Canadian Business and The Law Canadian 6th Edition Duplessis Solutions Manual 1

Enriched Instructor’s Manual—Answers to accompany Canadian Business and the Law, 6th edition Chapter 10
Canadian Business and the Law Canadian 6th Edition Duplessis
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Chapter 10
Introduction to Tort Law
Instructor’s Manual–Answers
by Shannon O’Byrne
I. TEACHING OBJECTIVES
After studying this chapter, students should have an understanding of
 the broad scope of tort law
 the difference between a civil action and a criminal action
 the purpose of tort remedies
 how business can manage its potential liability in tort
© 2016 Nelson Education Limited 10-1

This chapter provides an introduction to the role and purpose of tort law as it relates to the
business environment. To this end, it defines tort law, distinguishes it from criminal law,
discusses the nature of liability in tort, and provides an introduction to the kind of damages that
are recoverable in a tort action. Consistent with the theme of the book, this chapter also
emphasizes the importance of managing tort risk.
With this introductory chapter in place, students are in a better position to learn about the
specific torts that apply to business. This is accomplished in Chapters 11 and 12 of the textbook.
II. TEACHING STRATEGIES
Students generally enjoy learning tort law, perhaps because fact situations giving rise to tortious
liability are inherently interesting. Instructors find that it is simple to spark class discussion.
It is critical that students understand the fault-based nature of torts at common law and why,
therefore, not every loss or injury will result in a successful tort claim. In both examples in the
textbook on page 226, for instance, the vehicle owner has suffered an identical loss but in a
common law jurisdiction unaffected by legislation on point, the owner will only be able to
recover in the first instance.
To help students conceptualize how tort law affects operations, this chapter follows the
traditional strategy of distinguishing between intentional torts and the tort of negligence. It is
helpful to emphasize that the majority of tortious liability faced by a business is likely to be in
negligence (perhaps concurrently with an action for breach of contract). It is less common for
businesses to commit intentional torts.

III. STUDENT ACTIVITIES
Task 1: In Chapter 3 of this Instructor’s Manual, under Student Activities, students are asked to
choose a business and apply the risk management process to it. This assignment can be
reintroduced at this point, with students being asked to assess a business in relation to its risk for
tort liability. The students can do a risk analysis and apply to it the knowledge of torts as they
acquire it. For a comprehensive analysis of a larger version of this kind of study assignment, see
D. DuPlessis and S. Gunz, “Legal risk assessment exercise” (1997) 15 JLSE 153.
Task 2: To help students grasp the distinction between tortious and criminal liability (see Figure
10.1 on page 230 of the textbook) ask them to consider the following statement: “Victims of
crime should not be permitted to sue the defendant in tort. The defendant should not be punished
twice.”
Many students will disagree with this statement and, in fact, the statement may well provoke
them. All to the good. The ensuing discussion will help the class to see that what criminal law
accomplishes (and the interests it protects) is distinct from what tort law accomplishes (and the
interests it protects). Alternatively, or in addition, the instructor may want to relate discussion to
the Business Application of the Law on page 234 of the textbook, which, among other matters,
discusses the punitive damages awarded against Exxon in a civil class action suit. In addition to
being subject to a successful civil action described in the box, Exxon was indicted by the U.S.
federal government on five criminal charges with potential penalties totalling $5 billion. The
company soon agreed to plead guilty to three counts with a fine of $25 million, or less than

1 percent of the total potential criminal fine, plus $900 million in civil fines to be paid over
10 years. In addition, the company paid $2.1 billion in cleanup costs and several hundred million
dollars more to fishermen for their lost summer catch. In all, the company paid $3.4 billion. See
Nina Totenberg, “Supreme court weighs Exxon Valdez damages,” NPR (27 February 2008),
online: NPR <http://www.npr.org/templates/story/story.php?storyId=48308288>.
Students might be asked to address the distinct rationales for Exxon being subject to so much
legal liability and what the alternatives are, if any.
IV. EXPLANATION OF SELECTED FEATURES
Page 226
Case: Fullowka v Pinkerton’s of Canada Ltd, [2010] 1 S.C.R. 132
Critical Analysis: Do you agree with the Supreme Court of Canada’s analysis?
The issue that this box implicitly emphasizes is that tort law compensates on the basis that the
defendant has conducted itself on a blameworthy basis or, in the language of tort law, has failed
to exercise reasonable care. This means that if the defendant did nothing wrong—if it did use
reasonable care—then it should not have any legal responsibility to the families of the murdered
deceased even though the circumstances are tragic and heart-breaking. The Supreme Court of
Canada was correct to rule that Pinkerton’s was hired to use reasonable care in preventing
trespassers from accessing the mine, not to guarantee a result.
Discussion can be left at this level of generality but it may be worth noting that the
families of the deceased had received compensation from the WCB so they are not left without

compensation altogether. See footnote 8 on page 227 of the text for a brief account of the WCB
context to this case.
Workers’ Compensation schemes are briefly described later in the chapter but essentially, it
means that the surviving families of the murdered workers received compensation from the WCB
because their loved ones were killed on the job. The WCB scheme in place at the time of the
litigation would potentially permit the families to recover additional compensation from third
parties like Pinkerton’s (versus the employer) but it would also have to reimburse the WCB first.
It is suggested that any discussion of subrogation not be expanded beyond this point.
Page 227
Photo caption: The law requires employers to keep the workplace safe. How can the
risks of a workplace accident be managed?
A business should seek to make workplace safety an important aspect of the corporate culture.
Part of this process would include taking an inventory of workplace dangers and seeking to
reduce or eliminate risks associated with those dangers. For example, the photo illustrates the
risk of worker injury due to improper use of a ladder.
According to the law firm Parsons & Associates, the risk management steps a business can
take to avoid ladder-related injury include as follows:
 “Make sure that the area is barricaded before you get on the ladder, to avoid the
possibility that other workers may walk into the ladder when it is in use.
 Walk up the ladder carefully, holding on to the rungs, and maintain three points of contact
on the ladder at all times.

 Avoid walking up a ladder holding objects in your arm. Use your tool belt, or hoist
materials to get around this problem.
 Wear sturdy, comfortable boots with slip-resistant soles while climbing a ladder. Avoid
climbing a ladder while wearing wet, muddy shoes.
 Inspect overhead for all electrical lines before setting up a ladder.
 Place the ladder on dry terrain that has high traction and not on a slippery surface.
 Set the ladder angle correctly.”
See: Parsons & Associates, “How to Prevent Workplace Ladder Injuries” (undated document),
online: < http://www.parsonslawgroup.com/how-to-prevent-workplace-ladder-injuries.html>.
For an even longer list of ladder safety tips, see the Texas Department of Insurance, “Ladder
Safety” (undated document), online: Texas Department of Insurance,
<https://www.tdi.state.tx.us/pubs/videoresource/t5laddersafe.pdf>, including this one:
“Don’t lean out to the side when you are on a ladder. If something is out of reach, get down and
move the ladder to the work area.” Note that the Canada Safety Council offers a course on ladder
safety. See <https://canadasafetycouncil.org/training/ladder-safety-training-course>.
Page 232
Business and Legislation: Workers’ Compensation
Critical Analysis: Should employees be deprived of their right to sue their employer
when that employer has been in the wrong and caused the employee’s injury?

Unlike the tort system at large which is fault based, WCB compensation is based on a no-fault
scheme. As summarized by Lewis Klar in Tort Law 5th ed (Toronto: Thomson Reuters, 2012)
at 21:
The basic premise of no-fault is that those who have been disabled due to injury,
and by extension, disease, should be financially assisted, rehabilitated and, if
necessary, retrained, without regard to the cause of their disability. No-fault
programs [such as the WCB] do not distinguish among victims of accidental,
negligent or deliberate conduct which results in the disability either in terms of
eligibility or quantum of benefits.
This means that all employees injured on the job receive compensation even if they themselves
were the sole cause of their own injuries. Under a WCB scheme, the employee trades her cause
of action against the employer (which may or may not have proven successful) for guaranteed
compensation regardless of fault, albeit at a level that might fall below what a court might
otherwise award.
Under the law of negligence, by way of contrast, an injured employee has to prove that her
injury was caused by the negligent or other tortious conduct of the employer. Failure to do so
would leave the injured worker without compensation in face of great potential need.
Page 233
Caption: Dennis Schulz was catastrophically injured at a Bon Jovi concert. Schutz
alleges that several people starting fighting in the stands and one of them ended up
falling on him from above, breaking his neck and resulting in quadriplegia. What kinds
of damages should Schultz seek and why? [footnote deleted]

Dennis should seek both pecuniary and non-pecuniary damages. His pecuniary damages would
include cost of future care, loss of future income, and special damages for out of pocket expenses
resulting from the injury-causing event. His non-pecuniary damages would include pain and
suffering, loss of enjoyment of life, and loss of life expectancy. Depending on the facts proven at
trial, Dennis may also be entitled to punitive damages.
According to press accounts, Dennis Schulz is seeking $7 million for medical care. Schulz’s
lawyer, Patrick Phelan, was reported as anticipating a trial date in 2010 or 2011. Phelan said that
his client “prefers not to talk to reporters but added that ‘his attitude is excellent,’ especially
considering the circumstances. How would you feel if you had no motion in your arms and legs?”
See CBC News, “Edmonton man left quadriplegic after Bon Jovi Concert awaits day in
court” (9 January 2009) at <http://www.cbc.ca/news/arts/music/story/2009/01/08/bon-jovi.html>.
Page 234
Business Application of the Law: Punitive Damages in the United States and Canada
Critical Analysis: Do you think that Canada should follow the approach taken by the
U.S. Supreme Court or do you prefer the flexibility of the Canadian approach? Would
it be a good idea just to set a fixed dollar amount as a maximum and not worry about
ratios or word descriptors?
Students will know from the media that punitive damages awards in the U.S. can be spectacularly
large. What follows is a portion of the U.S. Supreme Court’s analysis of punitive damage in the
Exxon case, which it concludes by noting, “Despite these limitations, punitive damages overall
are higher and more frequent in the United States than they are anywhere else.” In the words of
the U.S. Supreme Court,

State regulation of punitive damages varies. A few States award them rarely, or not at
all. Nebraska bars punitive damages entirely, on state constitutional grounds…Four
others permit punitive damages only when authorized by statute: Louisiana,
Massachusetts, and Washington as a matter of common law, and New Hampshire by
statute codifying common law tradition…. Michigan courts recognize only
exemplary damages supportable as compensatory, rather than truly punitive…while
Connecticut courts have limited what they call punitive recovery to the “expenses of
bringing the legal action, including attorney’s fees, less taxable costs.”
As for procedure, in most American jurisdictions the amount of the punitive award is
generally determined by a jury in the first instance, and that “determination is then
reviewed by trial and appellate courts to ensure that it is reasonable.” … Many States
have gone further by imposing statutory limits on punitive awards, in the form of
absolute monetary caps, see, e.g., Va. Code Ann. §8.01–38.1 (Lexis 2007) ($350,000
cap), a maximum ratio of punitive to compensatory damages, see, e.g., Ohio Rev.
Code Ann. §2315.21(D)(2)(a) (Lexis 2001) (2:1 ratio in most tort cases), or,
frequently, some combination of the two, see, e.g., Alaska Stat. §09.17.020(f) (2006)
(greater of 3:1 ratio or $500,000 in most actions). The States that rely on a multiplier
have adopted a variety of ratios, ranging from 5:1 to 1:1. [footnotes deleted.]
To read the full decision, go to <http://www.supremecourt.gov/opinions/07pdf/07-219.pdf>. See
too Mark B. Greenlee, “Kramer v. Java World: Images, issues, and idols in the debate over tort
reform” (1997) 26 Cap UL Rev 701 for an analysis of the Liebeck case (involving McDonald’s
hot coffee) and the myths surrounding it. The Liebeck case is also discussed in the Business
Applications of the Law: Punitive Damages in the United States and Canada box feature on
page 231 of the textbook.
Canada’s approach to punitive damages is considerably more measured and controlled than
what generally occurs in the United States. This is due, most recently, to the Supreme Court of
Canada’s pronouncements in Whiten (also referenced in the Punitive Damages in the United
States and Canada box). The Canadian perspective insists on proportionality between the
defendant’s conduct and the defendant’s punishment via a damages award, thereby seeking to
accord quantification with principles of justice. It conscientiously tries to make the award about
punishing the defendant in a reasonable way, not about granting a lottery win to the plaintiff.

Simply setting a fixed dollar amount for punitive, regardless of circumstances, is a problem
because, as the U.S. Supreme Court notes, there is no “standard” tort or contract injury. On what
basis, then, could a judge fashion a “standard” tort or contract punitive award (at 33 of the
decision).
For further discussion of the Whiten case, see Chapter 28 (Insurance) of the text.
Page 234
Photo caption: Should the defendant’s ability to pay be a consideration in the awarding
of punitive damages?
This has to be a factor since the award must punish the defendant. A small punitive damages
award against a large corporation would contain no sting.
Page 235
Photo caption: How can business avoid being ordered to pay punitive damages?
Since punitive damages are about proportional punishment for egregious behaviour, a business
can avoid punitive damages by avoiding conduct that would trigger such a judicial response. A
legal risk management plan—which eliminates, reduces, or transfers risk—would also go a long
way to managing the risk of punitive damages. See the Managing Tort Risk section on page 238
of the textbook. These steps will also assist a business in avoiding punitive damages.
For example, insurance companies (including the insurer in the Whiten case) face punitive
awards for denying cover to the insured by, for example, wrongly alleging arson. Employees of
insurance companies need to understand that their conduct—including making groundless

allegations—can have serious consequences for their employer when the matter is litigated. On a
related front, spreading defamatory falsehoods is also an occasion ripe for punitive damages,
perhaps in a wrongful dismissal context. Ask students to come up with other examples of how
egregious conduct by a business might lead to punitive damages in tort and how a company can
ensure that such conduct does not occur.
Page 236
Business Application of the Law: Steve Moore’s tort action against Todd Bertuzzi
Critical Analysis: In what way do the criminal and civil actions against Bertuzzi
overlap? In what way are they distinct?
For context, the instructor may decide to show the CBC video clip (contained on the CD
accompanying the text), which offers a brief account and footage of the actual on-ice attack
against Moore.
The criminal and civil actions against Bertuzzi overlap because the same course of conduct—
his attack on Moore—gave rise to two legal consequences, one in tort pursuant to civil law and
one under the Criminal Code. Differences arise, however, in what must be proven to establish
the wrong in question, by whom, and to what standard.
The Criminal Action: Bertuzzi pled guilty to a charge of assault causing bodily harm but
otherwise the Crown would have had to have proven beyond a reasonable doubt that Bertuzzi
committed the crime as charged. The relevant Criminal Code provision states:

267. Every one who, in committing an assault,
(a) carries, uses or threatens to use a weapon or an imitation thereof, or

(b) causes bodily harm to the complainant,
is guilty of an indictable offence and liable to imprisonment for a term not

exceeding ten years or an offence punishable on summary conviction and liable to
imprisonment for a term not exceeding eighteen months.
In a trial of such a charge, the Crown would have to establish that the force was applied by
Bertuzzi, that it was intentional, and that the actions caused bodily harm to Moore. The Crown
would have to establish that Moore was not the aggressor or even if Moore were the aggressor,
that the response from Bertuzzi was not reasonable in light of Moore’s actions. There is no
suggestion on the facts that Moore was anything but a victim in the attack.
The Civil Action: In the civil action based in tort, the plaintiff, Moore, has to show on a balance
of convenience that all the ingredients of the alleged tort occurred. For example, to establish the
tort of battery, the injured party, Moore, must prove that Bertuzzi is responsible for the tort on
the balance of probabilities. As discussed in Chapter 10, battery is the intentional infliction of
harmful or offensive physical conduct.
Figure 10.1 on page 230 provides a brief synopsis of the differences between a civil and
criminal action.
V. CHAPTER STUDY
Questions for Review, page 240
1. What does the term “tort” mean?

The word tort describes any harm or injury caused by one person to another—other than through
breach of contract—and for which the law provides a remedy. A tort is a wrong to another
person; in particular, it is the interference with another’s person, property, or reputation.
2. Give an example of a tort.
Any example of a tort is acceptable. On page 225 of the text there are a number of examples:
 Parking garage operators might rely on the tort of trespass when drivers leave their cars in
the lot but fail to purchase the required ticket.
 A customer purchases a vehicle based on the vendor’s intentional representation that the
vehicle has a new engine when, in fact, it does not.
 When a bar over-serves a customer, it may be found negligent if that intoxicated customer
is injured or causes injury to others.
3. What are the two main categories into which torts are organized?
The two categories of torts are those committed intentionally and torts committed through
negligence or unintentional torts.
4. Why does the law require employers to maintain a safe workplace?
Employers owe a duty of care under tort law (as well as under the contract of employment) to
take reasonable care of their employees. This is based, in part, on simple negligence law and
reflects, more generally, the acknowledged vulnerability that employees face in the workplace.
According to Lewis Klar:

There are several…formal relationships which involve duties of assistance or protection. One
of the clearest examples of a relationship which involves a right of one person to control the
behaviour of another is the employer-employee relationship. Concomitant with this right to
control is the obligation to protect. . . . The employer is required to exercise reasonable care to
ensure the safety of the employee. It has also been held that the duty owed by an employer to
its employee to provide safe working conditions cannot be delegated to third parties. (See
Lewis Klar, Tort Law (Toronto: Thomson-Reuters, 2012) at 21.
As discussed in Chapter 10, courts have found that employers owe an “overriding managerial
responsibility” to protect employees and to safeguard them from an “unreasonable risk of
personal injury while on duty.” See Hunt v Sutton Group Incentive Realty Inc (2001) 52 OR (3d)
425 (Sup Ct Just) rev’d on other grounds (2002, 215 DLR (4th) 193 (CA).
5. The goals of tort and criminal law are quite distinct, even when they stem from the
same event. Explain the differences.
The purpose of criminal law is to sanction behaviour and secure punishment of the perpetrator.
The purpose of tort law to compensate the victim for harm suffered because of the culpability of
another person.
6. What is a joint tort-feasor?
A joint tort-feasor is someone who, along with one or more others, causes the plaintiff to suffer
loss or injury.
7. What does burden of proof mean?
The burden of proof refers to having the obligation of proving the case.
8. How does the burden of proof differ between a criminal case and a tort action?

In criminal cases, the burden of proof is carried by the Crown prosecutor. In a tort action, the
plaintiff carries this burden. Note that the standard of proof in a criminal prosecution is beyond a
reasonable doubt while the standard of proof in a tort action is on the balance of probabilities.
9. What is the difference in the way tort and criminal actions are initiated?
In general, criminal actions (against the accused) are prosecuted by the Crown. In tort law, the
civil suit or action is brought by the victim (plaintiff) against the perpetrator (defendant).
10. What is the purpose of damages in tort?
The primary purpose is to provide financial compensation for the harm caused to the plaintiff by
the defendant’s culpable conduct.
11. Under what circumstances might an injunction be awarded in tort?
An injunction or order to desist from a certain action would be made where financial
compensation would not provide an adequate remedy for the harm done, as in a trespass
situation, for example.
12. Vicarious liability is an essential feature of modern tort law. What is it?
Vicarious liability is the liability of the employer for the tortious acts of an employee committed
in the usual or ordinary course of employment.
13. What might be a defence to a claim for vicarious liability?

A defence to a claim of vicarious liability is that the event did not arise out of the normal course
of employment, that the employee’s conduct was not sufficiently related to the conduct
authorized by the employer.
14. How does contributory negligence affect the amount of damages a plaintiff may
receive?
If the defendant uses the defence of contributory negligence, the amount of damages that the
plaintiff is awarded is reduced by the proportion for which the plaintiff is responsible.
15. Explain the difference between pecuniary and non-pecuniary damages.
Pecuniary damages provide compensation for out-of-pocket expenses, loss of future income, and
cost of future care. Non-pecuniary damages provide compensation for pain and suffering, loss of
enjoyment of life, and loss of life expectancy.
16. How are pecuniary damages typically calculated?
Pecuniary damages are calculated through evidence of actual out-of-pocket expenses; expert
testimony of future financial losses, such as those that arise because of loss of future income; and
expert testimony as to what it will cost to care for the plaintiff in the future, given the injuries
sustained at the hands of the defendant.
17. What are punitive damages? How are they different from aggravated damages?
Punitive damages are an exception to the general rule that damages are intended only to
compensate the plaintiff. Punitive damages are awarded to punish the defendant for malicious,

oppressive, and high-handed conduct. Aggravated damages compensate the plaintiff for
intangible injuries, such as distress and humiliation caused by the defendant’s reprehensible
conduct.
18. When is overlapping liability in tort and contract common?
Such liability is common when a professional gives negligent advice to her client since this is
both a breach of contract and a tort.
Questions for Critical Thinking, page 240
1. What are the justifications for the basic legal principle that the standard of proof is
higher in a criminal matter than in a civil one?
Because someone convicted of a criminal offence stands to lose her freedom via imprisonment,
the Canadian legal system places a higher standard of proof than in a civil suit. This also means
that someone guilty of a crime may nonetheless be set free because the Crown could not prove its
case beyond a reasonable doubt. However, this is the bargain the Canadian justice system has
made to try to prevent wrongful convictions. A related reason for a higher standard in a criminal
matter is the stigma of a criminal conviction.
Note too that even with the higher standard, the innocent are sometimes convicted by the
Canadian criminal justice system. For recent analysis of such injustices, see Kent Roach,
“Wrongful convictions in Canada” (2011) SSRN at
<http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1887889>. One of the case studies Roach
focuses on that of Tammy Marquardt, “a young single mother from Ontario who was imprisoned

for 13 years for the murder of her two-and-one-half-year son on the basis of erroneous forensic
pathology expert testimony that the cause of her son’s death was asphyxia.” For other famous
examples, see the entry under “wrongful convictions” in the Canadian Encyclopedia Wrongful
Convictions—The Canadian Encyclopedia (2015), online: Canadian Encyclopedia
<http://www.thecanadianencyclopedia.ca/en/article/wrongful-convictions/>. See too CP03 (QL)
(21 March 2003) in “Crime murder quicklist” and CP02 (QL) (12 November 2002) in “Wrongful
conviction quicklist” as follows:
 Gregory Parsons (Newfoundland and Labrador): Wrongfully convicted of murdering his
mother in 1991 and exonerated in 1998. The Newfoundland and Labrador government
apologized and awarded him $650 000 in compensation. (Note: in March, 2003, the
Newfoundland and Labrador government announced a public inquiry into its justice
system, precipitated by three high-profile murder cases that led to wrongful convictions.
The inquiry was headed by Antonio Lamer, a retired chief justice of Canada. Justice
Lamer submitted his report in 2006, as described in a press release by the Newfoundland
and Labrador government at
<http://www.releases.gov.nl.ca/releases/2006/just/0621n03.htm>.
 Thomas Sophonow (Manitoba): Wrongfully convicted in 1981 for murder; spent four
years in jail. A judicial inquiry recommended an award of $2.6 million as compensation.
 Michael McTaggart (Ontario): Wrongfully convicted of bank robbery; spent two years in
jail. Awarded $230 000 in a civil suit.
 David Milgaard (Saskatchewan): Wrongfully convicted of murder; spent 23 years in
prison from the age of 16. Awarded $10 million.

 Guy Paul Morin (Ontario): Wrongfully convicted of killing a nine-year-old girl; spent
two years in prison. Awarded $1.25 million.
 Benoit Proulx (Quebec): Wrongfully convicted of slaying his ex-girlfriend; spent two
years in prison. Supreme Court awarded him $2.2 million.
 Donald Marshall (Nova Scotia): Wrongfully convicted of murder; spent 11 years in
prison. After legal fees were paid, he received less than $200 000 in compensation. CP
notes that in 1990, a royal commission ordered he be paid a lump sum of $200 000 and a
lifetime pension worth $3 million if he lives to 65.
 Clayton Johnson (Nova Scotia): Wrongfully convicted of killing his wife; spent five years
in prison. He received a settlement of $2.5 million in 2004. See CBC News, “N.S. to pay
$2.5 million to man wrongfully convicted of his wife’s murder” (18 June 2004).
There is no doubt that this list would be even longer but for the higher burden of proof in a
criminal matter.
2. Punitive damages are somewhat controversial even in jurisdictions where they are
relatively common. At the same time, there are circumstances in which a person’s
tortious actions have been particularly callous and calculating, yet the actual loss
suffered by the plaintiff is not extensive in monetary terms. In these latter cases,
what are the compelling reasons for allowing the plaintiff additional compensation
over and above her actual loss? Should the compensation principle of tort law be
compromised in this way?
Given that the Canadian approach to punitive damages has been reasonably measured and
moderate, there is a strong argument that any compromise of the tort principle of compensation

has been small. It is also important that the Canadian judiciary retain some way of correcting and
punishing the particularly egregious defendant whose conduct has perhaps fallen short of a crime
but is still tremendously objectionable.
In defence of punitive damages in a civil context, the class might be interested in learning
that the Supreme Court of Canada in the 2002 Whiten decision focused on the importance of
proportionality and expressly directed lower courts to consider the defendant’s blameworthiness
in relation to specific factors. The court is intent on restraining the size of punitive awards
though, in Whiten, a record $1 million in punitives was affirmed. The following table outlines
factors to consider. It draws heavily on the exact words used by the court.

Proportionality: Setting the quantum

1. The proper award must be proportionate to the blameworthiness of the defendant’s
conduct. In assessing blameworthiness, determine, inter alia,
 whether the defendant’s conduct was planned and deliberate
 the defendant’s intent and motive
 whether the defendant persisted in the outrageous conduct over an extended period
 whether the defendant conceded or attempted to cover up its misconduct
 whether the defendant was aware that what he or she was doing was wrong
 whether the defendant profited from its misconduct
 the interest violated by the misconduct was known to be deeply personal to the
plaintiff (e.g., professional reputation as in Hill).
2. The proper award must be proportionate to the level of the plaintiff’s vulnerability,
including financial or other vulnerability.
3. The proper award must be proportionate to the harm or potential harm directed
specifically at the plaintiff.
4. The proper award must be proportionate to the need for deterrence.
5. The proper award must be proportionate, even after taking into account the other
penalties—both civil and criminal—that have been or are likely to be inflicted on the
defendant for the same misconduct.
6. The proper award must be proportionate to the advantage wrongfully gained by the
defendant from the misconduct.
3. The concept of vicarious liability developed in the business world, where the
company is out to make a profit and its activities are for the most part directed to
generating profit. Is it appropriate to apply a test developed in this context to a
charitable organization? What are the pros and cons for holding organizations
liable for the conduct of their employees?

When charitable organizations deliver services—such as providing care for children, as in the
Bazley case—Canadian law would be deficient not to hold them to the same standard as anyone
else delivering a service. Though charities are to be valued and respected for their contribution to
the community, when they deliver a service tortiously, there is good reason to hold the
organization accountable. Two goals would be to provide compensation to the victim and to
provide a general incentive for charitable organizations to do their charitable work in a careful,
competent, and non-tortious fashion.
4. Does the idea of contributory negligence reflect the major aims and purposes of tort
law? Does it make sense to reduce the amount of damages available to a plaintiff,
when he may not have suffered the loss to the same extent, or at all, but for the
negligence of someone else?
Yes. The purpose of tort law is to hold accountable those who cause injury or harm to others by
their negligence. The duty of care and standard of care are concepts that apply to everyone. It
does make sense to reduce the amount of damages available to a plaintiff when he may not have
suffered the loss to the same extent, or at all, but for the negligence of someone else. The
damages sustained would not have been as great or may not have been suffered at all if it was not
for the actions of the plaintiff. If people are the author of their own misfortune, they must be
accountable either fully or partially depending on the circumstances.
5. Do you think that a tort action like Steve Moore’s (discussed in this chapter on page
236) helps to make the game of hockey safer? How?

The law of tort permits a plaintiff like Moore to extract a measure of accountability from
defendants like Bertuzzi (and his hockey club) based on culpability. Bertuzzi is held financially
responsible for the consequences of his egregious misconduct. The lawsuit also publicly
highlights when someone’s behaviour has crossed the line and may well have a positive influence
on the behaviour of hockey players going forward. Who wants to be compared to Bertuzzi in the
future? This stigma, in turn, makes the game of hockey safer.
6. Negligence law requires a security company like Pinkerton’s to show reasonable
care in the provision of services (as discussed in this chapter on page 226). Is this
standard too low, particularly in the context of a violent workplace strike?
The law of negligence requires that the defendant takes reasonable care in conducting its business
but that it not assume the position of a guarantor. Accidents can happen; bad things can occur
without it being the fault of any of the named defendants. Tort law demands accountability but
only in the context of culpability.
Situations for Discussion, page 241
1. Jason attended a beach party with his friends. At the end of the evening, he and his
friends started walking back to their cars when Jason realized he had left his
sandals behind at the beach. He went back to retrieve them but unfortunately, was
randomly attacked by a group of young men who encircled him and beat him
viciously. Jason lost consciousness and awoke again in the hospital. As a result of
the vicious, unprovoked attack, Jason suffered serious physical injury and great

emotional trauma. Jason is now suing the men who had attacked him for the tort of
battery, which is defined as the intentional infliction of harmful or offensive
physical contact. Assume that Jason can prove that the tort of battery took place.
Do you think a court will award Jason aggravated damages given the circumstances
of his attack? What about punitive damages? Explain. [footnote deleted]
This Situation for Discussion is based on Merrick v Guilbeault 2009 NSSC 60. The judge in that
case stated:
[47] I have reviewed the evidence and, as noted above, I have found that this attack
was mindless, unprovoked and resulted in emotional distress and humiliation to the
plaintiff. The plaintiff did not want to show his parents his weakness, and he felt that by
doing so that he had let them and his friends down. While giving evidence he required
time to regain his composure when he thought of the attack and the resulting helplessness
that he felt. On the night of the attack, he was seen by his parents in an extremely
vulnerable state, covered in blood and bruises. Over the following years, his parents and
girlfriends witnessed his struggles with his emotional and physical afflictions. The
viciousness and suddenness of the attack, the clear malice of the attack and the
humiliation the plaintiff felt and still feels, call for an award of aggravated damages. I am
increasing the award of damages from $45,000 to $52,000 to take into account the nature
and the brutality of the attack.
In addition or in the alternative, the court could have awarded punitive damages (which are
intended to punish the defendant for malicious, oppressive, and high-handed conduct) but the
court did not award such damages nor explain why not. Presumably, the court concluded that the
damages point was adequately addressed by awarded aggravated damages only. This matter is
not discussed in the text but according to the Supreme Court of Canada in Hill v Church of
Scientology [1995] 2 SCR 1130 at para 196:
Punitive damages may be awarded in situations where the defendant's misconduct is so

malicious, oppressive and high-handed that it offends the court's sense of decency.
Punitive damages bear no relation to what the plaintiff should receive by way of
compensation. Their aim is not to compensate the plaintiff, but rather to punish the
defendant. It is the means by which the jury or judge expresses its outrage at the
egregious conduct of the defendant. They are in the nature of a fine which is meant to act
as a deterrent to the defendant and to others from acting in this manner. It is important to

emphasize that punitive damages should only be awarded in those circumstances where
the combined award of general and aggravated damages would be insufficient to achieve
the goal of punishment and deterrence.
2. Reginald Smith, an employee of UR Safe Ltd., a security company, broke into a
branch of a bank that was a customer of UR Safe Ltd. Smith did so when he was not
on shift with UR Safe Ltd., and by using keys he had stolen from his employer.
Using these keys, Smith gained access to the ATM room in the bank, but could not
figure out how to open the ATM combination lock. He was close to giving up when
he noticed that the bank kept an ATM instruction manual on a shelf right beside the
ATM in the ATM room. Smith read the manual and on that basis was able to open
the safe. Is UR Safe Ltd. vicariously liable for Smith’s tortious conduct? [footnote
deleted]
This Situation for Discussion is based on Royal Bank of Canada v Intercon Security Ltd
(2005), 143 A.C.W.S. (3d) 608 (Ont SCJ). In that case, the court concluded that there
was not a “significant connection” between the creation or enhancement of the risk of
theft and the thefts that the employee committed. On this basis, there was no vicarious
liability on the employer. The employee-thief was not responding to an alarm at the Bank
—he was in fact entirely off duty. And the employee-thief accessed the Bank with a key
he had stolen from his employer—not one that was in his lawful possession. Beyond this,
the Bank itself provided the thief with the means of accessing the safe by leaving the
combination accessible and leaving the ATM instruction manual out in the open.

3. Albert was walking home from his nightshift at 3:30 a.m. The road was very dark,
and Albert was wearing a red jacket, blue pants, black shoes, and a green cap.
Albert walked along the edge of the road but on the wrong side, such that his back
was to oncoming traffic. Albert heard a vehicle approaching behind him but decided
not to look or even move. Unfortunately, Albert was hit by the vehicle, a delivery
van; the driver was taking newspapers to a local drop-off point so that carriers
could then deliver them to homes on their routes. Albert was seriously injured.
Albert has two witnesses. The first is a police officer who arrived on the scene
and administered a breathalyzer test to the van driver. The van driver was not
impaired. Albert’s second witness is an individual who lives in a house directly
across the road from the accident scene. This witness heard the impact of the
accident and ran outside to help. This witness’s evidence only related to the position
of the plaintiff’s body and the location of the defendant’s delivery van. Will Albert
be able to establish negligence as against the driver of the van? Why or why not?
[footnote deleted]
This problem is based, in part on Anderson v Short (1986), 62 Nfld & PEIR (NFLD SCTD)
wherein the defendant’s application for a non-suit was successful.
Simply because the plaintiff has been struck by a car does not of itself prove negligence. The
plaintiff will have to demonstrate facts that prove negligence by the defendant driver. Neither the
police officer nor the individual who heard the impact and ran out to help actually saw the
accident so they cannot assist the plaintiff in this regard. Since the plaintiff’s back was turned
when he was struck by the car, he has nothing to add on this point.

Depending on what forensics can demonstrate based on the location of the plaintiff’s body
after impact, there is a chance of success but there are not enough facts given in the hypothetical
to really say for sure.
Beyond this, even if the plaintiff can show negligence, he almost certainly has contributed to
his own loss by walking with his back to traffic, in the dark, wearing dark clothes. The deduction
from his judgment for contributory negligence could be very high indeed.
4. The plaintiff hired the defendant to renovate the wooden wharf that the plaintiff
owned in British Columbia. The wharf was part of the plaintiff’s grain-loading
facility in Vancouver Harbour. During this renovation process, the wharf was
seriously damaged by fire. The fire was started by molten slag from an oxyacetylene
torch operated by the defendant’s employee. The defendant’s employee did not
minimize the fire hazard created by the torch. Among other deficiencies, the
defendant’s employee failed to wet the combustible surfaces before using the torch
and failed to keep a proper fire watch during cutting operations so that any slag
that landed could then be doused with water. When it came time to fight the fire, the
defendant’s employee ran into difficulties because the plaintiff had not provided a
fire protection system anywhere near the wharf in question, not even a fire
extinguisher. The plaintiff claims damages in the amount of $1 million. Assuming
that the defendant’s employee has been negligent in how he used the torch, what
would a possible defence of the defendant be? Should the plaintiff recover all its
damages or only a portion thereof? Is the defendant responsible for the tort of its
employee? Why or why not? [footnote deleted]

This situation is based, in part, on Alberta Wheat Pool v Northwest Pile Drive Ltd (1998), 80
ACWS (3d) 692 (BCSC), reversed in part (2000), 80 BCLR (3d) 153 (CA). The defendant has an
excellent chance of establishing the defence of contributory negligence because the plaintiff
failed to maintain a proper fire protection system. As a result, the plaintiff will be able to recover
only that portion of the damages not caused by its own fault. The defendant is responsible for the
tort of its employees based on the principle of vicarious liability discussed in the textbook on
page 230. The tort amounts to an unauthorized mode of doing something authorized by the
employer—namely, welding. In short, the plaintiff will recover only a portion of its losses
because the court will make a deduction from the judgment in proportion to the plaintiff’s
contributory negligence.
5. Louise arrived for a two-week vacation at a Mexican resort. She spent the day at
the beach and, on returning to her room, found a bottle in the fridge containing a
clear liquid. Louise assumed the liquid was water and started to drink from the
bottle. It turns out that a member of the cleaning staff had inadvertently left a bottle
of caustic cleaning solution in the fridge in Louise’s room and this is what Louise
had drunk. Louise suffered extensive injury and required emergency surgery to
remove some of her esophagus. Louise wants to sue the cleaning staff member who
had left cleaning solution in Louise’s fridge. Will this action be successful? Does the
cleaning staff member have any defences? [footnote deleted]
This Situation for Discussion is based on a news story: Elise Stolte, “Woman sues Mexican
resort over caustic cleaning fluid left in fridge,” Edmonton Journal (20 February 2011) at

<http://www.canada.com/edmontonjournal/news/cityplus/story.html?id=997a10a5-39d2-49ba-
8459-96aa3f1ca131>.
Based on Chapter 10’s working definition of negligence, it would be a virtual certainty that
the employee has been negligent. The employee has caused loss or injury to Louise through her
unreasonable or careless conduct in relation to a hotel guest. It is unreasonable for the cleaning
staff member to leave a dangerous clear fluid in the fridge, especially as it could easily be
mistaken for water by a guest. Though the employee could argue that Louise was contributorily
negligent for not ensuring that the fluid she found in her resort room fridge was, in fact, water,
this is likely to fail. Hotel guests are entitled to assume that what they find in their mini-fridges
are fit for human consumption.
Instructors might consider revisiting with students this Situation for Discussion at the end of
Chapter 11, after the tort of negligence has been more thoroughly canvassed. Students can be
asked to offer an analysis of each element in proving a negligence action.
6. Archie became drunk at the office Christmas party. When he was leaving the event,
his employer grew concerned and offered to drive him home, particularly as the
winter weather was getting bad. Archie declined, notwithstanding a snowstorm and
his own impairment. Archie was in a serious car accident, resulting in his suffering
brain injuries and multiple fractures. Is the employer responsible to Archie for
negligence? Will a court find Archie contributorily negligent? [footnote deleted]
Even though Archie’s employer took some steps to protect him by offering to drive him home,
this is insufficient. As the court stated in Hunt v Sutton Group Incentive at para 58:

the defendant Sutton [the employer] not only owed its employee an obligation to take
reasonable care to avoid acts or omissions which it could reasonably have foreseen would
likely cause her some harm, it also owed its employee an overriding managerial
responsibility to safeguard her from an unreasonable risk of personal injury while on
duty.
See too at para 58:
It was open to the defendant to send the plaintiff home by taxi, if necessary to take her car
keys away and to take custody of her car. Alternatively, it should have taken steps to call
her common-law husband to come and pick her up. Alternatively, he could have taken her
to a local hotel or found somebody else who had not been drinking to do so or to drive her
home.
Archie will likely be found to have been contributory negligent however. As the court in
Sutton stated at para 66:
Having found that the defendants [including the employer] have failed to discharge their
duty to safeguard the plaintiff from harm, there is an onus on the defendants to satisfy this
court that the plaintiff has been contributorily negligent towards the cause of her accident.
I find that her consumption of alcohol was self-induced. Just as I have found that her
degree of impairment due to the consumption of alcohol was a cause of the accident, so
too is her self-indulgence in the partaking of such alcoholic beverages an attributable
cause of the accident. I find that turning her back to the dangers that she ought to have
foreseen by allowing herself to drink and then drive home in such weather conditions as
existed at the time in question was negligent on her part. She ought to have foreseen that
by becoming intoxicated, her judgment would then become impaired. Her impaired
judgment led her to decline her employer's offer to call her common-law husband to take
her home. Her impaired judgment also caused her to misjudge the danger in driving home
in such weather conditions.
Note that on appeal, one of the grounds raised was that the judge had been in error to grant the
plaintiff’s counsel’s motion to discharge the jury. The Court of Appeal agreed and ordered a new
trial on this basis alone.

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Enriched Instructor’s Manual—Answers to accompany Canadian Business and the Law, 6th edition Chapter 10

Canadian Business and the Law Canadian 6th Edition Duplessis

Full download at:

Introduction to Tort Law

After studying this chapter, students should have an understanding of

 the broad scope of tort law

 the difference between a civil action and a criminal action

 the purpose of tort remedies

 how business can manage its potential liability in tort

© 2016 Nelson Education Limited 10-1

emphasizes the importance of managing tort risk.

II. TEACHING STRATEGIES

recover in the first instance.

businesses to commit intentional torts.

© 2016 Nelson Education Limited 10-2

III. STUDENT ACTIVITIES

© 2016 Nelson Education Limited 10-3

online: NPR <http://www.npr.org/templates/story/story.php?storyId=48308288>.

legal liability and what the alternatives are, if any.

IV. EXPLANATION OF SELECTED FEATURES

Case: Fullowka v Pinkerton’s of Canada Ltd, [2010] 1 S.C.R. 132

trespassers from accessing the mine, not to guarantee a result.

© 2016 Nelson Education Limited 10-4

context to this case.

risks of a workplace accident be managed?

risk of worker injury due to improper use of a ladder.

take to avoid ladder-related injury include as follows:

on the ladder at all times.

© 2016 Nelson Education Limited 10-5

materials to get around this problem.

climbing a ladder while wearing wet, muddy shoes.

 Inspect overhead for all electrical lines before setting up a ladder.

 Set the ladder angle correctly.”

online: < http://www.parsonslawgroup.com/how-to-prevent-workplace-ladder-injuries.html>.

Safety” (undated document), online: Texas Department of Insurance,

<https://www.tdi.state.tx.us/pubs/videoresource/t5laddersafe.pdf>, including this one:

safety. See <https://canadasafetycouncil.org/training/ladder-safety-training-course>.

Business and Legislation: Workers’ Compensation

© 2016 Nelson Education Limited 10-6

and by extension, disease, should be financially assisted, rehabilitated and, if

necessary, retrained, without regard to the cause of their disability. No-fault

programs [such as the WCB] do not distinguish among victims of accidental,

negligent or deliberate conduct which results in the disability either in terms of

eligibility or quantum of benefits.

of damages should Schultz seek and why? [footnote deleted]

© 2016 Nelson Education Limited 10-7

trial, Dennis may also be entitled to punitive damages.

court” (9 January 2009) at <http://www.cbc.ca/news/arts/music/story/2009/01/08/bon-jovi.html>.

ratios or word descriptors?

the U.S. Supreme Court,

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To read the full decision, go to <http://www.supremecourt.gov/opinions/07pdf/07-219.pdf>. See

page 231 of the textbook.

© 2016 Nelson Education Limited 10-9

award against a large corporation would contain no sting.

insurance companies need to understand that their conduct—including making groundless

© 2016 Nelson Education Limited 10-10

ensure that such conduct does not occur.

overlap? In what way are they distinct?

the wrong in question, by whom, and to what standard.

© 2016 Nelson Education Limited 10-11

267. Every one who, in committing an assault,

(a) carries, uses or threatens to use a weapon or an imitation thereof, or