This week on Legally Speaking with Michael Mulligan:
For some legal purposes, corporations are treated like people: they can enter into contracts, own property, engage in litigation, and be charged with committing offences.
Some constitutional protections also apply to corporations: the right to be free from “unreasonable search and seizure” and the right to a trial within a reasonable period of time for example.
Other constitutional protections don’t apply to corporations including the right to “life, liberty and security of the person” or the right not to be forced to testify that is protected by section 11 (c) of the Charter.
In a recent case from Quebec, where a small corporation was subjected to a fine of more than $30,000 for performing construction work without a licence, the Supreme Court of Canada has now decided that corporations can’t benefit from the constitutional protection against “any cruel and unusual treatment or punishment.”
You can’t be cruel to a corporation.
The next case discussed involved an application for an annulment of a marriage.
Following the marriage ceremony, the bride and groom attended a park, along with family members, for the purpose of photographs. A huge argument ensued, and the bride decided she didn’t want to be married.
Both parties applied for the annulment and pointed out that the marriage hadn’t been consummated following the marriage ceremony.
In refusing the application, the judge pointed out that not consummating a marriage is an insufficient basis for an annulment. There needs to be evidence that the parties were incapable of consummating the marriage, not simply that they had not done so.
Also discussed is an ongoing case that represents the largest loss that ICBC has ever suffered when hundreds of cars were damaged by acid that leaked onto a highway near Trail BC.
ICBC is suing everyone possible in an effort to recover the money they paid out for the damaged vehicles including the company that made the acid, the company that transported it, and the company that purchased it. Notably, ICBC is even suing the Province of British Columbia alleging the Ministry of Transportation or the Ministry of the Environment was partially to blame.
The issue that was just decided by a judge involved the ongoing storage of the vehicles involved. ICBC has already incurred $1.6 million in storage costs keeping the vehicles at a private storage facility. As they are paying $54,734 per month to continue storing the vehicles there, ICBC wanted permission to dispose of the vehicles prior to the trial.
The judge refused ICBC’s application and ordered the vehicles to be kept until March 31, 2021, so as to permit time for the defendants to inspect the vehicles.
According to the judge, ICBC decided to “write off” any vehicle found to have “any visible signs of exposure” to sulfuric acid.
The defendants are taking issue with whether all of the vehicles should have been written off on this basis.
If, as has been proposed, a no-fault car insurance system is adopted in British Columbia, ICBC would not be able to sue anyone to recover money from anyone in a case like this, even if it could show that they were careless.
Automated transcript of the episode:
Legally Speaking Nov 5, 2020
Adam Stirling [00:00:00] It’s time for our regular segment, where we check in with Michael Mulligan Barrister and Solicitor with Mulligan Defence Lawyers, Legally Speaking, on CFAX 1070. Michael, good morning. How are you?
Michael T. Mulligan [00:00:09] Good morning. Great to be here. I can’t complain at all.
Adam Stirling [00:00:12] One of the legal concepts that I’ve always found fascinating is the idea that a corporation can be in some respects a person, the idea of corporate personhood and what rights that legal entity, that really only exists as an idea, should and should not enjoy. An interesting ruling from the Supreme Court of Canada today with respect to cruel and unusual punishment.
Michael T. Mulligan [00:00:36] Yes, indeed. So, you’re quite right. A corporation, for many purposes, is treated as a legal person, like a corporation could, for example, enter into a contract, right. If you’re agreeing to buy a piece of electronics from some big company, you’re not contracting with the, you know, president of the company, you’re contracting with the company.
Adam Stirling [00:00:59] Yes, yes.
Michael T. Mulligan [00:00:59] Companies can enter into contracts. They can own property. You can sue them. They can be sued. Right. So, they have a legal existence, which in some respects is like what a person could do carrying out those things. But when you get around the margins, how far does that actually extend? And the case that just came out from the Supreme Court of Canada originated in Quebec and the fact pattern was that a small corporation there apparently did some construction work without a license. They’re quite strict about that, it would seem. In Quebec, the Quebec Building Act sets out a minimum fine as a punishment for a corporation that engages in construction work without the required license. And so, in this case, this little corporation was fined something north of $30,000 and the corporation made the argument, hey, this is cruel and unusual punishment. Contrary to Section 12 of the charter, which prohibits somebody from being subject to punishment, which would be cruel and unusual treatment or punishment. And so there were differing views by different judges in Quebec as the thing sort of wound its way through the system about whether that particular protection, the constitutional protection to be free from cruel and unusual treatment or punishment, does that protection apply to a corporation? Because some charter rights do apply to a corporation, but others don’t. So, for example, the Section 8 protection against unreasonable search and seizure does apply to a corporation, right? You need a search warrant before you can if you’re the police kicked the door down of a company and rummage around for records, for example.
Adam Stirling [00:02:48] Indeed. And that’s the way it should be.
Michael T. Mulligan [00:02:50] Right. So that that right, unreasonable search and seizure does apply to a corporation. Right. Some of the rights have been found to apply to a corporation, including the right to have a trial within a reasonable period of time. Right, if you charge a corporate entity with some offence, you have to have the trial within a reasonable period of time. You can’t just drag your feet endlessly so that right applies to a corporation as well. However, other ones, there’s a constitutional right under Section 7 to life, liberty, and security of the person.
Adam Stirling [00:03:22] Yes,.
Michael T. Mulligan [00:03:22] That does not apply to corporations. So, some charter rights do, some don’t. And so, this case had to decide, do corporations enjoy that protection to be free from cruel and unusual treatment or punishment? And we have an answer to that today. And the answer is no.
Adam Stirling [00:03:42] OK,.
Michael T. Mulligan [00:03:43] Yeah, you can be as cruel as you like to a corporation. And part of that was the Supreme Court of Canada analyzing what’s really being talked about using that language, cruel and unusual treatment, or punishment. And there was certainly focus on that concept of cruelness and the idea that, look, you can’t be cruel to a legal entity. It’s not a human being. It’s not a person. And the court focused on things like, you know, what’s the purpose of the Section 12 of the charter? And it’s an important section that’s actually gotten a fair bit of use lately because under the conservative, previous conservative government federally, they created a whole number of mandatory minimum sentences.
Adam Stirling [00:04:32] Yes.
Michael T. Mulligan [00:04:33] And the challenge with those, of course, is when you come up with the idea of a mandatory minimum sentence for something that sounds like some terrible crime, everyone pictures some, you know, ogrish person that we need to protect ourselves from; but human affairs are endlessly complicated, right?
Adam Stirling [00:04:49] Yes.
Michael T. Mulligan [00:04:50] And inevitably, with many of those things, you wind up capturing people that had nowhere near the level of moral culpability that we would have had in mind when you think, you know, is that a good idea to have a mandatory minimum punishment for this great, you just wind up capturing people, you’re like, oh my goodness, we didn’t mean the single mother who, you know, had the whatever, you know, handgun in her drawer that was left by her, you know, grandfather or something. That’s not what we meant by, you know, having a loaded handgun, for example. Right. I remember in Victoria a number of years ago, there were mandatory minimum penalties in place at the time and there’s still some involving things like possessing a loaded handgun. Or one that is readily accessible ammunition and I recall watching this fellow come into courtroom 101 that remand court and he was a World War Two veteran.
Adam Stirling [00:05:45] Yes.
Michael T. Mulligan [00:05:45] Coming in with a cane and medals all over. He came in with his jacket and medals displayed. And what he had was a Luger.
Adam Stirling [00:05:53] He was going to say is the Lugar case. Yeah,.
Michael T. Mulligan [00:05:56] Right. And so, nobody had that in mind. Right.
Adam Stirling [00:05:59] No
Michael T. Mulligan [00:05:59] When you sort of you picture some gang member that you have to stop, you don’t picture. We’re going to send the 89-year-old World War Two veteran to some mandatory minimum jail sentence over the Luger he took from the German officer during the Second World War. That’s just not what we envisioned. So, this section of the charter is cruel and unusual treatment of punishment has been used quite frequently when the court has been dealing with, you know, are these various mandatory minimum penalties permissible?
Adam Stirling [00:06:32] Yes.
Michael T. Mulligan [00:06:33] And many of them sort of one after the next, once they get examined, have been found to be unconstitutional. There’s a broad trend in that regard and a good one, I must say. The other practical problem with mandatory minimum penalties is that they produce things like completely unnecessary trials where cases otherwise could have resolved. You know, if somebody is acting for the you know, for example, the military veteran that I’ve just described.
Adam Stirling [00:07:00] Yes.
Michael T. Mulligan [00:07:00] If you’re facing a mandatory two-year prison sentence, well,.
Adam Stirling [00:07:03] You have to that you have to fight that.
Michael T. Mulligan [00:07:06] You have to fight that because that’s just an outrageous outcome and so the thing just goes to trial, when otherwise everyone might agree well, we should probably take the bullets away. You make the gun safe or something and, you know, carry on. But so, they have that adverse effect as well. So, the section’s been used a lot lately. But the Supreme Court of Canada, in analyzing the section, found that, you know, the purpose of that is to deal with concepts like, you know, human dignity.
Adam Stirling [00:07:33] Yes,.
Michael T. Mulligan [00:07:33] Sort of. You know, how it’s an indignity to, you know, impose cruel punishment on somebody that’s completely excessive. And all of the judges, although they give the competing sets of reasons, concluded that that concept just doesn’t get purchased with a legal entity like a corporation. You just can’t be cruel to a legal entity. However, we do it, we do attach other protections like, you know, you’ve got to get the trial on in a reasonable time and no, you just can’t kick the door in of any company and rummage around in their, rummage around in his records or something without getting a warrant. So, we’ve got some clarity there. And you can feel free to be as cruel as you like to a corporation. Just make sure you’ve got that search warrant and get the trial out of time.
Adam Stirling [00:08:23] I was going to say, because if you commit a tort against them, they’re corporate litigators will probably be serving you in short order.
Michael T. Mulligan [00:08:29] Indeed,.
Adam Stirling [00:08:31] An unsuccessful application for an annulment in our next case.
Michael T. Mulligan [00:08:35] Yes, indeed. So, we are actually a few weeks ago talked about a case where there was a successful application for an annulment, where the couple was unable to, despite many efforts, consummate the marriage. Maybe the couple in this case thought, oh, this looks like a good, good way to go. The fact pattern was this couple had a marriage ceremony and then they and their family went to a park to take wedding photographs.
Adam Stirling [00:09:02] Yes.
Michael T. Mulligan [00:09:03] And apparently an enormous argument broke out at the park between family members. And the recently married bride said that she did not wish for the marriage to continue and left.
Adam Stirling [00:09:17] Oh, no. (indiscernible) oh family law.
Michael T. Mulligan [00:09:20] That’s right. So, the that was the end of the marriage. And so, this former couple applied for what’s called a desk order. And a desk order is an application to a to a judge for some remedy that the judge is permitted to grant. Typically, where there really isn’t, the parties are really in agreement here, both of these people that was the end of the marriage. They both applied for an annulment.
Adam Stirling [00:09:49] I just said, how could they both decide that’s the end of the marriage? Oh, we are married isn’t this great. Let’s go take some pictures of the park. oh, an argue, OK, maybe we aren’t married anymore.
Michael T. Mulligan [00:09:56] And that’s the end of it.
Adam Stirling [00:09:58] Ahh(sigh)
Michael T. Mulligan [00:10:00] So they asked for this thing.
Adam Stirling [00:10:02] Yeah,.
Michael T. Mulligan [00:10:03] And their reason for asking for it or one of their justifications for asking for it was something that the judge spoke about as being sort of a common misconception. And the misconception is this, the fact that you haven’t consummated a marriage, doesn’t, is not sufficient to get an annulment.
Adam Stirling [00:10:24] Hmm.
Michael T. Mulligan [00:10:25] There has to be more than that. And the more than that would require not simply evidence that, you know, they hadn’t consummated the marriage since the ceremony that was common ground both of these people agreed that that hadn’t happened on the way to the park. But in order to get an annulment, there needs to be evidence that they were incapable of doing so, not simply that they had not done so since the marriage ceremony took place and because there was no evidence that they were incapable of consummating it, simply that they had not consummated it before the enormous argument broke out at the park, the judge concluded that there is no basis for an annulment and there is a presumption that there is a valid marriage unless there is some evidence that one of the requirements for a marriage hasn’t been met. And there just wasn’t evidence from either of them that there hadn’t been so. It was simply we had the ceremony, we went to the park, we had the argument, we hadn’t consummated it and so we both want an annulment. It’s over. And they did not get one.
Adam Stirling [00:11:35] hmm.
Michael T. Mulligan [00:11:35] And so, you know, the moral of the story is it doesn’t take much and there’s a strong presumption you are married. Interestingly, it caused me to look at that reference in the decision about the fact that they had, the judge said, the evidence was that the, they had complied with the formal requirements of the Marriage Act. That’s an interesting thing.
Adam Stirling [00:11:55] Yeah.
Michael T. Mulligan [00:11:55] Caused me to have a look at. You know, what kind of things might you get wrong to not comply with the formal requirements of the Marriage Act?
Adam Stirling [00:12:02] Yeah.
Michael T. Mulligan [00:12:02] One of the interesting ones here that struck me was Section 35 of the Marriage Act in British Columbia. That section actually creates an offence for somebody to issue a marriage license or to perform a marriage where the person, one of the individuals is impaired by drugs or alcohol.
Adam Stirling [00:12:23] Interesting.
Michael T. Mulligan [00:12:25] Or is there some other mental incapacity to do it. So when I saw Section 35, it caused me to think you’d better not have too much to drink before that marriage ceremony, lest you put everyone at risk of committing an offence who’s engaged in that process.
Adam Stirling [00:12:40] By law, it says that they’re liable for on conviction of a penalty if not more than $500.
Michael T. Mulligan [00:12:45] So yes, indeed. And probably that’s not making it to the cruel and unusual level.
Adam Stirling [00:12:51] No No.
Michael T. Mulligan [00:12:51] If you’re married, if you marry the drunken person, you might be on the hook for $500 bucks. But…
Adam Stirling [00:12:57] All right, let’s take our first break, Legally Speaking, with Michael Mulligan from Mulligan Defence Lawyers. We’ll continue in just a moment on CFAX.
Adam Stirling [00:13:05] Back to Legally Speaking on CFAX 1070, joined as always with Michael Mulligan from Mulligan Defence Lawyers, the ongoing saga, Michael, about which you and I have spoken a few times now, ICBC storing a number of vehicles damaged by acid, more than 500, if my recollection is accurate.
Michael T. Mulligan [00:13:22] Yeah, that’s exactly right. I think this this case may represent the largest loss ever suffered by ICBC.
Adam Stirling [00:13:31] Wow.
Michael T. Mulligan [00:13:31] And the fact pattern involved a spill of acid allegedly on two different occasions, but a month apart, hard to know that how that could have occurred. And essentially there was acid produced by one company, sold to another company, transported by a third company, and allegedly not well or sufficiently secured, the stuff splashed out or leaked out of the truck as it was being driven near Trail in British Columbia and hundreds of vehicles drove through the acid, causing, well, one what one might expect damage.
Adam Stirling [00:14:06] Yes.
Michael T. Mulligan [00:14:07] And the ICBC wrote off, in excess, of 500 of those vehicles and ICBC is now going about suing all manner of people, trying to recover the massive amounts that are paid out for all of these acid damaged vehicles.
Adam Stirling [00:14:29] Yes,.
Michael T. Mulligan [00:14:30] They’re suing the company to meet the acid, the company that bought the acid, the company that transported the acid, the two guys that drove the truck. Also, interestingly, ICBC is suing. This is a bit of a head scratcher the province of British Columbia.
Adam Stirling [00:14:47] Aren’t they owned by the province.
Michael T. Mulligan [00:14:47] Yes, indeed.
Adam Stirling [00:14:47] OK,.
Michael T. Mulligan [00:14:48] They appear to be suing their own tail or so they’re suing the province of British Columbia, claiming that the Ministry of Transportation didn’t do enough to prevent this.
Adam Stirling [00:14:57] Interesting.
Michael T. Mulligan [00:14:58] But they’re also suing the city of Trail claiming they didn’t do enough, so they’re suing everyone in sight, trying to recover for this loss. Interestingly, we’ve talked about before, if we were in the time of no fault if that precedes, none of this lawsuit would not occur. This would simply be well, stuff happens, you know, acid leaks, ICBC would pay out and they would have no opportunity to recover anything from anyone. It would be no fault. Right.
Adam Stirling [00:15:27] Yes.
Michael T. Mulligan [00:15:28] Oh well, cars got damaged, fix the cars that would be the end of it. But we’re not there at this point. And so, the particular decision that just came out arises over whether these vehicles should continue to be stored. And it’s not an insignificant expense. ICBC has so little unclear. It’s being stored at a private lot, and ICBC has so far paid 1.6 million dollars in storage costs.
Adam Stirling [00:15:56] Wow.
Michael T. Mulligan [00:15:56] And they’re incurring an additional $54,734 per month to continue storing all of these acid damaged vehicles in this private lot. And the reason they’re being stored is that the companies and people that ICBC, the province, for that matter, who ICBC are suing, are claiming that, hey, these things weren’t damaged in the way that ICBC claims should not have been written off and we haven’t had a chance to inspect them yet in order to defend ourselves.
Adam Stirling [00:16:31] Interesting.
Michael T. Mulligan [00:16:32] And this is the description of what ICBC did to decide whether these vehicles were right offs. Apparently, according to the judge, adjusters were instructed to, quote, write off any vehicle they found to have, quote, any visible sign of exposure, close quote, to sulphuric acid. And so, you know, what is that?
Adam Stirling [00:16:55] Any visible sign? Like, there’s no reasonable there’s no significant or substantial is any visible sign?
Michael T. Mulligan [00:17:01] Any visible sign of exposure.
Adam Stirling [00:17:02] Wow.
Michael T. Mulligan [00:17:02] To write them off.
Adam Stirling [00:17:04] Huh.
Michael T. Mulligan [00:17:05] And they had apparently ICBC people going around with some engineers using PH strips to determine whether something might have acid on it. And if there is any visible, any visible…
Adam Stirling [00:17:18] Wow.
Michael T. Mulligan [00:17:18] …exposure, they would right the vehicle off.
Adam Stirling [00:17:20] That’s very broad language, isn’t it?
Michael T. Mulligan [00:17:22] It’s really broad. And they claimed, well, you know, this could affect some safety system. Maybe it could be on the brake line, but any visual exposure, right off. And so all of these entities that are being sued for millions and millions of dollars from the, you know, guy that drove the truck to the Province of British Columbia, to the city of Trail, to the company that bought, made, or transported the acid, are all saying, well, hold on, that doesn’t seem right. And moreover, there’s been sort of a long and unfortunate history of them trying to get access to these vehicles to make their own assessment as to whether they should have been written off or not. And that’s been for a variety of reasons, including snow and logistics and all kinds of things, hasn’t occurred. And the case also dealt with the concept of spoliation, which is an interesting thing. Spoliation would be the concept that, you know, if you’re involved in litigation with somebody over a particular thing and you intentionally destroy evidence relating to the case, there could be an adverse inference drawn about what that evidence might have shown.
Adam Stirling [00:18:28] Yes.
Michael T. Mulligan [00:18:28] Right. You know, if I’m claiming that, you know, you did something fraudulent and I take the very documents that I’m claiming were fraudulent and I burned them.
Adam Stirling [00:18:37] Yes.
Michael T. Mulligan [00:18:38] Before the trial. Well, you might not unreasonably think maybe those didn’t quite show what you were claiming. Right. And so ICBC was saying, well, we shouldn’t have to store these things. We should be allowed to destroy them, and you shouldn’t draw some adverse inference by virtue of the fact that we’ve done that. Anyways, the judge had none of it and has ordered ICBC to keep storing the vehicles until next year, March of 2021, to allow time for them to be inspected. And they were not, the judge was not prepared to say that ICBC would be relieved from the possible finding that they engaged in spoliation if they go and destroy the cars before the trial.
Adam Stirling [00:19:22] Interesting.
Michael T. Mulligan [00:19:22] Also, interestingly, if I read it, the other thing caused me to smile is one of the vehicles apparently has been described, inadvertently crushed. Not quite sure how that happened.
Adam Stirling [00:19:30] Whoops.
Michael T. Mulligan [00:19:30] Whoops, that might be a problem. So, there it is. We’ve got ongoing litigation and ICBC is going to continue paying fifty something thousand dollars a month to keep storing these hundreds of vehicles as they attempt to recover money from various people, including the Province of British Columbia.
Adam Stirling [00:19:51] …got to keep the economy going somehow. We have three minutes left if we want to touch on the ongoing matter involving Meng Wanzhou.
Michael T. Mulligan [00:19:59] Yeah, I think we can so that case involving the extradition application is continuing to roll on and one of the most recent decisions on it, dealt with the application that she’s making for a stay of the extradition based on an allegation of there being an abuse of process. And the particular key, the particular decision involved whether that application should be allowed to proceed or not. The government was arguing that it had no chance of success and shouldn’t be allowed to go ahead. The judge analyzed all of what was being asked for in a way, and concluded that that application could, in fact, proceed. But the really interesting takeaway, I think, in reading the decision is the fact that we are so fortunate to live in a place where this kind of analysis goes on.
Adam Stirling [00:20:54] Yes,.
Michael T. Mulligan [00:20:55] You can read exactly why this has been made, what the evidence is, exactly what the argument is, is about. You’ve got an independent judge rejecting what the government was asking for, and we’re going to get a reasoned, transparent, open decision about it.
Adam Stirling [00:21:10] Yes,.
Michael T. Mulligan [00:21:11] And it isn’t just such stark contrast with, for example, what’s going on in China.
Adam Stirling [00:21:16] Yes,.
Michael T. Mulligan [00:21:17] China, of course, took two Canadians essentially hostage. There’s been no trial. There’s been no reasons like this, no independent assessment of it. And just when you, each time I read one of the decisions or reports about how the extradition process is being handled in Canada, it should be all of us just so very proud to live in a country where this is how we handle things according to the rule of law, with an independent judge, with decisions that are available for anyone to look at and assess for themselves.
Adam Stirling [00:21:49] Yes.
Michael T. Mulligan [00:21:50] And that is just not the norm. And this case just could not provide a clearer contrast between what happens to you when the government of China decides to just pick you up and put you in a jail cell and what happens in Canada. And so, I think that’s really the point of it. And it’s just so great to see that that’s how we handle things. And it is just such a sharp contrast with how..
Adam Stirling [00:22:15] yeah.
Michael T. Mulligan [00:22:16] ..You are treated in most parts of the world.
Adam Stirling [00:22:17] Indeed, I had a lawyer and weaker human rights advocate tell me once that in some areas of China, in the camps where the weaker are being re-educated, they’re actually arrested daily by algorithm.
Michael T. Mulligan [00:22:28] Right.
Adam Stirling [00:22:28] The police have a computer printout a list of names. They don’t know why. They don’t know what they did. They are just they’re told to go pick them up, take them to the camp. A machine makes decisions like that very, very disturbing. So, I’m glad we have the system we do.
Michael T. Mulligan [00:22:39] Yes. We are very fortunate.
Adam Stirling [00:22:40] Michael Mulligan, Legally Speaking, every week here on CFAX 1070. Thank you for the benefit of your knowledge and insight, as always, Michael, until next week.
Michael T. Mulligan [00:22:47] Always a pleasure, Stay safe. Thank you so much.
Adam Stirling [00:22:49] Bye now.
Automatically Transcribed on November 5, 2020 – MULLIGAN DEFENCE LAWYERS