Gerald Foisy and Shirley Rosette were passengers on the ferry Queen of the North. On 22 March 2006, the ferry ran aground and subsequently sank. Foisy and Rosette were presumed dead pursuant to the Survivorship and Presumption of Death Act, RSBC 1996, c 444. The executors of the estate, Sharan and Glenn McDonald, claimed damages against British Columbia Ferry Services Inc (the defendant) on behalf of the dependants of Foisy and Rosette pursuant to the Marine Liability Act, SC 2001, c 6 (the Act). In addition to their claim for general damages, the plaintiffs claimed punitive and aggravated damages.

The defendant admitted liability for the incident, but claimed the benefit of the limitation of liability provided in the Athens Convention relating to the Carriage of Passengers and their Luggage by Sea 1974 (Athens Convention 1974). In addition, the defendant sought a declaration that punitive and aggravated damages were not recoverable as a matter of law in a fatal accident claim governed by the Act.

Held: The defendant’s application is allowed.

Article 3.1 of the Athens Convention 1974, which was given the force of law by Sch 2, Pt 1 of the Act, provides:

The carrier shall be liable for the damage suffered as a result of the death of or personal injury to a passenger and the loss of or damage to luggage if the incident which caused the damage so suffered occurred in the course of the carriage and was due to the fault or neglect of the carrier or of his servants or agents acting within the scope of their employment.

Article 14 of the Athens Convention 1974 provides:

No action for damages for the death of or personal injury to a passenger, or for the loss of or damage to luggage, shall be brought against a carrier or performing carrier otherwise than in accordance with this Convention.

First, it is clear that punitive or exemplary damages are not compensatory in nature. Their purpose is to punish wrongdoers and deter others from acting in the same manner. Article 3 of the Athens Convention 1974 provides that 'the carrier shall be liable for the damage suffered as a result of the death of or personal injury to a passenger'. Section 6 of the Act then defines damages of a dependant as 'loss resulting from the injury' and 'loss resulting from the death' of a passenger. Article 14 of the Convention operates to confine the action within the Convention. The wording of the legislation clearly indicates that damages to be awarded under the Act and Athens Convention 1974 are to be compensatory in nature. Where the claim falls under the Act and the Athens Convention 1974, as these claims do, the provisions of the legislation did not permit the recovery of punitive or exemplary damages, which are not in the nature of compensation.

Second, aggravated damages are compensatory in nature and are awarded in circumstances where the defendant’s conduct has been particularly high-handed or oppressive, thereby increasing the plaintiff's mental distress. Aggravated damages are non-pecuniary damages. Under s 6(2) of the Act, the dependants' recovery with regard to the wrongful deaths is for 'loss resulting from the death' of a passenger. In addition, under art 3 of the Athens Convention 1974, the liability of the carrier is for 'damage suffered as a result of the death … of a passenger'. However, the Act does not go further to provide or permit the recovery of non-pecuniary damages in the nature of punitive, exemplary or aggravated damages.

The plaintiffs submit that the Act and the Convention leave a gap in not providing for aggravated and punitive damages, and that this gap should be filled by relying on maritime common law. Alternatively, they submit that the Court should engage in judicial reform of maritime law to extend the scope of damages to permit recovery of punitive and aggravated damages.

The plaintiffs rely principally on the decision in Ordon Estate v Grail, [1998] CanLII 771 (SCC), [1998] 3 SCR 437, (1988) 166 DLR (4th) 193 (CMI971) in support of their submissions. In the present case, the plaintiffs do not seek to rely on provincial legislation. Instead, they rely on the analysis of the Supreme Court regarding the potential for judicial reform of maritime law. The plaintiffs suggest that there is a 'gap' in the statutory provisions governing dependants' claims but that maritime common law fills the gap and provides for the right to recover punitive and aggravated damages.

There is no evidence that punitive and aggravated damages form part of Canadian maritime common law. The plaintiffs submit that this Court should then reform Canadian maritime common law to provide for punitive and aggravated damages using the approach set out in Ordon. However, as Ordon made clear, the uniformity of maritime law is particularly pressing in actions for tortious liability. In undertaking judicial reform in an area of law that is the product of international treaties, courts must consider the effects of the change on the state of international maritime law. The Court has not been presented with a sufficient basis upon which to reform Canadian maritime law in the manner put forward by the plaintiffs.

In summary, the dependants' claims in these actions fall exclusively under the Act and the Athens Convention 1974. There is no ability under the statute and Convention for a dependant of a deceased passenger to recover punitive, exemplary or aggravated damages. Such damages are not recoverable under maritime common law applicable in Canada. This Court should not engage in judicial reform of Canadian maritime law to expand the scope of recovery to include such damages. If such reform is warranted, it must come from Parliament.