T-1708-84
Joen Pauli Rasmussen and S/LF Bordoyarvik
(Plaintiffs)
v.
Minister of Fisheries and Oceans, Canada and
Her Majesty the Queen (Defendants)
INDEXED AS: RASMUSSEN V. CANADA (MINISTER OF FISHER
IES AND OCEANS)
Trial Division, Muldoon J.—St. John's, New-
foundland, February 23, 24 and 25; Ottawa,
November 24, 1988.
Fisheries — Claim for compensation for seizure of 70
metric tones of sailfish under s. 6(1)(b) Coastal Fisheries
Protection Act — Foreign ship boarded by fisheries officers
for alleged s. 8(1)(a) offence — Officers refusing offer of bond
or to buy back seized fish — Captain of ship acquitted —
Crown selling fish to itself — Crown trustee of sailfish to full
value and liable to make restitution.
Crown — Torts — Conversion — Crown seizing saltfish
from foreign ship for alleged offence under Coastal Fisheries
Protection Act — Offers to buy back seized fish and to submit
bond in lieu of property refused — Captain of ship acquitted
-- Crown selling fish to Crown corporation — Tort claims to
recover amount beyond that provided by s. 6(9) of Act requir
ing evidence provision inadequate to accord full compensation
and liability of Crown established under s. 3(1) of Crown
Liability Act — Crown liable for tort of wrongful conversion
to extent s. 6(9) provides for return of sum less than full value
of fish — Refusal of Crown to pay full market value of fish
unjust enrichment.
Constitutional law — Charter of Rights — Criminal process
— Seizure of saltfish from foreign vessel and subsequent sale
not offending Charter s. 8 — Fisheries officers having reason
able and probable grounds for apprehending vessel and laying
charge — Authority to seize fish under Coastal Fisheries
Protection Act not unreasonable or contrary to Charter.
In November of 1982, a ship from the Faroe Islands was
boarded by fisheries officers off the coast of Newfoundland for
allegedly fishing in Canadian waters without authorization.
The officers seized 70 metric tones of saltfish under the author
ity of paragraph 6(1)(b) of the Coastal Fisheries Protection
Act. The captain of the vessel offered to post a bond, or buy
back the fish prior to the seizure but was turned down. The
captain was acquitted of the unauthorized fishing charge in
Provincial Court, the Judge finding unreliable the evidence as
to the ship's location. The catch was sold by the Crown to itself
and the plaintiffs were paid $ 51,394.57 as compensation. In
this action the plaintiffs' seek to recover the difference between
the compensation paid and fair market value.
Held, the action should be allowed.
The seizure of a portion of the saltfish on the vessel was not
unreasonable and the authority under which it was effected
does not offend section 8 of the Charter. Furthermore, it cannot
be said that to have demanded a forfeitable bond in lieu of
seizing the fish would have been a more reasonable course of
action.
Law and justice both require that the plaintiffs be compen
sated in full for their loss. However, in order to award compen
sation beyond that provided for in subsection 6(9) of the
Coastal Fisheries Protection Act, it must be demonstrated that
the provision is inherently inadequate to provide full compensa
tion for the loss and that the Crown's liability has been
established within the meaning of subsection 3(l) of the Crown
Liability Act.
By selling the saltfish to itself without the benefit of an
open-market tender, the Crown put itself in a position similar
to that of a trustee. The Crown became liable for the tort of
wrongful conversion to the extent that compensation paid under
subsection 6(9) of the Act was less than market value.
This action sounds in tort and, for a number of reasons, the
defendants' argument (that plaintiffs' only remedy is that
provided for in the statute) could not be accepted: (1) the
statute itself makes no provision for the exclusivity of the
remedy; (2) the proceeds being possibly inadequate to compen
sate for the loss, the person affected could be unjustly inflicted
with the loss; (3) where seized property is converted by the
operation of law into property of the Crown, Parliament cannot
allow the Crown to gain an unjust enrichment without having
to account for it; and (4) the Crown, by the operation of the
Crown Liability Act, is made to assume responsibility for the
tortious acts of its servants.
STATUTES AND REGULATIONS JUDICIALLY
CONSIDERED
Canadian Bill of Rights, R.S.C. 1970, Appendix I11, ss.
1(a), 2.
Canadian Charter of Rights and Freedoms, being Part I
of the Constitution Act, 1982, Schedule B, Canada Act
1982, 1982, c. 11 (U.K.), ss. 8, 11(d),(e), 24.
Coastal Fisheries Protection Act, R.S.C. 1970, c. C-21,
ss. 5 (as am. by S.C. 1985, c. 26, s. 5),
6(1)(b),(3),(4),(6),(9).
Criminal Code, R.S.C. 1970, c. C-34, s. 25.
Crown Liability Act, S.C. 1952-53, c. 30.
Crown Liability Act, R.S.C. 1970, c. C-38, ss.
3(1 )(a),(b), 4( 4 ).
Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, ss.
35, 40.
Federal Court Rules, C.R.C., c. 663, R. 337(2)(b).
Fisheries Act, R.S.C. 1970, c. F-14, ss. 58(1),(3),(6), 59.
Interest Act, R.S.C. 1970, c. I-18, s. 3.
Newfoundland Regulation 63/84.
Sailfish Act, R.S.C. 1970 (1st Supp.), c. 37, s. 14(3).
The Judgment Interest Act, S.N. 1983, c. 81, ss. 3(1),
4(I), 10.
CASES JUDICIALLY CONSIDERED
APPLIED:
Re Milton et al. and The Queen (1986), 32 C.C.C. (3d)
159 (B.C.C.A.); Miller v. The King, [1950] S.C.R. 168;
Guerin et al. v. The Queen et al., [1984] 2 S.C.R. 335; R.
v. McRae (1980), 115 D.L.R. (3d) 420 (B.C.S.C.); Mar-
shall v. Canada (1985), 60 N.R. 180 (F.C.A.); Leblanc
et al. v. Curbera, [1983] 2 S.C.R. 28.
CONSIDERED:
Rasmussen v. Breau, [1986] 2 F.C. 500 (C.A.).
REFERRED TO:
Rasmussen v. Breau, [1985] 2 F.C. 445 (T.D.).
COUNSEL:
John R. Sinnott for plaintiffs.
Robert P. Pittman for defendants.
SOLICITORS:
Lewis, Sinnott & Heneghan, St. John's, New-
foundland, for plaintiffs.
Aylward, Morris & Pittman, St. John's, New-
foundland, for defendants.
The following are the reasons for judgment
rendered in English by
MULDOON J.: The plaintiffs claim the money-
value which they allege they lost, as a result of
confiscation by the defendants' servants and offi
cials of saltfish, from the ship Bordoyarnes be
tween November 12 to November 14, 1982. The
defendants' servants seized seventy metric tones of
saltfish, invoking paragraph 6(1)(b) of the Coastal
Fisheries Protection Act, R.S.C. 1970, c. C-21.
This action was originally taken against three
defendants, the third having been the Canadian
Saltfish Corporation. That third defendant
brought a motion to have the Canadian Saltfish
Corporation (hereinafter: the Corporation)
removed as a defendant. Mr. Justice Strayer dis
missed the Corporation's motion as is reported at
[1985] 2 F.C. 445 (T.D.) [Rasmussen v. Breau].
The Corporation appealed against the dismissal of
its motion, however, and its appeal was allowed by
a unanimous panel of the Appeal Division of this
Court as is reported at Rasmussen v. Breau,
[1986] 2 F.C. 500. Accordingly, the action was
dismissed as against the Corporation with costs,
and the Corporation is not further involved here in
the role of a party to this action.
The plaintiff, Joen Pauli Rasmussen (herein-
after, Capt. Rasmussen) is a resident of the Faroe
Islands. At all material times he was the master of
the Bordoyarnes (hereinafter: the fishing vessel,
the vessel, or, the ship) a 45.1 m long, 181 tonnes,
steel-hulled longliner which was owned by S/LF
Bordoyarvik, a body corporate under the laws of
the Faroe Islands, with head office at Klakksvik
therein. The corporate plaintiff was previously
known as S/LF Boreas.
The vessel was licensed by the Minister as a
foreign fishing vessel under the above cited Act,
for 1982, under a licence No. 1-21-004 dated at
St. John's, Newfoundland, on April 7, 1982. A
copy of that licence was received as Exhibit 1 at
the trial. The licence permitted the vessel to fish
between August 12 and November 30, 1982,
within divisions 2G and 2H shown on Exhibit 2.
On or about November 5, 1982, Capt. Rasmuss-
en, aboard the fishing vessel, was engaged in fish
ing operations in the Labrador Sea. The vessel had
been observed a few days earlier, on November 1,
from a Canadian Armed Forces patrol aircraft
which reported some positional coordinates to the
defendants' servants and officials in St. John's. As
a resutt, the Fisheries patrol vessel Terra Nova
went haring out of St. John's and Fisheries officers
arrested the Bordoyarnes by boarding her and
ordering Capt. Rasmussen to proceed to St.
John's. He complied. On November 9, 1982, an
information was sworn by a fisheries officer in the
Provincial Court of Newfoundland, Exhibit 3,
charging that Capt. Rasmussen:
Did on or about the 5th day of November, A.D. 1982, while
being aboard a foreign vessel in Canadian waters, fish without
authorization contrary to Section 3(2)(a) of the Coastal Fish
eries Protection Act ... , thereby committing an offence con
trary to Section 81(1)(a) of the said Act.
Paragraph 6 of the plaintiffs' statement of
claim, admitted by the defendants, continues:
On the 10th day of November, 1982, the said [Capt.] Rasmuss-
en appeared before the Provincial Court of Newfoundland at
St. John's respecting the charge and on the 12th day of
November, 1982 made a further appearance at which time an
election to be tried by a judge without a jury in District Court
was made and February 23rd and ... 24th, 1983 were set for
the holding of a preliminary inquiry.
Paragraph 7 of the statement of claim asserts
that:
On or about the 10th day of November, 1982, before election,
plea, or trial, representatives of the ... defendants advised ...
[Capt.] Rasmussen, that they intended to offload 70 tonnes of
salt fish from the "Bordoyarnes" commencing Friday, Novem-
ber 12, 1982, and that the salt fish would be sold. [Capt.]
Rasmussen was advised that a bond was not acceptable to the
Canadian Fisheries Officials of the ... defendants. [Capt.]
Rasmussen was further advised by the ... [said] officials that
the salt fish could not be sold to Captain Rasmussen in order to
avoid offloading on the grounds that offloading of the salt fish
was a deterrence to other fishing vessels. The Canadian Fisher
ies officials further rejected offloading just 30-40 tonnes of salt
fish.
By paragraph 4 of the statement of defence, the
defendants admit all of the foregoing, but add that
the defendants' servants "at that time understood
that there were legal impediments to accepting a
bond".
The fate of the 70 tonnes of saltfish will be
discussed later on herein, but first it is important
to note the fate of the charge brought against
Capt. Rasmussen. He went to trial, not before the
District Court, but before the Provincial Court, on
May 27, 1983. The trial endured for five days
before His Honour Judge Seabright who delivered
his oral reasons for judgment (transcribed, Exhibit
5) on June 20, 1983. Judge Seabright found that
the evidence about the Bordoyarnes position was
unreliable and "that there is no one that shows
where they actually crossed the boundary and
when they were. actually fishing". He also found
`that Capt. Rasmussen "took all the diligence that I
can see that he was needed to do in order to show
that he was not negligent in this matter". Judge
Seabright concluded "it would seem to me that on'
the basis of all this ... he is entitled to an acquittal
on this matter, and I am going to so do at this
particular time". (Exhibit 5, at page 416.)
From this acquittal, the Crown lodged a notice
of appeal (Exhibit 6) dated July 12, 1983, followed
by a notice of abandonment of the appeal (Exhibit
7) on March 22, 1984. In the result, Capt. Ras-
mussen was judicially found not to have commit
ted the offence of which he was accused.
Returning to the defendants' seizure of the salt-
fish, it is clear that their fisheries protection offi
cers were invoking and acting pursuant to subsec
tion 6(1) of the Coastal Fisheries Protection Act,
above cited. It provides:
6. (I) Whenever a protection officer suspects on reasonable
grounds that an offence against this Act has been committed,
he may seize
(a) any fishing vessel by means of or in relation to which he
reasonably believes the offence was committed;
(b) any goods aboard the fishing vessel, including fish,
tackle, rigging, apparel, furniture, stores, and cargo; or
(e) the fishing vessel and any of the goods mentioned in
paragraph (b).
The following subsections are also of importance
in the circumstances of this case:
6....
(3) Subject to this section, the fishing vessel and goods seized
under subsections (1) shall be retained in the custody of the
protection officer making the seizure or shall be delivered into
the custody of such person as the Minister may direct.
(4) Where fish or other perishable articles are seized under
subsection (I),the protection officer or other person having the
custody thereof may sell them, and the proceeds of the sale
shall be paid to the Receiver General or shall be deposited in a
chartered bank to the credit of the Receiver General.
(6) Where a fishing vessel or goods have been seized under
subsection (1) and proceedings in respect of the offence have
been instituted, the court or judge may, with the consent of the
protection officer who made the seizure, order redelivery there-
of to the accused upon security by bond, with two sureties, in
an amount and form satisfactory to the Minister, being given to
Her Majesty.
(9) Where a fishing vessel or goods have been seized under
subsection (1) and proceedings in respect of the offence have
been instituted, but the fishing vessel or goods or any proceeds
realized from a sale thereof under subsection (4) are not at the
final conclusion of the proceedings ordered to be forfeited, they
shall be returned or the proceeds shall be paid to the person
from whom the fishing vessel or goods were taken ....
[Emphasis not in statutory text.]
In the light of subsection 6(6) recited above, one
must wonder why the defendants pleaded in para
graph 4 of their statement of defence that their
"servants at that time understood that there were
legal impediments to accepting a bond". The
answer came in the testimony of the defendants'
witnesses Lawrence Wilfred Penney and Ernest
William Collins. In 1980, the master of the French
fishing vessel, Joseph Roty II, was charged with
an offence under the fisheries regulations, but
released on bail bond in the amount of $25,000
and a recognizance. Because the master did attend
at his trial, the recognizance and bond were
voided, but the defendants' servants in that
instance believed that the master's bail recogni
zance was a bond in lieu of the fish which they
could have seized and were surprised to discover
that it was, of course, no such thing. If the defend
ants' servants took advice in law, it would seem
that even their adviser must have been negligent in
order to impart the advice which caused them to
believe that they could not accept a bond instead
of seizing the fish. If it were necessary to do so,
that negligence could and would be fixed to the
defendants here, in view of the clear provisions of
subsection 6(6) of the Act.
However, negligence does not enter into the
defendants' servants' declining Capt. Rasmussen's
offer of a bond, or to buy back the fish which they
were about to seize. While the plaintiffs and their
counsel were aghast at the fisheries officers' clear
ignorance of the statute of which they were
charged with securing compliance and enforce
ment, taking a bond was only one of two courses
which were lawfully open to the officers. Seizing
the fish, which they did, was the other course, anc
doing neither might be said to constitute the thirc
course. The pleading whereby the defendant:
admitted ignorance of the law was expressed foi
whatever now obscure motive the defendants
solicitors had in mind.
Under subsection 6(1) of the Coastal Fisheries
Protection Act the defendants' servants could law
fully have seized not only the whole catch of fish,
but also the vessel itself. The defendants' wistful
ness about their servants' ignorance of subsection
6(6), melts before the heat of their admitted deter
mination to make an example of Capt. Rasmussen.
in order to deter other masters of fishing vessels
from breaches of the law.
In the circumstances revealed here the plaintiffs
have asserted that the defendants offended against
"the Canadian Charter of Right and Freedoms,
and in particular section 8 ... guaranteeing the
right to be secure against unreasonable seizure,
and section 11(d) ... embodying the right to be
presumed innocent until proven guilty according to
law, and section 11(e) . .. embodying the right not
to be denied bail without just caused" and thereby
caused the plaintiffs to suffer damages. On the
other hand, the defendants plead and rely upon
"the Fisheries Act, R.S.C. 1970, Chap. F-14, in
particular, section 58(3) ... and the Criminal
Code of Canada R.S.C. 1970, Chap. C-34, in
particular, section 25 thereof". It is convenient to
consider these pleadings in inverse order.
Section 25 of the Criminal Code [R.S.C. 1970,
c. C-34] provides essentially that everyone who is
required or authorized by law (federal or provin
cial) to do anything in the administration or
enforcement of the law is, if he acts on reasonable
and probable grounds, justified in doing what he is
required or authorized to do and in using as much
force (but not more), as is necessary for that
purpose. Obviously the law would pose an impos
sible conundrum if one provision required a person
to do something and at the same time, another
provision forbade one from doing it. Section 25,
and in particular subsection 25(1), are emplaced in
the Criminal Code in order to avoid the law's
speaking with such a forked tongue. Hence, justifi
cation, if pursued according to the terms pre
scribed in the statute, obviates criminality on the
part of the person who does what is required or
authorized by law. It differs from an excuse, in
that a justified act is by definition not criminal at
all, whereas an excused act is an offence, but
carried out in desperate circumstances in which
the law declines to condemn or denounce the per
petrator. Justification does not necessarily deter
mine the question of whether or not what was done
nevertheless amounts to a civil wrong or tort.
Clearly, the defendants' servants would not have
been subject to criminal prosecution for their part
in the circumstances of this case. Patently, and for
the moment ignoring consideration of sections 8
and 24 of the Charter [Canadian Charter of
Rights and Freedoms, being Part I of the Consti
tution Act, 1982, Schedule B, Canada Act, 1982,
1982, c. 11 (U.K.)], sections 5 [as am.by S.C.
1985, c. 26, s. 5] and 6 of the Coastal Fisheries
Protection Act seem, in the circumstances revealed
here, to absolve the defendants' servants of crimi
nal liability. This observation, however, does not
conclude the issues in contention between the
parties.
On the second day of the trial, the defendants'
counsel stated that, after conferring with the plain
tiffs' counsel, the defendants' counsel was aban
doning the pleading whereby the defendants relied
on the Fisheries Act [R.S.C. 1970, c. F-14] and in
particular, subsection 58(3) thereof. So be it.
It should be noted that the evidence clearly
discloses that the saltfish seized from the Bor-
doyarnes were in peril of rotting or spoiling only
because they were wrenched from the salt packing
in the vessel's hold by the defendants' servants in
the first place. There was, and would have been, no
peril of spoilage if the 70 tonnes of saltfish had
remained undisturbed on board. Any emergency
was entirely of the defendants' own making.
The plaintiffs' plea of denial of reasonable bail
without just cause in breach of paragraph 11(e) of
the Charter was not supported by any evidence.
The information and summons were completed on
November 9, 1982. Capt. Rasmussen was before
the Newfoundland Provincial Court on November
10 and 12. He pleaded "not guilty", and was told
to return for trial in February 1983, later post
poned to May 1983. The 70 tonnes of fish was
offloaded from the ship on and between
November 12 and 14 while Capt. Rasmussen was
lodged in a hotel in or near St. John's. He was
accorded an extension of his fishing licence to
enable him to continue fishing until the end of
November 1982 and the Bordoyarnes with master
and crew set out to continue their fishing. They
caught almost 70 tonnes and with a full load of
about 388 to 390 tonnes they arrived at their port
in the Faroes on or about December 8, 1982.
Paragraph 11(e) of the Charter was neither
infringed, nor denied.
Paragraph 11(d) of the Charter, guaranteeing
the presumption of innocence until proved guilty
according to law was likewise not infringed nor
denied. Capt. Rasmussen was not found to be
guilty at all. He was acquitted. The seizure of the
fish cannot be regarded as infringement or denial
of the presumption and, in any event, the plain
tiffs' counsel made it quite clear at the trial that
the plaintiffs are not now alleging that the fisher
ies officers, the defendants' servants lacked reason
able and probable grounds for apprehending the
vessel and laying the charge. He asserted, indeed,
that they had such grounds, and denied any allega
tion of bad faith. Moreover, the plaintiffs' counsel
admitted that they do not allege that the seizure or
even refusal of a bond was unlawful, but rather
only that the sale of the fish was unlawful. Those
admissions by counsel are recorded at pages 113 to
117 of the first day's transcript of proceedings.
Those admissions, when regarded in the light of
the reasons rendered by Mr. Justice Craig for a
unanimous panel of the British Columbia Court of
Appeal in Re Milton et al. and The Queen (1986),
32 C.C.C. (3d) 159, dispose of the allegation of
violation of section 8 of the Charter. The factual
circumstances of that case were quite different
from those of the case at bar, and yet the legal
considerations are closely analogous. There, the
petitioners' fishing nets had been seized by fisher
ies officers pursuant to subsection 58(1) of the
Fisheries Act, R.S.C. 1970, c. F-14, even though
the petitioners were not charged with any offence
as a result of the seizure of their nets. By operation
of subsection 58(6) of that Act, the nets were
forfeited subject to the disposition of an applica
tion to a judge of the county or district court under
section 59 of the Act.
The pertinent passages in the reasons written by
Craig J.A. in the Milton case are these:
The judge premised his decision on the view that when the
Crown seized goods under s. 58(1) and relied on s. 58(6) for
forfeiture, such seizure was "for the purpose of the forfeiture".
Purporting to rely on the test for reasonable search and seizure
enunciated by Dickson J. in Hunter et al. v. Southam Inc.
(1984), 14 C.C.C. (3d) 97, 11 D.L.R. (4th) 641, [1984] 2
S.C.R. 145, the trial judge said that he "must focus on the
impact on the subject of the seizure and not on rationality of
furthering some valid government objective". The trial judge
concluded, also, that the decision in Southam was "not restrict
ed to questions of invasion of privacy". [Page 163.]
The fisheries officers seized the nets because they thought
reasonably they had been used in connection with the commis
sion of an offence against the Act or the regulations. Forfeiture
could result from the seizure, but not necessarily; accordingly,
it is not correct to say that seizure was for the purpose of
forfeiture. Whether there will be forfeiture of the applicant's
interest will depend on the outcome of the application under s.
59(2) and 5(b).
I think that the trial judge erred, too, in stating that "the test
of reasonableness must focus on the impact on the subject of
the seizure and not on rationality of furthering some valid
government objective". [Pages 167-168.]
The trial judge seemed to think that there is only one concern
namely, the impact on the subject of the seizure, but, it is
obvious from the judgment of Dickson J. that there are two
considerations for the court: (1) the impact of the seizure on
the subject; (2) the seizure's rationality in furthering some valid
government objective. [Page 168.]
In resolving this issue, I am mindful of the statement by
Dickson J. that the "... guarantee of security from unreason
able ... seizure only protects a reasonable expectation". In the
absence of some special right, a person cannot commit an
offence against the Fisheries Act or regulations with impunity
nor is he entitled to expect that anything used in the commis
sion of the offence — in this case, fishing nets — should be
exempt from seizure and possible forfeiture. What he is entitled
to expect — and Crown counsel concedes this — is that prior to
the hearing of the application under s. 59(5) he will know the
nature of the offence which is alleged to have been committed
and which prompted the seizure. When one looks at the issue in
this light one can only conclude that seizure in this case was
reasonable. Surely it is not unreasonable that a peace officer, or
other person charged with the enforcement of an Act, should be
empowered to seize something which, he believes on reasonable
grounds, is being used in the commission of an offence. Crown
counsel referred to a number of cases which he submitted to
support his argument that seizure in this case was not unrea
sonable, including some decisions of the U.S. Supreme Court
relating to the seizure of vessels which were being used to
commit a criminal offence. I do not intend to refer to them
because I think the guiding authority for us is the decision in
Hunter v. Southam. Considering all the circumstances, I am
satisfied that the provisions of ss. 58(6) and 59(5)(b) and (c)
are not inconsistent with s. 8 of the Charter. [Pages 169-170.]
Here Capt. Rasmussen was indeed charged with
an offence under the Coastal Fisheries Protection
Act, but he was acquitted after a lengthy trial.
When contrasted with the invasion of privacy per
petrated by the seizure of one's personal papers
from one's person, home or office, to give a fla
grant example, the seizure of saltfish from the hold
of the corporate plaintiff's ship is no appreciable
invasion of privacy, if it be such at all. When
contrasted with Parliament's objective in enacting
the relevant provisions of the Coastal Fisheries
Protection Act, that is, the conservation and
enhancement of the nation's fishery resources, one
must agree with Craig J.A. and his colleagues that
the true conclusion is that the seizure of a portion
of the saltfish carried in the vessel was, and is, not
unreasonable. The authority to do it, and its actual
doing, do not offend section 8 of the Charter. It
cannot be gainsaid, withal, that exacting a forfei-
table bond in lieu of physical seizure of the fish, as
Parliament also provided, would have been, and
remains, an even more reasonable course of official
conduct.
So, in fact, the defendants' servants took the
plaintiffs' 70 tonnes of fish and the plaintiffs were
judicially found to have committed no offence. The
defendants thereafter declined to pursue any test
of that judicial disposition and abandoned their
appeal. Law and justice both require that the
plaintiffs be compensated in full for that loss
which was visited upon them by the defendants,
without any fault on the plaintiffs' part. If, as the
plaintiffs allege, the defendants have not compen
sated them in full, are they bound to accept the
defendants' tally of the proceeds of sale of the
plaintiffs' fish and thereupon be bound to limit
their claim to the terms of subsection 6(9) of the
Coastal Fisheries Protection Act? If the sum of
$51,394.57 paid by the defendants be found to
amount to full compensation for the seized fish it
will certainly be "the proceeds [to] be paid to the
person from whom ... [the fish] ... were taken".
But, what if the proper sum to be assessed
pursuant to subsection 6(9) be inadequate to com
pensate the plaintiffs for their undeserved loss? Is
the claim to assessed under the Act subsumed
within a broader claim in tort against the defend
ants? Or, does the operation of subsection 6(9)
exclude any tort claim? The Appeal Division of
this Court seemed to believe, in obiter dictum, that
the claim is not one in tort. In the case of Ras-
mussen v. Breau, above cited, the panel, speaking
through the Chief Justice of that time, wrote this
[at pages 512-513]:
Martland J. [in Conseil des Ports Nationaux v. Langelier et al.
[1969] S.C.R. 60] summed up the position as follows [at pages
74-75]:
But as already stated, there was always recourse in the
common law courts in respect of acts done, without legal
justification, by an agent of the Crown, and the Board, on
that principle, is liable if it commits itself, or orders or
authorizes its servants to commit, an act done without legal
justification.
That, in my opinion, is the law and the only law on which the
appellant [the Canadian Saltfish Corporation] can be held
liable for the conversion alleged in the statement of claim. It is
the law of the province of Newfoundland and in no way federal
law. Federal Crown law is not involved. And while liability of
the Crown, for the alleged tort of the appellant, may arise
under the Crown Liability Act, that of the appellant will not.
Nor will it arise under section 14 of the Saltfish Act or any like
provision. It seems to me to follow that the Court has no federal
law to administer in respect of the claim against the appellant
and that the Court is without jurisdiction to entertain it. See
fédérale pouvant être appliquée par la Cour à l'égard du
recours contre l'appelant et que la Cour ne peut recevoir cette
demande. Voir les arrêts Quebec North Shore Paper Co. et
autre c. Canadien Pacifique Ltée et autre ([1977] 2 R.C.S.
1054) et McNamara Construction (Western) Ltd. et autre c. La
Reine ([1977] 2 R.C.S. 654).
III su tar as the claim tor the proceeds of sale of the fish can
be based on subsection 6(9) of the Coastal Fisheries Protection
Act, (R.S.C. 1970, c. C-21), it appears to me that there is
federal law to support the jurisdiction of the Court but, in my
opinion, such a claim is not one in tort. It is, as it seems to me,
simply a situation in which property of a person is in the hands
of the Crown and the only jurisdiction of this Court to entertain
a proceeding for its recovery is that conferred by section 17 of
the Federal Court Act which, as 1 have already indicated, does
not authorize an action against an agency of the Crown but
only against the Crown eo nomine.
Thurlow C.J. wrote that the tortious conversion
levied against the defendants here must be that
which is contemplated by the law of the province
of Newfoundland. He referred to the Crown Lia
bility Act [S.C. 1952-53, c. 30] as the means
whereby the liability of the Crown, for the alleged
tort of the Canadian Saltfish Corporation, may
arise. But the Chief Justice went on to opine that
the claim pursued under subsection 6(9) of the
Coastal Fisheries Protection Act was, in his opin
ion, not one in tort.
Of course, the Crown is liable in tort for dam
ages in respect of a tort committed by a servant of
the Crown, as Parliament provided in paragraph
3(1)(a) of the Crown Liability Act, R.S.C. 1970,
c. C-38 and amendments. Paragraph 3(1)(b) of
that Act also provides that the Crown is liable in
tort "in respect of a breach of duty attaching to
the ownership, ... possession or control of proper
ty", which surely makes one wonder why the
Appeal Division held that the tort of conversion of
property arises only out of the provincial law, but
even so, Parliament has enacted that the Crown
shall be liable for it. "Tort" is defined in the Act,
as being, in respect of matters arising in Quebec,
delict or quasi-delict, showing that provincial law
was in the legislator's mind. Subsection 4(4) of the
Crown Liability Act does not purport to absolve
the Crown of the liability fixed by section 3 of that
Act, but it does provide that "No proceedings lie
against the Crown by virtue of paragraph 3(1)(b)
unless, within seven days after the claim arose,
notice in writing of the claim and of the inquiry
complained or' be served on certain servants and
officers of the Crown, always including the Deputy
Attorney General of Canada. The defendants do
not deny the service of such notice in their state
ment of defence; nor do the plaintiffs assert com
pliance with subsection 4(4) in their pleadings. No
evidence was tendered either to show such compli
ance or to negative it. In such circumstances,
where the law is clear and no statutory flaw is
demonstrated whereby the plaintiffs were, or could
be, obstructed from compliance, the maxim omnia
praesumuntur rite et solemniter esse acta does not
apply. It was not argued.
Accordingly, if the plaintiffs are to establish
their claim in tort, beyond the provisions of subsec
tion 6(9) of the Coastal Fisheries Protection Act,
they must demonstrate that subsection 6(9) is
inherently inadequate to accord them full compen
sation for their loss and that the Crown's liability
is established within the meaning of subsection
3(1) of the Crown Liability Act.
The seized saltfish were sold through the Crown
Assets Disposal Corporation to the Canadian Salt-
fish Corporation. According to subsection 14(3) of
the Saltfish Act, R.S.C. 1970 (1st Supp.), c. 37, as
it then stood:
14....
(3) Property acquired by the Corporation is the property of
Her Majesty and title thereto may be vested in the name of Her
Majesty or in the name of the Corporation.
Since subsection 14(3) is not restricted only to real
property and "property" is not so defined in this
latter statute, it perforce extends to personal prop
erty, meaning the seized fish. Thus, it is shown
that in effect, the Crown sold the plaintiffs' fish to
the Crown. That was no open-market sale on
tender. It is clear in the text of the Saltfish Act
that the services of the Corporation would not
have been needed if the fish had been sold only in
the local market, for the Corporation's monopoly
operates in inter-provincial and international
transactions. In any event, the Crown dealt the
fish to itself. That kind of dealing with the plain
tiffs' property rendered to Crown akin to a trustee,
perhaps a trustee de son tort, of the plaintiffs'
property and its full monetary value. Authorities
for the imposition of a fiduciary duty on the
Crown, albeit in matters of equitable land claims,
are Miller v. The King, [1950] S.C.R. 168, at
pages 177 and 178, and Guerin et al. v. The Queen
et al., [1984] 2 S.C.R. 335. The principles of the
Crown's equitable obligations enunciated in those
high authorities are quite applicable in the circum
stances of this case, at least in the sense that it is
far from unthinkable that the Crown could indeed
perpetrate the tort of wrongful conversion of the
plaintiffs' property, by sale.
Thus, to the extent that the Crown adopts the
position that subsection 6(9) of the Coastal Fish
eries Protection Act exacts return to the plaintiffs
of a sum less than the full monetary value of the
seized fish, to that extent the Crown becomes
liable for the tort of wrongful conversion, as Par
liament ordained in paragraph 3(1)(a) of the
Crown Liability Act. The evidence demonstrates
that the plaintiffs' fish was so dealt with by ser
vants of the Crown, or through the Corporation, in
effect, by the Crown eo nomine.
Accordingly, the Court holds that: either subsec
tion 6(9) of the Coastal Fisheries Protection Act
commands the Crown to "make full restitution for
the proceeds of the sale, meaning the full mone
tary value of the sale; or such restitution is sub
sumed in the monetary sum to be awarded as
compensation for the Crown's tort of wrongful
conversion. Here the Crown asserts that it has
already paid every last cent due to the plaintiffs.
The validity, or otherwise, of that assertion is what
remains to be determined.
It is not every sum of the proceeds of sale which,
in law or equity, will serve the purpose even of
statutory compensation. The case of R. v. McRae
(1980), 115 D.L.R. (3d) 420, decided by Mr.
Justice Wallace of the Supreme Court of British
Columbia, turned on the sale of 74 sockeye salmon
seized and sold pursuant to subsection 58(3) of the
Fisheries Act. Here again are somewhat different
circumstances but closely analagous legal con
siderations. Of the 76 fish seized from Mrs.
McRae, 74 were sold to the Salvation Army for
the sum of $1, and the remaining two were
retained for evidence. After the Crown withdrew
and stayed all charges, the judge of first instance
ordered [at page 22] "that an equivalent of 76 ...
Salmon be returned to RITA McRAE".
Upon an application for certiorari to quash that
judge's order, the Crown relied on the provisions of
subsection 58(3) which enact that seized fish sub
ject to spoilage may be sold "in such manner and
for such price [as the person having custody there
of] may determine". Crown counsel also submitted
that the Fisheries Act and particularly section 58,
are a complete statutory code respecting seizure
and return of property by fisheries officers. It was
further asserted that Mrs. McRae was entitled
only to the one dollar being the same sum—"The
proceeds of a sale"—received from the disposition
of the salmon. Clearly the authority to deal
administratively with an individual's property car
ries with it the duty to deal fairly. Here is some of
what was written by Wallace J. in his reasons for
judgment in the McRae case:
The fact that Parliament has seen fit to delegate the decision
as to the appropriate terms of sale of the seized fish to the sole
discretion of the officer does not negate the duty of fairness. It
does have a bearing on the nature of the procedural protection
appropriate for this particular decision.
At the very least, this "duty of fairness" would require the
officer to make every reasonable effort to obtain as close to the
market value as possible for the property being sold, if it had a
market value, and if not, the best possible price in the light of
the prevailing circumstances. What occurred here, of course,
was not a "sale" but a donation of articles, having a value of
many hundreds of dollars, to a community service organization,
a procedure not contemplated, or authorized, by s. 58 of the
Fisheries Act [Page 425.]
The fisheries officer ... seized all the fish owned by Rita
McRae, when the legal objective of the seizure would have been
completely satisfied if only two fish had been seized;, the
fisheries officer, following what I consider to be an unjustified
Department policy, deprived Mrs. McRae of her property,
improperly giving it away, offering her one ($1) dollar as
compensation; that Mrs. McRae has now been improperly
deprived of her property for two years without due process of
law. There is no suggestion she has committed any offence.
Almost a full year after the charge was laid the Crown
stayed the proceedings against her and the Department of
Fisheries offered Mrs. McRae $1 as full compensation for her
property, thereby imposing an unauthorized punishment upon a
citizen against whom they did not intend to proceed with
charges.
Crown counsel submitted that if Rita McRae was dissatisfied
with the $1 compensation she must sue in Federal Court for
any additional compensation to which she considers she is
entitled and thereby be required to incur further months of
delay, costs and the continual deprivation of her property.
The only justification advanced for the fisheries officer's
actions in giving away the property of Rita McRae, and for
refusing compensations, is the stated "policy" of the Depart
ment of Fisheries and that Department's interpretation of the
provisions of s. 58(3) of the Fisheries Act. [Page 427.]
In the result Wallace J. declined to quash the
provincial judge's order of restitution in kind. The
decision surely stands for the proposition, which
this Court adopts, that the Crown's tendering of
"proceeds" which are inadequate, does not at all
deprive the owner of the fish from claiming the
full, fair value of his fish which were converted
through sale of them by the defendants. Payment
of less than the full value would accord the Crown
an unjust enrichment in these circumstances.
If the fish had not been seized, the Bordoyarnes
would have returned to its home port in the Faroes
with the 70 tonnes well salted and in marketable
condition. (According to the witness Lawrence
Wilfred Penney the quantity of some 70 tonnes
was determined from the plaintiffs' log as the
approximate weight of the catch after October 15,
1982, the date on which a departmental observer
was last aboard the vessel, until November 5, when
she was apprehended. Such reasoning seems to
imply that Capt. Rasmussen, in the defendants'
view, began fishing illegally as soon as the inspec
tor's back was turned, with no time even to pro
ceed to the allegedly forbidden waters.) There is
nothing before the Court to suggest that the plain
tiffs would not have realized their proper and full
price for their catch, including the 70 tonnes, had
no seizure been effected.
According to the Canadian Saltfish Corpora
tion's statement, Exhibit 10, dated November 30,
1982, the Corporation discharged 153,800 pounds
of "saltbulk" from the vessel. One kilogram is
2.2046 lbs. One metric tonne, being 1,000 kg, is
2,204.6 lbs. So, 70 tonnes is 154,322 lbs., or 522
lbs. (about one-quarter tonne) more than
Exhibit 10 discloses. Paragraph 5 of the statement
of defence contains an admission "that 70 metric
tons of salt fish were offloaded". Since Exhibit 10
was presented by and through the plaintiffs' wit
ness, Carl Wheeler, the plaintiffs' explanation,
made in written submissions after the trial, is
accepted: "the slight reduction would presumably,
have occurred as the result of lost salt and mois
ture during the offloading process, which would be
normal during the moving of partly cured salt
fish". For purposes of calculation the metric
equivalent can be taken at 69.763 tonnes.
In cross-examination Mr. Wheeler indicated
that the "proceeds" paid to the plaintiffs were
made up of the prices for wetsalted, head-on,
gutted fresh fish, purchased for salting, as dis
closed on page 26 of the Corporation's Annual
Report for 1982, Exhibit 13. Such a basis of
payment is revealed in Mr. Wheeler's testimony
recorded on pages 35, 36 and 38, and again on
pages 73 to 75 of the transcript of proceedings on
the second day of the trial. This is not the proper
basis for compensation to the plaintiffs for the full
monetary value of their fish. Their fish was being
salted with heads removed. The market value of
their fish such as they would have received, had
they never been troubled by the defendants' sei
zure of their fish, is the proper standard of
compensation.
The Crown Assets Disposal Corporation which
purported to dispose of the plaintiffs' fish to the
Saltfish Corporation, reported on the first page of
Exhibit 12 the minimum prices for various grades
of the plaintiffs' fish. Mr. Wheeler was asked to
calculate the value of the quantity of fish shown in
Exhibit 10—the 153,800 pounds offloaded from
the Bordoyarnes, at the minimum prices reported
by the Crown Assets Disposal Corporation in
Exhibit 12, page 1. He calculated $111,365.84, the
correctness of which calculation was not contested
by the plaintiffs' counsel. The disposal corporation
purported also to impose responsibility for offload-
ing and transportation costs upon the Saltfish Cor
poration, so that by those standards, the sum of
$111,365.84 would have been the gross proceeds of
the sale at minimum prices.
The plaintiffs' counsel urges that the evidence
calls for an even greater, full-value, monetary
compensation for the plaintiffs' fish. Capt. Ras-
mussen testified that at the material time, in 1982,
the exchange rate was seven kronor to the Canadi-
an dollar. This is the only evidence of it before the
Court. Neither side called or adduced any evi
dence from the foreign exchange department of
any bank, or such like, by which the rate could be
independently established. The defendants' counsel
noted such lack of independent evidence, but he
did nothing to fill that void. However, Capt. Ras-
mussen, despite his imperfect command of the
English language, was definitely a most credible
witness. His testimony as to the exchange rate was
uncontradicted and it is the only evidence before
the Court. He further testified (page 48 of the first
day's transcript) that "My home price was 14.5
kronor per kilo". That was the medium price in the
range of size and qualities. (Page 57.) The value of
those 69 and three-quarters tonnes of fish taken
from him, if the defendants had left it on board,
would therefore have been worth to the plaintiffs a
medium price of $2.07143 Cdn. per kilo, or, for
69.763 tonnes, the total sum of $144,509.17. That
is the total monetary value which the Crown
appropriated on an overall medium price for the
69.763 tonnes. Capt. Rasmussen testified about
the specific grades of size and quality and the
prices therefor which are fixed by a Committee of
the "Home Government", which appears to set an
initial floor price for fish brought home by Faroese
fishing vessels. He recited the respective prices for
choice, No. 1 quality of various sizes, No. 2 quality
of various sizes and No. 3 quality of various sizes.
He then applied the weights and grades (there
were no No. 3 quality) assessed by the Canadian
inspector and shown in what was Exhibit A, which
has become Exhibit 10. On that rather more spe
cific accounting, the total calculated by Capt.
Rasmussen was 1,020,470.17 kronor. (This tes
timony is reported at pages 79 through 85 of the
first day's transcript.) Applying the exchange rate
of 7 kronor to $1 Cdn., the value of the seized fish
comes to $145,781.45. This calculation comes to
$1,272.28 more than the medium quality-and-size
calculation earlier mentioned. Both totals are
around between $37,200 and $38,500 less than the
sum asserted in the plaintiffs' statement of claim.
In Exhibit 11 there are shown actual prices
received by the Corporation on invoices dated
between November 1, 1982 and January 31, 1983.
This surely is the best evidence of market prices
obtained for "wetsalted codfish" at various ports
in Newfoundland, taken on Portuguese vessels, at
the material times. The prices written in red ink on
those invoices comprising Exhibit 11, were placed
there by Mr. Wheeler of the Saltfish Corporation.
The fish taken from the Bordoyarnes was, in the
state it was offloaded, "wetsalted cod" of the kind
shown in Exhibit 11. According to the inspection
report, Exhibit 12, confirmed by the inspection
officer, Ralph Randell, who testified, the load of
the plaintiffs' fish was graded as 12% choice qual
ity and 88% standard quality. These totals diverge
from the 18,584 lbs. of choice quality and the
135,216 lbs. of standard quality reported in Exhib
it 10, the Canadian Saltfish Corporation's account
with the Crown Assets Disposal Corporation.
However, since Exhibit 10 reports the sizes in
specific detail, it is accepted as the best evidence
upon which calculations can be made.
Mr. Randell's report of December 7, 1982,
Exhibit 9, indicates clearly the state of the plain
tiffs' fish as it was removed prematurely from the
hold of the Bordoyarnes, since it was only a short
time in salt, not fully struck and naturally soft,
limp and containing moisture. Those attributes are
not to be levied against the plaintiffs for they
would not have disturbed their fish in early
November, 1982. Although there was much con
fusing testimony on the subject right-hand and
left-hand splitting of each fish, in the end, nothing
turns on it. The plaintiffs are entitled to recover
the best prices for each grade and size which Her
Majesty obtained at the material times on the
market. Their fish, by operation of law, became
Her Majesty's property and so the best prices
obtained for such property should, in terms of the
Crown's equitable obligation to the plaintiffs, be
credited to the plaintiffs.
The plaintiffs' counsel in his written submis
sions, drew such best prices per pound from the
invoices in Exhibit 11, thus:
choice large... $1.26
choice medium... $1.04
choice small... $0.86
standard large ... $1.16
standard medium ... $0.94
standard small ... $0.75
Application of the weights shown in Exhibit 10, to
the best prices per pound revealed in the invoices
in Exhibit 11, produces the following calculation:
choice large ... 2,125 lbs. x 1.26... $ 2,677.50
choice medium ... 13,912 lbs. x 1.04... 14,468.48
choice small ... 2,547 lbs. x 0.86... 2,190.42
standard large ... 12,594 lbs. x 1.16... 14,609.04
standard medium ... 94,455 lbs. x 0.94... 88,898.70
standard small ... 28,167 lbs. x 0.75... 21,125.25
153,800 lbs. $143,858.39
TOTAL
The Court finds that the total sum of
$143,858.39 is the full monetary value of the
saltfish as and when removed from the plaintiffs'
ship. This is the correct compensation to which
they are entitled for the taking and conversion by
sale of their fish. Of this sum they have already
received $51,394.57, leaving due to them
$92,463.82.
The defendants having refused to pay the full
sum, the balance of $92,463.82 is the correct
measure of the plaintiffs' special damages for the
defendants' tortious withholding of the balance.
This action, after all, does appear to sound in
tort. The defendants' assert that the plaintiffs'
remedy is provided by subsection 6(9) of the Act
and, it being a statutory remedy which they have
accommodated by their alleged compliance with
the Act, there is no question of, or room for,
liability in tort. This posture of the defendants' is
invalid for several reasons.
The first reason is that the statute itself makes
no provision for the exclusivity of the remedy that
"the proceeds [of sale] shall be paid to the person
from whom the ... goods were taken".
The second reason gives point and purpose to
the first. It is that the proceeds being possibly
inadequate to compensate the person entitled
thereto for the loss, possibly little more than the
product of a virtual give-away (as in the McRae
case supra), the person affected could be unjustly
inflicted with a great loss or just some loss, if he or
she had to accept whatever "proceeds" were paid
over, without recourse to full compensation. With
out precise and apt language to effect such an
unjust prospect in the legislation, Parliament
cannot be understood to have intended to wreak
such injustice on persons whose goods have been
taken. Indeed, in light of paragraph 1(a) of the
Canadian Bill of Rights, R.S.C. 1970, Appendix
III, one must construe subsection 6(9) of the
Coastal Fisheries Protection Act so as to accord to
the plaintiff Rasmussen at least, "the right ... to
... enjoyment of property, and the right not to be
deprived thereof except by due process of law".
The tort of conversion of property is precisely the
wrongful deprivation of a person's enjoyment of
property, and conversion by sale exacts the remedy
of full, fair compensation for the property which
can no longer be traced and restored. When the.
state converts property by sale pursuant to legisla
tion it is no longer .a purely private matter and the
Bill of Rights is engaged. There is no declaratory
Act of Parliament to the effect that subsection
6(9) of the Coastal Fisheries Protection Act shall
operate notwithstanding the Canadian Bill of
Rights, as provided in section 2 thereof.
The third reason, especially in circumstances
where the seized property is converted by opera
tion of law, the Sailfish Act, into the property of
the Crown, is that Parliament cannot be under
stood to permit the Crown to gain an unjust
enrichment without having to account for it. The
fourth reason resides in the very enactment of the
Crown Liability Act, whereby the Crown, the
fount of justice, is made to assume responsibility
for the tortious acts of its servants, without any
petition of right or fiat.
For these reasons, it is apparent that the plain
tiffs are not held to have to make do with whatever
sum the Crown chooses to pay as proceeds, pursu
ant to subsection 6(9) of the Coastal Fisheries
Protection Act. In declining to market the plain
tiffs' fish by the calling for tenders, in appropriat
ing that fish to the property of the Crown itself, in
selling the fish to the Crown's profit, in refusing to
compensate the plaintiffs by payment of the full
market value of the fish and by unjustly retaining
the enrichment of that profit, the Crown is liable
for the tort of wrongful conversion by sale of the
plaintiffs' property.
Special damages have been assessed above. The
plaintiffs also claimed general damages but no
evidence was led in support of this claim. It may
have been an inconvenience to the master and crew
of the Bordoyarnes to continue their fishing opera
tions in the shorter daylight of November in the
Labrador Sea, in order to return home with a full
hold, but such can hardly be quantified into an
award of general damages without some support
ing evidence. No doubt extra costs for food fuel
and salt were incurred, and might have been
included in special damages, if quantified. There
will, therefore, be no award of general damages.
The plaintiffs also claim punitive damages.
However, having limited their claim to one of
tortious conversion by sale, they have an adequate
remedy, and the measure of their damages, in their
award of special damages. After all, the defend
ants did not behave arbitrarily or maliciously, nor
even turn them out with nothing. The plaintiffs'
earlier noted admissions of the defendants' ser
vants good faith are relevant. The Act empowers
seizure of not only the whole catch of fish, but also
even the vessel itself. The defendants wisely for
bore. Moreover, the defendants extended the plain
tiffs licence term so that the plaintiffs could
recoup the loss of the seizure though exploiting an
extended time for continued fishing operation.
Such a gesture can hardly be characterized as
oppressive. No sound basis is presented here for
the award of punitive damages.
The plaintiffs also claim interest:
... on the sum of $51,394.57 from November 12th, 1982 to
May 24th, 1984, and further interest on such amount as may
be awarded by this Honourable Court from November 12th,
1982.
This is a claim for pre-judgment interest. Sections
35 and 40 of the Federal Court Act, R.S.C. 1970
(2nd Supp.), c. 10, bear on the matter of judgment
interest. Section 35 prohibits an award of interest
on any claim against the Crown "in the absence of
any contract stipulating for payment of such inter
est or of a statute providing in such case for the
payment of interest by the Crown." No contract
figures in these proceedings. However, by subsec
tion 3(1) of the Crown Liability Act, "The Crown
is liable in tort for the damages for which, if it
were a private person of full age and capacity, it
would be liable". [Emphasis added.] This is an
applicable statute. By virtue of it, pre-judgment
interest may be awarded against the Crown in tort
actions where such interest would be payable by a
private person of full age and capacity, according
to the law of the province which contemplates the
trials of such actions. This is the reasoning
expressed by the Appeal Division of this Court in
Marshall v. Canada (1985), 60 N.R. 180. The
liability here is governed by the law of Newfound-
land, where the tort was carried out.
The Legislature of Newfoundland has made
statutory provision for pre-judgment interest in
The Judgment Interest Act, S.N. 1983, c. 81.
which was accorded Royal Assent on December
21, 1983 and which was proclaimed to come intc
force on April 2nd, 1984, pursuant to Newfound-
land Regulation 63/84. The first question for
determination is whether or not that Act applies in
these circumstances. In that regard section 10 is
pertinent. It provides:
10. This Act does not apply to a cause of action that arises
before the coming into force of this Act, or to a judgment debt
payable before the coming into force of this Act. [Emphasis
added.]
When did the plaintiffs' cause of action arise?
As the Court has already held, the tort of conver
sion of the plaintiffs' property was committed
when the defendants' declined to pay over to the
plaintiffs the full monetary value of the plaintiffs'
property and thereby wrongfully appropriated to
Her Majesty the unpaid balance of such monetary
value. According to subsection 6(9) of the Coastal
Fisheries Protection Act, the defendants' liability
to pay over that full value could not arise until
"the final conclusion of the proceedings" instituted
"in respect of the offence". That conclusion of the
proceedings occurred only upon the ending of all
appeal proceedings, as was decided by the
Supreme Court of Canada in Leblanc et al. v.
Curbera, [1983] 2 S.C.R. 28, at pages 32-33.
The plaintiffs' cause of action could therefore
not arise before the Crown abandoned its appeal
(Exhibit 7) on March 22, 1984. The plaintiffs
concede to the defendants some days, if not weeks,
of grace within which to decide how much had to
be paid and to requisition payment by cheque.
There is no evidence before the Court of any
definitive assertion by the defendants of their
refusal to pay the full value of the plaintiffs' fish.
However, the date upon which the plaintiffs' solici
tors received the defendants' cheque for
$51,394.57 (Exhibit 8) was May 25, 1984. This
sum, the defendants plead, is full and final pay
ment to the plaintiffs and therefore the date of its
reception by them is the date when the defendants
committed the tort of wrongful conversion by sale
of the plaintiffs' fish. The plaintiffs' cause of
action arose then on May 26, 1984. That is after
the coming into force of The Judgment Interest
Act which accordingly applies in the instant case.
The Act directs the Court, in subsection 3(1), to
award interest on every "judgment for the pay
ment of money or a judgment that money is owing
. on the judgment calculated in accordance with
this Act." The commencement of the running of
interest is not from the date on which the plaintiff
notifies the defendant of the claim, or otherwise
asserts it, but rather, according to the general
direction of subsection 4(1), "the court shall ...
calculate interest under this Act from the day the
cause of action arises to the day of judgment at the
rate determined by averaging the interest rates in
effect during that period." So be it. The plaintiffs'
counsel alleges that the rate has always, pursuant
to the regulations, remained constant at 9% per
annum. In any event, pre-judgment interest is
awarded in accordance with the provisions of The
Judgment Interest Act and regulations.
The Newfoundland interest statute is displaced
however in regard to interest payable on the judg
ment award itself, for section 40 of the Federal
Court Act provides that a judgment, including a
judgment against the Crown, bears interest from
the time of pronouncement at the rate prescribed
by section 3 of the Interest Act [R.S.C. 1970, c.
I-18].
The plaintiffs' counsel made a remarkable writ
ten submission after the trial, as follows:
From the Plaintiffs' perspective, the Plaintiffs have been
deprived of the use of this money and general damages, that is
damages which are presumed by the law as the natural conse
quence of an action, have resulted therefrom. The Plaintiffs
request leave to amend the Statement of Claim to claim these
special damages.
The sense of the request does not leap directly
from the page here. As earlier indicated, no evi-
dence was tendered to support the quantification
or consequent award of general damages herein.
Also, as indicated earlier herein, the Court is
indeed awarding special damages in the amount of
$92,463.82 to the plaintiffs. No leave will be given
to amend the statement of claim as requested.
It remains only to deal with costs which will
naturally follow the event in this case. The plain
tiffs' counsel asks for costs on the scale of "a
solicitor and his or her own client". He also asks to
be permitted to recoup the costs awarded against
the plaintiffs in the case of Rasmussen v. Breau,
above mentioned. Needless to emphasize, the
defendants' counsel opposes such a plea. This has,
no doubt, been a long and difficult litigation but
not inordinately so. One aspect of the case has
been somewhat extraordinary and that is the dis
tances which the plaintiff, Capt. Rasmussen has
had to travel. He has needed the advice of his own
lawyer from the Faroes, too, not only for advice in
law but also to help him cope with litigation
carried out in a language of which he possesses
only imperfect command. The plaintiffs should
therefore be compensated for their disbursement of
those travel expenses necessarily incurred in, and
necessarily incidental to, the plaintiffs' prosecution
of their action. Included are such travel expenses
incurred by, or for, Mr. Tormodur Djurhuus, who
attended at the trial of this action in St. John's. If
actual receipts or airline tickets, and hotel bills or
taxi and meal receipts cannot all now be found and
tendered, the parties' respective solicitors or, ulti
mately the taxing officer may take notice of air
fares, hotel rates and the like which were generally
in effect at the material times, in order to quantify
such disbursements.
Costs will be taxed according to the Court's
tariff currently in force, unless the respective
solicitors come to an agreement which shall settle
costs. The plaintiffs' counsel does not persuade the
Court to include the earlier costs awarded against
the plaintiffs', nor to award costs on the scale
which he advocates. The case presented certain
difficulties, to be sure, as was noted by the Court
at trial's end. It could well be that the plaintiffs'
solicitors and counsel were therefore quite justified
in exploring avenues which ultimately were not on
the critical path from assertion of claim to judg
ment. Accordingly in the exercise of the Court's
discretion, the plaintiffs may recover 130% of all
taxed solicitors and counsel fees prescribed by the
Court's current tariff and the same shall be shown,
either with the 30% added, or at 130% in the taxed
and certified bill of costs. The Court suggests that
payment be made in trust to the plaintiffs' solici
tors upon condition of their giving their indemnity
and the plaintiffs' release in a form approved by
the defendants' solicitors before disbursement by
the plaintiffs' solicitors.
In accordance with Rule 337(2)(b) [Federal
Court Rules, C_R.C., c. 663] the Court directs the
plaintiffs' solicitors to prepare a draft of an appro
priate judgment to implement the Court's conclu
sions, and to seek approval at least as to the form
of it from the defendants' solicitors, before moving
for judgment accordingly. Endorsement of the
defendants' solicitors approval as to form will obvi
ate most formalities in having judgment entered.
The respective parties' solicitors and counsel may,
in writing, and upon notification to each other,
seek clarification of any perceived ambiguities
herein.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.