Editors --- "Blackwater v Plint, 2005 SCC 58 - Case Summary" [2005] AUIndigLawRpr 68; (2005) 9(4) Australian Indigenous Law Reporter 40
BLACKWATER v PLINT
Supreme Court of Canada (McLachlin CJ and Major, Bastarache, Binnie, LeBel, Deschamps, Fish, Abella and Charron JJ)
21 October 2005
Torts — vicarious liability — negligence — fiduciary duty — non-delegable duty — apportionment of damages where two employers simultaneously vicariously liable — whether church entitled to charitable immunity — effect of prior abuse on damages awarded to victim of sexual abuse
Facts:
Twenty-seven former residents of the Alberni Indian Residential School (‘AIRS’) commenced four actions in 1996 claiming damages for sexual abuse and other harm. The children had been taken from their families pursuant to the Indian Act, SC 1951, c 29, and sent to AIRS, which had been established by the predecessor of the United Church of Canada (‘the Church’).
At first instance it was found that all claims other than those of a sexual nature were statute-barred. The trial judge held the respondent, who at the time in question was a dormitory supervisor at AIRS, liable for sexual assault against six plaintiffs. The Government of Canada and the Church were found to be jointly and vicariously liable for the sexual assaults on the basis of breach of a non-delegable statutory duty, and fault was apportioned on the basis of 75% on the part of Canada and 25% on the part of the Church. The trial judge determined that neither Canada nor the Church was negligent or in breach of fiduciary duty.
All parties appealed to the British Columbia Court of Appeal, which held that the Church was protected from liability by the doctrine of charitable immunity. The Court of Appeal found that all fault should be apportioned to Canada.
Canada appealed against the Court of Appeal’s finding that the Church was entitled to charitable immunity. Canada also appealed against the finding that it had breached a non-delegable statutory duty. The plaintiffs’ cross-appeal related to the decision of the Court of the Appeal that an action for negligence and breach of fiduciary duty on the part of Canada and the Church had not been made out. The plaintiff also appealed on the basis that, in its assessment of damages, the Court of Appeal did not take into account harm other than that relating to the sexual assaults.
Held, dismissing the Plaintiff’s appeal and allowing Canada’s appeal in part:
1. The Court of Appeal erred in its exemption of the Church from liability on the ground of charitable immunity. The principle of risk allocation applies only where an enterprise is more able to bear a loss than a victim, and should not be extended to mean that the party best able to bear the loss should be liable if this party bears more responsibility than the party less able to pay: [40]–[44]. Bazley and Jacobi v Griffiths [1999] 2 SCR 570 distinguished.
2. The plaintiff did not establish constructive knowledge of a foreseeable risk of sexual assault to the children. The trial judge was therefore correct to hold that negligence was not proved against either Canada or the Church. Similarly, the plaintiff did not establish a basis for the finding of a breach of fiduciary duty: [16]–[17], [63].
3. A non-delegable statutory duty on the part of Canada cannot be inferred from the wording of the Indian Act, SC 1951, ss 113 and 114. The argument that a general obligation was incurred by a system of residential schools that robbed Indian children of their communities, culture and support and placed them in environments of abuse goes beyond the words of the statute and is not persuasive: [47], [50], [61]–[62].
4. The trial judge was correct to confine damages to the sexual assaults, which were the only harms that arose from actionable torts. To permit the award of damages for wrongful acts subject to expired limitation periods would reverse legislative intent and go beyond the role afforded to the judiciary: [82]–[87].
5. Vicarious liability in relation to the actions of the AIRS employee may be imposed on the Church because the Church exerted such control over the AIRS operations which gave rise to the wrong that the Church could be considered to be the employer. Vicarious liability exists jointly between Canada and the Church as a partnership existed between the two: [21]–[37].
6. Unequal apportionment of responsibility is feasible and, in these circumstances, appropriate. Canada was the more senior party in its partnership with the Church and was in a better position than the Church to supervise the situation at AIRS and prevent the harm. The calculations of the trial judge were correct and damages should be apportioned 75% on the part of Canada and 25% on the part of the Church: [65], [73].
Case Extract
McLachlin CJ
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Vicarious Liability
18. The trial judge accepted that the Church and Canada were vicariously liable for the wrongful acts of the dormitory supervisor, Plint. The Court of Appeal disagreed. While it upheld the trial judge’s finding that Canada was vicariously liable because of its control over the principal and activities at AIRS, the court held that the Church’s non-profit status exempted it from any liability.
19. I conclude that the trial judge was correct in concluding that both the Church and Canada are vicariously liable for the wrongful acts of Plint.
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32. The Court of Appeal, in rejecting the Church’s vicarious liability, relied on Canada’s degree of control over AIRS, the Church’s specific mandate to promote Christian education, and the difficulty of holding two defendants – Canada and the Church – vicariously liable for the same wrong. I conclude that none of these considerations negate the imposition of vicarious liability on the Church.
The Doctrine of Charitable Immunity
39. The Court of Appeal went on to find that in any event the Church would be exempted from any liability on the basis of the doctrine of charitable immunity …
40. This conclusion rests on a misapprehension of the principles governing vicarious liability and more particularly, the decisions of this Court in Bazley and Jacobi v Griffiths, [1999] 2 SCR 570. It seeks to ground itself in the discussion in Bazley of risk allocation, namely the argument that as between the enterprise that introduces the risk which produces the harm and the victim, it may be fair to require the enterprise to bear the loss, provided there is a sufficient connection between the enterprise and the harm. The Court of Appeal then extends this observation to reason that it is the party best able to bear the loss that should be liable, provided it bears more responsibility than a party less able to pay. Reasoning that the government of Canada is more at fault and better able to bear the loss than the Church, a non-profit organization, it concludes that the Church should not be liable and that Canada alone should bear the loss. The result is to convert a policy observation in Bazley into a free-standing legal test that dictates that non-profit organizations should be free from liability for wrongs committed by their employees, provided they are less at fault than a party better able to bear the loss.
41. This class-based exemption finds support neither in principle nor in the jurisprudence. It ignores the other concerns raised in Bazley that led the Court to reject a class-based exemption from vicarious liability. First, exempting non-profit organizations when government is present would not motivate such organizations to take precautions to screen their employees and protect children from sexual abuse. The presence of government does not guarantee the safety of children, particularly where, as in this case, the non-profit organization has day-to-day management of the institution.
42. Second, the Church in this case was not working with volunteers and in fact was running a residential school with employees. Thus, arguments that it was less able to supervise its employees’ actions are inapplicable; the Church clearly supervised its employees’ work and actions and arguably was best placed to do so. The Church enhanced the risk it had introduced by placing Mr Barney in the care of Plint, whose activities the Church managed.
43. The proposed charitable exemption is problematic on yet other grounds. It raises the difficulty that a host of organizations may claim to be non-profit, some of which the law might not wish to favour with an exemption. Indeed, the government itself may be considered a non-profit institution. And it suggests, contrary to legal principle, that lesser responsibility should be converted to no liability, violating the precept that the judge-made common law must proceed incrementally: R v Salituro, [1991] 3 SCR 654 at 666.
44. One may sympathize with the situation of the Church, which generally acts with laudable motives and now finds itself facing large claims for wrongs committed in its institutions many years ago. However, sympathy does not permit courts to grant exemptions from liability imposed by settled legal principle. I conclude that the Court of Appeal erred in exempting the Church from liability on the ground of charitable immunity.
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Non-delegable duty
50. The text of ss 113 and 114 [Indian Act, SC 1951] does not support the inference of a mandatory non-delegable duty. First, it uses the permissive term ‘may’, as opposed to the directive term ‘shall’, limiting the possibility of finding an obligation as strong as a duty. Second, the power of the government to enter into agreements with religious organizations for the care and education of Indian children suggests that the duty is eminently delegable and was contracted out of by the government. There is no language in the statute that replicates the clear language found in Lewis (Guardian ad litem of) v British Columbia1997 CanLII 304 (SCC); , [1997] 3 SCR 1145, where a non-delegable duty was found …
51. The Church raises a number of arguments in response. First, it argues that the pervasive control granted by Parliament over every aspect of Indians’ lives, including their definition and registration, jurisdiction over reserves and jurisdiction over mentally incompetent Indians, justifies finding a non-delegable statutory duty. However, arguments based on general obligations outside the strict language of the statute and the residential school setting are not persuasive. They risk encroaching on other grounds of liability such as breach of fiduciary duty and negligence. Unless a non-delegable statutory duty is based on the language of the statute, the boundaries between the various grounds of liability become meaningless.
52. Second, the Church argues that the regulations enacted by the government pursuant to Indian Act, SC 1951 s 114(a) required the principal of AIRS to maintain standards acceptable to the Superintendent of Indian Affairs for Canada with respect to all aspects of the students’ life at AIRS, including safety, counselling, guidance, and home and school relationships. In addition, the regulations mandated that ‘[e]very school shall be subject to inspection by such officials of the Government of Canada and by such other persons as the Superintendent may authorize.’: (Indian Residential School Regulations, 1953, Reg 14). These and other regulations granted Canada the power to set standards for the operation of the school and inspect to see that these standards were met. But they fall short of establishing a mandatory non-delegable duty to ensure the students’ safety and welfare. Indeed, they seem to presuppose delegation of Canada’s duties.
53. Third, the Church argues that by forcing Aboriginal children to attend designated residential schools that maintained total control over those children [Indian Act, SC 1951 ss 115 and 117], Canada acquired a duty to protect the interests of those children. While emotionally compelling, this argument too falls short of establishing a non-delegable statutory duty at law.
54. Taken together, the statutory language of these provisions falls short of imposing the broad statutory duty of care to protect the safety and welfare of the children.
55. I conclude that the trial judge erred in finding a non-delegable statutory duty on Canada in this case.
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Damages: the Effect of Prior Abuse
78. It is important to distinguish between causation as the source of the loss and the rules of damage assessment in tort. The rules of causation consider generally whether ‘but for’ the defendant’s acts, the plaintiff’s damages would have been incurred on a balance of probabilities. Even though there may be several tortious and non-tortious causes of injury, so long as the defendant’s act is a cause of the plaintiff’s damage, the defendant is fully liable for that damage. The rules of damages then consider what the original position of the plaintiff would have been. The governing principle is that the defendant need not put the plaintiff in a better position than his original position and should not compensate the plaintiff for any damages he would have suffered anyway: Athey v Leonati, [1996] 3 SCR 458. Mr. Barney’s submissions that injury from traumas other than the sexual assault should not be excluded amount to the contention that once a tortious act has been found to be a material cause of injury, the defendant becomes liable for all damages complained of after, whether or not the defendant was responsible for those damages.
79. At the same time, the defendant takes his victim as he finds him – the thin skull rule. Here the victim suffered trauma before coming to AIRS. The question then becomes: what was the effect of the sexual assault on him, in his already damaged condition? The damages are damages caused by the sexual assaults, not the prior condition. However, it is necessary to consider the prior condition to determine what loss was caused by the assaults. Therefore, to the extent that the evidence shows that the effect of the sexual assaults would have been greater because of his pre-existing injury, that pre-existing condition can be taken into account in assessing damages.
80. Where a second wrongful act or contributory negligence of the plaintiff occurs after or along with the first wrongful act, yet another scenario, sometimes called the ‘crumbling skull’ scenario, may arise. Each tortfeasor is entitled to have the consequences of the acts of the other tortfeasor taken into account. The defendant must compensate for the damages it actually caused but need not compensate for the debilitating effects of the other wrongful act that would have occurred anyway. This means that the damages of the tortfeasor may be reduced by reason of other contributing causes: Athey v Leonati, [1996] 3 SCR 458 [32]–[36].
81. All these scenarios flow from the basic principle that damages must seek to put the plaintiff in the position he or she would have been in but for the tort for which the defendant is liable.
82. The trial judge correctly apprehended the applicable legal principles. He recognized the ‘daunting task’ of untangling multiple interlocking factors and confining damages to only those arising from the actionable torts, the sexual assaults…He tried his best to award fair damages, taking all this into account. He recognized the thin skull principle, but in the absence of evidence that Mr. Barney’s family difficulties prior to coming to AIRS had exacerbated the damage he suffered from the sexual assaults he sustained at AIRS, the trial judge had no choice but to attempt to isolate those traumas. Similarly, there was no legal basis upon which he could allow damages suffered as a result of statute-barred wrongs committed at AIRS, like the beatings, to increase the award of damages.
83. More broadly, Mr. Barney relies on the maxim that none should profit from his own wrong, ex turpi causa non oritur actio, to argue that the respondents should not be enriched by their improper care of him. He argues that reducing his damages award because of the harm caused by placing Aboriginal children in residential schools allows the Church and Canada to profit from their own immoral and illegal conduct.
84. This argument cannot succeed, notwithstanding its instinctive appeal. First, it is not correct to view the respondents’ case as an attempt to profit from immoral and illegal conduct by reducing damages. The amount of damages is limited by loss caused by the actionable torts, in this case sexual assault. Not awarding damages for loss caused by other factors does not ‘reduce’ damages. On the contrary, to award damages for such loss would be to ‘increase’ them beyond what the law allows. Thus it cannot be said that the respondents are profiting from their wrong.
85. Second, the maxim ex turpi causa non oritur actio cannot be applied to evade legal limits or undermine the legal system. Applying it to permit damages to be awarded for wrongful acts that are subject to limitation periods that have expired would subvert the legislation and compensate for torts that have been alleged but not proven. It would be to override legislative intent and fix liability in the absence of legal proof.
86. Third, even if these difficulties could be overcome, ex turpi causa non oritur actio should be applied cautiously, where it is clearly mandated: Hall v Hebert, [1993] 2 SCR 159. Compensation for the impact of attending residential schools is fraught with controversy and difficulty. Here, as for the broad claim for collective breach of fiduciary duty, the necessary record to permit consideration of past policy wrongs is lacking.
87. I conclude that Mr. Barney’s contention that the trial judge erred in failing to properly consider wrongs other than the actionable sexual assaults in assessing damages cannot succeed.
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Related cases and an examination of the Canadian Government’s November 2005 Agreement in Principle: Indian Residential Schools will be published in the next edition of the AILR.