Canada Deposit Insurance Corp. et al. v. Prisco et al., (1997) 201 A.R. 23 (QB)

• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: February 04, 1997
• Citations: (1997), 201 A.R. 23 (QB)

CDIC v. Prisco (1997), 201 A.R. 23 (QB)

MLB headnote and full text

Northland Bank and Deloitte & Touche Inc., as Liquidator of Northland Bank (plaintiffs) v. Robert A. Willson, William E. Neapole, Harold G. Green, Stephen J. Adams, Martin G. Fortier, Roland P. Guenette, George J. Bestianich, Eric R. Hayne, James A. Kellington, David Naylor, James I.M. Ross, William H. Simmons, H.B. McBain, Glen. A. Simpson, Ronald G. Scott, Harold Walker and Wieland Wettstein et al. (defend­ants) and Marc Lalonde et al. (third parties)

(Action No. 8701-14280)

Canada Deposit Insurance Corporation and Her Majesty The Queen In Right of Canada, as represented by Minister of Finance (plaintiffs) v. Sidney M. Oland, Walter A. Prisco, David R. Watson, Robert A. Willson, William E. Neapole, Harold G. Green, Stephen J. Adams, Martin G. Fortier, Roland P. Guenette, George J. Bestianich, Eric R. Hayne, James A. Kellington, David Naylor, James I.M. Ross, William H. Simmons, H.B. McBain, Glen A. Simpson, Ronald G. Scott, Harold Walker and Wieland Wettstein et al. (de­fendants) and Karl Adamsons, Andre Brossard, Joseph W. Courtright, A.F. D'Entremont, Neville Grant, William A. Kenneth and Donald M. MacPherson, Marc Lalonde, Michael Wilson, Barbara J. McDougall and Elizabeth Roscoe, Gerald Bouey and Bank of Canada, Northland Bank, Clarkson Gordon, Touche Ross & Co., Thorne Riddell, Beloitte Haskins & Sells, Deloitte & Touche Inc., Ernst & Young, Peat Marwick Thorne, William K. Detlefsen, Roderick J. McKay, Allan N. Tamaki, J. Crawford Smith, H. Graham Lebourveau, Michael MacKenzie, Ronald M. Elliot, Kenneth G. Eades, Giles Meikle, John Giesbrecht, Douglas Baker, James Peers, Donald S. Heasman, John deBruyn and Walter A. Prisco et al. (third parties)

(Action No. 9401-10435)

Indexed As: Canada Deposit Insurance Corp. et al. v. Prisco et al.

Alberta Court of Queen's Bench

Judicial District of Calgary

Moore, C.J.Q.B.

February 4, 1997.

Summary:

The Northland Bank collapsed. On Sep­tember 1, 1985, a curator was appointed to look after the bank's affairs. A Commission of Inquiry examined the collapse in detail. Its report was made public on August 26, 1986. The Canada Deposit Insurance Corp. (CDIC) and Canada itself became liable to creditors and depositors for huge sums. In 1987, they sued the former direc­tors of Northland, among others, in negli­gence and for other relief. The liquidator (Deloitte & Touche Inc.) commenced a similar action. The actions were not consolidated. In 1992 and 1993, the directors and other defendants filed third party notices against the Bank of Canada and others in both the CDIC action and the liquidator's action. Subsequently, some of the third parties and the plaintiffs in the CDIC action applied under rule 159 to strike the third party notices of the defendant Oland (a former director of Northland) on the ground that the causes of actions described in the third party notices were barred by the provi­sions of the Limitation of Actions Act because they were filed after September 1, 1991. Notice of the application was given to all defendants.

The Alberta Court of Queen's Bench, in a decision reported at 170 A.R. 388, allowed the application under rule 159 and directed that the third party proceedings be dismissed. The defendant Oland appealed.

The Alberta Court of Appeal, in a decision reported 181 A.R. 161; 116 W.A.C. 161, dismissed the appeal. On the basis of that decision, the third parties and plaintiffs in the CDIC action applied to have the third party notices issued by the other defendants struck out on the grounds of the expiry of the limitation period as well as res judicata. The third parties also applied for the same relief in regard to the third party notices issued in the liquidator's action. The defend­ants opposed the application on the ground, inter alia, that the parties were not the same as were involved in the Oland application.

The Alberta Court of Queen's Bench held that the limitation period commenced when the Commission of Inquiry issued its report (August 26, 1986). The court allowed the applications in part and struck the third party notices issued after August 26, 1992 in both actions.

Estoppel - Topic 377

Estoppel by record (res judicata) - Res judicata as a bar to subsequent proceedings - When applicable - [See Practice - Topic 1043 ].

Limitation of Actions - Topic 3090

Actions in tort - Contribution between tortfeasors - Claim to contribution by way of third party notice - The Northland Bank collapsed - On September 1, 1985, a curator was appointed to look after the bank's affairs - A Commission of Inquiry examined the collapse in detail and issued a report on August 26, 1986 - The Canada Deposit Insurance Corp. (CDIC) and the bank's liquidator commenced separate actions in negligence against Northland's directors, etc. - The defendants issued third party notices against the Bank of Canada, etc. - The third parties applied to have the third party notices dismissed on the ground they were issued after the Septem­ber 1, 1991 limitation period - The Alberta Court of Queen's Bench ruled that the six year limitation period expired on August 26, 1992 - See paragraph 61.

Practice - Topic 1043

Parties - Third party procedure - Applica­tion of limitation periods - After the col­lapse of the Northland Bank, the Canada Deposit Insurance Corp. (CDIC) and the liquidator commenced separate actions against the directors for negligence - The defendants issued third party notices in both actions - The third parties in the CDIC action applied to strike the third party notices issued by the defendant Oland on the ground that the causes of actions described in the notices were barred by the Limita­tion of Actions Act - The decision to dismiss the notices was affirmed on appeal - The third parties then applied for the dismissal of the third party notices issued by the remaining defendants in the CDIC action as well as all of the third party notices issued in the liquidator's action on the grounds of, inter alia, issue estoppel - The Alberta Court of Queen's Bench dismissed the third party notices issued after the expiry of the limitation period.

Practice - Topic 2126

Pleadings - Amendment of pleadings - Statement of defence - Adding limitation of actions plea - Following the collapse of the Northland Bank, the liquidator and the Canada Deposit Insurance Corp. (CDIC) commenced separate actions against Northland's directors - The defendants issued third party notices to the Bank of Canada, etc. - The Bank of Canada applied in the CDIC action to have the third party notice issued by one of the directors dismissed on the ground that it was outside the limitation period - The trial court's decision to dismiss the third party notice was affirmed on appeal - Prior to the trial of both actions, the Bank of Canada (in the liquidator's action) and other third parties (in both actions) applied for leave to amend their statements of defence to the third party notices in order to plead the limitation period - The Alberta Court of Queen's Bench allowed the application - See paragraphs 15, 18, 38 to 42 and 55.

Practice - Topic 5706.1

Judgments and orders - Summary judg­ments - Third party claim - Effect of - [See Prac­tice - Topic 1043 ].

Cases Noticed:

Canada Deposit Insurance Corp. et al. v. Prisco et al. (1994), 158 A.R. 305 (Q.B.), consd. [para. 8].

Canada Deposit Insurance Corp. et al. v. Prisco et al. (1995), 170 A.R. 388; 29 Alta. L.R.(3d) 125 (Q.B.), folld. [para. 10].

Canada Deposit Insurance Corp. et al. v. Prisco et al. (1996), 181 A.R. 161; 116 W.A.C. 161; 38 Alta. L.R.(3d) 97 (C.A.), leave to appeal denied, [1996] S.C.C.A. No. 266 (S.C.C.), refd to. [para. 11].

Carl-Zeiss-Stiftung v. Rayner & Keeler Ltd., [1966] 2 All E.R. 536 (H.L.), appld. [para. 24].

Angle v. Minister of National Revenue, [1975] 2 S.C.R. 248; 2 N.R. 397; 47 D.L.R.(3d) 544, appld. [para. 24].

Canada Permanent Trust Co. v. King Art Development Ltd. et al. (1984), 52 A.R. 139 (C.A.), consd. [para. 39].

Holt, Renfrew & Co. v. Henry Singer Ltd. et al., [1981] 3 W.W.R. 9; 30 A.R. 254 (Q.B.), refd to. [para. 40].

McLean v. Canadian Pacific Railway (1917), 33 D.L.R. 647 (Alta. C.A.), refd to. [para. 40].

Miller v. Canadian Pacific Railway Co., [1933] 1 W.W.R. 233 (Alta. C.A.), refd to. [para. 41].

Royal Bank of Canada v. Elpat Holdings Ltd. (1990), 109 A.R. 49; 76 Alta. L.R.(2d) 167 (Q.B.), refd to. [para. 41].

Frobisher Ltd. v. Canadian Pipelines & Petroleums Ltd., [1960] S.C.R. 126, affing. (1957), 10 D.L.R.(2d) 338 (Sask. C.A.), consd. [para. 41].

Basarsky v. Quinlan, [1972] 1 W.W.R. 303 (S.C.C.), consd. [para. 42].

Leeds et al. v. Alberta (Minister of the Environ­ment) et al. (1989), 98 A.R. 178 (C.A.), refd to. [para. 45].

Cascade Development Corp. et al. v. Red Deer College (1992), 129 A.R. 55 (Q.B.), refd to. [para. 45].

Royal Bank of Canada v. Elpat Holdings Ltd. (1990), 108 A.R. 59; 74 Alta. L.R.(2d) 207 (Q.B.), consd. [para. 47].

Hunter v. Chief Constable of the West Mid­lands Police, [1981] 3 All E.R. 727 (H.L.), refd to. [para. 50].

Statutes Noticed:

Limitation of Actions Act, R.S.A. 1980, c. L-15, generally [para. 15].

Rules of Court (Alta.), rule 129(1)(a), rule 129(2) [para. 8]; rule 132 [para. 38]; rule 159(2) [para. 43].

Authors and Works Noticed:

Estey, W.Z., Report of the Inquiry into the Collapse of the CCB and Northland Bank (1986), pp. 1 [para. 3]; 129 [para. 35].

Spencer Bower and Turner, The Doctrine of Res Judicata (2nd Ed. 1969), pp. 209-210 [para. 50].

Watson, G.D., Duplicative Litigation: Issue Estoppel, Abuse of Process and the Death of Mutuality (1990), 69 Can. Bar Rev. 623, p. 623 [para. 53].

Counsel:

Robert M. Curtis (McCuaig Desrochers), for Gerald Bouey and Bank of Canada;

Donald Dear, Roderak A. McLennan, Q.C. (McLennan Ross), for Deloitte Haskins & Sells et al. and Touche Ross & Co. et al.;

Peter R.S. Leveque (Bennett Jones Verchere), for Clarkson Gordon, Thorne Riddell, W.K. Detlefson, Roderick J. McKay, Allan N. Tamaki, J. Crawford Smith, H. Graham Le Bourveau, Michael MacKenzie and James Peers;

Grant S. Dunlop (Ogilivie & Co.), for Canada Deposit Insurance Corporation and Her Majesty The Queen In Right of Canada as represented by the Ministers of Finance and Karl Adamsons, Andre Brossard, Joseph W. Courtright, A.F. D'Entremont, Neville Grant, William A. Kenneth, Donald M. MacPherson, Marc Lalonde, Michael Wilson, Barbara J. McDougall and Elizabeth Roscoe;

Dean Allatt (Howard, Mackie), for Deloitte & Touche Inc.;

Philip G. Lister, Q.C. (Philip G. Lister Professional Corp.), for Thomas R. Goodson;

J.P. Peacock, Q.C. (Peacock, Linder & Halt), for R.A. Fabro, Peter V. Gundy, Ralph B. MacMillan, Alan W. Scarth and Donald G. Skagen;

Thomas H. Ferguson, Q.C., and James L. Lebo, Q.C. (McCarthy Tetrault), for W. Gordon Barker and Erdman Klassen;

L.R. Duncan, Q.C., W.E. Brett Code (Sean S. Smyth Duncan Kelly), for Sidney M. Oland and Robert A. Wilson;

Wieland Wettstein appeared on his own behalf.

These applications were heard at Calgary, Alberta, before Moore, C.J.Q.B., of the Alberta Court of Queen's Bench, Judicial District of Calgary, who delivered the fol­lowing decision on February 4, 1997.