Housewise Construction Ltd. v. Whitgift Holdings Ltd.,
2016 BCSC 2245
On judicial review from: An order of the Provincial Court of British Columbia, dated August 19, 2015 (Housewise Construction Ltd. dba Segal Disposal v. Whitgift Holdings Ltd., 2015 BCPC 297)
Reasons for Judgment
Counsel for the Petitioner: C.M. Lo
Counsel for the Respondent: I.S. Petersen
INTRODUCTION
[1] The petitioner seeks a judicial review of a decision of the Provincial Court of British Columbia dismissing its Small Claims action against the respondent following a pre-trial application.
[2] The Provincial Court judge found that the corporate claimant (now the petitioner) was not a party to the contract on which the claim was based and dismissed the claim as one that disclosed no triable issue.
[3] The petitioner does not dispute the finding that its claim in contract could not succeed, but says the application judge erred in law by not allowing the matter to proceed to trial on the basis of an alternative claim for unjust enrichment.
THE PROVINCIAL COURT PROCEEDINGS
[4] The petitioner filed its notice of claim in the Provincial Court on
October 5, 2012 alleging that it had entered into a contract with the respondent to provide waste disposal and recycling services. It alleged that it was owed $26,409 in unpaid bills for the months of March, April, May and June 2012, as well as $47,380 in liquidated damages. However, the notice of claim said the petitioner was waiving its claim to any amount in excess of $25,000 — the limit of the Provincial Court’s jurisdiction under the Small Claims Act, R.S.B.C. 1996, c. 430(“SCA”).
[5] The respondent filed a reply and counterclaim, alleging fundamental breach of the contract, on October 23, 2012.
[6] On April 12, 2013, the petitioner filed a trial statement as required by the Small Claims Rules, B.C. Reg. 261/93 (“SCR”). Copies of documents included with the trial statement included the contract and invoices relied upon. On April 26, 2013, the petitioner filed an amended notice of claim, eliminating a reference to settlement discussions that appeared in the original notice of claim.
[7] A trial was set for August 6, 2014, but was adjourned on application of the respondent. When the matter came on for trial again on February 24, 2015, the respondent again applied for and was granted an adjournment. The order adjourning the trial also gave the respondent leave to file an amended reply no later than March 31, 2015 and said the claimant could file an amended notice of claim within 14 days of receiving the amended reply.
[8] The respondent filed its amended reply on March 23, 2015 and for the first time raised a defence that the petitioner was not a party to the contract. The basis for that defence was that although the named claimant was “Housewise Construction Ltd. dba Segal Disposal”, the claimant’s printed contract form and invoices referred only to “Segal Disposal” with no indication that a corporation was involved. The claimant never filed an amended notice of claim.
[9] On June 26, 2015, the respondent filed an application for dismissal on the grounds that there was no contract between the parties and that the petitioner lacked standing to claim for breach of contract.
[10] The application was heard on August 10, 2015, with the petitioner’s representative appearing in person and the respondent represented by counsel. The application judge gave a written ruling on August 19, 2015.
[11] The application judge referred to s. 27 of the Business Corporations Act, S.B.C. 2002, c. 57 which requires a company to display its name when conducting business, including on all contracts and invoices. The application judge said at para. 16:
[16] Based upon the uncontroverted evidence and submissions at this stage, it is abundantly clear that there was no reason for Whitgift to believe they were doing business or contracting with Housewise Construction. The Customer Service Agreements are in the name of Segal Disposal. The one invoice presented to the court was made out by Segal and Whitgift wrote a cheque cashed by Segal in reliance of that invoice. Other documentation only adds, in small letters, the words “Housewise Construction Ltd. dba…” There would be no basis upon which a trial court could find Whitgift would have thought it was dealing with a corporation with limited liability. There is also no evidence to suggest that the parties entered into a new agreement with Housewise or that they agreed Housewise had taken over the Segal Disposal contract.
[12] The application judge said at para. 17 the claimant had known for almost five months that the respondent was raising an issue of privity of contract, but had done nothing to amend its notice of claim to address that issue.
[13] The judge also noted at para. 17 that the claimant was not an unsophisticated or inexperienced litigant in Small Claims Court, having commenced 135 actions in that court over a five year period. (The specific number mentioned by the application judge appears to be based on a finding by an adjudicator in an earlier case — Housewise Construction Ltd. v. Nguyen, [2015] B.C.J. 1185. However, records of the Provincial Court put into evidence by the respondent on this petition confirm that the petitioner is a frequent claimant in Provincial Court. They list more than 130 Small Claims actions commenced between July 2010 and February 2015.)
[14] Having concluded that the claim in contract raised no triable issue, the application judge determined that it would not be appropriate to allow the case to go forward “on the remote chance of success on an alternate claim for unjust enrichment”: at para. 19.
ERRORS ALLEGED BY THE PETITIONER
[15] In its petition and in argument, the petitioner relies heavily on the application judge’s reference to a “remote chance of success”: at para. 19. The petitioner argues that if there was a remote chance of success — as opposed to no chance — it was an error in law to dismiss the case before trial.
[16] In argument, counsel for the petitioner also alleged errors of fact and a reasonable apprehension of bias on the part of the application judge.
[17] As I understand the bias allegation, it arises from the application judge’s reference to the decision of the adjudicator in Housewise Construction Ltd. v. Nguyen, and the fact that this Court subsequently allowed an appeal in that case on the basis of a reasonable apprehension of bias in Housewise Construction Ltd. v. Yen Thi Nguyen (24 September 2015), Vancouver S154301 (B.C.S.C.).
[18] However, this Court’s decision allowing that appeal was not made until about a month after the application judge’s decision. In any event, I have not considered the bias allegation because it was not referred to in the petition and the respondent had no notice of it.
[19] The alleged factual errors were also not mentioned in the petition and I have not considered them. I also note that the alleged errors, with one exception, appear to be alleged misunderstandings by the application judge of submissions made by the petitioner’s representative. I do not consider submissions to be “facts” within the meaning of the court’s jurisdiction to review for errors of fact.
[20] The judicial review jurisdiction invoked by the petitioner is contained in the jurisdiction to correct an “error of law on the face of the record”, pursuant to s. 3 of the Judicial Review Procedure Act, R.S.B.C. 1996, c. 241 (“JRPA”). Section 3 reads:
Error of law
3 The court’s power to set aside a decision because of error of law on the face of the record on an application for relief in the nature of certiorari is extended so that it applies to an application for judicial review in relation to a decision made in the exercise of a statutory power of decision to the extent it is not limited or precluded by the enactment conferring the power of decision.
[21] The “record of the proceeding” is defined in s. 1 as:
“record of the proceeding” includes the following:
(a) a document by which the proceeding is commenced; (b) a notice of a hearing in the proceeding;
(c) an intermediate order made by the tribunal;
(d) a document produced in evidence at a hearing before the tribunal, subject to any limitation expressly imposed by any other enactment on the extent to which or the purpose for which a document may be used in evidence in a proceeding;
(e) a transcript, if any, of the oral evidence given at a hearing; (f) the decision of the tribunal and any reasons given by it;
[22] The evidence before the application judge included the relevant documents submitted by the claimant as part of its trial statement as well as the initiating documents. The transcript of the proceedings indicates submissions were made by the respondent’s counsel and the petitioner’s representative, but no oral evidence was given. Simply put, submissions are not sworn evidence and are neither “facts” nor part of the record for the purpose of judicial review.
ISSUES
[23] The remaining issues therefore are:
1. Whether this petition should be dismissed on account of the petitioner’s delay in bringing the petition; and
2. Whether the application judge erred by not allowing the matter to proceed to trial on the basis of the unjust enrichment claim?
TIMELINESS
[24] The Provincial Court decision at issue was made on August 19, 2015, but the petition for judicial review was not filed until more than eight months later, on
April 25, 2016. This highlights what appears to be an anomaly arising from the combined effect of the SCA and the JRPA.
[25] If the Provincial Court had dismissed the claim following a trial, the petitioner would have had the right to appeal to this Court, but would have been required to file its notice of appeal within 40 days of the Judgment. That is the result of ss. 5 and 6 of the SCA, which reads:
Right of appeal
5 (1) Any party to a proceeding under this Act may appeal to the Supreme Court an order to allow or dismiss a claim if that order was made by a Provincial Court judge after a trial.
(2) No appeal lies from any order of the Provincial Court made in a proceeding under this Act other than an order referred to in subsection (1).
Time limit for appeal
6 An appeal must be started within 40 days, beginning on the day after the order of the Provincial Court is made.
[26] Because the order in this case was not made after a trial, s. 5 does not apply and the petitioner had no right to appeal. The legislature clearly intended to eliminate appeals to this Court from interlocutory orders.
[27] But Provincial Court orders that are not subject to appeal may still be subject to judicial review. Section 3 of the JRPA refers to decisions “made in exercise of a statutory power of decision”, which s. 1 defines as follows:
“statutory power of decision” means a power or right conferred by an enactment to make a decision deciding or prescribing
(a) the legal rights, powers, privileges, immunities, duties or liabilities of a person, or
(b) the eligibility of a person to receive, or to continue to receive, a benefit or licence, whether or not the person is legally entitled to it,
and includes the powers of the Provincial Court;
[28] The JRPA does not contain any time limit for bringing an application and deals with the question of timeliness only in s. 11:
No time limit for applications
11 An application for judicial review is not barred by passage of time
unless
(a) an enactment otherwise provides, and
(b) the court considers that substantial prejudice or hardship will result to any other person affected by reason of delay.
[29] In Baldwin v. Baldwin, 2013 BCCA 35, the Court of Appeal confirmed that orders of the Provincial Court on which there is no right of appeal may be the subject of judicial review applications and the 40 day appeal period in the SCA does not apply.
[30] The order in this case was a final order dismissing the petitioner’s claim. The petition was filed about seven months after the expiry of the time limit that would have applied if the Judgment had been made at trial. Because the order was not made at trial, the petitioner was not barred from filing its petition at that late date.
[31] However, the respondent argues that the delay was unreasonable in the circumstances and that the court can and should dismiss the petition on that basis.
[32] In Baldwin, the Provincial Court dismissed a claim on application, finding it to be frivolous and vexatious. A petition for judicial review was filed three months later. The chambers judge found that the application was in substance, an appeal and that it was out of time on the basis of the appeal period set out in the SCA. The Court of Appeal set aside that decision, stating at para. 12:
[12] Although delay is a factor that may be taken into account in judicial review proceedings, there is not specific deadline for the bringing of such a proceeding. The 40 day appeal period in s. 6 of the Small Claims Act does not apply to judicial review proceedings in relation to orders made by Provincial Court judges prior to a trial of a small claims action.
[33] The issue in Baldwin was whether the matter had been properly framed as a judicial review, rather than an appeal. The petition had been filed about two months after the appeal period would have expired and the question of whether that delay was unreasonable does not appear to have been argued.
[34] The general question of timeliness in judicial review was more recently discussed by the Court of Appeal in Lowe v. Diebolt, 2014 BCCA 280. The court noted at paras. 38-40 that the court has always had discretion at common law to deny judicial review remedies on the basis of undue delay and that this discretion has been preserved by s. 8(1) of the JRPA, which reads:
Power to refuse relief
8 (1) If, in a proceeding referred to in section 2, the court had, before February 1, 1977, a discretion to refuse to grant relief on any ground, the court has the same discretion to refuse to grant relief on the same ground.
[35] The court in Lowe said the discretion to consider undue delay is not limited by s. 11, which it said presents a number of difficulties in interpretation. The court said at paras. 45 and 46:
[45] Fortunately, it is unnecessary, for the purposes of the case before us, to fully decipher the intent of s. 11. As I read the section, it is an attempt to place an absolute bar on judicial review proceedings in certain limited situations. That absolute bar, whatever its breadth, does not serve to eliminate the discretionary bars to judicial review that are preserved by s. 8 of the JRPA. As McLachlin J.A. (as she then was) put it in Re Carpenter and Vancouver Police Board (1986), 34 D.L.R. (4th) 50 at 75, “[d]elay alone is insufficient to permit the court to refuse a remedy under the Judicial Review Procedure Act. What must be shown is ‘unreasonable delay.’”
[46] What is “unreasonable” will depend on a constellation of factors. The court must consider the underlying administrative scheme – how does it operate and what are its objectives? To what extent might those objectives be undermined by delay? The court must also consider the interests of the parties – is the issue brought forward on the judicial review of critical importance to one or the other party? On the other hand, will the delay result in hardship, prejudice, or injustice? Because judicial review is concerned with matters of public law, the effect of proceeding with the judicial review or of terminating it on the proper functioning of an administrative regime must also be considered.
[36] The purpose of the SCA is set out in s. 2 of that statute: Purpose
2 (1) The purpose of this Act and the rules is to allow people who bring claims to the Provincial Court to have them resolved and to have enforcement proceedings concluded in a just, speedy, inexpensive and simple manner.
(2) Subject to this Act and the rules, in conducting a hearing the Provincial Court may make any order or give any direction it thinks necessary to achieve the purpose of this Act and the rules.
[37] The SCR begin with the following introduction: Introduction
The purpose of these rules is to make it as easy as possible for people to use the court to resolve their disputes. If necessary, there will be a trial and a judge or a justice of the peace will decide the claim. However, both sides are encouraged to try to come to an agreement. A settlement is always possible, even after a judge or a justice of the peace has made a decision.
[38] In furtherance of that objective, the SCR require that a settlement conference be held in most cases before a trial date is set. Pursuant to R. 7(14), the power of a judge at a settlement conference includes the power to:
(i) dismiss a claim, counterclaim, reply or third party notice if, after discussion with the parties and reviewing the filed documents, a judge determines that it
(i) is without reasonable grounds,
(ii) discloses no triable issue, or
(iii) is frivolous or an abuse of the court’s process;
[39] The order dismissing the claim in this case was not made at a settlement conference but was made on application. Rule 16(6) of the SCR sets out a number of orders a judge may make after a hearing, including:
(o) any other order that a judge has the power to make and notice of which is served on another party.
[40] A judge of the Provincial Court may therefore make a final order disposing of a case at a settlement conference, on an application with notice, or at trial. The result for the parties is the same, but the order is subject to appeal only if it is made in the last of those three circumstances.
[41] The 40 day time limit for an appeal set out in s. 6 of the SCA serves the same purpose as the 30 day limit set out for appeals from this Court in s. 14 of the Court of Appeal Act, R.S.B.C. 1996, c. 77: certainty and finality.
[42] Successful parties have a legitimate interest in certainty and finality. A successful defendant is entitled to conduct his or her affairs free from the claim, just as a successful claimant is entitled to proceed with obtaining the fruits of a Judgment. If the unsuccessful party wishes to bring that certainty and finality into question, he or she is obliged to do so promptly.
[43] When a court sees fit to give Judgment as a result of a pre-trial procedure or application, the same interests in certainty and finality are engaged, as is the statutory goal of speedy resolution of claims. I see no reason why the successful party should have to wait longer to enjoy the benefit of the Judgment than he or she would have to wait if the Judgment had been given at trial.
[44] Although the application for judicial review is not subject to the appeal period in s. 6 of the SCA or to any other specific time limit, an applicant who seeks judicial review of an order giving Judgment or dismissing a claim must still act promptly. If there is to be a delay significantly greater than the 40 days that would be allowed in the case of an appeal, the applicant should, in my view, provide some evidence of a reasonable explanation for that delay.
[45] In this case, there is no evidence explaining why the petitioner needed to wait more than eight months from the date of Judgment before filing the petition for judicial review. In the absence of such an explanation, prejudice to the respondent can be presumed and I find the delay to be unreasonable in the circumstances.
I dismiss the application for judicial review on that basis.
REASONABLENESS
[46] If I am wrong in dismissing the application on the basis of timeliness, I would also dismiss the matter on its merits. The question is whether the application judge erred by not allowing the matter to proceed to trial on the basis of the unjust enrichment claim.
[47] The petitioner says the application judge erred by not allowing the matter to proceed to trial if there was a “remote chance” of success on an alternative claim of unjust enrichment. The petitioner argues that is an error of law to be reviewed on a standard of correctness.
[48] The standard of correctness applies to a question of law on an appeal of a Small Claims judgment: Park v. K.S. Mechanical Ltd., 2012 BCSC 1751. However, this is not an appeal. On judicial review of a summary dismissal, the standard is one of reasonableness: Ouimet v. Kwok, 2014 BCSC 1178 at para. 21; 0763486 B.C. Ltd. v. Landmark Realty Corp., 2009 BCSC 810 at para. 23.
[49] In Wood and Lauder v. Siwak, 2000 BCSC 397, a Provincial Court judge dismissed a claim against some defendants at a settlement conference on the application of defence counsel. The petitioners, who did not have counsel at the settlement conference, initially appealed, unaware of the restricted right of appeal in s. 5 of the SCA, then brought an application for judicial review. This Court held at paras. 23 and 24:
[23] The petitioners were unrepresented at the settlement conference, whereas the defendants were represented. Just as lay litigants are not expected to define their pleadings with strict legal exactitude, so too it must be recognized that lay litigants at a settlement conference may be disadvantaged when attempting to articulate legal issues concerning the validity of their claim. This is particularly so where, in what is envisioned as the people’s court, a simple court, there may be complicated legal issues that must be addressed in accordance with the rule of law.
[24] In the circumstances, where the settlement conference judge elected to consider the respondents’ motion to dismiss claims against some of them, the settlement conference judge had an obligation to ensure that all relevant legal issues were properly considered in order to determine whether there existed a reasonable cause of action or a triable issue…
[50] This Court arrived at a similar result in 0763486 B.C. Ltd. In that case, a Provincial Court judge dismissed a claim at a settlement conference on his own motion where both parties were unrepresented. This Court said at paragraph 35 that R. 17(14) of the SCR does not permit a judge at a settlement conference to dismiss a claim where there is a factual dispute requiring evidence, adding at para. 36:
[36] It is not clear what inquiries the settlement conference judge made concerning the Developer’s defence that it did not breach its obligations in respect of the sale. If he had properly canvassed this issue and considered the relevant provisions of the Settlement Agreement, he may have concluded that the Developer had an arguable defence to the obligation to pay a commission. In any event, it was not his role at a settlement conference to weigh the evidence. As this court said in Wood and Lauder, the threshold under Rule 7(14) is high; it must be plain and obvious that a Reply discloses no reasonable defence or clear that a defence is bound to fail. This must be considered in the context of Small Claims proceedings, as the late Chief Judge Stansfield stated in Cappos:
[15] It is the rule, rather than the exception, that pleadings in this court are, at best, inelegant. Frequently they are seriously deficient. If we dismissed every claim or defence which suffered for inadequate pleadings, our workload would be lightened considerably, but there would be a great deal of injustice to persons who have relied, at least implicitly, upon the assurance of the legislature that there will be provided to them an informal and accessible dispute resolution process. …
[51] As was pointed out in both Wood and 0763486 B.C. Ltd., R. 17(14) of the SCR is similar to R. 9-5(1) and 9-6(5) of the Supreme Court Civil Rules, BC Reg 168/2009. A claim must not be dismissed unless it is plain and obvious that it cannot succeed.
[52] The order in this case was not made at a settlement conference, but on an application for precisely that order. The petitioner had approximately six weeks’ notice of the application. The order was not made under R. 17(14) but under
R. 16(6)(o) of the SCR, which is a more general and arguably broader power.
[53] In any event, the petitioner’s notice of claim was based on an alleged contract. The application judge correctly found that the petitioner had no standing to rely on the contract. The notice of claim did not allege unjust enrichment. The application judge then said at para. 19:
[19] Finally, I have concluded this would not be an appropriate case to proceed to trial to allow Housewise to pursue a remedy based on unjust enrichment. According to the file materials, the Defendant paid for services provided by the Claimant until it firmly and repeatedly notified the Claimant in writing that the standard of service was deficient and terminating the contract based on fundamental breach. The amount claimed by Housewise relates to charges it billed after such notice was provided and to penalty provisions in the contract. From the Notice of Claim, there is no suggestion Whitgift did not keep current its obligation to pay any invoices rendered by Segal prior to the termination notice in the spring of 2012.
[54] That passage may include a factual error in that the invoices relied upon by the petitioner include, at least on their face, claims for work done before the respondent purported to terminate the petitioner’s services. However, in determining a claim for unjust enrichment, the court would not be bound by the amounts set out in the invoices but would be required to determine the actual value of the benefit or enrichment received by the respondent.
[55] The application judge noted that the petitioner, an experienced litigant, had not amended the notice of claim to allege unjust enrichment, although it had ample time to do so after receiving notice of the respondent’s position. While it is true that pleadings in Small Claims actions are frequently inadequate or unartful, the fact remains that a defendant is entitled to some notice of the basis on which a claim is being advanced.
[56] Taking those factors into consideration, I cannot find that the dismissal of the petitioner’s claim was unreasonable and I would dismiss the claim on that basis as well.
CONCLUSION
[57] The petition is dismissed with costs.
“N. Smith J.”
