Gablehouse v. Borza et al., (2010) 485 A.R. 364 (QB)

• Judge: Veit, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: May 04, 2010
• Citations: (2010), 485 A.R. 364 (QB);2010 ABQB 294

Gablehouse v. Borza (2010), 485 A.R. 364 (QB)

MLB headnote and full text

Temp. Cite: [2010] A.R. TBEd. JN.011

Richard Darrell Gablehouse (plaintiff) v. Ryan J. Borza, Borza Inspections Ltd. and Derrick Dodge (1980) Ltd. (defendants) and Ryan J. Borza and Borza Inspections Ltd. (third party)

(0403 01301; 2010 ABQB 294)

Indexed As: Gablehouse v. Borza et al.

Alberta Court of Queen's Bench

Judicial District of Edmonton

Veit, J.

May 30, 2010.

Summary:

At 7:15 a.m. on January 24, 2002, the vehicle Gablehouse was driving was negligently struck by a Dodge van driven by Borza, an employee of Borza Inspections Ltd. Borza and Borza Inspections admitted liability and entered into a Pierringer Agreement by which they paid to Gablehouse (structured settlement) the first $1 million of Gablehouse's claim. The remaining quantum of damages was settled at $900,000, subject to the determination of liability. The van had been leased by Borza Inspections from Derrick Dodge (1980) Ltd; however, on January 22, 2002, Borza Inspections had mailed to Derrick Dodge a cheque purportedly in satisfaction of the lease's buy-out option. In order to determine whether, at the time of the collision, the van was still owned by Derrick Dodge, using the procedure set out in rule 232, the parties put a stated case before the court, namely, at the time of the collision had title to the van passed to Borza Inspections.

The Alberta Court of Queen's Bench held that, at 7:15 a.m. on January 24, 2002, title to the van was still in Derrick Dodge. The evidence established that the parties intended title to the van to be transferred to Borza Inspections when all payments had been made and when Borza Inspections had signed the Bill of Sale. At 7:15 a.m. on January 24, 2002, Derrick Dodge had not received the January 1, 2002 lease payment, had not received the buy-out cheque, and had not finalized the Bill of Sale. In the result, Derrick Doldge was an "owner" of the van under the applicable legislation and was therefore vicariously liable for the fault of Borza. Gablehouse was entitled to an all-inclusive judgment of $900,000 against Derrick Dodge.

Carriers - Topic 1462

Provincial legislation - Interpretation - Alberta Traffic Safety Act and Regulations - [See first Sale of Goods - Topic 2708 ].

Contracts - Topic 1304

Formation of contract - Acceptance - By mail - [See second Practice - Topic 5269 ].

Contracts - Topic 2520

Variation or alteration - By parties - Power of parties to vary or alter - [See Sale of Goods - Topic 2741 ].

Motor Vehicles - Topic 54

General and definitions - Definitions - Owner - Defined - [See Motor Vehicles - Topic 4121] .

Motor Vehicles - Topic 4121

Offences - Liability of owner - General - On January 24, 2002, the vehicle the plaintiff was driving was negligently struck by a Dodge van driven by an employee of Borza Inspections Ltd. - The van had been leased by Borza Inspections from Derrick Dodge - On January 22, 2002, Borza Inspections had mailed to Derrick a cheque purportedly in satisfaction of the lease's buy-out option - In order to determine whether, at the time of the collision, the van was still owned by Derrick, the parties put a stated case before the court, namely, at the time of the collision had title to the van passed to Borza Inspections - The Alberta Court of Queen's Bench stated that "there can be more than one 'owner' of a vehicle. Although perhaps the more common concern is whether a lessee of a vehicle can be considered or deemed to be an owner of the leased vehicle, there is no doubt that the owner of a vehicle remains an owner of the vehicle for purposes of liability under the Highway Traffic Act and, indeed, the Traffic Safety Act" - In the end result, both Borza Inspections and Derrick were owners of the van - Derrick was deemed to be an "owner" under s. 181 of the Highway Traffic Act, making it vicariously liable for the fault of the driver - See paragraph 49.

Practice - Topic 5260

Trials - General - Trial of preliminary issues - General principles (incl. when available or appropriate) - The Alberta Court of Queen's Bench stated that "[i]n assessing whether to accept a stated case for determination, presumably a court would be concerned, at a minimum, both with the adequacy of the fact base presented by the parties relative to the question stated and with the general appropriateness of using the rule. As to the latter, the court would be guided by the case law interpreting rules 220-224 which generally holds that those rules should be used only for short and simple matters involving no disputed questions of fact. In this latter context, it is important to note that one crucial difference between rules 220-224 and rule 232 is that the latter can be used where facts are in dispute; rule 232(2) specifically authorizes the court to draw inferences of fact as a trial" - See paragraph 27.

Practice - Topic 5260

Trials - General - Trial of preliminary issues - General principles (incl. when available or appropriate) - This special chambers application was brought, with the concurrence of both parties, to obtain the opinion of the court on a question of law - With one notable exception, the facts were agreed - The Alberta Court of Queen's Bench was satisfied that the documentary evidence agreed to by the parties, together with the discovery evidence allowed the court to draw all necessary inferences of fact to resolve the stated case - The case stated by the parties was therefore accepted by the court for determination - See paragraph 28.

Practice - Topic 5260

Trials - General - Trial of preliminary issues - General principles (incl. when available or appropriate) - Prior to the bringing of this special chambers application, the parties had signed and filed a certificate of readiness which indicated that each had completed their pretrial process - Rule 236(6) of the Alberta Rules of Court provided that "Except by leave of the court, a party who has filed a certificate of readiness or Order shall not initiate or continue (a) any interlocutory proceedings ..." - The Alberta Court of Queen's Bench stated that, in the circumstances, it was clearly appropriate to grant leave - "The relevant circumstances include the agreement of the parties to bring this motion, the settlement by the parties of most disputed matters in the proceedings and the benefit to both the parties and the court if the several weeks of trial time can fairly be eliminated" - See paragraphs 30 and 31.

Practice - Topic 5261

Trials - General - Trial of preliminary issues - Issues of law - [See Motor Vehicles - Topic 4121 ].

Practice - Topic 5266

Trials - General - Trial of preliminary issues - Stating special case by consent - General - This special chambers application was brought, with the concurrence of both parties, to obtain the opinion of the court on a question of law (Alberta Rules of Court, rule 232(1)) - The Alberta Court of Queen's Bench stated that "[r]ule 232 is interesting in that, although it is broadly similar to the process set out in rules 220-224, it does not require preliminary leave of the court to set it down for hearing. One presumes that the consent of the parties is the gatekeeping mechanism which replaces the need to obtain leave: if all parties concur in the process, the court should attempt to accommodate them. Nonetheless, as our Court of Appeal underlined in Amiot, a court could decline to entertain a stated case" - See paragraph 26.

Practice - Topic 5269

Trials - General - Trial of preliminary issues - Evidence - [See first and second Practice - Topic 5260 ].

Practice - Topic 5269

Trials - General - Trial of preliminary issues - Evidence - On January 24, 2002, the vehicle the plaintiff was driving was negligently struck by a Dodge van driven by an employee of Borza Inspections Ltd. - The van had been leased by Borza Inspections from Derrick Dodge (1980) Ltd. - The stated case was whether, at the time of the accident, Derrick was still an owner of the van - The factual disagreement related to the mode of communication concerning the buy-out: there was no direct evidence that Borza Inspections mailed the buy-out cheque to Derrick - The Alberta Court of Queen's Bench, relying on rule 232(2) and on the evidence, drew the inference that the cheque was mailed to Derrick - In light of that finding, the court concluded that the postal acceptance rule applied - On January 22, 2002, when Borza Inspections mailed its cheque to Derrick, it accepted Derrick's offer of a specific buy-out option - The court then went on to determine the issue of title to the van - See paragraphs 32 to 38.

Sale of Goods - Topic 101

General - Application of legislation - General - In the context of this stated case, the Alberta Court of Queen's Bench stated that "the over-riding rule in the [Sale of Goods] Act is that the property in specified goods, or the ownership of them, or the title to them, is transferred from the seller to the buyer at the time that the parties to the contract intend title to be transferred: s. 19(1). This position is further emphasized in s. 20(1) of the Act" - In this case, the court concluded that it was clear from the documents that the parties intended title to be transferred when all sums owing were paid and the Bill of Sale was completed - There was nothing in the Sale of Goods Act which over-rode that intention - See paragraph 47.

Sale of Goods - Topic 2708

Transfer of property in goods from seller to buyer - General principles - Whether title to goods passed to buyer - In the context of a stated case, the Alberta Court of Queen's Bench concluded that title to the van in question had not been transferred at the time of the motor vehicle collision - The court did not rely on two factors raised by the plaintiff, including the potential effect of s. 5(1) of the Traffic Safety Act, for several reasons - First, the Act was not in effect at the time of the collision - Second, s. 5(1) was intended to be used for evidentiary, rather than substantive purposes; i.e., "its main objective is to relieve parties from the cost of requiring an official to testify in person with respect to the state of the register of motor vehicle documents" - Finally, this was not a case in which the court needed to address the policy issues outlined in the Budny v. Senechal (1990) line of cases - See paragraphs 41 to 43.

Sale of Goods - Topic 2708

Transfer of property in goods from seller to buyer - General principles - Whether title to goods passed to buyer - The Alberta Court of Queen's Bench relied on the following five factors in determining that title to the van in question did not pass to the lessor when it mailed its buy-out cheque to the lessee on January 22, 2002, and that title was still in the lessee as of January 24, 2002, the date of the motor vehicle collision: (1) the wording of the lease itself established that title was to remain in the lessee until it transferred the title; (2) the Bill of Sale established that title did not pass until all sums owing were actually paid; (3) the absence of anything in the Sale of Goods Act overriding the intention of the parties as expressed in the lease and in the Bill of Sale; (4) the insurable interest of the parties: if the lessee's contention was correct, as of January 22, 2002, it would not have had an insurable interest in the van, defying the interest of the legislator in codifying the standard approaches to ownership of goods; and (5) it defied common sense that the lessee would give up ownership of its vehicles in defiance of its written agreements and without having been paid - See paragraphs 47 and 48.

Sale of Goods - Topic 2741

Transfer of property in goods from seller to buyer - Intention of parties - General - On January 24, 2002, the vehicle the plaintiff was driving was negligently struck by a van driven by an employee of Borza Inspections Ltd. - The van had been leased by Borza Inspections from Derrick Dodge; however, on January 22, 2002, Borza Inspections had mailed a cheque purportedly in satisfaction of the lease's buy-out option - The lease expired on January 26, 2002 - The Alberta Court of Queen's Bench disagreed with the plaintiff's position that, until January 26, 2002, there could not have been any transfer of title - "[A]ccording to normal principles of contract law, the parties to the contract are able to consent to changes in the contract" - On the facts of the case, according to the Bill of Sale, Derrick was prepared to have terminated the lease prior to January 26, 2002 - However, as the other relevant facts established, that willingness was never put into effect - See paragraphs 44 to 46.

Cases Noticed:

Somersall v. Friedman et al., [2002] 3 S.C.R. 109; 292 N.R. 1; 163 O.A.C. 201, refd to. [para. 7].

Hayduk v. Pidoborozny, [1972] S.C.R. 879, refd to. [para. 7].

Alas v. Solis et al. (2001), 288 A.R. 396; 2001 ABQB 688, refd to. [para. 7].

Mahan v. Hindes et al. (2001), 308 A.R. 1; 2001 ABQB 831, refd to. [para. 7].

Alas v. Solis (2003), 327 A.R. 192; 296 W.A.C. 192; 2003 ABCA 137, refd to. [para. 7].

Ford Credit Canada Ltd. v. Solis - see Alas v. Solis.

Ezzedine v. Dalgard et al. (2006), 405 A.R. 296; 2006 ABQB 826, refd to. [para. 7].

McKay Estate v. Barrett et al. (2001), 285 A.R. 374; 2001 ABQB 81, refd to. [para. 7].

Westrop-McKay v. Barrett - see McKay Estate v. Barrett et al.

Budny v. Senechal, [1990] O.J. No. 2396 (Gen. Div.), refd to. [para. 7].

Crane et al. v. Brentridge Ford Sales Ltd. et al. (2007), 436 A.R. 22; 2007 ABQB 669, refd to. [para. 7].

Bois Estate v. McDonald, [1975] A.J. No. 324 (C.A.), refd to. [para. 7].

Sanders v. Hedman (1915), 8 W.W.R. 664 (Alta. C.A.), refd to. [para. 8].

Laratta v. Peace Hills General Insurance Co. (1999), 243 A.R. 131; 1999 ABQB 203, refd to. [para. 8].

Hammerton v. MGM Ford-Lincoln Sales Ltd. (2007), 239 B.C.A.C. 90; 396 W.A.C. 90; 2007 BCCA 188, refd to. [para. 8].

Predator Corp. v. Ricks Nova Scotia Co., [2001] A.J. No. 1651 (Q.B.), refd to. [para. 8].

Irving Industries (Irving Wire Products Division) Ltd. et al. v. Canadian Long Island Petroleums Ltd. and Sadim Oil & Gas Co., [1975] 2 S.C.R. 715; 3 N.R. 430, refd to. [para. 8].

Mitsui & Co. (Canada) Ltd. v. Royal Bank of Canada et al., [1995] 2 S.C.R. 187; 180 N.R. 161; 142 N.S.R.(2d) 1; 407 A.P.R. 1, refd to. [para. 8].

Saskatchewan River Bungalows Ltd. and Fikowski v. Maritime Life Assurance Co. (1992), 127 A.R. 43; 20 W.A.C. 43; 92 D.L.R.(4th) 372 (C.A.), refd to. [para. 8].

Colosimo v. Merkel, [1985] O.J. No. 622 (H.C.), refd to. [para. 8].

Jerome v. Clements Motor Sales Ltd. (1958), 15 D.L.R.(2d) 689 (Ont. C.A.), refd to. [para. 8].

Barkley v. Wheldrake et al. (1975), 7 O.R.(2d) 585 (H.C.), refd to. [para. 8].

August Leasing Ltd., Re (1978), 18 A.R. 338 (Dist. Ct.), refd to. [para. 8].

Widdis v. Hall (1994), 21 O.R.(3d) 238 (Gen. Div.), refd to. [para. 8].

Amiot v. Co-operators General Insurance Co. (2001), 281 A.R. 170; 248 W.A.C. 170; 2001 ABCA 116, refd to. [para. 9].

Statutes Noticed:

Highway Traffic Act, R.S.A. 1980, c. H-7, sect. 181 [para. 20].

Rules of Court (Alta.), rule 220 [para. 15]; rule 232 [para. 16]; rule 236(6) [para. 17].

Sale of Goods Act, R.S.A. 2000, c. S-2, sect. 19 [para. 18].

Traffic Safety Act, R.S.A. 2000, c. T-6, sect. 5(1) [para. 19].

Counsel:

Kevin P. Feehan, Q.C. (Fraser Milner Casgrain LLP), and Andrea Jarman (student-at-law) (Fraser Milner Casgrain LLP), for the plaintiff, Richard Darrell Gablehouse;

Jerri L. Cairns (Parlee McLaws LLP), for the defendant, Derrick Dodge (1980) Ltd.

This stated case was heard on May 4, 2010, by Veit, J., of the Alberta Court of Queen's Bench, who delivered the following judgment and reasons for judgment, dated May 30, 2010, at Edmonton, Alberta.