+ RMA Rural Municipalities
of Alberta

Resolution 22-15F

Amendment to the Municipal Government Act Regarding Joint and Several Liability

Date:
November 26, 2015
Expiry Date:
November 30, 2018
Active Status:
Expired
Sponsors:
Strathcona County,
MD of Willow Creek
District:
1 - Foothills-Little Bow
Year:
2015
Convention:
Fall
Category:
Municipal Governance and Finances
Status:
Intent Not Met
Vote Results:
Carried
Preamble:

WHEREAS most Canadian jurisdictions, including Alberta, have adopted a joint and several liability regime; and

WHEREAS under this regime, when a plaintiff suffers damage on account of the separate wrongful acts of two or more defendants, each defendant is considered to be 100 percent liable to the plaintiff for all of the damage suffered; and

WHEREAS the plaintiff is entitled to recover all of his/her damages from any particular defendant, regardless of that defendant’s particular share of fault;

Operative Clause:

THEREFORE BE IT RESOLVED that the Alberta Association of Municipal Districts and Counties lobby the Government of Alberta to amend the Municipal Government Act to reflect one of the following regimes:

  1. a system of pure proportionate liability; or
  2. limit joint and several liability to only certain types of losses; or
  3. limit joint and several liability to defendants whose fault exceeds a specified threshold or;
  4. eliminate joint and several liability where the plaintiff is contributory negligent.
Member Background:

Canadian jurisdictions have adopted a joint and several liability regime where regardless of the amount of liability assigned (example: Joe Citizen is 70% liable and Municipality of Good Town is 30% liable), the plaintiff is entitled to recover all of his damages from one of the defendants, leaving that defendant to have to seek contribution from the co-defendant for the amount paid to the plaintiff in excess of the proportionate share of fault.

This is illustrated by the scenario in which a plaintiff obtains a judgement against two defendants, defendant A and defendant B.  If defendant A is found to be 70 percent at fault, and defendant B is found to be 30 percent at fault, the plaintiff would nevertheless have the right to recoup 100 percent of the damages from defendant B.  Defendant B would then be entitled to receive contribution from defendant A for an amount equal to 70% of the plaintiff’s damages.

The purpose of the joint and several liability rule is to reduce the probability that plaintiffs will fail to receive compensation for their losses when a defendant is unable to shoulder its proportionate share of the plaintiff’s damages, by transferring that share to the remaining defendant so as to not deny the plaintiff adequate redress.

The rationale of joint and several liability appears laudable but the regime is flawed, because while the system effectively assists victims in obtaining full compensation for their losses, it is done at the expense of so-called “deep pocket” entities such as municipalities.  Municipalities routinely incur liability alongside insolvent defendants unable to pay their share of damages.  In these circumstances, the rule of joint and several liability requires municipalities to shoulder all or substantially all of the plaintiff’s damages, without any recourse against the other at fault party.  The unfairness of this is aggravated by the fact that municipalities are often secondarily liable, but find themselves contributing to the plaintiff’s judgement in an amount far in excess of their proportionate share.

Given the increasing burden on municipalities and their taxpayers, we recommend taking steps to provide for municipal exceptions that would be part of any legislative reform to the MGA.

RMA Background:

The AAMDC has no active resolutions directly related to this issue.

Government Response:

Municipal Affairs: The Government of Alberta is undertaking a comprehensive review of the Municipal Government Act (MGA).

Alberta Municipal Affairs (MA) committed to working with other ministry partners to determine what issues should be considered through the current review of the MGA. Based on discussions with Alberta Justice and Solicitor General, MA has determined that joint and several liability policy would be best reviewed in a broader, more holistic context and is not appropriately addressed through the MGA.

MA encourages the Alberta Association of Municipal Districts and Counties to work with Alberta Justice and Solicitor General on any future review of the liability system in Alberta.

Development:

In Bill 21: Modernized Municipal Government Act, no changes were made to joint and several liability. When addressed to the province though Alberta Municipal Affairs, Alberta Municipal Affairs indicated that this issue would be best addressed through Alberta Justice and Solicitor General but there has been no indication of further progress on this issue. This resolution will be assigned a status of Intent Not Met.

Provincial Ministries:
Municipal Affairs
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