Page: 1 PROVINCE OF PRINCE EDWARD ISLAND PRINCE EDWARD ISLAND COURT OF APPEAL

Page: 1 PROVINCE OF PRINCE EDWARD ISLAND PRINCE EDWARD ISLAND COURT OF APPEAL Citation: Hubley v. Hubley Estate 2011 PECA 19 Date: 20111124 Docket: S1-CA-1211 Registry: Charlottetown BETWEEN: AND: DENISE HUBLEY APPELLANT THE PUBLIC TRUSTEE AS LITIGATION ADMINISTRATOR OF THE ESTATE OF PHILIP DOUGLAS HUBLEY RESPONDENT Before: Chief Justice David H. Jenkins Justice John A. McQuaid Justice Michele M. Murphy Appearances: Bruce W. Evans, counsel for the Appellant Tracey L. Clements, Q.C., and Rosemary Scott, Q.C., counsel for the Respondent Place and Date of Hearing Place and Date of Judgment Charlottetown, Prince Edward Island June 1, 2011 Charlottetown, Prince Edward Island November 24, 2011 Written Reasons by: Justice John A. McQuaid Concurred in by: Chief Justice David H. Jenkins Justice Michele M. Murphy

Page: 2 PRACTICE - Pleadings - Statement of claim - Striking out pleadings - grounds, failure to disclose a cause of action TORTS - Negligence - Duty of care, particular relationships The appellant commenced an action against the respondent - the estate of her late husband. Among the claims set forth in her statement of claim were claims that she suffered damages as the result of the death of her husband in a motor vehicle accident which was caused by his negligence. The respondent made a motion in the Supreme Court to strike those claims from the statement of claim on the grounds that the claims for these damages did not disclose a reasonable cause of action in negligence. The motion was granted and the appellant appealed to the Court of Appeal. The appeal was dismissed. The Court of Appeal held that the appellant s late husband did not owe her a prima facie duty of care not to cause injury or death to himself. Accordingly, the motions judge was correct when he concluded the appellant did not have a reasonable cause of action in negligence to recover the damages she alleged she suffered as the result of her husband s death. Authorities Cited: CASES CONSIDERED: R. v. Imperial Tobacco Canada Ltd. 2011 SCC 42; Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959 (SCC); Kamloops (City of) v. Nielsen, [1984] 2 S.C.R. 2 (SCC); Cooper v. Hobart, [2001] 3 S.C.R. 537 (SCC); Anns v. Merton London Borough Council, [1978] A.C. 728; Syl Apps Secure Treatment Centre v. B.D. 2007 SCC 38; [2007] 3 S.C.R. 263; Fraser v. Westminer Canada Ltd. 2003 NSCA 76; Canadian National Railway Co. v. Norsk Pacific Steamship Co., [1992] 1 S.C.R. 1021 (SCC); Canadian National Railway v. Norsk Pacific Steamship Co. (1990), 65 D.L.R. (4 th ) 321(FCA); Martel Building Ltd. v. Canada 2000 SCC 60; [2000] 2 S.C.R. 860 (SCC) STATUTES CONSIDERED: Survival of Actions Act, R.S.P.E.I. 1988 Cap. S-11; Fatal Accidents Act, R.S.P.E.I. 1988 Cap. F-5 RULES CONSIDERED: Prince Edward Island Rules of Civil Procedure, Rule 21, 21.01(1), 21.01(1)(b) Reasons for judgment: McQUAID J.A.: INTRODUCTION [1] On June 28, 2004, there was a collision between two motor vehicles at the

Page: 3 intersection of Routes 4 and 5 in Prince Edward Island. The appellant, Denise Hubley, was a passenger in the motor vehicle driven by her husband, Phillip Douglas Hubley. The collision was caused by the negligence of Mr. Hubley. As a result of the accident, the appellant suffered personal injuries, and Mr. Hubley died on July 12, 2004. [2] On April 6, 2006, the appellant commenced an action in the Supreme Court of Prince Edward Island by issuing a statement of claim against the respondent, the Estate of Phillip Douglas Hubley. The statement of claim was amended on April 20, 2006. [3] In the amended statement of claim the appellant seeks to recover damages for the losses she sustained as the result of her personal injuries. She also claims damages for the losses she suffered resulting from her husband s death. The particulars of these last mentioned claims are set forth in paragraphs 11 and 11A of the amended statement of claim which read as follows: 11. As a result of the negligence of Philip, the Plaintiff sustained economic losses, including the loss of benefits to her from Philip s employment earnings and Philip s retirement pension benefits. 11A. As a result of the negligence of Philip, the Plaintiff has lost the care, guidance and companionship of her husband, Philip. [4] On October 29, 2009, the respondent made a motion in the Supreme Court for an order pursuant to Rule 21.01(1)(b) of the Rules of Court to strike out paragraphs 11 and 11A of the amended statement of claim. The grounds for the motion were that these claims do not disclose a reasonable cause of action against the respondent. [5] Campbell J. heard the motion and on September 7, 2010, he issued reasons for judgment granting the motion. See: Hubley v. Hubley Estate 2010 PESC 38; (2010), 307 Nfld. & P.E.I.R. 323; (2010), 324 D.L.R. (4th) 69. On November 19, 2010, an order was filed in the Supreme Court striking paragraphs 11 and 11A from the amended statement of claim as well as any claim for damages made in connection with the allegations in those paragraphs, including those claims in paragraphs 1(j) and 1(k) of the amended statement of claim. The appellant was also ordered to pay the respondent's costs of the motion. [6] The appellant filed a notice of appeal in this Court on December 15, 2010. She requests that the order of the motions judge be set aside and that the court reinstate the claims set forth in paragraphs 11 and 11A of the amended statement of claim as well as the related claims referred to above. DISPOSITION

Page: 4 [7] I would dismiss the appeal and confirm the order of the motions judge. GROUNDS OF APPEAL [8] The appellant relies on ten grounds of appeal. Furthermore, the second ground of appeal includes reliance upon five principles which the appellant argues were applicable to the issues in the motion and which she asserts the motions judge either ignored or addressed incorrectly. [9] Many of the grounds of appeal, including the five principles, relate to whether there exists in law a reasonable cause of action for loss of shared family income, loss of care, guidance and companionship, non-pecuniary loss, as well as losses under the Survival of Actions Act, R.S.P.E.I. 1988 Cap. S-11, and the Fatal Accidents Act, R.S.P.E.I. 1988 Cap. F-5. [10] I do not take issue with many of the five principles stated by the appellant in the second of the ten grounds of appeal, and I do not take issue with many of the other general principles in the other grounds of appeal. However, I cannot accept they assist the appellant in establishing a reasonable cause of action in negligence against the respondent to recover the losses in the impugned paragraphs of the amended statement of claim. [11] In my opinion, the issue in this appeal is not whether the appellant has a reasonable cause of action in negligence to recover the losses referred to above against a party who caused injury or death to her husband. The above statutes and the common law make it clear that such a cause of action exists. [12] The facts as pleaded in the amended statement of claim and as they relate to the impugned paragraphs of the amended statement of claim do not disclose that the appellant's claims in paragraphs 11 and 11A of the amended statement of claim are of this nature. The impugned claims arise from the appellant's allegations that Mr. Hubley suffered a loss of life, which was caused by his own negligence, and this resulted in losses to her. She alleges that her husband owed her a duty of care not to cause injury or death to himself, and she has a reasonable cause of action in negligence against the respondent. [13] The appellant also asserts that the category of relationship between she and her late husband - she as the passenger in the vehicle and he as the driver of that motor vehicle - has been recognized by judicial authority as giving rise to a duty of care on her late husband to protect her from all losses she suffered as the result of his negligence, including the losses she suffered as the result of his death.

Page: 5 [14] The respondent, on the other hand, asserts there was no duty of care on the appellant s late husband to protect her from his negligent act of causing his own death. According to the respondent s position, there is no proximity between the negligent act of the late Mr. Hubley and the types of losses claimed by the appellant in paragraphs 11 and 11A of the amended statement of claim. ISSUE [15] Therefore, the central ground of appeal and thus the central issue in this appeal relates to whether the motions judge erred in finding that the late Mr. Hubley did not owe the appellant a prima facie duty of care to protect himself from injury and/or death. [16] This issue raises a question of law. The order of the motions judge is, therefore, reviewable by this Court on the standard of correctness. DISPOSITION 1. Rule 21 of the Rules of Court [17] Rule 21.01(1) of the Rules of Court provides as follows: 21.01(1) A party may move before a judge, (a) (b) for the determination, before trial, of a question of law raised by a pleading in an action where the determination of the question may dispose of all or part of the action, substantially shorten the trial or result in a substantial saving of costs; or to strike out a pleading on the ground that it discloses no reasonable cause of action or defence, and the judge may make an order or grant judgment accordingly. (2) No evidence is admissible on a motion, (a) (b) under clause (1)(a), except with leave of a judge or on consent of the parties; under clause (1)(b). [18] Pursuant to Rule 21.01, a party may move to strike a pleading, or any part of a

Page: 6 pleading that does not disclose a reasonable cause of action or a reasonable defence. A pleading may fail to disclose a reasonable cause of action or defence if it does not contain sufficient material facts which, if proven at trial, would constitute at law a cause of action or defence. [19] Parties are not entitled to present evidence in support of or in opposition to the motion because the material facts as pleaded in the relevant pleading are accepted as being capable of proof at trial. It is crucial that the material facts necessary to prove the claim or sustain the defence are pleaded. At trial it may be determined these facts are incapable of proof; however, they must be pleaded as the party relying on the pleading does not have the opportunity on the presentation of the motion to assert that the material facts will be subsequently pleaded or brought forward at trial. [20] Recently the Supreme Court of Canada addressed this question in the context of a rule in the British Columbia Supreme Court which is analogous to Rule 21.01(1)(b). In R. v. Imperial Tobacco Canada Ltd. 2011 SCC 42, McLachlin C.J.C. writing for the Court stated at paragraph 22: 22. It is incumbent on the claimant to clearly plead the facts upon which it relies in making its claim. A claimant is not entitled to rely on the possibility that new facts may turn up as the case progresses. The claimant may not be in a position to prove the facts pleaded at the time of the motion. It may only hope to be able to prove them. But plead them it must. The facts pleaded are the firm basis upon which the possibility of success of the claim must be evaluated. If they are not pleaded, the exercise cannot be properly conducted. [21] Before the court may strike a pleading or any part of a pleading, it must be plain and obvious the pleading or the part sought to be struck does not disclose a reasonable cause of action or defence in fact or law. The length or complexity of the proceeding or the novelty of the cause of action are not factors which weigh in the court's consideration as to whether the pleading should be struck. See: Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959 (SCC) at p. 978. [22] In the case at bar there is no dispute as to the sufficiency of the facts pleaded in the Amended Statement of Claim. The issue in this appeal turns on whether in law, accepting the material facts pleaded in the statement of claim as proven, the appellant has a reasonable cause of action against the respondent for the impugned claims. [23] There is no question the appellant has a reasonable cause of action in negligence against the respondent to recover the losses resulting from the personal injuries she suffered in the accident. All paragraphs in the amended statement of claim, other than paragraphs 11 and 11A, set forth the particulars of these claims.

Page: 7 They were not challenged by the respondent on the motion and thus they are not in issue in this appeal. [24] However, the appellant claims she suffered losses as the result of the death of Mr. Hubley in addition to the losses she suffered as the result of her personal injuries. She alleges that she suffered a loss because, for example, she no longer has the benefit of his employment income and pension benefits. She also alleges she suffered the loss of his care, guidance and companionship. For purposes of the motion pursuant to Rule 21.01(1), the court must accept as fact that she has suffered these losses, that she can quantify them and that at trial they will be proven. [25] Speaking generally, an injured party does not have a reasonable cause of action in negligence unless the person who caused the injury owed the injured party a prima facie duty of care. There is no question Mr. Hubley owed a duty of care to all passengers in his vehicle, including the appellant, to protect them from injuries which result from his negligent operation of the motor vehicle. The question is whether he owed them a duty of care to protect them from losses which resulted from injuries or death to him. [26] If he did, the impugned claims establish a reasonable cause of action in law, and they are entitled to remain in the amended statement of claim. If he did not, the claims do not constitute a reasonable cause of action in law, and the motions judge was correct in striking them from the amended statement of claim. 2. Negligence and duty of care [27] It is now trite law that for a plaintiff s claim against a defendant to disclose a reasonable cause of action in negligence, the defendant must owe the plaintiff a duty of care. The approach to be taken by the court is assessing whether a duty of care is owed by a defendant to a plaintiff is set forth in the decision in Kamloops (City of) v. Nielsen, [1984] 2 S.C.R. 2 (SCC). In accordance with this approach the court must address whether the plaintiff s loss was foreseeable by the defendant and whether there is a sufficient relationship of proximity or neighborhood such that in the reasonable contemplation of the defendant, carelessness on his part would likely cause damage to the plaintiff. If the finding on these issues is positive, the court finds there is a prima facie duty of care owed by the defendant to the plaintiff subject to a consideration of the second part of the test, that is, whether there are any residual policy concerns which would negate a prima facie duty of care. [28] In Cooper v. Hobart, [2001] 3 S.C.R. 537 (SCC), the Court recognized that in the future, as cases come before courts, there will be categories of relationships where, in previous cases, the court imposed a duty of care. The Court also confirmed

Page: 8 the steps in Kamloops which had been adopted from the decision of the House of Lords in Anns v. Merton London Borough Council, [1978] A.C. 728. At paragraph 30 and 31 of the decision in Cooper v. Hobart, McLachlin C.J.C. stated as follows: [30] In brief compass, we suggest that at this stage in the evolution of the law, both in Canada and abroad, the Anns analysis is best understood as follows. At the first stage of the Anns test, two questions arise: (1) was the harm that occurred the reasonably foreseeable consequence of the defendant's act? and (2) are there reasons, notwithstanding the proximity between the parties established in the first part of this test, that tort liability should not be recognized here? The proximity analysis involved at the first stage of the Anns test focuses on factors arising from the relationship between the plaintiff and the defendant. These factors include questions of policy, in the broad sense of that word. If foreseeability and proximity are established at the first stage, a prima facie duty of care arises. At the second stage of the Anns test, the question still remains whether there are residual policy considerations outside the relationship of the parties that may negative the imposition of a duty of care. It may be, as the Privy Council suggests in Yuen Kun Yeu, that such considerations will not often prevail. However, we think it useful expressly to ask, before imposing a new duty of care, whether despite foreseeability and proximity of relationship, there are other policy reasons why the duty should not be imposed. [31] On the first branch of the Anns test, reasonable foreseeability of the harm must be supplemented by proximity. The question is what is meant by proximity. Two things may be said. The first is that "proximity" is generally used in the authorities to characterize the type of relationship in which a duty of care may arise. The second is that sufficiently proximate relationships are identified through the use of categories. The categories are not closed and new categories of negligence may be introduced. But generally, proximity is established by reference to these categories. This provides certainty to the law of negligence, while still permitting it to evolve to meet the needs of new circumstances. [29] As McLachlin C.J.C. points out, at the first stage of the Anns/Kamloops test it is not sufficient to focus only on whether the injuries and losses to the plaintiff were foreseeable on the part of the defendant, the court must also consider whether the relationship between the defendant's negligent act and the plaintiff's alleged loss is sufficiently proximate to make it just and fair to impose a prima facie duty of care on the defendant. Therefore, the court must find both foreseeability of harm and proximity of the parties. [30] In considering whether the relationship is sufficiently proximate to give rise to

Page: 9 a prima facie duty of care, the court considers first, whether the type of relationship in issue has been previously found to give rise to a duty of care. If it has, a prima facie duty of care is established subject to a consideration of the second part of the test, namely, whether there are residual policy considerations which would negate the prima facie duty of care. [31] If the relationship between the parties has not been previously considered as giving rise to a duty of care, the court must determine, considering the relationship in issue, whether it should create a new category of relationship which would give rise to a prima facie duty of care. The court will consider a number of factors, including the expectations of the parties, representations made and reliance on those representations as well as the property or other interests involved. The factors are diverse and there is no single factor which is determinative of whether the relationship is sufficiently proximate. Generally, the factors are those which assist the court in determining the closeness of the relationship and whether it would be just and fair to impose a duty of care in the context of that relationship. See: Cooper v. Hobart at paragraphs 34 and 35. [32] In Syl Apps Secure Treatment Centre v. B.D. 2007 SCC 38; [2007] 3 S.C.R. 263, Abella J. stated that policy concerns enter into the consideration of the proximity analysis at the first stage of the Anns/Kamloops test. These policy concerns are different from those under consideration at the second stage of the test in that they are policy concerns which relate only to the particular relationship. At the second stage of the test, the court's focus is not on the specific relationship but on whether there are residual policy concerns which would negate the prima facie duty of care. These are policy concerns which relate to external factors and a consideration whether, generally, at law it would be fair and just to impose a prima facie duty of care. [33] I agree with the motions judge that the case at bar does not fit into any of the existing categories of negligence law in which proximity has been found. The relationship is not, as the appellant argues, a relationship between the negligent act of the driver of a motor vehicle and the injuries suffered by a passenger in that or another motor vehicle. [34] The category of relationship raised by the impugned claims is between the negligent driver and his spouse who sustained losses attributable solely to the negligent driver s death. This is not a category of relationship where the courts in previous cases have determined there is sufficient proximity to give rise to a prima facie duty of care upon the negligent driver. [35] The necessity of first determining if an alleged wrongdoer owed a victim a duty of care serves as a mechanism by which the court controls the potential for unlimited

Page: 10 liability in negligence law. Not every negligent act imposes liability for the losses of all who may have suffered as the result of the negligent act. As I stated at the outset of this discussion, the alleged wrongdoer must owe a duty of care to the victim before negligence will be established. See: Fraser v. Westminer Canada Ltd. 2003 NSCA 76 at paragraph 43. [36] In cases where the loss claimed is purely economic, that is where the plaintiff has not suffered any personal injury, the concept of duty of care takes on additional significance. In Fraser v. Westminer at paragraph 26 Cromwell J.A. defined pure economic loss as " financial loss which was not causally consequent upon physical injury " to the plaintiffs or their property. [37] Historically courts were reluctant to award damages where the loss was purely economic without physical injury or damage to the plaintiff. While the underlying concept of compensating a person for a loss which is the fault of another would dictate that where the fault is negligence, based on the duty one should reasonably foresee as being owed to the injured party, courts realized that for practical and pragmatic reasons there would have to be additional limits when the claim was for pure economic loss. This is so because the potential for an indeterminate scope of liability is greater when the claim is that the negligence caused pure economic loss. [38] The seminal case addressing when a duty of care is created, where the claim is for pure economic loss, is Canadian National Railway Co. v. Norsk Pacific Steamship Co., [1992] 1 S.C.R. 1021 (SCC). In this case the railway brought an action against the steamship company alleging it suffered losses which resulted from the steamship company's negligence while towing a barge damaged a bridge owned by a third party. The railway leased the bridge from the third party, and its losses arose because it was unable to use the bridge as the result of the damage it sustained. The property of the railway did not suffer any physical damage nor did any of its employees suffer personal injury. Its losses were, therefore, purely economic as the result of not being able to use the bridge after the accident. [39] The issue was whether the steamship company owed the railway a duty of care, and thus, whether it was liable to the railway company in negligence for the economic losses. McLachlin J. stated that the proximity inquiry becomes important in determining whether it would be just and fair to impose a duty of care. [40] She quoted the following passage from an English case which was relied upon by MacGuigan J.A. in the Federal Court of Appeal decision under appeal to the Supreme Court of Canada. See: Canadian National Railway v. Norsk Pacific Steamship Co. (1990), 65 D.L.R. (4 th ) 321. This passage explains proximity and its place in the application of the duty of care analysis as the controlling limit on the

Page: 11 imposition of liability when the fault of a defendant is framed in negligence. McLachlin J. states as follows: [255] The doctrinal inquiry introduces considerations which the cases have traditionally treated under the concept of proximity. Proximity may be usefully viewed, not so much as a test in itself, but as a broad concept which is capable of subsuming different categories of cases involving different factors. Deane J. in Sutherland Shire Council v. Heyman (1985), 60 A.L.R. 1, at pp. 55-56, in a passage cited by MacGuigan J.A., in the judgment below at p. 165, describes proximity as follows: The requirement of proximity is directed to the relationship between the parties in so far as it is relevant to the allegedly negligent act or omission of the defendant and the loss or injury sustained by the plaintiff. It involves the notion of nearness or closeness and embraces physical proximity (in the sense of space and time) between the person or property of the plaintiff and the person or property of the defendant, circumstantial proximity such as an overriding relationship of employer and employee or of a professional man and his client and what may (perhaps loosely) be referred to as causal proximity in the sense of the closeness or directness of the causal connection or relationship between the particular act or course of conduct and the loss or injury sustained. It may reflect an assumption by one party of a responsibility to take care to avoid or prevent injury, loss or damage to the person or property of another or reliance by one party upon such care being taken by the other in circumstances where the other party knew or ought to have known of that reliance. Both the identity and the relative importance of the factors which are determinative of an issue of proximity are likely to vary in different categories of case. That does not mean that there is scope for decision by reference to idiosyncratic notions of justice or morality or that it is a proper approach to treat the requirement of proximity as a question of fact to be resolved merely by reference to the relationship between the plaintiff and the defendant in the particular circumstances. The requirement of a relationship of proximity serves as a touchstone and control of the categories of case in which the common law will adjudge that a duty of care is owed. Given the general circumstances of a case in a new or developing area of the law of negligence, the question what (if any) combination or combinations of factors will satisfy the requirement of proximity is a question of law to be resolved by the processes of legal reasoning, induction and deduction. On the other hand, the identification of the content of that requirement in such an area should not be either

Page: 12 ostensibly or actually [page1152] divorced from notions of what is "fair and reasonable..." [41] McLachlin J. summarized the applicable law in this manner at paragraph 258 of Norsk: [258] In summary, it is my view that the authorities suggest that pure economic loss is prima facie recoverable where, in addition to negligence and foreseeable loss, there is sufficient proximity between the negligent act and the loss. Proximity is the controlling concept which avoids the spectre of unlimited liability. Proximity may be established by a variety of factors, depending on the nature of the case. To date, sufficient proximity has been found in the case of negligent misstatements where there is an undertaking and correlative reliance (Hedley Byrne); where there is a duty to warn (Rivtow); and where a statute imposes a responsibility on a municipality toward the owners and occupiers of land (Kamloops). But the categories are not closed. As more cases are decided, we can expect further definition on what factors give rise to liability for pure economic loss in particular categories of cases. In determining whether liability should be extended to a new situation, courts will have regard to the factors traditionally relevant to proximity such as the relationship between the parties, physical propinquity, assumed or imposed obligations and close causal connection. And they will insist on sufficient special factors to avoid the imposition of indeterminate and unreasonable liability. The result will be a principled, yet flexible, approach to tort liability for pure economic loss. It will allow recovery where recovery is justified, while excluding indeterminate and inappropriate liability, and it will permit the coherent development of the law in accordance with the approach initiated in England by Hedley Byrne and followed in Canada in Rivtow, Kamloops and Hofstrand. [42] The relevant proximity of relationship is that which exists between the acts of the negligent actor and the loss suffered by the victim. In determining whether the relationship is sufficiently proximate, the court is required to assess the relationship between the parties to the extent that relationship is relevant to the negligent act or omission of a defendant and the loss suffered by a plaintiff. It is not enough to assess the proximity of the relationship between the parties simply on the basis of their physical closeness or marital relationship without regard to the nature of the negligent act or omission and the nature of the loss suffered. [43] At paragraph 261 McLachlin J. stated: [261] In many of the cases discussed above, the judiciary has focused upon the relationship between the tortfeasor and the plaintiff as an indication of proximity, a focus closely related to the foreseeability

Page: 13 analysis inherent to all negligence actions. In the classic case of Hedley Byrne, the reliance analysis focuses upon the connection between the party who made the negligent misstatement and the injured party, i.e., is that plaintiff a party that the tortfeasor ought reasonably to have foreseen would rely on his or her statement? The judgments below focused on the relationship between the tortfeasor Norsk and the plaintiff CN both within and outside their discussion of proximity. A more comprehensive, and I submit objective, consideration of proximity requires that the court review all of the factors connecting the negligent act with the loss; this includes not only the relationship between the parties but all forms of proximity -- physical, circumstantial, causal or assumed indicators of closeness. While it is impossible to define comprehensively what will satisfy the requirements of proximity or directness, precision may be found as types of relationships or situations are defined in which the necessary closeness between negligence and loss exists. [44] McLachlin J. continued at paragraph 262 by stating that because proximity is in and of itself concerned with policy (the justness and fairness of imposing liability) the court is required to review, considering the nature of the relationship, the purposes served by permitting recovery and the imposition of a duty of care for pure economic loss. The implication being that policy considerations can be taken into account at the first step of the Anns/Kamloops test as subsequently held by the Court in Syl Apps. [45] In Martel Building Ltd. v. Canada 2000 SCC 60; [2000] 2 S.C.R. 860 (SCC) at paragraphs 36 and 37, the Court reaffirmed that it should proceed with caution in allowing recovery for economic loss when the plaintiff had suffered neither physical harm nor property damage. Also see: Fraser v. Westminer at paragraph 44. 3. Application of the law to the relevant pleadings [46] The appellant takes the position that because she suffered personal injury, the impugned claims are for consequential economic loss and not pure economic loss. I am unable to agree. First, there is no causal connection between her personal injuries and the losses she claims in the impugned claims. The latter arise from the death of her husband and not from her personal injuries. [47] Second, as the motions judge noted there is a certain lack of consistency in this argument. As the motions judge stated at paragraph 25 of his reasons: [25] In the circumstances before the court, the Plaintiff wife claims she can recover from her husband's estate for relational economic loss because she suffered some physical injury as well as economic loss. In my view, it is illogical to suggest that if she escaped any physical injury, she would be barred from recovering for the loss of

Page: 14 care, guidance and companionship, but if she so much as cut her finger or bruised her toe, she could recover. [48] The appellant also argues that because she was a passenger in the car the late Mr. Hubley drove negligently and because she is his spouse, there is sufficient proximity to establish a prima facie duty of care on him to not cause his own death. While this relationship is important in assessing the sufficiency of the proximity, reliance on it alone overlooks the purpose of proximity as applied in the duty of care analysis; the focus must also be on the closeness between the defendant s negligent act and the plaintiff s loss. [49] I agree with respondent's counsel that the essence of the appellant's position is that because her husband drove the car negligently, she is entitled to recover full compensation, that is, all pecuniary and non-pecuniary losses resulting from his negligence. This position if adopted would completely overlook the purpose of the duty of care analysis which serves to govern the scope of liability in causes of action founded in negligence and the loss suffered is a pure economic loss. [50] In this case, and particularly in the context of the impugned paragraphs of the amended statement of claim, the circumstances are these. The negligent act is Mr. Hubley's driving which caused his own death. The loss is the appellant's loss of economic and other intangible benefits the appellant would have enjoyed had Mr. Hubley not died as the result of his own negligence. The issue is whether there is sufficient proximity between this negligent act and these types of losses to make it just and fair to impose upon Mr. Hubley a prima facie duty of care. [51] Contrast this with the question as to whether there is sufficient proximity between the appellant and Mr. Hubley to impose upon him a prima facie duty of care not to cause injury to the appellant. The negligent act is the careless driving of Mr. Hubley and the loss is the personal injury suffered by the appellant. In this situation, there is a direct relationship between the negligent act of the late Mr. Hubley and the appellant s loss. [52] On the facts as pleaded in the amended statement of claim as they relate to the loss claimed in the two impugned paragraphs, there is not a direct relationship between the negligent act and the loss suffered by the appellant. The intervening fact is the death of Mr. Hubley which breaks the chain of proximity. The losses claimed by the appellant flow from his death and not her injuries. [53] The recognition of a new duty of care in circumstances similar to those of the case at bar may have far-reaching policy consequences, the most significant being the prospect of indeterminate liability. It could lead to complex and unsettled questions

Page: 15 as to how people lead their lives. Questions will arise as to which family members could sue. The liability could extend to not only self-inflicted death but as well self-inflicted injury. There will be issues as to the nature of the damages that could be claimed. There could be a whole range of situations giving rise to law suits ranging from one's failure to wear a seat belt to risking one's own health by lifestyle choices. [54] Another significant question is how the imposition of a duty of care in these circumstances would impact on one's right to self-determination and freedom of choice. [55] Therefore, considering the first stage of the Anns/Kamloops test, there is an insufficient proximity of relationship to impose a prima facie duty of care on the late Mr. Hubley not to cause his death. In the circumstances of the facts as pleaded in the amended statement of claim, and as those facts relate to the impugned paragraphs, it would be unfair and unjust to impose such a duty of care on the late Mr. Hubley. [56] If the claim for loss of care guidance and companionship is to be treated separately from the claim for pure economic loss, I agree with the motions judge that on the Cooper v. Hobart test, the late Mr. Hubley did not owe the appellant a prima facie duty of care in this respect. 4. The application of Rule 21 [57] The appellant argues that because proximity deals with policy at the first stage of the Anns/Kamloops test and because the second stage of the test is concerned with residual policy issues, the court should not resolve the issue of whether there was a prima facie duty of care on a Rule 21 motion to strike the impugned paragraphs of the amended statement of claim. The appellant argues that facts need to be presented and thus the issue of duty of care should not be resolved until after a trial is held. [58] With respect I do not agree. The issue of proximity, so vital to the determination of whether a new duty of care should be recognized, arises as a question of law where a number of factors and the combination of those factors are assessed to determine if the necessary proximity has been established. The issue " is a question of law to be resolved by the process of legal reasoning, induction and deduction." See: Norsk at paragraph 255. [59] Therefore, utilizing the facts as pleaded in the impugned pleading, all of which are, for purposes of the motion to strike, accepted as true, the court can apply the law. In doing so, the court can assess whether the late Mr. Hubley owed the appellant a prima facie duty of care to protect her from any losses she may have suffered from his death and thus whether her claims against his estate for these losses disclose a

reasonable cause of action in negligence. 5. Conclusion and costs Page: 16 [60] In conclusion, I would dismiss the appeal and award the respondent costs of the appeal on a partial indemnity basis. If the parties are unable to agree on costs, the respondent shall file submissions on costs within 30 days of these reasons and the appellant shall have 30 days to respond to those submissions. Justice John A. McQuaid I AGREE: Chief Justice David H. Jenkins I AGREE: Justice Michele M. Murphy