Download Supreme Court of Canada Grand Trunk Pacific Coast Steamship Co

Supreme Court of Canada
Grand Trunk Pacific Coast Steamship Co. v. Victoria-Vancouver Stevedoring Co., 57
S.C.R. 124
Date: 1918-06-25
Grand Trunk Pacific Coast Steamship Company (Defendant) Appellant;
and
Victoria-Vancouver Steve-Doring Company (Plaintiff) Respondent.
1918: June 6; 1918: June 25.
Present: Sir Charles Fitzpatrick C.J., and Idington, Anglin and Brodeur JJ. and Cassels J. ad hoc.
ON APPEAL FROM THE COURT OF APPEAL FOR BRITISH COLUMBIA.
Contract—Indemnity clause—Master and servant—Negligence.
In an agreement under which the respondent contracted to supply the requisite
longshore labour in connection with the ships of the appellant, who was to supply all
necessary gear, an indemnity clause provided: "That the Steamship Company shall hold the
Stevedoring Company entirely harmless from any and all liability for personal injury to any of
the Stevedoring Company's employees while performing labour embraced in this agreement."
The appellant having failed to supply some wheelbarrows required for unloading coal, the
respondent gave instructions to one Scott to get them at their own warehouse. Scott, having
met with an accident in doing so, recovered damages from respondent, who then took action
against appellant for indemnification under the above clause.
Held, that Scott, at the time he was injured, was performing labour embraced in the
agreement.
APPEAL from the judgment of the Court of Appeal for British Columbia1, maintaining,
upon an equal division of the court, the judgment of Murphy J. at the trial 2, by which the
plaintiff's action was maintained with costs.
The circumstances of the case and the questions in issue are fully stated in the above head—
note and in the judgments now reported.
[Page 125]
Geo. F. Henderson, K.C. for the appellant.
Wallace Nesbitt K.C. and C. C. Robinson for the respondent.
THE CHIEF JUSTICE.—The case really depends upon the interpretation of clause 5 of the
agreement between the parties which reads:—
1
2
38 D.L.R. 468; [1918] 1 W.W.R. 196.
[1917] 1 W.W.R. 791.
5. That the S.S. Co. shall hold the Stevedoring Company entirely harmless from any and
all liability for personal injury to any of the Stevedoring Company's employees while
performing labour embraced in this agreement.
It has been held and I think rightly that an employee of the respondents was injured while
performing labour embraced in the agreement. If the workman's employment compels him to
be at a particular place when the accident happens, the accident must be taken to arise out of
the employment, although it is not being contributed to in any way by the nature of the
employment. It is not, I think, disputed that the accident was due to the respondents'
negligence.
The trial judge held that clause 5 above quoted was intended and the language used was
sufficiently wide to cover the respondents' own negligence.
In the appeal court, where there was an equal division of opinion, Chief Justice Macdonald
thought that the contract should be construed only to relieve the respondent of the burden of
making compensation to employees under the "Workmen's Compensation Act," which
compensation is payable irrespective of the employee's negligence. He relied in support of
this view on the case of Price & Co. v. Union Lighterage Co.3, but with all respect I think he
has failed to appreciate the principle on which that decision is based. Mr. Justice Walton, the
trial judge whose judgment was approved by the Court of Appeal, says:—
[Page 126]
There is a well-established rule of construction applicable to the present case. The law
of England, unlike in this respect the law of the U.S. of America, does not forbid the
carrier to exempt himself by contract from liability for the negligence of himself and his
servants; but, if the carrier desires so to exempt himself, it requires that he shall do so in
express, plain, and unambiguous terms.
And this is no arbitrary distinction of the case of carriers but depends on the fact that a carrier
is liable not only for the due conveyance of goods as he is of passengers but is also liable as
an insurer of the goods. It is fallacious to say that the greater liability of carriers than of other
classes of contractors is "merely a question of degree." Under his contract the carrier has a
duty of conveyance for the neglect of which he is liable, but as an insurer he is liable
irrespective of any negligence on his part and this is a liability of a different kind. The rule of
construction established in the case of the contracts of carriers is that the exemption clause
refers to conveyance in contradistinction to insurance—that it limits the liability not the duty.
3
(1904) 1 K.B. 412.
But in truth these cases have nothing to do with the present one, for in all contracts, even
including those of carriers, it is a question of what was the intention of the parties. Now, I think
nothing can be clearer than the intention of the parties to express in clause 5 of the
agreement under consideration that the respondents should be relieved of all liability,
however occurring, to any of their employees. Mr. Justice McPhillips says that to construe the
provision in accordance with the submission of the appellant would be to render it wholly
illusory; it certainly would restrict its operation within very narrow bounds, for it cannot
consistently be held to apply even to all cases under the "Workmen's Compensation Act,"
since damages may of course be recovered under this Act where the employer has been
guilty of negligence as well as when he has not.
[Page 127]
The wording of this clause of the contract is as wide as possible and there is no reason for
attributing to the parties any intention of restricting its natural meaning. I do not think,
therefore, the rule of construction adopted for a totally different class of contracts and for
reasons which have no application here can be invoked to restrict such natural meaning.
In my opinion the appeal should be dismissed with costs.
IDINGTON J.—The appellant having contracted with respondent for services to be performed
by its men, amongst other things, agreed as follows:—
That the Steamship Company shall hold the Stevedoring Company entirely harmless
from any and all liability for personal injury to any of the Stevedoring Company's
employees while performing labour embraced in this agreement.
The appellant having failed in its supply of what it had contracted for, one of the men was sent
to get it from the respondent's warehouse. He met with an accident in doing so for which he
had recourse against the respondent and rightfully recovered damages. The appellant claims
this liability for a personal injury did not fall within the meaning of what the contracting parties
had in contemplation in the clause I have quoted.
I cannot so fritter away the very obvious purpose of such a contract of indemnity. It does not
appear to me that the appellant can be heard to say that its own default in making the service
more onerous than it might have turned out can thus escape responsibility.
The very obvious purpose of such a contract as in question was to free the respondent from
that incidental loss that every employer of labour may incur, and in all probability must incur,
by reason of negligence,
[Page 128]
from time to time in the course of executing what he has undertaken.
The cases relied upon do not seem to me to touch the question.
If the accident had arisen from something wilful on the part of respondent then one could
hardly say that it had fallen within the scope of what in reason was within the contemplation of
those making such a contract.
Nor can I see how the contract, under which the parties had been operating beyond the
period originally named can be said, as argued for appellant, to have terminated when they by
mutual consent, to be implied from their conduct, had extended its operation. All the terms of
any such like time contracts are in law, when so extended, presumed, so far as applicable, to
govern those so acting thereunder.
I suspect if the appellant had been sued for an increased rate of wages it would have been
able to see the point and understand the law in the sense I refer to.
The appeal should be dismissed with costs.
ANGLIN J.—It is common ground that one Scott, an employee of the plaintiffs, recovered
judgment against them in respect of a personal injury sustained on the 31st of July, 1915,
which was caused by negligence imputable to them either at common law or under the
"Employers' Liability Act." Rightly or wrongly the defendants have admitted that the finding of
such liability is binding upon them. The plaintiffs, on the other hand, do not suggest that their
liability to Scott could have been based on anything other than fault or negligence.
The chief defences to their claim to indemnity made in this action are that Scott at the time he
was
[Page 129]
injured was not "performing labour embraced in (the) agreement" for stevedoring made
between the plaintiffs and the defendants, and that injuries ascribable to the plaintiffs'
negligence are not within the provisions for their indemnification, which reads as follows:—
That the Steamship Company shall hold the Stevedoring Company entirely harmless
from any and all liability for personal injury to any of the Stevedoring Company's
employees while performing labour embraced in this agreement.
It was also alleged that the stevedoring agreement had been terminated before Scott was
injured.
It recites that
The Stevedoring Company is desirous of undertaking the stevedoring business of the
Steamship Company at Vancouver, B.C., and Victoria, B.C., and the Steamship
Company is willing to accord this privilege upon terms and conditions and at prices
hereinbefore set forth,
and it provides that it shall
remain in force for a period of one year from the date hereof (20th Nov., 1911) and if not
then terminated, to remain in force thereafter until either party should give three months'
notice in writing terminating the same.
Primâ facie this agreement would continue in force unless some step were taken to bring it to
an end at the close of the first year. Action by one of the parties was required to terminate it
on the 20th Nov., 1912. No evidence of any such action or of any subsequent notice to bring it
to an end on the expiry of three months was given. The burden of proving termination was, in
my opinion, on the party alleging it. The agreement must therefore be deemed to have been
in force when Scott was injured.
For the reasons assigned by the learned trial judge I am also satisfied that the work Scott was
engaged on when injured was "labour embraced in (the) agreement." He was carrying out a
lawful direction to bring from their place of housing or storage some
[Page 130]
wheelbarrows belonging to the plaintiffs which were required for unloading coal—part of the
stevedoring work undertaken by the plaintiffs. The arrangement that the defendants were to
supply all necessary gear did not necessarily make it part of their obligation to bring such gear
to the ship's side. They appear to have arranged to "borrow" these wheelbarrows from the
plaintiffs. Obtaining them from the place where they were ordinarily kept in order to use them
in unloading would seem to have been part of the stevedoring work for which the defendants
undertook to supply labour and therefore to have been "labour embraced in (the) agreement."
Unless the plaintiffs were "undertakers" within the meaning of that term as defined by section
2 of the "Workmen's Compensation Act," R.S.B.C., 1911, ch. 244, they would not be liable
under that Act for personal injuries sustained by their employees. Section 4 restricts its
application to employment by "undertakers" as defined in the Act.
"Undertaker" (as defined) in the ease of a railway means the railway company; in the
case of a factory, quarry, laundry, smelter or workhouse, means the occupier or operator
thereof, in the case of a mine, means the owner thereof; and in the case of an
engineering work or other work specified within this Act means the person undertaking
the construction, alteration, repair or demolition.
I agree with Mr. Nesbitt's contention that a person or company engaged in the work of
stevedoring is not an undertaker within this definition.
Apart from that established by the "Workmen's Compensation Act" in cases that fall within it, I
know of no foundation for liability of an employer to his employee for personal injuries
sustained by the latter in the course of his employment except fault or negligence imputable
to the employer either under the common law or the "Employers' Liability Act." Under
[Page 131]
these circumstances, since it was against liability of the plaintiffs to their employees for
personal injuries that the defendants engaged to indemnify them, I think such liability arising
from negligence must not only have been within the contemplation of the parties but must
have been the very thing in respect of which they were contracting. The case of the City of
Toronto v. Lambert4, relied upon by counsel for the appellants, is clearly distinguishable on
this ground. Had this view of the matter presented itself to the learned Chief Justice of the
Court of Appeal of British Columbia I incline to think he would have reached the same
conclusion. His citation of McCawley v. Furness Ry. Co.5, appears to warrant this inference.
I express no opinion on the question whether injuries caused by negligence of, or ascribable
to, the Stevedoring Company would or would not have been within the purview of the term
"any and all liability for personal injury," were it not reasonably certain that such liability must
4
5
54 Can. S.C.R. 200; 33 D.L.R. 476.
L.R. 8 Q.B. 57.
have been, and that liability apart from and without negligence or fault cannot have been,
within the contemplation of the parties to the agreement under consideration
The appeal fails and should be dismissed with costs.
BRODEUR J.—The liability of the appellant depends upon the construction of an agreement
between the parties by which the appellant company undertook to hold the respondent
company
entirely harmless from any and all liability for personal injury to any of the Stevedoring
Company's employees while performing labour embraced in this agreement.
In my opinion, there is no doubt that the man Scott was injured when he was doing some
stevedoring
[Page 132]
work contemplated by the contract. Wheelbarrows were required for the unloading of the ship
and when he was bringing them he had an accident for which he sued and obtained judgment
against his employer, the respondent company. The latter now seeks to be indemnified by the
appellant under the above clause of the contract.
It is common ground that the accident was due to the stevedoring company's negligence.
Nobody would suggest, however, that the negligence was wilful. But it is one of those
accidents inherent to the carrying out of work of that kind. The indemnity clause is a very wide
one. It is not restricted to liability arising out of the "Workmen's Compensation Act" or
"Employers' Liability Act"; but it is general "from any and all liability for personal injury."
One of the greatest risks the contractor for labour must incur is his liability for damages for
personal injury to his workmen. The number of persons employed and the lack of care on the
part of some of those employees render the undertaking a risky one.
In this case we have besides a provision in the contract that all the gear and apparatus for
performing the work should be supplied by the Steamship Company.
The defective appliances are to a very large extent the cause of those accidents to workmen.
It was only natural for the parties to agree that all those accidents, whether they were caused
by the ordinary neglect of the steamship company or of the stevedoring company, should be
provided for. It is not giving then to the contract too wide an interpretation to declare that the
liability of the appellant company covers a case similar to the one we have before us.
[Page 133]
The judgment that has declared the appellant company liable should be confirmed with costs.
CASSELS J. ad hoc.—I am of the opinion that this appeal should be dismissed with costs.
Appeal dismissed with costs.
Solicitors for the appellant: Tupper & Bull.
Solicitors for the respondent: Davis & Co.