Mainroad Howe Sound Contracting Ltd was under contract to Her Majesty the Queen in the Right of the Province of British Columbia, represented by the Minister of Transportation and Infrastructure, to provide highway maintenance services for designated provincial roadways. One of those roadways was the Pemberton Meadows Road, which lies adjacent to the bank of the Lillooet River in several areas north of Pemberton. The plaintiff, Francesca Knight, was a habitat biologist for the Department of Fisheries and Oceans. In July 2011, she expressed concerns over the approach taken to protect the roadway from bank erosion. The parties agreed to conduct reconnaissance to identify the riverbank erosion sites that would require emergency works. Mr Black agreed to transport individuals on the river in his boat for the purposes of the reconnaissance trip for payment of CAD 200 per hour. On the way back from the reconnaissance trip, the boat struck a sandbar or some other object in the river. The plaintiff alleges that she sustained significant injuries as a result of the impact.

The issue to be decided is whether the defendants' liability for those injuries is limited by Pt 4 of the Marine Liability Act, SC 2001, c 6 (the Act), which incorporates the limitation of liability in the Athens Convention 1974 (the Convention).

Held: Section 37(2)(a) of the Act applies arts 1-22 of the Convention to this case; and, in the alternative, none of the exclusions set out in s 37(2)(b) of the Act apply to negate the application of arts 1-22 of the Convention. Accordingly, any liability that may be found against the defendants is limited to 175,000 units of account pursuant to Pt 4 of the Act and arts 1-22 of the Convention.

Liability for injuries sustained by passengers during international carriage by sea is governed by the Convention. Article 3 sets out a regime for the imposition of presumed liability on 'carriers' for damages suffered in the course of carriage that was due to their neglect or fault. Article 18 precludes a carrier from contracting out of that liability. Article 4 provides that a 'performing carrier' is 'subject and entitled to the provisions of [the Convention] for the part of the carriage performed by him'. Article 7 imposes limits on liability for personal injuries. On its own, the Convention applies only to international carriage by water, and Canada has not formally ratified the Convention. However, through Pt 4 of the Act, Canada has adopted arts 1-22 of the Convention into national law, with certain modifications.

Section 37(1) of the Act provides that arts 1-22 of the Convention have the force of law in Canada. Section 37(2) extends the Convention's application to:

(a) the carriage by water, under a contract of carriage, of passengers or of passengers and their luggage from one place in Canada to the same or another place in Canada, either directly or by way of a place outside Canada; and

(b) the carriage by water, otherwise than under a contract of carriage, of persons or persons and their luggage, excluding

(i) the master of a ship, a member of the ship’s crew or any other person employed or engaged in any capacity on board a ship on the business of the ship,

(ii) a person carried on board a ship other than a ship operated for a commercial or public purpose;

(iii) a person carried on board a ship in pursuance of the obligation on the master to carry shipwrecked, distressed or other persons or by reason of any circumstances that neither the master nor the owner could have prevented, and

(iv) a stowaway, a trespasser or any other person who board a ship without the consent or knowledge of the master or the owner.

[Emphasis added.]

Other relevant provisions of the Act include:

36(1) For the purposes of this Part and Articles 1 to 22 of [the Convention],

(a) the definition ship in Article 1 of [the Convention] shall be read as including any vessel or craft designed, used or capable of being used solely or partly for navigation, whether seagoing or not ... ; and

(b) in the definition contract of carriage in Article 1 of [the Convention], the expression 'carriage by sea' shall be read as 'carriage by water'.

Together, those provisions of the Act extend the application of arts 1-22 of the Convention, including the limitation provisions set out in art 7, to domestic waters in Canada.

The plaintiff argues that the contract in this case was not a 'contract of carriage', but rather was a charterparty. As such, she argues that the limiting provisions of the Convention do not apply. However, art 1 of the Convention, together with s 36 of the Act, does provide guidance on the interpretation of 'contract of carriage', providing that a 'contract of carriage' is a 'contract made by or on behalf of a carrier for the carriage by [water] of a passenger'. Nothing in the definition excludes an agreement that has the characteristics of what the secondary sources refer to as a charterparty. Under the Convention, the following elements are required for a finding that a 'contract of carriage' exists: (a) a contract (b) made by a 'carrier' (c) for the 'carriage by water' of a (d) 'passenger'. All four of those elements exist in this case.

The plaintiff also submits that to come within the definition of 'passenger', she, being the person being carried on the boat, must be privy to the contract of carriage. She argues that without that contractual nexus, the defendants cannot rely on the provisions of the Act or the Convention to limit their liability for injuries she sustained. The case law does not support her argument. In Cairns v Northern Lighthouse Board [2013] CSOH 22 (Scot) (CMI727), the Northern Lighthouse Board employed Ms Cairns as a finance assistant. As part of her employment duties, she was required to visit lighthouses owned by the employer for audit purposes. Her employer arranged with Calypso Marine Ltd to allow her to travel by boat to one such lighthouse. In the course of that travel, she suffered an injury to her lower back. She sued both the employer and the boat owner. The Scottish Court of Session, Outer House, considered the meaning of 'passenger' in the Athens Convention and, in particular, whether the person making the claim for damages had to be a party to the contract referred to in 'any person carried in a ship under a contract of carriage'. The Court held that they did not.

Therefore, s 37(2)(a) of the Act applies to invoke the application of arts 1-22 of the Convention, including the limitation provisions, to this case.

Even if that conclusion is not correct, and the plaintiff was not transported under a 'contract of carriage', Pt 4 of the Act, and therefore the limitation provisions of the Convention, will nonetheless apply unless she comes within any of the four exclusions set out in s 37(2)(b). The parties agree that neither s 37(2)(b)(iii) nor (iv) have application in this case. Their positions diverge on the issue of whether the exclusions set out in section 37(2)(b)(i) or (ii) apply. The defendants say that the plaintiff was not engaged 'on the business of the ship' and that the boat was operated for a 'commercial purpose'.

The plaintiff argues that the purpose of the boat trip was to complete the reconnaissance survey of the riverbank and that she was on board the ship as a part of that business. That argument conflates the 'business of the ship' with the business of the people on the ship. In this case, the two are not the same. On the plaintiff's broad interpretation, the 'business of the ship' would always be the same as the business of the passengers on the ship. If that were the case, there would be no need to include the words 'on the business of the ship' in section 37(2)(b)(i). The business of the ship was singular and limited: to transport the plaintiff and her colleagues on the river. As the plaintiff was not employed or engaged in that 'business' of transportation, s 37(2)(b)(i) is not invoked so as to relieve her from the limitation provisions of the Athens Convention.

The second exclusion on which the plaintiff relies is contained in s 37(b)(ii) of the Act. That section excludes from the application of the Convention 'a person carried on board a ship other than a ship operated for a commercial or public purpose'. In the normal course, Mr Black did not operate the boat for a commercial purpose. He purchased the boat for pleasure use and had not used the boat for any money-making activity either before or after the accident. Given his use, Mr Black did not insure the boat for commercial purposes. It is also clear that Mr Black was not prepared to provide the transportation for free. The fact that Mr Black otherwise used the boat for non-commercial purposes does not change the commercial nature of the trip that the plaintiff was on. There is no requirement in s 37(2)(b) that the ship be operated for a commercial purpose in the 'usual' course. If Parliament intended that to be the case, it could have easily included words to that effect in the Act. It did not. On the day of the accident, the ship was operated for a commercial purpose. Section 37(2)(b)(ii) does not relieve the plaintiff from the limitation provisions of the Athens Convention.

[For the partially successful appeal to the Court of Appeal for British Columbia, see Knight v Black 2022 BCCA 130 (CMI1815).]