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•The court said that the lack of notice about the urgency meant that the term for urgency had never been part of the “contract”, and therefore could not have been breached.

•The court also said that if there had been a breach of the contract, then the mill owner would have been due any losses that might have reasonably been expected at the start of the contract.

5.7.34 Halverson Inc. v. Robert McLellan & Co. et. al.

Location: Canada

Court:

Year: 1973

Importance: ruling that a contract overrides a tort

Details:

•An engineer was to modify a winch system.

•As a result of problems, the engineer was sued for negligence.

•The court ruled that the contract in the suit replaced the tort.

5.7.35 Harbutt’s Plasticine Ltd. v. Wayne Tank and Pump Co. Ltd.

Location: England

Court:

Year: 1970?

Importance: an example of fundamental breach

Details:

•A contract was prepared for the design and construction of storage tanks for stearine wax. Liabilities were limited to 2,300 pounds (approx $5,000).

•A plastic pipeline to carry the wax was wrapped with a heating element to allow the wax to flow in a liquid state.

•When put into use the pipe warped, cracked and ruptured.Wax spilled on the floor and ignited. The resulting fire destroyed the factory.

•The judge ruled that the design was so unsuitable that the contract was breached, and the liability limit did not apply. The damages awarded were 170,000 pounds.

5.7.36 Hedley Byrne & Co. Ltd. v. Heller & Partners Ltd.

Location: England Court:

Year: 1963

Importance: this allows professionals to be sued for negligently given advice Details:

• Byrne asked a bank to look into the credit status of another company that they were

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doing business with.

•The bank then contacted another bank (Heller) that did business with the company.

•Heller reported that their financial position was favorable, but also stated that their advice was “without responsibility”.

•Based on their advice, Byrne did business with the company and lost 17,000 pounds.

•The court rules that the bank would have been liable, if not for the disclaimer.

5.7.37 Imperial Glass Ltd. vs. Consolidated Supplies Ltd.

Location: British Columbia

Court:

Year: 1960

Importance: an unsuccessful attempt to argue for a unilateral mistake

Details:

•During bid preparation an incorrect figure had been used for certain material suppliers, entirely because of mistakes by the bidder.

•It was obvious to the offeree that the bidder had misestimated.

•The mistake was not overturned.

5.7.38 Jackson et. al. v. Drury Construction Co. Ltd.

Location: Ontario

Court:

Year: 1974

Importance: an example of a tort of nuisance

Details:

•A contractor was blasting.

•The blast opened fissures in the bedrock allowing barnyard materials to seep into a well.

•The court awarded damages to the farmer.

5.7.39 John Burrows Ltd. v. Subsurface Surveys Ltd. et. al.

Location: Canada Court:

Year: 1968

Importance: an example where equitable estoppel was disallowed Details:

• A promissory note (a contract) was,

“FOR VALUE RECEIVED Subsurface Surveys Ltd. promises to pay John Burrows Ltd. or order at the Royal Bank of Canada the sum of forty-two Thousand Dollars ($42,000.00) in nine (9) years and ten (10) months from April

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1st, 1963, payable monthly on the first day of May, 1963, and on the first day of each and every month thereafter until payment, provided that the maker may pay on account of principal from time to time the whole or any portion thereof upon giving thirty (30) days’ notice of intention prior to such payment.

In Default of payment of any interest payment or installment for a period of ten (10) days after the same became due the whole amount payable under this note is to become immediately due.

Subsurface Surveys Ltd. [signed by president]”

•Some payments were made more than 10 days late, but the contract was not strictly enforced.

•One interest payment was 36 days late (the parties had fallen out of favor with each other) and it was decided to call in the notice using the default clause, and Subsurface Surveys Ltd. was notified.

•In a resulting lawsuit it was claimed that the previous late payments were an implied modification of the contract and that an equitable estoppel was warranted.

•The court ruled that the indulgences taken by the plaintiff in making late payments were not evidence that the defendant intended to negotiate new contractual terms.

5.7.40 Junior Books Ltd. v. Veitchi Co. Ltd.

Location: England Court:

Year: 1982

Importance: claims for economic loss may be extended to those with no contracts Details:

•A floor was laid improperly, but was of no danger.

•Although the installer was a subcontractor (note no contract existed between them) the court found that he had a duty of care to provide skillful work. As a result the court found him liable for economic losses, and any repair costs.

5.7.41 Kamlee Construction Ltd. v. Town of Oakville

Location: Canada

Court:

Year: 1960

Importance: an example of an engineers power of certification

Details:

•An engineer was contracted for a construction project. The construction contract stated that the engineer had the final decision on the interpretation of the specifications and the quality of work.

•During the work the contractor disagreed with one of the engineers decisions, and the relationship between the partys was reduced to petty bickering.

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• In the resulting lawsuit the court ruled that the engineers decisions would stand, provided he acted in a judicial manner and without influence from the owner.

5.7.42 Kidd v. Mississauga Hydro-Electric Commission et. al.

Location: Ontario Court:

Year: 1979

Importance: an example of an engineers duty of care when preparing estimates Details:

•A consulting engineer estimated the cost to do a study.

•When done, the engineer realized that the $14,447 for support staff was much higher than the $5,000 allowed in the estimate.

•In a lawsuit to recover the difference the court ruled against the engineer stating that the work was entered into based on the estimate (there were also no disclaimers given). And, the result was so far out of line that it implied the engineer had not properly estimated.

5.7.43 Kocotis v. D’Angelo

Location: Ontario Court:

Year: 1958

Importance: improper licences can set aside a contract because of legality Details:

•An electrician had done work and supplied materials. But, against local bylaws did not hold the required electrical contractors licence.

•Seeking payment a lawsuit arose.

•The judge stated that the purpose of the license was supposed to maintain quality on larger projects, and that by not having a license the electrician was clearly not legally capable of entering into the contract.

5.7.44 Lambert v. Lastoplex Chemicals Co. Limited et. al.

Location: Canada

Court: Supreme Year: 1971

Importance: the high standard of care requires that all users are assumed to be idiots Details:

• Lambert, a mechanical consulting engineer, purchased two cans of sealant for his basement floor.