Coughlan et al. v. Westminer Canada Ltd. et al., (1994) 127 N.S.R.(2d) 241 (CA)

• Judge: Clarke, C.J.N.S., Freeman and Roscoe, JJ.A.
• Court: Court of Appeal of Nova Scotia (Canada)
• Case Date: January 18, 1994
• Jurisdiction: Nova Scotia
• Citations: (1994), 127 N.S.R.(2d) 241 (CA)

Coughlan v. Westminer Can. Ltd. (1994), 127 N.S.R.(2d) 241 (CA);

 355 A.P.R. 241

MLB headnote and full text

Westminer Canada Limited, Westminer Canada Holdings Limited, James H. Lalor, Peter Maloney, Donald Snell, William B. Braithwaite, Robert Couzin and Western Mining Corporation Holdings Limited (appellants/respondents by cross-appeal) v. John A. Amirault, H. Robert Hemming, Colin J. MacDonald, William S. McCartney and Fred Hansen (respondents/appellants by cross-appeal)

Westminer Canada Limited, Westminer Canada Holdings Limited and Western Mining Corporation Holdings Limited (appellants/respondents by cross- appeal) v. John A. Amirault, H. Robert Hemming, Colin J. MacDonald, William S. McCartney and Fred Hansen (respondents/appellants by cross-appeal)

(C.A. No. 02865)

Westminer Canada Holdings Limited, Westminer Canada Limited, James H. Lalor, Peter Maloney, Donald Snell, William B. Braithwaite, Robert Couzin, Western Mining Corporation Holdings Limited, Sir Arvi Parbo, Hugh M. Morgan, Donald H. Aitken, John C. Anderson, Sir Geoffrey Badger, David J. Brydon, Sir Harold Knight, Dame Leonie Kramer, Donald M. Morley, Roy Woodall and Colin Wise (appellant/respondents by cross-appeal) v. Terence D. Coughlan and John A. Garnett (respondents/appellants by cross- appeal)

Westminer Canada Limited, Westminer Canada Holdings Limited and Western Mining Corporation Holdings Limited (appellants/respondents by cross-appeal) v. Terence D. Coughlan and John A. Garnett (respondents/appellants by cross-appeal)

(C.A. No. 02866)

Indexed As: Coughlan et al. v. Westminer Canada Ltd. et al.

Nova Scotia Court of Appeal

Clarke, C.J.N.S., Freeman and Roscoe, JJ.A.

January 18, 1994.

Summary:

An Australian company purchased Sea­bright Resources Inc. and other corporations, amalgamating them into a new company called Westminer Canada Ltd. (subsidiary), wholly owned by Westminer Canada Hold­ing Ltd. (parent). The parent and subsidiary brought an action in Ontario against the former directors of Seabright, alleging fraud, deceit and conspiracy, negligence and insider trading against two of the directors (Cough­lan and Garnett) and only negligence and insider trading against the remaining former direc­tors. The statement of claim was later amended to plead wilful misrepresentation in place of negligence. Seabright had a direc­tor's and officer's insurance policy, which the insurer advised had expired. Seabright bylaws contained indemnity provisions which could accrue to the benefit of former directors. Coughlan and Garnett (together) and the remaining directors brought separate actions claiming conspiracy to deprive them of insurance coverage, breach of fiduciary obligation, breach of duty of care, negli­gence and abuse of process. Coughlan and Garnett (together) and the remaining direc­tors also brought separate actions claiming indemnity under the Seabright bylaw, in­demnity under the Canada Business Corpo­rations Act, that the defendants induced a breach of contract, abuse of process and conspiracy.

The Nova Scotia Supreme Court, Trial Division, in a judgment reported 120 N.S.R.(2d) 91; 332 A.P.R. 91, allowed the plaintiffs' actions. The court stated that Westminer et al. were liable in tort to all directors for civil con­spiracy to injure. The court awarded $200,000 general damages to each outside director, $50,000 to Garnett and $1,000,000 to Coughlan. The court also held that West­miner et al. were liable for pre­cluding the direct­or's entitlement to claim under the insurance policy and that all di­rectors were entitled to indemnity. The defendants appealed on issues of liability, damages, interest and costs. The plaintiffs cross-appealed on the issues of damages, interest and costs.

The Nova Scotia Court of Appeal dis­missed the defendants' appeal and allowed the plaintiffs' cross-appeal in part.

Barristers and Solicitors - Topic 803

Duty to court - Counsel as a witness - Effect of - A law firm had a long rela­tionship with the plaintiff - Members of the firm testified for the plaintiff in an action - The defendants complained of conflict of interest - The Nova Scotia Court of Appeal held that there was no conflict or impropriety - The lawyers were not involved with the plaintiff's action, because they knew they would be witnesses, although they continued to work for the plaintiff on other matters - The experienced trial judge was aware of the relationship and would have taken it into account in assessing the credibility of the lawyer witnesses - The trial judge's refer­ence to and acceptance of the evidence did not materially or adversely affect the ulti­mate conclusions he reached - See para­graphs 27 to 43.

Company Law - Topic 4194

Directors - Liability of directors - Indem­nity clauses - Scope of - Westminer acquired control of Seabright and sued its former directors for fraud, etc. - A Sea­bright bylaw provided that the directors would be indemnified for all acts done honestly and in good faith with a view to the best interests of the corporation - The trial judge held that there was no fraud by the directors and the acts complained of were done honestly and in good faith in the best interests of the corporation - Accordingly, the indemnity clause applied to the former directors - The Nova Scotia Court of Appeal affirmed the decision - See paragraphs 44 to 75.

Company Law - Topic 4194

Directors - Liability of directors - Indem­nity clauses - Scope of - The plaintiff directors were awarded damages for the defendants' civil conspiracy to injure them - The plaintiffs were entitled to indemni­fication under the company's bylaws - The trial judge awarded the successful plaintiffs solicitor and client costs, but declined to include them as part of the indemnity award, thereby depriving the plaintiffs of prejudgment interest - The Nova Scotia Court of Appeal stated that the expenses of obtaining indemnification were covered by the indemnification - Accordingly, the solicitor and client costs were included as part of the indemnity - See paragraphs 171 to 181.

Damage Awards - Topic 696

Torts - Injury to economic or business relations - Conspiracy to injure - [See first Torts - Topic 5086 ].

Damage Awards - Topic 696

Torts - Injury to economic or business relations - Conspiracy to injure - The purchaser of the shares of a corporation sued the directors for fraud - The fraud allegation was unfounded - Coughlan was the director who was the driving force who started the purchased company - Stress from the four year battle contributed to his marriage breakdown - His reputation and business credibility were forever damaged - The fraud charges and Ontario Securities Commission hear­ings received national publicity - Coughlan lost friends and business oppor­tunities - The trial judge awarded Coughlan $1,000,000 general damages - The Nova Scotia Court of Appeal refused to interfere with the dam­age award - See paragraphs 127 to 140.

Damages - Topic 535

Limits of compensatory damages - Re­moteness - Torts - Nonrecoverable dam­ages - Coughlan was a director of a cor­poration purchased by Westminer - Coughlan went on to start a new company - Westminer brought an unfounded action in fraud against Coughlan and other direc­tors, committing the tort of civil conspir­acy to injure - Coughlan's new company ended up in receivership from an inability to raise sufficient capital - Coughlan claimed damages for his loss as being directly attributable to Westminer's tortious conduct - The trial judge declined to award damages, because the losses were not proved to be directly attributable to the tortious conduct - The actual loss might be too remote for consideration - The Nova Scotia Court of Appeal affirmed the decision - See paragraphs 148 to 160.

Damages - Topic 1322.1

Exemplary or punitive damages - Bars - Award unnecessary - The plaintiffs were awarded damages, costs and prejudgment interest of approximately $10,000,000 at trial - The Nova Scotia Court of Appeal stated that the size of the award was suffi­cient to deter others from similar conduct, to compensate the plaintiffs for any aggra­vated damages suffered and to punish the defendants - The court stated that the trial judge did not err in refusing to award punitive damages against the defendants - See paragraphs 161 to 167.

Equity - Topic 3606

Fiduciary or confidential relationships - Fiduciary relationship - What constitutes - Westminer purchased Seabright's shares - Seabright had a director's and officer's liability policy which expired August 1, 1988 - It was a claims made policy, pro­viding coverage only for claims made before August 1 - Westminer decided, before August 1, to sue Seabright's former directors for fraud, etc. - Westminer knew of the insurance policy, but served the statements of claim on August 2, preclud­ing the directors from claiming under the policy - The trial judge held that West­miner was liable for breach of fiduciary duty owed to the former directors - West­miner was an agent under the policy to act on behalf of the former directors concern­ing all matters relating to the policy - The Nova Scotia Court of Appeal affirmed the decision - See paragraphs 44 to 75.

Fraud and Misrepresentation - Topic 6

Fraudulent misrepresentation (deceit) - Fraudulent misrepresentation - What con­stitutes - The purchaser of a junior mining company's shares claimed the company's directors fraudulently misrepresented the commercial viability of the as yet nonpro­ducing mine - The purchaser argued the public information provided to share­holders and the stock exchanges proved to be false and the mine was worthless - The trial judge stated that there were no fraud­ulent misrepresentations by the directors - The directors believed the information being published - It was provided by experts and outside consultants, who the directors were entitled to rely upon - While there were problems of continuity and grade, the information did not suggest other than that the problems were solvable and there would be two active, producing gold mines - The Nova Scotia Court of Appeal affirmed the decision - See para­graphs 1 to 26.

Insurance - Topic 7629

Professional liability insurance - Scope of coverage - Policy period - Notice of claim - Westminer purchased Seabright's shares - Seabright had a director's and officer's liability policy which expired August 1, 1988 - It was a claims made policy, providing coverage only for claims made before August 1 - Westminer decided, before August 1, to sue Sea­bright's former directors for fraud, etc. - Westminer knew of the insurance policy, but served the statements of claim on August 2, precluding the directors from claiming under the policy - The trial judge held that Westminer was an agent under the policy and breached its duty to give notice of the claim to the insurer - Addi­tionally, Westminer was negligent in fail­ing to serve the statements of claim early enough to allow the directors to claim under the policy - The court stated that Westminer owed the directors a general duty of care - The Nova Scotia Court of Appeal affirmed the decision - See para­graphs 44 to 75.

Interest - Topic 5009

As damages - Prejudgment interest - Calculation of - The defendants submitted that the trial judge erred in awarding the plaintiffs prejudgment interest on their damage awards, because the awards inher­ently included an inflationary component - The Nova Scotia Court of Appeal stated that the trial judge did not err, where there was no indication that an inflationary factor was built into the damage awards - The court noted that the awards were not for "pain and suffering", but compensated the plaintiffs for a variety of injuries, including pecuniary losses - See para­graphs 203 to 205.

Interest - Topic 5009

As damages - Prejudgment interest - Calculation of - The trial judge awarded prejudgment interest until the date of the Order for Judgment (May 14) and not to the date of the final Order Taxing Costs and Assessing Damages (August 4) - Section 41(i) of the Judicature Act pro­vided that prejudgment interest was pay­able to "the date of judgment after trial" - The Nova Scotia Court of Appeal held that prejudgment interest ceased on May 14 on the general damage awards finally deter­mined on that date - However, for those items not assessed until August 4, pre­judgment interest continued to run until that date - See paragraphs 216 to 224.

Interest - Topic 5013

As damages - Prejudgment interest - On indemnity awards - The plaintiffs appealed the trial judge's decision not to award prejudgment interest on an indemnity award - The Nova Scotia Court of Appeal stated that the indemnity award was the "recovery of any debt or damages" (Judi­cature Act, s. 41(i)) and not in the nature of costs - Accordingly, there was no valid reason to deny prejudgment interest, which was necessary to fully compensate the plaintiffs - See paragraphs 206 to 215.

Practice - Topic 7024

Costs - Party and party costs - Entitle­ment to - Successful party - Exceptions - The plaintiffs' action was dismissed as against several of the defendants, without costs - Those defendants claimed the trial judge erred in failing to award them costs - The Nova Scotia Court of Appeal held that the trial judge did not err in exercising his discretion - The successful defendants joined in the defence of the actions by the unsuccessful defendants - They were represented by the same counsel - There was no evidence that the successful de­fendants incurred any legal costs - They were parties in their corporate capacity as opposed to their personal capacity - The court stated that it was not unreasonable for those defendants to have been joined as parties to the action - See paragraphs 198 to 202.

Securities Regulation - Topic 5311

Trading in securities - Offences - Material changes or facts - Nondisclosure - A junior mining company disclosed informa­tion as to the expected grade of two gold mines - The purchaser of the company's shares claimed the directors breached s. 75 of the Ontario Securities Act and National Policy No. 40 by failing to disclose "material changes" and "material facts" which could reasonably be expected to significantly affect the market value of the company's shares - The trial judge stated that there were no undisclosed material changes - The purchaser claimed the undisclosed results of initial ore samples and testing, indicating the expected grade may not be present, constituted a violation of s. 75 - The court stated that each test result was inconclusive by itself - The actual grade was a material fact, but was only estab­lished after the share purchase, after the testing process was complete - Accord­ingly, there was no failure to dis­close a material fact - The Nova Scotia Court of Appeal affirmed the decision - See paragraphs 1 to 26.

Torts - Topic 77

Negligence - Duty of care - Relationship required to raise duty of care - [See In­surance - Topic 7629 ].

Torts - Topic 5086

Interference with economic relations - Conspiracy - Conspiracy to injure - Westminer acquired control of Seabright - Three related corporations, including Westminer, sued the former Seabright directors, including the outside directors, alleging fraud - The outside directors sued the corporation for civil conspiracy to injure - The trial judge allowed the action - The court stated that the predominant purpose of the action was clearly to punish or injure the outside directors - The fraud allegation was made without any evidence to support it and the outside directors incurred enormous expense in both time and money - The court awarded each outside director $200,000 general damages - The Nova Scotia Court of Appeal affirmed the decision - See paragraphs 76 to 110.

Torts - Topic 5086

Interference with economic relations - Conspiracy - Conspiracy to injure - Westminer acquired control of Seabright - Three related corporations, including Westminer, sued the former Seabright directors for fraud - Two of the directors sued for civil conspiracy to injure - The trial judge allowed the action - The pre­domi­nant purpose of the lawsuit was to punish or injure the two directors - The fraud allegation was made without any evidence to support it - The Nova Scotia Court of Appeal affirmed the decision - See paragraphs 76 to 110.

Torts - Topic 5086

Interference with economic relations - Conspiracy - Conspiracy to injure - The Nova Scotia Court of Appeal stated that two ways in which the tort of civil con­spiracy could be committed were (1) there will be actionable conspiracy if the de­fendants combine to act lawfully with the predominating purpose of injuring the plaintiff and (2) where two or more per­sons agree and combine to act unlawfully with the predominating purpose of injuring the plaintiff - See paragraphs 96 to 97.

Torts - Topic 5208

Interference with economic relations - Contracts - Inducing breach of contract - The plaintiff directors claimed the defend­ants were liable for inducing breach of a contractual right to indemnity under com­pany bylaws - The trial judge found it unnecessary to decide the issue, because he found liability on the basis of the tort of civil conspiracy - The Nova Scotia Court of Appeal stated that "in the absence of the finding of civil conspiracy, the [plaintiffs] would have established the tort of inducing a breach of a legal right. We are not of the opinion the trial judge erred in considering it to have been subsumed in the conspiracy finding." - See paragraphs 11 to 122.

Torts - Topic 6252

Abuse of legal proceedings - Abuse of process - Elements - The trial judge stated that the essential requirements for the tort of abuse of process, distinct from the tort of malicious prosecution, were "(1) The defendant must have used the legal pro­cess; (2) He must have done so for a purpose other than that which the process in question was designed to serve, that is, for a collateral and illicit purpose; (3) He must have done some definite act or made some definite threat in furtherance of the purpose; and (4) Some measure of special damage must be shown." - The trial judge dismissed a claim of abuse of process on the ground that condition number 3 was not met - The Nova Scotia Court of Appeal held that it was not established that the trial judge erred in his decision - See paragraphs 123 to 126.

Cases Noticed:

Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959; 117 N.R. 321; 4 C.C.L.T.(2d) 1; 43 C.P.C.(2d) 105; 49 B.C.L.R.(2d) 273; 74 D.L.R.(4th) 321, refd to. [para. 80].

Lonrho Plc. v. Fayed, [1992] 1 A.C. 448; 127 N.R. 295 (H.L.), refd to. [para. 80].

Rondel v. Worsley, [1967] 3 All E.R. 993 (H.L.), not appld. [para. 86].

Demarco v. Ungaro (1979), 21 O.R.(2d) 673 (H.C.), refd to. [para. 86].

Speed Seal Products Ltd. v. Paddington, [1986] 1 All E.R. 91; [1985] 1 W.L.R. 1327 (C.A.), refd to. [para. 89].

Roy v. Prior, [1971] A.C. 470 (H.L.), refd to. [para. 90].

Little v. Law Institute of Victoria, [1990] V.R. 257, refd to. [para. 90].

Nelles v. Ontario et al. (1989), 98 N.R. 321; 35 O.A.C. 161; 60 D.L.R.(4th) 609 (S.C.C.), refd to. [para. 90].

Roncarelli v. Duplessis (1959), 16 D.L.R.(2d) 6898 (S.C.C.), refd to. [para. 90].

Cabassi v. Vila (1940), 64 C.L.R. 130; 47 A.L.R. 33, refd to. [para. 90].

Berry v. British Transport Commission, [1961] 1 Q.B. 149, revd. [1962] 1 Q.B. 306 (C.A.), refd to. [para. 90].

Churchill v. Siggers (1854), 3 El. & Bl. 929; 118 E.R. 1389, refd to. [para. 90].

Wiffen v. Bailey and Romford Urban District Council, [1915] 1 K.B. 600, refd to. [para. 90].

Grainger v. Hill (1838), 4 Bing N.C. 212; 138 E.R. 769, refd to. [para. 90].

Dorene Ltd. v. Suedes (Ireland) Ltd., [1981] I.R. 312, refd to. [para. 90].

Quartz Hill Consolidated Gold Mining Co. v. Eyre (1883), 11 Q.B.D. 674, refd to. [para. 90].

Midland Bank v. Green (No. 3), [1979] 1 Ch. 496, refd to. [para. 102].

Poulterer's Case (1611), 9 Co. Rep. 55(b), refd to. [para. 102].

Ward v. Lewis, [1954] 1 All E.R. 55 (C.A.), refd to. [para. 114].

Lumley v. Gye (1853), 2 El. & Bl. 216; 118 E.R. 749 (Q.B.), refd to. [para. 117].

Quinn v. Leathem, [1901] A.C. 495, refd to. [para. 118].

Newell v. Baker, [1950] S.C.R. 385, refd to. [para. 119].

Andrews v. Grand & Toy (Alberta) Ltd., [1978] 2 S.C.R. 229; 19 N.R. 50; 8 A.R. 182; 83 D.L.R.(3d) 452; [1978] 1 W.W.R. 577; 3 C.C.L.T. 225, refd to. [para. 129].

Teno et al. v. Arnold et al., [1978] 2 S.C.R. 287; 19 N.R. 1; 3 C.C.L.T. 372; 83 D.L.R.(3d) 609, refd to. [para. 129].

Thornton et al. v. Board of School Trustees of School District No. 57 et al., [1978] 2 S.C.R. 267; 19 N.R. 552; 83 D.L.R.(3d) 480; [1978] 1 W.W.R. 607; 3 C.C.L.T. 257, refd to. [para. 129].

Mailman v. Dartmouth Yacht Club (1992), 114 N.S.R.(2d) 441; 313 A.P.R. 414 (C.A.), refd to. [para. 135].

Canadian National Railway Co. et al. v. Norsk Pacific Steamship Co. and Tug Jervis Crown et al., [1992] 1 S.C.R. 1021; 137 N.R. 241, refd to. [para. 153].

Stein Estate et al. v. Ship Kathy K, [1976] 2 S.C.R. 802; 6 N.R. 359; 62 D.L.R.(3d) 1, refd to. [para. 157].

Rhodenizer v. Rhodenizer (1953), 31 M.P.R. 127, refd to. [para. 158].

Vorvis v. Insurance Corporation of British Columbia, [1989] 1 S.C.R. 1085; 94 N.R. 321; 58 D.L.R.(4th) 193; [1989] 4 W.W.R. 218; 36 B.C.L.R.(2d) 273; 90 C.L.L.C. 14,035; 25 C.C.E.L. 81, refd to. [para. 163].

Warner v. Arsenault (1982), 53 N.S.R.(2d) 146; 109 A.P.R. 146 (C.A.), refd to. [para. 164].

Claiborne Industries Ltd. v. National Bank of Canada (1989), 34 O.A.C. 241; 59 D.L.R.(4th) 533 (C.A.), refd to. [para. 165].

Walker and Walker Brothers Quarries Ltd. v. CFTO Ltd. et al. (1987), 19 O.A.C. 10; 37 D.L.R.(4th) 224 (C.A.), refd to. [para. 166].

Nowegijick v. Minister of National Rev­enue et al., [1983] 1 S.C.R. 29; 46 N.R. 41, refd to. [para. 178].

Professional Insurance Co. v. Barry (1969), 303 N.Y.S.2d 556 (S.C.), refd to. [para. 180].

Lockhart v. MacDonald (1980), 42 N.S.R.(2d) 29; 77 A.P.R. 29 (C.A.), refd to. [para. 194].

Bent v. Farm Loan Board (N.S.), Horsnell and Horsnell (1978), 30 N.S.R.(2d) 552; 49 A.P.R. 552; 8 C.P.C. 318 (C.A.), refd to. [para. 200].

Davis v. Lively and Davis & Lively Land Development Ltd. (1980), 43 N.S.R.(2d) 700; 81 A.P.R. 700 (C.A.), refd to. [para. 201].

Bush v. Air Canada (1992), 109 N.S.R.(2d) 91; 297 A.P.R. 91 (C.A.), refd to. [para. 203].

Blair v. Consolidated Enfield Corp. (1993), 66 O.A.C. 121 (C.A.), refd to. [para. 207].

B.P. Exploration Co. v. Hunt (No. 2), [1982] 1 All E.R. 925 (H.L.), refd to. [para. 208].

Bishop, Re (1880), 15 Ch. D. 400 (A.C.), refd to. [para. 212].

Maryon (John) International Ltd. et al. v. New Brunswick Telephone Co. (1982), 43 N.B.R.(2d) 469; 113 A.P.R. 469; 141 D.L.R.(3d) 193 (C.A.), refd to. [para. 213].

Erco Industries Ltd. v. Allendale Mutual Insurance Co. (No. 2) (1984), 48 O.R.(2d) 17 (Ont. H.C.), refd to. [para. 217].

Anderson (Emil) Construction Co. v. Brit­ish Columbia Railway Co. (1988), 31 B.C.L.R.(2d) 223 (S.C.), refd to. [para. 217].

Statutes Noticed:

Canada Business Corporations Act, R.S.C. 1985, c. C-44, sect. 124 [para. 45].

Civil Procedure Rules (N.S.), rule 33.01(1)(a), rule 33.01(1)(c) [para. 221]; rule 33.01(3) [para. 222]; rule 62.23 [para. 106].

Criminal Code, R.S.C. 1985, c. C-46, sect. 46(3), sect. 465 [para. 101].

Interest on Judgments Act, R.S.N.S. 1989, c. 233, generally [para. 217].

Judicature Act, R.S.N.S. 1989, c. 240, sect. 41(i) [para. 206].

Survival of Actions Act, R.S.N.S. 1989, c. 453, sect. 4(c) [para. 141].

Authors and Works Noticed:

Black's Law Dictionary (4th Ed.) [para. 180].

Flemming, John G., The Law of Torts (1987), p. 592 [para. 93].

Flemming, John G., The Law of Torts (4th Ed. 1971), pp. 603, 604 [para. 121].

Halsbury's Laws of England (4th Ed.), vol. 20, p. 173 [para. 211].

Rainaldi, Remedies in Tort, vol. 4, p. 27-47 [para. 162].

Wade, John W., On Frivolous Litigation: A Study of Tort Liability and Procedural Sanctions (1986), 14 Hofstra Law Rev. (No. 3), generally [para. 91].

Winfield, Percy Henry, The History of Conspiracy and Abuse of Legal Pro­cedure (1921), generally [para. 99].

Counsel:

Claude R. Thomson, Q.C., Peter L. Roy, Catherine Wright and Thomas P. Donovan, for the appellants;

George W. MacDonald, Q.C., Michelle C. Awad and Charles F. Scott, for the re­spondents in C.A. No. 02865;

David A. Miller, Q.C., Jonathan Stobie and D. Geoffrey Machum, for the respon­dents in C.A. No. 02866.

This appeal was heard at Halifax, N.S., on November 29-30 and December 1-3 and 7, 1993, before Clarke, C.J.N.S., Freeman and Roscoe, JJ.A., of the Nova Scotia Court of Appeal.

On January 18, 1994, the following judg­ment was delivered by the Court.