Torts are non-contractual civil wrongs. They include negligence, trespass, defamation (libel and slander), and interference with contractual relations, to name a few categories of torts. The law of torts consists mainly of common law. The sources of common law are judicial decisions (“case law”) rather than legislation.

The problem the report addresses is that when tort claims are made against corporations,  the directors and officers are often sued as well even when the grounds for suing them personally are extremely weak or nonexistent. The unsettled state of the law encourages this. In a 2024 case, one Alberta judge summed up the issue by saying that “The Canadian law concerning the liability of corporate agents in tort has been a mess for at least a quarter century.”

Few tort claims against directors and officers actually succeed, but they are made anyway to create pressure for settlement by putting the personal assets of the individuals at risk. Judges have criticized this tendency, but seldom strike out claims against personal defendants in corporate litigation at a preliminary stage because the legal standard for taking that drastic step is very high. The claims against the personal defendants are usually allowed to proceed, allowing the risk exposure to the personal defendants to be used as leverage to force a settlement as the lawsuit continues.

Sometimes directors and officers are sued personally for purely “deep pockets” reasons, meaning they are sued as additional parties in an attempt to widen the scope of liability so collection will be possible from some source if the corporation is insolvent and unable to pay it.

These practices do not promote business efficiency, because boards and senior managers need to be able to make decisions in the interest of their organizations without constantly looking over their shoulders to avoid being sued personally. In addition, the cost of directors’ and officers’ (“D and O”) liability insurance is driven up because the insurance providers have to defend claims against insured corporate insiders whether the claims have merit or not

There are two diverging lines of case law regarding when directors and officers are personally liable for torts committed by their corporations. Each derives from a different decision of the Ontario Court of Appeal. The two Ontario Court of Appeal decisions are ScotiaMcLeod Inc. v. Peoples Jewellers Ltd. (“ScotiaMcLeod”) and ADGA Systems International Ltd v. Valcom Ltd. (“ADGA Systems”).

ScotiaMcleod has been treated in later cases following it as holding that directors and officers aren’t personally liable for corporate wrongs if they’ve acted honestly and in the best interests of the corporation. Under the ScotiaMcLeod line of cases, personal liability is largely restricted to cases where directors or officers have acted in bad faith, stepped outside their roles as directors or officers and pursued their own or other private interests, or otherwise haven’t acted in the best interests of the corporation. The ADGA Systems line of cases holds that directors and officers are personally liable in tort for what they do in their corporate roles even if they are acting in the interests of the corporation.

BCLI’s Project Committee didn’t find either of the two principal lines of case law in Canada satisfactory, and so didn’t choose between them. The project committee didn’t find a satisfactory approach to borrow from in other major common law systems either. Research showed that courts in the United Kingdom, the USA, Australia, and New Zealand have also struggled to determine when directors or officers ought to share in the liability of the corporation and when not.

The members of the BCLI Project Committee decided to chart their own course in seeking a solution. They came up with nine recommendations that its members think courts in the common law provinces and territories of Canada should apply when deciding cases involving personal claims against directors and officers based on tortious wrongs of the corporation. The nine recommendations are grounded in existing tort and corporate law principles. They are also carefully crafted to balance on one hand the reality of decision-making involved in running a corporation or a not-for-profit organization, and fairness to tort victims on the other.

Taken as a group, the nine recommendations in the Report on Non-Statutory Liability of Directors and Officers would provide a way out of the weeds of the contradictory fallout from ScotiaMcLeod  and AGDA Systems, provide reasonable protection to directors and officers, and help to keep D&O insurance premiums down.

The post BCLI issues report curbing unnecessary litigation risk for directors and officers first appeared on British Columbia Law Institute.

Mr. Jack the Senior (“Mr. Jack”) made a will in 2006 and died in 2018. His will called for the residue of his estate to be divided equally among “my children then alive.”  A term in a will that says what is to happen with the residue of the estate is called a “residuary clause.” Residue is the portion of an estate left over after all debts, funeral expenses, and other expenses are paid and specific property that the will gives to particular beneficiaries has been distributed to those beneficiaries.

Mr. Jack had two sons we’ll refer to by their initials T and J. In his will he appointed T as his executor. The will had usual wording giving the executor power to sell or retain particular assets in the same form as they were at the will-maker’s death and also gave the executor discretion regarding the timing of any sale. The largest asset in Mr. Jack’s estate was a ranch which the two sons ran together.

The gift to Mr. Jack’s children under the residuary clause in his will was a “class gift,” meaning that the beneficiaries are identified by means of a description of a class of persons to rather than being identified individually. Sometimes post-mortem disputes can arise about when the class of beneficiaries was meant to close, or in other words about the size of the class.

The will provided for the possibility that Mr. Jack might have more children, because . another term in it said that if anyone became entitled to a share of the estate while under 19, the share would be held in trust by the executor until that person reached 19 years of age.

Both Mr. Jack’s sons survived him, but J died before the estate was distributed. J had a spouse but no children. J’s and T’s mother, Mr. Jack’s ex-wife, became the administrator of J’s estate with the consent of J’s spouse. The only asset with significant value in J’s estate was his interest in the ranch.

T claimed all of the residue of Mr. Jack’s estate, including the ranch, maintaining that “my children then alive” in the residuary clause in the will meant the children of Mr. Jack who were alive when the residue was distributed. That would mean T would get it all.

T’s and J’s mother, acting as J’s administrator, sued T for a declaration that on the proper interpretation of the will, “my children then alive” meant Mr. Jack’s children alive at the time of his death. That would mean that T and J’s estate shared equally in the ranch along with the rest of the residue. So T and his (and J’s) mother faced off in court over who was right about what the will meant.

The first court to deal with the case was the BC Supreme Court, which is not the highest court in BC but is actually BC’s superior trial court. The BC Supreme Court judge considered the will to be unambiguous, and interpreted it to mean that the executor was to gather the assets, pay the estate’s debts, and then divide the residue into equal shares based on the number of Mr. Jack’s children “then alive.” In other words, alive when distribution of the residue took place. The judge also thought the words “then alive” had been included order to override the usual rule that the terms of a will take effect at the will-maker’s death.

In other words, T won in the BC Supreme Court and would have taken everything, including the ranch. Except that his mother appealed to the BC Court of Appeal, which is BC’s highest court.

The Court of Appeal held the first court’s interpretation was wrong. It said the first court should have applied what is known as the “presumption of early vesting.”  This is a rule of interpretation that beneficiaries become entitled to receive what the will gives them at the time of the will-maker’s death unless the terms of the will show a clear intention by the will-maker to override the rule, or the gift depends on some fact personal to the beneficiary, like reaching a certain age. The Court of Appeal did not consider the words used in the Jack will were clear enough to override the rule, and considered it unlikely that Mr. Jack had intended to postpone his surviving children from becoming entitled to their shares of the residue until the rest of the estate had been fully administered.

The presumption of early vesting applies to class gifts as well as other gifts under a will. If it is possible to determine the size of the class at the death of the will-maker, that is generally when the class is considered to close. The Court of Appeal declared the class under the residuary clause in the Jack will closed on the death of Mr. Jack, reversed the first court’s decision, and declared J’s estate to be entitled to a half-interest in the residue.

T would have to share the ranch (and any other residue) after all with his mother representing his deceased brother’s estate. So ended the Jack family’s internal class war.

The BC Court of Appeal decision in Lewis v Jack, 2026 BCCA 18 was handed down on 21 January 2026.

The post Family-size Class Warfare – Who Gets the Ranch? first appeared on British Columbia Law Institute.

The parties have a longstanding relationship and worked together to develop the functioning of the App with Kilter’s climbing boards. The exact nature of their respective involvement is disputed. For a number of years, Aurora supplied Kilter with LED Kits without any difficulty; however, when Aurora decided to update its terms and conditions relating to the purchase of the LED Kits, the relationship between the parties soured and Kilter eventually sued Aurora in Colorado.

This dispute eventually led to this litigation in the BC Supreme Court, in which “Aurora seeks an injunction restraining Kilter from breaching the terms of the April 2024 agreement [that partially settled some of the parties’ claims]. Aurora seeks that Kilter be restrained from manufacturing, sourcing, supplying and/or selling LED kits not made by Aurora. Aurora also seeks to restrain Kilter from developing a mobile application using similar ideas, features or functions as the App”.

The court began by setting out the legal principles that govern applications for pre-trial injunctions: “the applicant seeking a pre-trial injunction must demonstrate each of the following: (a)  there exists a serious issue to be tried; (b)  they will suffer irreparable harm if the injunctive relief is not granted; and (c)  the “balance of convenience” favours granting the injunction sought. RJR—MacDonald Inc. v. Canada (Attorney General), 1994 CanLII 117 (SCC), [1994] 1 SCR 311”.

In addition, the court made the following general points:

[77]      Rigid compartmentalization of the factors should be avoided. The factors serve as evidentiary considerations relative to the central question of whether the relative risks of harm to the parties favour the granting or withholding of interlocutory relief: Edward Jones v. Voldeng, 2012 BCCA 295 at paras. 19 and 24.

[78]      The objective of the court at this stage is not to determine the merits of the action, but rather whether the granting of an injunction is just and equitable in all of the circumstances of the case: Google Inc. v. Equustek Solutions Inc., 2017 SCC 34 at para. 1; Vancouver Aquarium Marine Science Centre v. Charbonneau, 2017 BCCA 395 at para. 37.

The court found that “Aurora’s breach of contract claim surpasses the requisite threshold. The claim is neither frivolous nor vexatious”.

But Aurora was unable to clear the second and third elements of the test.

On the second element, the court concluded that the parties’ dispute was commercial in nature, which meant that damages would be an adequate remedy for Aurora’s claims:

[102]   In my view, Aurora’s evidence falls short of establishing that if an injunction is not granted, Aurora will suffer irreparable harm that cannot be quantified in monetary terms. Aurora’s claims against Kilter are mainly rooted in their contention that Kilter has breached the Agreement. Monetary damages would be an adequate remedy should that claim succeed.

[103]   I am not satisfied that Aurora’s reputation will be harmed by Kilter’s alleged actions. It is speculative to suggest that Kilter has held out that non-Aurora LED kits will function properly with the App. Although Aurora, as the App developer, has received complaints about functionality, it is the Kilter product sold to the end user that is the cause of the connectivity issues. It is more likely that Kilter will suffer repercussions from using non-Aurora LED Kits than Aurora will. Aurora has refused and presumably will continue to refuse to connect features of the Kilter board to the App.

Further, the balance of convenience favoured Kilter: “Even if I had found that Aurora would suffer irreparable harm if an injunction was not granted, in assessing which party would suffer greater harm if the injunction is granted or refused, I find that Kilter would suffer greater harm if the injunction was granted”.

In summary, the court decided that “while Aurora has established that there is a serious issue to be tried, I am not persuaded that if the injunction is not granted, Aurora will suffer irreparable harm. Damages will be adequate should Aurora succeed in its claims. The primary evidence Kilter relies on in support of their irreparable harm argument does not rest on a solid evidentiary foundation. Moreover, if the injunction is granted, Kilter will suffer more harm than Aurora”.

The post BC Supreme Court denies application for injunction in commercial dispute, finding plaintiff wouldn’t suffer irreparable harm and balance of convenience favoured defendant first appeared on British Columbia Law Institute.

The application led the court to grapple with the following two issues: (1) whether it had jurisdiction to grant the injunction; and (if it had such jurisdiction) (2) whether the applicant met the three-stage test for a pre-trial injunction set out in RJR-MacDonald Inc. v Canada (Attorney General), 1994 CanLII 117, [1994] 1 SCR 311(SCC).

Jurisdiction to grant an injunction

On the jurisdictional issue, the court found that, despite Jewish National Fund of Canada Inc. v Minister of National Revenue, 2025 FCA 110, the Federal Court of Appeal didn’t have exclusive jurisdiction over this matter, which meant the BC Supreme Court did have concurrent jurisdiction:

[44]      With respect, I disagree [with Jewish National Fund]. Subparagraph 168(2)(b) of the [Income Tax] Act sets out that the FCA may extend the period during which a notice of revocation cannot be published when issuance of a notice has been appealed. However, this section of the Act does not contain “clear and explicit statutory wording” to the effect that exclusive jurisdiction to delay publication is vested in the FCA in all circumstances, for example, where the decision to revoke a charity’s registration is to be challenged in the superior court as ultra vires the Federal government.

[45]      Given that it is the intention of the Charity to challenge the validity of the Act, as opposed to an assessment of taxes, I am satisfied that I have jurisdiction to decide whether it is appropriate to grant an injunction to stay publication of the Notice. See Myers [v Canada (Attorney General), 2022 BCCA 160] at para. 43.

Elements of the RJR-MacDonald test

On the second issue, the court summarized the test from RJR-MacDonald as follows:

The party seeking an interlocutory injunction must establish that:

1.   there is a serious issue to be tried;

2.   irreparable harm would result if the injunction is not granted; and

3.   the balance of convenience, considering all of the circumstances, favours granting the injunction.

The minister of national revenue acknowledged that the charity met the first element.

On the second element, the court noted that it was significant that the applicant was a charity: “It is usually the harm suffered by the applicant that must be considered, although this principle is modified, at least in respect of those dependent on a charity: Glooscap Heritage Society v. Canada (National Revenue), 2012 FCA 255”. Taking this point into account, the court found that, on balance, the charity had met the second element of the test:

[60]      However, I am satisfied based on the evidentiary record before me, that there is clear evidence that proves on a balance of probabilities that deregistration of the Charity will cause irreparable harm to donees, beyond those associated to the “ordinary consequences” of losing registered charity status.

[61]      I am, furthermore, satisfied that publication of the Notice will irreparably harm the reputation of directors and senior management of the Charity.

On the third element, the court noted that it “must consider potential impacts not only to the Charity, but also to the public interest”. The court found, nevertheless, that the balance of convenience favoured the charity:

[74]      On the evidence presented, I cannot conclude that there is presently any ongoing risk to the public interest.

[75]      I am satisfied that the balance of convenience favours the granting of an interlocutory injunction for a short period of time to permit the Charity to file its petition. It is clear that the Charity will suffer greater harm from refusing an injunction than the public interest will be harmed by the granting of an injunction.

[76]      Once the petition is filed, the Charity can apply to extend the injunction. At that time, the balance of competing interests can occur with full knowledge of the seriousness of the issue to be tried, as well as a timeline for the hearing of the petition.

Concluding remarks

In its concluding remarks, the court noted that it was

guided by the words of Justice Groberman in Snuneymuxw [First Nation et al. v R., 2004 BCSC 205]:

[72]      The jurisdiction of the court, in appropriate cases, to interfere in legislative and executive decisions that are under challenge should not be too hastily exercised. The courts have a supervisory role to play, and should be wary of usurping legislative and executive roles and effectively governing by interlocutory order.

[73]      In the case at bar, the injunction that I have indicated I will grant is a very limited one. It does not seriously interfere with governance.

The post Injunction restrains MNR from deregistering Vancouver charity pending constitutional challenge first appeared on British Columbia Law Institute.

Building projects can be delayed or derailed and costs driven up when developers and neighbouring landowners don’t reach timely agreement on access needed to operate construction cranes and perform other essential construction operations. Delays prolong the disruption and inconvenience that construction activity may cause in a neighbourhood. Higher costs are ultimately passed on to purchasers and tenants of new buildings, contributing to the problem of lack of affordability.

When negotiations for access fail, developers have been known to trespass by forging ahead with crane and shoring operations without landowner consent, resulting in litigation. Injunctions against the trespass obtained by landowners can stall construction and force resort to costly workarounds. Where workarounds are not possible or would be too costly, building projects may not proceed at all.

The study paper explains why access to neighbouring land and airspace is often needed during construction. It reviews cases where failed negotiations or a failure to negotiate led to trespassing and injunctions and explains the legal concepts involved. Then it sets out a series of potential solutions for avoiding and resolving access-related disputes.

Typical reasons why builders need access to neighbouring land and airspace

The latticework, fixed-base construction cranes that are familiar sights in urban settings often need to swing over ground lying outside the boundaries of the building site. Their movement can’t be restricted by property boundaries because they must be capable of “weathervaning” (swinging 360 degrees) for safety reasons in high winds. It’s also a legal requirement.

A preferred method for reinforcing (“shoring”) the sides of excavations to prevent cave-ins is to insert anchor rods (also called “tiebacks”) at an angle into the ground behind a temporary shoring wall that may run close to or along a property boundary. Anchor rods may be left permanently in place after construction is completed.

Consent from neighbouring landowners is needed to allow cranes and shoring installations to encroach on their property. If neighbouring landowners refuse to grant access for these purposes, developers can sometimes use mobile cranes or drive piles to support a shoring wall. These workarounds are usually more expensive than the preferred methods and often take longer.

Potential Solutions for Avoiding and Resolving Access Disputes

The study paper presents a series of possible solutions to prevent or resolve construction-related access disputes. The continuum runs from potential solutions that require the least governmental involvement to ones requiring the most.

At one end of the continuum, there are strategies where there is little or no government involvement, except for municipal co-operation and support. These include public education campaigns, neighbourhood-level informational initiatives, and early contact with the landowners surrounding a proposed building site. These initiatives would cover matters like the safety standards that apply to construction cranes, reasons why builders need timely access to adjacent ground and airspace, and the importance of proper shoring for the stability of soil and structures surrounding an excavation.

Another initiative to prevent disputes could be a code of best practices in negotiating access, created by the development industry in collaboration with other stakeholder interests, principally landowners and municipalities. The best practices code would draw upon the collective well of experience in achieving successful outcomes.

Moving on to the middle range of the continuum, the study paper covers mediation and arbitration processes for resolving situations where access is in dispute between a developer and a landowner. As a landowner is not legally obligated to grant access to a developer, resort to voluntary mediation and arbitration could be unlikely. Mandatory mediation or arbitration, on the other hand, could play a significant role in resolving access disputes if a decision-making body were given the necessary authority and the process could be invoked by either the developer or landowner when initial negotiations fail.

Legislation would be needed to make mediation or arbitration mandatory to resolve disputes over construction-related access. The study paper suggests that the Surface Rights Board that now settles the terms of surface leases in the oil and gas and mining sectors, including the level of rent, could be given decision-making authority over construction access disputes as well. The Surface Rights Board uses a mediation-arbitration process. It first tries to mediate a dispute over entry and access between an oil and gas or mining operator and a surface landowner, and if mediation is unsuccessful, the process moves on to arbitration.

Another solution might be to give a court the power to decide whether a developer should be given access to neighbouring property and set the compensation the developer should pay to the landowner. Either party could apply to the court to decide these matters. Australian states, New Zealand, and the UK have legislation allowing similar court applications.

At the far end of the continuum where the most government involvement is to be found are potential solutions involving public policy choices requiring legislative changes to cut down the scope for access disputes. These include passing a law that a crane swinging through airspace is not a trespass. That would make it less likely that a non-consenting landowner could obtain an injunction preventing crane operation, but the landowner could still sue the developer for nuisance if the landowner could prove there was substantial interference with the use of the land below and the intrusion was not by consent.

Another policy choice could be passing a law that simply prevents an injunction from being awarded to a non-consenting landowner against trespass by crane overswing, leaving it still open to the landowner to sue for damages.

The requirement for strata corporations to pass a resolution by a ¾ vote to grant a developer a right of access to common property could be removed so that the resolution could pass with a simple majority of strata lot owners being in favour. This would make it easier for strata corporations to grant access on terms that are acceptable to the majority of owners.

The most drastic measure discussed in the study paper that was raised in stakeholder consultations would be to legislate an automatic right to access neighbouring land and airspace as needed for construction purposes. Landowners would not receive any compensation, except that they could take advantage of the same right of access if they redeveloped their own property in the future.

The study paper does not recommend any one of these potential solutions over another. It is meant to be a contribution to public discussion and assist stakeholders, policymakers and legislators in dealing with land and airspace access issues related to construction.

The post New BCLI Study Paper on a Current Issue in Construction and Property Law first appeared on British Columbia Law Institute.