The Discoverability Principle Applies—No Seriously, For Real This Time—to Contract Claims in Alberta

By: Kyle Gardiner

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Case Commented On: Weir-Jones Technical Services Incorporated v Purolator Courier Ltd, 2019 ABCA 49 (CanLII)

Last month, the Alberta Court of Appeal delivered its long-awaited decision in Weir-Jones Technical Services Incorporated v Purolator Courier Ltd, 2019 ABCA 49 (CanLII) (Weir-Jones). The decision has been much anticipated largely because it clarified the correct standard of proof for summary judgment applications in Alberta (a balance of probabilities). As a bonus, the decision also provided clarification on another topic in which confusing and contradictory lines of authority had emerged in Alberta: the question of whether the discoverability principle applies when determining limitation periods applicable to breaches of contract in Alberta. Does a plaintiff’s limitation period for a breach of contract claim commence when the breach occurred, or when the plaintiff ought to have discovered that it had a claim?

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Pharmacare…Long Overdue

By: Lorian Hardcastle

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Matter Commented On: Interim report from the Advisory Council on the Implementation of National Pharmacare

Canadian Medicare has traditionally focused on hospital and physician services due, in large part, to the fact that the Canada Health Act, RSC 1985, c C-6, provides for federal/provincial cost-sharing for these services. The exclusion of pharmaceuticals made sense at the inception of Medicare in the 1950s, as there were few effective drugs at the time. However, the ensuing decades have seen a proliferation of new drugs that significantly reduced morbidity and mortality. For example, statins, which lower cholesterol and decrease the risk of heart attack by approximately 25%, came into clinical use in the late 1980s. They are now taken by millions of Canadians and represent the second largest category of pharmaceutical spending (after certain types of cancer drugs). The increasing prevalence and efficacy of pharmaceuticals and their growing costs have led to calls for universal pharmaceutical insurance (referred to as pharmacare).

On Wednesday, the federally-appointed Advisory Council on the Implementation of National Pharmacare released their initial recommendations. Notably, they recommended that “Canadian residents have access to prescription drugs based on medical need, without financial or other barriers to access.” Universal pharmacare would make Canada’s health care system more equitable and prevent needless morbidity and mortality. It would also bring Canada in line with other countries. According to a recent report, “every developed country with a universal health care system provides universal coverage of prescription drugs—except Canada.”

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Opening a Can of Worms: What are the Applicable Market Rules for Generation Where the Generator Fails to Use the Entire Output?

By: Nigel Bankes

PDF Version: Opening a Can of Worms: What are the Applicable Market Rules for Generation Where the Generator Fails to Use the Entire Output?

Decision Commented On: EPCOR Water Services Inc., EL Smith Solar Power Plant, February 20, 2019, Decision 23418-D01-2019

This decision raises important questions as to the applicable rules for self-generation where the generator seeks to export any surplus to the grid. The decision deserves to be read by all those engaged in self-generation beyond the micro and small levels, including self-generation that benefits from designation as an industrial system.

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Administrative Segregation and the Charter of Rights and Freedoms

By: Myrna El Fakhry Tuttle

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Case Commented On: R v Prystay, 2019 ABQB 8 (CanLII)

On January 4, 2019, Madam Justice Dawn Pentelechuk found that Mr. Ryan Prystay’s lengthy stay in administrative segregation at the Edmonton Remand Centre breached section 12 of the Charter. Consequently, she granted him enhanced credit of 3.75 days for each day spent in administrative segregation.

Administrative segregation is used in remand centres to keep an inmate away from the general population for safety or security reasons. It is not intended to be used as a punishment and can be indefinite, while disciplinary segregation is imposed as a penalty and has to be for a specified period of time.

Unlike in disciplinary segregation, inmates in administrative segregation have the same rights and privileges as other inmates, however, the operational reality is that one’s experience in either form of segregation is drastically different from that of inmates in the general population (at para 27). Inmates in either form of segregation are kept in a cell alone for 23 hours a day. They have two half-hour blocks outside of their cell during each 24 hour period where they can shower, exercise, watch television or use the phone in the “fresh air” room. Inmates stay alone during those activities. Administrative segregation inmates may have visits via CCTV (closed circuit television) (at paras 28-29).

On October 16, 2018, the Honourable Ralph Goodale, Minister of Public Safety and Emergency Preparedness, introduced in the House of Commons Bill C-83, An Act to amend the Corrections and Conditional Release Act and another Act. The purpose of the bill is to strengthen the federal correctional system in a number of ways including ending administrative segregation and disciplinary segregation and creating “structured intervention units.”

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Lessons from Redwater: Discard the AbitibiBowater Test and Legislate Super Priority for the Regulator

By: Jassmine Girgis

PDF Version: Lessons from Redwater: Discard the AbitibiBowater Test and Legislate Super Priority for the Regulator

Case Commented On: Orphan Well Association v Grant Thornton Ltd, 2019 SCC 5 (CanLII)

Environmental cleanup costs are a natural consequence of operating in the oil and gas industry. Provincial regulations ensure these costs are borne by the company responsible for them, and these regulations work if that company is solvent. An insolvent company, however, cannot bear the costs of outstanding environmental orders, which leaves those costs to the company’s creditors or to the public.

The goal should be, and fairness dictates, that the debtor always covers the cost, regardless of its solvency, but that requires amending the governing legislation, preferably to give the regulator (in this case, the Alberta Energy Regulator (Regulator), and the equivalent regulators in other provinces) a super priority. Knowing the Regulator has a super priority in a bankruptcy will compel the adjusting creditors to modify their agreements ex ante, ensuring, in turn, that companies comply with regulations and have enough capital to cover environmental costs as they arise. This solution is better than our current system, in which creditors must wait for a court to apply the three-part test from Newfoundland and Labrador v AbitibiBowater Inc, 2012 SCC 67 (CanLII) (AbitibiBowater test) to determine who has priority, potentially leaving them to deal with the consequences ex post.

On a matter this important and this costly, a matter that has notable public policy considerations and far-reaching implications for private parties, both sufficient environmental protection as well as certainty in adherence to the legislated priorities, must be the ultimate goals. The Bankruptcy and Insolvency Act, RSC 1985, c B-3 (“BIA”) does not currently provide enough environmental protection, which may compel courts to compensate through the AbitibiBowater test. It is hard to predict the outcome of the test and, depending on its application to a given set of facts, it undermines the BIA priority scheme. Throughout the proceedings of Orphan Well Association v Grant Thornton Ltd, 2019 SCC 5 (CanLII) (commonly known as the Redwater case), in three levels of court, there were five judgments. Eleven judges applied the same test and six of them ruled in favour of the Regulator, while five ruled in favor of the secured creditor. This much disagreement over one set of facts should indicate that these issues should not be handled by the courts through the application of the AbitibiBowater test. The required certainty in this area must come from Parliament by way of legislative amendment to clarify a super priority charge in favour of the Regulator in the BIA.

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