2020 QCCA 260, 2020 QCCA 260

Unofficial English Translation of the Judgment of the Court Construction et location Jenik inc. c. Jenkins 2020 QCCA 260 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No.: 500-09-027645-183 (500-17-089004-157) DATE: February 18, 2020 CORAM: THE HONOURABLE JACQUES J. LEVESQUE, J.A. ROBERT M. MAINVILLE, J.A. PATRICK HEALY, J.A. CONSTRUCTION ET LOCATION JENIK INC. APPELLANT – Plaintiff v. ALCIDE JENKINS RESPONDENT – Defendant JUDGMENT [ 1 ] The appellant appeals from a judgment rendered on May 24, 2018, by the Honourable Mr.

Justice Kirkland Casgrain of the Superior Court, District of Montreal, dismissing its action for damages for lack of evidence of the quantum of damages. [1] *** [ 2 ] In short, the appellant acquired the shares of a company that owned an immovable at the time. The share purchase and sale agreement contained a guarantee that each member of the company had always observed and complied with environmental laws and that the immovable complied with those laws. In fact, the sellers undertook to indemnify the purchaser for any loss suffered or incurred if any representation or warranty were inaccurate or false.

The evidence established that the land was contaminated by manganese and chromium. The appellant claimed the cost of decontamination, as established by its evidence. [ 3 ] The judge dismissed the action, criticizing the appellant for having limited itself to establishing the cost of the first of the two options recommended by an expert, that is, the off-site management of the contaminants. The expert described the two options as follows: [ translation ] The 2 possible site rehabilitation options are to continue excavation of the non-compliant landfill (> criteria

C) and manage it off-site in a location authorized by the MDDEFP or to manage the site by risk analysis (with contaminants maintained on the site) through a variety of related work including additional characterization work, registration of notices in the land registry, the risk analysis itself, and the need to carry out certain work following the results of the risk analysis (for example, excavation of 0.4 m on the surface, complete repaving of the contaminated area, etc.). [ 4 ] On his own initiative, the judge calculated that the second option would have been less costly.

He added that even the cost assessment for the first option was tricky because the expert mentioned that the specific actual cost would only be known once the immovable was decontaminated. *** [ 5 ] The appellant raises three grounds of appeal: (1) that the judge based his decision on a solution that was not raised in the proceedings and for which it was unable to adduce the required evidence, thereby contravening the rules of natural justice; (2) that the judge failed to point out to the parties a deficiency in the evidence; and (3) that the judge erred in placing the burden of proving the cost of the option of on-site decontamination on the appellant. [ 6 ] On appeal, the respondent added a new argument: that the action was prescribed. [ 7 ] Last, it should be noted that the argument raised by the respondent at trial with respect to extinction of the debt by confusion of

the creditor and the debtor (art. 1683 C.C.Q.), which was rejected by the judge, is no longer being challenged on appeal. *** [ 8 ] The first two grounds of appeal are unfounded. The appellant is wrong to claim that the judge ruled on the basis of an element that the parties had not had the opportunity to debate or that he did not point out a deficiency in the evidence. The appellant knew that a second rehabilitation option was possible and chose not to have the costs of that option assessed. The issue was discussed at the hearing, and the judge communicated his concern to the parties a few times.

It is primarily the parties’ responsibility to prepare and adduce the evidence required to support their submissions, and art. 268 C.C.P., which allows a judge to point out deficiencies in the evidence, is not a means to redress a strategic choice. [2] [ 9 ] However, the third ground of appeal is well founded. [ 10 ] The appellant chose to claim compensation for its loss by favouring off-site decontamination. An expert also recommended another option, that is, on-site management of the risk.

By not studying that option, the appellant took the risk of having the respondent set up such a study against it at the trial. [ 11 ] If the respondent considered that the appellant could minimize its loss by on-site risk management, it was incumbent upon him to adduce that evidence. [3] In finding that there was no evidence of loss on the ground that the cost of the on-site risk management had not been assessed, the judge erroneously reversed the burden of proof, even though the defence did not raise in its proceedings any breach of the duty to mitigate damages.

Moreover, the judge’s comment that the latter option was more costly is merely speculative in the absence of any evidence in the record. [ 12 ] The expert report on the costs of off-site decontamination was adduced into evidence, and the expert testified. The respondent did not challenge the expert’s qualifications or the merits of the expertise, nor did he adduce a second opinion.

The difficulty in assessing the cost of decontamination with mathematical precision is no reason to refuse to compensate a loss. [4] [ 13 ] That said, the cost of decontamination suggested was not established with certainty because the testimony of the appellant’s expert showed a 20% margin of error in the assessment of those costs. [5] In light of this uncertainty, it is appropriate to arbitrate the appellant’s initial claim of $2,154,478.40 accordingly. *** [ 14 ] Last, the respondent invokes the prescription of the action.

Although art. 2881 C.C.Q. allows prescription to be invoked at any stage of the proceedings, it is not always possible to raise it for the first time on appeal, particularly when the starting point of the prescription is a question of fact. [6] The facts or inferences relied on by the respondent could have been contradicted by the appellant with other evidence if the issue had been raised in a timely manner.

FOR THESE REASONS, THE COURT: [ 15 ] ALLOWS the appeal in part; [ 16 ] REVERSES the trial judgment; [ 17 ] GRANTS in part the originating application; [ 18 ] CONDEMNS the respondent to pay the appellant $1,723,582.72, with interest at the legal rate, plus the additional indemnity set out in art. 1619 C.C.Q., as of April 29, 2015; [ 19 ] With legal costs, both in first instance and on appeal. JACQUES J. LEVESQUE, J.A. ROBERT M. MAINVILLE, J.A. PATRICK HEALY, J.A.

Mtre Nathalie Charron CROCHETIÈRE PÉTRIN For the appellant Mtre Daniel Robert MARTIN, CAMIRAND, PELLETIER For the respondent Date of hearing: February 6, 2020