Date: Tue, 13 Feb 2007 20:55:40 -0800 (PST)

From: David Cheifetz

Subject: Resurfice Corp. v. Hanke, 2007 SCC 7

Neil,

I might be one of the spillers of academic ink mentioned in para. 20: if so, I've added mere drops.

You seem to have been led astray as to what the trial judge did or didn't do by the SCC's descriptions. Unfortunately, there's a real chance that those reasons are going to lead many lawyers and judges astray.

I do not read the trial judge's conclusions the way you stated them in the first sentence of item 2. He found that there was nothing wrong with the design. He did not find that since Hanke was not confused, existing design flaws had nothing to do with the accident.

I've read all 3 levels in Hanke (but not the trial transcripts). I don't think the trial judge was confused at all based on my reading of his reasons. One might want to take issue with whether he adequate reviewed the evidence as to whether the design was adequate - the standard of care issue - but that, as you indicate, has nothing to do with causation. It seems that the SCC was satisfied, from the review of all of the material it was given - which I assume contained relevant excerpts from the transcripts - showed the trial judge had reviewed the evidence, adequately. That's what they said he did. They said that there was evidence to support his conclusions of fact and mixed fact and law - this included the decision that the design was proper. That, then, was the end that issue. The Alta CA should never have interfered with that conclusion.

This is a bit of a crude way to put it but, to me, what the Alta CA seems to have said is that the trial judge got the law wrong; and, oh yes, since he got the law wrong we're also not satisfied that he got the facts right. The point being - and it is correct - that one can't know what the relevant facts are if one doesn't know what the law is. Chicken and egg.

Leave it that the Alberta Court of Appeal's version of what the law should be was unusual. Vaughan Black and I pointed out why in a case comment. But, on account of the ... vagaries ... of Canadian material contribution law, the Alta CA judges are not the only Canadian appellate court judges (and trial court judges) to have recently suggested that the mere fact that there's more than one potential cause is sufficient to make but-for unworkable and trigger the application of material contribution: see, for example Aristorenas v. Comcare Health Services, 2006 CanLII 33850 at para 53.

[53] Thus, it would seem that the 'material contribution' test is applied to cases that involve multiple inputs that all have harmed the plaintiff. The test is invoked because of logical or structural difficulties in establishing 'but for' causation, not because of practical difficulties in establishing that the negligent act was a part of the causal chain.

Well, no. Not even in Canada.

It's my view that we can't come to any reliable conclusions about the current content or limits of the Canadian material contribution test from what the SCC said in Hanke. I wrote, about 20 months ago, that the "content of the [Canadian] material contribution doctrine has all of the substance of gossamer or the lace tatted by Carroll's Beaver; and a thimble is all we need to contain it." Things haven't improved in the months since. Depending on how one looks at the Hanke paragraphs on mc, the SCC has just made that thimble even smaller (if that were possible), or infinitely big. But, heck: we're lawyers. We have 'negative capability'.

Things are bad enough that the judges of the appellate court of the province in which I practise don't seem to be able to agree amongst themselves on what the principles are and content of material contribution is. If you're inclined to waste a few moments, compare what the Ont CA said in Aristorenas to the prior Ont CA case in Cottrelle, from which Aristorenas quoted.

I'm not holding my breath that anything will improve in the immediate future, so that means there will be more spilled judicial and academic ink, at least in this country. I might even contribute to that state of affairs.

And, yes, Mr. Hanke could not sue his employer or co-employees because of worker's compensation legislation. However, he could sue the manufacturer and distributor. If the incident was also the fault of the employer or a co-employee, their degrees of fault would have been determined. The distributor and manufacturer wouldn't be liable for the employer/employee "share".

Regards,

David Cheifetz

----- Original Message ----
From: Neil Foster
To: Richard Wright
Sent: Tuesday, February 13, 2007 6:53:27 PM
Subject: RE: ODG: Resurfice Corp. v. Hanke, 2007 SCC 7

Dear Colleagues;

Having been away last week I have now had a chance to read Resurfice v Hanks and felt I had to support Richard's comment here. There is some very deep confusion in the judgement of the SCC on the causation issue.

To briefly recap for those who haven't read it: Mr Hanks was injured in an explosion of an "ice-resurfacing" machine when he mistakenly put water in the gasoline tank. His action against Resurfice, the manufacturers of the machine, was based on an allegation of defective design - the water and gasoline tanks were right next to each other and easily confused. The trial judge found against him on the basis that it was not foreseeable that someone would do this, and on the causation issue because Mr Hanks conceded he knew the difference between the two tanks and hence, whether or not someone else was confused, Mr Hanks was not and hence the faulty design did not cause the injury.

(1) On the foreseeability issue (assuming it is being discussed as relevant to "breach", it being presumably obvious that a manufacturer of a machine owes a duty of care to ultimate users), the Alberta CA overturned the trial judge because at one stage he suggested he was not even going to discuss the issue of design error, as the accident (he said) was caused by Mr Hank's foolishness. This was clearly not the right approach to the issue of foreseeability, which was whether or not someone might be confused about the tanks. But the SCC said that in the end the trial judge did adequately discuss the "design error" arguments, so he did actually deal with the correct issues (SCC [8]). So they effectively held that as a matter of fact the trial judge was entitled to find that the particular design was not confusing.

It is worth noting that the SCC were entirely correct at [11] to dismiss the suggestion from the CA that "reasonable foreseeability" at the breach stage should include matters such as "seriousness of the injury" and "relative financial positions of the parties". On the conventional analysis in Australia at least "seriousness of injury" is not a matter that goes to foreseeability, but rather one of the four issues that is weighed up in the "calculus" of Wyong Shire Council v Shirt in determining overall whether or not there has been a breach of duty. And "relative financial positions" might be a matter to weigh in the initial determination of the existence of a duty, but shouldn't really come into the breach analysis.

(2) On the causation issue the trial judge had effectively found that since Mr Hanks was not confused about the difference between the tanks, the alleged design flaws had not contributed to the accident. {I would have thought it pretty clear that this conclusion did not necessarily follow. Even if Mr Hanks knew the difference between the two tanks when he stopped to think about it (which is what his admission noted in SCC [14] seems to mean), this does not mean that the tanks were properly designed. If they were so placed that a busy employee who is not fully attentive might easily confuse them on the spur of the moment, then to my mind it might still be said that the design of the tanks contributed to the accident. There are innumerable comments from superior courts that making work equipment safe involves taking into account carelessness of workers!} The SCC acknowledged that the trial judge's approach was defective in SCC [17].

Carelessness of a worker does not automatically absolve a manufacturer. The example conceded by McLachlin CJ there is this: "If it is industry standard to design an iron with an automatic shut off switch, and an iron is manufactured without such a switch, the manufacturer of the iron is not absolved of liability merely because the plaintiff was careless in leaving the iron on, resulting in a fire and injuries to the plaintiff." I would agree, but add that "industry standard" is not the only test of negligence here, as some industries have very low standards!

But in the end the SCC held that the trial judge was justified in saying that the accident "had nothing to do with the design or manufacture of the machine". The rest of the judgement, then, considers what "having nothing to with" means.

From para [18] on we enter the realm of real confusion. The Alberta CA had overturned the trial judge, apparently, because (i) he had found that "but for" the carelessness of the worker the accident would not have happened; (ii) but the "but for" test is unworkable in some circumstances and the trial judge should have used a "material contribution" test.

The fundamental problem here, it seems to me, is that apples are being criticised for being bad oranges. Even if proposition (i) is true, surely it might also be true that "but for" the bad design of the machine the accident might not have happened. All the "but for" test does is identify possibly relevant factors; a single factor found by the "but for" test does not exclude other factors! And when we come to proposition (ii) confusion is compounded by taking "material contribution" as an alternative to the "but for" test. I don't think this can be right. At least in the way that the phrase "material contribution" is used in Australia, it is simply a way of specifying a sort of threshold part in the causal "net" leading to the incident so that what is being referred to makes a "more than trivial" contribution to the occurrence. That is, something has made a "material-contribution-to-the-harm". In NSW in Bendix Mintex Pty Ltd v Barnes (1997) 42 NSWLR 307 Mason P distinguished this concept from that "material increase in risk" and said : "The law does not equate the situation where the defendant had materially increased the risk of injury with one where he had materially contributed to the injury." (at 42 NSWLR 316G)

But when we see the discussion of the SCC it seems that they are referring to "material contribution" as if it means "material increase in risk". They want to define the "but for" test at para [23] as requiring a "substantial connection" between the injury and the conduct of the defendant. The word "substantial" here seems to "raise the bar" from the word "material". And the "material contribution" test is spoken of in para [24] as an "exception" to the "but for" test. The description of it in para [25] must mean that they are referring to the McGhee/Fairchild/Barker type of "increased risk" analysis (though none of these cases is cited).

Sadly, as others here have noted, they go in later paras to further muddy the waters by treating Cook v Lewis as if it were one of these "increased risk" cases when it is in fact subject to a different analysis altogether (given by Richard in his NESS analysis, I think).

Even the case in para [28], dealing with the question of what a specific person would probably have done in certain circumstances, is not an "increased risk" case but simply an example of ordinary probability considerations: see eg Finch v Rogers [2004] NSWSC 39 where causation was established on the basis of what the particular doctor on duty on a specific occasion would have done.

Finally, it struck me as I read the judgement that some of the confusion evident at all levels in these proceedings may possibly be a side-effect of what I understand to be the abolition of common law workplace injury claims against employers in Canada. Presumably Mr Hanks is suing the manufacturer of this machine because he cannot sue his employer. But now that the courts in Canada no longer deal with workplace injury claims on a regular basis, a number of quite well-established common law principles are being forgotten (the cases on the need for workplaces and equipment to take into account carelessness of workers, for example.) But this may just be my particular bias intruding, of course!

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