Leokadia Contracting Ltd. (Falcon Bridge Custom Homes) v. Sabre Plumbing Services Inc., 2012 ABQB 585

Court of Queen ’ s Bench of Alberta Citation: Leokadia Contracting Ltd. (Falcon Bridge Custom Homes) v. Sabre Plumbing Services Inc., 2012 ABQB 585 Date: 20120925 Docket: 1103 02447 Registry: Edmonton Between: Leokadia Contracting Ltd. Operating As Falcon Bridge Custom Homes and Richard Lutz Plaintiffs (Respondent) - and - Sabre Plumbing Services Inc., Brett McAllister and John Doe 1 Defendants (Applicants) - and - Top Shelf Closets & Glass Inc., ABC Corporation and John Doe 2 Third Party _______________________________________________________ Reasons for Judgment of the Honourable Mr. Justice T.D. Clackson _______________________________________________________

I. Facts and Circumstances [ 1 ] In this case, the home owner (Respondent) contracted for plumbing services with the contractor (Applicant). The plumbing services were to be rendered during the construction of the owner ’ s new home. In October 2008, a leak was discovered. The owner called upon the contractor and the problem was fixed. In late January 2009, the owner discovered a leak in the master bedroom ensuite. The leak was in the shower area. The owner thought that he might bear some responsibility since he supplied the fixture which leaked.

Nevertheless, the owner called upon the contractor to fix the problem and at the time expected that to be done. The contractor alerted its insurer on February 9, 2009. The owner felt the contractor ’ s insurer would look after any necessary repairs. In late February 2009, after the contractor ’ s insurer denied responsibility, the owner conducted some tests on the fixtures he had supplied and confirmed for himself that the fixtures were not to blame for the leak. [ 2 ] The owner notified his insurer shortly after and investigations were conducted, by his insurer. Ultimately, the owner sued for damages of $50,000.

In the action filed, February 11, 2011, he alleged that the loss occurred February 14, 2009. In fact, the loss occurred late in January 2009. [ 3 ] The contractor applies for

summary dismissal of the owner ’ s claim on the basis that it is plainly barred by the Limitations Act , RSA 2000 c. L-12. II.

Analysis [ 4 ] Plainly, the evidence leads inexorably to these conclusions: 1. the loss occurred more than two years before the claim was filed; 2. the loss was significant; 3. the owner suspected that the contractor was at least partially at fault but was unsure what, if any, responsibility he bore for the loss; 4. the owner was content to the let the contractor ’ s insurer look after the problem; 5. the owner remained uncertain about his responsibility for the loss until he did his testing; 6. testing by the owner was completed within two years of the date the claim was issued. [ 5 ] The Limitations Act provides: 3(1) Subject to

section 11, if a claimant does not seek a remedial order within (a) 2 years after the date on which the claimant first knew, or in the circumstances ought to have known,

(

i) that the injury for which the claimant seeks a remedial order had occurred, (ii) that the injury was attributable to conduct of the defendant, and (iii) that the injury, assuming liability on the part of the defendant, warrants bringing a proceeding, or (b) 10 years after the claim arose, whichever period expires first, the defendant, on pleading this Act as a defence, is entitled to immunity from liability in respect of the claim.

(2) The limitation period provided by subsection (1)(

a) begins . . . (

b) against a principal when either (

i) the principal first acquired or ought to have acquired the knowledge prescribed in subsection (1)(a), . . .

(5) Under this section, (

a) the claimant has the burden of proving that a remedial order was sought within the limitation period provided by subsection (1) (a), and . . . A. Attributable to the Contractor [ 6 ] The owner argued that the loss was not known to be definitely attributable to the contractor until he did his tests. [ 7 ] The owner was well versed in construction, had a fair bit of knowledge about plumbing and had experience in making insurance claims. This was not a complicated fact situation and the owner admitted as much. He felt that the contractor was responsible but he might also have to bear some responsibility.

In the circumstances, there is no doubt that the owner felt and acted as if the loss was attributable to the contractor. [ 8 ] This is not a case where a difficult legal or factual determination had to be made as to the cause of the loss before attribution for the loss could be made: Guay v. Wong , 2008 ABQB 638 ; Goldencare Holdings Ltd. v. Manu Chugh Architect Ltd., 2006 ABQB 696 ; Elbow Valley Joint Venture Corp. v. Walker, Newby & Partners Inc. , 2003 CarswellAlta 645 (QB Master) . [ 9 ] Rather, this case is more akin to Marceau, J. ’ s decision in Moore v. 477470 Alberta Ltd., 2003 ABQB 294 .

Plainly the owner, by his actions, had more than a suspicion that the contractor was at fault: Deshazo v. Nations Energy Co. , 2005 ABCA 241 . In my view, the owner believed that the injury he suffered was attributable at least in part to the contractor, in January 2009. That is sufficient knowledge to start the time running.

B. Warrants of Proceeding [10] The owner also argued that he did not know that the loss warranted bringing a proceeding until the end of February 2009.The assessment of whether a proceeding is warranted requires some assessment of the practicalities of litigation including assessment ofthe reasonableness of suing someone who may be liable and whose liability may be anywhere from 0% to 100%. The potential value ofthe injury is also a relevant consideration. [11] In Condominium Plan 9421549 v.

Mainstreet Developments Ltd., (AB KB), 2004 ABQB 962, I hadoccasion to outline some of the questions which a reasonable person would consider in determining whether a proceeding is warranted.In this case, the evidence admits of different inferences. One could infer that the contractor would reasonably be expected to bearsufficient responsibility for the loss so as to justify suit against it. One could also infer that the loss was large enough that even if thecontractor was only partly responsible, its responsibility was sufficient to warrant action. However, neither inference is compelled by theevidence.

The competing inferences are that in the absence of better information, the contractor might be marginally responsible at mostand the value of the responsibility, minimal. Paragraph 3(1)(a)(iii) of the Act requires the Court to discover what a reasonable personwould do and apply that standard as against what the owner actually did. In my view, it would be reasonable where competing inferencesare equally plausible to explore further to resolve the matter. In this case, that is what the owner did when he conducted his testing late inFebruary 2009.

At that point he learned enough to make it reasonable to conclude that proceedings were warranted. Since that discoverywas made within two years of the date of filing, the action is not statute barred. It follows that the application by the contractor must bedismissed. [12] The parties may address the matter of costs on appointment. Heard on the 5th day of September, 2012. Dated at the City of Edmonton, Alberta this 25th day of September, 2012. T.D. Clackson J.C.Q.B.A. Appearances: Carter D. Greschner Bryan & Company LLP for the Plaintiffs (Respondent) J.

Faye Armfield Chomicki Baril Mah LLP for the Defendants (Applicants)

J. Faye Armfield Chomicki Baril Mah LLP for the Third Party