Simon's Megalomaniacal Legal Resources

Shipping - Marine Liability Act

. Algra v. Comrie Estate

In Algra v. Comrie Estate (Ont CA, 2023) the Court of Appeal considered law emanating from a fatal boat accident, here aspects of the federal Marine Liability Act:

(ii) MLA Appeal

[35] The issue on this appeal is a narrow one: Did the motion judge err in law when he found that the cap imposed in s. 29 of the MLA does not include claims for costs and interest? Section 29 of the MLA that was in force at the time states:

The maximum liability for maritime claims that arise on any distinct occasion involving a ship of less than 300 gross tonnage, other than claims referred to in section 28, is

(a) $1,000,000 in respect of claims for loss of life or personal injury; and

(b) $500,000 in respect of any other claims.

[36] In his reasons, the motion judge cited the often quoted statement of Elmer Driedger in Construction of Statutes, 2nd ed. (Toronto: Butterworths, 1983), at p. 87, “Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.” He went on to consider the words of the statute in the context of the particular provision:

The words are, “The maximum liability for maritime claims ... is ... $1,000,000 in respect of claims for loss of life or personal injury ….”

These simple words must be read together and not interpreted by focusing only on one clause or on another. The maritime claims specifically are identified: claims for loss of life or personal injury. Thus, the “maximum liability” statutory cap is for claims for loss of life or personal injury.

In my view, a claim for costs and a claim for prejudgment interest each serve a different purpose and seek to protect a different interest than a claim for loss of life or personal injury.

[37] The motion judge then considered jurisprudence regarding costs and prejudgment interest, observing that the role of costs is to ensure that litigation is conducted in an efficient, fair, and just manner, while the role of prejudgment interest is to account for the delay between injury and judgment. He concluded his analysis as follows:

In my view, the contextual reading of the words of the statute together with an understanding of the function and purposes of costs and interest resolve the interpretation issue. By their very nature and function, claims for costs and interest clearly are not claims for loss of life or personal injury. As I have stated, they each have a different objective and serve to protect different interests. As such, inclusion of costs and interest into the liability limitation of s.29(a) of the MLA is an incorrect interpretation of it.

[38] The motion judge’s analysis was correct. The legislation was silent on whether costs or interest were included under the cap. Parliament was explicit that the cap applied only to “claims for loss of life or personal injury.” The ordinary meaning of a legislative provision is deemed to be the meaning intended by the legislature, unless compelling reasons exist to justify a departure from the ordinary meaning: Ruth Sullivan, The Construction of Statutes, 7th ed. (Toronto: LexisNexis Canada, 2023), at § 3.01; Rizzo & Rizzo Shoes Ltd. (Re), 1998 CanLII 837 (SCC), [1998] 1 S.C.R. 27, at para. 21. Claims for interest and costs are of a different nature than claims for loss of life or personal injury. If Parliament wanted to restrict those claims, it could have done so with explicit language. Such a restriction would be extraordinary because it would interfere with the ability of courts – grounded in provincial legislation – to control the litigation process through two of their most effective tools.

[39] Costs and, to a lesser extent, prejudgment interest, are discretionary tools, which can be used by trial judges to ensure timely and substantive access to justice. To accede to the interpretation of s. 29 of the MLA argued by the Estates would inhibit trial judges from controlling the process in their courts. For example, the ability to sanction a party for deliberately delaying a proceeding by ordering a significant costs award would effectively be lost because the sum awarded would simply be applied to the cap. This could also have a chilling effect on potential plaintiffs considering the advisability of launching a claim. If most of a potential recovery will be eaten up by costs, there is little incentive to commence an action. This means that a fundamental policy goal of the tort law – punishing tortfeasors for their wrongful conduct and preventing a repeat of such conduct in the future – would be defeated.

. Koch v. Borgatti Estate

In Koch v. Borgatti Estate (Fed CA, 2022) the Federal Court of Appeal heard an appeal from a federal declaration case which was brought in support of an existing Ontario boat accident litigation case, attempting to reduce defendants' liability by virtue of the Marine Liability Act:

[2] The circumstances giving rise to the motions and resulting orders are tragic. Two boats collided on Stoney Lake, in Ontario, on August 24, 2019. One was operated by the appellant, Kevin Koch, and the other by Richard Neil Borgatti. Regrettably, Mr. Borgatti and one of his passengers, Kristian Brudek, died as a result of the accident. Four others were injured, including Mr. Koch and Mr. de la Guardia, one of Mr. Koch’s passengers.

[3] Litigation in the Ontario Superior Court of Justice ensued against Mr. Borgatti’s estate and against Mr. Koch and his father David Koch, owner of the boat Mr. Koch operated.

[4] Subsequently, the Kochs brought an action in the Federal Court (Court File T‑198‑21) seeking a declaration that their liability be limited to $1,000,000 pursuant to the Marine Liability Act, S.C. 2001, c. 6 (the Koch limitation action). ...