Supreme Court Judgments

SUPREME COURT OF CANADA

Grandview v. Doering, [1976] 2 S.C.R. 621

Date: 1975-10-27

Town of Grandview (Defendant) Appellant; and

Arthur Herbert Doering (Plaintiff) Respondent.

1975: May 21; 1975: October 27.

Present: Laskin C.J. and Martland, Judson, Ritchie, Spence, Pigeon, Dickson, Beetz and de Grandpré JJ.

ON APPEAL FROM THE COURT OF APPEAL FOR MANITOBA

Actions—Waters of river impounded by dam—Action for damages from flooding of lands dismissed—Second action for damages occurring in subsequent years from water saturation due to effect of dam on aquifer—Action barred—Res judicata.

The respondent sued the appellant municipality in 1969 for damages to his land and crops resulting from flooding in the years 1967 and 1968 and alleged to be due to a dam earlier built by the municipality but altered by it in 1967. The action was dismissed on May 24, 1973.

Some nine months later, the respondent commenced a new action, claiming damage to his crops from water in 1969, 1970, 1971 and 1972 as a result of the municipali­ty having maintained the river waters at an artificially high level behind the same dam, causing the water of the river to enter an aquifer consisting of sandy soil about four feet below the surface of the respondent's lands and thus to saturate the soil with water.

A motion was brought by the municipality seeking to have the second action stayed or set aside. The trial judge granted the motion and stayed the action. On appeal, the judgment of the trial judge was reversed by a majority of the Court of Appeal and from that decision the municipality appealed to this Court.

Held (Laskin C.J. and Spence, Pigeon and Beetz JJ. dissenting): The appeal should be allowed and the order staying the action restored.

Per Martland, Judson, Ritchie, Dickson and de Grandpré JJ. The principle of res judicata applied in this case. The issue of whether the river was caused to

[Page 622]

overflow its banks and damage the respondent's lands because the town had wrongfully impounded the waters behind the dam was thoroughly explored in the first action. The same question was raised in the present action. Although the years when the damage was alleged to have occurred in the second action were different from the first, all other conditions were exactly the same except that since judgment was rendered in the earlier action, the respondent had taken advice leading him to the conclusion that the water which damaged his crops, although coming from the same source, reached his land by saturation through an aquifer rather than by "flooding".

It was not alleged by the respondent that he could not by reasonable diligence have put himself in a position to advance the theory of soil saturation through the aquifer at the time of the first action, nor could it be said that his failure to raise that particular point did not arise "through negligence, inadvertence or even accident". A burden lay upon the respondent to at least allege that the new fact could not have been ascertained by reasonable diligence at the time when the first action was commenced before he could invoke it so as to expose the appellant a second time to litigation arising out of the same conduct.

Per Laskin C.J. and Spence, Pigeon and Beetz JJ., dissenting: The same question was not raised in the present action as was raised in the earlier one. The question in the first action was whether the dam caused damage in high water, i.e., by causing the river to overflow its banks; in the second action, the question was whether the dam caused damage in low water, i.e., whether, due to the presence of an aquifer four feet under the surface, it caused water saturation by keeping the water level higher than it would be under natural conditions.

There was no valid reason preventing the respondent from claiming damage in later years because, by artifi­cially keeping the water level higher than it would be under natural conditions after the flood has subsided, the town's dam causes damages to crops on account of the presence of an aquifer under the surface soil. To so hold is to deny justice by a technical application of rules of court. When dealing with statutes, it is the Court's duty to apply the law as Parliament has written it. However, when, as here, the Court is dealing with judge-made law, there is no reason for denying justice on account of technicalities.

[Page 623]

[Henderson v. Henderson (1843), 3 Hare 100; Ord v. Ord, [1923] 2 K.B. 432; Hall v. Hall and Hall's Feed & Grain Ltd. (1958), 15 D.L.R. (2d) 638; Phosphate Sewage Co. v. Molleson (1879), 4 App. Cas. 801; Fenerty v. City of Halifax (1920), 50 D.L.R. 435; Fidelitas Shipping Co., Ltd. v. V/O Exportchleb, [1965] 2 All E.R. 4; Angle v. Minister of National Revenue, [1975] 2 S.C.R. 248; New Brunswick Ry. Co. v. British and French Trust Corp., Ltd., [1939] A.C. 1, referred to.]

APPEAL from a judgment of the Court of Appeal for Manitoba[1], setting aside an order made by Dewar C.J.Q.B. staying an action brought by the respondent against the appellant. Appeal allowed and order staying the action restored.

Knox B. Foster and Rodney Stevenson, for the defendant, appellant.

Walter C. Newman, Q.C., and L. J. Lucas, for the plaintiff, respondent.

The judgment of Laskin C.J. and Spence, Pigeon and Beetz JJ. was delivered by

PIGEON J. (dissenting)—This appeal is from a judgment of the Court of Appeal for Manitoba setting aside, Guy J.A. dissenting, an order made by Dewar C.J.Q.B. staying an action brought on January 21, 1974, by the respondent Doering against the present appellant, the Town of Grandview.

Doering had sued the town in 1969 for damages to his land and crops resulting from flooding in the years 1967 and 1968 and alleged to be due to a dam earlier built by the town but altered by it in 1967. The action also claimed an order for the removal of the dam. That action was dismissed by Tritschler C.J.Q.B. on May 24, 1973. His oral judgment disposed of the claims in the following words:

This case has been before the Court for many years, and this is our second hearing. I have had an opportu­nity of studying carefully the report prepared by the Water Resources Branch under the direction of Mr.

[Page 624]

Bodnaruk, a professional engineer. His evidence today strengthens the conclusions which were reached in that report, and I see no reason for delaying this matter further.

The very simple issue here is whether the frequent flooding of Mr. Doering's land, which no one disputes, is attributable to the maintenance by the town of Grand-view of its dam.

Unfortunately, Mr. Doering has convinced himself that the dam has been the cause of his flooding troubles. That is not so. Not only has he failed to satisfy the onus of proving that the flooding of his land was caused by the defendant's darn, but his own evidence establishes the very contrary of that; namely that the flooding would have taken place if the dam had not been in existence.

At the north boundary of plaintiff's quarter section, that is at "Cross Section L" shown in Exhibit 8, the backwater effect of the dam was less than one-tenth of a foot for the 1967 flood, and at "Cross Section Q" and "U" there was no noticeable backwater effect from the dam.

Mr. Bodnaruk's report and the evidence establishes that, regardless of the dam, plaintiff's land will experi­ence flooding when the river discharge exceeds 750 cubic feet per second.

In the spring of 1967 it was 1,330 cubic feet per second and there had to be flooding.

It is clear from the evidence that plaintiff's land is going to be flooded to some extent nearly every year because it will flood whenever the flow exceeds 750 cubic feet per second, and the mean flood is 879 cubic feet per second. You are going to have flooding there every year except in a dry year like the present.

The evidence fully satisfies the Court that the flood­ing, which is the subject matter of this action, was not caused and was not contributed to by the defendant's dam. The action fails and will be dismissed.

The essential allegations of the statement of claim in the present case as amended, are the following:

4. Prior to the 1st day of January, 1967, the defendant operated a dam in the said River at a point in the said River within the corporate limits of the defendant corpo­ration. The said dam was operated in such a manner as to during the fall and winter seasons impound water and cause to be built up the water up stream from the dam

[Page 625]

to an artificially high level but after spring break up the defendant would cause the dam to be adjusted so as to return the water level to its natural height during the crop growing season. In 1966 the said dam was damaged, and was replaced by a mound of earth, stones and large pieces of waste concrete constructed by or on behalf of the defendant as a makeshift dam and no attempt was made except as hereinafter stated to reduce the level of the water impounded up stream by the said mound during the growing season in each year.

5. The said farm land of the plaintiff has a layer of natural aquifer consisting of sandy soil about four feet below the surface of its top soil and in consequence of the defendant maintaining the water up stream at an artificially high level since 1967 during the growing season including where the said river runs through the plaintiff's land causes the water to enter the aquifer and to saturate the soil to such an extent that either crops cannot be sown or if they are sown then crops fail to grow on some 40 acres more or less thus causing the plaintiff damage.

6. The plaintiff has repeatedly demanded that the defendant reduce the height of water to its natural level during the growing season and has advised the defendant repeatedly of the damage caused but the defendant has refused or failed to do anything to eliminate the said cause except once just prior to the 1973 growing season when the said mound that serves as a make-shift dam was opened up in time to enable the plaintiff to sow his 1973 crop and for it to grow unaffected by the satura­tion aforesaid.

7. The acreage affected by the said saturation has never been less than 34 or more than 46 acres and the plaintiff has had to work the land whether or not he harvests the crop.

8. In consequence of the said wrongful actions of the defendant the plaintiff has suffered the following crop losses during the undermentioned years including interest, namely:

1969      46 acres         $1,350.00

1970      34 acres         $ 986.00

1971      40 acres         $1,118.00

1972      40 acres         $1,036.00

Total                $4,490.00

The defendant has refused to give assurances for the 1974 growing season, and for every year thereafter that the said river will be permitted to fall to its natural level during the crop growing season.

[Page 626]

Allowing the town's motion to stay the action, Dewar C.J.Q.B. said in particular:

None of the facts alleged re the conduct of the defendant in the pending action are new, in the sense that they did not exist when the prior action went to trial in September 1972. There is no suggestion the aquifer, now alleged to serve as a conductor of water from the forebay to plaintiff's lands, did not exist in the years 1967 through 1972. All of the facts now alleged as to tortious conduct (which is the essence of this type of actionable nuisance) were available and could have been brought forward in the prior action. If they were not, whether by inadvertence, failure to exercise reasonable diligence, or accident, the plaintiff is not now entitled to pursue what is substantially the same claim, but for damage alleged to have been sustained in subsequent years.

The alleged tortious conduct of defendant is not the only issue that has already been the subject of litigation. The damages now claimed (i.e. for the years 1969 through 1972) were also at issue in the 1969 action, whether or not they were pleaded.

Rule 222 provides:

Damages in respect of any continuing cause of action shall be assessed to the time of assessment.

The 1969 action was tried in September 1972 and May 1973.

The effect of Rule 222 is indicated in the reasons of Schroeder, J.A. in Toronto General Trusts Corporation v. Roman (1962), 37 D.L.R. (2d) 16, affirmed by the Supreme Court of Canada, (1964), 41 D.L.R. (2d) 290.

Plaintiff is not entitled to what would be a retrial of the same issues determined in the earlier action. "The plea of res judicata is not a technical doctrine, but a fundamental doctrine based on the view that there must be an end to litigation": per Maugham, J. in Green v. Weatherill [1929] 2 Ch. 213, at p. 221.

On the other hand, Matas J.A. with whom Freedman C.J.M. agreed, said:

[Page 627]

In my view, with respect, it is open to plaintiff in the case at bar to raise the question of the aquifer in a second action. That question was not raised and was not considered in the 1969 action nor was it fundamental to the decision in the first action. (Hill v. Hill (1966) 56 W.W.R. 260). It is clear from a reading of the judgment in the 1969 action, that Tritschler, C.J.Q.B., considered the liability of Grandview only in the context of a claim as to surface flooding. If plaintiff had sought to reliti­gate that issue he would be precluded from doing so by the plea of res judicata. But if plaintiff were to be successful in these proceedings, the judgment would not be inconsistent with that of Tritschler, C.J.Q.B., where the only question considered by the court was the effect of the impounding of water on surface flooding. The finding of the court in that action is not challenged by plaintiff in any way. The present action is concerned, not with surface flooding, but with sub-surface satura­tion of the soil due to the alleged effect of the darn on the aquifer.

In my view, the majority opinion in the Court of Appeal reflects a sound approach to the doctrine of res judicata. It is in accordance with the guid­ing principle stated by Lord Maugham L.C. in New Brunswick Ry. Co. v. British and French Trust Corporation[2], at pp. 20-21:

... I desire to make it plain that I am not desirous of questioning the general rule on the subject of res judica­ta laid down by Wigram V.-C. in Henderson v. Hender­son (1843) 3 Hare 100, 114. His statement of the rule was cited and approved by the Judicial Committee in Hoystead v. Commissioners of Taxation, [1926] A.C. 155, 170. It is however, to be noted that the learned Vice-Chancellor was stating the rule in general terms, and he qualified the rule by the exception of special circumstances or special cases. I do not think it neces­sary to express an opinion as to whether the alleged estoppel would have succeeded if the appellants had appeared in and contested the first action. But the judgment in that action limited in form to a single bond was pronounced in default of appearance by the defendants. In my view not all estoppels are "odious"; but the adjective might well be applicable if a defendant, par­ticularly if he is sued for a small sum in a country distant from his own, is held to be estopped not merely in respect of the actual judgment obtained against him,

[Page 628]

but from defending himself against a claim for a much larger sum on the ground that one of the issues in the first action (issues which he never saw, though they were doubtless filed) had decided as a matter of inference his only defence in the second action.

In the present case, the central fact is that Doering's claim for damages to his crops in 1969, 1970, 1971 and 1972 by water saturation due to the effect of the dam on the aquifer was never litigated. All that was litigated was a claim for damages due to flooding in 1967 and 1968. It was found that flood conditions were not appreciably aggravated by the dam and Doering should cer­tainly not be allowed to raise that contention again, even in respect of later years.

It is true that the issue of whether the river was caused to overflow its banks and damage the respondent's lands because the town had impounded water behind the dam, was thoroughly explored in the first action. It was then determined that the impoundment had a negligible effect on the overflow and it is the only basis on which the action was dismissed.

That same question is not raised in the present action. What is urged is a completely different cause of action said to have occurred at a different time of the year, not at flood time, but during the growing season after any flood has subsided. It is not claimed that the dam has caused the river to overflow its banks, but that, due to the presence of an aquifer four feet under the surface, it has caused water saturation by keeping the water level higher than it would be under natural conditions. In other words what has been determined in the first action is that the dam did not cause the overflow that occurred in flood time, it has never been determined that it did not cause the water saturation that is alleged to have occurred after flood time. More simply, the question in the first action was whether the dam caused damage in high water, in the second, it is whether it caused

[Page 629]

damage in low water.

It is said that the aquifer always was there, this is true, but it is not by its mere presence that the crops are alleged to have been damaged, but by the raising of the water level, not to overflow level, but to aquifer level. Nothing shows that the damage suffered by the respondent in the two years covered by the first action was not, in fact, caused by the flooding for which the town was held not responsible. To say that it was in fact caused by water saturation as in the subsequent years covered by the second action, is to make an assumption for which there is no basis in the record. The respondent is precluded by res judica­ta from so contending in respect of the damage claimed by the first action. Then on what basis may the town so contend in order to defeat the claim in respect of subsequent years? I cannot see any.

I fail to see any valid reason preventing the respondent from claiming damages in later years because, by artificially keeping the water level higher than it would be under natural conditions after the flood has subsided, the town's dam causes damages to the crops on account of the presence of an aquifer under the surface soil. To so hold is to deny justice by a technical application of rules of court. When dealing with statutes, it is our duty as I see it, to apply the law as Parliament has written it. However, when, as here, we are dealing with judge-made law, I can see no reason for denying justice on account of technicalities, (cf. Ares v. Venner[3]; Frank v. Alpert[4].

In my view, the rule concerning the assessment of damages up to the date of the trial for a continuing cause of action was meant to facilitate recovery of what is due in fairness, not to deprive

[Page 630]

litigants of claims they have not urged. Reference was made by Dewar C.J.Q.B. to Schroeder J.A.'s reasons in Toronto General Trusts Corp. v. Roman[5]. In my view, what was there decided is fully in accordance with the principle I am contending for as to the effect of the rule: it was not permitted to defeat the claim for damages subse­quent to the trial.

In the present case, it is not a matter of assessment of damages that is in issue, it is the entitlement to damages that comes up for decision and in my view, the rule as to a continuing cause of action is not properly applicable. What happens each year is due to what occurs that year. There may be damage one year, not in another.

Concerning the contention that the staying order was made in the exercise of judicial discre­tion, I would merely refer to such cases as Ladou­ceur v. Howarth[6] and Witco Chemical Co., Canada, Ltd. v. Town of Oakville[7]. The Court of Appeal has made it a condition of its order that Doering pay the costs taxed against him in the 1969 action. In so doing it has, in my view, given the town all the protection against abuse of process that can properly be claimed.

I would dismiss the appeal with costs and would not accede to appellant's request for costs on respondent's motion at the hearing concerning the Bodnaruk report which was withdrawn. There was no real necessity for a memorandum on that motion, nor for copies of the evidence at the trial of the 1969 action.

The judgment of Martland, Judson, Ritchie, Dickson and de Grandpré JJ. was delivered by

RITCHIE J.—I have had the advantage of read­ing the reasons for judgment of my brother Pigeon in which he has recited many of the facts giving

[Page 631]

rise to this appeal as well as relevant portions of the pleadings and of the judgments in the Manito­ba Courts.

This is the second of two actions brought by the respondent against the Town of Grandview; both actions are founded in nuisance and both assert claims for damage by water to the respondent's land and the crops thereon, allegedly caused by the conduct of the Town of Grandview in the construc­tion and operation of a "make-shift" dam whereby the waters of the Valley River where it runs through the respondent's land, were so "impounded" as to have adversely affected his soil and crops.

The first action was brought in April 1969, claiming that by repairing and replacing a dam previously existing, the town had "impounded a large volume of water and caused to be built up a large unnatural and above normal head of water ... and raised the water levels in the said River .." and it is further alleged that "the said dam obstructed the natural flow of water and caused the waters therein to overflow the banks ... flooded, inundated, cut away and eroded the plaintiff's said land."

The first case which related to damage to the plaintiff's lands and crops in the years 1967 and 1968, and is herein referred to as the 1969 action, was apparently not called for trial until September 1972, at which time the hearing was adjourned until May 1973, when Chief Justice Tritschler rendered his decision, the opening words of which indicate that both parties had ample time to con­sider all phases of the matter before and during the trial; in this regard, the Chief Justice observed:

This case has been before the courts for many years, and this is our second hearing.

Chief Justice Tritschler's reasons for judgment are conveniently recited in the reasons of my brother Pigeon and I only find it necessary for the purpose of these reasons to abstract the following two quotations:

[Page 632]

(i) The very simple issue here is whether the frequent flooding of Mr. Doering's land, which no one disputes, is attributable to the maintenance by the town of Grand-view of its dam.

Unfortunately, Mr. Doering has convinced himself that the dam has been the cause of his flooding troubles. That is not so. Not only has he failed to satisfy the onus of proving that the flooding of his land was caused by the defendant's dam, but his own evidence establishes the very contrary of that; namely that the flooding would have taken place if the dam had not been in existence.

(ii) It is clear from the evidence that plaintiff's land is going to be flooded to some extent nearly every year because it will flood whenever the flow exceeds 750 cubic feet per second, and the mean flood is 879 cubic feet per second. You are going to have flooding there every year except in a dry year like the present.

The evidence fully satisfies the Court that the flood­ing, which is the subject matter of this action, was not caused and was not contributed to by the defendant's dam.

Within nine months of this judgment being ren­dered, a new action was commenced by the same Mr. Doering claiming damage to his crops from water in 1969, 1970, 1971 and 1972 as a result of the Town of Grandview having maintained the waters of the Valley River at an artificially high level behind the same dam. The conduct alleged against the town as the foundation for both actions was the same, namely, the impounding of the waters of the river at an artificial height due to the darn, but in the second action it was alleged that the damage was occasioned by the "impounding" causing the water of the river to overflow and enter an "aquifer" consisting of sandy soil about four feet below the surface of Doering's lands and thus to saturate the soil with water.

The reason for bringing the second action is frankly explained in the affidavit filed herein by Mr. Doering where he says:

I consulted Walter Carman Newman about taking an appeal from that judgment which held that the damage to my land and crops that I suffered in 1967 and 1968 was not caused by surface flooding by waters impounded by the dam in question.

[Page 633]

4. I was advised by Walter C. Newman that the damage to my land and crops which continued in 1968, 1969, 1970, 1971 and 1972, was probably not due to surface flooding at all but caused by the impounded water flowing through an aquifer layer underneath the topsoil of the plaintiff's land and saturating the ground above during the relevant periods. He further advised me that since these issues were not dealt with in the 1969 action, an appeal would be ineffectual in such a case and that I had to start another action.

5. Acting upon the suggestion of Walter C. Newman I consulted Professor Andrew Baracos, a recognized soils expert, who conducted tests on the said land and confirmed the suggestion of Walter C. Newman.

6. Prior to 1973 I had no knowledge of an aquifer lying close beneath the topsoil of my land or the effect that such an aquifer would have when waters are impounded at an artifical [sic] height in a river to which the aquifer extends, I believing only that the saturation of my soil could only be due to surface flooding. The question of the aquifer was therefore not raised in the 1969 action and the action in any event could not deal with the damage caused to my land and crops in the years 1969 to 1972 both inclusive.

This affidavit was filed on a motion brought by the defendant before Chief Justice Dewar seeking to have the action stayed or set aside. Excerpts from the decision on that motion are once again conven­iently recited in the reasons for judgment of my brother Pigeon. I only find it necessary to advert to the following paragraph which he quoted.

None of the facts alleged re the conduct of the defendant in the pending action are new, in the sense that they did not exist when the prior action went to trial in September 1972. There is no suggestion the aquifer, now alleged to serve as a conductor of water from the forebay to plaintiff's lands, did not exist in the years 1967 through 1972. All of the facts now alleged as to tortious conduct (which is the essence of this type of actionable nuisance) were available and could have been brought forward in the prior action. If they were not, whether by inadvertence, failure to exercise reasonable diligence, or accident, the plaintiff is not now entitled to pursue what is substantially the same claim, but for

[Page 634]

damage alleged to have been sustained in subsequent years.

Later in his judgment, Chief Justice Dewar cited the cases of Henderson v. Henderson[8] and Ord v. Ord[9] and quoted the following passage from Vice-Chancellor Wigram's reasons for judgment in the former case at p. 115:

... I believe I state the rule of the Court correctly when I say that, where a given matter becomes the subject of litigation in, and of adjudication by, a Court of com­petent jurisdiction the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inad­vertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the Court was actually required by the parties to form an opinion and pro­nounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time.

In reversing the judgment of Chief Justice Dewar, Matas J.A., speaking for himself and Freedman C.J.M., (Guy J.A. dissenting) in the Court of Appeal of Manitoba, referred to the last-quoted excerpt from the case of Henderson v. Henderson, but adopted the interpretation placed upon that case by Johnson J.A., with whom Ford C.J.A. agreed in the Court of Appeal of Alberta in Hall v. Hall and Hall's Feed & Grain Ltd.[10], where he characterizes the proposition stated by Vice-Chancellor Wigram as "the wider principle res judicata" and goes on the say:

It was apparently the wider principle of res judicata that was applied in the present case. This doctrine has

[Page 635]

not so wide an application as the broadness of the language might lead one to infer. It is limited to such matters as arise within one cause of action. It is, I think, clear that if there are facts which are common to several causes of action, an inquiry into these facts in one cause of action does not prevent an examination of the same facts where another cause of action is set up, provided that this cause of action is separate and distinct.

In that case the first action had been brought for an accounting between husband and wife, where the second action involved the allegation that a business partnership had existed between them which had been converted into a limited company and the wife sought compensation for her interest in the partnership. There were thus clearly two separate causes of action, but with the greatest respect, I cannot agree that the causes of action in the two cases here under consideration are sepa­rate and distinct. As Chief Justice Dewar points out, all the facts which are alleged to constitute tortious conduct by the town in the present case existed when the prior action went to trial and it was there found that these facts did not support the present respondent's action for damage to his crops by water. The only new issue raised in the present case is the contention that the same conduct for which the town was exonerated from blame in respect of damage to crops in 1967 and 1968 is blameworthy in respect of the damage done in 1969, 1970, 1971 and 1972 because, although the water came from the same source, it reached the respondent's land by a different route. The aquifer was on the respondent's land before 1967 and he states in his affidavit that damage to his land and crops complained of in the first action was probably caused by it according to the infor­mation which he received from the expert whom he consulted after the trial. Nothing had changed between the bringing of the first action and the second one except that the respondent had received advice from a soil expert who expounded the aquif­er theory. Such an expert could probably have been consulted before the first action, and if he had been then the matter would no doubt have been put in issue at that time, but in my view the circumstances here are to be considered in the light of the principles established in Phosphate

[Page 636]

Sewage Co. v. Molleson[11], where Lord Cairns said, at pp. 814-5:

As I understand the law with regard to res judicata, it is not the case, and it would be intolerable if it were the case, that a party who has been unsuccessful in a litigation can be allowed to re-open that litigation merely by saying, that since the former litigation there is another fact going exactly in the same direction with the facts stated before, leading up to the same relief which I asked for before, but it being in addition to the facts which I have mentioned, it ought now to be allowed to be the foundation of a new litigation, and I should be allowed to commence a new litigation merely upon the allegation of this additional fact. My Lords, the only way in which that could possibly be admitted would be if the litigant were prepared to say, I will shew you that this is a fact which entirely changes the aspect of the case, and I will shew you further that it was not, and could not by reasonable diligence have been, ascertained by me before. Now I do not stop to consider whether the fact here, if it had come under the description which is represented by the words res noviter veniens in notitiam, would have been sufficient to have changed the whole aspect of the case. I very much doubt it. It appears to me to be nothing more than an additional ingredient which alone would not have been sufficient to give a right to relief which otherwise the parties were not entitled to.

This passage was adopted by the Supreme Court of Nova Scotia in Fenerty v. The City of Halifax[12], where it was said at pp. 437-8:

The doctrine of res judicata is founded on public policy so that there may be an end of litigation, and also to prevent the hardship to the individual of being twice vexed for the same cause. The rule which I deduce from the authorities is that a judgment between the same parties is final and conclusive, not only as to the matters dealt with, but also as to questions which the parties had an opportunity of raising. It is clear that the plaintiff must go forward in the first suit with his evidence; he will not be permitted in the event of failure to proceed

[Page 637]

with a second suit on the ground that he has additonal evidence. In order to be at liberty to proceed with a second suit he must be prepared to say: "I will shew you this is a fact which entirely changes the aspect of the case, and I will shew you further that it was not, and could not by reasonable diligence have been ascertained by me before."

The same proposition was stated by Lord Den­ning in Fidelitas Shipping Co., Ltd. v. V/0 Exportchleb[13], where he said at pp. 8-9:

The law, as I understand it, is this: if one party brings an action against another for a particular cause and judg­ment is given on it, there is a strict rule of law that he cannot bring another action against the same party for the same cause. Transit in rem judicatam ... But within one cause of action, there may be several issues raised which are necessary for the determination of the whole case. The rule then is that, once an issue has been raised and distinctly determined between the parties, then, as a general rule, neither party can be allowed to fight that issue all over again. The same issue cannot be raised by either of them again in the same or subsequent proceedings except in special circumstances... And within one issue, there may be several points available which go to aid one party or the other in his efforts to secure a determination of the issue in his favour. The rule then is that each party must use reasonable diligence to bring forward every point which he thinks would help him. If he omits to raise any particular point, from negligence, inadvertence, or even accident (which would or might have decided the issue in his favour), he may find himself shut out from raising that point again, at any rate in any case where the selfsame issue arises in the same or subsequent proceedings. But this again is not an inflexible rule. It can be departed from in special circumstances.

The distinction between what has come to be referred to as "cause of action estoppel" on the one hand, which precludes a person from bringing an action again against another when the same cause of action has been determined in earlier proceedings, and "issue estoppel", is discussed and explained in the reasons for judgment of Dickson J., speaking on behalf of the majority of this Court

[Page 638]

in Angle v. Minister of National Revenue[14], at p. 254.

It is obvious here that the question of whether or not the water entered the aquifer and thus saturat­ed the respondent's soil was not determined in the 1969 action because it was not raised and it would therefore not be strictly accurate to classify the present case as one of issue estoppel, but I am of the view that it is certainly a case within the principle established in Henderson v. Henderson, supra, and the Phosphate Sewage Co. case, and it is to be noted that the respondent has not alleged either in his pleadings or his affidavit that he could not by reasonable diligence, have put himself in a position to advance the theory of soil saturation through the aquifer at the time of the first action, nor can it be said that his failure to raise that particular point did not arise "through negligence, inadvertence or even accident." In my opinion the burden lay upon the respondent to at least allege that the new fact could not have been ascertained by reasonable diligence at the time when the first action was commenced before he could invoke it so as to expose the appellant a second time to litiga­tion arising out of the same conduct. I appreciate that my brother Pigeon has adopted what he refers to as "the guiding principle" stated by Lord Maugham L.C. in New Brunswick Ry. Co. v. British and French Trust Corporation[15], at pp. 20-1. It will be noted, however, that the Lord Chancellor did not question the rule in Henderson v. Henderson; but found that in the case before him there were exceptional circumstances which he described as follows:

I do not think it necessary to express an opinion as to whether the alleged estoppel would have succeeded if the appellants had appeared in and contested the first action. But the judgment in that action limited in form to a single bond was pronounced in default of appearance

[Page 639]

by the defendants. In my view not all estoppels are "odious"; but the adjective might well be applicable if a defendant, particularly if he is sued for a small sum in a country distant from his own, is held to be estopped not merely in respect of the actual judgment obtained against him, but from defending himself against a claim for a much larger sum on the ground that one of the issues in the first action (issues which he never saw, though they were doubtless filed) had decided as a matter of inference his only defence in the second action.

I cannot find any such exceptional circum­stances in the present case. The issue of whether the river was caused to overflow its banks and damage the respondent's lands because the Town of Grandview had wrongfully impounded the waters behind the dam, was thorougly explored in the first action. The same question is raised by the present action. Although the years when the damage is alleged to have occurred in the second action are different from the first, all other condi­tions are exactly the same except that since Chief Justice Tritschler rendered his judgment in 1973, the respondent has taken advice leading him to the conclusion that the water which damaged his crops, although coming from the same source, reached his land by saturation through an aquifer rather than by "flooding".

For all these reasons, as well as for those con­tained in the reasons for judgment of Chief Justice Dewar, I would allow the appeal and restore that judgment with costs, except that I would allow no costs of the respondent's motion made at the hear­ing which was withdrawn.

Appeal allowed; order staying action restored, LASKIN C.J. and SPENCE, PIGEON and BEETZ JJ. dissenting.

Solicitors for the defendant, appellant: Aikins, MacAulay & Thorvaldson, Winnipeg.

Solicitors for the plaintiff respondent: Newman, MacLean, Winnipeg.