Shelburne (Town) v. The Farley Mowatt, 2017 FC 1184  

Facts: The plaintiff was the operator of a marine terminal and marina. The plaintiff and defendant entered into a “Berthing Agreement” pursuant to which the defendant was permitted to berth the defendant vessel at the marina. While the defendant was in arrears on the moorage, the vessel sank at the marina. The vessel was refloated by the Canadian Coast Guard and the plaintiff also incurred some expenses in relation to the refloating. The plaintiff commenced this proceeding to those expenses, moorage and its legal costs. The defendant counterclaimed alleging the plaintiff prevented him from accessing the vessel which led to the sinking. Subsequently, the court made several orders requiring the defendant to remove the vessel from the marina. The defendant failed to do so and was arrested and imprisoned. The plaintiff then brought this motion for summary judgement.

Decision: Judgement granted.

Held: The plaintiff is awarded the berthing fees to which it is entitled under the Berthing Agreement. The plaintiff is additionally entitled to the costs incurred in connection with the sinking and refloating of the vessel. With respect to the counterclaim, there is no evidence that any actions or omissions of the plaintiff contributed to the damage to the defendant vessel. The plaintiff is also entitled to recover its legal fees directly related to the recovery of the unpaid berthage fees as provide for in the Berthing Agreement.

Moray Channel Enterprises Ltd. v. Gordon, 2017 FC 250  

Facts: The plaintiff, the owner and operator of a marina, entered into a moorage agreement with the defendant, the owner of a float home that was a registered vessel. The defendant failed to pay for moorage and related services and the plaintiff commenced this action. The defendant filed a defence alleging the plaintiff overcharged and misrepresented the charges.

Decision: Judgment for the plaintiff.

Held: Although the plaintiff was negligent in its invoicing procedures, which caused much confusion, it has established that the defendant is in arrears and is entitled to damages.

Quebec v. IMTT-Quebec Inc., 2016 QCCS 4337  

Not yet available.

Forsey v. Burin Peninsula Marine Service Centre, 2014 FC 974  2015 FCA 216

Facts: The plaintiff’s/respondent’s fishing vessel was lifted out of the water and placed on a cradle at the premises of the defendant/appellant for the purpose of repairs and maintenance. The cradle failed 13 days later causing the vessel to fall, as a consequence of which it was damaged. The respondent claimed against the appellant for the damages to the vessel and for the costs of fuel containment and clean up. The appellant denied liability saying the cradle was constructed by the respondent and further relied upon a sign that provided “Boats stored at Owner’s Risk” and an exclusion clause that provided:

“I understand and agree that the securing and locking of my boat is my responsibility, and not that of the said Marine Service Centre, or of its agents, servants, employees, or otherwise. Furthermore I agree to indemnify and save harmless the said Marine Service Centre and its officers, agents, employees, servants or otherwise from, any claims on my part with respect to the same.”

At first instance (2014 FC 974) the trial Judge held that a bailment was created and that the cradle had been constructed by the defendant. As bailee, the burden was on the appellant to prove that it was not negligent in relation to the fitness of the materials used to construct the cradle and the manner in which it was constructed. She held that this onus had not been discharged. In doing so she noted that the materials used to construct the cradle were disposed of by the appellant within 48 hours of the incident. She held that this gave rise to a presumption that the materials were intentionally destroyed, which was not rebutted, and an adverse inference that the materials were unfit. With respect to the exclusion clause, the trial Judge held that neither the sign nor the exclusion clause in the contract expressly or impliedly excluded liability for negligence. She also applied the rule of contra proferentum to the words “securing and locking” in the exclusion clause and held that they did not transfer responsibility for the safety of the vessel to the respondent. In result, the respondent was entitled to damages for the vessel (which was declared a constructive total loss), the containment and clean-up costs and the costs of a surveyor. The survey costs were recoverable notwithstanding they were not paid for by the respondent on the grounds that they were a natural and probable consequence of the tort. The appellant appealed.

Decision: Appeal dismissed.

Held: The two issues on appeal are whether the trial Judge erred in drawing an adverse inference for destruction of evidence and whether she erred in her interpretation of the exclusion clause. The appellant argues there was no evidence supporting an inference the cradle materials were intentionally destroyed and that the issue was not pleaded and was raised by the trial Judge propio motu. It argues that procedural fairness was breached as it was not given a chance to respond to the trial Judge’s theory of the case. The respondent, however, notes that the issue had been pleaded, raised in advance of the trial and was argued at trial. In the circumstances, there was no procedural unfairness. The true question is whether the trial Judge made a palpable and overriding error in concluding the appellant failed to rebut the inference of negligence. The appellant as bailee had the onus of proving it was not negligent which required it to prove the materials used to construct the cradle were in good condition. Having removed those materials, the appellant could not disprove the presumption of negligence. There was no need on the part of the trial Judge to find the appellant intended to destroy the materials.

With regard to the exclusion clause, the parties disagree as to the meaning of the words “securing and locking”. The appellant says these words refer to the placing of the vessel on the cradle whereas the respondent says they refer to the securing of lines, buoys and equipment and the locking of hatches, doors and windows. The trial Judge applied the contra proferentem rule of construction and, because it was clear the erection of the cradle was the responsibility of the appellant, held the words could not have had the meaning advocated for by the appellant. There is no basis to interfere with this holding. The main concern of contractual interpretation is to determine the parties’ intent and scope of their understanding. This is not a question of pure law but of mixed fact and law and can only be interfered with on appeal if there is a palpable and overriding error. There is no such error. Moreover, even if the word “securing” was given the meaning advocated for by the appellant, the clause would not protect it since it is not an exclusion clause. Once the appellant assumed the responsibility for securing the vessel, it was bound to secure it properly.

Goodrich Transport Ltd. v. Vancouver Fraser Port Authority, 2015 FC 520  

Facts: The Port of Metro Vancouver had been plagued with labour issues relating to the drayage of containers to and from the port for many years. In an effort to resolve the issues, the licencing system was changed to, inter alia, decrease the number of trucks used to service the Port’s requirements. The Port evaluated the licence applications received based upon various published criteria but the applications were processed in batches rather than at a single time. The Port did not advise that applications were to be evaluated in this way. The result was that some of the applications that were processed at a later point in time were denied licences even though those applicants had higher scores than applicants who had been processed earlier. A number of the applicants who were denied licences brought this proceeding for judicial review.

Decision: Application allowed.

Held: The Port had a duty of fairness in relation to the evaluation of the licence applications. The Applicants were entitled to a fair, impartial and open process. Effective notice is at the heart of procedural fairness. The Port had published the criteria that would be used to evaluate licences and was under no duty to advise in advance exactly how the different criteria would be weighted. However, “fairness demanded the disclosure of the more onerous scoring system that applied to later applications”. The Port is to re-assess the licence applications of the applicants “in accordance with the most favourable benchmark applied to any of the successful licensing applications”.

Comment: See also ATL Trucking Ltd. v. Vancouver Fraser Port Authority, 2014 FC 420, where it was held that the Port was a “federal board, commission or tribunal” and its decision was subject to judicial review by the Federal Court.

ATL Trucking Ltd. v. Vancouver Fraser Port Authority, 2015 FC 420  

The Port of Metro Vancouver had been plagued with labour issues relating to the drayage of containers to and from the port for many years. In an effort to resolve the issues, the licencing system was changed to, inter alia, decrease the number of trucks used to service the Port’s requirements. The Port evaluated the licence applications received based upon various published criteria but the applications were processed in batches rather than at a single time. The Port did not advise that applications were to be evaluated in this way. The result was that some of the applications that were processed at a later point in time were denied licences even though those applicants had higher scores than applicants who had been processed earlier. A number of the applicants who were denied licences brought this proceeding for judicial review.The Port then filed this application to strike the proceeding on the basis that the Port's decision was not subject to judicial review by the Federal Court.

Decision: Motion dismissed.

Held: The Port is a “federal board, commission or tribunal” and its decision was subject to judicial review by the Federal Court.

Comment: See also Goodrich Transport Ltd. v. Vancouver Fraser Port Authority, 2015 FC 520 where the application for judicial review was allowed.

Capitaines Propriétaires de la Gaspésie (A.C.P.G.) Inc. v.  Pêcheries Guy Laflamme Inc., 2014 FC 456  2015 CAF 78

Facts: The fishing boat "Myrana I" was damaged when it was dropped into the water while being lifted with a crane. The ship owner demanded damages in excess of $550,000 from the crane operator and its employee operating the crane at the time. The crane operator and employee denied liability and further asserted that they were protected by an exclusion clause in the contract. The crane operator, its employee and their insurer commenced this action for a declaration that they had no liability. The defendant ship owner counter-claimed for damages to the ship. The exclusion clause in the contract provided "I accept liability for any risk resulting from the towage, docking, wintering and/or launching of this vessel, and I release the Owner of this dry dock and its Operator, ____, from any civil liability resulting from these associated operations or handling".

At first instance (2014 FC 456), the trial Judge held the plaintiffs had failed to rebut the presumption that they were liable as bailees. However, the Judge further held the exclusion clause was broad enough in scope to cover any negligence. The Judge relied on Tercon Contractors v British Columbia, 2010 SCC 4, where Justice Binnie said "There is nothing inherently unreasonable about exclusion clauses..." and added that there are many valid reasons for contracting parties to use exemption clauses, most notable to allocate risks. The trial Judge further held that the clause was neither abusive nor draconian and that the defendant should have been aware of it as the contract was sent to the defendant on at least 36 prior occasions. The defendant appealed.

Decision: Appeal dismissed.

Held: The interpretation of a contract is a question of mixed fact and law and is reviewable only if the trial Judge made a palpable and overriding error. The same is true of the Judge’s conclusion as to whether the exclusion clause was harsh or unconscionable. The defendant argues that the clause does not expressly exclude negligence and the trial Judge failed to read it contra proferentem. However, the clause in question releases the plaintiff from “any civil liability” and it is clear that the term “liability” is synonymous with negligence. There was no ambiguity in the clause so as to attract the contra proferentem doctrine. In addition, the Judge’s finding that the defendant was bound by the exclusion clause is supported by the evidence as is his conclusion that the clause was not abusive or draconian. “Allocating the risks makes it possible to avoid disputes and the great expenses these entail.”

Ranjbar v. Islamic Republic of Iran Shipping Lines, 2014 BCSC 1983  

Facts: The plaintiff, a ship’s cook, fell from a gangway while boarding a vessel at a terminal in the Port of Prince Rupert and fractured his right femur. The gangway was owned and operated by the terminal. It was an unmanned automatic lifting gangway that moved up and down and side to side as the position of the ship shifted. A horn would sound before movement of the gangway was initiated and posted signage warned that the gangway should be cleared immediately when the horn sounded. The plaintiff was thrown from the gangway onto the deck of the ship when it raised automatically. The plaintiff had heard the horn sound but did not understand its purpose. He had not seen the posted signs and would not have understood them in any event as he had a very limited knowledge of the English language. The plaintiff commenced these proceedings against the owner of the vessel and against the terminal. The defendants each alleged that the other was responsible and that the plaintiff was contributorily negligent. Damages were agreed except for past and future wage loss and it was alleged the plaintiff failed to mitigate.

Decision: The terminal is 100% liable for non-pecuniary damages which are reduced by 15% for failure to mitigate.

Held: The terminal owed a duty to persons using the gangway to take reasonable care that the gangway was safe from an unusual danger of which the terminal was aware. An unusual danger is one that is not usually found in the place concerned and depends on the class of persons involved. A danger that is usual for one class of persons may be unusual for another class. Prior safe use is a factor to be taken into account in assessing whether something constitutes an unusual danger and whether reasonable care was taken but is not determinative. Where an occupier knows of an unusual danger it must warn users of the danger but a warning is only adequate if it provides sufficient detail about the danger such that the users understand the full danger and how to act to avoid it. Here the gangway posed an unusual danger even though it had been used for 24 years without a mishap. Adequate steps were not taken by the terminal to notify users of the danger. The signs were inadequate and confusing especially for persons who could not read and understand English, a foreseeable issue at a terminal. The terminal could easily have taken other measures to warn users. The failure to adequately warn the plaintiff of the danger was the cause of the plaintiff’s fall and injuries and the terminal is liable.

The ship owner also owed a duty to the plaintiff and other crew members to take reasonable care for their safety. If the ship owner knows of a dangerous condition it should ensure the condition is addressed and made safe. In this case, the ship owner was not aware of the danger posed by the automatic gangway and is therefore not liable.

The plaintiff was not contributorily negligent. He was not aware of the risk and could not have been reasonably aware of the danger posed by the gangway. In the circumstances, he took reasonable precautions for his own safety.

The plaintiff is entitled to non-pecuniary damages in the agreed amount of $95,000. The plaintiff also claimed $100,000 for past wage loss during the four years between the accident and trial and $300,000 for loss of future earning capacity. However, the plaintiff elected to remain in Canada following the accident but he lacked motivation to learn English and was not competitively employable, regardless of the injury. It is extremely unlikely the plaintiff could obtain employment in Canada even if the injury had not occurred. In these circumstances, no award is made for past wage loss or loss of future earning capacity.

A plaintiff has an obligation to take all reasonable measures to reduce his damages, including undergoing surgery to alleviate or cure injuries. The defendant has the burden of showing the plaintiff has failed to mitigate his damages, including to prove that the plaintiff acted unreasonably in avoiding the recommended treatment and the extent to which the plaintiff’s damages would have been reduced if he had acted reasonably. Here, the plaintiff has unreasonably refused recommended surgery and physiotherapy which would have reduced his pain and discomfort and increased mobility and function. Accordingly, damages are reduced by 15% for failure to mitigate.

Mercury Launch & Tug Ltd. v.  Texada Quarrying Ltd., 2006 FC 464     

The barge “MLT HWY” was damaged when she broke her moorings in extreme weather and grounded upon nearby rocks. The Plaintiff was the owner of the barge, which had been moored at the Defendant's facility for the loading of a cargo of crushed stone. The Plaintiff's tug, which had towed the barge to the facility, was moored to a buoy 0.75 miles from the facility awaiting the completion of the loading. The contract between the Plaintiff and the purchaser of the cargo, who was not a party, provided, inter alia, that the Plaintiff was to have the care, custody and control of the barge at all times. The Plaintiff alleged that the Defendant was a bailee of the barge and had the onus of proving the absence of fault on its part. The Plaintiff further alleged that the Defendant had failed to provide a safe berth, failed to provide sufficient mooring lines and failed to monitor the weather or advise it of developing bad weather. The Court noted that bailment involved a transfer of possession and required a high degree of physical control over the chattel and further noted that the Defendant had accepted the barge at its berth, had assumed responsibility for providing lines, had monitored and adjusted the lines, and maintained a barge loader at the berth to keep an eye on the barge. The Court further noted, however, that the Master of the tug knew he was responsible for deciding whether the barge should leave the berth because of bad weather and that the Plaintiff expected the Master to make this decision. The Court said that if the barge had been manned or if the tug had remained at the berth she would have had no difficulty in concluding there was not a bailment. The fact that the tug was 0.75 miles away and moored to a buoy did not alter this conclusion. In the Court's view “the keys to the barge were not delivered to” the Defendant and there was no bailment. The Court further said that even if there had been a bailment it would not have reversed the onus of proof as it was not a “pure bailment”. The Court next considered the various allegations regarding safe berth and negligence. The Court concluded that the berth was not unsafe merely because the barge had to be removed in bad weather as this was a well known fact. The Court rejected the other allegations of negligence, finding that the cause of the loss was the failure of the Master of the tug to monitor the deteriorating weather at the dock and his failure to remove the barge from the dock.

Mosquito Creek Marina v. Malecek, 2006 BCPC 139     

In this matter the Defendant had moored her pleasure vessel at the Plaintiff's marina for a number of years. During that time moorage was paid, sometimes in cash, to the marina's bookkeeper. The bookkeeper had apparently not been recording all payments received and was fired. The new bookkeeper after reviewing the books determined the Defendant owed $15,000 in back moorage and, when the Defendant refused to pay, had her boat removed from the water as incentive for her to pay. The vessel was damaged when it was being removed from the water. The marina brought this action for the moorage allegedly owed and the Defendant counter-claimed for the damage to her vessel, loss of use during the wrongful seizure and for punitive damages. The claim for moorage was dismissed on the grounds that the marina was unable to establish any amount owing. The counter-claim for the damage to the vessel was allowed including an award for the diminution in the value of the vessel as a consequence of the damage. The counter-claim for loss of use during the wrongful seizure was also allowed in the amount of $1,000. The claim for punitive damages was, however, dismissed on the grounds that the marina believed it had some authority to remove the vessel.

Canada  v. Cote, 2005 CanLII 33542     

In this matter a vessel had been moored in an area of the harbour controlled by the municipality and the owner had refused to move the vessel when requested to do so. The municipality then seized and detained the vessel and brought this application for the sale of the vessel under s.19 of the Fishing and Recreational Harbours Act. The Court allowed the application and ordered the vessel sold by public tender with the proceeds to be paid to cover the costs of sale and the costs of the seizure and maintenance of the vessel.

Dryburgh  v. Oak Bay Marina (1992) Ltd., 2001 FCT 671     

This was an action for damages caused to a pleasure craft when docks at the Defendant marina broke apart during a severe wind storm. The claim was against the marina and its President. The Plaintiff alleged that the marina was poorly designed and constructed and that the President oversaw the design and construction. The Defendants argued that they were protected by an exclusion clause in the moorage contract signed by the Plaintiff. The exclusion clause provided:

“All vessels, boathouse and ancillary equipment of the Owner stored or moored on the Company’s premises shall be solely at the Owner’s risk, and the Company shall not be responsible under any circumstances for any loss oher caused by negligence of the Company, its servants or agents or the acts of third parties, or otherwise.”

On the face of the contract were the names of three entities, one of which was the Defendant marina. There was a mark in the box next to the name of the Defendant Marina. The Plaintiff argued that the exclusion clause did not apply to relieve the Defendants of liability because the identity of “Company” was ambiguous, the clause did not extend to past defects in design or construction of the marina, and the clause did not apply to the Defendant President. On the first point the Prothonotary held that it was clear that the contract was between the Plaintiff and the Defendant marina. On the second point, the Prothonotary noted that the exclusion clause was very broadly worded. It referred to any loss or damage without limitation. The Prothonotary held that to interpret the contract in the manner suggested by the Plaintiff would be to distort the contract and produce an unrealistic result not in accord with commercial reality. On the final point, the Prothonotary held that the President was protected by the test set out by the Supreme Court of Canada in London Drugs Ltd. v Kuehne & Nagel Ltd., [1993] 1 W.W.R. 1, in that, by implication it was intended that the benefit of the exclusion clause would extend to the President and the President was acting in the course of his employment. In the result, the exclusion clause was enforced and the Plaintiff’s claim was dismissed. An appeal by the Plaintiff was dismissed for substantially the same reasons as given by the Prothonotary. The Appeal Judge did note that he found it difficult to accept that the term “Company” as used in the exclusion clause should be interpreted to include the Defendant’s President but, given the decision of the Supreme Court of Canada in London Drugs Ltd. v Kuehne & Nagel Ltd. he concluded that view was not open to him.

Laursen  v. Bemister, 1999 CanLII 6059     

This was an action in negligence, breach of contract and bailment against the Defendant in respect of damage to the Plaintiffs' vessels that were stored in the Defendant's barn when the roof collapsed under a snow load. The action was dismissed. The court held that the Defendant was aware of the potential risk from snow accumulation but took reasonable steps, including daily inspections, to care for the Plaintiffs' property. Thus, the Defendant was not negligent and had complied with the implied term of the contracts that he would use reasonable care in storing the Plaintiffs' property. On the issue of bailment, the court held that the relationship between the Plaintiffs and Defendant was one of licence and not bailment. In reaching this conclusion the court found that the Plaintiffs had not provided the Defendant with access to their chattels nor the means of moving same and that the barn was open to all. Therefore, the court held, the Defendant did not have exclusive possession of the Plaintiffs' chattels, a necessary element of bailment.

LeCleir Bros. Contracting Ltd v. Canoe Cove Marina Ltd., 1999 CanLII 6199     

This case concerned the interpretation of a marina moorage contract. The Plaintiff had moored his boat and boathouse at the Defendant marina for many years. The moorage agreement gave the Defendant the right the cancel the agreement and demand the immediate removal of the Plaintiff's personal effects. It also provided for a right of renewal upon 30 days. The Defendant damaged the Plaintiff's boathouse. As a consequence, the relationship deteriorated and the Defendant sent a letter purporting to terminate the agreement at the end of its annual term. In response, the Plaintiff purported to exercise the right of renewal. The Defendant argued that the renewal was ineffective as the agreement had been terminated. The court held that the letter terminating the agreement was ineffective as the Defendant had elected to allow the agreement to continue until the end of its terms. The court further held, however, that the renewal clause in the agreement was too vague and uncertain to be enforceable as it did not stipulate the rent payable. The court further held that the agreement was subject to the implied terms that it would not be terminated without good reason and that, in the event of termination, reasonable notice would be given.

Robin Maritime Inc. v. Chemarketing Industries, 1998 CanLII 8624     

This was an action for wharfage dues. The Plaintiff, an agent for the vessel owner, paid wharfage dues to the Port of Montreal and sought reimbursement from the Defendant, the charterer of the vessel and consignee of the cargo. The Plaintiff claimed that it either paid the charges as agent for the Defendant or that it was entitled to be reimbursed pursuant to the terms of the charterparty between the Defendant and vessel owners. The Court held that the Plaintiff acted only as agent for the vessel owner and had never been appointed as agent for the Defendant. Further, the Court held that the claim for wharfage was made out of time as the terms of the charterparty required that any claims against the charterers be presented within 90 days of discharge. An alternate claim based on unjust enrichment was also dismissed.

Swinburne  v. Dike, 1995 CanLII 2374     

This was a summary judgment application by a group of small vessel owners against a marina for damage caused to their vessels when the marina broke apart during a severe storm. In defence of the claims the marina relied upon an exclusion clause in the moorage contracts that exempted it from liability for "loss of or damage to any property of the owner". The Court held that this clause did not apply to vessels which, in other parts of the contract, were distinguished from other property. In doing so the Court relied upon the well established principle that exclusion clauses must be clear and unambiguous and that any ambiguity would be strictly construed against the person attempting to rely on the exclusion. The Court further held the exclusion clause was not sufficient to exculpate the marina from its duty to warn of the dangerous condition of the docks.