



COURT 
    OF APPEAL FOR BRITISH COLUMBIA




Citation:


Bronson 
          v. Hewitt,







2008 
          BCCA 46



Date: 20080116

Docket: CA035610; CA035611

Between:

Thomas 
    E. Bronson, J. Tom Bronson, Lee B. Lewis,

Virginia 
    C. Shaffer, H. Davis Lewis, Jr. and Harold D. Lewis, Sr.

Appellants

(
Plaintiffs
)

And

Howard 
    H. Hewitt, A. Eugene Lewis, Jennifer Lewis Browning,

Julie 
    Anne Lewis, William David Tompkins, Trustee of the Graham River Trust,

Graham 
    River Outfitters Ltd., Margaret H. Mason, Bull, Housser & Tupper and

Bull, 
    Housser & Tupper LLP

Respondents

(
Defendants
)




Before:


The 
          Honourable Chief Justice Finch




(In 
          Chambers)



Oral Reasons for Judgment




R.R.E. 
          DeFilippi

S.M. 
          Manery


Counsel for the Appellants




B. 
          Johnston


Counsel for the Respondent, H.H. Hewitt




J. 
          Dives


Counsel for the Respondents, E. Lewis, J. Lewis Browning 
          & J.A. Lewis




W.G. 
          MacLeod


Counsel for the Respondents, M.H. Mason; Bull, Housser 
          & Tupper; Bull, Housser & Tupper LLP




Place 
          and Date of Hearing:


Vancouver, British Columbia







14 January 2008




Place 
          and Date of Judgment:


Vancouver, British Columbia







16 January 2008



[1]

FINCH, C.J.B.C
:  The plaintiffs bring two applications for leave 
    to appeal from orders made by Mr. Justice Goepel, the case management judge 
    in these proceedings in the Supreme Court of British Columbia.

[2]

The application in CA035610 is for leave 
    to appeal the order of 27 November 2007 which required the plaintiffs to prepare 
    and deliver a new list of documents in chronological order.  Counsel 
    for the plaintiffs contends that the list of documents already delivered complies 
    with the requirements of Rule 26(1.3), and that the case management judge 
    erred in his interpretation of that rule.  He says the proposed appeal 
    raises an important question of law, and that the proceedings should be stayed 
    pending the hearing of the appeal.

[3]

Counsel for all defendants oppose the 
    application for leave to appeal.  Although the submissions of the three 
    defence counsel differ slightly in detail, they all agree that the judge did 
    not err in his interpretation of the rule, and that the plaintiffs have failed 
    to meet the applicable tests for leave to appeal a discretionary interlocutory 
    order.

[4]

Rule 26(1.3) provides:

Documents 
    to which there is no objection to production must be enumerated in a convenient 
    order and include a short description of each.

[5]

The list of documents, as presented, 
    references 4,497 documents containing some 16,430 pages.  The defendants 
    objection is, in essence, that the documents are not listed in any convenient 
    way, chronological or otherwise, as required by the rule.

[6]

The case management judge set out the 
    facts and the parties positions, and then reviewed the authorities, including 
    the decision of Mr. Justice Lowry, when he sat in the trial court, in
G.W.L. 
    Properties Ltd. v. W.R. Grace & Co. of Canada
(1992), 14 C.P.C. 
    (3d) 74 (B.C.S.C.), leave to appeal refd (1993), 19 C.P.C. (3d) 373 (B.C.C.A.).

[7]

In holding that a chronological list 
    must be provided the case management judge said:

[37]      
    In this case, the defendants, as a starting point, seek a chronological list.  
    The plaintiffs submit that the authorities, as cited above, do not require 
    documents to be listed chronologically.  I accept that a chronological 
    list may not be required if the documents are otherwise listed in a convenient 
    order.  What is required, as noted by Lowry J. in
Grace
, 
    is that the list of documents provides the party seeking discovery with a 
    meaningful, reliable and complete disclosure as well as an effective aid to 
    review the documents produced when an inspection is conducted.

[38]      
    The List does not achieve that standard.  While the disclosure may well 
    be complete, it does not allow for meaningful inspection.  There is neither 
    rhyme nor reason to the List.  The documents are listed in the order 
    they were received in counsels office.  In the course of submissions, 
    one counsel suggested that the organization of the List is no different that 
    if plaintiffs counsel had simply thrown all his documents in the air and 
    then listed them in the order he picked them up from the floor.  That 
    submission, in my view, is not far off the mark.

[39]      
    While a party need not always list documents in chronological order, the documents 
    must be listed in a convenient order.  As noted by Lowry J. in
Grace
, 
    what is required in each case depends on the nature of the documents that 
    must be described and the ingenuity of counsel.  In this case, the documents 
    are not listed in a convenient order and the List does not comply with Rule 
    26(1.3).

[40]      
    I was advised during submissions that the manner in which the List has been 
    prepared allows plaintiffs counsel to produce a chronological list of documents.  
    It simply requires the documents to be sorted by a different field.  
    A chronological list, however, does not in itself resolve the difficulties 
    of the present production.  The documents must be listed in a way that 
    will allow for their orderly inspection.  This will require the individual 
    pages to be renumbered and the separate documents retabbed, all in chronological 
    order.  Privileged and non-privileged documents must be segregated from 
    each other and numbered separately.

[41]      
    Within thirty days of the date of these Reasons, the plaintiffs must prepare 
    and deliver a list of documents in chronological order (the New List).  
    The documents in Part I of the New List must be available for inspection by 
    January 15, 2008.

[8]

The test for leave to appeal from a 
    discretionary interlocutory order is high.  The burden on the applicant 
    is to show an error of principle, a clearly wrong result, or a serious injustice.  
    The test is even more stringent when the order is made by a case management 
    judge, see:
Robak Industries Ltd. v. Gardner
2006 BCCA 
    395 and
Yang v. Yang
2000 BCCA 486.

[9]

A decision closely in point for present 
    purposes is the decision of Mr. Justice Wallace in
G.W.L. Properties
(
supra
) refusing leave to appeal the order of Mr. Justice Lowry.  
    Mr. Justice Wallace said:

10.       
    In
Aylsworth et al. v. Richardson Greenshields of Canada Limited
, 
    [1987] B.C.J. No. 3133, (24
th
December 1987) Vancouver Registry 
    CA008575 I had occasion to make the following observation:

It has been the general practice of this Court respecting appeals from interlocutory 
    orders to not intervene with such order or to substitute its view from that 
    of the trial judge, where such order involve the exercise of the chambers 
    judges discretion and he has applied appropriate legal principles.

. . .

In my view, 
    it would be even less appropriate for this Court to intervene where the discretion 
    exercised by the pre-trial judge is concerned with giving directions incidental 
    to the case-management of complex litigation.  Without attempting to 
    state an exhaustive list of conditions which would justify this Court interfering 
    with an order of a pre-trial judge, it is my opinion that unless such direction 
    finally disposes of a fundamental issue in the lawsuit or contravenes the 
    rules of natural justice this Court would not review the pre-trial judges 
    exercise of his discretion.

11.       
    I consider these remarks particularly applicable to the present case and I 
    would not part from the principles there expressed.

12.       
    In my view the appropriate format to be used with respect to the production 
    and listing of documents in this action is one that is peculiarly within the 
    province of the pre-trial case management judge to decide.  He, with 
    the assistance of counsel for both parties, should have complete discretion 
    to settle the form which such disclosure should take.  I do not consider 
    that any panel of this court would interfere with the exercise of that discretion.  
    Accordingly I dismissed the application.

[10]

I do not consider the proposed appeal 
    of Mr. Justice Goepels order to be significant to the practice in general.  
    What is convenient in a given case must depend on the particular circumstances 
    of that case.  The rule gives a judge a broad discretion to determine 
    what is convenient in the circumstances, bearing in mind that the purpose 
    of discovery of documents is to provide the party seeking discovery with, 
    as Mr. Justice Lowry said in
G.W.L. Properties
:

a meaningful, reliable, and complete disclosure as well as an effective aid 
    to retrieving the documents produced when an inspection is conducted.  
    What is required in each case depends on the nature of the documentation that 
    must be described.

[11]

I see no prospect of success in the 
    proposed appeal.  Additionally, the proposed appeal would hinder the 
    progress of the action and disrupt the schedule for pre-trial proceedings 
    set by the case management judge.

[12]

The application for leave to appeal 
    the order of 27 November 2007 is dismissed.

[13]

The plaintiffs apply in CA035611 for 
    leave to appeal the order of 6 December 2007, which dismissed the plaintiffs 
    application for leave to file an Amended Amended Statement of Claim.  
    The defendant Hewitt opposed the proposed amendment in respect of the claim 
    against him on the basis that it was premature, prejudicial and not necessary 
    to determine the real issue in controversy.

[14]

The case management judge agreed with 
    Hewitts position and refused leave to amend.

[15]

The case management judge described 
    the proposed amendment as follows:

[11]      
    The gist of the contested amendment is that Hewitt, without passing his accounts, 
    has transferred money to himself from the Beneficiaries share of the BNO 
    sale proceeds.  They seek an order that Hewitt pay back such amounts 
    with interest.

[12]      
    Underlying the application is the Beneficiaries belief that Hewitt is using 
    the sale proceeds to pay his legal expenses in this proceeding.  The 
    plaintiffs submit that the pre-taking of legal expenses from trust funds constitutes 
    a breach of trust.  In support of that allegation, they cite
Kozicki 
    Estate v. Kozicki Farms Ltd.,
2004 SKQB 125,
Culbert Estate 
    (Re),
2006 SKQB 454, and
Carter v. Blaney
(1989), 34 
    E.T.R. 299 (B.C.C.A.).  Each of those cases discusses the entitlement 
    of a trustee to be indemnified from trust assets for properly incurred legal 
    expenses.  None of them deals specifically with the issue of whether 
    the trustee has a right to pre-take litigation costs prior to the passing 
    of accounts.

[16]

The substance of the judges reasons 
    refusing leave to amend is found in the following paragraphs:

[17]      
    The real issue in controversy between the plaintiffs and Hewitt concerns Hewitts 
    sale of the BNO shares.  The plaintiffs say Hewitt did not have the authority 
    to sell the shares and in any event sold the shares at an improvident price.  
    The proposed amendment will not assist in determining those issues.

[18]      
    The premise of the proposed amendment is that it is improper to use trust 
    funds to pay for legal expenses prior to the passing of account.  Whether 
    the taking is improper may be contingent upon the Beneficiaries succeeding 
    in their breach of trust suit.  Whether they will do so will not be known 
    until the conclusion of the trial.  Further, even if a breach of trust 
    is found, it remains open to the court to relieve a trustee in certain circumstances 
    of the consequences of that breach:
Linsley v. Kirstiuk
(1986), 28 D.L.R. (4
th
) 495 (B.C.S.C.).

. . .

[20]      
    While
Waters
suggests that it is perfectly proper for a trustee 
    to make payments from trust property to pay expenses, I am prepared to accept 
    for the purpose of this application that the law is not perfectly clear on 
    whether a trustee can use trust funds to defend a proceeding alleging a breach 
    of trust.  This proceeding, however, is not the proper forum to answer 
    that question.  In the context of this trust, the answer to the question 
    may turn on findings that I will make in the course of this litigation.  
    Until those findings are made, the question is not ripe for determination.  
    The proposed amendment is premature.  The question is best answered on 
    a passing of accounts.

[21]      
    To allow the amendment would be unfairly prejudicial to Hewitt.  If the 
    question of his legal fees becomes a live issue in this litigation, his present 
    counsel may possibly become a witness and need to withdraw.  Given the 
    history of this litigation, that would be most unfair.  Hewitt initially 
    retained Bull, Housser & Tupper to defend these proceedings.  The 
    plaintiffs subsequently amended their pleadings and added Bull, Housser & 
    Tupper as a defendant in regards to actions taken by a lawyer in that office 
    in connection with the sale of the trust property.  As a result of being 
    joined as a defendant, Bull, Housser & Tupper withdrew and Hewitt had 
    to retain new counsel, undoubtedly at considerable expense.  It would 
    not be fair or proper that he be again forced to find new counsel because 
    the plaintiffs have now decided to yet again

[17]

This is another discretionary interlocutory 
    order made by a case management judge.  The plaintiffs have failed to 
    persuade me that this discretion was not exercised judicially.  The judge 
    referred to the relevant authorities and principles.  He clearly understood 
    the plaintiffs position.  He assessed the potential prejudice to the 
    parties and he considered the significance of the proposed amendments in the 
    context of the proceedings as a whole.

[18]

I see no prospect of success in the 
    proposed appeal.  I dismiss the application for leave to appeal from 
    the order of 6 December 2007.

The Honourable 
    Chief Justice Finch

CORRECTION  20 February 2008

R.R.E. De Fillippi
 Counsel for the Appellants should be R.R.E. DeFilippi


