Nova Scotia (Attorney General) v. Arrow Construction Products Ltd.

Nova Scotia (Attorney General) v. Arrow Construction Products Ltd. Court Court of Appeal Date 1996-02-23 Citation 1996 NSCA 4 Docket CA 122976 Judge/Registrar/Adjudicator Bateman, Nancy J. (Honourable Justice) (CA) Document Type Decision Decision Content C.A. No. 122976 NOVA SCOTIA COURT OF APPEAL Cite as Nova Scotia (Attorney General) v. Arrow Construction Products Ltd. , 1996 NSCA 4 BETWEEN: ATTORNEY GENERAL OF NOVA SCOTIA ) Alexander M. Cameron ) for the Appellant Appellant ) ) - and - ) ) Stewart McInnes, Q.C. ) for the Respondent ) (not appearing) ARROW CONSTRUCTION PRODUCTS ) LIMITED ) Gregory H. Cooper ) for the Intervenor ) Respondent ) Application Heard: ) February 22, 1996 - and - ) ) CONSTRUCTION ASSOCIATION OF ) Decision Delivered: NOVA SCOTIA ) February 23, 1996 ) Intervenor ) ) ) ) ) ) ) ) ) ) ) ) ) BEFORE THE HONOURABLE JUSTICE BATEMAN IN CHAMBERS BATEMAN, J.A.: This is an application by the Construction Association of Nova Scotia (CANS) for leave to intervene in an appeal proceeding. The Department of Supply and Services of Nova Scotia had called for tenders for the repair of the roofs of two government buildings. The tender specifications required that a specific roofing system be used. The respondent, Arrow Construction, the supplier of a competitor's roofing system asked the government to open the tender specifications to include that product. This was done by an addendum to the original call for tenders. Tenders were submitted, including one from a contractor intending to purchase the respondent's product, if successful on the bid. The respondent alleged, and the trial judge accepted, that the contractor who intended to use the respondent's product, had submitted the lowest bid. Another contractor was awarded the tender. The respondent sued the Government of Nova Scotia alleging negligent misrepresentation, breach of duty of care and breach of contract arising from the government's failure to award the tender to the lowest bidder. In finding in favour of the respondent, the trial judge made a number of adverse comments and negative findings about the government tendering system in place in Nova Scotia. The government has appealed that decision. CANS seeks leave to intervene in that appeal. The appellant opposes the application to intervene. The respondent takes no position. Jurisdiction: A judge of this court, sitting alone, has jurisdiction to grant leave to intervene, as was held by Chipman, J. A. in R. v. K.A.R. (1992), 116 N.S.R.(2d) 418 (S.C.A.D., Chambers). Civil Procedure Rule 8, which is directed to the intervention of third parties, is the governing provision, through the operation of Civil Procedure Rules 62.31(1) and 65.03. Analysis: Civil Procedure Rule 8 provides, in part: 8.01.(1) Any person may, with leave of the court, intervene in a proceeding and become a party thereto where, (a) he claims an interest in the subject matter of the proceeding, including any property seized or attached in the proceeding whether as an incident to the relief claimed, enforcement of the judgment therein, or . . . (3) On the application, the court shall consider whether the intervention will unduly delay or prejudice the adjudication of the rights of the parties to the proceeding and it may grant such order as it thinks just. The textbook, The Conduct of an Appeal, by Sopinka and Gelowitz, (Toronto: Butterworths) at p. 187‑8, summarizes the matters usually considered by a court of appeal on such applications: In considering an application to intervene, appellate courts will consider: (1) whether the intervention will unduly delay the proceedings; (2) possible prejudice to the parties if intervention is granted; (3) whether the intervention will widen the lis between the parties; (4) the extent to which the position of the intervener is already represented and protected by one of the parties; and (5) whether the intervention will transform the court into a political arena. As a matter of discretion, the court is not bound by any of these factors in determining an application for intervention but must balance these factors against the convenience, efficiency and social purpose of moving the case forward with only the persons directly involved in the lis. [footnotes omitted] (a) An interest in the subject matter of the proceeding: According to the affidavit filed, CANS is an organization that represents the general interests of the non-residential 'construction industry' of Nova Scotia. I am satisfied that it does not represent all members of the construction industry, broadly defined, nor is it the only organization representing members of the construction industry. It is, however, a broadly based group whose members, collectively, do a substantial amount of business through the government tendering process. I am satisfied, as well, that CANS has a longstanding interest and expertise in the tendering process in this Province. The appellant submits that CANS does not have the necessary interest in the "subject matter" of this appeal to warrant intervenor status. The major issues, submits the appellant, are narrow: "whether the Department owed the respondent a duty of care; whether the Department's representations were false or misleading; and whether the Department's misrepresentations were negligent". The subject matter, he submits, is contract and tort law, between private parties. The appellant further submits that, as CANS does not speak for all members of the construction industry, to permit intervention by CANS would result in the presentation of an unbalanced perspective on the tendering process. All members of the construction industry do not necessarily speak with one voice, or hold a single view on the tendering process. Indeed, some members of the construction industry may hold views that differ substantially from those expressed by CANS. All provinces in Canada do not have the equivalent of our Civil Procedure Rule 8. In those provinces, applications to intervene are determined on common law principles. In particular, British Columbia has no governing rule. Recognizing that limitation, however, there is guidance to be had in the jurisprudence from other provincial jurisdictions. In U.T.U., Locals 1778 v. BC Rail Ltd., (B.C.C.A., Chambers), reported on Quicklaw as [1990] B.C.J. No. 2503, Proudfoot J.A. in considering an application to intervene, at p. 6, adopted the following comment from Locke, J.A. in Guadagni v. Workers' Compensation Board of British Columbia and B.C. Federation of Labour: As a result of the above authorities, I conclude that no special corporate form or structure is necessary in order to procure intervention beyond the fact that it must have a broad representative base. I am satisfied that CANS' objects are broad enough to include intervention in a legal proceeding where to do so is in the interests of its membership. I am satisfied, as well, that it has a broad representative base. Most commonly, absent a legal interest in common (see C.P. Rule 8.01(1)(b)), intervention is granted where the intended intervenor has a direct stake, usually financial, in the outcome. CANS acknowledges that it does not have a direct financial stake in the outcome of this proceeding. A direct financial interest, while of assistance in qualifying an applicant to intervene, is not, however, a requirement. In Re Schofield et al., (1980), 112 D.L.R. (3d) 132 at 141, (Ont. C.A.), Thorson, J.A., contemplated an application to intervene by a similarly situated applicant, having no legal rights or obligations at stake: . . . one can envisage an applicant with no interest in the outcome of an appeal in any such direct sense but with an interest, because of the particular concerns which the applicant has or represents, such that the applicant is in an especially advantageous and perhaps even unique position to illuminate some aspect or facet of the appeal which ought to be considered by the Court in reaching its decision but which, but for the applicant's intervention, might not receive any attention or prominence, given the quite different interests of the immediate parties to the appeal. (emphasis added) This statement of the law seems to have been generally accepted, particularly in the area of public interest litigation. It was recognized by Dubin, C.J.O., as he then was, in Peel v. A.P. (1990) 74 O.R. (2d) 164 (Ont. C.A.), at p. 167, that "there has been a relaxation of the rules heretofore governing the disposition of applications for leave to intervene" in constitutional cases. These cases reveal that in many instances, the courts have been liberal in permitting intervention to third parties with no direct interest in the subject matter of the proceeding, in the interests of having the fullest perspective on the constitutional issues presented to the court. On the other hand, the courts are less generous in permitting intervention in purely private proceedings (see for example, Klachefsy v. Brown, [1987] M.J. No. 565 (Man. C. A.), (Quicklaw)) The appellant submits that the results of legal proceedings often affect other parties, indeed, that is inevitable in the development of our common law. That does not, however, entitle all, who might in future be affected by the result, to intervene. Generally lawsuits are restricted to the adjudication of live disputes between the parties directly concerned. This is relevant to determining whether the applicant has the requisite "interest" in the proceeding. U.T.U., Locals 1778 v. B.C. Rail, supra, concerned an application to intervene in an appeal from a decision wherein the trial judge granted the relief sought by the petitioners United Transportation Union and the Pipefitters Union. The trial judge had concluded that the report of the Industrial Inquiry Commission dated September 24, 1990 including the ratification vote is of no legal effect upon the petitioning unions or their members employed by B.C. Rail. The Business Council of British Columbia sought leave to intervene in the appeal. Proudfoot, J. A., in granting the application, said at p. 6: The next consideration must be the nature of the interest of the applicant in the actual lis between the parties. An application to intervene will be allowed if there is a direct interest, see: Hirt v. College of Physicians and Surgeons of B.C. (1985), 60 B.C.L.R. 273. Intervener status may also be granted if there is no direct interest in the issues between the parties but the applicant has an interest in the "public law issues". The court will then consider the issues in that particular case and will consider whether the intervener will bring a new or different perspective to the consideration of the issues, or will make a useful contribution towards resolving the issues, always bearing in mind that the intervention will not be permitted if it would result in injustice to the parties. The applicant submits that the Council has a direct interest here because a continuing strike of B.C. Rail would cause serious damage and devastation to its members. In addition it submits that there are issues of public law raised in which it is interested and to which it will bring a different perspective. If this is a matter of "public law" it is because it involves a question of the integrity of the procedure available, that is the appointment of the Industrial Inquiry Commission, to resolve industrial relations disputes. More specifically in this case, a dispute which involves the interruption of service by a public carrier. It is argued that because the Council is interested in the resolution of disputes and the resumption of business as usual, whereas the parties are interested in the resolution of industrial relations disputes on their own terms, it will bring a different point of view to bear on the issues. The appellant is correct in that this is a case of tort and contract not a public law case. In resolving the issues, however, the trial judge did not limit his findings to the tendering process as it worked between the appellant and the respondent. He made wide ranging findings regarding the overall state of the government tendering process, which, if upheld on appeal, could have significant effect on the business of government tendering in Nova Scotia and thus upon the membership of CANS, among others. I accept the submission of counsel for CANS that this is somewhat distinct from a case involving a dispute between private litigants, wherein law may be developed which will have an impact upon others in future. The subject matter is broader than as defined by the appellant above. I am satisfied, that in the circumstances of this case, there is an analogy with 'public law' issues. The integrity of the government tendering process is of interest to the public generally, in that it involves the expenditure of public funds. I further find that CANS has the 'sufficient interest' in the subject matter of this appeal required by Civil Procedure Rule 8.01(1)(a). In my view, however, the finding of a sufficient interest in the subject matter does not automatically entitle an applicant to intervene. (b) Balancing the issues Once the intervenor has established a sufficient interest, before granting the intervention, the court may consider whether the applicant has something to add to the proceeding. The test is, as stated by Sopinka and Gelowitz, supra, at p. 185: The proposed intervenor must convince the court that it brings something additional to the appeal that the parties may not be able to supply. Often this "something additional" is a different or wider perspective on the issues before the court on appeal. In the context of Civil Procedure Rule 8, this is a relevant factor in the exercise of discretion involved in the granting of leave. C.P. Rule 8.03 provides that the court is to grant 'such order as it thinks just'. I am satisfied that it is appropriate to consider in this context, as well, what the intervenor will bring to the process. As Wakeling J.A. said in Attorney General of Canada v. Saskatchewan Water Corporation et al. [1991], 2 W.W.R. 614 (Sask. C. A.) at pp. 616: Before turning my attention to an assessment of the role that the intervenors have indicated they can play relative to the issues that have been formulated by the parties to this action, I wish to again affirm the position which this Court developed in Brand v. College of Physicians and Surgeons (Sask.) (1990), 72 D.L.R. (4th) 446 . . . in which the following comment appears (at p. 467): . . . it seems clear that having an interest in the result of this appeal would not of itself create a basis for granting the application to intervene. Rather, there must be some prospect that the process will be advanced or improved in some way by virtue of the intervention. In Dha v. Ozdoba (1991), 47 C.P.C. (2d) 23 (B.C.C.A.), [1991] B.C.J. 302 (Quicklaw) the Municipal Insurance Association of British Columbia (MIABC) and the Union of British Columbia Municipalities (UBCM) applied to intervene in an appeal from a judgment holding that a municipality was one‑third liable for damage to the respondent's house as a result of engineering and site problems, and holding that the municipality owed a duty of care to the respondents which was breached by the building inspector. MIABC was a reciprocal insurance exchange to which municipalities subscribed and UBCM provided a voice for local governments. The applicants submitted that the appeal was to determine issues which were to impact on the legal liability of these municipalities. MacFarlane, J. A. wrote at p. 4: The applicants submit that the present appeal will determine issues which will impact on the legal liability of all municipalities and regional districts who are subscribers with the MIABC and members of the UBCM. They also submit that the issues raised on appeal go beyond a simple fact situation involving defective house foundations and go to the root of the relationship between owner/builders and all levels of local authorities. . . . The applicants in this case may be affected by the outcome of the appeal in the sense that it will stand as a precedent which may affect the potential liability of all municipalities in the province. But, that is not enough to justify intervention: Re Schofield v. Minister of Consumer and Commercial Relations (1980) 112 D.L.R. (3d) 132. After considering the issues of concern to the intended intervenor and reviewing the facta on file he writes, at p. 13: I am not persuaded that the interveners can make any useful contribution to the resolution of the issues before the Court in this appeal. I am satisfied that the appellant is prepared to and will make submissions on all relevant issues. I do not think that the interveners can bring any different perspective to the appeal than that which the appellant will bring. The appeal involves a private law issue rather than a public law issue. It does not sound in social or constitutional issues, involving the Charter or otherwise. Thus, it is not of the type in which intervention is often allowed. All that would be accomplished by allowing intervention in this case would be to add another lawyer's argument, another factum, and more cost to the litigants. The plaintiffs cannot afford the burden of such costs. In R. v. Latimer (1995), 128 Sask. R. 195 (Sask. C. A., chambers), [1995] S.J. No. 101 (Quicklaw), Mr. Latimer appealed his conviction for second degree murder in relation to the death of his physically handicapped daughter. Sherstobitoff, J. A. considered an application by two interest groups, each representing persons with disabilities, to intervene. He summarized the submission of the intended intervenors at paragraph 8 of the decision, as reported on Quicklaw: Since the Crown is opposing both appeals, it must, of necessity, address and oppose each of the grounds of appeal. There is no reason to suppose that it cannot adequately do so, and that in doing so, it will not adequately represent the interests of the public, including the interests of the disabled. The applicants do not dispute this, but say that they can give a supplementary point of view different from that of the Crown, a point of view which none but disabled persons can provide. They will cite authority from other areas of the law such as human rights law, which they say is relevant but has not been referred to by the Crown in its written material. They emphasize that they do not intend to repeat what the Crown says, but to supplement it. They say that this meets one of the requirements for intervenor status set out by Wakeling J.A. of this Court in Brand v. College of Physicians and Surgeons (1990), 72 D.L.R. (4th) 446. (emphasis added) CANS, if permitted to intervene, will be limited to the record established in the trial court. CANS submits, however, that the respondent, as a single supplier of product, is not in a position to address the perspective of the broader industry. CANS submits that it has a particular expertise in matters of tendering and wishes to ensure that all of the issues raised in this appeal, as evidenced by the grounds of appeal are adequately and fully addressed. I am mindful that CANS does not speak for the entire construction industry, nor is its perspective of the tendering process the only perspective. I am concerned, as well, that leave to intervene not be broadened to the point of permitting unlimited intervention in proceedings. I am satisfied that this concern can be properly addressed through the exercise of the courts discretion on a case by case basis. Disposition: I am, marginally persuaded that CANS should be afforded a limited opportunity to intervene in this appeal. In particular, that it can add a broader perspective to the issues before the court. There are, however, certain practical restraints to its intervention. The appeal has already been set for hearing. The hearing is just a month away. Time for the hearing was allowed on the basis of a two party appeal. CANS has made this application very late. It is not appropriate that the appeal be postponed, nor that CANS be permitted to encroach on the time permitted the parties for oral argument. CANS had asked, as well, that it be exempted from any liability to pay costs. I can see no reason for such a limitation. If CANS wishes to participate, it should be exposed to the risks as would any litigant. On the other hand, CANS, coming to this proceeding as it does, should not be entitled to costs, in the event the respondent is successful. The appellant should be required to answer for costs to only one party, if at all. This remains the appeal of the appellant and the respondent. Accordingly, I order that CANS be permitted to intervene on this appeal on the following terms: 1. CANS shall be permitted to file a written factum, restricted to the issues raised in grounds 4, 5, 6, 7, 8, 11, 12, 13, 14, 17, 18, and 19, only, of the Notice of Appeal dated December 5, 1995. 2. CANS will not be permitted to address oral argument to the court, unless called upon to do so, but shall have counsel present to answer any questions the Court may have arising from their material. 3. CANS shall file its factum on the same day as the factum of the respondent, being, March 12, 1996. The appellant shall be permitted to file a Reply, if it chooses to do so, but not later than March 22, 1996. 4. CANS shall be liable to respond to an order for costs, in the discretion of the Court, but shall not be entitled to receive costs on the appeal. There shall be no costs of this application. Bateman, J. A. C.A. No. 122976 NOVA SCOTIA COURT OF APPEAL BETWEEN: ATTORNEY GENERAL OF NOVA SCOTIA ) Appellant ) - and - ) ) BEFORE THE ARROW CONSTRUCTION PRODUCTS ) HONOURABLE LIMITED ) JUSTICE BATEMAN ) (in Chambers) Respondent ) ) - and - ) ) CONSTRUCTION ASSOCIATION OF ) NOVA SCOTIA ) ) Intervenor ) ) )