2016 QCCA 2062, 2016 QCCA 2062

Translated from the original French Montréal (Ville de) c. Compagnie d'assurances Coseco 2016 QCCA 2062 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No.: 500-09-025433-152 (500-22-203498-137) MINUTES OF THE HEARING DATE: December 7, 2016 CORAM: THE HONOURABLE JACQUES CHAMBERLAND, J.A. GENEVIÈVE MARCOTTE, J.A. MARK SCHRAGER, J.A. APPELLANT COUNSEL VILLE DE MONTRÉAL m tre HUGO FILIATRAULT M tre olivier nadon ( Dagenais, Gagnier, Biron ) RESPONDENT COUNSEL COSECO INSURANCE COMPANY Mtre SOPHIE PLAMONDON ( Carter Gourdeau )

On appeal from a judgment rendered on June 10, 2015 by the Honourable Sylvie Lachapelle of the Court of Québec, Civil Division, District of Montreal. NATURE OF THE APPEAL : Municipal – liability – water main break Clerk at the hearing: Marcelle Desmarais Courtroom: Antonio-Lamer HEARING 9:30 a.m. Submissions by Mtre Hugo Filiatrault. 10:11 a.m. Submissions by Mtre Sophie Plamondon. 10:45 a.m. Reply by Mtre Filiatrault. 10:48 a.m. End of submissions on both sides. Recess of the hearing. 11:00 a.m. Resumption of the hearing. Unanimous judgment rendered by the Honourable Mr.

Justice Jacques Chamberland, J.A. – see page 3. Marcelle Desmarais Clerk at the hearing BY THE COURT JUDGMENT [ 1 ] The judgment under appeal orders the appellant (or the “City”) to pay damages to the respondent following a water main break that occurred on November 8, 2012 in the borough of Rivière-des-Prairies/Pointe-aux-Trembles.

[ 2 ] The appellant argues three grounds of appeal which it presents as three errors of law committed by the trial judge. The appellant in fact essentially faults the judge for not finding, on the evidence she had heard, that the City had rebutted the presumption of fault under

article 1465 C.C.Q. [ 3 ] The judge turned the presumption of fault under

article 1465 C.C.Q. into a presumption of liability. She erred by requiring that the City’s evidence, as to its absence of fault, be supported by expert evidence. Finally, she interfered in the political sphere of the City’s decisions regarding water supply system monitoring and maintenance. [ 4 ] The appellant is correct. [ 5 ] It is understood from the outset that

article 1465 C.C.Q. applies here, since the appellant is the owner and custodian of the water supply system. [ 6 ]

Article 1465 C.C.Q. creates a presumption of fault in respect of the custodian. The custodian of a thing is bound to make reparation for injury resulting from the autonomous act of the thing, “unless he proves that he is not at fault/à moins qu’il prouve n’avoir commis aucune faute”. [ 7 ] The custodian must therefore prove that it took reasonable means to prevent the event that caused the damage.

It does not have to prove that the injury was completely unavoidable; rather, it must show that it was impossible for it to prevent the event from occurring through reasonable means having regard to all of the circumstances. It will then have proven that it did not commit any fault.

This is an obligation of means, not of result. [ 8 ] In the present case, the appellant provided this evidence and the trial judge clearly erred by finding that the water supply system maintenance program set up by the City did not meet the standard of a reasonable city. [ 9 ] A number of witnesses explained how the City had maintained its water supply system in recent years, since the municipal mergers in 2001-2002.

The evidence covers the establishment of the Direction de la gestion stratégique des réseaux d’eau (in 2005) and the implementation of an elaborate maintenance and monitoring plan for the water and sewer systems (2005 to 2012) including (1) auscultation of the water supply system (by listening to fire hydrants using an acoustic amplifier), (2) inspection of the valves in the water supply system, (3) inspection of the sewer lines and, finally, (4) the planning of future operations. [ 10 ] This uncontradicted evidence also establishes that the measures put into place by the appellant since 2005 have yielded results.

Indeed, the judge pointed out that [ translation ] “results are starting to be seen”. [1] The rate of breaks per 100 km went from 22 in 2009 to 12 in 2012. [2] [ 11 ] Nonetheless, the judge wondered about the quality of the water supply system maintenance measures implemented since 2005, namely whether they were best practices. She criticized the City for not proving these to be best practices through an independent expert, and for not demonstrating the maintenance measures taken by a city comparable to Montreal.

In addition, she pointed out that the evidence was silent concerning the City’s water supply system maintenance measures prior to 2005. [ 12 ] The judge also noted that the City’s choice to prioritize rehabilitation of certain water mains instead of others was in keeping with budgetary constraints (by complying with the government’s indicators for granting subsidies) and [ translation ] “did not lead to the deduction that it had adopted all reasonable means to prevent damage”. [3] She referred in this regard to the criterion for intervening that had been put into place, namely three breaks per 200 metres of water main in a five-year period to justify an intervention by the City.

In addition, in her view, the City should have taken advantage of the fact that the nearby sections had been rehabilitated to extend this work to the

section located between 13th and 14th Avenues, such that the break in this case could not be qualified as unforeseeable. This was all the more so since, in her opinion, the leak testing set up by the City was not infallible. [ 13 ] It is true that no independent expert contributed to establishing the evidence for the City. The fact remains, however, that the City presented exhaustive evidence of the maintenance measures it had put into place, by explaining, particularly through the testimony of its professionals, including Mr.

Normand Hachey, a civil engineer specializing in hydraulics who had been assigned to the administration of the response plan for the water supply system, the various stages of the response plan, the objectives pursued and the criteria identified by the City in light of best practices in New Zealand, the United States, England and Canada. [4] [ 14 ] Furthermore, the evidence shows that neither the age of the water mains nor their location near sections that had already been rehabilitated could lead to the conclusion that they were likely to break.

The evidence actually establishes that no sign of a possible leak had been detected in the

section of De La Gauchetière Street where the break occurred, between 13th and 14th Avenue, during auscultations of the system in the years preceding the break. Five reports were filed, namely one for each year between 2008 and 2012. In each report (except for 2009), a list of [ translation ] “potential leaks” had been drawn up, but there was nothing for the

section where the break occurred. In fact, the break that occurred on November 8, 2012 is the only one to have been recorded for this

section of the water main. Therefore, the break in question cannot be connected to a lack of response on the part of the City, based on the criterion it had set for itself to only proceed with rehabilitation of a water main (rather than repairing it in case of a break) if there had been three breaks over a distance of 200 m in five years, because no such break had occurred before in the water main in question. [ 15 ] It is true that the evidence sheds very little light on the maintenance measures implemented before 2005.

One may wonder, however, how this can be fatal to establishing the reasonable means taken by the City to maintain its water supply system, given that it did provide evidence of the response plan introduced over the seven years preceding the break in question and given that there had been no break in the water main in question before November 2012. [ 16 ] Lastly, by calling into question the effectiveness of leak testing techniques through the auscultation of fire hydrants, which she stated have their limits and are not infallible, the judge seems to have attributed an obligation of result rather than an obligation of means to the City.

[ 17 ] As this Court stated in Brown c . Hydro-Québec , the City had to prove that it had taken precautions that were reasonable under the circumstances and not that its network was the best. [5] Furthermore, in Just v . British Columbia , [6] the Supreme Court, in a judgment written by Cory J., discussed the scope of the provincial government’s duty with regard to road maintenance as follows: … the frequency and method must be reasonable in light of all the surrounding circumstances.

The governmental agency should be entitled to demonstrate that balanced against the nature and quantity of the risk involved, its system of inspection was reasonable in light of all the circumstances including budgetary limits, the personnel and equipment available to it and that it had met the standard duty of care imposed upon it . [7] [ 18 ] It is also appropriate to recall the words of the author Vincent Karim regarding the burden of proof required to rebut the presumption in

article 1465 C.C.Q. , when he states that the custodian can [ translation ] “prove that the thing was placed or installed in a good and workmanlike manner, that it was maintained on a regular basis and that what happened was not due to any negligence or omission”. [8] [ 19 ] In this particular case, the judge erred when, in light of all the evidence, she found that the appellant had not proved that it had taken all reasonable means to foresee the damage. If the evidence had established that the City does not monitor its system, but merely repairs what breaks, it could have been faulted for that.

Such is not the case, however, at least not according to the evidence in the record. [ 20 ] There is always room for improvement, but that is not the test. A city cannot be required to act without taking into account its financial capacity. The matter involves a balancing act. In this context, the judge erred in blaming the City for having chosen [ translation ] “the best possible strategy at the best possible price”. [9] It goes without saying that the City operates this way.

The contrary would surprise taxpayers. [ 21 ] For these reasons, and without it being necessary to discuss the other grounds of appeal, THE COURT : [ 22 ] ALLOWS the appeal; [ 23 ] SETS ASIDE the judgment under appeal; and rendering the judgment that should have been rendered by the trial court; [ 24 ] DISMISSES the originating application; [ 25 ] The whole with legal costs, both on appeal and in first instance. JACQUES CHAMBERLAND, J.A. GENEVIÈVE MARCOTTE, J.A. MARK SCHRAGER, J.A.