Date: Thu, 9 Nov 2006 15:25:15

From: David Cheifetz

Subject: Claimants' contributory fault, policy, and public authority "impecuniosity"

All:

I'm defending a property damage claim in which earlier conduct of the claimant is, arguably, one of the causes of the later incident that resulted in the damage.

Some years before the incident, the claimant was told by an outside consultant to do some work which the consultant considered necessary. If done, that work would have prevented the later incident from occurring. It didn't do the work.

One of the reasons for the recommendations was the structural safety of the item given existing damage. The other was to avoid additional damage (in the future) from recurring incidents of the type that had occurred before, had produced the safety conditions that resulted in the consultant's recommendations, and would probably continue to happen in the future on a regular basis. In fact, one did - that which produced the action I'm defending.

One of the claimant's explanations (excuses) for not doing the work is that the consultant's advice was wrong. That's a factual issue.

The other excuse is cuter and perhaps something plausible only in a Canadian common-law jurisprudential context since we've maintained the Anns policy/operation dichotomy. The claimant says that even if the consultant was right, it didn't have enough money to do that work and other unrelated work it thought more necessary in other areas.

I wouldn't be concerned about that argument if advanced by a private citizen, since it amounts to asserting impecuniosity (not caused by the wrongdoer) as an excuse for not taking reasonable care.

On the other hand, the claimant, in my case, is a public authority. What it's doing is trying to use the "policy decision" argument Canadian public authorities sometimes successfully use as a defence in liability cases as a valid excuse (against contributory fault) for not following the consultant's advice, if one assumes that it was the correct advice that should have been followed and would have been followed if the claimant had unlimited funds.

The claimant is, of course, claiming that it made the policy decision after a proper consideration of factors.

It's a strange sort of impecuniosity. The authority didn't have the money because it didn't ask for it. Of course it didn't have the budget to do everything that might be done but that's irrelevant. I think it's a correct assumption that it could have got more in the budget by asking for more money and it would have got more if it had asked for it if the request was justified. And, it would have asked for more if it had thought the work immediately necessary which would have made the request justified. Catch-22. I've not thought through the consequences of the conclusion (unrealistic, I think) that the money never would have been there.

There were public safety issues, but that shouldn't make a difference to the analysis except make the request more justifiable if the consultant was right.

I'm inclined to view the case as one in which the authority took a calculated risk that nothing untoward would happen, and lost. I don't think that makes it volenti (given modern apportionment approaches) unless I find a memo (or equivalent) in the public authority's "files" which is the equivalent of Ford's "it's cheaper to pay damages than recall and repair" Pinto memo. However, I don't expect to be that lucky.

I'm not aware of any cases or articles. Is anyone else? I have asked the government's lawyers if they know of any basis.

All comments welcome, off-list if preferred.

Thanks.

David Cheifetz

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