Top 5 Civil Appeals From The Court Of Appeal – July 2018

1. Thunder Bay (City) v. Canadian National Railway Company, 2018 ONCA 517 (Laskin, MacPherson and Fairburn JJ.A.), June 11, 2018

   The bridge across the Kaministiquia River in Thunder Bay was open to railway, vehicle and pedestrian traffic for more than a hundred years. When the Canadian National Railway Company ("CN") closed the bridge to motor vehicles in 2013, the City of Thunder Bay brought an application for a determination of its rights under the 1906 agreement for the bridge's construction.

   The parties to the agreement were the Town of Fort William, now amalgamated into the appellant, the City of Thunder Bay, and the Grand Trunk Pacific Railway, now the respondent Canadian National Railway Company. Grand Trunk Pacific built the bridge, completing it in 1909.

   The bridge was a combined railway and roadway bridge, accessible to railway trains, cars, trucks, and pedestrians.

   In 2013, CN briefly closed the bridge because of a fire. When it reopened the bridge three days later, however, it reopened it only for railway trains and pedestrians, but not for motor vehicles. CN claimed that the bridge could not safely be reopened for motor vehicles because of the risk that an "errant" or wayward vehicle would leave the roadway, go across the sidewalk and into the river, despite the fact that for over a century, this had never occurred.

   Thunder Bay's application turned on two provisions of the agreement: section 3, in which Grand Trunk Pacific agreed to give Fort William "the perpetual right to cross the said bridge for street railway, vehicle and foot traffic", and section 5, in which CN agreed to "maintain the bridge in perpetuity". Thunder Bay took the position that CN was in breach of its contractual obligation to keep the bridge open perpetually for vehicles, while CN argued that it could not do so safely without making significant structural changes to the bridge, which were beyond its obligation to "maintain" it.

   The application judge found in favour of CN. He found: (i) that the parties intended that CN would maintain the bridge for the type of traffic that existed at the time the 1906 agreement was entered into, meaning streetcars, horse, and cart traffic, not motor vehicle traffic; (ii) that although CN had maintained the bridge for motor vehicle traffic, it consistently took the position that it had no contractual obligation to make structural changes necessary to keep motor vehicle traffic flowing; and (iii) that Thunder Bay had the onus to define clearly the relief it sought and the changes needed to make the bridge safe for motor vehicles, and it failed to do so.

   Thunder Bay appealed, arguing that the parties to the 1906 agreement intended that citizens would have the perpetual right to cross the bridge by any kind of vehicle and that, to enable them to do so, CN would have the obligation to maintain the bridge in perpetuity.

   The Court of Appeal agreed.

   Justice Laskin held that the application judge's finding on the parties' intent was unreasonable and tainted by extricable errors of law.

   Justice Laskin explained that the application judge's finding on the parties' intent was unreasonable because he failed to give proper effect to the words of the 1906 agreement or to the context in which the agreement was made. The application judge interpreted the words "vehicle traffic" and "vehicular traffic" narrowly to mean only that vehicle traffic which existed in 1906, namely streetcars, horses and carts. The full context in which the agreement was signed, however, supported the broad interpretation of vehicle traffic that includes the motorcar. Justice Laskin noted that the purpose of the agreement was to accommodate population growth, which would result in greater transportation needs. He found that the parties could reasonably be taken to have known in 1906 that automobiles would soon become the predominant mode of transportation.

   Justice Laskin held that the application judge also committed two extricable errors of law. First, he failed to give any effect to the words "perpetual" and "in perpetuity". The right to cross the bridge perpetually, and the corresponding obligation to maintain the bridge in perpetuity, can only mean that the parties intended the bridge to be open to any kind of vehicle, as the word "vehicle" is undefined. Second, the application judge erred in taking into account the subsequent conduct of the parties, though the meaning of the 1906 agreement was not ambiguous. If any relevant ambiguity existed in the meaning of the agreement, that ambiguity related not to the scope of CN's maintenance obligation, but to the meaning of "vehicle traffic". The subsequent conduct of the parties, however, especially that of CN itself in maintaining the safe operation of the bridge for the use of cars and trucks, resolved any ambiguity and supported the positon that vehicle traffic was meant to include motor vehicles.

   Justice Laskin held that the application judge made a further error of law in placing an onus on Thunder Bay to provide the court with a specific and detailed proposal to make the bridge safe for motor vehicles. CN had a contractual obligation to maintain the bridge for motor vehicles in perpetuity - an obligation which it breached. To rectify its breach, CN had to reopen the bridge. Accordingly, it had the onus to determine what maintenance was needed to alleviate any safety concerns associated with the bridge's reopening.

   In the result, the Court allowed the appeal, issuing a declaration that CN breached the 1906 agreement and ordering CN to reopen the bridge for motor vehicle traffic and maintain it in accordance with the agreement.

2. Davies v. Davies Smith...