IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20150408

Docket: 136051

Registry:
New Westminster

Between:

Christopher
Legault

Plaintiff

And

Christopher J.
Tiapis, Key Enterprises Ltd., Kylie Jessica Hawthorne,
Hong Kwan, Insurance Corporation of British Columbia

Defendants

And

Insurance
Corporation of British Columbia

Third
Party

Before:
Master Harper

Reasons for Judgment

I.                
introduction

[1]            
The defendant, Kylie Jessica Hawthorne (“Hawthorne”) and the third
party, Insurance Corporation of British Columbia (the “third party”) each apply
to strike portions of the amended notice of civil claim pursuant to Rule 9-5(1)
of the Supreme Court Civil Rules.

II.              
background

[2]            
The plaintiff’s claim is for damages for injuries allegedly arising from
a motor vehicle accident that occurred in Surrey, British Columbia on November 18,
2010 (the “accident”) in which the defendant Christopher J. Tiapis (“Tiapis”),
driving a vehicle owned by the defendant Key Enterprises Ltd. (“Key”) and
leased by Hawthorne, struck the plaintiff’s vehicle.

[3]            
Tiapis has been held in breach of his insurance policy because he had a
learner’s licence and did not have a supervising driver with him at the time of
the accident.

[4]            
The amended notice of civil claim alleges, among other things, that
Tiapis negligently operated the motor vehicle thus causing the accident and
injuring the plaintiff and that Tiapis drove the vehicle with the consent,
express or implied, of Key and Hawthorne. In her response to the notice of
civil claim, Hawthorne denies that the defendant Tiapis operated the vehicle
with her consent.

[5]            
One of the material facts the plaintiff will seek to prove at trial is
that Tiapis drove the vehicle with the express or implied consent of Hawthorne.

[6]            
The plaintiff filed an amended notice of civil claim which includes the
following additions:

3.1 The Defendant, Kylie Jessica Hawthorne, leased
the vehicle from Key, with the intended purpose of using the vehicle in the
purchase, sale and distribution of illicit drugs.

7.         The Defendant, Tiapis,
fled the scene of the accident, as illicit drugs were in the Nissan vehicle.

 (the “impugned allegations”)

[7]            
Hawthorne seeks to strike the impugned allegations.

[8]            
The application of the third party is to strike paragraph 13 of
Part I of the amended notice of civil claim which reads:

13.       The Defendant, Tiapis, fled the scene of the
incident, and failed to remain at the scene, provide his name and identity, and
offer any assistance to the Plaintiff, which conduct was willful, wanton, and
deserving of punishment by this Honourable Court.

 (the “punitive damages claim”)

[9]            
In the alternative, the third party seeks an order that the punitive
damages claim be severed from the balance of the claims (which are being heard
by judge and jury at a trial scheduled for June, 2015) and be heard by judge
alone after the first trial.

[10]        
Tiapis was given a ticket for failing to remain at the scene of the
accident and has paid a fine of $368. He was also given a three-month driving
prohibition.

[11]        
 Rule 9-5(1) provides:

(1) At any stage of a proceeding, the court may order to be
struck out or amended the whole or any part of a pleading, petition or other
document on the ground that

(a) it
discloses no reasonable claim or defence, as the case may be,

(b) it is
unnecessary, scandalous, frivolous or vexatious,

(c) it may
prejudice, embarrass or delay the fair trial or hearing of the proceeding, or

(d) it is
otherwise an abuse of the process of the court,

and the court may pronounce
judgment or order the proceeding to be stayed or dismissed and may order the
costs of the application to be paid as special costs.

III.            
 hawthorne’S application

[12]        
A notice of civil claim must set out a concise statement of material
facts giving rise to the claim: Rule 3-2(b). Hawthorne says the impugned
allegations contain evidentiary facts, not material facts, and are therefore
unnecessary. In addition, she says that the pleading is embarrassing or
scandalous.

[13]        
The plaintiff argues that the impugned allegations are necessary to
allege a common enterprise between Tiapis and Hawthorne being the distribution
of drugs. He says that proving this common enterprise will help establish that
Tiapis drove the vehicle with the consent of Hawthorne and further, that the
impugned allegations assist the defendants in knowing the case they have to
meet. He argues that a pleading should only be struck if it fails to disclose a
cause of action.

[14]        
The plaintiff further argues that the allegations of criminality against
Tiapis describe his behaviour which gives rise to liability. In other words,
his criminal behaviour is a material fact that will help prove that he was
negligent in his driving.

A.             
Discussion

[15]        
The objection to the impugned allegations has nothing to do with failure
to disclose a cause of action and Hawthorne’s argument did not proceed on that
basis. The primary basis for Hawthorne’s application is that the impugned
allegations are not material facts.

[16]        
It is trite law that a notice of civil claim must contain material facts
only and not the evidence by which the material facts will be proved at trial. A
fact that could be used at trial to prove a material fact is an evidentiary
fact, and does not belong in a notice of civil claim. For the purpose of
analyzing whether a fact is material, the fact is assumed to be true.

[17]        
The difference between a material fact and an evidentiary fact is
explained in Jones v. Donaghey, 2011 BCCA 6 at para. 18:

[18] Thus, a material fact is the
ultimate fact, sometimes called “ultimate issue”, to the proof of which
evidence is directed. It is the last in a series or progression of facts. It is
the fact put “in issue” by the pleadings. Facts that tend to prove the fact in
issue, or to prove another fact that tends to prove the fact in issue, are
evidentiary or “relevant” facts. And, as Professor Thayer said at 197, “Issues
are not taken upon evidential matter.”

[18]        
The plaintiff has alleged in the amended notice of civil claim that
Tiapis negligently caused the accident and he provides particulars of the
alleged negligence. How the plaintiff proves at trial that Tiapis was negligent
will, of course,  involve adducing evidence that goes to that issue. Subject to
admissibility rulings such as prejudicial effect versus probative value, evidence
that Tiapis was engaged in behaviour at the time of the accident which distracted
him may be admitted by the trial judge because it goes to proving negligence. However,
even if that evidence is admissible at trial, and even if it is assumed to be
true for the purposes of this application that Tiapis was engaged in a drug
dealing operation at the time of the accident, that evidence should not be
pleaded in the notice of civil claim.

[19]        
A further material fact the plaintiff will attempt to prove at trial is
that Tiapis drove the vehicle with the consent of Hawthorne. How he proves that
material fact will involve adducing evidence going to the issue of consent. Evidence
of how Tiapis came to be driving Hawthorne’s vehicle at the time of the
accident will probably be relevant (subject to admissibility rulings made by
the trial judge). It may be that the trial judge will allow evidence to be
called that points to a relationship of some sort between Hawthorne and Tiapis.
By adducing such evidence, the plaintiff will hope to prove consent. That
evidence, however, is for trial and should not be included in the notice of
civil claim.

[20]        
In conclusion, the impugned allegations contain evidentiary facts. They
are “unnecessary” within the meaning of Rule 9-5(a)(b). On that basis, I order
that the impugned allegations be struck.

[21]        
The defendant Hawthorne also relies on Rule 9-5(1)(b) and (c) in that
the impugned allegations are embarrassing or scandalous. In assessing the
merits of the application under these subrules, the court can weigh the evidence.
See for instance, Willow v. Chong, 2013 BCSC 1083 at para. 20.

[22]        
Hawthorne relies on Brophy v. Hutchinson, 2003 BCCA 21. In that
case, counsel for the defendant referred to the plaintiff as a drug dealer. The
Court of Appeal stated at para. 42:

[42] Referring to the plaintiff
as a drug dealer was highly prejudicial and improper. It portrayed the
plaintiff as someone engaged in criminal activity. There is nothing in the
record to suggest the defendant could prove the allegation in any way other
than on cross-examination. And in any event, it was irrelevant to any matter in
issue before the jury. It could not assist the jury on any question of
liability or damages. The allegation could only be relevant to the plaintiff’s
credibility, if proven independently, and denied by the plaintiff. The statement’s
only purpose could have been to prejudice the jury.

[23]        
Since I have found that the impugned allegations should be struck
as failing to disclose material facts, it is unnecessary for me to deal with
the second basis for the application.

IV.           
The third party’S APPLICATION

[24]        
The third party’s application is to strike paragraph 13 quoted
above or, alternatively, to sever the issue of punitive damages so that the
punitive damages claim is decided at a later trial before a judge alone.

[25]        
The punitive damages claim as pleaded has three elements: first, that
Tiapis failed to remain at the scene of the accident; second, that he failed to
provide his name and identity [sic]; and third, that he failed to offer any
assistance to the plaintiff.

[26]        
 Although I was told that Tiapis received a “ticket”, no reference was
made to the legislation which gave rise to the ticket. I assume that it was
pursuant to section 69(1) of the Motor Vehicle Act, R.S.B.C. 1996, c.
318. The relevant provisions of section 69(1) that the plaintiff appears to be
referring to in his punitive damages claim are: failing to remain at the scene;
failing to provide his name and address in writing to the plaintiff and failing
to render all reasonable assistance.

A.             
Should the Punitive Damages Claim be Struck?

[27]        
Section 77 of the Insurance Vehicle Act, RSBC 1996, c. 231
gives the third party the right to contest the insured’s liability to any party
claiming against the insured, and to contest the amount of any claim made against
the insured as if the insurer were a defendant in the action. Accordingly, the
third party has standing to make this application on behalf of Tiapis.

[28]        
The third party argues that Tiapis leaving the scene of the accident does
not found a cause of action and the pleading discloses no reasonable claim and
should therefore be struck pursuant to Rule 9-5(1)(a). Alternatively, it says
that preserving the punitive damages claim would distract from the trial of the
issues and instead involve the parties in a dispute that is wholly apart from
the relevant issues, that it may prejudice, embarrass or delay the fair trial
of the proceeding and therefore should be struck pursuant to Rule 9-5(1)(c).

[29]        
The plaintiff argues that Tiapis leaving the scene of the accident is
conduct worthy of an award of punitive damages. He says that although leaving
the scene occurred after the accident itself, it was part of the aftermath and
is therefore sufficiently connected to the negligence claim. Finally, the
plaintiff argues that any doubt about whether to strike the claim should be
resolved in favour of allowing the claim to stand.

B.             
Discussion

[30]        
In an application to strike a pleading pursuant to Rule 9-5(1)(a) as
disclosing no reasonable claim, the facts pleaded are assumed to be true and no
evidence is admissible: Rule 9-5(2). However, in an application pursuant to the
other subrules of Rule 9-5(1), the court may look at the evidence. In the
present application, the third party relies on evidence about the punishment
Tiapis has already received for failing to remain at the scene of the accident.

[31]        
In considering the application of Rule 9-5(1)(a), I look only at the
pleading itself and no evidence. The question is: does the pleading disclose a
reasonable claim?

[32]        
In Whiten v. Pilot Insurance Co., 2002 SCC 18, the Supreme Court
of Canada at para. 94 emphasized the rigorous nature of the pleadings
required for punitive damages.

[33]        
In the present case, the punitive damages claim as pleaded does not
allege that the plaintiff sustained any injury as a result of Tiapis leaving
the scene. Further, the plaintiff does not allege that he required any
assistance or, alternatively, that he sustained any injury by Tiapis failing to
“render all reasonable assistance” as required by section 69(1) of the Motor
Vehicle Act. The pleading, in my view, is not as rigorous as is required. However,
is it plain and obvious that the claim will fail?

[34]        
Not only was no case authority provided in which a motorist had punitive
damages assessed against him or her for fleeing the scene of an accident, no
case authority even raising the possibility of such a claim was provided. Given
that failing to remain at the scene of an accident in which a plaintiff was
injured is not an uncommon event, I would have expected the issue to be
litigated in British Columbia by now if, indeed, the claim was tenable in
British Columbia.

[35]        
However, the novelty of the claim is in and of itself is not a
sufficient reason to strike it. It is not for me at this stage to comment on
the merits of the claim or the likelihood of success. Therefore, I decline to
strike the punitive damages claim under Rule 9-5(1)(a).

[36]        
I now turn to whether the punitive damages claim ought to be struck
pursuant to Rule 9-5(1)(c). On this analysis, I can consider the evidence,
including the fact that Tiapis has already been punished for failing to remain
at the scene.

[37]        
Punitive damages are reserved for situations where the defendant has
done more than inflict injury on others by his negligence or intentional acts.
He must have acted maliciously, or with such recklessness as to indicate an
indifference to the safety of others, or have engaged in some other type of
behaviour which is regarded as so socially reprehensible as to justify the
awarding of punitive damages: Robitaille v. Vancouver Hockey Club Ltd.
(1981), 30 B.C.L.R. 286 at 310 (C.A.).

[38]        
The purpose of punitive damages is to punish the defendant for malicious
conduct and that the damages are in the nature of a fine: Hill v. Church of
Scientology of Toronto, [1995] 2 S.C.R. 1130 (S.C.C.). The impugned act
must be directed at the plaintiff: Nichols v. Guiel 145 D.L.R.
(3d) 186 and cause the plaintiff injury: Vlchek v. Koshel (1988), 52
D.L.R. (4th) 371 (B.C.S.C.). In the present case, the plaintiff does not allege
that she was injured as a result of Tiapis leaving the scene. The only possible
“injury” sustained by the plaintiff as a result of Tiapis leaving the scene is
that he failed to “offer any assistance” to the plaintiff. The plaintiff does
not allege, however, that Tiapis’s failure to offer assistance resulted in any
injury.

[39]        
In Rioux v. Smith (1983), 48 B.C.L.R. 126 (C.A.), the
plaintiff was injured in a motor vehicle accident liability for which was
admitted on behalf of the defendant. The plaintiff claimed punitive and
exemplary damages against the defendant who was convicted of impaired driving
and fined $1,000 or 60 days imprisonment in default and placed on probation for
one year. The claim for punitive and exemplary damages was struck. The
plaintiff appealed. The Court of Appeal referred to punitive and exemplary
damages together as “exemplary damages”. It held that the plaintiff should not
be allowed to proceed with the claim for exemplary damages because the
defendant has already been punished for his conduct. He should not be punished
twice for the same offence.

[40]        
Whether punitive damages can be claimed in a products liability case was
addressed in Vlchek. In that case, a plaintiff was seriously injured
when she was thrown from an all-terrain vehicle. She alleged the manufacturer
of the vehicle was negligent and made other allegations which she said founded
the punitive damages claim. The court said at page 375:

While negligence or an
intentional act can trigger an award of exemplary damages, it does not follow
that the act must be directed towards a specific individual. But the act must
be malicious or reckless to such a degree as to indicate complete indifference
to the consequences that might flow therefrom, including the welfare and safety
of others. In other words, intention to cause injury need not be present; it
will suffice if there was an intention to do the act which eventually caused
the injury. The act alleged in this case was the manufacturing of inherently
dangerous and unstable machines which were sold and used by the general public.

The court concluded that punitive damages can be awarded in
a products liability case if the circumstances so warrant.

[41]        
The plaintiff cited a 2006 Ontario Court of Appeal decision, McIntyre
v. Grigg, 83 O.R. (3d) 161 (C.A.), in which punitive damages were
awarded against a defendant whose blood alcohol level at the time of the
accident was two to three times over the legal limit. The crown did not proceed
with impaired driving charges because the defendant had not been informed of
his right to counsel before the breathalyzer test. The defendant pleaded guilty
to traffic offences and paid a fine of $500. The crown attorney testified at
the plaintiff’s trial that had the defendant been convicted of impaired
driving, the crown would have expected the defendant to be sentenced to a
period of incarceration. The jury awarded $100,000 in punitive damages. The
award was reduced to $20,000 by the Court of Appeal in a two to one decision. The
majority decision described the case as “novel” in that no Canadian case
authority was provided in which punitive damages were awarded as a result of
injuries sustained in a motor vehicle accident caused by an impaired driver,
nor were the parties able to produce any appellate authority that prohibited
such damages in this context (para. 55). The majority of the Court of
Appeal was of the opinion that it was open to the jury to find that punitive
damages did not amount to double punishment and that the conduct was more
serious than careless driving for which the defendant had been fined. However,
the quantum of damages was found to be too high to meet the rationality test. The
award of $100,000 was disproportionate to the misconduct and therefore the
quantum was reduced to $20,000.

[42]        
In a thoughtful dissent, Justice Blair would have dismissed the claim
for punitive damages.

[43]        
The plaintiff argues that since McIntyre post-dates Rioux and
Vlchek, McIntyre should be preferred. In my opinion, at the very
least, given that McIntyre appears to leave the door open for a punitive
damages claim where the tortfeasor has already been punished, any doubt should
be resolved in favour of allowing the claim to stand.

[44]        
In the present case, Tiapis returned to the scene of the accident. There
is no evidence that the plaintiff required assistance from Tiapis at the scene.
There is no evidence the plaintiff sustained any further injury by Tiapis
leaving the scene. However, I cannot say definitively that the punitive damages
claim will prejudice or embarrass the fair trial of the proceeding.

[45]        
It may be that the punitive damages claim will delay the fair trial of
the proceeding, but it is my expectation that the parties will conduct the
trial efficiently and, in any event, as will be seen from my ruling on the
alternative claim, the trial judge may deal with the punitive damages claim as
part of his or her discretion in controlling the trial process.

[46]        
Although the punitive damages claim may in some respects distract from
the trial of the main issue being the plaintiff’s personal injury claim, in my
view, the balance does not tip so far that the claim should be struck pursuant
to Rule 9-5(1)(c).

[47]        
In the result, I dismiss the application that the punitive damages
claim be struck.

C.             
Alternatively, should the Punitive Damages Claim be Severed?

[48]        
Rule 12-5(67) provides that the court may order that one or more
questions of fact or law arising in an action be tried and determined before
the others.

[49]        
In Chester v. Campbell (Victoria Registry 10-1595), the
defendants applied at the commencement of trial by judge and jury for an order
striking the plaintiff’s claim for punitive damages or, in the alternative, an
order severing the issue of punitive damages such that the claim would be heard
by judge alone. The action was a personal injury claim arising out of a motor
vehicle accident. The defendant driver received a 90-day suspension and a
violation ticket for driving without due care and attention pursuant to the Motor
Vehicle Act. A judge in chambers had previously granted the plaintiff’s
application to amend his pleadings to include the claim for punitive damages.
That order was not appealed. The reasons for judgment of the chambers judge
were not ordered and were therefore not before Justice Power.

[50]        
Justice Power ordered severance and that she be the trial judge to hear
the punitive damages claim.

[51]        
Although there is nothing in Rule 12-5(67) to preclude a judge or master
on an interlocutory application from ordering severance, given that the only
authority provided by the applicant was Chester, I would defer this
application to the trial judge. I find support for this position also in Astels
v. The Canada Life Assurance Company, 2006 BCSC 2099, relied
on by the plaintiff, in which the trial judge considered such an application.

[52]        
The application to sever also includes an application that the punitive
damages claim be heard by a judge alone. Essentially, this part of the application
is an application to strike the jury notice for a portion of the trial. I do
not accede to that request. On this issue, I defer to the trial judge in
consideration of the trial judge’s discretion to control the trial process.

V.             
SUMMARY

[53]        
Hawthorne’s application to strike paras. 3.1 and 7 of the amended notice
of civil claim is granted.

[54]        
The third party’s application to strike para. 13 of the amended notice
of civil claim is dismissed.

[55]        
The third party’s application for an order that the issue of punitive
damages be severed from the balance of the claims and be heard by judge alone
is adjourned generally.

[56]        
The plaintiff will pay Hawthorne her costs of this application in any
event of the cause.

[57]        
Costs of the third party’s application will be in the cause.

____________ “Master
Harper”_____________
Master Harper