Bower et al. v. Cominco Ltd. et al., (2003) 187 B.C.A.C. 287 (CA)

• Judge: Ryan, Saunders and Thackray, JJ.A.
• Court: Court of Appeal (British Columbia)
• Case Date: October 08, 2003
• Jurisdiction: British Columbia
• Citations: (2003), 187 B.C.A.C. 287 (CA);2003 BCCA 537

Bower v. Cominco Ltd. (2003), 187 B.C.A.C. 287 (CA);

    307 W.A.C. 287

MLB headnote and full text

Temp. Cite: [2003] B.C.A.C. TBEd. OC.017

Norman E. Bower, Charles Bradbury, John Bunn, Robert James Cornfield, George Forster, Karl V. Gallicano, Michael Georgetti, Jean L. Heusdens, Henry A. Hopp, Jack Howlett, Albert King, Ralph Langevin, Maxime Lepine, Norman Lucht, John McGowan, James Patterson, Elmer Pontius, Laurier Regnier, Marcus Smith, Florayanet Venturini, William Edward Walsh, Albert Warrington, and Thomas Watmough each on his own behalf and together on behalf of and representing all other beneficiaries of the Pension Plan established January 1, 1926 by the Consolidated Mining and Smelting Company of Canada, Limited which Plan became known as the "Pension Fund" of the Pension Fund Society of the Consolidated Mining Smelting Company of Canada Limited now named the Cominco Pension Fund Coordinating Society (appellants/plaintiffs) v. Cominco Ltd., Cominco Pension Fund Society and Cominco Pension Fund Coordinating Society (respondents/defendants)

(CA026722; 2003 BCCA 537)

Indexed As: Bower et al. v. Cominco Ltd. et al.

British Columbia Court of Appeal

Ryan, Saunders and Thackray, JJ.A.

October 8, 2003.

Summary:

In 1983, 1984 and 1985 Cominco Pension Fund Society (PFS) transferred pension plan funds held in a pooled fund administered by Cominco Pension Fund Coordinating Society (CPFCS) to two other Cominco Ltd. pension plans (BRIP and CERTU), whose pension funds were held by CPFCS. On July 1, 1986, CERTU and BRIP agreed to pay all pensions under the PFS plan and a portion of the PFS plan funds were transferred to BRIP and CERTU. Between 1986 and 1989 the PFS plan funds' balance was transferred to CERTU and BRIP, being treated as Comin­co's contributions to CERTU's and BRIP's current service costs. The plaintiffs sued, among others, PFS, CPFCS and Cominco Ltd., asserting that PFS was in breach of trust by authorizing the 1983 to 1989 PFS plan fund transfers, except for the 1986 transfer, and that Cominco and CPFCS were parties to the breach. Cominco, PFS and CPFCS asserted that the PFS plan, CERTU and BRIP comprised an integrated pension scheme for the benefit of Cominco employees and pensioners and denied any breach of trust. Alternatively, if the 1983 to 1985 transfers were in breach of trust, the breach was remedied when the PFS plan merged with BRIP and CERTU (July 1, 1986) and when all of the PFS plan funds had been transferred to BRIP and CERTU (1989), resulting in the plaintiffs suffering no loss.

The British Columbia Supreme Court, in a decision reported in 21 B.C.T.C. 241, held that PFS and CPFCS breached the terms of the PFS plan trust when they caused the PFS plan funds to be transferred to CERTU and BRIP between 1983 and 1985, but the breach was remedied in 1986 when the PFS plan was merged with BRIP and CERTU. The plaintiffs suffered no loss. The plaintiffs appealed.

The British Columbia Court of Appeal dismissed the appeal.

Master and Servant - Topic 1946.1

Remuneration - Pension or retirement benefits - Merger of pension plans - Comin­co established a defined benefit pension plan for its employees (PFS plan) - Assets of the PFS plan were transferred to suc­cessor pension plans from 1983-1985 and 1986-1989 - On July 1, 1986, the suc­cessor plans assumed all obligations of the PFS plan - The British Columbia Court of Appeal affirmed that (1) the PFS plan was not terminated when its assets were trans­ferred to the successor plans; (2) the PFS plan and successor plans merged; (3) the merger was lawful and consistent with the Pension Fund Societies Act, s. 13; (4) until the PFS plan was terminated, there was no ascertainable surplus to dis­tribute and (5) the transfer of funds in 1983-1985 and 1986-1989 were breaches of trust, but the breaches were remedied when all the trans­fers were finally made - See paragraphs 61 to 115.

Master and Servant - Topic 1949

Remuneration - Pension or retirement benefits - Termination of plan - [See Mas­ter and Servant - Topic 1946.1 ].

Master and Servant - Topic 1959

Remuneration - Pension or retirement benefits - Distribution of surplus funds - [See Master and Servant - Topic 1946.1 ].

Trusts - Topic 8450

Termination of trusts - By request of bene­ficiary - Grounds for refusal - Com­inco established a defined benefit pension plan for its employees (PFS plan) - Assets of the PFS plan were transferred to suc­cessor pension plans from 1983-1985 and 1986-1989 - On July 1, 1986, the suc­cessor plans assumed all obligations of the PFS plan - The British Columbia Court of Appeal held that because the PFS plan was not terminated and because it and the successor plans merged, it was not open to the plan's members to apply for a termina­tion of the trust or distribution of the trust funds - See paragraphs 97 to 115.

Cases Noticed:

Stearns Catalytic Pension Plans, Re, [1994] 2 S.C.R. 611; 168 N.R. 81; 155 A.R. 81; 73 W.A.C. 81, refd to. [para. 1].

Schmidt v. Air Products Canada Ltd. - see Stearns Catalytic Pension Plans, Re.

Buschau et al. v. Rogers Cablesystems Inc. et al. (2001), 148 B.C.A.C. 263; 243 W.A.C. 263; 195 D.L.R.(4th) 257; 83 B.C.L.R.(3d) 261 (C.A.), refd to. [para. 2].

Saunders v. Vautier (1841), 49 E.R. 282 (Rolls Ct.), not appld. [para. 8].

Imperial Group Pension Trust Ltd. v. Imperial Tobacco Ltd., [1991] 1 W.L.R. 589 (Ch. Div.), refd to. [para. 10].

Reevie et al. v. Montreal Trust Co. of Canada and Hunt-Wesson Canada (1986), 13 O.A.C. 233; 53 O.R.(2d) 595 (C.A.), consd. [para. 67].

Heilig and Andrews et al. v. Dominion Securities Pitfield Ltd. et al. (1989), 33 O.A.C. 229; 59 D.L.R.(4th) 394 (C.A.), consd. [para. 67].

Sulpetro Ltd. Retirement Plan Fund, Re (1990), 104 A.R. 215; 66 D.L.R.(4th) 271 (C.A.), consd. [para. 67].

Harbin v. Masterman, [1896] 1 Ch. 351 (C.A.), not appld. [para. 104].

Allen v. Montreal Trust Co. and McClel­lan, [1978] 1 W.W.R. 462 (Sask. C.A.), not appld. [para. 104].

Collers's Deed Trusts, Re, [1939] 1 Ch. 277 (C.A.), not appld. [para. 104].

Authors and Works Noticed:

Gillese, Eileen, Pension Plans and the Law of Trusts (1996), 75 Can. Bar Rev. 221, generally [para. 13, footnote 1]; pp. 227 [para. 14, footnote 2]; 229 [para. 19, footnote 4]; 231 [para. 22, footnote 5]; 235 [para. 92, footnote 6].

Counsel:

R.J.R. Hordo, Q.C., and P.R. Bennett, for the appellant;

I.G. Nathanson, Q.C., and G.B. Gomery, for the respondents.

This appeal was heard in Vancouver, British Columbia, on June 24 to 26, 2002, before Ryan, Saunders and Thackray, JJ.A., of the British Columbia Court of Appeal. The decision of the court was delivered on October 8, 2003, and the following opinions were filed:

Ryan, J.A. (Saunders, J.A., concurring) - see paragraphs 1 to 112;

Thackray, J.A. - see paragraphs 113 to 115.