was “whether the discoverability
principle applies to postpone the running of time until the material facts
underlying the cause of action, including extent of the injury, are known”. In that
case the plaintiff was initially diagnosed as sustaining soft tissue injury in
a motor vehicle accident and it was not until almost three years later that a
CT scan revealed injury to the disk in the plaintiff’s spine. The question was
whether the two year limitation period barred the ensuing lawsuit.

[53]        
The court in Peixeiro noted that “discoverability as a general
rule applied to avoid the injustice of precluding an action before the person
is able to raise it” and that the concept was applicable to any limitation
periods triggered by the date “when the cause of action arose”. The court
noted,

in balancing the defendant’s
legitimate interest in respecting limitation periods and the interest of the
plaintiffs, the fundamental unfairness of requiring a plaintiff to bring a
cause of action before he could have reasonably have discovered that he had a
cause of action is a compelling consideration. The diligence rationale would
not be undermined by the application of the discoverability principle as it
still requires reasonable diligence by the plaintiff” [para. 39].

[54]        
One might question whether due diligence was exercised by or on behalf
of the plaintiff in the period following May 20, 2011 when the investigation
report was first provided to plaintiff’s counsel. The report did not actually
identify the persons responsible for the dowel problem on the oil distribution
box and further investigation was required. Still, even if “discoverability”
principles only trigger the “start date” for the ultimate three year limitation
period in s. 140 of the MLA as early as May 20, 2011, that period has
still not expired.

[55]        
In light of the above conclusion, it is not necessary to decide the
intriguing question whether the application of BC’s Limitation Act is
available in this case and whether its application is constitutionally
permissible by virtue of Marine Services International Ltd. v. Ryan Estate,
2013 SCC 44. That case held that a Provincial law (worker’s compensation legislation)
could and did apply to bar a maritime negligence claim pursuant to the two-part
test adopted since the earlier and now overruled decision of Ordon Estate v.
Grail, [1998] 3 S.C.R. 437.

[56]        
The two-part test that must be met to trigger the doctrine of
interjurisdictional immunity was articulated in Quebec (Attorney General) v.
Canadian Owners and Pilots Association, 2010 SCC 39 and repeated in Marine
Services to be,

1.    
to firstly determine the whether the Provincial law (here the Limitation
Act) trenches on the protected “core” of a federal competence (here
parliament’s jurisdiction over navigation and shipping); and

2.    
if so, to determine whether the Provincial law’s effect on the exercise
of the protected federal power is sufficiently serious that it rises to the
level of impairment.

[57]        
In my view, inasmuch as the Provincial Limitation Act directly
impacts fundamental issues such as the timing and limitation periods applicable
to marine liability lawsuits, it can indeed be said to trench on the core of
parliament’s navigation and shipping power. The more difficult question is whether
any such impact rises to the level of “impairment”.

[58]        
In Marine Services, the court reaffirmed that “impairment”
suggests “an impact that not only affects the core federal power, but does so
in a way that seriously or significantly trammels the federal power”. Such
“intrusion on the exercise of the federal power … need not paralyze it, but it
must be serious”.

[59]        
In the result, the court in Marine Services held that although
the worker’s compensation legislation,

…may affect the exercise of the
federal power over navigation and shipping, this level of intrusion into the
federal power is insufficient to trigger interjurisdictional immunity. The
intrusion of s. 44 is not significant or serious when one considers the breadth
of the federal power of navigation and shipping, the absence of an impact on
the uniformity of Canadian maritime law, and the historical application of
worker’s compensation schemes in the maritime context.

[60]        
The third factor mentioned above, historical application of worker’s
compensation schemes, obviously does not apply to the present case. The second
factor, absence of an impact on the uniformity of Canadian maritime law, may
also not apply given the differing limitation periods specified by differing
limitation legislation across the country. Indeed, it may well be the case, as
the respondents in this application argue, that the legislation actually conflicts
with the uniformity of the limitation periods specified in the MLA, a
result that would not only trigger interjurisdictional immunity but also the
doctrine of federal paramountcy discussed, albeit deemed inapplicable, in Marine
Services.

[61]        
In any event, as indicated, it is not necessary to make a definitive
ruling on these points as the earlier ruling respecting postponement of the s.
140 three year limitation period pursuant to the common law “discoverability”
principle is dispositive of the application.

Application of the Neilson Architects Principles

[62]        
Having determined that the claim against the proposed defendants Ulstein
Maritime Ltd. and Rolls-Royce Canada Limited are not barred by any limitation
period in the MLA, the application of the general principles reviewed in
the Neilson Architects case strongly militates in favour of adding those
two entities as defendants in this action. As indicated above, the first low
threshold requirement of R. 6-2(7)(c)(i) and (ii) is clearly met on the facts
of the case.

[63]        
The second requirement, namely a determination whether it would just and
convenient to decide the issues between the parties in this proceeding is also
met. Once it is clear there is no accrued limitation defence, the only question
is whether it will be more convenient to have one or two actions, since the
plaintiff will be able to commence a new action against the proposed defendants
should it be unsuccessful in this application. In my view, especially since the
present action has not proceeded very far, it is only common sense for all of
the claims to be decided in the same action.

[64]        
However, the same considerations do not apply insofar as they concern
the other two proposed defendants, Rolls-Royce PLC and Vickers PLC (actually
Vinters Limited). There is nothing in the evidence or the application materials
which establishes any meaningful connection between these two entities and the
allegedly negligent work of their subsidiaries. The evidence does not even meet
the low threshold of establishing a question or issue connected with the
plaintiff’s claim. The threshold may be low, but completely unsubstantiated
speculation does not alone suffice.

[65]        
Even if the low threshold requirement of an issue in dispute between the
plaintiff and these two entities were established on the face of the proposed
amended pleadings, I would nonetheless hold that it is neither just nor
convenient for such a claim to proceed. At best it would amount to a fishing
expedition wasteful of time and expense. At worst, and I do not say this is the
actual intent here, it might simply be designed to trigger such time and
expense for tactical purposes unrelated to the merits of the claim. In either
event, I am not prepared to put this Court’s stamp of approval on that aspect
of the plaintiff’s application.

[66]        
In result, it is ordered:

1.     Ulstein Maritime
Ltd. and Rolls-Royce Canada Limited are added as defendants in this action;

2.     The
application to add as parties to this action Kamewa Canada Inc., Rolls-Royce
PLC and Vickers PLC is denied;

3.     The
plaintiff is granted leave to amend her notice of civil claim in the manner as
set forth as schedule A to the amended notice of application except that:

                                         
(a)         
parties identified as ABC Company and John Doe 2 shall be deleted; and

                                         
(b)         
all allegations in the said notice of civil claim pertaining to ABC
Company, John Doe 2, Rolls-Royce PLC, Vickers PLC and Kamewa Canada Inc. shall
likewise be deleted.

[67]        
Should anything have occurred between the parties that might affect any
award of costs respecting this application, the parties may make submissions
forthwith on same. Otherwise, since success on this application has been
divided, each party will bear its own costs of this application.

“Kent J.”