Elsser v. University of Victoria

2022 BCSC 580 Elsser v. University of Victoria

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Elsser v. University of Victoria, 2022 BCSC 580 Date: 20220411 Docket: S201579 Registry: Victoria Between: Aaron Timothy Elsser Plaintiff And University of Victoria Defendant Before: The Honourable Madam Justice Murray Reasons for Judgment re Summary Judgment Application to Dismiss the Action Counsel for the Plaintiff: M.D. Selly K. Bergsson Counsel for the Defendant: R.L. Hayley M. Vesely Place and Date of Hearing: Victoria, B.C. January 19-21, 2022 Place and Date of Judgment: Victoria, B.C. April 11, 2022 Introduction [1] The plaintiff, Mr. Elsser, seeks to represent a class of individuals who purchased annual parking permits prior to March 13, 2020, which were effective between March 16 and August 31, 2020, from the defendant, the University of Victoria (the "University"). When the campus essentially closed in March 2020 due to the COVID-19 pandemic, the University took the position that it would not issue partial refunds to annual parking permit holders. The plaintiff alleges that because the University went from in-person to remote learning due to the pandemic, there was no reason for him (or other prospective class members) to park on campus. Consequently, the plaintiff argues that the parking contract was frustrated and/or breached and parking permit holders should have been reimbursed on a prorated basis [2] In this

summary judgment application, the University seeks an order dismissing the plaintiff's action in its entirety on two bases: 1. the plaintiff's pleadings do not raise a triable issue; or 2. alternatively, the action is statute-barred by the express language of three statutes: the University Act, R.S.B.C. 1996, c. 468, the Public Health Act, S.B.C. 2008, c. 28, and the Emergency Program Act, R.S.B.C. 1996, c.

111. Background [3] On September 24, 2019, the plaintiff, then an undergraduate student at the University, purchased an annual parking permit for $568.05 which allowed him to park on the University campus from September 1, 2019 to August 31, 2020. He attests that he purchased the parking permit "for the purpose of attending the University campus to learn and study". [4] As a result of the world-wide pandemic and resultant public health orders, on or about March 16, 2020, the University moved to online learning. The plaintiff takes no issue with the University's decision to do so, conceding that it was the prudent thing to do. [5] Although the University submits that it never completely shut down, in late March, 2020 the buildings, including the gym which the plaintiff frequented, were for all intents and purposes closed to students. Again, the plaintiff takes no issue with these decisions of the University. [6] As a result of the closures and the move to remote learning, the plaintiff attests that he did not attend the campus between March 23 and August 31, 2020. [7] On or about March 20, 2020, the University announced on its website that it would not be issuing partial refunds to annual parking permit holders like the plaintiff. It did however provide ex-gratia refunds to people who had purchased parking permits of less than 12 months. In establishing its refund policy, the

University separated the parking permits into two groups: annual, and under 12 months. While there was no provision regarding refunds for the latter category of permits, the annual permit is subject to s. 48.00 of the University's Traffic and Parking Regulations (the "Regulations") which allows for pro-rated refunds within the first four months of the permit; with no reason for refund required. As per the Regulations, after the fourth month there are no refunds for any reason. The University relied on this regulation as the rationale for refusing refunds to annual parking permit holders. [8] In his action, the plaintiff advances two alternative claims: 1. that the parking contract was frustrated by the pandemic; and/or 2. that the University breached the annual parking contract. [9] Although in his amended notice of civil claim (ANOCC) the plaintiff plead a third claim of unjust enrichment, he abandoned that claim at this hearing. Legal Framework [10] Rule 9-6, the summary judgment rule, is employed to prevent claims or defences that have no chance of success from proceeding to trial. The relevant part reads as follows: (4) In an action, an answering party may, after serving a responding pleading on a claiming party, apply under this rule for judgment dismissing all or part of a claim in the claiming party's originating pleading. (5) On hearing an application under subrule (2)

or (4), the court, (a) if satisfied that there is no genuine issue for trial with respect to a claim or defence, must pronounce judgment or dismiss the claim accordingly, . and (d) may make any other order it considers will further the object of these Supreme Court Civil Rules. [11] Rule 9-6 does not provide for a summary trial, rather it is a challenge to an action on a limited review of the evidence, generally introduced by way of affidavit. The court must not weigh the evidence beyond determining whether it is incontrovertible. For the defendant to succeed on a Rule 9-6 application, the court must be satisfied that the plaintiff's claim has no chance of success. Put another way, the court must be satisfied beyond a reasonable doubt that there is no genuine issue for trial. See Beach Estate v. Beach, 2019 BCCA 277 at paras. 47-49 and 65-66. Issues [12] In order to decide whether the plaintiff's action should be dismissed summarily, the court must consider the following issues: 1. Has the University proved beyond a reasonable doubt that the plaintiff's claim that the parking contract was frustrated has no chance of success?

2. Has the University proved beyond a reasonable doubt that the plaintiff's claim that the parking contract was breached has no chance of success?

3. If the University has failed to prove (1) and (2) above, is the plaintiff's action barred by statute? [13] I will consider each issue in turn. As a preliminary matter I must first address the plaintiff's argument that the University's application is premature because the University has not provided material disclosure. Is the University's application premature given the lack of disclosure? [14] The plaintiff argues that the University's application is premature because it has not provided the following disclosure: a. documents regarding the University's decision to retain the fees from parking permits that covered the March 16 to August 31, 2020 period; b. documents regarding refunds or partial refunds that the University did provide for parking permits that covered the March 16 to August 31, 2020 period; c. documents regarding budgets for green initiatives and changes resulting from the Pandemic; d. documents related to budgetary issues generally with respect supportive funding received from the province to meet the immediate needs of students; e. documents regarding cost of campus parking security changes during the Pandemic; and f. documents regarding parking permit purchase patterns and the value of permits. [15] The plaintiff urges me to find both that the requested disclosure relates to the University's decision or decision-making process to deny refunds to annual

permit holders, and that such disclosure is essential to his ability to answer this application. I am unable to make either such finding. [16] The fact that the discovery process is not complete is not enough to resist summary judgment. In order to be successful on a claim that the summary judgment application is premature, the respondent must demonstrate that there is a reasonable prospect that further discovery will reveal the existence of a triable issue. In that instance, a final order of summary judgment is not available as there is still a reasonable doubt about whether a triable issue may emerge: Xiao v. Fan, 2020 BCSC 69 at paras. 48-49. [17] In this case, I am not satisfied that the requested disclosure will reveal the existence of a triable issue. The plaintiff's claims are straightforward and are based on the University's refusal to issue a refund to annual parking permit holders. That the University refused is not in issue. In fact, Gayle Gorrill, the former Chief Financial Officer and Vice-President of Finance and Operations for the University, who made the decision regarding refunds, provided a detailed account of how the decision was made. [18] The plaintiff's request for disclosure relating to the University's decision to refuse refunds could only go to an allegation of bad faith, or serve some collateral purpose as part of a litigation strategy to exert

pressure on the University. There is no adequate foundation in the pleadings for a claim of bad faith; just a bald assertion. As stated by our Court of Appeal in Walkom v. Law Society of British Columbia, 2019 BCCA 319 at para.35, the pleadings define the issues and drive the discovery process. A disclosure request not based in the pleadings cannot preclude a summary judgment application. [19] I make this finding having regard to the nature of the plaintiff's claim: the plaintiff's arguments for frustration and contractual breach relate to notoriously known facts and those already before me on this application, specifically the terms of the contract, and the University's actions in response to the COVID-19 pandemic. How or why the University made their decision to refuse the refunds is not determinative of whether the contract was breached or frustrated. The University's "decision-making process," the amount of parking permit money refunded, what the University did with the money it did not refund, or cost savings to the University during the pandemic do not need to be investigated in order for the plaintiff to put his best foot forward on this application or for the court to determine whether the breach of contract or frustration claims should be dismissed. Nor will any of that disclosure raise a triable issue. [20] I am not satisfied that the application to dismiss is

premature. [21] I now turn to address the questions above. Issue 1: Has the University proved beyond a reasonable doubt that the plaintiff's claim that the parking contract was frustrated has no chance of success? [22] The plaintiff set out the basis for the claim of frustration in his ANOCC as follows: 3. The Pandemic constitutes a frustrating event that so significantly changed the nature of the University and the Class Members' rights and obligations from what they could have reasonably contemplated when executing the Permit Contracts, that it would be unjust to hold them to the Permit Contracts' literal stipulations. .

6. The Campus Closure constituted a default in a substantial term of the Permit Contracts, namely the Parking Requirement Term, which is more than a mere delay or interruption. [23] In brief, the plaintiff, who states that he contracted to park at the University to attend classes, argues that when classes went remote due to the pandemic, the parking permit became worthless as there was no reason for him to park on campus, and that the central purpose or basis of the contract no longer existed. [24] The Parking Requirement Term is central to the plaintiff's claim of frustration. He defines it in his ANOCC as follows: 13. It was an implied term of the Permit Contracts that the University covenanted to keep the buildings on the Campus open and continue providing in-person classes and services as indicated in the University of Victoria calendar 2019-2020, so that the parking stalls on the Campus would be reasonably required for the purpose of storing the Class Members' vehicles while the Class members attended the Campus (the "Parking Requirement Term"). [25] The University responds that the parking contracts were for parking and were intended only to provide the plaintiff and other permit holders with the authority to park on campus. Under the parking contract the University did not contract with the plaintiff or anyone else to provide parking permit holders with in person

academic instruction or provide any other University service. The contract was for parking and that is what the plaintiff got. The fact that classes went from in-person to online did not change the subject matter of the contract. The plaintiff could still park on campus at all times. [26] Finally, the University points out that the annual parking permit is a discounted rate and has a clear refund provision, as set out in the Regulations, which clearly allocates the risk of the parking permit holder no longer wishing to park: for the first fourth months the risk was squarely on the University; and following that on the purchaser of a parking permit (the "Refund Provision"). The University says the Refund Provision demonstrates that the risk of a purchaser of parking permit holder no long having desire to park was not unforeseen, did not destroy the subject matter of the contract, and, to the contrary was actually provided for in the contract. Further, there was consideration for this allocation of risk: purchasers of annual permits with the Refund Provision outlined above received a discount as compared to purchasers of short-term parking permits. [27] In Foley v. Trelinski, 1997 CanLII 469 (BCSC), Sigurdson, J. summarized the test for frustration: [18] In order to find that the contract at issue has been frustrated the following criteria would have to be satisfied. The event in

question must have occurred after the formation of the contract and cannot be self-induced. The contract must, as a result, be totally different from what the parties had intended. This difference must take into account the distinction between complete fruitlessness and mere inconvenience. The disruption must be permanent, not temporary or transient. The change must totally affect the nature, meaning, purpose, effect and consequences of the contract so far as concerns either or both parties. Finally, the act or event that brought about such radical change must not have been foreseeable. [Emphasis added.] [28] There are two elements to the test: 1. A qualifying supervening event for which the contract makes no provision, is unforeseen and is not the fault of either party, which 2. Causes a radical change in the nature of a fundamental contractual obligation. See Wilkie v. Jiang, 2017 BCSC 2131 at para. 18. [29] Applying the test to the facts in the present case, there is no doubt that the world-wide pandemic which caused a radical shift in the way university classes were conducted is an event that was not the fault of either party and could not have been foreseen. However, as the University correctly points out, while the specific risk of a pandemic may not have been stipulated in the contract or within the contemplation of the parties, the more general risk of the parking

permit holder no longer being desirous of a parking spot, for any reason, was provided for in the contract, and was not unforeseen. I accept that the Refund Provision set out in the Regulations was an express term of the contract. [30] Further, the change to online learning did not render the parking contract totally different from what the parties had intended and thus fruitless, or cause a radical change in a fundamental contractual obligation. [31] The purpose of the contract is simple: the plaintiff paid money in exchange for the ability to park on campus. There was no term that the plaintiff needed to be attending classes, using University services or even be enrolled as a student at the University in order to enter into a parking contract or that he could only park on campus when attending class or doing something at the University. The plaintiff argues that it is common sense to conclude that only people that were attending the University or working there would buy an annual parking permit. That may be so, but it was not a term, either express or implied, of the contract. The plaintiff did not need a reason to park on campus to purchase a permit. Parking permits are not only available to people that work or attend classes on campus. The parking contract is quite simply that- a contract for a parking spot. The pandemic did not change the fundamental contractual

obligations. The plaintiff could still park at the University after learning went online and the gym closed. [32] While I accept that the switch to online learning and the campus closure rendered the parking contract less useful, I am unable to conclude that it rendered it fruitless. Further, the risk of the purchaser no longer desiring or requiring a parking permit was clearly allocated in the contract. Had the pandemic affected the University's operations within the first four months of the contract, the plaintiff would be entitled to a refund. While, unfortunately for the plaintiff, the pandemic occurred during the latter half of the contract, the plaintiff assumed this risk when he purchased the permit, and, actually received compensation for assuming such risk in the form of a discounted permit. [33] This situation is different than in Krell v. Henry, [1903] 2 K.B. 740, a case the plaintiff relies on. Briefly put, the facts in Krell are as follows: on June 20, 1902, the defendant entered into a written contract with the plaintiff to rent a flat in London for June 26 and 27 from which to watch Edward VII's coronation as king. There was no reference in the contract to the coronation. The defendant paid a deposit upon entering into the contract. Edward VII fell ill and the processions were postponed. The contract was silent as to refunds or what would happen if the

processions did not occur. As the coronation did not take place, the defendant refused to pay the balance owing. The plaintiff sued. The trial judge held that there was an implied condition in the contract that the procession should take place and found in favour of the defendant. The plaintiff appealed. [34] The Court of Appeal upheld the decision of the trial judge, finding that the processions were regarded by both parties as the foundation of the contract. In coming to this conclusion, the court took into consideration all of the surrounding circumstances in order to determine the substance of the contract including that the flat had been advertised for rent as a good place from which to view the coronation processions; that before entering into the contract the defendant interviewed the housekeeper about the view and the processions; and that flat was only rented for the days of the processions. [35] In the present case, there are no surrounding circumstances that the parking contract was entered for the particular purpose of attending in-person classes or the gym. Again, any person, including persons who do not work or attend the University can enter into a contract to park on campus. Further, and of significance, unlike the circumstances in Krell, the parking contract has a clear provision for refunds which allocate risk squarely upon the plaintiff. [36] During his

submissions, counsel for the plaintiff suggested that frustration had to be considered in light of an implied term of the contract that the University would remain open. I have found that such an implied term can not exist because it would be contrary to the express terms of the Refund Provision, for reasons I outline below in my consideration of the breach of contract argument. However, I note that even if the "Parking Term Requirement" was not contrary to the express terms of the contract, the surrounding circumstances in this case do not support an inference that the foundation of the parking contract was to attend in-person classes or the gym. [37] The case of Claude Neon General Advertising Ltd. v. Sing, [1941] N.S.J. No. 9, is instructive. In June 1939, the parties entered into a written agreement whereby the plaintiff agreed to build a neon sign for the defendant and then lease it to him. The defendant was to pay a monthly rental fee to the plaintiff for 60 months. The contract was silent as to what was to happen in the event of contingencies. On September 10, 1939, Canada entered World War II. The use of lighted outdoor electrical signs was prohibited between sunset and sunrise. The plaintiff sued the defendants for unpaid rent for the sign. The defendant asserted that the contract was frustrated on the basis of the wartime restrictions which were unforeseen and

extraordinary. The court rejected the defendant's argument finding as follows: No part of the contract between the parties became impossible. The defendant certainly gets very much less benefit from the sign, but it is not entirely useless as a daylight sign. The lighting of it, even when legal, is a matter for the defendant. [Emphasis added.] [38] Claude Neon is close factually to the present case. While the plaintiff got much less benefit than he would like from his parking permit, he could still use it. Put another way, the subject matter of the contract was not destroyed. [39] I am satisfied beyond a reasonable doubt that the plaintiff's claim that the parking contract was frustrated raises no triable issue and accordingly has no chance of success. The plaintiff's frustration claim is dismissed. Issue 2: Has the University proved beyond a reasonable doubt that the plaintiff's claim that the parking contract was breached has no chance of success? [40] In his ANOCC the plaintiff frames his claim for breach of contract as follows: 7. In the alternative, if the Permit Contracts were not frustrated, the Parking Requirement Term is an implied term of the Permit Contracts and the University breached that term by effecting the Campus Closure.

8. In the further alternative, if the parking Contracts were not frustrated, the Good Faith Term was an implied term of the permit Contracts and the University breached that term by refusing to provide partial refunds for the Class members' parking permits. [41] As it was with his claim of frustration, the Parking Requirement Term is central to the plaintiff's claim of frustration. [42] The "Good Faith Term" is defined in the ANOCC as that the University would exercise its duties under the permit contract in good faith. The plaintiff submits that in refusing to provide refunds to annual parking permit holders, the University acted arbitrarily and "not in good faith". [43] The success of this cause of action depends on whether the Parking Requirement Term and the Good Faith Term can be implied into the parking contract. [44] The University argues that they cannot. With respect to the Parking Requirement Term, the University says that it cannot be implied into the parking contract for a number of reasons. First, it is contrary to the University calendar, which provides: The University of Victoria accepts no responsibility for the interruption or continuance of any class or course of instruction as a result of an act of God, fire, riot, strike or any cause beyond the control of the University of Victoria. [45] Second the Parking Requirement Term cannot be implied into the parking

contract as it does not fit into any of the circumstances where a term may be implied, 1) based on custom or usage; 2) as the legal incidents of a particular class or kind of contract; or 3) based on the presumed intention of the parties where the implied term must be necessary "to give business efficacy to a contract or as otherwise meeting the 'officious bystander' test as a term which the parties would say, if questioned, that they had obviously assumed". See M.J.B. Enterprises Ltd. v. Defence Construction (1951) Ltd., [1999] 1 S.C.R. 619 at para. 27. [46] The plaintiff relies on categories 1) and 3). [47] Regarding the first category, custom or usage has been held to mean that "it is so notorious and so generally acquiesced in that it may be presumed to form an ingredient of the contract", or alternatively "so all pervading and so reasonable and so well known that everybody must be assumed to know it and contract subject to it": Georgia Construction Co. v. Pacific Great Eastern Railway Co., [1929] S.C.R. 630 at 633-4. [48] The plaintiff argues that the only people that buy parking permits are people with business on the campus, therefore there is a customary use. I disagree. As I have already stated, while I agree with the plaintiff that the majority of the permit holders are likely students or employees of the University, anyone can buy a parking permit for any purpose.

The Parking Requirement Term cannot be taken as fitting under the definitions above. Further, as Loo, J. stated in CanPacific Engineering Inc. v. Alican Enterprise Inc., 2011 BCSC 269 at para. 130, "The court's power to imply terms in a contract must be used cautiously and must not be used to rewrite the contract or contradict the express wording of the contract". To imply the Parking Requirement term would be to rewrite the contract. [49] Respecting the third category, necessary to business efficacy, our Court of Appeal held in Moulton Contracting Ltd. v. British Columbia, 2015 BCCA 89, that "the key element is that the implied term is more than just reasonable; it is necessary to make the contract as the parties intended" (para. 55). The term must have a degree of obviousness. If there is evidence of a contrary intention by either party, a term cannot be implied: Moulton at para. 54. [50] The Parking Requirement Term does not fit into this category. The parking contract is straightforward: the University provides parking in exchange for payment. The plaintiff argues that Parking Requirement Term should be implied "particularly as it relates to his personal circumstances". That is an untenable argument. The terms of the parking contract, and in this case, the parking regulations, cannot vary from person to person. [51] Finally, the proposed, unwritten Parking Requirement Term

would be contrary to expressed term of the contract concerning allocation of risk, which does not permit refunds for any reason after four months. If the University had covenanted to keep buildings open and classes in person, as the plaintiff proposes, then as a matter of logic the Refund Provision would need to be re-written to provide for refunds if the University broke this covenant. This is clearly the outcome desired by the plaintiff, but is contrary to the actual, recorded terms of the contract, which does not contemplate refunds after four months in the event of the University's closure. [52] I find that the Parking Requirement Term cannot be implied into the parking contract. It does not fit under any of the categories and it would be contrary to the University calendar and the express, recorded terms of the contract. [53] I will now turn to consider whether the Good Faith Term can be implied in the contract. Similar to my findings above concerning the Parking Term Requirement, the University takes the position that the Good Faith Term would be contrary to the express term which governs when refunds will be available and when they are not. The University says a finding that the Good Faith Term was implied would require the court to re-write the Refund Provision. In support of this argument, the University relies on a recent decision of the Ontario Superior Court of

Justice, Carter v. Ford Motor Company of Canada, 2021 ONCA 4138 at para. 133 where Perrell, J. stated the following: The putative Class Members of Group "2" who, in theory, might qualify to rely on an implied warranty are confronted with an insurmountable obstacle. It is plain and obvious that these putative Class Members cannot imply a term inconsistent with the express terms of the underlying contract. A term will not be implied, if the term would be inconsistent with the existing wording of the contract; an implied term must fit with the existing contract. The implied warranties asserted in the immediate case for the Group "2" claimants do not fit with the provisions of the New Vehicle Limited Warranty. [Emphasis added.] [54] The plaintiff counters that the Good Faith term is not contrary to the Refund Provision in the parking regulations because the regulations are silent as to refunds in the case of a frustrating event. This argument appears to depend upon the plaintiff successfully establishing the frustration of the contract. As I have already found that the move to online learning does not constitute a frustrating event, I do not need to address this argument in detail, but will make a few observations about the good-faith contractual performance. [55] In Bhasin v Hyrnew, 2014 SCC 71, the Supreme Court of Canada described good faith as an "organizing principle" of

contract law, stating, at para. 65 that "in carrying out his or her own performance of the contract, a contracting party should have appropriate regard to the legitimate contractual interest of the contracting partner." [56] In this case I have found that the plaintiff was not entitled to a refund under the terms of the contract. There was a clear contractual provision regarding refunds: for the first four months pro-rated refunds were available for any reason, and following four months, no refunds were available for any reason. It can not be bad-faith conduct for University to adhere to the express terms of the contract. The plaintiff had no contractual interest in a refund. This was not a case of the exercise of discretion. There was no contractual interest to which the University should have "appropriate regard." To the contrary, the plaintiff must have regard for the University's legitimate interest in upholding the terms of the contract which the parties entered into. This contract is clear. [57] I do not need to determine whether the requirement of good faith was an implied term of the contract. The plaintiff's argument that the University acted in bad faith by refusing issue refunds is bound to fail because the University was simply adhering to the express terms of the Refund Provision. [58] Given my findings regarding the Parking Requirement Term and the Good Faith

Term, I am satisfied that the plaintiff's claim that the parking contract was breached has no chance of success. Accordingly, the breach of contract action is dismissed. [59] Having dismissed both of the plaintiff's claims, I need not consider whether the actions are statute-barred. Conclusion [60] The plaintiff's action is dismissed pursuant to Rule 9-6. [61] Costs to the University. "The Honourable Madam Justice Murray"