Date: 20030616
Docket: T-283-00
Neutral citation: 2003 FCT 752
ADMIRALTY ACTION IN REM AGAINST
THE SHIP "GERTRUDE OLDENDORFF"
AND IN PERSONAM
BETWEEN:
GOODMAN YACHTS LLC
Plaintiff
and
PENGUIN BOAT INTERNATIONAL LIMITED,
MARITIME CLAIMS & SERVICES PTE. LTD.,
RICHARD HOWE,
NEW RESOLUTION SHIPPING CORP.,
EGON OLDENDORFF,
and the Owners and all Others interested in
the Ship "GERTRUDE OLDENDORFF"
Defendants
[1] The action underlying this motion involves a loss of the yacht Paesano,being carried on the deck of the Gertrude Oldendorff from Singapore for delivery at Vancouver, British Columbia.
[2] This motion is for a first stage contempt order, pursuant to Rule 467, against the corporate Defendants New Resolution Shipping Corp. ("New Resolution") and Egon Oldendorff. If successful the order would require those corporations to appear before a judge to hear proof of the contempt. While the second stage of the preceding is in a sense analogous to the trial of a criminal offence, one must keep in mind that the proceeding is one for civil contempt, which has a quasi-criminal aspect to it, but is not a hearing involving criminal contempt.
[3] The alleged contempt arises out of a loss, at Vancouver, of various items of lashing gear, a portion of the cradle which supported the Paesano on the deck of the Gertrude Oldendorff and several pieces of the yacht Paesano which, at the request of the Plaintiff, the Defendants New Resolution and Egon Oldendorff were ordered by this Court on 22 February 2000 to retain and preserve. Pursuant to that Order counsel for New Resolution and Egon Oldendorff arranged, through their surveyors, to have the remains placed in locked storage by Western Stevedoring. In the present instance the Defendant, Penguin Boat International Ltd. ("Penguin Boat"), has failed to establish a prima facie case of the willful and contumacious contempt of the preservation Order which is necessary in order to obtain the order necessary to proceed to the contempt hearing itself.
ADDITIONAL BACKGROUND
[4] By way of additional background this action was commenced 15 February 2000, naming as a defendant Penguin Shipyard. It was not until 24 November 2001 that an amended statement of claim was issued naming Penguin Boat International Ltd. as a defendant. By that time surveyors for the various other parties had looked at the remains which were ordered to be held in storage at the Western Stevedoring facility at its Lynnterm facility in North Vancouver, had taken photographs and, presumably, had issued reports.
[5] From the time of his involvement in about early 2002, counsel for Penguin Boat had been trying to obtain an inspection of the remains which were in storage at Vancouver, but could not get all of the surveyors to agree on a date for the inspection to take place. In the result counsel for Penguin Boat obtained an inspection order on 22 May 2002. Unfortunately that inspection did not take place, for it seems that the remains which were ordered preserved at Vancouver were lost by Western Stevedoring through inadvertence during a regular clean-up of the area conducted by Western Stevedoring which assumed, not having heard anything about the matter for some time, that the material in storage was of no further value.
[6] Nothing is known as to when the material being preserved at Vancouver was lost. Counsel for Penguin Boat first received advice of the loss by letter of 8 August 2002 from counsel for Egon Oldendorff.
[7] In an effort to put Penguin Boat in the best possible position the parties who had surveyors in attendance to examine the remains in storage in Vancouver provided counsel for Penguin Boat with copies of their surveys, with opinion and recommendation sections deleted. Indeed, counsel for New Resolution Shipping Corp. went a little further and provided copies not just of the photographs attached to their surveyor report, but of all photographs taken by their surveyor.
[8] At worst the loss of the opportunity to inspect the material which had been ordered to be stored in Vancouver may well prove critical to Penguin Boat mounting a knowledgeable and effective defence: at best Penguin Boat has been prejudiced. However, this does not provide a prima facie case leading to a contempt proceeding. Before proceeding with an explanation for this conclusion I would add that even were a contempt proceeding to take place, it would neither offer a useful remedy to Penguin Boat nor become a useful precedent.
ANALYSIS
[9] The burden placed upon Penguin Boat, in moving against New Resolution Shipping Corp. and Egon Oldendorff, is that that it must by Rule 467(3) satisfy the Court " ... that there is a prima facie case that contempt had been committed.". A prima facie case is the "... establishment of a legally required presumption that may be rebutted; ...": A Dictionary of Modern Legal Usage, 2nd edition, Garner, Oxford University Press, 1995. Walker, in The Oxford Companion to the Law, Oxford: Clarendon Press, 1980, defines a prima facie case as one sufficient to call for an answer. The Oxford Companion to the Law goes on to point out that:
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Prima facie evidence is evidence which is sufficient to establish a fact in the absence of any evidence to the contrary, but is not conclusive. |
From all of this I take the starting point to be that a prima facie case required by Rule 467(3) is one supported by evidence sufficient that it may be taken as established, subject to appropriate evidence to the contrary. However these definitions do not set out the nature of the case to be made.
[10] As I set out in a survey of case law in Telus Mobility v. Telecommunications Workers Union (2002), 220 F.T.R. 291 (F.C.T.D.) at 295 and following, the applicant must demonstrate a prima facie case of wilful and contumacious contempt of the order in question:
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[10] In order to obtain a show cause order the applicant must demonstrate a prima facie case of wilful and contumacious contempt of the order in question, that being the standard set by Mr. Justice Muldoon in Imperial Chemical Industries v. Apotex Inc. (1989), 25 F.T.R. 47 at 53. More recently Mr. Justice Pinard, in Chic Optic Inc. v. Hakim Optical Laboratory Ltd. (2001), 13 C.P.R. (4th) 283, at 286, relying upon Imperial Chemical and Frank v. Bottle (1994), 68 F.T.R. 242, in which Associate Chief Justice Jerome issued a show cause order on the basis of wilful and contumacious conduct, set the standard as being a wilful refusal to comply with a court order. In effect the test is that of prima facie wilful disobedience. (Page 295) |
As I concluded it must be a wilful refusal to comply with a court order, that is a prima facie wilful disobedience. In Telus Mobility I went on to point out that while the test embodied wilfulness, that element did not automatically imply a need to establish mens res. Rather, "[t]he wilfulness aspect is present only to exclude casual or accidental unintentional acts of disobedience: see Glazer v. Union Contractors Ltd. (1960), 25 D.L.R. (2d) 653 (B.C.S.C.) at 658 and 676, affirmed (1960), 34 W.W.R. 193 (B.C.C.A.).". Thus there is a burden on Penguin Boat to establish more than mere non-compliance.
[11] The concept of non-compliance with a court order as a wilful disobedience of an order was considered in an unreported decision, Whyte v. The Sandpiper VI, 16 May 2002, docket T-257-01, 2002 FCT 572. There Madam Justice Heneghan, dealing with the second stage of a contempt proceeding, pointed out that she was not satisfied that the non-observance of an arrest warrant occurred by reason of a deliberate and conscious intention to disobey in the order. She concluded that a plaintiff, who had brought the contempt proceeding, had not discharge the evidentiary burden. She acknowledged that the subjects of the intended contempt order, who were present, did not and need not give evidence. She reached this conclusion notwithstanding the use of equipment belonging to the dredge which was under arrest.
[12] In the present instance counsel for Penguin Boat has certainly established that there was a preservation order in place and that the remains of the cradle, lashing gear and several pieces of the yacht itself are no longer available to be inspected. This stops short of establishing a deliberate flouting of the preservation order, or wilful and contumacious contempt of the order, or a deliberate conscious intention to disobey the order. What happened here was very unfortunate, however Penguin Boat has not established a prima facie case that the destruction was wilful or deliberate. Rather, what seems to have happened was an accidental or unintentional act of disobedience, without the necessary factor of wilfulness. I say this largely on the basis of what Penguin Boat has failed to establish, but giving some minimal weight to the present hearsay affidavit evidence of the inadvertent disposal of the remains by Western Stevedoring.
[13] Counsel for Penguin Boat makes various points, as rebuttal, several of which I shall deal with. Counsel for Penguin Boat questions whether the subjects of the intended contempt order should be able to take any active part and have input at this preliminary stage. First, that the order may be made ex parte under Rule 467(2) at the first stage of the contempt procedure is merely permissive. Indeed, the giving of notice is recommended in that the result may be closure at the conclusion of the first stage proceeding: here I would refer to the comments of Madam Justice Reed in Nguyen v. Canada (MCI) (1996), 122 F.T.R. 282 (F.C.T.D.) at 290. Second, to merely allow the subjects of the contempt proceeding to observe would not only be frustrating, but also wasteful of time and resources and contrary to natural justice in the sense of affording notice and a hearing, for it is also a principle of natural justice that no one be condemned unheard.
[14] Counsel for Penguin Boat submits that, in the face of the Order for preservation, the fact that the items ordered to be preserved no longer exist provides the required prima facie evidence. However, this approach overlooks the requirement that there be a deliberate, wilful or contumacious flouting or contempt of the Order, a requirement which has not been demonstrated by Penguin Boat, which has that obligation.
[15] The third point made by the counsel for Penguin Boat is that what evidence of destruction or loss of the preserved items was tendered was hearsay in the sense of being a letter from Western Stevedoring attached to an affidavit sworn on behalf of Egon Oldendorff. Certainly hearsay evidence, in substitution for the testimony of a local knowledgeable individual, would not be appropriate during the final stage of a contempt hearing. Indeed, in the present instance, I give only some minimal weight to the advice of Western Stevedoring, nor do I need to give it any weight at all, because it is for the party alleging contempt to do more than merely establish the order, knowledge of the order and a bare result. There must, as I have said, be prima facie evidence of a wilful and deliberate flouting of the Court order.
CONCLUSION
[16] What has occurred in this instance is, to say the least, very unfortunate. Penguin Boat, short of some other approach, will have to make do with the existing photographs, survey reports and some gear and remains which are still being preserved in California. To take the other approach, the issuance of an order requiring that New Resolution and Egon Oldendorff appear to hear proof of the contempt and to answer with any defence that they might have, would serve no purpose, for not only is there not a prima facie case of deliberate or wilful contumacious flouting or contempt of the Order, a conscious intention to disobey the Order, but also a finding of contempt would serve no purpose.
[17] There is finally the matter of costs. Certainly what occurred was serious and deserves recognition in some way. Indeed, one cannot fault Penguin Boat for bringing to the attention of the Court a very unfortunate situation. Had the preservation Order been effective, counsel for Penguin Boat would never have become involved in this excursion. Notwithstanding that Penguin Boat misjudged the strength of its case, this is an instance where it is appropriate to break with the usual practice that costs should follow the event and to exercise discretion, awarding no costs for or against any of the parties.
(Sgd.) "John A. Hargrave"
Prothonotary
Vancouver, British Columbia
16 June 2003
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-283-00
STYLE OF CAUSE: Goodman Yachts LLC v. Penguin Boat International Limited et al.
PLACE OF HEARING: Vancouver, British Columbia
DATE OF HEARING: 17 February 2003
REASONS FOR ORDER OF: Hargrave P.
DATED: 16 June 2003
APPEARANCES BY:
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Roger Watts
John W Bromley
H Peter Swanson
Nils E Daugulis
Vincent M Prager
|
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FOR PLAINTIFF
FOR DEFENDANTS Maritime Claims & Services Pte. Ltd. and Richard Howe
FOR DEFENDANT Egon Oldendorff
FOR DEFENDANT New Resolution Shipping Corp.
FOR DEFENDANTS Penguin Boat International Limited |
SOLICITORS ON THE RECORD:
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McEwen, Schmitt & Co. Barristers & Solicitors Vancouver, British Columbia
Bromley Chapelski Barristers & Solicitors Vancouver, British Columbia
Bernard & Partners Barristers & Solicitors Vancouver, British Columbia
Bull Housser & Tupper Barristers & Solicitors Vancouver, British Columbia
Stikeman Elliot Barristers & Solicitors Montréal, Québec |
|
FOR PLAINTIFF
FOR DEFENDANTS Maritime Claims & Services Pte. Ltd. and Richard Howe
FOR DEFENDANT Egon Oldendorff
FOR DEFENDANT New Resolution Shipping Corp.
FOR DEFENDANTS Penguin Boat International Limited |