Nielsen Estate et al. v. Epton et al., (2006) 401 A.R. 63 (CA)

Nielsen Estate v. Epton (2006), 401 A.R. 63 (CA);

      391 W.A.C. 63

MLB headnote and full text

Temp. Cite: [2006] A.R. TBEd. DE.056

Rita Nielsen, Administratrix of the Estate of Gert Bo Nielsen, Rita Nielsen, Shane Nielsen, Thomas Soemond, Kim Nielsen and Joshua Nielsen, an Infant by His Next Friend Rita Nielesn (respondents/plaintiffs) v. Keith Epton (appellant/defendant) and Fred Korby (defendant/not a party to the appeal)

(0603-0077-AC; 2006 ABCA 382)

Indexed As: Nielsen Estate et al. v. Epton et al.

Alberta Court of Appeal

Côté, Costigan and Ritter, JJ.A.

November 30, 2006.

Summary:

A worker died when a "live load" fell on him during an unsafe lifting procedure in a building fabrication plant. Workmen were attempting to flip over an assembled roof unit with a crane, forklift and the workmen standing under the roof using two-by-fours. The plant was managed by Epton, who was a director and part owner. There was no safety equipment or safety training and no written safety procedures at the plant. Profit allegedly trumped safety at Epton's direction. The worker's family sued Epton for negligence, alleging that he was personally liable, as a director, for misfeasance in developing, maintaining and permitting a dangerous work environment. At issue was whether Epton, in his capacity as director, could be found personally liable in tort and, if so, whether others shared that fault.

The Alberta Court of Queen's Bench, in a judgment reported (2006), 392 A.R. 81, held that Epton, in his capacity as director, owed a personal duty of care to his employees. Epton fundamentally breached that duty by creating and maintaining corporate policy which predictably sustained dangerous working conditions. The dangerous work environment was a direct product of Epton's decisions, actions and omissions. The court apportioned fault as follows: Smith, the person who designed the lifting beam used (1%); Atwood, the crane operator (10%); Edworthy, the employee in charge of the lift, (39%); and Epton (50%). The company was vicariously liable for the acts or omissions of the others found at fault and Epton was vicariously liable for the fault of Atwood and Edworthy. Effectively, Epton was found 99% at fault. Epton appealed.

The Alberta Court of Appeal allowed the appeal in part, reducing Epton's liability to 50% of the loss. Epton remained liable in negligence for 50% of the loss, as apportioned by the trial judge, but stated that "Epton was not an employer or controlling agent and there is no principled policy reason for imposing vicarious liability on him. Accordingly, Epton is not vicariously liable for 49% of the loss".

Company Law - Topic 4183

Directors - Liability of directors - For torts - A worker died when a "live load" fell on him during an unsafe lifting procedure in a building fabrication plant - Workmen were attempting to flip over an assembled roof unit with a crane, forklift and the workmen standing under the roof using two-by-fours - The plant was managed by Epton, who was a director and part owner - There was no safety equipment or safety training and no written safety procedures at the plant - Profit allegedly trumped safety at Epton's direction - The worker's family sued Epton for negligence, alleging that he was personally liable, as a director, for misfeasance in developing, maintaining and permitting a dangerous work environment - The trial judge held that Epton, in his capacity as director, owed a personal duty of care to his employees - Epton fundamentally breached that duty by creating and maintaining corporate policy which predictably sustained dangerous working conditions - The dangerous work environment was a direct product of Epton's decisions, actions and omissions - The trial judge apportioned fault as follows: Smith, the person who designed the lifting beam used (1%); Atwood, the crane operator (10%); Edworthy, the employee in charge of the lift, (39%); and Epton (50%) - Epton, as director, was vicariously liable for the fault of Atwood and Edworthy - Effectively, Epton was 99% at fault - The Alberta Court of Appeal allowed Epton's appeal in part, reducing his liability to his personal liability for 50% of the loss - The court stated that "Epton was not an employer or controlling agent and there is no principled policy reason for imposing vicarious liability on him. Accordingly, Epton is not vicariously liable for 49% of the loss".

Torts - Topic 2651.1

Vicarious liability - Particular persons - Directors - [See Company Law - Topic 4183 ].

Torts - Topic 2651.1

Vicarious liability - Particular persons - Directors - The Alberta Court of Appeal stated that "we are not aware of any cases that have imposed vicarious liability on a corporate director for the tortious acts of a corporate employee or volunteer" - See paragraph 25.

Cases Noticed:

Housen v. Nikolaisen et al., [2002] 2 S.C.R. 235; 286 N.R. 1; 219 Sask.R. 1; 272 W.A.C. 1; 2002 SCC 33, refd to. [para. 19].

Montreal Trust Co. of Canada et al. v. Scotia McLeod Inc. et al. (1995), 87 O.A.C. 129; 129 D.L.R.(4th) 711; 26 O.R.(3d) 481 (C.A.), refd to. [para. 20].

Blacklaws et al. v. 470433 Alberta Ltd. (2000), 261 A.R. 28; 225 W.A.C. 28; 84 Alta. L.R.(3d) 270; 2000 ABCA 175, refd to. [para. 20].

P.A.B. v. Children's Foundation et al., [1999] 2 S.C.R. 534; 241 N.R. 266; 124 B.C.A.C. 119; 203 W.A.C. 119; 174 D.L.R.(4th) 45, refd to. [para. 25].

Bazley v. Curry - see P.A.B. v. Children's Foundation et al.

Blackwater et al. v. Plint et al, [2005] 3 S.C.R. 3; 339 N.R. 355; 216 B.C.A.C. 24; 356 W.A.C. 24; 2005 SCC 58, refd to. [para. 27].

Authors and Works Noticed:

Fridman, Gerald Henry Louis, The Law of Torts in Canada (2nd Ed. 2002), p. 277 [para. 25].

Counsel:

K.E. Buss, for the respondents;

D.L. Picco and C. Wendel, for the appellant.

This appeal was heard on November 30, 2006, before Côté, Costigan and Ritter, JJ.A., of the Alberta Court of Appeal.

The following memorandum of judgment was delivered orally for the Court by Costigan, J.A., on November 30, 2006, and filed on December 12, 2006.