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5.7.12 Brown & Huston Ltd. v. The Corporation of the City ofYork et. al.

Location: Ontario

Court:

Year: 1983

Importance: engineers may be liable for negligence in report preparation

Details:

•Consulting engineers had been hired to prepared a soils and ground-water-level report, but had neglected to include some important information.

•A contractor was then hired to construct an underground pumping station. The contractor was required by the contract to personally examine the site for conditions to be encountered during construction.

•Based on the incomplete report, the contractor did not expect a water problem, and underbid on the job.

•The court determined that the contractor was 25% negligent in not requesting the missing information.

•The engineers were found 75% liable for their negligence.

5.7.13 Calax Construction Inc. v. Lepofsky

Location: Ontario Court:

Year: 1974

Importance: an example of the legal capacity to contract based on licenses Details:

• An unlicensed building contractor was unable to enforce a contract because without the license they did not have the legal capacity to enter into the contract.

5.7.14 Calgary v. Northern Construction Company Division of MorrisonKnudsen Company Inc. et. al.

Location: Alberta Court:

Year: 1982

Importance: a case that was not allowed a dismissal for unilateral mistake Details:

•A clerical error on a bid of $9,342,000 left out $181,000

•The next highest bid was $9,737,000

•When the bid was accepted, the contractor refused to carry out the work.

•The next highest bid was accepted and the first contractor sued.

•The court chose not to apply the unilateral mistake principle because the contract had been accepted and there was no deposit forfeit escape clause.

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5.7.15 City of Kamloops v. Nielsen et. al.

Location: Canada Court:

Year: 1984

Importance: the supreme court upheld [Sparham Souter] and rejected [Pirelli] Details:

•Houses were being built with improper foundations

•The building inspector noticed the deficient foundations and issued a stop work order. This order was ignored and the building inspector did not enforce it.

•A plumbing permit was issued 8 months later.

•2 years after the stop work order had been issued the house was finished and sold (an occupancy permit was never issued).

•The new owner discovered that the foundation had subsided, and sued.

•It was found that the city was 25% liable and the builder 75% liable for damages (costs involved with repair of the house, etc.).

•Part of this case involved the limitation date. The court upheld the [Sparham Souter] case and rejected Pirelli.

5.7.16 Conwest Exploration Co. Ltd. et. al. v. Letain

Location: Canada Court:

Year: 1963

Importance: the application of equitable estoppel to allow a gratuitous promise. Details:

•A time limited option contract was used to allow exploration before mining claims were Pursued.

•The contract stated that certain actions were required by a certain date to acquire mining claims.

•It became obvious that the tests would not be complete by the expiry date, and the owner implied that an extension would be allowed. (In effect this was a gratuitous promise).

•Later the owner held to the strict wording of the contract and enforced the expiry date as written.

•The supreme court agreed that enforcing the original contract strictly would be inequitable, therefore the contract was “estopped”, effectively allowing the extension, even though there was no consideration.

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5.7.17 Corporation of District of Surrey v. Carrol-Hatch et. al.

Location: British Columbia

Court:

Year: 1979

Importance: an example of concurrent tort-feasor

Details:

•An architect had been hired to design a new police station.

•The architect hired an engineering firm to do the structural design.

•The engineers dug two shallow test pits and recommended deep soils tests to the architects. The architect rejected the recommendation and the engineers submitted a soils report to the owner based on the shallow test pits.

•The building was built, and eventually it settled causing damage.

•The architect was found 60% liable, and the engineer 40% because they had failed to inform the owner that more soils tests were required.

5.7.18 Croft Construction Co. v. Terminal Construction Company

Location: Ontario Court:

Year: 1959

Importance: an engineers power to certify binding amounts, even with mistakes Details:

•A construction contract stated that an engineer would calculate the values of payments to the contractor.

•The court ruled that the engineers figures would stand (even with mistakes) as long as there was no fraud or bad faith on the engineers part.

5.7.19 Dabous v. Zuliani et. al.

Location: Ontario

Court:

Year: 1976

Importance: negligence in inspection can lead to liability

Details:

•An architect contracted to design then supervise the construction of a house.

•During the construction a metal chimney was placed too close to wooden joints.

•The architect noticed the metal chimney problem, and ordered the problem corrected.

•A second similar chimney was installed and covered over before inspection. The architect did not ask to have the chimney exposed for inspection.

•After occupation the metal chimney caused the wood to catch fire, and caused damage.

•In court the architect was held liable because of a duty of care to inspect.

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5.7.20 Davis Contractors Ltd. v. Fareham Urban District Council

Location: England

Court:

Year: 1956

Importance: a failed bid for discharge by frustration

Details:

•A construction contract was made to build 78 houses over 8 months.

•After 56 houses were built the contractor determined that the labor shortage was great enough to prevent completion.

•In the resulting suit against the contractor the court ruled that although the contractor overlooked the labor shortage and as a result is in an unfortunate situation, but of his own making. Therefore it refused to discharge the contract on the grounds of frustration.

5.7.21 Demers et. al. v. Dufresne Engineering et. al.

Location: Canada Court:

Year: 1977

Importance: an engineer has a duty to direct contractors when obvious problems exist Details:

•A contractor built a caisson (?) for a bridge pier, but did not use enough reinforcing steel.

•An engineer was able to see the construction method, but did not comment. His representative did add a small amount of vertical reinforcement.

•After completion the caisson failed and had to be replaced at a cost of $1.4 million.

•In the resulting court case the engineer was assumed to have approved the method by remaining silent. There was also implied consent because of the reinforcement added.

•The engineer was found 50% liable because of the implied approval.

5.7.22 Derry & Peek

Location: England Court:

Year: ?

Importance: contract was rescinded because of fraudulent misrepresentation Details:

• Fraudulent misrepresentation is defined as, made “(1) knowingly, or (2) without belief in its truth, or (3) recklessly, careless whether it be true or false.”