Moses v. Lower Nicola Indian Band

2015 BCCA 61 Moses v. Lower Nicola Indian Band

COURT OF APPEAL FOR BRITISH COLUMBIA Citation: Moses v. Lower Nicola Indian Band, 2015 BCCA 61 Date: 20150217 Docket: CA041811 Between: Donald Cyril Moses Appellant (Plaintiff) And Lower Nicola Indian Band Respondent (Defendant) Before: The Honourable Madam Justice Newbury The Honourable Madam Justice D. Smith The Honourable Madam Justice Stromberg-Stein On appeal from: An order of the Supreme Court of British Columbia, dated April 15, 2014 (Moses v. Lower Nicola Indian Band, 2014 BCSC 643, Kamloops Docket No. 48738). Counsel for the Appellant: J. McArthur T. Posyniak Counsel for the Respondent: P. Anderson Place and Date of Hearing: Vancouver, British Columbia January 15, 2015 Place and Date of Judgment: Vancouver, British Columbia February 17, 2015 Written Reasons by: The Honourable Madam Justice Newbury Concurred in by: The Honourable Madam Justice D. Smith The Honourable Madam Justice Stromberg-Stein Summary: In 2010, some members of the Lower Nicola Indian Band ("LNIB") Council purported to pass a resolution suspending the plaintiff Mr. Moses as chief. He successfully obtained a consent order in Federal Court setting aside the resolution as invalid and unlawful. The consent order stated there was "no order as to costs". Mr. Moses then sued LNIB in B.C. Supreme Court for legal fees he had paid in relation to the Federal Court proceeding. He claimed misfeasance in public

office and unjust enrichment. LNIB successfully applied to have the claims struck. On appeal, plaintiff submits Chambers Judge erred in applying a two-year limitation period to the misfeasance claim and in concluding it was plain and obvious the unjust enrichment claim would fail. Held: appeal allowed in part. The misfeasance claim was not a claim for "injury to person or property" within the meaning of s. 3(2)(a) of the Limitation Act. It was therefore subject to a six-year limitation period and not statute-barred. The misfeasance claim was also not bound to fail, as it was unclear at this stage whether the consent order made the claim res judicata or gave rise to issue estoppel. On the unjust enrichment claim, however, no potential amendment to the pleadings could render the legal fees paid by the plaintiff an "incontrovertible benefit" to LNIB, as whether Mr. Moses' actions provided any benefit is not a question a court can answer. Thus, chambers judge did not err in striking the unjust enrichment claim. Plaintiff was given 30 days in which to amend his pleadings to assert misfeasance claim properly, failing which LNIB could re-apply under R. 9-5. Reasons for Judgment of the Honourable Madam Justice Newbury: [1] This appeal raises procedural and legal questions that are the result of serious deficiencies both in the pleadings and in the underlying premises of the plaintiff's

two causes of action - misfeasance in public office and unjust enrichment. At the end of the day, the question for us is whether these deficiencies are fatal to one or both claims. Factual Background [2] At the material time, the plaintiff Mr. Moses was the elected chief of the defendant Lower Nicola Indian Band ("LNIB" or the "Band"). Evidently, the Band consists of some 1,100 members. It has been plagued with deep political divisions that have resulted in almost continuous litigation, primarily in the Federal Court of Canada. (See 2012 FC 103 at paras. 5-32.) The Band is managed by a council comprised of the chief and seven councillors who are bound by formal oaths of office and the LNIB's bylaws and policies. [3] On January 24, 2010 the Council, or certain members thereof, purported to pass a resolution suspending Mr. Moses' authority as chief on the following terms: WHEREAS the Lower Nicola Indian Band Chief and Council has received a petition requesting the impeachment of Chief Don Moses for substantial violation of Lower Nicola Indian Band Policies and Bylaws; WHEREAS the Lower Nicola Indian Band Council has agreed to investigate Chief Don Moses for potential breaches of his Oath of Office, policies and laws; BE IT RESOLVED THAT the Council Table of the Lower Nicola Indian band, pursuant to section 25(a) of the Lower Nicola Indian Band Policy and Guidelines for Chief and

Council suspend Chief Donald Moses from all Chief and Council activities without honoraria for one month commencing January 24, 2010. It is not clear whether the resolution was passed at a duly constituted meeting of the Council (i.e., a meeting of which proper notice had been given and at which a quorum was present). There is no indication that Mr. Moses was present at any meeting, valid or otherwise, at which the resolution was discussed. [4] At the end of the term of the 30-day period of suspension, on February 23, 2010, a second resolution purported to remove the plaintiff as chief "pursuant to section 25 of the Lower Nicola Indian Band Policy and Guidelines for Chief and Council from all his duties, appointments, political representation without honorarium for the duration of the forensic audit investigation and given [sic] notice of natural justice by correspondence." The recitals to the resolution alleged breach of fiduciary duty on the part of Mr. Moses, a conflict of interest in connection with an industrial waterline project, and failures to comply with various bylaws of the Band. [5] Again, it is not clear whether the resolution was passed at a duly constituted meeting of the Council or was simply signed in writing by the five members who were in favour of the Chief's removal. The plaintiff alleges in his Notice of Civil Claim that he and two other councillors were

not given notice and did not attend and that no evidence was adduced at the meeting in support of his removal. He was served with notice of this purported resolution on February 25, 2010. [6] In the interim between the two resolutions, the plaintiff initiated an application for judicial review in the Federal Court of Canada, seeking to quash the first resolution. On becoming aware of the second resolution, he amended his pleadings to include a prayer for judicial review of that resolution. (The first resolution fell away on the expiration of the 30-day period.) The Federal Court action (Docket T-209-10) named Chief Moses and the "Lower Nicola Indian Band Council as represented by Councillor Connie Joe and Councillor Harold Joe" as applicants; and "the Council Table", as represented by the remaining five councillors who had signed the resolution, Mr. Sam, Ms. Basil, Ms. Toodlican, Ms. Seward and Ms. Lafferty, as respondents. The pleadings in the action were not provided to us. Both "sides" were represented by counsel. [7] On June 4, 2010, Mr. Justice Campbell of the Federal Court issued a consent order: (a) Declaring the February 23, 2010, BCR passed by the Respondents suspending Chief Moses for the duration of an audit of the Band's finances to be invalid and unlawful; (b) Quashing the February 23, 2010, BCR passed by the Respondents suspending Chief Moses for the duration of

an audit of the Band's finances; (c) [Granting] a permanent injunction on the following terms: (i) Prohibiting the Respondents from acting upon the [resolution] of January 24, 2010 and February 23, 2010; (ii) Prohibiting all parties from otherwise suspending or removing Chief Moses or any Councillor from office for the balance of his or her term without leave of the Court; (iii) [Prohibiting all parties from] Making decisions in secret for the balance of Council's term of office; and (iv) Setting aside the January 19, 2010, [resolution] impeaching the Respondents Aaron Sam and Yvonne Basil; (d) The court is to retain jurisdiction to supervise performance of these orders; (e) Mr. Justice Campbell shall remain seized of this proceeding and any other matters relating to governance of the Lower Nicola Indian Band pending the next election; (f) There is no order as to costs. [Emphasis added.] The plaintiff deposes that he regards para. (f) above as a "statement open to interpretation that did not in any way preclude one of the Parties from seeking reimbursement from Parties on the same side but [which] may have precluded either Party to the Application from seeking costs against each other." I shall return to that matter in due course. [8] On August 20, 2010, Mr. Moses wrote to the Band seeking payment by "LNIB Council forthwith" of the sum of $99,498.45, the amount he had paid to

his lawyer for representing him in the Federal Court action. The letter stated in part: To defend my political position as Chief and protect my office from the illegal activities of the quorum of Council mentioned above, I hired lawyer David E. Gruber and paid him from my own funds the amount of $99,498.45. I am presenting this for payment by LNIB Council forthwith for without the illegal activities of the above named Councilors of LNIB who sought to remove me illegally from my position as Chief to which I was duly elected by the membership, I would not have incurred this expense. [Emphasis added.] [9] This letter and follow-up letters seem to have elicited no response from the Band. According to an affidavit of Mr. Moses, the LNIB was "completely dysfunctional" between June 2010 and July 2012, including the first months of the term of office of a new chief, Mr. York. This "dysfunction" was reflected in further proceedings in the Federal Court which I need not describe. [10] On January 14, 2013, Mr. Moses wrote again to the Band, specifically seeking reimbursement under its Conflict of Interest Policy. It provides in part: 4. The Band may indemnify a Councillor against all costs and expenses, including an amount to settle an action or satisfy a judgement, if that Councillor: a) acted with due diligence; or b) followed the proper procedures as set out above (reported his/her

interest and did not vote on the decision); or c) relied and acted in good faith on statements of fact represented to him or her by a Band employee to be correct, or on statements contained in a written report of the Band's auditors; or d) had reasonable grounds to believe that his or her conduct was lawful. [11] The Band replied, shortly thereafter, denying the request. Its letter referred to para. (f) of the of the Federal Court's order and continued: Mr. Justice Campbell's Order determined that the Respondents are not liable to pay any of your costs of bringing your judicial review application nor are you liable to pay any of the Respondents any of their costs of defending your application. Council also notes that you consented to this when your lawyer signed page 3 of the June 4, 2010 Order; Finally, we note that you have threatened litigation against "LNIB and the Councillors named individually" if the Lower Nicola Indian Band does not offer to pay all of your legal expenses of your application for judicial review, plus interest. But, as the Lower Nicola Indian Band has no obligation to pay you what you are demanding and as the Court has already decided (in the Order you consented to) that no one is liable to reimburse you for your costs of bringing your application for judicial review, your threatened litigation must be doomed to fail. [12] Finally, on May 2, 2013, Mr.

Moses commenced this action in the Supreme Court of British Columbia by filing a Notice of Civil Claim seeking: A Declaratory Order that the Defendant, Lower Nicola Indian Band, is liable to reimburse the Plaintiff the sum of $99,000.00 for the legal expenses incurred by the plaintiff in the discharge of his duties as Chief of the Lower Nicola Indian Band. As the chambers judge below noted, however, the plaintiff's pleadings - which he appears to have prepared himself - were "not drafted with precision or clarity". On the basis of oral and subsequent written submissions made to her, the judge characterized the claim as one for "damages based upon the tort of misfeasance in public office and/or unjust enrichment. [The] claim is not a claim in debt." (Para. 12.) Obviously, Mr. Moses would have to amend his pleadings to reflect the foregoing if his action were to proceed. [13] The LNIB opposed the granting of the relief sought, asserting in its Response that: 20. The Plaintiff is not seeking damages, but instead is [sic] an attempt to claim costs in a Federal Court action, in which the Federal Court explicitly made no order as to costs.

21. Accordingly, the Defendant submits that the Plaintiff has no right in law or contract for legal fee reimbursements as a result of Justice Campbell's Consent Order.

22. Further, and in the alternative, the Plaintiff is estopped, in whole or in part, from advancing his claim by virtue of the doctrines of res judicata or issue estoppel, or because his claim represents an impermissible abuse of process.

23. Further, and in the alternative, this matter is outside of the jurisdiction of the Supreme Court of British Columbia, pursuant to the Federal Courts Act, R.S.C. 1985, c. F-7.

24. Further, and in the alternative, this matter is outside of the jurisdiction of the Supreme Court of British Columbia, pursuant to Justice Campbell's Consent Order.

25. Alternatively, if the Plaintiffs claim consists of a new cause of action, then Plaintiff's action is time barred under the Limitation Act, R.S.B.C. 1996, c. 266.

26. The Defendant denies that the Plaintiff is entitled to reimbursement for legal costs incurred pursuant to any LNIB law, policy, custom or practice.

27. The Defendant denies that it has been unjustly enriched.

28. The Defendant denies that its conduct, or that of its council members, constituted misfeasance of public office.

29. In further answer to the whole of the Notice of Civil Claim, the Defendant states that the Plaintiffs claim discloses no reasonable cause of action against the Defendant. The Defendant states that the Plaintiff is not entitled to the relief claimed. [14] In October 2013, the Band applied to the Supreme Court for an order striking the action, or in the alternative, an order for summary judgment dismissing the claims, essentially on the bases set forth above. The Chambers Judge's Reasons [15] The matter came on for hearing before the chambers judge below on December 2, 2013 and she issued her reasons for judgment, indexed as 2014 BCSC 643, on April 15, 2014. Ultimately, she found it necessary to address only whether the claim for malfeasance was statute-barred and whether Mr. Moses' claim in unjust enrichment should be struck as disclosing no reasonable cause of action. She found against Mr. Moses on both issues. Limitation Periods [16] The LNIB contended that both claims asserted by Mr. Moses had been subject to a two-year limitation, which had expired some years ago. The plaintiff on the other hand submitted that the tort of misfeasance in public office was subject to a limitation period of six years and that the unjust enrichment claim was not subject to any limitation. Alternatively, if a two-year limitation applied, he submitted that time did not become begin to run until January 25, 2013, the date of the Band's refusal to reimburse his legal fees. (Paras. 15-16.) The parties did agree that the former Limitation Act, R.S.B.C 1996, c. 266 was applicable, rather than the "new" Limitation Act, S.B.C. 2012, c.

13. The chambers judge concurred, and her conclusion is not challenged on appeal. [17] The former Limitation Act provides in section 3 that: (2) After the expiration of 2 years after the date on which the right to do so arose a person may not bring any of the following actions: (a) subject to subsection (4)(k), for damages in respect of injury to person or property, including economic loss arising from the injury, whether based on contract, tort or statutory duty; . . . (5) Any other action not specifically provided for in this Act or any other Act may not be brought after the expiration of 6 years after the date on which the right to do so arose. [18] With respect to misfeasance in public office, the judge noted the elements of the tort as summarized by the Supreme Court of Canada in Odhavji Estate v. Woodhouse 2003 SCC 69: the tort of misfeasance in a public office is an intentional tort whose distinguishing elements are twofold: (i) deliberate unlawful conduct in the exercise of public functions; and (ii) awareness that the conduct is unlawful and likely to injure the plaintiff. Alongside deliberate unlawful conduct and the requisite knowledge, a plaintiff must also prove the other requirements common to all torts. More specifically, the plaintiff must prove that the tortious conduct was the legal cause of his or her injuries, and that the injuries suffered are compensable

in tort law. [At para. 32.] [19] The judge cited two decisions of the British Columbia Supreme Court that in her view established that the applicable limitation period was two years: see Berscheid v. Ensign [1999] B.C.J. No. 1172 and Foote v. Canada (Attorney General) 2012 BCSC 1732 and 2013 BCCA 135. In the absence of postponement, she continued, the date of injury (i.e., the date from which the limitation period would run) was either the date of the second resolution or the date on which Mr. Moses incurred his legal fees. In either case, the two-year limitation had long expired. (Para. 31.) [20] Although the plaintiff did not specifically claim postponement in his response to the motion or in his submissions, questions of "discoverability" under s. 6(4) of the Act were raised at the hearing in chambers. In particular, Mr. Moses contended that following his reinstatement as chief, he had been unable to seek reimbursement of his legal fees because members of the "Council Table" refused to attend meetings. The chambers judge rejected this submission and concluded there were "no real issues concerning postponement." (Para. 36). In particular, she reasoned: Mr. Moses knew the identity of the potential defendants from the moment his claim arose. Further, at that time all of the facts of the case were within his means of knowledge as meant by s. 6(4). While those facts cannot be

said to show that the action would have a reasonable prospect of success apart from the limitation period, that is due to the weakness of Mr. Moses' claim rather than any facts remaining undiscovered. Finally, in light of his particular circumstances and interest, he was fully able to bring an action as of the date his claim arose. Simply because he felt he was unable to "make his case" or negotiate with the defendant during a period of instability did not prevent him from bringing an action within the two-year time frame. [At para. 37.] [21] The Court also rejected the contention, based on Vance v. Peglar (1996) 22 B.C.L.R. (3d) 251 (C.A.), that the limitation period did not begin to run until January 25, 2013, the date the Band rejected the plaintiff's request for reimbursement. The judge noted that Mr. Moses had not pursued any legal process in the three years between the time he incurred the loss and the commencement of the action. He had simply written to the Band twice in 2010 and when he received no answer, waited for another two years to try again. The Court found that these facts clearly distinguished this case from Vance and that there was no basis to support a finding of postponement of the limitation period. This finding is not challenged on appeal. [22] In the result, Mr. Moses' claim for damages as a result of misfeasance in public office was dismissed as

statute-barred. [23] The chambers judge next turned to unjust enrichment. She rejected both the plaintiff's submission that there was no limitation period applicable to such a claim, and the Band's submission that the claim was one for economic loss "based upon an allegation of breach of statutory duty", such that the two-year limitation period in s. 3(2)(a) of the Act applied. (Evidently, the reference at the end of para. (a) of s. 3(2) to economic loss arising from "statutory duty" was relied on as a stand-alone provision separate from "injury to person or property".) Instead, the judge found that the six-year limitation period described in s. 3(5) applied. In her analysis: The defendant's argument that s. 3(2)(a) should govern does not take into account the introductory phrase in s. 3(2)(a), which specifies " for damages in respect of injury to person or property,". This is a claim for economic loss. As stated by the British Columbia Court of Appeal in Armstrong v. West Vancouver (District), 2003 BCCA 73 at para. 10: [10] It is now settled that a claim for pure economic loss is not "injury to property" within s. 3(2)(a) of the Limitation Act: see Alberni District Credit Union v. Cambridge Properties Ltd. (1985), 65 B.C.L.R. 297(C.A.); Workers' Compensation Bd. (British Columbia) v. Genstar Corp. (1986), 24 B.C.L.R. (2d) 157 (C.A.). The applicable limitation provision is

therefore s. 3(5) which sets a basic limitation period of 6 years from the date the right to bring the action arose. Many cases have held that, generally, an unjust enrichment claim is subject to a six-year limitation period: Hansen Estate v. Hansen, 2005 BCSC 305; Guzzo v. Catlin Estate (1989), 38 B.C.L.R. (2d) 41 (C.A.); Deutschmann Estate v. Fallis, 2011 BCSC 1009; Can-Auto Inspections Inc. v. Vascor, Ltd., 2011 BCSC 1644 and Peace Portal Properties Ltd. v. Surrey (District), [1989] B.C.J. No. 533 (S.C.). Accordingly, the plaintiff's claim for restitution, based upon unjust enrichment, is not barred by the passage of time. The defendant's application for summary judgment in respect of this cause of action is dismissed. [At paras. 47-50.] Application to Strike [24] Finally, the chambers judge addressed the Band's application to strike the surviving unjust enrichment claim. After reviewing some case law relating to Rules 9-5(1)(a) and (d) of the Supreme Court Civil Rules, she noted the well-known elements of unjust enrichment - the enrichment of the defendant, a corresponding deprivation of the plaintiff, and the absence of juristic reason for the enrichment. (Para. 59). These elements were described in Stevested Machinery & Engineering Ltd. v. Metso Paper Ltd. 2014 BCCA 91, where Tysoe J.A. stated for the Court: [Kerr v. Baranow, 2011 SCC 10,] contains an excellent discussion

by the Supreme Court of Canada of the doctrine of unjust enrichment. Mr. Justice Cromwell, for the Court, said the following about the element of enrichment: For the first requirement -- enrichment -- the plaintiff must show that he or she gave something to the defendant which the defendant received and retained. The benefit need not be retained permanently, but there must be a benefit which has enriched the defendant and which can be restored to the plaintiff in specie or by money. Moreover, the benefit must be tangible. It may be positive or negative, the latter in the sense that the benefit conferred on the defendant spares him or her an expense he or she would have had to undertake [Peel (Regional Municipality) v. Canada, [1992] 3 S.C.R. 762], at pp. 788 and 790; [Garland v. Consumers' Gas Co., 2004 SCC 25] at paras. 31 and 37). In Peel, Madam Justice McLachlin (as she then was) explained that the benefit must be incontrovertible, which she described as a "gain of 'a demonstrable financial benefit' or the saving of an 'inevitable expense'" (p. 794). She went on to say the following at p. 795: An "incontrovertible benefit" is an unquestionable benefit, a benefit which is demonstrably apparent and not subject to debate and conjecture. Where the benefit is not clear and manifest, it would be wrong to make the defendant pay, since he or she might well have preferred to decline

the benefit if given the choice. [At paras. 29-30; emphasis added.] Applying this reasoning, the chambers judge ruled that that Mr. Moses had not pleaded any facts that would support the "enrichment" element of the cause of action - i.e., that the pleadings contained no facts to support a claim that the LNIB had received a "tangible benefit" as a result of the plaintiff's payment of his own legal fees. [25] Given this finding, it was unnecessary for the chambers judge to proceed with the balance of the defendant's arguments regarding issue estoppel and abuse of process. In the result, she dismissed the entire action, the claim for damages based on misfeasance in public office being statute-barred, and no reasonable cause of action for restitution based on unjust enrichment having been pleaded. Mr. Moses did not apply below to amend his pleadings. On Appeal [26] In this court, Mr. Moses submits that the chambers judge: (a) erred in law by failing to give effect to the words in s. 3(2)(a) of the Act and failing to apply authoritative principles on the meaning of that section; (b) erred in law by applying a more demanding standard on an application to strike pleadings; and (c) erred in principle by failing to consider whether the appellant should be given an opportunity to amend his pleadings. [27] The plaintiff submits, and the Band agrees, that the issue concerning the

applicable limitation period is one of law to which the standard of review is correctness; and that the latter two grounds of appeal are largely discretionary and thus warrant a more deferential standard. Misfeasance in Public Office - Injury to Person? [28] I reproduce again for convenience ss. 3(2)(a) and (5) of the former Limitation Act: 3. (2) After the expiration of 2 years after the date on which the right to do so arose a person may not bring any of the following actions: (a) subject to subsection (4) (k), for damages in respect of injury to person or property, including economic loss arising from the injury, whether based on contract, tort or statutory duty; . . . (5) Any other action not specifically provided for in this Act or any other Act may not be brought after the expiration of 6 years after the date on which the right to do so arose. [29] The chambers judge reached her conclusion that misfeasance in public office comes within the two-year limitation provided in s. 3(2)(a), on the basis of three decisions cited at para. 29 of her reasons. With respect, I agree with the plaintiff that these cases are of little assistance on that point. In particular, this court's decision in Foote v. Attorney General (Canada) 2013 BCCA 135 addressed only the dismissal of the causes of action described at paragraph 12 of the reasons of Mr. Justice Low, leaving in place the claim of misfeasance in public office. The court below had done the same on the on the basis that the running of the limitation period might be postponed: see 2012 BCSC 177 at para.

26. As for Berscheid, while it is true that the Court stated at para. 143 that the plaintiff's claim for misfeasance of public authority was "long statute barred", it does not appear that the applicability of s. 3(2)(a) of the Act was the subject of argument. [30] Mr. Moses contends that the chambers judge failed to consider other relevant authorities and to give effect to the words of the Limitation Act. In support, counsel notes in particular Martin v. Insurance Corp. of British Columbia (1979) 13 B.C.L.R. 163 (S.C.), which was expressly approved by the Supreme Court of Canada in Arndt v. Smith [1997] 2 S.C.R. 539. [31] In Martin the plaintiff sued his employer, ICBC, for wrongful dismissal, and his union for failing to represent him fairly in pursuing his grievances against ICBC. The defendants sought to have the action dismissed on the basis that the words "injury to person" in what was then s. 3(1)(a) of the Limitation Act, R.S.B.C. 1979, c. 236 should be interpreted broadly, as covering all actions for damages involving "wrongful acts or treatment" and that "injury" should be equated with "wrong" and thus include economic loss arising from a "wrong". Darling L.J.S.C. did not agree. He ruled that the words "damages" and "injury to person" in the Act should be "equated to damages in respect of personal or physical injuries to an individual". (My emphasis.) Further, he

observed: After examining the Act as a whole and correlating the various sections, I have concluded that section 3(1)(a), "damages in respect of injury to person", should be given not only its ordinary and natural meaning but also the meaning ascribed to it by settled law over many years, namely, physical, emotional or mental injury to the body or mind of the individual. [At 167; emphasis added.] [32] In Arndt, the plaintiff was the mother of a child who had been born with significant disabilities as a result of the mother's contracting chickenpox during her pregnancy. The mother sued her physician for costs associated with raising her daughter. Three separate sets of reasons were delivered by the Supreme Court, but all members of the Court concurred with the reasoning of McLachlin J. (as she then was) to the effect that the mother's claims for economic loss were "not statute barred because they [did] not relate to personal injury" either to the mother or child. McLachlin J. continued: In Martin v. Insurance Corp. of British Columbia , the court held that injury to person means physical, emotional or mental injury to the body or mind of the individual. Unlike her claim for emotional trauma, stress and loss of enjoyment of life, Ms. Arndt's claims for economic loss do not relate to physical, emotional or mental injury to her body. Nor do the injuries represent physical,

emotional or mental injury to Miranda because Dr. Smith did not cause the child's injuries. The action for economic loss is for the expenses incurred in raising Miranda. Dr. Smith's negligent failure to fully inform the plaintiff could have caused loss only in the sense that it was a factor leading to Miranda's birth. It is therefore not caught by the wording of s. 3(1)(a) of the Limitation Act. [At 576.] [33] From these cases I take it that while "injury to person" is not confined to physical or bodily injury, the claim must be in respect of some identifiable injury to the body or mind of the plaintiff. It also seems implicit in Arndt that "emotional injury" is limited to specifically pleaded claims for "emotional trauma, stress [or] loss of enjoyment of life" - none of which the plaintiff in the case at bar has pleaded or suggested in argument. [34] It follows in my view that Mr. Moses' claim for misfeasance in public office was not one for damages "in respect of injury to person". Injury to Property? [35] As far as "injury to property" is concerned, the plaintiff says this court has held that the phrase connotes "physical injury" or "direct damage" to property - an element not present here. On this point, counsel referred us to the brief reasons of Chief Justice Nemetz in British Columbia Hydro & Power Authority v. Homco International Ltd. (1980) 25 B.C.L.R.

181. At para. 3, the Chief Justice adopted the reasoning in Chang v. Price Properties Ltd. (1978) 8 B.C.L.R. 16 (S.C.) that: s. 3(1)(a) is meant to cover personal injury claims and damage to property arising primarily in tort but also, in some circumstances, from breach of contract and breach of statutory duty. Actions arising from breach of contract not involving physical injury or direct damage, in my view, do not fit within this section. [At 182; emphasis added.] [36] We were also referred to Alberni District Credit Union v. Cambridge Properties Ltd. (1985) 65 B.C.L.R. 297, where Hinkson J.A. said this in connection with a claim for the defective construction of a building: Counsel on both sides have referred us to cases which equate injury to direct damage. Without holding that that necessarily is a precise equation, I agree that injury imports something in the nature of physical injury or damage. This building simply has not, in plain language, been injured. So the action is not one in respect of injury to property. It may be, as the defendants assert, that the defect has resulted in some physical damage or injury. But, in the old language, that is not something which is of the gist of the cause of action. [Para. 15; emphasis added.] [37] Finally, in Workers' Compensation Board of British Columbia v. Genstar Corp. (1986) 24 B.C.L.R. (2d) 157, another case involving

allegedly faulty construction, a five-judge panel of this court stated: I cannot accept Genstar's contention that the action against it is for damages for "injury to property". I am persuaded by the authorities that "injury to property" refers to the situation where property is damaged by an extrinsic act, and not to the situation where a claim is made for damage occasioned by defects in the property itself. In Alberni District Credit Union v. Cambridge Properties Ltd., the issue, as in the case at bar, was whether the limitation period applicable to a claim for defects in the building was the two-year limitation period provided by s. 3(1)(a) of the Limitation Act, or the six-year limitation period provided by s. 3(4). Esson J.A., speaking for the Court, held that the action was not one in respect of "injury to property", as the "building simply has not, in plain language, been injured". Accordingly, the six-year limitation period was held to apply. Counsel for Genstar seeks to distinguish the Alberni case on the grounds that the claim there was for breach of contract rather than in tort. In my opinion, that distinction cannot be sustained. Whether the action is brought in contract or tort, damage is an essential element of it. The question in each case is whether that damage comes within the phrase "injury to property". Other authorities support the same view. In British

Columbia Hydro & Power Authority v. Homco International Ltd. , this court held that the phrase "injury to property" did not apply to a claim for damages arising from defective gas fitting tees that fractured during testing procedures. The court stated that to fall within the ambit of the phrase "injury to property", an action must be one for physical injury or for direct damage to property. [At 161-2; emphasis added.] [38] For its part, the Band submits that the proper characterization of Mr. Moses' claim of the "injury" suffered by him is his loss of elected position, which the Band submits is an "injury to person". Further, it says the "loss" claimed by Mr. Moses in respect of legal fees constitutes "economic loss arising from the [personal] injury". On this point, LNIB cites Brown v. Canada (Attorney General) 2014 BCSC 357, where the Court stated in obiter that a claim for misfeasance in public office was caught by s. 3(2)(a) of the Limitation Act. (See para. 20.) [39] In general, however, the law distinguishes between "pure economic loss" and economic loss arising from a personal injury. This distinction is described by Professor Feldthusen in "Pure Economic Loss Consequent Upon Physical Damage to a Third Party" (1977) 16 UWOL Rev. 1 as follows: Consequential economic loss is a financial loss which by definition is always claimed by the same party who has suffered physical

damage. It is a loss one suffers because one has suffered physical damage Pure economic loss is a financial loss which is not consequent upon injury to the plaintiff's own person or property. [At 4; emphasis added. Cited with approval in Canadian National Railway Co. v. Norsk Pacific Steamship Co. (1990) 65 D.L.R. (4th) 321 (Fed. C.A.).] No reason has been suggested to us as to why this reasoning would not apply in the context of the former Limitation Act, and the wording of s. 3(2)(a) - i.e., "injury to person or property, including economic loss arising from the injury" - strongly suggests that it does. [40] Given the foregoing, and in particular the interpretation of "injury to the person" adopted in Martin and Arndt, supra, I conclude that Mr. Moses cannot be said to have suffered economic loss arising from personal injury. I find, with respect, that the chambers judge erred in ruling that the plaintiff's claim for misfeasance in public office fell within s. 3(2)(a) of the Limitation Act. It follows that this claim was subject to a six-year, rather than a two-year, limitation and was thus not statute-barred. Rule 9-5 [41] I turn next to whether the chambers judge erred in striking Mr. Moses' claim for unjust enrichment under Rule 9-5. It is trite law that before a claim may be struck under Rule 9-5, it must have "no reasonable prospect of success". Stated another way, it

must be "plain and obvious" that the cause will fail. (See R. v. Imperial Tobacco Canada Ltd. 2011 SCC 42 at para. 17; Johnstone v. Gardiner 2012 BCCA 184 at para. 17.) At the same time, the law must be permitted to evolve. If there is some realistic chance that the cause of action could be 'saved' by a future development, the court should allow the action to proceed. As Chief Justice McLachlin stated in Imperial Tobacco: Valuable as it is, the motion to strike is a tool that must be used with care. The law is not static and unchanging. Actions that yesterday were deemed hopeless may tomorrow succeed. Before Donoghue v. Stevenson, [1932] A.C. 562 (H.L.) introduced a general duty of care to one's neighbour premised on foreseeability, few would have predicted that, absent a contractual relationship, a bottling company could be held liable for physical injury and emotional trauma resulting from a snail in a bottle of ginger beer. Before Hedley Byrne & Co. v. Heller & Partners, Ltd., [1963] 2 All E.R. 575 (H.L.), a tort action for negligent misstatement would have been regarded as incapable of success. The history of our law reveals that often new developments in the law first surface on motions to strike or similar preliminary motions, like the one at issue in Donoghue v. Stevenson. Therefore, on a motion to strike, it is not determinative that the law has not yet recognized the

particular claim. The court must rather ask whether, assuming the facts pleaded are true, there is a reasonable prospect that the claim will succeed. The approach must be generous and err on the side of permitting a novel but arguable claim to proceed to trial. [At para. 21; emphasis added.] (See also Hunt v. Carey Canada Inc. [1990] 2 S.C.R. 959 at 980.) Further, if a cause of action requires clarification by an amendment, the court should allow the plaintiff to make such amendment as a condition of dismissing the application under Rule 9-5: see, e.g., Minnes v. Minnes (1962) 39 W.W.R. 112 (B.C.C.A.) and Horton Bay Holdings Ltd. v. Wilks (1991) 3 C.P.C. (3d) 112 (B.C.C.A.) at 116. Misfeasance in Public Office [42] I have already noted the 'elements' of misfeasance in public office, as stated in Odhavji at para.

17. The Band contends that Mr. Moses' pleadings and his affidavit filed in support failed to plead any material facts that the LNIB engaged in deliberately unlawful conduct or knew that its conduct was unlawful. On this point, it draws a distinction between "unlawful conduct in passing a resolution and an unlawful resolution passed lawfully." In its analysis: The LNIB Council, at the time, was acting within its authority to discipline the Appellant. It is within the LNIB Council's power and authority to suspend or impeach a council member under either the LNIB Chief and Council Policy and Guidelines or the LNIB Custom Election Rules. Although the February 23, 2010 [resolution] was ultimately found to be unlawful, there was no finding and there is no evidence that the LNIB Council's conduct in passing the [resolution] was unlawful. [Emphasis added.] [43] With respect, it is not at all clear that the Council was indeed acting when some of its members purported to pass the resolutions; nor is it clear that if the Council was acting, it was acting lawfully or "within its authority to discipline the [plaintiff]." More to the point, the Band's argument ignores the fact that it consented to a court order which stated that the resolutions were "invalid and unlawful". [44] The even greater difficulty that I see in Mr. Moses' pleading is that it seems to equate the five councillors who

purported to pass the invalid resolutions, with the Band itself. Only the Band is named as a defendant in this proceeding. It is difficult to conceive how it could be said to have committed the tort of misfeasance in public office: the only public "offices" or "functions" in this case are those of councillors and chief, which are obviously held by individuals. The five councillors opposed to the plaintiff's holding office were defendants in the Federal Court action, but are not named in this proceeding. [45] It is important, however, to bear in mind the high onus that must be met before a cause of action may be struck under Rule 9-5. I suppose it might be arguable that if the pleadings were amended to allege that the five councillors who signed and purportedly passed the resolutions committed the tort in the course of their duties, the principle of vicarious liability might (and on this I express no opinion) be stretched far enough to permit Mr. Moses to look to the Band itself for "damages" in the form of his legal fees. Accordingly, I decline to strike out the claim for misfeasance at this point. I would allow Mr. Moses 30 days in which to amend his pleadings to plead a proper case in misfeasance in public office against the LNIB. Failing this, the Band would be at liberty to return to the Supreme Court of British Columbia to re-assert a motion to strike the misfeasance claim

under Rule 9-5. Issue Estoppel [46] As mentioned earlier, the principle of issue estoppel was not dealt with by the judge below. However, it was argued in this court. [47] Ordinarily, one might read para. (f) of the Federal Court's consent order to mean that costs were simply not intended to be dealt with by the order. However, there is ample authority to suggest that at least in the Federal Court, the phrase "No order as to costs" is used synonymously with phrases such as "Neither party is entitled to costs" or "Each party shall bear its own costs". For example, in Hameed v. Canada (Citizenship and Immigration) 2009 FC 591, O'Reilly J. seemed to equate the phrase "No order as to costs" with an order that neither party was to have its costs. At para. 7 he stated: In my reasons for judgment, I made clear that the issues arising in the two judicial reviews were somewhat different. In my view, therefore, the circumstances do not warrant an award of costs. However, the circumstances did merit the particular order that I issued directing the assessment of Mr. Hameed's educational credentials. In light of that order, there will be no order as to costs. [At para. 7; emphasis added.] Similarly, in Richards v. Canada (Minister of National Revenue) 2005 FC 24, Harrington J. explicitly equated the phrase "There shall be no order as to costs" with the phrase "Each party shall bear its own

costs". He first noted the following passage from Orkin, The Law of Costs (2nd ed., 1998): Similarly if judgment is given for a party without any order being made as to costs, no costs can be assessed by either party, so that when a matter is disposed of on a motion or at trial with no mention of costs, it is as though the judge had said that he saw fit to make no order as to costs. [At para. 105.7; emphasis added.] He then noted that in the circumstances of the case, costs awards were precluded by the applicable rules, and thus: Because of this rule, orders in immigration and refugee cases normally do not mention court costs. It is not necessary to say "there shall be no order is to costs" or "each party shall bear its own costs" because the rules already so provide unless the Court derogates therefrom. [At para. 16; emphasis added.] [48] Other decisions of the Federal Court suggest that where an order was unopposed or success was divided, the Federal Court routinely uses the phrase "No order as to costs": see Collings v. Canada 2010 FC 712 at para. 4; Rolls-Royce v. Fitzwilliam 2003 FCT 348 at para. 6; and Couchiching First Nation v. Baum 2010 FC 322 at para.

23. Reference may also be made to the decision of the Ontario Court of Appeal in Coniagas Reduction Co. v. Ontario (Hydro-Electric Power Commission) [1932] O.R. 463, where Riddell J.A. observed at 466 that "No order as to costs" is the "settled terminology of a direction that no costs go to either party." [49] If one assumes, then, that the consent order effectively directed that the parties were to bear their own costs, does it establish an estoppel against Mr. Moses' claim for "damages" in tort in the amount of his legal fees? It appears that on the law as it now stands, a consent order may, like any other order of a court, give rise to issue estoppel or cause of action estoppel: see Donald Lange, The Doctrine of Res Judicata in Canada (3rd ed., 2010) at 351-365. The more difficult question arises from the long-established rule that for issue estoppel to apply, the parties or their privies "should have claimed or defended in the same right in the former proceedings as they represent in the later ones." (See Halsbury's Laws of England (4th ed.), vol. 16, at para. 993; my emphasis.) This is the requirement of "mutuality" (which I note was abandoned in the U.S. some years ago). [50] Lange notes that the mutuality requirement was firmly established by the Supreme Court of Canada in Toronto (City) v. Canadian Union of Public Employees, Local 79 2003 SCC 63, which involved the

relitigation of a criminal conviction in a union grievance proceeding. The Court reviewed the American jurisprudence on the topic but saw "no need to reverse or relax the long-standing application of the mutuality requirement in this case ". It concluded that "appropriate guidance" was available in Canadian law with the doctrine of issue estoppel "without the modification to the mutuality requirement that this case would necessitate at." (At para. 25). In Danyluk v. Ainsworth Technologies Inc. 2001 SCC 44, however, the Court intimated in obiter that the debate was not over. The Court declined to address the issue of the "same parties" test and the influence of American jurisprudence on the question of mutuality, noting that in the case before the Court, the parties were identical and "the outer limits of 'mutuality' and of the 'same parties' requirement need not be further addressed." (At para. 60.) [51] In the case at bar, of course, the LNIB is the defendant; in the earlier Federal Court action, the applicants for judicial review were said to be Mr. Moses and the Band "as represented by counsellor Connie Joe and counsellor Harold Joe". It is far from clear whether the two councillors had the authority to represent the Band in this way and make it a party to the litigation. Assuming it was a party, it was challenging the resolutions by judicial review, but must be taken to

have consented to the parties' bearing their own costs. In the present proceeding, the Band's position would presumably be to rely on para. (f) to create an estoppel against Mr. Moses' claim. Is it acting in the present proceeding "in the same right" as in the Federal Court action? [52] It is impossible for us to answer these technical questions at this stage of the proceeding, especially without the benefit of whatever amendments are to be made to Mr. Moses' pleadings. (In this regard, our position is similar to that of the Court in Canadian Shredded Wheat Co. Ltd. v. Kellogg Co. of Canada [1939] S.C.R.

329. There, similarly difficult and technical questions regarding the parties' capacities were raised, leading the Court to conclude that the question was a "technical point to which effect ought not to be given in the circumstances.") (See Lange, supra, at 80.) Nor is it possible at this stage to judge the likely success of an argument based on abuse of process, which normally involves "such principles as judicial economy, consistency, finality and the integrity of the administration of justice." (Toronto v. CUPE, supra, at para. 37.) I again decline, then, to strike out the claim for misfeasance, but would leave it open to the trial judge to do so with the benefit of the amended pleadings and evidence. Unjust Enrichment [53] I turn finally to the plaintiff's claim for unjust enrichment, which the chambers judge dismissed on the basis that no "tangible benefit" had been pleaded. [54] Mr. Moses' first submission under this rubric is that the chambers judge "assessed the pleadings with a view to determining whether the [plaintiff] had actually transferred a benefit" to the LNIB, as opposed to determining whether the plaintiff had pleaded the cause of action. Counsel refers to the following assertions in the Notice of Civil Claim: 19. The control of LNIB funds resulting from the motion/the First [resolution] on January 24, 2010 by the Defendant council/The Council Table, enabled them to pay their solicitor's legal bill from LNIB funds and to deny reimbursement of the legal fees of $99,000.00 of Moses and the LNIB Council that opposed them in court file No. T-209-10 Federal Court which fees were paid by Moses. . . .

3. The Policy and Procedures for Chief and Councillors (1997) provided, inter alia, that: (24) In addition [to] the duties and obligations contained in paragraph[s] 11 to 22[,] the Chief has powers, duties and obligations to: (e) Make decisions when required on behalf of Council when such decisions are necessary for good government.

5. The Defendant, Lower Nicola Indian Band, has been unjustly enriched by the value of the legal fees incurred for its benefit by the Plaintiff [55] The plaintiff says it is at least arguable that a benefit was "provided" to the Band in the form of legal fees expended to defend the "political integrity" of the office of chief and to obtain the rescission of invalid resolutions purportedly passed by the Council. He asserts that the Band was saved "the inevitable expense" of spending its own funds to have the resolution set aside and that this was an "incontrovertible benefit" to the LNIB, which effectively "received the cost of returning to the political status quo, a commodity in a band mired in political turmoil." Further, since the consent order of the Federal Court directed that the Council cease passing resolutions in secret, "compelling some measure of order and transparency", Mr. Moses submits the Band received and retained a "tangible benefit". On this point, counsel cited Peel v. Canada, supra, where McLachlin J., as she then was, noted that a benefit may be "negative" in the sense that the defendant was "spared an expense which he or she would have been required to undertake, i.e., the discharge of a legal liability." (At 790.) [56] The Court made it clear in Peel, however, that the "incontrovertible benefit" must relate to the payment of a liability that, had the

plaintiff not paid, the defendant would have paid as an "inevitable or necessary" expense. (At 796.) Otherwise, McLachlin J. observed: To admit recovery in this case would be to extend the concept of benefit in the law of unjust enrichment much further than contemplated by any of the authorities to date. It would open the door to recovery wherever a payment has been made under compulsion of law which arguably has an incidental beneficial effect of a non-pecuniary nature. In short, it would take the law of unjust enrichment far beyond the concept of restoration of property, money, or services unfairly retained, which lies at its core. [At 798; emphasis added.] [57] In my view, the requirement of "incontrovertible benefit" (or in Cromwell J.'s phrase in Kerr v. Baranow 2011 SCC 10, "tangible benefit") precludes any possibility that by paying his own legal fees, Mr. Moses would be found to have conferred a benefit on the Band that could properly be the subject of a claim for unjust enrichment. It is entirely a matter of opinion whether the Band benefited from the plaintiff's expenditure of funds on legal fees to rescind the two resolutions, notwithstanding that they were stated in the consent order to be invalid and unenforceable. Any assumed benefit cannot be said to have constituted a "demonstrable financial benefit", nor could it be found the Band was saved an "inevitable

expense". (Peel at 794-5.) [58] As for the plaintiff's argument that this Court's approach should be "generous and err on the side of permitting a novel but arguable claim to proceed", I am satisfied there is no reasonable possibility that Peel and the many cases following it would cease to be authoritative in the near future. To hold otherwise would involve courts of law in assessing intangible effects and circumstances that lie outside the province of judges. What one person might regard as a noble and altruistic effort on Mr. Moses' part to restore the integrity of the office of chief, might be regarded by another as self-serving litigation that was only another stage in an ongoing saga of conflict within the Band. No amendment to Mr. Moses' pleadings that might overcome this difficulty has been suggested. [59] I must say also that the second element of unjust enrichment - absence of juristic reason - would present yet another insuperable barrier to Mr. Moses' claim. Obviously the reason for his being liable to pay his own solicitor's fees was the existence of a contract between client and solicitor. And, as seen earlier, the Band has, by its elected council, declined to pay those legal fees - as it is entitled to do under its Bylaws. On this basis as well, it is plain and obvious that the cause could not succeed. Disposition [60] In the result, I would allow the appeal only

to the extent of setting aside the chambers judge's order dismissing the claim for misfeasance in public office as statute-barred. I would also order, however, that if Mr. Moses does not amend his pleading as contemplated at paras. 12 and 45 above within 30 days, or if the Band wishes to argue that the amendment still fails to disclose a cause of action against the LNIB, the defendant will be at liberty to re-apply to the Supreme Court of British Columbia to have the misfeasance claim dismissed under Rule 9-5. "The Honourable Madam Justice Newbury" I AGREE: "The Honourable Madam Justice D. Smith" I AGREE: "The Honourable Madam Justice Stromberg-Stein"