IN THE SUPREME COURT OF BRITISH COLUMBIA

Citation:

Brach v. Great-West Life Assurance Company,

 

2018 BCSC 784

Date: 20180419

Docket: S116496

Registry: Vancouver

Between:

Inderjit Brach

Plaintiff

And

The Great-West Life Assurance Company and in French, La Great-West, Compagnie D'Assurance-Vie and CEVA Freight Canada Corporation

Defendants

Before: The Honourable Mr. Justice Kent

Oral Reasons for Judgment

In Chambers

Counsel for Plaintiff:

Mandeep S. Randhawa

Counsel for Defendant CEVA Freight Canada Corporation:

Michael J. Schalke

Place and Date of Hearing:

Vancouver, B.C.

April 19, 2018

Place and Date of Judgment:

Vancouver, B.C.

April 19, 2018

 

[1]             THE COURT:  The defendant CEVA Freight Canada Corporation ("CEVA") applies for an order dismissing this action and seeks special costs.

[2]             The application for dismissal is multifaceted.  It is firstly brought under Supreme Court Civil Rule 9-5(1)(a) on the basis that the pleading discloses no reasonable claim.

[3]             In the alternative, it is brought pursuant to Rule 9-7 as a summary trial application, and, in the further alternative, pursuant to Rule 22-7(7) on the basis that there has been want of prosecution.

[4]             The background is that the plaintiff was an employee of CEVA, and went on medical leave in September 2009.  She has not yet returned to work with CEVA.  She is carried on CEVA's books as an employee who is on leave, as opposed to a former employee whose employment has been terminated.

[5]             The co-defendant, Great-West Life, issued to CEVA a group policy for the benefit of its employees.  That policy extended life insurance benefits, accident and health benefits, as well as disability income insurance benefits.

[6]             The plaintiff made application to Great-West Life for disability insurance benefits.  Her claim was denied.  Great-West Life admits that the plaintiff was covered under their plan; however, it takes the position that her claim does not meet the test for coverage under the policy.

[7]             In September 2011, the plaintiff issued her Notice of Civil Claim naming Great-West Life and CEVA as defendants.  The statement of facts in that pleading is commendably concise, comprising only seven single-sentence paragraphs.

[8]             Paragraph 4 alleges the contract of insurance was made between the plaintiff and the defendants, i.e., it is framed in the plural and expressly alleges that both defendants agreed to insure and indemnify the plaintiff for the matters covered by the contract of insurance.

[9]             The plaintiff concedes in this application that CEVA is not an insurer and did not agree to insure and indemnify her for the matters specified in the contract of insurance issued by Great-West Life.  In other words, by that admission, and even though her pleading is framed otherwise, the plaintiff concedes that she has no proper claim against CEVA under the contract of insurance.

[10]         The litigation has not been proceeding with dispatch.  CEVA has had little or no involvement beyond filing its Response to Civil Claim.  It is noteworthy that its Response to Civil Claim expressly points out that any obligation to pay disability insurance benefits pursuant to the policy is that of Great-West Life alone and not CEVA, and that CEVA neither issued nor breached the policy upon which the plaintiff's claim was framed.  It expressly states:

The plaintiff has no claim against the defendant CEVA.

[11]         Counsel for the plaintiff says that the claim was framed in this fashion because of the absence of certainty respecting the nature of the contract of insurance and the role played by CEVA in that regard.  I am not impressed by this submission.  An acknowledgment that one has issued a lawsuit against a party not knowing whether a proper claim existed against a defendant is not a course of conduct to be encouraged at the bar.

[12]         CEVA has not been examined for discovery and, indeed, has not been involved in the discovery process.  It has not produced a list of documents, although I would point out that is non-compliance with the Rules, which make such listing of documents mandatory upon the close of pleadings.

[13]         While it is not expressly admitted, the obvious inference is that CEVA was content to sit back and allow the claim to be pursued as against Great-West Life in the expectation that in due course and at minimal legal cost, the claim against it would eventually disappear once entitlement to benefits under the policy was resolved.

[14]         I have not been provided with any information why this action has not yet proceeded to trial.  It appears CEVA ran out of patience and decided to apply for formal dismissal of the claim.

[15]         The application under Rule 9-5(1)(a) cannot succeed.  While it is now acknowledged that the claim has no merit, technically speaking, there is a cause of action framed and alleged as against CEVA alongside Great-West Life.  Hence, the application under Rule 9-5(1)(a) must be dismissed.

[16]         The alternative applications under Rule 9-7 and Rule 22-7(7) for summary trial and dismissal for want of prosecution, respectively, are properly brought and are properly framed.

[17]         It is not necessary for me to address the merits of the application under Rule 9-7.  The plaintiff has admitted, before me, that it has no proper cause of action against CEVA in any capacity as an insurer liable to pay benefits under the policy.  That is sufficient to dispose of the claim on the merits.

[18]         Insofar as want of prosecution is concerned, there is also a case for dismissal on that basis.  The test applied on such application is well known.  The court must consider the length of the delay and whether it was inordinate, which in this case is clearly established; any reasons for the delay, either offered in evidence or to be inferred from the evidence, including whether the delay was intentional and tactical or whether it was the product of dilatoriness, negligence, impecuniosity, illness or some other relevant cause, the ultimate consideration being whether the delay is excusable in the circumstances.

[19]         I have not been provided with evidence from the plaintiff explaining her delay.  I am not satisfied today the delay is excusable in the circumstances.

[20]         The next consideration is whether the delay has caused prejudice to the defendants in terms of presenting a defence, and if there is prejudice, whether it creates a substantial risk that a fair trial is not possible at the earliest date on which the action could be ready for trial.

[21]         Delay of such an excessive length often leads to an inference of prejudice, but I have not been provided with evidence substantiating prejudice or any risk that a fair trial would not be possible.

[22]         The fourth element is whether, on balance, the interests of justice require dismissal of the action.  This fourth question encompasses the other three factors and is the most important and decisive inquiry.

[23]         But for the matters that I am now about to address, I would have little hesitation in dismissing the action against CEVA, whether as a summary trial outcome or as an application for dismissal based on want of prosecution.

[24]         In response to the application the plaintiff amended her pleading pursuant to Rule 6-1(1)(a) without first securing leave.  Even though she admits before me that CEVA is not an insurer and is not liable on the contract of insurance, the amended pleading retains the earlier paragraphs asserting such liability against both defendants.  One has to query whether that amounts to an abuse of process in the circumstances, although it must be acknowledged it might simply have been oversight by counsel.

[25]         The substantive amendments to the pleading include an allegation that:

On or about September 2011, the defendant CEVA Freight Canada Ltd. wrongfully terminated the extended health benefit coverage available to the plaintiff without notice and without cause.

[26]         In Part 3, the legal basis of the claim has been amended to include:

At the time of her employment, it was an express and/or implied term of her employment that the plaintiff would receive extended health benefit coverage.  By its actions and failure to provide such coverage, the defendant CEVA has wrongfully terminated the plaintiff's extended health benefit coverage.

The syntax is poor, but the nature of the claim is obvious.  The problem is that the limitation period for this separate and discrete cause of action against the employer has expired.

[27]         Our Court of Appeal has held in a number of cases, including Allarcom v. Canwest Broadcasting Corp., [1988] B.C.J. No. 817, that the provisions of the "old" and the "new" Limitation Act (R.S.B.C. 1996, c. 266 (repealed) and S.B.C. 2012, c. 13), require leave of the court for any amendment alleging a fresh cause of action otherwise barred by lapse of time; to put it another way, in response to CEVA's application, the plaintiff should have filed her own application seeking leave to amend the pleading to raise the new cause of action, something that was not done.  The law is clear that the failure to obtain leave in such circumstances renders the amendment a nullity even though it was accepted for filing by the registry.

[28]         The question in these circumstances is whether I should, as CEVA requests, proceed on the basis that the amendment is a nullity and address its application on the merits as currently framed and in respect of which the plaintiff has tacitly admitted that she has no defence.  Or whether, as counsel for Ms. Brach submits, the court should defer ruling on the matter and allow the plaintiff to bring forward an application seeking leave to amend in the manner already filed, albeit improperly.

[29]         Neither counsel seems to be aware of the facts that might animate this new cause of action.  I am told it is a not uncommon practice for employers to terminate benefit entitlement of the sort referred to here when an employee is on an extended absence from work.

[30]         The "coverages" referred to here include reimbursement for prescription expenses, massage therapy, and the like, separate and apart from any entitlement to disability income benefits.

[31]         Counsel for CEVA acknowledges that his client may possibly have done something that would have resulted in a termination of entitlement to these additional health benefits, but because this issue has been sprung on him at the last moment in a desperate defence to the present application, he has not had the opportunity to inform himself in that regard.

[32]         Counsel for the plaintiff, however, advises that his client has been incurring substantial out-of-pocket expenses over the years for things such as prescriptions and massage therapy.  Those expenses would ordinarily be reimbursed through Great-West's health coverage plan but I am told such coverage has not, in fact, been available to her since September 2011, i.e., the period following the second anniversary of her departure from employment on purported medical leave.

[33]         So the legal issue is whether employees on what purports to be medical leave are entitled to a continuation of health benefit coverage at the instance of her employer, and whether the conduct of any employer that results in the termination of such benefits amounts to an actionable breach of the employment contract on the part of the employer.

[34]         It cannot be summarily determined today whether the cause of action alleged by the amended pleadings has merit, and it is possible that such a claim is available at law, depending on the nature of the employment contract.

[35]         If Ms. Brach is granted discretionary relief by the Court at this time, she should be obliged to bring forward an application seeking leave to amend her Notice of Civil Claim to allege a cause of action that has become statute-barred since the commencement of her original action.

[36]         The discretion to be exercised by a chambers judge in deciding whether to grant to leave to a plaintiff to amend a Notice of Civil Claim to plead such a cause of action requires consideration of several well-known factors; that is, the relative prejudice to the parties, the length of delay in seeking the amendment, and the defendant's explanation for delay.  There will usually be a presumption of prejudice in favour of the party opposing the amendments.

[37]         The discretion to grant the amendment after expiry of the limitation period, however, is to be exercised judicially in accordance with the evidence adduced, and which might address the extent of the delay, the reasons for the delay, any explanation put forward to account for the delay, and the extent of the connection if any between the existing claim and the proposed new cause of action: Amezcua v. Taylor, 2010 BCCA 128.

[38]         I am unimpressed by the manner in which the plaintiff has prosecuted her claim to date and the manner in which she has responded to this current application.

[39]         I am further unimpressed by the absence of any affidavit evidence from the plaintiff addressing the factors to be considered, whether in terms of the merits of the claim or in terms of the availability of dismissal for want of prosecution, which are similar to the factors that will be considered on any application to permit an amendment.

[40]         I am, however, going to grant the plaintiff one last indulgence.  I do so because of the allegation that she is suffering from a medical disability; and that she is out of pocket not only employment income, albeit reimbursed to some degree by way of disability benefits, but also significant expenses incurred for medical treatments.

[41]         The claim she is now attempting to frame against the employer is not necessarily without merit and depends upon evidence that has yet to be developed.  CEVA is a significant enterprise, and it does not point to any prejudice of the sort that might otherwise result in a dismissal, whether for want of prosecution or otherwise.

[42]         I am alert to CEVA's concerns about the manner in which this case has been handled and the expense and inconvenience to which it has been and is being put.  There will be a remedy for that by way of costs.

[43]         Accordingly, I adjourn CEVA's application sine die.  I grant the plaintiff liberty to bring forward an application for leave to amend the pleading in the manner already filed, provided such application is filed with supporting affidavit material, whether in support of amendment or in reply to the dismissal application already filed by CEVA, within 60 days of today's date.  If no such application is filed within that 60-day period, then the plaintiff's claim as against CEVA will stand dismissed with costs and without further order.

[44]         If the application is filed, I grant CEVA leave to file additional affidavit evidence as it deems necessary to respond to same.  I award the costs of today's attendance to CEVA in any event of the cause.

[45]         I conclude with the following observations.  It is incumbent upon Ms. Brach, if she wishes to pursue this additional claim against CEVA, to properly investigate the viability of same at law and on the facts of this case.  The amendment ought not be treated as a fishing expedition.  Either a proper cause of action exists or it does not.  A reading of the policy should disclose whether there is a basis for making any claim against Great-West Life for the benefits in question, and CEVA should disclose whatever documents it may have exchanged with Great-West Life that in any way altered or terminated Ms. Brach's ability to claim for continued health benefits beyond the first two years of her leave.

[46]         In this fashion, both parties can educate themselves whether there is at least an arguable case against CEVA for wrongful termination of entitlement, as it is currently framed, and the availability of such a cause of action and the potential merits of same can therefore be put in front of the judge before whom the application to amend is brought.  It will also provide an opportunity for counsel for the plaintiff to discuss with his client the merits of such action and whether it is appropriate to call it quits as against CEVA rather than continuing pursuit of a claim that may be dismissed on a summary basis and that, in turn, may give rise to an award of costs on something other than the ordinary scale.

[47]         Is there anything further?

[48]         MR. RANDHAWA:  No, My Lord.  Thank you very much.

[49]         MR. SCHALKE:  No, My Lord.

[50]         MR. RANDHAWA:  My apologies, My Lord.  Just an afterthought.  I am assuming your comments are that CEVA will provide us with a list of documents.

[51]         THE COURT:  It may not necessarily be a list of documents, but I think CEVA has to do something.  The communications in question are clearly something outside the power or possession of the plaintiff.  She should be provided whatever would be necessary to inform the analysis.

[52]         MR. RANDHAWA:  Thank you, Your Honour.

[53]         MR. SCHALKE:  Understood.  Thank you, Your Honour.

"KENT J."