2005 BCSC 70 Yuen v. Onni et al

Before: Master Scarth

Reasons for Judgment

Counsel for the Plaintiffs:	S. L. Boothman
Counsel for Third Party, the City of Richmond:	D. C. Russell
Date and Place of Hearing:	September 17 and October 4, 2004
	Vancouver, B.C.

[1] Ms. Yuen applies for an order pursuant to Rule 15(5)(a)(iii) adding the City of Richmond (the “City”) to this action as a defendant and amending the statement of claim accordingly. The City opposes its joinder. The existing defendants take no position on the application.

Background

[2] Ms. Yuen and the defendant Onni Development (Firbridge) Corp. (“Onni”) own property adjacent to each other in Richmond. There is a commercial building on Ms. Yuen’s property. In September, 2001, construction began on a building project on Onni’s property.

[3] On November 19, 2001 Ms. Yuen wrote to Onni complaining about damage to her building arising out of the activities at the Onni construction site. Ms. Yuen copied her letter to Gavin Woo, Building Inspections, City of Richmond. On December 4, 2001 Ms. Yuen received an expert’s opinion as to the cause of the damage to her building. Repairs were done to her building including work on the roof and foundation for which the City issued building permits.

[4] On December 18, 2001, Ms. Yuen’s lawyer, Darrell Burns, wrote to the City as follows:

We are the solicitors for Mrs. Jane Yuen.

Mrs. Yuen is the owner of the property and commercial building at 5960 Minoru Boulevard, Richmond, B.C. We refer to Mrs. Yuen’s earlier correspondence regarding the project of ONNI Development (Firbridge) Corp. at 7831 Westminster Highway, Richmond, B.C.

ONNI’s construction activities have caused damage to Mrs. Yuen’s property.

At this time, the damage is worsening and poses a potential danger to the structural safety of Mrs. Yuen’s building and the safety of her tenants and invitees.

The City ought not to permit ONNI Development (Firbridge) Corp. to continue with its construction activities unless and until adequate arrangements are made to remedy the damages already caused and to avoid further damage to Mrs. Yuen’s property.

May we please know what your intentions are as soon as possible.

[5] The reply letter from the City is dated December 21, 2001. Paul Kendrick, City Solicitor, writes:

...

Your earlier correspondence was forwarded to Onni Development for their information and action. Since then, the Building Approvals Department has contacted with your structural engineer, Mr. Patrick Lam, P.Eng., who evaluated the structural condition of Mrs. Yuen’s building. He indicated that there was no immediate danger in the structural safety of the building. This concern was also brought to the attention of Mr. Kevin Brennan, Vice President, Construction of the Onni Group, who indicated that the preload on his property was complete and he was now in the process of removing it.

Mrs. Yuen was previously advised that the activities at 7831 Westminster Highway did not require a Building Permit and her structural engineer’s evaluation indicated no immediate structural danger in the building. The Building Approvals Department does not have any jurisdiction between Mrs. Yuen and Onni Development. This is a civil matter between the two parties.

...

[6] Apparently there was no further correspondence between Ms. Yuen or her counsel and the City at that time.

[7] On October 14, 2003, Ms. Yuen commenced this action against Onni and others in negligence, trespass and nuisance. Onni filed its statement of defence on January 21, 2004. Its defence includes allegations of negligence against the City based on the City’s review and approval of the preload plans (referred to in the statement of defence, along with the stone column plans, as the “Geopacific Protocol”) as part of the building permit application process. It also refers to Ms. Yuen’s complaints to the City and states (at paragraph 14):

...in response to the Plaintiff’s complaints, the City attended at the Construction Site to inspect and examine the implementation of the Geopacific Protocol. Onni further states that, at this attendance, the City did not direct that the site preparation implemented by the Geopacific Protocol be ceased or altered in any way, or at all.

[8] Onni filed its third party notice against the City and Geopacific Consultants Ltd. on May 31, 2004. In addition to repeating the allegations in the statement of defence, Onni specifically names the City representative, Gavin Woo, who, it alleges, attended at the Onni site following Ms. Yuen’s complaints.

[9] In support of her application to add the City, Ms. Yuen deposes that, until she read the allegations against the City in the Onni statement of defence, “she did not know that the City had attended at the construction site to do anything as a result of my complaints.”

[10] A notice of motion was served on April 20, 2004 seeking to substitute the City for “ABC Co.#3”. Ms. Yuen’s counsel, Shelley Braun, deposes that between January 26, 2004 when Onni’s statement of defence was delivered, and April 20, 2004, she was meeting with Ms. Yuen to obtain instructions and preparing the application.

[11] A second notice of motion was prepared dated June 2, 2004 seeking to add the City as a defendant. A third notice of motion (“Further Amended Notice of Motion”) followed dated August 11, 2004. Yet another notice of motion, entitled “Second Further Amended Notice of Motion” followed, dated August 17, 2004. It is this last motion upon which this application is based. It is worth noting at this point that the Rules do not provide for an amended notice of motion, let alone a further amended notice of motion.

[12] The proposed amendments attached to the last notice of motion are, Ms. Yuen concedes, copied from the Onni pleadings. They are framed in negligence and allege a duty on the part of the City to conduct its inspection of the preload adequately and properly, a breach of that duty and corresponding damages to Ms. Yuen which were foreseeable.

Law

[13] Rule 15(5)(iii) provides that:

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.

[14] The order is a discretionary one. The test to be applied has recently been confirmed by the Court of Appeal in Strata Plan LMS 1816 v. Acastina Investments Ltd. 2004 BCCA 578, a decision released since the hearing of this application. The court stated, at para. 3:

The test for joinder under subrule (5)(a)(iii) has two branches. The court must be satisfied: (1) that there is a question or issue between the parties relating to the relief, remedy, or subject matter of the suit; and (2) it is just and convenient to determine the issue in the proceedings in question.

[15] As to the first branch, the City does not dispute that the proposed amendments disclose a cause of action, but submits that the onus on the plaintiff to establish that there is a real issue to be determined between the plaintiff and the City can only be discharged by affidavit evidence. Any controversy on this point has been laid to rest by the Court of Appeal in Acastina, supra. On the issue of whether the determination on the first branch of the test can be made on the pleadings alone, without evidence, the court held that evidence is not required for joinder where the material facts as pleaded establish a real issue between the parties: at para. 14. It is sufficient therefore that the proposed amendments allege facts which, if assumed to be true and provable, would establish a cause of action: Traff v. Evanic, [1997] B.C.J. No. 1469 (S.C.) (Q.L.).

[16] I am satisfied that the proposed amendments satisfy the first branch of the test under Rule 15(5)(a)(iii).

[17] The issue on this application is therefore limited to the second branch of the test which requires the court to determine, in its discretion, whether it is just and convenient to add the proposed defendant in light of all the circumstances.

[18] Relevant factors on the second branch include the length of the delay, the reasons for the delay, the degree of prejudice caused by the delay and the extent of the connection between the existing claims and the proposed new cause of action: Teal Cedar Products (1977) Ltd. v. Dale Intermediaries Ltd. (1996), 19 B.C.L.R. (3d) 282 (C.A.); Letvad v. Fenwick (2000), 82 B.C.L.R. (3d) 296 (C.A.).

[19] The expiry of a limitation period is not a bar to adding a new party as defendant but is a factor to be considered in determining whether it is just and convenient to add a proposed defendant: s. 4(1), Limitation Act, R.S.B.C. 1996, c. 266; Lui v. West Granville Manor Ltd. et al. (1987), 11 B.C.L.R. (2d) 273, at p. 301 (C.A.). The City does not rely on the limitation period set out in s. 285 of the Local Government Act, R.S.B.C. 1996, c. 323 but submits that there is an accrued limitation defence pursuant to the Limitation Act, the applicable limitation period being two years. The plaintiff submits that a proper application of s. 6(4) of the Limitation Act would result in a finding that the limitation period has not expired.

[20] An adjudication of the limitation issue is beyond the scope of this interlocutory application, as it would require a thorough review of the evidence regarding the knowledge, or means of knowledge, of the plaintiff regarding the damage to her property and the involvement of the City. In my view, it is appropriate to proceed on the assumption that the limitation period has expired and determine whether it is just and convenient to add the City nevertheless: Strata Plan LMS 1463 v. Krahn Bros. Construction Ltd.(2004), 25 B.C.L.R. 4^th 203, 2004 BCCA 190; Brito v. Woolley (1997), 15 C.P.C. (4^th) 255 (S.C.); see also Strata Plan LMS 2262 v. Stoneman Developments Ltd. 2004 BCSC 828; Strata Plan VR 2402 v. R. 118 Developments Inc. et al. (2004), 35 C.L.R. (3d) 20, 2004 BCSC 903.

[21] I turn to a consideration of the factors set out in paragraph 18 above, beginning with delay.

[22] The City submits that the court should consider the delay between the occurrence of the damage to the plaintiff’s property and the application to add the City. It is clear from the decisions in this area, however, that the relevant delay is that between the expiry of the limitation period and the application to add the proposed defendant. See, for example, Strata Plan LMS 1463 v. Krahn Bros. Construction Ltd. 2003 BCSC 903, at para. 44; upheld on appeal, supra.

[23] Assuming, as the City submits, that the two-year limitation period began to run in December, 2001 at the latest, it expired in December, 2003. The length of the delay between the expiry of the limitation period and this application – December, 2003 to August, 2004 - is therefore eight months. At the hearing of this application, the City did not take issue with the delay from January to April, 2004, when the first motion was served, nor with the delay until August in settling the form of the notice of motion. This has the effect of reducing the relevant delay to at most two months – clearly not a significant delay.

[24] The court has held that such delay does not require explanation as it falls within the combined three year period to which a plaintiff is entitled under the Limitation Act and the Rules of Court for commencing an action and serving the writ: Yablonski v. Corp. of City of Cranbrook 2002 BCSC 1875 at para. 39, citing Kean v. Blue Boy Motor Hotel [1988] BCJ No. 1653 (S.C.)(Q.L.).

[25] The explanation offered by the plaintiff is that she was unaware until January, 2004 of the City’s attendance at the Onni site in response to her complaints.

[26] On the issue of prejudice, the City cites the presumed prejudice arising from the loss of the limitation defence. It also submits that its addition as a defendant exposes the City to litigation risks and defence costs far greater than those to which it is exposed as a third party. Further it submits that, as a potential “deep pocket”, it may face contributing to a settlement or award in greater proportion than its role truly deserves. In my view, neither the potential defence costs nor the risk of a disproportionate contribution to settlement amounts to actual prejudice for purposes of the analysis under the second branch of the test.

[27] In assessing the prejudice to the City, I note that the City had knowledge of the Onni project as, on its own submission, it is involved in virtually all building projects within its jurisdiction. Further, the City was aware of Ms. Yuen’s complaints that the project was causing damage to her property from the time that damage allegedly occurred. The City apparently conducted some investigation of Ms. Yuen’s complaints in late 2001 and subsequently issued building permits for the repair work done to her building. There is no suggestion that documents relating to the City’s involvement with the project or with Ms. Yuen have been destroyed or that witnesses are no longer available.

[28] I am unable to conclude that the City will suffer prejudice beyond that arising from the loss of its limitation defence. The court has held that this prejudice does not usually outweigh the prejudice to a plaintiff resulting from the loss of a cause of action: Takenaka v. Stanley (2000), 91 B.C.L.R. (3d) 179; 2000 BCSC 242.

[29] I am satisfied that there is a significant connection between the existing claim and the proposed new cause of action which both arise from the Onni project. It is also relevant that the City is already involved in this action as a third party.

[30] Having weighed all of these factors, I conclude that it is just and convenient to allow Ms. Yuen’s application to add the City to this action. The style of proceedings may be amended accordingly and the statement of claim amended as attached to the notice of motion dated August 17, 2004.

[31] The City sought as a term of any order adding it to the actions that it be allowed to argue its limitation defence at trial. Such a term would not be appropriate given that I have concluded that it is just and convenient to add the City on the assumption that the limitation period has expired: Strata Plan LMS 1463, supra.

[32] Costs will be in the cause.

“Master S. Scarth”

Citation:	*Yuen v. Onni et al,*
	2005 BCSC 70