[2016] 3 F.C.R. D-12
Maritime Law
Limitation of liability — In action taken by plaintiff wherein decision rendered (2016 FC 69), supplemental reasons issued pertaining to limitation of liability of defendants Maritime Marine Consultants (2003) Inc. (MMC), Donald Bremner, owner thereof (collectively defendants) pursuant to Art. 1(4) of Convention on Limitation of Liability for Maritime Claims, 1976, as amended by the Protocol of 1996 to amend the Convention on Limitation of Liability for Maritime Claims, 1976, being Schedule 1 of the Marine Liability Act, S.C. 2001, c. 6 — Whether defendants entitled to benefit of limitation pursuant to Art. 1(4) of Convention — Having to determine whether defendants herein constituting “persons” pursuant to Art. 1(4) for whose act, neglect or default plaintiff, as shipowner, responsible, thereby entitling defendants to limit liability — Plaintiff, “shipowner” as defined by Art. 1(2) of Convention — Defendants arguing constituting “persons” under Convention; that Art. 1(4) extending class of persons entitled to limit liability to include independent contractors, provided shipowner responsible for actions of independent contractor as matter of law — MMC contracting with plaintiff to provide naval architecture services for subject cargo move — Plaintiff, MMC having longstanding relationship, MMC providing expertise plaintiff not having — Defendants also providing advice on suitability, use of “SPM 125” (barge) for safe loading, transport of LP rotors — However, factual evidence not sufficient to make defendants “persons” for whose act, neglect or default plaintiff as shipowner “responsible”, entitling defendants to avail themselves of Art. 1(4) limitation — MMC independent corporate entity, not division of plaintiff — No evidence Bremner retained by plaintiff in personal capacity or employee thereof or acting other than as principal of MMC — Rather, MMC acting as independent contractor in providing naval architectural services to plaintiff — Relationship of employer, independent contractor typically not giving rise to claim for vicarious liability — In present case, evidence showing that plaintiff entering into contract for services with MMC; that MMC providing naval architectural services that plaintiff not having in–house; that plaintiff not supervising or controlling MMC’s work; that MMC independent corporate entity doing business on own account — In brief, nature of relationship between plaintiff, MMC not one attracting vicarious liability — Therefore, while MMC may have been retained by plaintiff in past for architectural services, not sufficient under Canadian law to make plaintiff vicariously liable or responsible for MMC’s acts or omissions — Thus, mere fact that plaintiff contracting with MMC to provide naval architectural services considered necessary part of cargo move insufficient to find legal responsibility as described by Art. 1(4) of Convention — Given ambiguity arising from wording of Art. 1(4), various possible interpretations thereof, The Travaux Préparatoires of the LLMC Convention, 1976 and of the Protocol of 1996 (travaux) examined — However, while travaux providing no clear answers, interpreted as not explicitly intending to extend category of persons entitled to limit liability pursuant to Art. 1(4) to include independent contractors — Travaux suggesting that underlying premise of Art. 1(4) being that “responsibility” remaining tied to vicarious liability of shipowner, that narrow interpretation intended — Accordingly, because category not intending to extend to include independent contractors, because plaintiff as shipowner not vicariously liable for acts, neglect or default of independent contractor, defendants not entitled to limit liability pursuant to Convention — To achieve policy goals, Convention in particular facilitating shipowners obtaining favourable insurance rates by making liability amounts predictable based on amount of limitation — Convention also capping claimant’s recovery, thereby encouraging quick resolution without litigation — Unclear that policy underlying limitation intended to extend to independent contractors who, presumably, are capable of obtaining own insurance or entering into contractual terms with shipowners to address any risks, liability potentially arising from goods or services contractors providing in connection with ship — Consequently, Art. 1(4) not intended to extend right to limit liability to independent contractors such as MMC — In summary, defendants as independent contractors not persons for whose acts, neglect or default plaintiff, as shipowner, responsible pursuant to Art. 1(4) of Convention — Accordingly, defendants not entitled to limit liability pursuant to Convention.
J.D. Irving, Limited v. Siemens Canada Limited (T-520-10, 2016 FC 287, Strickland J., judgment dated March 7, 2016, 23 pp.)