Re-Opening the Economy – Has the Standard of Care for Business Changed?

COVID-19 Liability Series: The Effect of COVID-19 on Businesses’ Obligations to Prevent Harm

As provincial governments begin to ease lockdown measures and slowly reopen their economies, business operations will not be returning to normal anytime soon.

The high risk of a resurgence of COVID-19 cases means that businesses are expected to take significant precautions to minimize the risk of transmission through implementing physical distancing and sanitizing requirements and ensure that their place of business is reasonably safe from a public health standpoint.

Prior to COVID-19, apart from food or health-related services, many businesses did not have to be concerned about the prospect of exposing others to the harm of an infectious disease. However, since the pandemic outbreak , the question will not be whether a business owes a duty of care to prevent the spread of this particular illness, but what standard of care they must adhere to in their particular circumstances. Failure of a business or service provider to meet the applicable standard of care could expose that business to liability for negligence.

This article will discuss how the standard of care expected of businesses has changed and what considerations every business should be mindful of in order to ensure they are taking sufficient precautions under the law to meet the new standard.

What is the Standard of Care?

Generally, the law requires a person to conduct him or herself in a way that avoids creating a reasonably foreseeable risk of harm towards others who are in a sufficiently close and direct relationship with that person.

What this duty specifically entails largely depends upon the level of skill expected of a reasonably prudent person acting in similar circumstances. For example, it is well-established that a physician could be found negligent for leaving a sponge in a patient during an operation since doing so was below the standard of care expected of a reasonably competent physician: Anderson v Chasney, [1949] 4 DLR 71 (Man CA), aff’d [1950] SCR viii. Similarly, an electrical contractor may be liable where it did not take steps to prevent a building fire while carrying out its contract: Magna Electric Corporation v Tesco Electric Ltd., 2015 SKQB 35, 469 Sask R 15.

To establish that a business breached its standard of care in a manner that was negligent, one  must show: (a) what a reasonable person in the circumstances of that business would do; and (b) that the business did not do what the so-called reasonable person would have. This raises the question of: what factors inform this standard and what sources can businesses consult to help ensure they are acting reasonably?

What Informs the Standard of Care?

The standard of care expected of a business is not perfection, nor is it set in stone. It is contextual, and is related to the time and level of knowledge and understanding of the industry. Businesses are not judged by hindsight, but are instead judged by what they reasonably ought to have known at the time. What was considered to be the applicable standard of care in 1995 may not be the same standard in 2020. In addition, due to the rate of changes to government regulation and the quickly evolving nature of the public health threat posed by COVID-19, what may have been sufficiently prudent for businesses to do (or not do) just months ago could very well constitute negligence today.

The standard of care required of an individual or business is informed by several sources. First, it is helpful to consider applicable legislation governing a particular business or industry. It should be noted, however, that while legislation plays an important role in informing the standard, a statutory duty is only one component in the general law of negligence. Mere compliance with an applicable statute may not mean that a business has done all that it was required to do in the circumstances to avoid causing harm to others. By the same token, the fact that a business has breached a statute does not automatically result in a finding of negligence. This principle often surfaces in the context of civil lawsuits involving  motor vehicle accidents, such as in Greenwood v Dietz, 2005 SKQB 15, 261 Sask R 25. In that case, the mere fact that the defendant driver was transporting farming equipment before sunrise, in breach of the Regulations under the Highways and Transportation Act, was irrelevant to whether the defendant was negligent because his statutory breach was not the cause of the accident.

Another important source that informs the standard of care are the customs and practices of other businesses in the industry. Courts often consider whether all businesses are taking similar precautions to prevent a specific harm or if there are a variety of practices or standards across the industry. Therefore, it is critical to identify whether your business is taking steps that are in line with your industry’s practices.

A third and similar source to consult are industry-specific protocols and guidelines, such as those recently put forward by the College of Dental Surgeons of Saskatchewan. Practices set out in these documents may indicate what is reasonable in a given industry and will often be given significant weight by courts. Again, while these policies and guidelines often play significant roles, they are not determinative of the standard of care but only inform what is “reasonable.”

A recent illustration of the point can be found in University of Regina v Biletski, 2019 SKCA 44, where a jury held the University liable either for permitting diving blocks to be used in its pool’s shallow end and/or for its maintenance of its diving blocks. With respect to the placement of the diving blocks, the University argued that it had been complying with industry practices when it placed them in the shallow end. However, since industry practices are not determinative, it was open to the jury to find that simply complying with industry practices was not sufficient to protect the University from liability. Similarly, referring back to the sponge case, the defendant physician was found negligent for leaving a sponge in his patient even though it was not standard practice at the time to count sponges after surgery. In the final analysis, compliance with industry-specific guidelines is important and often sufficient, but the ultimate question will always remain whether the business acted reasonably.

The Effects of COVID-19 on the Standard of Care

So – how has COVID-19 changed the standard of care that businesses must meet? What businesses are required to do by law continues to change, with additional cleaning and disinfecting procedures imposed, as well as restrictions placed on how they are able to do their business. Even more, how businesses respond may differ across industries as associations, organizations and regulatory bodies continue to update the guidance provided to their membership. All of these changes mean that what is reasonable for a business is itself evolving and changing, and businesses must be diligent in staying up-to-date.

In light of this evolving standard of care, some steps that businesses should consider taking include:

  • remaining up-to-date on and complying with the government’s orders and recommendations, whether public health orders, re-opening plans, operational restrictions, or otherwise;
  • complying with recommendations made by industry organizations and with advice or directives made by regulatory bodies;
  • staying apprised of adaptations and safeguards implemented by competitors both locally and nationally and implementing the same adaptations and safeguards; and
  • taking steps, including introduction of new policies and procedures, to ensure employee and staff compliance with all adaptations and safeguards implemented.

In saying this, we recognize the challenges that businesses face in staying up to date on what is required of them. MLT Aikins encourages any business to contact us for industry-specific advice regarding meeting the standard of care and for assistance with related matters.

Note: This article is of a general nature only and is not exhaustive of all possible legal rights or remedies. In addition, laws may change over time and should be interpreted only in the context of particular circumstances such that these materials are not intended to be relied upon or taken as legal advice of opinion. Readers should consult a legal professional for specific advice in any particular situation.

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