Case Comment - MacKay v Starbucks
At the beginning of May, the Ontario Court of Appeal released its decision in MacKay v Starbucks.1 At issue was the question of whether a private business owner could be held to be an occupier of otherwise public land outside of its establishment. Though it has always been clear that an individual or company is typically responsible for hazards present on their own property, MacKay introduces the potential for even greater liability for business owners under the Occupiers' Liability Act ("the Act").
The decision evaluated the liability of Starbucks in a situation where a customer slipped on a city sidewalk just outside of the business' premises. The incident occurred at a Starbucks location in Toronto where patrons are able to enter through one of two entrances off of intersecting city streets. At one of the entrances, customers have to walk through the outdoor Starbucks patio in order to access the side door. The patio in question was adjacent to the city sidewalk and enclosed by a fence with a three to four-foot opening. Other than the fence, there was no apparent demarcation between the city sidewalk outside the patio and Starbucks property; they were seamlessly connected.
As a result, Starbucks patrons must use this city sidewalk in order to enter and exit the store through the side entrance, essentially as a "passage or corridor" to the Starbucks side door. To ease the passage, the city sidewalk which adjoined the walkway was also shoveled and sanded by Starbucks employees during the winter since it was almost exclusively used by Starbucks customers. The complainant slipped on ice on the city portion of the sidewalk after leaving the Starbucks patio through the opening in the fence.
At trial, it was found that Starbucks was indeed an occupier and therefore liable for the injury suffered. Starbucks thereafter appealed this decision.
The issues considered in this appeal were essentially:
- Was Starbucks an occupier of the city portion of the sidewalk under s.1 of the Act?
- Even if Starbucks was not an occupier, did it still owe a duty of care to the complainant?
Was Starbucks an occupier under s.1 of the Act?
According to s.1 of the Act:
(a) a person who is in physical possession of premises, or
(b) a person who has responsibility for and control over the condition of premises or the activities there carried on, or control over persons allowed to enter the premises, despite the fact that there is more than one occupier of the same premises.
Starbucks, the appellant, submitted that the trial judge erred in defining it an occupier under the Act. Starbucks advocated that this determination was contrary to what was decided in a similar Ontario Court of Appeal case (Bongiardina v. York (Regional Municipality)) where it was held that someone who habitually cleared snow from a city sidewalk outside their home was not an occupier of that sidewalk for the purposes of the Act. However, the Court in MacKay found that the conduct of Starbucks differed from the owner of the residential property in Bongiardina. The owner in Bongiardina did not take any other steps to exercise control over the city sidewalk. In contrast, in MacKay it was found that a range of factors existed which demonstrated that Starbucks exercised a greater degree of control over the sidewalk. In particular, the sidewalk was almost exclusively used by Starbucks patrons who would not be on the sidewalk for any other purpose than entering Starbucks. The trial judge also observed that:
By its actions, Starbucks effectively directed all of its customers entering and exiting its store on the Hammersmith side to use that area of the sidewalk. It effectively controlled their access route and ensured that they would walk on the pathway it had designated, including on that portion of the sidewalk.2
The appellate judge was in consensus with the trial judge's determination. As a result, Starbucks remained defined as an occupier under the Act.
Did Starbucks owe a duty of care to the complainant, even if was not an occupier?
The Court considered three possible categories of care owed:
- A common law duty of care in negligence;
- The statutory duty of care owed under the Act; and
- A common law duty in nuisance.
Drawing from Bongiardina, the Court concluded that a neighbouring occupier did not owe a duty at common law to keep adjacent properties clear from hazards and the first category would not apply. Similarly, as the Act comprehensively and exclusively covered care owed by an occupier, it was clear that no duty could exist under the Act if Starbucks was not an occupier of the sidewalk. There did not appear to be any allegation that the loss was a result of nuisance flowing from Starbucks' property. Accordingly, none of the categories of care would apply.
While the Court did consider that there could exist other categories of care, it stated that those would have to be determined on a case-by-case basis.
The appellate judge, therefore, concluded that based on s.2 of the Act, there is no general common law duty of care, based on proximity principles, owed by a non-occupier in regards to sidewalks that are adjacent to that owner's property.
This case expands the kind of liability which could be faced by business owners. Starbucks cleared snow and ice from a specific portion of city sidewalk in order to direct customers to one of the entrances of its premises. It was the degree of control over the property and the use for which the control was exercised that appears to have led to the ultimate ruling. Taken to its core, this case suggests that where a business exercises control over city property in furtherance of its commercial purposes, it will be deemed to be an occupier of that public space.
This raises some interesting, and unanswered, questions as to what the cutoff is for commercial purposes. For example, had Starbucks taken it upon themselves to shovel the entirety of the outside sidewalk, which would have been beneficial to both its customers and the general public, would it have been deemed to be an occupier of the whole sidewalk?
However, one of the most important lessons to take out of MacKay is that business owners should exercise caution on how much control they exercise over city sidewalks located adjacent to their property and for what purpose. If an argument could be made that the control was for a commercial purpose, liability may flow from any injuries sustained upon that property.
1 MacKay v. Starbucks Corp., 2017 ONCA 350
2 Ibid at para 7.
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