Nothing in Rules of Civil Procedure or caselaw impose prima facie obligation on party in possession

Civil Practice and Procedure - Preservation of property rights pending litigation - Interim preservation of property

Plaintiff was vehicle manufacturer that apparently had arrangement with defendant for shipping and/or storage of vehicles. During severe weather events in Nova Scotia, some 2,966 vehicles that were apparently in defendant’s possession were allegedly rendered not roadworthy and allegedly could not be found to be roadworthy without undergoing destructive testing. Plaintiff was storing vehicles at three locations but wished to destroy them, and commenced action against defendant for damages for negligence and breach of contract. Defendant brought motion for preservation order, which was granted on basis that defendant either take physical possession of vehicles or assume costs of storage. Defendant successfully appealed, with result that plaintiff was required to preserve vehicles and bear cost of preservation. Appeal judge found that Master erred by failing to take into account plaintiff’s prima facie obligation to preserve property that was subject matter of litigation. Plaintiff appealed. Appeal allowed. Appeal judge erred in law by basing balance of convenience analysis on erroneous presumption that party in possession had prima facie obligation to preserve evidence, and substituting her exercise of discretion for Master’s exercise of discretion on that basis. There was nothing in Rules of Civil Procedure or in caselaw that imposed prima facie obligation on party in possession to preserve evidence . Creation of prima facie obligation to preserve evidence would require party in possession of property to seek permission before repairing, altering, or destroying any property that could have been subject matter of litigation, and could run counter to plaintiff’s duty to mitigate damages. Appeal judge’s order was set aside and Master’s order was restored.

BMW Canada Inc. v. Autoport Limited (2019), 2019 CarswellOnt 11543, 2019 ONSC 4299, N.L. Backhouse J., R.E. Charney J., and L.G. Favreau J. (Ont. Div. Ct.); reversed (2018), 2018 CarswellOnt 11400, 2018 ONSC 4208, Carole J. Brown J. (Ont. S.C.J.).

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