This is an appeal from a judgment at trial awarding general and exemplary damages to the plaintiff for trespass [1987 CanLII 2455 (BC SC), 18 B.C.L.R. (2d) 328, 45 C.C.L.T. 137, 45 D.L.R. (4th) 559]. This appeal is brought in respect of the award of exemplary damages only. The plaintiff, who is the appellant, contends that the award for exemplary damages was inordinately low, and that the trial judge overlooked factors that she ought to have taken into consideration in making that award.

[2] The plaintiff, Mr. Austin, is the registered owner of lands and premises situate in White Rock, British Columbia. The defendants were engaged in building a complex adjacent to a portion of Mr. Austin's property. The construction was taking place during 1985.

[3] The trespass took the form of the installation of between 35 and 39 steel rods, referred to as anchor rods, being inserted into the ground below the surface of Mr. Austin's property as part of the shoring system utilized in the excavation for the foundation of the complex. The rods were inserted under Mr. Austin's property in September 1985 without his permission.

[4] Mr. Wightman, an officer of the defendant companies, stated that he had attended at Mr. Austin's home on several occasions and not finding anyone home left his business card on more than one occasion. Mr. Austin acknowledged that he did find on one occasion a business card accompanied by a note asking he telephone Mr. Wightman. Mr. Austin did not telephone Mr. Wightman.

[5] The trial judge concluded that Mr. Wightman's efforts to contact the plaintiff before proceeding with the excavation were far too casual to constitute a genuine effort to obtain permission to enter onto the plaintiff's land. They were not sufficient to meet the allegation that he treated the plaintiff in a high-handed manner, and it was on that basis that the plaintiff was held to be entitled to an award of exemplary damages.

[6] One evening of September 1985 Mr. Austin was sitting in his home when he felt his house vibrate and concluded that anchors were being inserted under the house. He and his solicitor attended at the office of Mr. Wightman the next day to discuss the matter. No permission was then granted, and it was Mr. Austin's understanding at that time that the insertion of the rods had been completed.

[7] At trial, expert evidence was given as to the pecuniary benefit to the defendants by installing anchor rods on Mr. Austin's land. If the trespass had not occurred, and if permission had not been obtained from Mr. Austin to insert the rods in his land, an alternative method of a soldier pile would have been necessary to complete the excavation. The soldier pile method would not have necessitated trespassing upon Mr. Austin's land.

[8] A Mr. Trowbridge, an engineer called to give evidence at trial, estimated a cost saving to the defendants by using the anchor rods of over $30,000.

[9] Mr. Harrington, another engineer called by the plaintiff at trial, estimated a saving of some $28,000, while there was other evidence indicating that the use of the rods had resulted in a saving of about $21,000 to $22,000. It would appear from the reasons for judgment that the trial judge accepted that the latter figure was at least the saving made by the defendants.

[10] The trial judge awarded $500 as general damages and $7,500 as exemplary damages. In making those awards the trial judge concluded that there was nominal damage done to the plaintiff's property as there was no surface damage to the property aside from some nail marks in a few trees on the boundary of the property, and the surface soil was undisturbed.

[11] In dealing with the matter of exemplary damages, the trial judge said this [p. 339]:

In making its determination on this issue, the court has to weigh the rights of a landowner to preserve the integrity of his land against unlawful interference, against the potential problems which could be created by awards of damages which would make it profitable for landowners to hold their building neighbours to ransom. Although the defendants here must be taught that they cannot proceed with their own projects without regard for their neighbour, so must landowners in the position of the plaintiff be encouraged to make reasonable arrangements with their neighbour for interferences with their property which do not result in damage to their property or significant inconvenience to themselves. Wrongdoing must be deterred, but cooperation must be encouraged, particularly in an urban setting where construction and expansion are a fact of life.

[12] In my opinion, that is a novel proposition unsupported by authority. I regard it as flying in the face of authority which holds that a landowner in occupation is entitled to refuse permission to enter upon his property for any purpose and that if he refuses to do so the applicant for permission is not thereafter entitled to enter upon the property, trespass, and then contend that the landowner was unreasonable in refusing permission.

[13] I regard that passage as an error in principle by the trial judge. As a result of that error in principle the trial judge disregarded the expert evidence as to the saving that had been effected by the defendants in trespassing upon the property of Mr. Austin and then proceeded to award damages $7,500. In doing so the trial judge made reference to an unreported decision of this court in Vancouver Block Ltd. v. Empire Realty Co., B.C.C.A., Vancouver No. CA780018, 19th June 1979.

[14] She observed that Mr. Justice Carrothers, who gave the majority judgment, had referred with approval to the decision of Mr. Justice Brooke in Pretu v. Donald Tidey Co., 1965 CanLII 286 (ON SC), [1966] 1 O.R. 191, 53 D.L.R. (2d) 504 (H.C.). Mr. Justice Brooke, at pp. 508-509, said:

When may exemplary or punitive damages be awarded? In actions for damages for tort, the Court may take into account matter of aggravation and may award exemplary damages where the conduct of the defendant has been malicious or high-handed. See Jenks' Digest of English Civil Law, 2nd ed., p. 370.

Carr-Harris v. Schacter and Seaton, 1956 CanLII 131 (ON SC), [1956] O.R. 994, 6 D.L.R. (2d) 225, was an action in which an owner-contractor was held liable for trespass upon the lands of his neighbour, the trespass arising in the course of the construction of a new building. In his judgment, Wilson, J., reviewed the authorities on the question of damages for trespass and he held that the trespass there was deliberate and done with the knowledge that it would damage the plaintiff's property, and that there was in the defendant's conduct a degree of culpability which carried with it a penalty in the form of damages.

The judgment referred to was followed by Ferguson, J., in Starkman et al. v. Delhi Court Ltd and Diamond & Mogil Builders Ltd. (1960), 1960 CanLII 413 (ON SC), 24 D.L.R. (2d) 152, which judgment was affirmed by the Court of Appeal for Ontario, 1961 CanLII 195 (ON CA), [1961] O.R. 467, 28 D.L.R. (2d) 269.

In my opinion, the conduct of the defendant in this case is such as entitles the plaintiffs to punitive damages.

In delivering the judgment of the Court of Appeal for Ontario in Starkman et al. v. Delhi Court Ltd. and Diamond & Mogil Builders Ltd., McGillivray, J.A., concurred with the view of the trial Judge that a nominal amount added to the actual damages in such a case would be but an invitation to contractors to violate property rights, for what would amount to an insignificant licence fee and that a substantial amount for punitive damages should be added to the actual damage suffered by the plaintiff.

In Merest v. Harvey (1814), 5 Taunt. 442 at p. 443, 128 E.R. 761, Gibbs C.J., stated:

"I wish to know, in a case where a man disregards every principle which actuates the conduct of gentlemen, what is to restrain him except large damages?"

Damages must be relative to the facts of the case. In assessing damages to be awarded to the plaintiffs, I have considered all of the evidence led before me, including the evidence as to the value of the plaintiff's property and the interest that they had in retaining that property. I think the damages should be sufficient so they will be a deterrent and all will know that it will not be profitable to trespass upon the lands of another, and the amount to be added to the damages for the loss suffered by the plaintiffs should be substantial.

[15] As I say, Mr. Justice Carrothers quoted that passage from the judgment of Mr. Justice Brooke in the Vancouver Block case. He also referred to what was said by Lord Devlin in Rookes v. Barnard, [1964] A.C. 1129, [1964] 2 W.L.R. 269, [1964] 1 All E.R. 367 (H.L.), per Lord Devlin at p. 1227. In his speech Lord Devlin said:

Exemplary damages can properly be awarded whenever it is necessary to teach a wrongdoer that tort does not pay.

[16] The law on this subject is summed up by McGregor on Damages, 14th ed. (1980), p. 242, as follows:

Thus if a defendant's unjust enrichment is to be prevented, awards should not be moderate or indeed immoderate, but should be geared to the profit obtained or obtainable by the defendant...

[17] Upon the basis of those authorities as I have indicated, in my opinion, the trial judge erred in her approach to the assessment of damages as a matter of principle and arrived at an award that was inordinately low. She rejected the profit that had been effected by the defendants in trespassing on the plaintiff's land. Taking the profit into account as a factor in awarding exemplary damages, it seems to me that a proper award in the circumstances I have outlined would have been $30,000 for exemplary damages.

[18] I would allow the appeal on that first ground and substitute that figure for the figure awarded by the trial judge.

[19] There is a second issue and that deals with the matter of costs. The trial judge held that the fee of Mr. Trowbridge, who was called as an expert by the plaintiff, should be disallowed because she regarded his evidence and report as unnecessary and irrelevant.

[20] A trial judge does have a discretion under the Supreme Court Act with respect to costs, but that discretion must be exercised upon proper grounds.

[21] Here, in my opinion, because of the error in the approach adopted by the trial judge to the award of exemplary damages, she based her view of Mr. Trowbridge's report and evidence on a misconception as to the relevance of that evidence, and it was on that basis that she disallowed his fee as a proper fee in the circumstances.

[22] Again, I conclude that she erred in reaching that decision. I would allow the appeal on that second ground as well.

[23] For those reasons, I would allow the appeal.

[24] MACDONALD J.A.: I agree.

[25] SEATON J.A.: I agree. The appeal is allowed. Exemplary damages are increased to $30,000 and the plaintiff is to have the costs of Trowbridge and, of course, the costs of the appeal.

Appeal allowed.

Questions:

1. its path through the court system;

2. the relevant facts;

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