Sidhu v. Hiebert

2020 BCSC 418 Sidhu v. Hiebert

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Sidhu v. Hiebert, 2020 BCSC 418 Date: 20200319 Docket: M082472 Registry: Vancouver Between: Arshdeep Singh Sidhu Plaintiff And Jan Abram Hiebert, Balwinder Kaur Sidhu, Rajvinder Singh Sidhu, Surinder Singh Rattan, Nissan Canada Inc., Nissan Motor Co., Ltd., Nissan North America, Inc., Abbotsford Nissan Ltd. Defendants And Insurance Corporation of British Columbia, Jan Abram Hiebert, Balwinder Kaur Sidhu, Rajvinder Singh Sidhu, Surinder Singh Rattan, Nissan Canada Inc., Nissan Motor Co., Ltd., Nissan North America, Inc. and Abbotsford Nissan Ltd. Third Parties Before: The Honourable Madam Justice Forth Reasons for Judgment to Strike the Matthews Report Counsel for the Plaintiff: M.J. Slater, Q.C. S. Jaworski Counsel for the Defendants and Third Parties, Nissan Canada Inc., Nissan Motor Co., Ltd., Nissan North America, Inc., and Abbotsford Nissan Ltd.: G. Cowper, Q.C. M. Parrish G. McDonell Counsel for the Defendants and Third Parties, Balwinder Kaur Sidhu, And Rajvinder Singh Sidhu: No appearance at this hearing Counsel for the Defendant and Third Party, Surinder Singh Rattan: No appearance at this hearing Counsel for the Third Party, Insurance Corporation of British Columbia: No appearance at this hearing Place and Date of Hearing: Vancouver, B.C. February 14, 2020 Place and Date of Judgment: Vancouver, B.C. March 19,

2020 Table of Contents Introduction.. 4 Background.. 5 The plaintiff's claims against Nissan. 5 The Matthews Report 6 Legal Principles. 9 The admissibility of expert opinion evidence. 9 Stage one: threshold requirements. 10 Stage two: gatekeeping function. 11 Punitive damages. 12 Positions of the Parties. 13 Nissan's position. 13 The Plaintiff's position. 14 Issues. 16 Analysis. 16 The timing of this application. 16 Does the Report constitute expert opinion evidence, and if so, what is its nature and scope?. 17 Stage One: Does the Matthews Report meet the threshold requirements for admissibility?. 19 Stage Two: Should the Court exercise its gatekeeper function to exclude the Matthews Report?. 21 Conclusion.. 21 Introduction [1] These are my reasons for judgment on an application by the defendants, Nissan Canada Inc., Nissan Motor Co. Ltd., Nissan North America Inc., and Abbotsford Nissan Ltd. (collectively, "Nissan" or the "Nissan defendants"), to exclude the proposed expert report of Jeff Matthews dated October 30, 2019 (the "Matthews Report" or "Report"), and any oral evidence based on the Matthews Report, from evidence at the trial for this matter. [2] As it relates to this application, the underlying issue at trial is a product liability claim against Nissan for alleged negligence in design, manufacture, distribution, and sale of a 2006 Nissan Pathfinder vehicle (the

"Pathfinder"). On March 8, 2008, the plaintiff, Arshdeep Sidhu, was seated in the rear, driver-side seat of the Pathfinder, which was being driven by his mother, Balwinder Kaur Sidhu, and was owned by his father, Rajvinder Singh Sidhu, when it collided with a vehicle driven by the defendant, Jan Hiebert (the "Collision"). The plaintiff's parents, Mr. Hiebert, and the host of the party that Mr. Hiebert attended prior to the Collision, Surinder Rattan, are also defendants in the action. [3] The Matthews Report is a proposed expert report submitted by the plaintiff in support of his claim for punitive damages against Nissan. It purports to provide a "forensic accounting" opinion respecting the alleged profit earned by various Nissan entities worldwide through cost savings arising from its failure to include certain safety devices in all Nissan vehicles sold from 1994 to the present. [4] Nissan submits that the Matthews Report is "an inflammatory and prejudicial report designed to advance an unpleaded and massively over-stated basis for punitive damages. [It] is little more than counsel's argument as to the quantum of a punitive damages claim thinly wrapped in the guise of expert evidence." [5] Nissan also challenges the Report on constitutional grounds, but the parties have agreed to adjourn the hearing of the constitutional aspect of this application to a later date, if

necessary. As such, I have not considered the constitutional aspects of the application in these reasons. [6] The plaintiff opposes Nissan's application on the basis that the Report meets the admissibility requirements for expert opinion evidence. He says that the application is a collateral attack on his punitive damages claim. Further, he says that the application is premature and the admissibility of the Matthews Report should be addressed during the trial. He is supported in his position by the defendants, Rajvinder Singh Sidhu and Balwinder Kaur Sidhu. [7] For the reasons that follow, I conclude that the Matthews Report is inadmissible for the purposes of providing an expert opinion on the profit gained by Nissan as a result of its alleged failure to include certain safety devices in the rear seats of its vehicles. This is because the Report is founded on assumptions that exceed the scope of the facts and issues raised in the pleadings and that are not relevant or necessary to assessing the plaintiff's claim for punitive damages. Background The plaintiff's claims against Nissan [8] To summarize briefly, the plaintiff advances several claims of alleged defect and negligence in the design and manufacture of the Pathfinder's rear seats' seatbelt, particularly when worn by children of a certain size (including the plaintiff). He asserts that the risk could have been mitigated

through devices that other manufacturers were using at the time the Pathfinder was manufactured, including "comfort guide" shoulder-belt adjusters, and rear seat pretensioners. He further alleges that Nissan failed to warn of the defects and the potential dangers to children who used the rear seats. [9] The pleadings also contain a claim of aggravated and punitive damages against Nissan on the basis that they: acted in a high handed, malicious, arbitrary or highly reprehensible manner that departed to a marked degree from the ordinary standards of decent behaviour, thereby endangering the Plaintiff's life by: (a) Designing, manufacturing, importing, distributing, and/or placing into the stream of commerce the Pathfinder knowing it was defective in design and manufacture; and/or (b) Failing to warn purchasers, owners, and/or users of the Pathfinder and/or failing to recall the Pathfinder knowing it was defective in design and manufacture; and/or (c) Advising purchasers, owners, and/or users of the Pathfinder to place children including the Plaintiff in the rear seats knowing that the restraint systems and/or seat belts were unsafe for their use. [10] Nissan highlights, among other things, that the plaintiff does not plead any facts or allegations respecting: · any alleged defect in the Pathfinder as a result of the failure to equip it with an integrated booster seat; · any

Nissan vehicles other than the 2006 Nissan Pathfinder; · any conduct by any Nissan entity other than the Nissan defendants, or · any conduct by Nissan subsequent to the Collision. [11] The plaintiff brought an application to amend his pleadings to incorporate the failure to include integrated booster seats, but it was abandoned after the hearing of this application. [12] Nissan further highlights that the amended notice of civil claim does not plead that Nissan's decision making relating to the design of the Pathfinder and seatbelt, or their failure to remedy the design or recall the vehicle, was motivated or influenced by a desire to save costs or make profit over safety. It also does not plead that Nissan saved costs or earned profit as a result of its alleged negligent conduct. The Matthews Report [13] The plaintiff served the Matthews Report on October 31, 2019, pursuant to R. 11-6(3) of the Supreme Court Civil Rules, B.C. Reg. 168/2009. On November 28, 2019, Nissan advised the plaintiff that they objected to the Report's admissibility under R. 11-6(10). Nissan provided further objections to the Report on January 2, 2020. [14] Mr. Matthews is an accountant. In the instruction letter dated October 29, 2019 to Mr. Matthews, counsel for the plaintiff asks him to provide "an expert opinion in the field of forensic accounting" with regard to a series of questions respecting the

alleged profit earned by various Nissan entities around the world. The profits are calculated by alleged cost savings arising from Nissan's failure to include certain safety devices in all of its vehicles sold worldwide from 1994 to present. [15] The questions on which Mr. Matthews opined include: a) What is the profit gained by Nissan as a result of the failure to include "comfort guides", rear seat pretensioners, and integrated booster seats (collectively, the "Safety Devices") in the rear seats of all Nissan vehicles, based on a current cost of CDN$1.00 for each device per vehicle? The time period for the calculation differs for each safety device depending on when the device was allegedly required to be integrated into the vehicle design, but ranges from a starting year of 1994 to 1999. The time period ends at the date of trial being March 2020. b) What is the net income of Nissan (from all vehicle sales, worldwide) for the fiscal years 1994 to 2018 in CDN$? c) What is the present value of the investment income that Nissan may have earned on the profit gained, assuming annual rates of return of 1%, 2%, 3%, 4%, and 5%, and assuming inflation rates that were experienced in either the United States or Japan? [16] The purpose of using the $1.00 figure is so that, once the actual cost per device is determined, the profit figure calculated by Mr. Matthews can be multiplied by the

actual cost per device to calculate the total profit gained. [17] The letter instructs Mr. Matthews to assume that if Nissan installed the Safety Devices in its vehicles, Nissan would not have increased the sale prices of its vehicles to offset the additional cost. [18] In the Report, Mr. Matthews provides the following opinions with respect to the profit gained, calculated according to the instructions he was provided (assuming each dollar of cost savings represents a dollar of profit gained): Fiscal Years Assumed Current Cost per unit (CDN$) Profit Gained by Nissan (CDN$) Comfort guides 1994 to 2020 (to Mar-16-20) $1.00 $105,942,000 Pretensioners 1999 to 2020 (to Mar-16-20) $1.00 $92,602,000 Integrated booster seats 1996 to 2020 (to Mar-16-20) $1.00 $100,551,000 Grand Total $229,095,000 [19] In addition to the assumption that the cost savings per device per vehicle sold worldwide during the relevant time period translates directly into profit earned, Nissan draws the following assumptions upon which the Matthews Report is based to the Court's attention: a) all Nissan vehicles sold worldwide during the relevant period were lawfully required to have been, and were capable of being, equipped with the Safety Devices in the rear seats; b) no Nissan vehicles sold worldwide from 1994 to 2020 were equipped with the Safety Devices in the rear seats; c) due to Nissan's failure to equip

all of its vehicles sold worldwide with the Safety Devices in the rear seats, all Nissan vehicles sold worldwide during the relevant time period were unlawful, unsafe, and/or defective; and d) Nissan entities worldwide, achieved a specific amount of cost savings of CDN$3.00 from each Nissan vehicle sold worldwide for the period of 1994 to 2020 as a result of not equipping each Nissan vehicle with the Safety Devices. [20] Nissan says that there are numerous vehicles sold by Nissan entities worldwide (who are not named in this action and who have not attorned to or been made subject to this Court's jurisdiction) that did not have second row seats, meaning that they could not be equipped with the Safety Devices. Nissan also notes that the amended notice of civil claim does not plead any allegation of a tort committed in B.C. by these other Nissan entities. Legal Principles The admissibility of expert opinion evidence [21] Expert opinion evidence is an exception to a qualification of the general rule that all relevant evidence is admissible. The qualification is the exclusionary rule with respect to opinion evidence: witnesses are to testify as to the facts that they perceived, not as to the inferences (or opinions) that they drew from them: White Burgess Langille Inman v. Abbott and Haliburton Co., 2015 SCC 23 at para. 14 [White Burgess]. Opinion evidence is generally inadmissible

as it is the role of the trier of fact, not the witness, to draw inferences and form conclusions. This is based on the idea that ready-made inferences are not helpful to the trier of fact and may even be misleading: White Burgess at para. 14. [22] The exception to this exclusionary rule comes into play only when, due to the nature of the facts, the trier of fact is unable to form his or her own conclusions without the help of an expert: R. v. K.(A.) (1999), 45 O.R. (3d) 641 (C.A.) at paras. 71-72. Necessity is, therefore, a key concern when determining the admissibility of expert evidence. [23] In recent years, courts have become increasingly concerned with the reliability of expert opinion evidence. This concern grounds the analytical framework for determining the admissibility of expert opinion evidence set out by the Supreme Court of Canada in White Burgess, in which Justice Cromwell, writing for the majority, noted the " unmistakable overall trend in the jurisprudence , to tighten the admissibility requirements and to enhance the judge's gatekeeping role": at para. 20. [24] Before assessing the evidence against the two-stage White Burgess framework, the judge must determine the nature and scope of the proposed expert opinion and carefully delineate the boundaries of the proposed opinion: R. v. Bingley, 2017 SCC 12 at para.

17. If admitted, the court has an ongoing duty to ensure that the evidence remains within its proper scope: Bingley at para. 29. [25] Once the scope of the evidence is delineated, the two-stage White Burgess framework requires the court to consider: (1) whether the opinion evidence meets certain threshold requirements or preconditions of admissibility, and (2) whether the trial judge, in exercising his or her gatekeeper function, ought to admit the evidence. [26] The burden rests on the proffering party to establish admissibility in respect of all aspects of the test: White Burgess at para. 48; R. v. Abbey, 2009 ONCA 624 at para.

71. Admissibility is case-specific and cannot be determined by precedent: K.(A.) at para. 76; R. v. J.-L.J., 2000 SCC 51 at para.

45. Stage one: threshold requirements [27] In order to pass the "threshold requirement" stage, the proffering party must demonstrate the existence of the following preconditions (often referred to as the "Mohan factors", referring to R. v. Mohan, [1994] 2 S.C.R. 9): a) The evidence must be logically relevant to a material issue; b) The evidence must be necessary to assist the trier of fact; c) The evidence must not be subject to any other exclusionary rule; d) The expert must be properly qualified, which includes the requirement that the expert be willing and able to fulfil the expert's duty to the court to provide evidence that is impartial, independent, and unbiased; and e) Where opinions are based on novel or contested science, or science used for a novel purpose, the underlying science must be reliable for that purpose See White Burgess at para. 23. [28] In order for evidence to be relevant, the evidence must "tend to 'increase or diminish the probability of the existence of a fact in issue'": R. v. Arp, [1998] 3 S.C.R. 339 at 360. [29] Evidence that is merely "helpful" to the trier of fact does not meet the standard of necessity: Mohan at 23. Necessity is met when the expert evidence: a) provides information which is likely to be outside the experience and knowledge of the trier of fact; b) enables the trier of fact to appreciate the matters in issue due to their technical

nature; or c) where the subject-matter of the inquiry is such that ordinary people are unlikely to form a correct judgment about it if unassisted by persons with special knowledge (in other words, it is an area that is not understood by the average person). Mohan at 22-24. Stage two: gatekeeping function [30] A trial judge in a gatekeeper role must determine whether the benefits of admitting the evidence outweigh its potential risks: White Burgess at para.

24. The gatekeeper stage of analysis is essentially an application of the general exclusionary rule requiring that the probative value of the evidence outweigh its potential for prejudice: Bingley at para. 16. [31] Necessity, reliability, and absence of bias are all relevant to assessing the potential risks of admitting the evidence. Prejudice or costs from admitting the evidence can include the risk of expert opinion usurping the role of the trial judge, delay, and confusion: J.-L.J. at para. 47; Abbey at para.

71. Punitive damages [32] The plaintiff relies on his punitive damages claim to demonstrate the relevance and necessity of the Report. It is therefore relevant to outline the general principles regarding punitive damages. [33] The leading Supreme Court of Canada decision on punitive damages is Whiten v. Pilot Insurance Co., 2002 SCC 18. Whiten involved a home insurance claim arising from a fire in which the insurer denied the claim and alleged that the plaintiff family had committed arson, despite a total absence of evidence to support the allegation, putting the plaintiff and her family in dire financial circumstances. In upholding the jury's award of $1,000,000 in punitive damages, Justice Binnie, for the majority, outlined the fundamental principles governing punitive damage awards: a) Punitive damages are awarded "in exceptional cases for 'malicious, oppressive and high-handed' misconduct that 'offenders the court's sense of decency'", and are limited to "misconduct that represents a marked departure from ordinary standards of decent behaviour": para. 36. b) In directing itself to the punitive damages, the court should relate the facts of the particular case to the underlying purposes of punitive damages and ask itself how, in particular, an award would further one or other of the objectives of the law, and what is the lowest award that would serve the purpose, as any

higher award would be irrational: para. 71; c) It is rational to use punitive damages to relieve a wrongdoer of its profit where compensatory damages would amount to nothing more than a licence fee to earn greater profits through outrageous disregard of the legal or equitable rights of others: para. 72; d) The governing rule for quantum of punitive damages is proportionality. The overall award (including compensatory damages, punitive damages, and any other punishment related to the same misconduct) should be rationally related to the objectives for which the punitive damages are awarded: retribution, deterrence, and denunciation: para. 74; e) Appellate courts are entitled to interfere with a punitive damage award that "exceeds the outer boundaries of a rational and measured response to the facts of the case": para. 76. [34] Punitive damages, including the facts justifying the punitive damages claim, must also be properly pleaded with some particularity so as to give the defendant advance notice of the jeopardy they face and to provide them with the opportunity to respond to it: Whiten at paras. 86-87. [35] With respect to the import of the defendant's size and scale on a punitive damages award, the ratio of the award to the defendant's net worth is a factor, but one of limited importance: Whiten at para.

118. The defendant's net worth or financial power may become relevant if: the defendant argues financial hardship; it is directly relevant to the defendant's misconduct; or other circumstances where it may rationally be concluded that a lesser award against a moneyed defendant would fail to achieve deterrence: Whiten at para.

119. Positions of the Parties Nissan's position [36] Nissan says that the Matthews Report offends the principles of admissibility for expert evidence in the following ways: a) It is based upon and addresses irrelevant facts and matters outside the scope of the plaintiff's pleaded claim; b) It invites the court to make orders and findings on facts and matters outside the court's jurisdiction over the Nissan defendants in this action; c) It is based upon superficial and unreliable methodology which is little more than counsel's argument dressed up as mathematical calculations; d) It is based upon artificial, unreliable, and largely unprovable factual assumptions; and e) It is designed to artificially inflate Nissan's alleged profit for the purposes of anchoring a punitive damages award. [37] Nissan submits that the Matthews Report does not meet the threshold principles for the admissibility of expert evidence for several reasons. First, it is irrelevant on the pleadings in that there is no pleaded allegation that Nissan's decision making respecting the design of the Pathfinder was influenced by cost or profit. Second, it is unnecessary in that it does not properly assist the trier of fact in assessing punitive damages. Third, it contravenes exclusionary rules in that it is actually counsel's argument "dressed up" as an expert opinion. [38] Nissan further submits that the Matthews

Report does not pass the secondary "gatekeeper" stage, balancing probative value, and prejudicial effect. It says that the Report is inherently unreliable because it is founded on unpleaded, incorrect, and unprovable allegations of fact. [39] With respect to the question of timing for this application, Nissan submits that I should exercise my inherent discretion to control the court's processes by excluding this evidence prior to trial. It says that the admissibility should be decided before the trial begins as the Report, and its asserted factual basis, will "further obfuscate the issues" and require additional and unnecessary trial time. The Plaintiff's position [40] The plaintiff submits that Nissan overstates and mischaracterizes the scope of the opinion and factual assumptions underlying the Matthews Report. He submits that the Report is a mechanism for determining the punitive damages to be awarded at trial, depending on the evidence of cost savings. He says that the Report "compiles publicly-available information and applies a mathematical calculation based on a set of assumptions." [41] The plaintiff asserts that there is no element of expert opinion in the Report. He says that the Report falls within the "compendious statement of fact" exception to the rule against opinion evidence. [42] If the Court determines that the Matthews Report constitutes an expert opinion,

the plaintiff submits that it meets the criteria for admissibility. He submits that the calculations of potential punitive damages are relevant, and that proper present value discounting and mathematical methodology found in the Report will be necessary for the trier of fact to consider, should they adopt the methodology of assessing punitive damages underlying the Report. He further submits that the inclusion of economic calculations does not usurp the role of the trier of fact; it merely provides the trier of fact with assistance in assessing damages. [43] With respect to the Court's gatekeeper function, the plaintiff submits that the probative value of the plaintiff's report outweighs any potential prejudice. In particular, he relies on para. 72 of Whiten, where the Court held that "it is rational to use punitive damages to relieve a wrongdoer of its profit where compensatory damages would amount to nothing more than a licence fee to earn greater profits through outrageous disregard of the legal or equitable rights of others." He also points to the British Columbia Civil Jury Instructions notes at 12.19.3, which shows that profit gained by the defendant and the defendant's ability to pay are relevant to making a punitive damages award. [44] The plaintiff submits that this application is a collateral attack on his claim for punitive damages and is equivalent in effect to an

application to strike the punitive damages claim. [45] Finally, the plaintiff submits that the appropriate time to deal with the admissibility of the Report is at the trial. Once the evidence on costs is adduced, the Matthews Report can be used to calculate the profits using the mathematical model provided. Issues [46] The pleadings and submissions raise the following issues: a) Should the admissibility of the Matthews Report be decided during the trial of this matter, rather than as a preliminary application? b) Is the Matthews Report an expert opinion? c) If so, does it meet the White Burgess criteria for admissibility? [47] I note, with respect to the admissibility of the Report, that there are no issues with respect to Mr. Matthews' qualifications as an expert. Analysis The timing of this application [48] I accept that I should exercise my discretion, as the case management judge and the trial judge in this matter, to decide this application before trial. [49] I have considered the plaintiff's submission that the Matthews Report will be illuminated by the actual evidence of costs at trial, and that a ruling at this point would therefore be premature. However, in my view, it is the substance of the calculations and the mathematical models provided in the Matthews Report that are fundamentally at issue in this application. This substance, and whether it meets the

admissibility requirements, will be the same regardless of the evidence of actual costs at trial that are substituted into the calculation. [50] Nissan points to CMC Engineering and Management Limited v. Pinnacle Renewable Energy Inc., 2018 BCSC 2457, as a recent decision of this Court in which objections to expert evidence relating to necessity and whether the expert was usurping the role of the trier of fact were determined before trial. Justice Iyer held that it would be "fair and efficient to do so because it will assist the parties in preparing for the upcoming trial": para. 10. [51] In my view, this application is one in which "it would be salutary to have a case management judge assess the admissibility and usefulness of the proposed expert evidence at an early stage": Masterpiece Inc. v. Alavida Lifestyles Inc., 2011 SCC 27 at para.

100. As in CMC Engineering, it would be fair and efficient to decide this matter now. This is, in part, to allow the parties to properly prepare for trial and, in part, because the parties have spent a day arguing the application and, if it fails at this stage, it will be necessary to hold a further hearing involving the attorneys general to decide the constitutional aspects of the application. Does the Report constitute expert opinion evidence, and if so, what is its nature and scope? [52] The plaintiff relies on Stringer v. Stringer, 2017 BCSC 1470 at paras. 152-153, and Walker v. Leung, 2014 BCSC 1623 at para. 162, in support of his argument that the Matthews Report is not an expert opinion. In my view, these cases are distinguishable. [53] In Stringer, in the context of determining a party's income for spousal support, Watchuk J. considered tables provided by an accountant outlining mathematical calculations of how much income various sums of money would generate over time using different rates of interest. She held that they were not expert opinions, as they did not assist the court in determining the appropriate rate of return, but were admissible as aids to the court as "mathematical extrapolations": at para. 152. [54] In Walker, Chief Justice Hinkson considered "economic reports" proffered by the parties to assist the Court in applying newly amended discount rates which

had just come into effect. He held that, although they were filed as expert reports, "the calculation of present value multipliers for the discount rates to be applied is simply the application of a mathematical formula" and therefore did not need to comply with the notice periods for expert reports: para. 163. [55] The difference between the evidence at issue in Stringer and Walker and the evidence in the Matthews Report is that the Matthews Report purports to determine a material fact to the punitive damages claim, being the profit earned by Nissan as a result of its failure to implement the Safety Devices. It goes beyond providing a "mathematical extrapolation" because, unlike the evidence in Stringer, it is intended to assist the court in determining the appropriate calculation of profit. Although there may be aspects of the Matthews Report that provide less controversial mathematical applications, such as calculations to determine the present value of the profits based on different annual rates of return, it is the underlying figures purporting to determine the profit underlying these calculations that pose the major concerns with respect to the admissibility of this expert opinion in this case. [56] The plaintiff cites Ganges Kangro Properties Ltd. v. Shepard, 2015 BCCA 522 at paras. 69-71, with respect to his argument that the Matthews Report constitutes a "compendious

statement of fact". The Court in that case explained that the compendious statement of facts exception applies where a lay witness is permitted to testify in the form of an opinion in order to more accurately express the facts he perceived, particularly where the facts are too subtle and complicated to be narrated separately and distinctly: paras. 71-72. It applies where the witness has personal knowledge of observed facts; the witness is in a better position than the trier of fact to draw the inference; the witness has the necessary experiential capacity to draw the inference; and the opinion is a compendious mode of speaking and the witness could not as accurately, adequately, and with reasonable facility describe the facts about which he or she is testifying: para. 73. [57] I disagree that the Matthews Report falls into the "compendious statement of fact" exception. This exception applies to circumstances in which the witness is testifying about their perceptions of facts that they have personally observed. The Matthews Report is not about narrating a witness's perception of facts, and it does not fall within the scope of the compendious statement of fact exception. [58] I am satisfied that the Matthews Report purports to provide an expert opinion with respect to the profit gained by Nissan as a result of its failure to include the Safety Devices in the rear seats of its

vehicles, and that this opinion is properly subject to the admissibility criteria outlined above. Stage One: Does the Matthews Report meet the threshold requirements for admissibility? [59] I accept that profit can be relevant to the issue of punitive damages as outlined by the principles in Whiten. However, as Binnie J. emphasized in Whiten, even punitive damages awards must be proportionate to the conduct at issue in the litigation and must be bound by the facts of the particular case. In my view, the evidence of profit that the plaintiff seeks to introduce through the Matthews Report exceeds the bounds of the facts and issues in this case based on the pleadings, and is therefore not relevant and necessary to an assessment of punitive damages. [60] I agree with Nissan's submission that this action is about a particular vehicle--the Pathfinder--and whether it was unsafe or defective; it is not about every vehicle that every Nissan entity sold worldwide over several decades. The Report is premised on the assumption that all Nissan vehicles sold worldwide were unsafe and defective because they lacked certain safety devices. These issues are not raised in the pleadings, and they are not relevant to the plaintiff's claims. [61] Although at the time of the hearing of this application, the plaintiff had planned to bring an application to amend his pleadings to include Nissan's

failure to include integrated booster seats, he has since decided not to go forward with that application. It is clear, then, that the $1 per vehicle sold from 1996 to present on the basis of a failure to include integrated booster seats is irrelevant to the plaintiff's claim. The alleged profits on the integrated booster seats alone represented an alleged profit of over $100,000,000, according to the Report. [62] I accept that the size and scale of Nissan may be relevant to punitive damages, particularly with respect to Nissan's ability to pay and whether the award would have a deterrent effect. However, Nissan does not contest that it has the ability to pay a rational award for punitive damages, should the Court find one to be warranted. [63] I further note that there is no allegation that Nissan saved costs as a result of its alleged misconduct, profited from its alleged misconduct, or that the alleged misconduct was motivated by a desire to save costs or make profits. Thus, even if Nissan's financial power or net worth is relevant to a punitive damages claim, the alleged profits arising from the failure to include the Safety Devices at issue is not relevant to the issues as pleaded. [64] As noted in the Legal Principles, in order for evidence to be necessary, it must provide information likely to be outside my experience and knowledge; enable me to appreciate the matters in

issue due to their technical nature; or assist me in understanding an area that would not otherwise be understood by the average person or that I would be unlikely to form a correct judgment about if unassisted. [65] It seems axiomatic that if the evidence is not relevant, then by definition it is not necessary. However, even assuming that Nissan's profits are relevant to the punitive damages claim, the Matthews Report is still not necessary or helpful for me to consider in adjudicating that claim. In my view, the fact that counsel has instructed Mr. Matthews on how to calculate profit purely as a reflection of cost savings per unit sold takes away any element of expertise that is outside of the average person's knowledge and experience. [66] I also note that the parties have agreed to adduce Nissan's financial statements, and evidence about the costs of the Safety Devices has been provided by Nissan. I will have that evidence before me, and it will still be open to counsel to make arguments about how that information--and any other evidence that is adduced at trial--is relevant to punitive damages as that issue arises. The exclusion of the Matthews Report is not a collateral attack on the plaintiff's plea for punitive damages. The plaintiff will have the opportunity at trial to adduce relevant evidence to that issue and make the arguments necessary to substantiate such a

claim. [67] For these reasons, I find that the Report does not pass the threshold criteria for admissibility. However, for sake of completeness, I will go on to consider the second stage of the White Burgess framework. Stage Two: Should the Court exercise its gatekeeper function to exclude the Matthews Report? [68] Assuming I am wrong about the relevance and necessity of the Matthews Report, I would have significant concerns about its reliability and its probative value compared to its prejudicial effect. [69] I agree with Nissan's argument that there are significant problems respecting the factual assumptions underlying the scope of vehicles included in the Report (for example, including vehicles which did not have rear seats in the calculation), and with respect to counsel's instructions setting the assumptions on how to calculate profit that do not consider relevant economic factors (for example, a failure to consider changes in price over time). For these reasons, the Matthews Report cannot be relied on to support the inference it suggests: that Nissan made millions of dollars in profit worldwide over multiple decades from the cost savings generated from selling defective and unsafe vehicles. [70] In my view, the cost of reconciling the issues underlying the Report, and its distraction from the real issues raised in this action, outweigh any benefit it may provide. I would

exercise my gatekeeping function to exclude the Matthews Report from evidence at trial. Conclusion [71] For the above reasons, I find that the Matthews Report is inadmissible as evidence at trial. [72] To emphasize, nothing in these reasons preclude the plaintiff's ability to argue his punitive damages claim and to put forward admissible evidence with respect to this claim at trial. [73] The Nissan defendants are entitled to their costs of this application in the cause. "Forth J."