IN THE SUPREME COURT OF BRITISH COLUMBIA

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Between: And Gosselin v. Shepherd, 2010 BCSC 755 April Gosselin Date: 20100527 Docket: S104306 Registry: New Westminster Plaintiff Mark Shepherd and Dr. Mark J. Shepherd Chiropractic Services Inc. Defendants Before: The Honourable Mr. Justice Sewell Reasons for Judgment Counsel for the Plaintiff: Counsel for the Defendants: Counsel for the Attorney General of British Columbia (Intervenor): J.S. Voss D.W. Yule, Q.C. M. Van Nostrand B. Mackey and B. Carmichael Place and Date of Hearing: Place and Date of Judgment: Vancouver, B.C. May 6, 2010 Vancouver, B.C. May 27, 2010

Gosselin v. Shepherd Page 2 [1] On May 6, 2010 I heard two applicants raising the same issue. In these reasons I will deal with the application in New Westminster Registry No. S104306 in which the plaintiff, April Gosselin, applies for an order to amend her statement of claim to add a claim pursuant to s. 2 of the Health Care Costs Recovery Act, R.S.B.C., 2008 Ch. 27 (the Act ) to recover the cost of health care services provided to her by the government of British Columbia. In Vancouver Registry No. S070700 the plaintiff, Irene Fong, made application for substantially the same amendment. I will deal with that application in separate reasons. [2] Ms. Gosselin alleges she was injured on June 7, 2005 as a result of the negligence of the defendants. She commenced this action on March 1, 2007. [3] Ms. Gosselin seeks the following amendment: The plaintiff is a beneficiary as defined in section 1 of the Health Care Costs Recovery Act, R.S.B.C. 2008 Chapter 27, who has received one or more health care services as defined in section 2(1) of the Health Care Costs Recovery Act, and without restricting the generality of the foregoing, the plaintiff specifically pleads and relies upon the Health Care Costs Recovery Act and amendments thereto and any subsequent enactments that may apply. [4] The defendants oppose the amendment on the grounds that it discloses no reasonable cause of action against them. They submit that the Act does not permit Ms. Gosselin to advance a health care services claim in the circumstances of this case. [5] The parties agree that if the claim set out in the proposed amendment is not available pursuant to the Act the amendment does not disclose a cause of action. Ordinarily on an application to amend, the Court should address the merits of the proposed amendment only to decide whether it is plain and obvious whether the proposed amended claim will fail. However, counsel for the parties have agreed that I should consider and decide the underlying issue of the applicability of the Act.

Gosselin v. Shepherd Page 3 [6] Counsel for the Attorney General appeared as an intervenor to make submissions as to the proper construction of the Act, but took no position on whether I should decide the issue of the applicability of the Act raised by the defendants. [7] I have concluded that I should decide the underlying question because that is what the parties requested and because the issue is one of law alone. I note that in Attorney General of Canada v. Inuit Tapirisat of Canada, [1980] 2 S.C.R. 735 the Court stated that the circumstance that a point required lengthy legal argument to decide is not determinative of whether the Court should determine it pursuant to Rule 19(24). As the analysis of the merits for amendment is the same as under Rule 19(24), I consider it to be appropriate to decide the issue put before me by the parties. [8] The defendants submit that the Act does not retrospectively affect their vested rights to avoid liability established by the decision of Semenoff v. Kokan, (1991) 84 D.L.R. (4 th ) 76 (BCCA). The Act has overruled the decision in Semenoff but the issue before me is the extent to which that overruling applies retrospectively. [9] The Act came into effect on April 1, 2009. [10] In MacEachern v. Rennie 2009 BCSC 652 at paragraphs 6-12 of his judgment, Mr. Justice Ehrcke reviewed the legislative scheme contained in the Act. I need not repeat here what he said in that case. [11] Counsel for the Attorney General submitted that the plain wording of s. 24(1) of the Act makes the Act applicable to injuries suffered before the Act came into force. The Attorney General s submission is that there is nothing in s. 2 of the Act which limits the right of a plaintiff in an existing action to amend his or her claim to make a health care benefits claim in respect of injuries suffered prior to April 1, 2009. [12] Counsel for the defendants submits that the Act does not apply to claims for personal injury in respect of which the Province had no direct right of action on April 1, 2009, and does not apply to proceedings commenced prior to that date. On the

Gosselin v. Shepherd Page 4 effective date of the Act the Province had a direct right of action with respect to any health care services claim caused by injuries suffered as a result of a wrongful act which occurred up to two years and six months prior to April 1, 2009. This claim arose well before that time. The defendants further submit that the Act has only limited retrospective effect and that it would be inconsistent with the proper principles of interpretation of statute and contrary to the scheme set up in the Act to interpret it to give a right of action to the plaintiff for the cost of health care services when the government has no right to make such a claim. [13] There is a disagreement between the parties about the nature of a health care services claim. Counsel for the Attorney General and Ms. Gosselin submit that the Act does not create a new cause of action but merely expands the scope of permissible damages recoverable in an action based on negligence or other wrongful act or omission. [14] Counsel for the defendants submit that the Act creates a new statutory cause of action. I tend to agree with the defendant s counsel on this issue. The Act does create a statutory cause of action in favour of the government. I think that s. 2(1) of the Act also creates a statutory right to recover specific costs in addition to damages actually suffered by the beneficiary. In addition, the provisions of ss. 3(3) and 3(4) of the Act strongly suggest that the legislature regards a health care services claim as a new and distinct cause of action. However, on the view I take of the matters before me, I do not find it necessary to decide that issue. [15] The Act gives the government four different ways to recover the costs of health care services. Section 3(1) of the Act obligates a beneficiary who commences a legal proceeding against a wrongdoer for damages for personal injury or death to include a health care services claim in the legal proceeding. Section 3(3) provides that the Court must permit amendment of the originating documents up to six months after the date on which the originating documents were filed in the Court if a health care services claim has not been included in a legal proceeding. Section 6(1) of the Act permits the government to intervene in any proceeding referred to in

Gosselin v. Shepherd Page 5 s. 3 and assume conduct of the health care services portion of that proceeding. Section 7 provides that the government is subrogated to any right which a beneficiary referred to in s. 2 has to recover past and future costs of health care services under that section. Finally, s. 8 provides that, despite s. 2 and independent of its subrogated rights under s. 7, the government has a direct cause of action against the wrongdoer and may commence legal proceedings in its own name for the recovery of the past and future cost of health care services. [16] Section 5 of the Act prohibits a beneficiary from discontinuing or dismissing an action to which s. 3 applies without the consent of the Minister being filed in Court and provides that the Court must not make any order finally disposing of a legal proceeding referred to in s. 3(1) unless the Court is satisfied that the government has been given written notice of a commencement of a legal proceeding and written notice of the application for the order for final disposition of the proceeding. [17] In respect of actions commenced on or after the effective date of the Act, a litigant has a legal obligation to include a claim for the cost of health care services to which the government is subrogated and the government has a direct right of action to recover those health care services. [18] Section 24 relieves a litigant from the requirements of s. 3 of the Act with respect to actions commenced before the effective date but does permit the government a direct right of action. [19] In particular, s. 24(1) makes the provisions of s. 8 applicable to personal injuries suffered by a beneficiary before or after the Act came into force. However, s. 8 expressly provides that the government must not commence a legal proceeding in its own right after the expiration of six months after the expiration of a limitation period that applies to the beneficiary s right to commence a legal proceeding against the alleged wrongdoer in respect of the personal injury. Subject to any discoverability issues that limitation period is two years. Therefore on April 1, 2009 the government had a direct right of action for a health care services claim in respect

Gosselin v. Shepherd Page 6 of any injury suffered as a result of negligent conduct occurring two years and six months prior to that date, but not in respect of any claim which arose earlier. [20] In this case Ms. Gosselin s cause of action arose on June 7, 2005. Therefore the government has no direct right of action against the defendant under the Act. As Ms. Gosselin commenced her action on March 1, 2007, the provisions of s. 3, 4 and 5 of the Act do not apply to this proceeding. [21] In these circumstances the issue which arises is whether the Act permits Ms. Gosselin to amend her claim to include a health care services claim. [22] The central point of the defendants argument is that the Act should be applied retrospectively only to actions commenced after its effective date. The defendants argue that the Act does apply retrospectively to permit the government to commence its own action under s. 8 but does not apply retrospectively to permit a claim under s. 8, where the limitation date for the bringing of an action for personal injury has expired. In this case the parties agree that the limitation date for the government to bring action under s. 8 had expired prior to April 1, 2009. [23] This application requires consideration of two principles of statutory interpretation. The first is the overriding principle stated by the Supreme Court of Canada in Re: Rizzo and Rizzo Shoes Ltd., [1998] 1 S.C.R. 27 set out at para. 21 as follows: 21 Although much has been written about the interpretation of legislation (see, e.g., Ruth Sullivan, Statutory Interpretation (1997); Ruth Sullivan, Driedger on the Construction of Statutes (3rd ed. 1994) (hereinafter "Construction of Statutes"); Pierre-André Côté, The Interpretation of Legislation in Canada (2nd ed. 1991)), Elmer Driedger in Construction of Statutes (2nd ed. 1983) best encapsulates the approach upon which I prefer to rely. He recognizes that statutory interpretation cannot be founded on the wording of the legislation alone. At p. 87 he states: Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament. Recent cases which have cited the above passage with approval include: R. v. Hydro-Québec, [1997] 1 S.C.R. 213; Royal Bank of Canada v. Sparrow

Gosselin v. Shepherd Page 7 Electric Corp., [1997] 1 S.C.R. 411; Verdun v. Toronto-Dominion Bank, [1996] 3 S.C.R. 550; Friesen v. Canada, [1995] 3 S.C.R. 103. [24] The second principle of statutory construction is the presumption that in the absence of express words to the contrary a statutory change in the law is presumed not to have retrospective effect. Counsel for the defendants cited a number of decisions in support of the presumption including the decisions of the British Columbia Court of Appeal in Hornby Island Trust Committee v. Stormwell (1998), 30 B.C.L.R. (2d) 383 and Krangle (Guardian ad litem) v. Brisco 2000 BCCA 147. [25] In Krangle Chief Justice McEachern, although in dissent, summarized the underlying principle as follows: 62 There is a great deal of jurisprudence supporting this principle. It was explained in the following terms by Duff C.J.C. in Spooner Oils Ltd. v. Turner Valley Gas Conservation Board, [1933] S.C.R. 629 at 638: A legislative enactment is not to be read as prejudicially affecting accrued rights, or "an existing status" (Main v. Stark), unless the language in which it is expressed requires such a construction. The rule is described by Coke as a "law of Parliament" (2 Inst. 292), meaning, no doubt, that it is a rule based on the practice of Parliament; the underlying assumption being that, when Parliament intends prejudicially to affect such rights or such a status, it declares its intention expressly, unless, at all events, that intention is plainly manifested by unavoidable inference. 63 In Gustavson, (supra) Dickson J. at p. 282 wrote: The rule is that a statute should not be given a construction that would impair existing rights as regards person or property unless the language in which it is couched requires such a construction: Spooner Oils Ltd. v. Turner Valley Gas Conservation Board at p. 638. The presumption that vested rights are not affected unless the intention of the legislature is clear applies whether the legislation is retrospective or prospective in operation... (Emphasis added.) Dreidger, 3d ed., at 530 explains the principle as follows: To deprive individuals of existing interests or expectations that have economic value is akin to expropriation without compensation, which has never been favoured by law. To worsen the position of individuals by changing the legal rules on which they relied in arranging their affairs is arbitrary and unfair. Where the application of new legislation creates special prejudice for some, or windfalls for others, the burdens and benefits of the new law are not rationally or fairly distributed. These effects may be hard on the individuals involved and they undermine the general security and stability of the law. For these

Gosselin v. Shepherd Page 8 reasons interference with vested rights is avoided in the absence of a clear legislative directive. 64 The principle itself seems clear enough. The difficulty, however, is in identifying the kinds of rights that will be protected by the principle. Academics and others have debated this requirement in various writings but I find much more assistance in the decided cases, many of which recognize immunity from suit as a vested right. [26] In Martin v Perrie [1986] 1 SCR 41, the Supreme Court also reaffirmed the passage from Chief Justice Duff s decision in Spooner Oils Ltd v Turner Valley Gas Conservation Board [1933] SCR 629, quoted by Chief Justice McEachern in Krangle. [27] The authorities require me to read the words of the Act in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act and the intention of the legislature. It is with respect to the last consideration, that is, the intention of the legislature, that I may take into account the presumption against retrospectivity. [28] In this case, there is no question that the object of the Act is to permit the government to recover health care services costs from persons whose wrongful acts have necessitated the incurring of those health care services costs. However, it is quite clear that the legislature intended the Act to include transitional provisions. All counsel who appeared before me agreed that the Act does not give the government a direct right of action to collect health care services costs from the defendants because the limitation period set out in s. 8 expired prior to April 1, 2009. [29] Section 24 of the Act provides as follows: Application of this Act 24 (1) Subject to this section, this Act applies in relation to any personal injury suffered by a beneficiary, whether before or after this subsection comes into force. (2) The requirements of sections 3 [obligation to claim], 4 [requirement to notify government of claim] and 5 [final disposition of claim or legal proceeding] do not apply in relation to legal proceedings commenced before this subsection comes into force.

Gosselin v. Shepherd Page 9 (3) This Act does not apply in relation to health care services that are provided or are to be provided to a beneficiary in relation to (a) personal injury or death arising out of a wrongdoer's use or operation of a motor vehicle if the wrongdoer has, when the injury is caused, coverage under the plan, as those terms are defined in the Insurance (Vehicle) Act, (b) personal injury or death arising out of a tobacco related wrong as defined in the Tobacco Damages and Health Care Costs Recovery Act, or (c) personal injury or death arising out of and in the course of the beneficiary's employment if compensation is paid or payable by the Workers' Compensation Board out of the accident fund continued under the Workers Compensation Act. (4) In subsection (3) (c): [30] Section 24(1) provides that the Act applies in relation to any personal injury suffered by a beneficiary whether before or after the sub-section comes into force. However, sub-section (2) provides that the requirements of ss. (3), (4) and (5) do not apply in relation to legal proceedings commenced before the sub-section comes into force. Sub-section (2) therefore makes it clear that the plaintiff in this action has no obligation to make a health care services claim, no obligation to notify the government of a health care services claim, and no obligation to notify the government prior to the final disposition of her claim. However, if Ms. Gosselin does have a right to make a health care services claim the government is by virtue of s. 7 of the Act subrogated to any amounts recovered by her in respect of that claim. [31] The Attorney General submits that s. 24(2) of the Act exhaustively sets out all exclusions to the applicability of the Act to personal injuries which occurred before the Act came into force. Therefore any provision of the Act not expressly excluded from the provisions of s. 24(1) must be taken to be retrospective. Section 2 of the Act is not so excluded and must therefore have been intended to apply retrospectively. [32] If the Attorney General s submissions are correct s. 2 applies retrospectively to permit an amendment to add a claim for the cost of health care services in any existing action regardless of when the personal injuries were suffered.

Gosselin v. Shepherd Page 10 [33] However, as noted above, s. 24(1) deals with the application of the Act in relation to personal injuries suffered by a beneficiary whereas s. 24(2) deals with the applicability of the Act to legal proceedings. Section 24(2) excludes the application of the Act from legal proceedings commenced prior to the Act coming into force in virtually every respect. In particular such actions are not subject to the obligation to include a health care services claim, the requirement to notify the government of the existence of the claim, the requirement to notify the government of the final disposition of the claim, the obligation of the Court not to dispose of a claim without being satisfied that the government has been given written notice of the application and the right of the government to intervene in the legal proceedings. In addition, s. 20 would appear to have no application to a legal proceeding by a beneficiary which is not subject to s. 3 of the Act. [34] It is difficult to discern any reason why the legislature would have intended to permit a beneficiary to amend her action to add a claim under s. 2 but exclude that claim from the balance of the provisions of the Act dealing with the conduct of claims for the cost of health care services. It is also to be noted that s. 2(1), which permits a beneficiary to recover the cost of health care services from a wrongdoer, is made expressly subject to ss. 6, 20 and 23 of the Act. However s. 6 by its express terms applies only in relation to a legal proceeding referred to in s. 3(1). This is also the case with respect to s. 20(2) and s. 20(3) which deal only with judgments awarded in a legal proceeding referred to s. 3(1), or claims proceeded with directly by the government. [35] It seems to me that if the argument of the Attorney General is accepted the exposure of a defendant to a health care services claim will be entirely in the hands of a plaintiff and who has no obligation to make such claim and who cannot obtain any benefit from the advancement of such claim. This seems to be an anomalous result. [36] Not only is this result anomalous but it seems to me that it may well be fraught with the potential for injustice. The cost of health care services is in many

Gosselin v. Shepherd Page 11 cases very substantial. In this case, the costs exceed $200,000. The threat of amending pleadings to bring such a claim may well pressure a defendant to enter into a settlement agreement in respect of amounts that that defendant may not be justly obligated to pay. At the very least, the interpretation urged by the Attorney General will result in some defendants being exposed to claims for health care services costs and other defendants not being exposed to those costs, dependant entirely on the whim of individual plaintiffs. [37] My review of the Act leads me to conclude that it is not clearly and unambiguously intended to apply to actions commenced before the Act came into force. The presumption against retrospectivity set out in the cases referred to above together with the internal indications in the Act itself lead me to conclude that s. 2 of the Act has no application to actions commenced prior to the Act coming into force. [38] I therefore conclude that the amendment sought discloses no reasonable cause of action and dismiss the application for the amendment on that ground. [39] I would also dismiss the application to amend on the grounds that it is not just and convenient to permit such a claim to be advanced. It is clear that Ms. Gosselin will obtain no benefit from advancing the claim and has no legal obligation to do so. In these circumstances I consider the amendment to be useless and unfair to the defendants. [40] In Langret Investments S.A. v. McDonnell (1996), 21 B.C.L.R. (3d) 145 (C.A.) the court held at p. 153: Rule 24(1) of the Rules of Court in British Columbia allows a party to amend an originating process or pleading. Amendments are allowed unless prejudice can be demonstrated by the opposite party or the amendment will be useless. The rationale for allowing amendments is to enable the real issues to be determined. The practice followed in civil matters when amendments are sought fulfils the fundamental objective of the civil rules which is to ensure the just, speedy and inexpensive determination of every proceeding on the merits. See McLachlin and Taylor, British Columbia Practice (2nd Ed.) pp. 24-1 to 24-2-10, and the (7 decision of this Court in Chavez v. Sundance Cruises Corp. (1993), 15 C.P.C. (3d) 305, 309-10.

Gosselin v. Shepherd Page 12 [41] In my view the proposed amendments to the statement of claim are useless in that they provide no personal benefit to the plaintiff since any amount recovered by the plaintiff as a result of the amendments would be held in trust and ultimately paid to the government. [42] Ms. Gosselin feels that she has a moral obligation to pursue a claim to recover the health care services costs. However I do not consider it to be appropriate for the Court to impose moral obligations on defendants. The legislature has set out the circumstances in which the government is entitled to recover the cost of health care services. I do not consider it to be just to the defendants to put them uniquely in the position of being exposed to a claim that others in the same situation will not be required to answer. [43] The application to amend is therefore dismissed. [44] As between the plaintiff and defendants the costs will be in the cause. [45] There will be no costs awarded to or against the Attorney General. The Honourable Mr. Justice Sewell