American Creek Resources Ltd. v. Teuton Resources Corp., 2013 BCSC 1042
This mid-trial ruling in the context of a breach of contract case serves as a reminder that, at least in British Columbia, mining companies may not be able to rely on their own employees to provide opinions about specialized mining processes. Barring exceptional circumstances, independent experts should be obtained.
In 2007, American Creek Resources Ltd. (American Creek) and Teuton Resources Corp. (Teuton) entered into an option agreement related to Treaty Creek, a property in northwestern B.C. that was owned by Teuton. Under the agreement, American Creek would earn a 51% interest in the property if it spent a specified amount on exploration expenditures. Teuton agreed that American Creek had spent more than the specified amount, but disagreed that all amounts should qualify as exploration expenditures. In support of its position, Teuton's president attempted to give evidence on a number of technical subjects, including his opinion that certain drill patterns used by American Creek did not amount to "exploration" as that term was used in the agreement, such that related expenditures could not qualify. American Creek challenged the admissibility of much of the witness's evidence on the grounds that it was inadmissible opinion.
The Court reviewed the applicable law, confirming that since the witness was an employee of a party he could not be qualified as an expert. It may still be possible to receive lay opinion evidence from the witness, but only if a four-part test was satisfied: (1) the witness had personal knowledge of the relevant facts, (2) the witness was in a better position than the judge to draw the inferences he did, (3) the witness had the "experiential capacity" to form the opinion he did, and (4) the witness could not as accurately describe the facts without stating his opinion.
In the circumstances of this case, the four-part test was not satisfied and Teuton's president was precluded from providing opinion evidence. The Court noted that the evidence sought to be adduced did not consist of "everyday inferences from observed facts," but rather, concerned matters of specialized, technical expertise. To be admissible, this type of evidence must come from a qualified expert who certifies that he is not an advocate for either party.
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