Dennis Hilling, Westerleigh Farms Ltd. v. Dencar Agri Ltd., 2014 SKPC 167

IN THE PROVINCIAL COURT OF SASKATCHEWAN CIVIL DIVISION Citation: 2014 SKPC 167 Date: October 22, 2014 File: SC #205 of 2013 Location: Saskatoon _____________________________________________________________________________ Between: Dennis Hilling, Westerleigh Farms Ltd. and Dencar Agri Ltd. - and - Saskwest Financial Ltd. Appearing: Dennis Hilling For the Plaintiffs Grant Richards For the Defendant JUDGMENT D.E.

LABACH , J INTRODUCTION [ 1 ] On December 10, 2012, the Plaintiff, Dennis Hilling, purchased a used 2008 Ford F550 truck from the Defendant, Saskwest Financial Ltd., for the sum of $28,285.00 plus GST and PST. Mr. Hilling picked up the truck at the Defendant’s place of business in Saskatoon and drove it to his farm in the Moose Jaw district. He experienced some mechanical problems along the way and when he

finally pulled into his farmyard, the truck died. [ 2 ] The next day, Mr. Hilling was able to get the truck going and he took it in to a Ford dealership in Moose Jaw to diagnose the problem. Later that day, the dealership advised the Plaintiff that the truck needed a new engine. [ 3 ] On January 31, 2013, Mr. Hilling had a rebuilt engine installed in the truck at a cost of $11,966.95. Mr. Hilling alleges that the Defendant misrepresented the truck as being in excellent condition and with warranty when they knew about the problems with the engine and that it was without warranty.

He is claiming for the costs associated with diagnosing the problem, purchasing and installing the rebuilt engine and pursuing this matter in Small Claims Court. FACTS [ 4 ] The Defendant, Saskwest Financial Ltd., carries on the business of repossession and liquidation. In the normal course of business, they are contacted by a client about repossessing things, the client forwards them a warrant legally authorizing them to take possession of the items on the client’s behalf, they attend to repossess the items, they store the items, repair the items if necessary and then sell them for the client.

When they tender the items for sale, they take bids. They forward all of the bids they receive to the client. If the client accepts a bid, they get authority from the client to sign the bill of sale on the client’s behalf. They collect the selling price from the successful bidder, deduct their fees and disbursements and forward the balance to the client. It does not appear that the agency relationship between the Defendant and their client is disclosed to a purchaser. [ 5 ] Keith Harelkin is the president, sole shareholder and director of the Defendant company.

He has been in the repossession and liquidation business for 37 years. According to him, he does “all the grunt work”. He has an office manager by the name of Michelle Myers who looks after all the paperwork, including advertising items for sale and preparing the bills of sale. After listening to Mr.

Harelkin’s testimony, it was obvious that repossessing and selling vehicles was a regular part of his business. [ 6 ] In this particular case, the Defendant was contacted by Woodpath Investments, a leasing company in Edmonton, Alberta, to seize three trucks - a 2008 Ford F550 with a 6.7 litre engine, a 2008 Ford F550 with a 6.4 litre engine and a 2008 Ford F350. They received the warrant authorizing seizure, they located the trucks in northern Alberta, repossessed them and brought them to their compound in Saskatoon. Mr. Harelkin appears to have been involved in the repossession.

After repossessing the trucks, Mr. Harelkin drove one of the 2008 Ford F550s five hours to get it back to Saskatoon. During his trip, the diesel cleaning warning light came on three separate times. The next day after the truck was parked in his compound, he noticed the engine was running rough and it was down a litre of oil. [ 7 ] Mr. Harelkin said that on November 7, 2012, he took this particular truck to Merlin Ford Lincoln, a Ford dealership in Saskatoon, with a complaint that the truck was “missing” when you stepped on the gas.

He also supplied some rear rotors for the truck and asked the dealership to install those. However, the work order from Merlin Ford Lincoln for this truck for November 7 th states that the truck was towed in and that the four reasons the truck was brought in were (1) missing idle and blowing blue smoke under load, (2) install customer supplied rear rotors, (3) report on cause of no reverse lights, and (4) report on cause of oil leak. [ 8 ] The truck that Mr. Harelkin had towed in to Merlin Ford was the Ford F550 with the 6.4 litre engine, VIN # 1FDAF57R78EA56712.

The service manager at the dealership was Gary Reding. Prior to being the service manager, Mr. Reding was a technician for 6 years and the shop foreman for 13 years. He is a Ford master technician with a diesel certification. With the consent of the Defendant, he was qualified as an expert in the diagnosis, repair and replacement of Ford engines, particularly Ford Superduty engines. Mr. Reding and his technicians looked at the truck and noticed that there was water in the diesel fuel, chips out of the turbo charger and particles in the engine’s combustion chamber. They described this condition as “dusting”.

They submitted a claim to Ford to see if the problem was covered under warranty. Unfortunately it was not. According to Ford, this problem was due to a lack of maintenance. [ 9 ] As for the other problems, the service technician determined that the reverse lights were not working because of a burned out fuse. The fuse was burned out because of a “ short to ground”. The oil leak was caused by a seized turbo charger.

[ 10 ] Merlin, changed the rear rotors and fixed the truck’s reverse lights. Then Mr. Reding contacted Mr. Harelkin and told him about the “dusting” problem and that Ford would not cover the problem under warranty. Mr. Harelkin was upset that Ford had denied the claim and asked Mr. Reding to take another look at the engine. [ 11 ] Based on this request, Mr. Reding and his technicians took some of the engine apart. When they did, they noticed that the cylinder walls were scored and dusted and the turbo charger was damaged. This just confirmed their original diagnosis of the dusting problem. Mr.

Reding testified that to fix this problem you would have to replace the bottom part of the engine and install a new turbo charger. The cost to replace the engine would be somewhere between $10,000.00 and $12,000.00 and the cost of a turbo charger was another $2,200.00 over and above that. [ 12 ] Mr. Reding conveyed this information to Mr. Harelkin. Mr. Harelkin in turn, contacted his client, Woodpath Investments, to seek instructions as to what they wanted to do. Mr. Harelkin told his client that he did not have confidence in Merlin Ford Lincoln’s diagnosis.

As a result, it was decided to just put the truck back together without fixing the problem and sell it. [ 13 ] Mr. Harelkin got back to Mr. Reding and instructed him not to fix the truck but rather to just put the engine back together. So, on December 4, 2012, the service department at Merlin Ford Lincoln reassembled the engine on this truck and someone from the Defendant company came and got it and drove it back to the Defendant’s business premises. [ 14 ] Before returning the truck to the Defendant, Mr. Reding made it clear that the warranty on the engine was void as a result of this unresolved dusting problem.

The invoice from Merlin Ford Lincoln stated in part, “ . . . . Customer informed vehicle may not run or run well after reinstall. Customer auth reinstall. Test run and install. Vehicle runs rough vehicle has excessive blow by. Not recommended that the vehicle is driven due to the possibility of run away conditions.” He explained that this meant that the truck was not safe to drive because oil could be sucked into the engine as a result of this problem. [ 15 ] While all this was going on, Ms.

Myers, the Defendant’s office manager arranged to put an advertisement in the Western Producer as follows: REPOSSESSED, ATTN CONTRACTORS/RANCHERS 2008 Ford F550, 4 x 4, dually, fully loaded, 6.7 L diesel, auto w/12' deck, power train warranty until May 31, 2013, excellent condition, only 65,000 kms. E-mail Saskwest Financial @sasktel.net for photos and bidding instructions. Sold to the highest bidder.

This ad appeared in the Western Producer on November 8, 15, 22 and 29, 2012. [ 16 ] In November 2012, the Plaintiff, Dennis Hilling, was looking for a service truck for his farming corporations, Westerleigh Farms Ltd. and Dencar Agri Ltd. In the November 22 nd issue of the Western Producer, he saw the aforementioned advertisement for the repossessed 2008 Ford F550. In addition to the ad, there was a picture of the truck. [ 17 ] On November 27 th , Mr. Hilling left a phone message and sent an email to the Defendant requesting some particulars about the truck that was in the advertisement.

On November 30 th , the Plaintiff received an email from the Defendant advising that the serial number of this truck was 1FDAF57 R78EA56712 as well as some pictures of the truck.

Included in this email was a warning from the Defendant that it was the bidder’s responsibility to verify the powertrain warranty themselves, that the bidder was to make their decision whether to submit a bid based on the photos and that if their bid was accepted, they could start up the truck, back it up, etc. [ 18 ] On November 30 th , the Plaintiff went to the Moose Jaw Ford dealership to see what, if anything, he could find out about this truck. The dealership directed him to call the Ford Canada Customer Relationship Centre..

He did, and was told that on this particular truck, the three year/60000 kilometre basic warranty was expired however the five year powertrain warranty was still valid as were all other under mileage limit warranties.

[ 19 ] Mr. Hilling then called CarFax to see what they could tell him about the truck. CarFax is a business that provides vehicle history information to people for a fee. In this case, CarFax told him that this truck was initially purchased new in Arizona and then later sold to someone who brought it to Calgary, Alberta. [ 20 ] Based on the November 22 nd advertisement in the Western Producer and specifically that it said that the truck was in “excellent condition” and that it had a “powertrain warranty until May 31, 2013" and the CarFax report dated December 5 th , Mr.

Hilling emailed a bid of $28285.00 to the Defendant for this particular truck. On December 6 th , the Defendant advised Mr. Hilling by return email that his bid had been accepted. [ 21 ] On December 10 th , Mr. Hilling and his hired man drove to the Defendant’s place of business in Saskatoon to have a look at the truck and pay for it. When he arrived at the Defendant’s business premises, he got the keys from one of the Defendant’s employees. They also gave him a mechanical safety inspection report for the truck. However, he was told that he could not take the truck off the Defendant’s lot. Mr.

Harelkin did not speak to Mr. Hilling because he was not there at the time. Mr. Harelkin was in Mexico from December 3, 2012 until March 18, 2013. [ 22 ] Unbeknowst to Mr. Hilling, he was not given the keys to the 6.7 litre Ford F550 truck that was offered for sale in the Western Producer in November 2012 and the one that Mr. Hilling understood he had successfully bid on. Mr. Harelkin said that the truck the Plaintiff was shown on December 10th was the 6.4 litre Ford F550 truck. Mr. Harelkin did not know why Mr. Hilling was not given the 6.7 litre truck in the ad. Nobody told Mr.

Hilling that the truck he had successfully bid on was not the truck in the Western Producer ad or that the truck he was inspecting on December 10 th was not the truck in the ad and only had a 6.4 litre engine, a dusting problem, no warranty and needed significant engine repairs to make it roadworthy. [ 23 ] Neither Mr. Hilling nor his hired man were mechanics but he started up the truck, drove it forward and backward and it appeared to be running fine. He walked around the truck and inspected it. He noticed damage to one door and minor damage to the rear deck bumper.

He looked underneath the truck for leaks and did not see any. He also checked the tires and they appeared to be satisfactory. He reviewed the mechanical safety inspection report provided by the Defendant and it did not identify any problems. [ 24 ] Mr. Hilling and his hired man spent 15 to 20 minutes looking at the truck. Everything seemed to be working and the truck appeared to be running fine. The truck appeared to be just as the ad described. Ignorant that he was being sold a different truck than he bid on, Mr.

Hilling signed the bill of sale and gave the Defendant a certified cheque for $28285.00 plus G.S.T. and P.S.T. He went to a motor licence issuer, got a licence plate for the truck and drove it back to his farm. [ 25 ] The bill of sale signed by the parties and dated December 10, 2012, read as follows: WE, SASKWEST FINANCIAL LTD., HEREBY SELL TO Dennis L. Hilling; Dencar Agri Ltd.; Westerleigh Farms Ltd.,. OF Box 1539, Moose Jaw, Sk.

S7H 7A8 the following described chattel: 1 - 2008 Ford F550 S/N 1FDAF57R78EA56712 FOR THE SUM OF TWENTY-EIGHT THOUSAND TWO HUNDRED AND EIGHTY-FIVE DOLLARS ($28,285.00) PLUS the GST of ($1,414.25) AND THE PST OF ($1,414.25) for a grand total of:

THIRTY ONE THOUSAND ONE HUNDRED AND THIRTEEN DOLLARS AND 50/100 ($31,113.50) THIS CHATTEL IS SOLD IN AS IS WHERE IS CONDITION WITH THE FULL UNDERSTANDING THERE ARE NO WARRANTIES EXPRESSED OR GIVEN. ANY MANUFACTURER WARRANTY IS AT THE RESPONSIBILITY OF THE BUYER TO VERIFY. THIS CHATTEL IS ALSO SOLD WITH THE FULL UNDERSTANDING THERE ARE NO LIENS OR ENCUMBRANCES OWING TO OR AGAINST IT. [ 26 ] Mr. Hilling stopped at an Esso gas station on the southeast edge of Saskatoon and filled the truck up with diesel fuel. He noticed that the oil was a bit low so he added a litre of 15W40 oil.

Then he began driving back to Moose Jaw. [ 27 ] Mr. Hilling was about 42 kilometres from Saskatoon when he noticed that the truck had started a recycle of the exhaust filter. Ten to fifteen minutes later, the recycle was complete. About an hour and a half later, as he was going past the town of Aylesbury, the recycle started again. Just as he pulled into his farmyard, the engine died and a message came up on the dashboard to pull to the side of the road. [ 28 ] Mr. Hilling tried starting the truck again but he could not get it going.

He and his hired man checked the oil level and the dipstick showed that there was no oil in the engine. Mr. Hilling put in 5 litres of 15W40 oil to bring the oil level up to the appropriate level. Once he did this, he was able to start the truck. He moved it, parked it for the night and plugged it in. [ 29 ] On December 11 th , Mr. Hilling started the truck and took it to Moose Jaw Ford to see if they could identify the problem he had the previous day.

That afternoon, the dealership called him and told him that a Ford Customer Data Link dated November 27, 2012 indicated that the engine warranty on this particular truck had been voided due to lack of maintenance and that as a result, Saskwest Financial had been denied an engine replacement. Moose Jaw Ford did a scan on the truck but it did not show when the problem with the engine occurred. The best they could tell Mr. Hilling was that the problem occurred prior to November 27, 2012. Mr.

Hilling asked the Service Manager at Moose Jaw Ford why he was not advised of this problem when he contacted the Ford Canada Customer Relationship Centre on November 30 th . The Service Manager advised him that he would not have been given a copy of this Customer Data Link because he was not the owner of the truck. Only the truck owner could get this information. [ 30 ] Mr. Hilling tried calling Mr. Harelkin on December 12th to speak to him about these problems. However, Mr. Harelkin was not in and all he could do is leave a message. He left three or four messages but Mr.

Harelkin never returned his calls. [ 31 ] Moose Jaw Ford told Mr. Hilling that the engine needed to be replaced. They quoted him $24,000.00 to do the job. Mr. Hilling thought that this was expensive. Eventually he bought a rebuilt engine from SGI salvage and on January 31, 2013, Village Ford in Moose Jaw put the engine in. The total cost to purchase and install this rebuilt engine was $11,966.95. ISSUES

a) Did the Defendant misrepresent the condition of the truck?

b) If yes, what damages, if any, are the Plaintiffs entitled to? ANALYSIS

a) Did the Defendant misrepresent the condition of the truck? [ 32 ] The Plaintiffs cannot rely on the statutory protections provided in The Consumer Protection Act , S.S. 1996, c. C-30.1 or its

[32] The Plaintiffs cannot rely on the statutory protections provided in The Consumer Protection Act, S.S. 1996, c. C-30.1 or itssuccessor, The Consumer Protection and Business Practices Act, S.S. 2013, c. C-30.2 because the Defendant is a liquidator. Both ofthese Acts specifically exempt liquidators from the definition of retail seller ergo making them exempt from the various warranties setforth in these Acts. [33] The Defendant argues that this transaction is governed by the legal principle of caveat emptor or “let the buyer beware”.

Thebill of sale they say is clear that the truck was sold in “as is where is condition” and that there were no warranties “expressed or given”. [34] Under the doctrine of caveat emptor, where there is no evidence of fraud, the purchaser cannot complain of defects in aproduct that they have had an opportunity to inspect before purchase. It is the purchaser’s responsibility to obtain a warranty on theproduct before agreeing to buy it. In the absence of an express warranty, the purchaser has no redress. See Rowsell v. Auto Source Inc.,[2000] N.J. No. 33 (Nfld. Prov. Ct.) at paragraph 36; Bartlett v.

Sidney Marcus Ltd., [1965] 2 All E.R. 753 at page 755. [35] In Frey v Sarvajc, 2000 SKQB 281 , [2000] S.J. No. 382 (Sask.Q.B.), the Saskatchewan Court of Queen’s Benchdealt with a case involving the sale of a used automobile. In speaking to the applicability of the doctrine of caveat emptor to the sale ofused vehicles, Madame Justice Wilkinson said: [17] The application of these principles to the sale of used cars is summarized in the comments of Gow J. in Rushak v Henneken, [1986]B.C.J.

No. 3072 (S.C.) where he states: At a common law in the absence of a fiduciary or analogous relationship, there is not as between negotiating parties any duty ofdisclosure. Almost always the seller of a used car knows of its defects, or at least some of them, but he is not under any duty to disclosethem to a potential buyer, unless there has been on his part active concealment, that is, he has done something to the car with intent toprevent the defect being discovered.

Leeson v Darlow, (ON CA), [1926] 4 D.L.R. 415 at p. 432; Allen v McCutcheon(1979), (BC SC), 10 B.C.L.R. 149; Sorensen v Kaye Holdings Ltd. (1979) (BC CA), 14 B.C.L.R. 204per Lambert, J.A. at p. 235. The common law rule is caveat emptor. The underlying philosophy of the law of contract is that “a party isexpected to look out for himself, and make his own bargains. If he has done foolishly, this is his own fault and he is left to his owndevices”. [36] She accepted that fraud impacted the rule of caveat emptor and at paragraph 16, quoted with approval the Ontario Court ofAppeal decision in McGrath v.

MacLean (1979), (ON CA), 95 D.L.R. (3d) 144 that: . . . Fraud can be a rather elastic conception, and there are cases which show a tendency to find fraud when there has been concealmentby the vendor of latent defects. . . On the other hand, a latent defect of quality . . . which is either unknown to the vendor or such as notto make him chargeable with concealment or reckless disregard of its truth or falsity will not support any claim of redress by thepurchaser. [37] Finally at paragraph 18, Madame Justice Wilkinson explained the difference between patent and latent defects.

She said: [18] The distinction between patent and latent defects is described in Halsbury’s Laws of England (3d ed.) Vol 34, page 211, para. 353 asfollows: Defects of quality may be either patent or latent. Patent defects are such as are discoverable by inspection and ordinary vigilance on thepart of a purchaser; latent defects are such as would not be revealed by any inquiry which a purchaser is in a position to make beforeentering into the contract for purchase.

As regards patent defects, the vendor is not bound to call attention to them; the rule is caveatemptor; a purchaser should make inspection and inquiry as to that which he is proposing to buy. [38] Thus caveat emptor only applies where there is no fraud on the part of the vendor. If the vendor has concealed a latent defectthen “buyer beware” does not apply. See also Wong v. Wruck, [2008] S.J. No. 511 (Sask. Prov.Ct.) at paragraphs 17 to 20; Kinzie v.Manson, [2004] S.J. No. 148 (Sask.Prov.Ct.) at paragraph 13.

[ 39 ] A fraudulent misrepresentation is a false statement made by one party to another. The party making the statement must know it was false or made it recklessly without knowing whether it was true or false. The statement made must have induced the purchasing party to enter into the agreement. See Casillan v. 565204 B.C. Ltd. , [2009] B.C.J. No. 1952 (B.C.S.C.) at paragraph 20 , Wong v.

Wruck , supra, at paragraph 21. [ 40 ] In the present case, the information in the Defendant’s advertisement that their office manager placed in the November 8 th , 15 th , 22 nd and 29 th editions of the Western Producer was false. They were offering a 2008 Ford F550 truck with a 6.7 litre diesel engine for sale to the highest bidder that was in excellent condition and had a powertrain warranty until May 31, 2013. Yet Mr. Harelkin, in his testimony, surmised that that truck had been sold.

There were no other ads in these editions of the Western Producer wherein the Defendant was offering any other trucks for sale. [ 41 ] This was the ad that Mr. Hilling responded to. He emailed the Defendant and asked for more particulars. In response, the Defendant sent Mr. Hilling the serial number and some pictures of a truck. These pictures were not entered into evidence so what specific truck they were pictures of, the Court has no idea.

But the Defendant did not send him the serial number for the truck in the ad nor did they tell him that the serial number they did send him was for a truck that only had a 6.4 litre engine and other problems even though the Defendant knew of these problems at the time they were corresponding with Mr. Hilling. As far as Mr. Hilling was concerned, the pictures and serial number he received were for the truck described in the ad. [ 42 ] The information in the ad that the truck was in excellent condition and had a powertrain warranty induced Mr. Hilling to bid on the truck.

The CarFax check on the truck showed no issues and Ford Canada confirmed that based on their information at that time, there was a powertrain warranty on the truck. These were material facts that, as Mr. Hilling said, he relied on in deciding to purchase the truck. On December 5 th , he put in a bid for the truck and on December 6 th , he was advised that his bid was successful. Of course he thought he had successfully bid on the truck in the ad whereas in reality, that was not the case. Again, the Defendant did not tell him otherwise. [ 43 ] Even when Mr.

Hilling went to look at the truck at the Defendant’s business premises on December 10 th , he was not told that this was not the truck in the Western Producer ad but instead, was a 2008 Ford F550, 6.4 litre with engine problems and a voided engine warranty. All he was told was that he could not take the truck off the Defendant’s lot but could only look at it and drive it back and forth. [ 44 ] Mr. Hilling was a farmer and had a working knowledge of vehicles and engines, as did his hired man. But neither of them were mechanics. I accept Mr.

Hilling’s testimony that he would have taken the truck to a mechanic before paying for it but since the Defendant’s employee said that he could not take it off the lot , he did not believe that he could to that. Understandably, their cursory inspection did not reveal the dusting problem, the problem with the turbo charger or any other problems the truck may have had. As Mr. Reding testified, these problems would not be evident on a cursory inspection and only a mechanic could have properly diagnosed them. [ 45 ] Moreover, even though the Ford Canada Customer Centre had told Mr.

Hilling that the powertrain warranty was still valid, the Defendant knew otherwise. Yet, the Defendant did not tell Mr. Hilling that the warranty had been voided due to maintenance issues. Mr. Hilling could not get this information because he was not the owner of the truck but also, I expect, because the warranty had just been voided in November and that info had not yet made its way to the Ford Customer Service Centre. [ 46 ] The dusting problem in the engine, the problem with the turbo charger and the voided warranty were not patent defects; they were latent defects.

They were not discoverable by inspection and ordinary vigilance. They were defects that Mr. Hilling could not have determined before paying for the truck given the Defendants would not let him take the truck off their lot or take it for a test drive short of driving it back and forth. [ 47 ] Finally, I am satisfied that the Defendant knew that what they put in their ad in the Western Producer in November 2012 and what they were selling Mr. Hilling were not the same truck. They had repossessed both of these trucks. The evidence establishes that only the 6.4 litre truck had problems.

The Defendant knew which truck had the problems and which one did not and when Mr. Hilling showed up to inspect and pay for the 6.7 litre truck in excellent condition with the powertrain warranty they did not show him that truck. Instead, they gave him the 6.4 litre truck that had no warranty and needed an engine. Even if I am wrong in drawing this inference, the

evidence establishes that the Defendant should have made certain that they showed Mr. Hilling the truck they were advertising in theWestern Producer in November 2012, or if that truck was no longer available, tell him that, but they did not,. Thus at the very least, theDefendant was reckless in whether they showed Mr.

Hilling the truck they advertised or not. [48] In conclusion, the Defendant put an ad in the Western Producer for a truck and based on the information in that ad, thePlaintiff was induced to put in a bid on that truck, His bid was successful but when he went to inspect the truck and pay for it, theDefendant gave him a different truck that had significant problems. The Defendant knew that he was giving the Plaintiff the wrongtruck or was reckless in ensuring that he was given the proper truck or not.

These problems were not discoverable on ordinary inspectionand were serious problems that were contrary to what was represented in the ad. Despite this, the Defendant did not advise the Plaintiffthat this was a different truck with problems but kept that information to themselves. This was a fraudulent misrepresentation that oustedthe application of the caveat emptor principle and makes the Defendant liable for damages which flow from this misrepresentation.

b) If yes, what damages, if any, are the Plaintiffs entitled to? [49] In Wong v. Wruck, supra, my sister judge, Judge Scott, properly set forth the law as it relates to damages formisrepresentation.

There she said: [44] A person induced to enter into a contract by a misrepresentation is entitled to either (1) compensation for damages resulting fromthe misrepresentation or; (2) rescission or setting aside of the contract (Waddams, supra, para. 416; Groneau, supra, para. 18). [45] In the present case, the plaintiff has not sought rescission, or setting aside of the transaction, but rather damages related to therepair of the rebuilt engine. [46] The Court has found the defendant misrepresented the facts with respect to the truck’s warranty, accident history and insurancestatus and is therefore liable for damages flowing from his misrepresentations.

There must be a causal link between the damagesawarded and the misrepresentations made (Flaman v. Regina Motor Products

(1970) Ltd., (SK CA), [1991] 5W.W.R. 557 (Sask. C.A.)). [50] Here, Mr. Hilling thought that he had bought a truck with a 6.7 litre engine that was in excellent condition and had apowertrain warranty for another six months. However the truck only had a 6.4 litre engine, a number of serious problems and theengine warranty was voided due to lack of maintenance. The engine had a dusting problem and the turbo charger was seized and leakingoil. The Defendant knew that the engine needed to be replaced and that failure to do so would render the truck unsafe to drive. MerlinFord Lincoln told the Defendant all of this.

Thus to put the truck in excellent condition another engine would have to be installed in thetruck. If the warranty on the truck was still valid, Mr. Hilling would have been able to get an engine installed at no cost to himself. Instead, he paid for an engine to be put in the truck out of his own pocket.

He did not buy a brand new engine but found a rebuilt engineand had it put in at half the cost of a new one. [51] Therefore, judgment will issue against the Defendant, Saskwest Financial Ltd., in favor of the Plaintiff, Dennis Hilling, in theamount of $605.00 being the cost of the scan done by Moose Jaw Ford to diagnose the problem with the truck and $11,966.95, being thecost to purchase and install the rebuilt engine in the truck.

The Plaintiff, Dennis Hilling, will also have his costs in this matter in theamount of $110.00 and prejudgment interest from January 31, 2013, the date the rebuilt engine was installed in the truck to the date ofthis judgment. There was no evidence that the Plaintiffs, Westerleigh Farms Ltd. or Dencar Agri Ltd. incurred any damages as a result ofthis misrepresentation made by the Defendant.

The evidence establishes that the Plaintiff, Dennis Hilling, paid for the scan and therebuilt engine himself and as a result, I decline to award judgment in the name of either of the two corporate Plaintiffs. _________________________ D.E. Labach, J