Embil v S Maric Construction Ltd et al, 2018 MBCA 68

Citation: Embil v S Maric Construction Ltd et al, 2018 MBCA 68 Date: 20180608 IN THE COURT OF APPEAL OF MANITOBA Coram: Madam Justice Barbara M. Hamilton Madam Justice Holly C. Beard Mr. Justice Marc M. Monnin Docket: AI17-30-08943 ) BETWEEN : ) ) JOHN EMBIL ) ) (Applicant) Respondent ) ) - and - ) ) S. Maric Construction ltd. ) ) (Respondent) Appellant ) D. G. Hill ) for the Appellant - and - ) S. Maric Construction Ltd. ) lloyd secter ) ) D. I. Marr (Respondent) ) for the Appellant L. Secter ) - and - ) ) R. S. Literovich and Docket: AI17-30-08949 ) K. R.

Poetker BETWEEN : ) for the Respondent ) JOHN EMBIL ) ) Appeal heard and (Applicant) Respondent ) Decision pronounced: ) June 8, 2018 - and - ) ) lloyd secter ) ) (Respondent) Appellant ) - and - ) ) S. Maric Construction ltd. ) ) (Respondent) ) On appeal from 2017 MBQB 155 HAMILTON JA (for the Court): [ 1 ] The respondent general contractor, S.

Maric Construction Ltd. (Maric), and the respondent architect, Lloyd Secter (Secter), each appealed the decision of the application judge granting leave to the applicant, pursuant to section 14(1) of The Limitations of Actions Act , CCSM c L150 (the Act ), to commence an action against each of them with respect to the design and construction of his house. [ 2 ] At the end of the appeal hearing, we dismissed the appeals with brief reasons to follow.

These are our reasons. [ 3 ] The applicant asserted that the respondents were liable in contract and negligence for damages caused by uncontrolled water that penetrated the fabric water barrier under the stucco of the house (the water-penetration problem).

He claimed that this resulted in rotting and deteriorated oriented strand board and framing, which he did not discover until June 2014. [ 4 ] After moving into the house in June 2008, the applicant encountered numerous problems with the house (the initial problems), including water entering the garage through the ceiling (in 2009) and faulty window frames (in 2009-2011).

[ 5 ] In 2009, the applicant obtained the expert advice of John Wells (Wells), an engineer with Crosier Kilgour & Partners Ltd. (Crosier), regarding the garage water problem. At that time, the applicant expressed concerns about the possibility of water entering in other areas and leading to damage. [ 6 ] In Crosier’s November 2009 report, Wells concluded that the cause of the water entering the garage through the ceiling was condensation due to air leakage between the house and the attached garage, not water infiltration.

He reached a similar conclusion with respect to the applicant’s concerns about the possibility of water penetration in the wall and/or roof system. [ 7 ] In 2011, blower door tests and thermographic survey testing of the house did not identify any other significant air- leakage problem. The applicant completed all of the work recommended by Wells to resolve these problems. [ 8 ] In 2012, the window manufacturer determined that the windows were defective and offered to replace them. The applicant declined the offer and chose to replace them with higher quality windows of a different design.

The applicant retained Crosier to oversee the window replacement project and P.C. Home Restoration Ltd. (PC) to install the new windows. [ 9 ] When stucco was removed during the window installation in June 2014, PC discovered the water-penetration problem around the windows. The applicant hired Crosier to advise how to address the water-penetration problem.

In his report dated March 26, 2015, Wells concluded, among other things, that the cause of the damage was clearly uncontrolled water penetration in behind the fabric water barrier and that its installation did not comply with applicable building codes. [ 10 ] The applicant filed the application on May 27, 2015. [ 11 ] The application judge found that the applicant only had knowledge of material facts of a decisive character about the water-penetration problem after PC discovered it in June 2014, which was within the 12 months prior to the filing of the notice of application (see section 14(1) of the Act ).

He rejected the respondents’ argument that the applicant ought to have known about the water-penetration problem because of his knowledge of the initial problems and the concerns that he expressed. He found that the initial problems were of a “wholly different nature” (at para 11) than the water-penetration problem, as was stated by Wells in his evidence.

He also found that the applicant “acted quite reasonably in methodically dealing with the various issues relating to his new home and cannot be faulted in not bringing an action relating to those issues” (at para 11). [ 12 ] A decision under section 14(1) of the Act is a discretionary decision.

Unless there is an error in law or a palpable and overriding error of fact, the decision is entitled to deference unless it is so clearly wrong as to amount to an injustice (see McIntyre v Frohlich et al , 2013 MBCA 20 ; and Morry et al v Janzen et al , 2015 MBCA 86 ). [ 13 ] The respondents’ positions on appeal were similar, but not identical. [ 14 ] In its factum, Maric asserted that the application judge: 1. made a palpable and overriding error in finding that it was only in June of 2014 that the applicant had knowledge of the material facts of a decisive nature; and 2. made a palpable and overriding error in finding that the nature of the damage behind the walls caused by water penetration was not a fact that the applicant ought to have known about more than 12 months before the application was filed. [ 15 ] At the appeal hearing, Maric’s submissions focussed on the issue of what the applicant ought to have known. [ 16 ] In his factum, Secter conceded that, when the limitation period expired, the applicant did not know of all of the material facts of a decisive nature upon which his proposed action is based.

He asserted that the application judge: 1. failed to consider all of the material facts which was a palpable and overriding error leading to a further error in his not finding that the applicant ought to have known all of the material facts of a decisive nature; and 2. misdirected himself as to the law by failing to conduct a meaningful analysis with respect to sections 20(2) , 20(3) and 20(4) of the Act . [ 17 ] Both respondents also asserted that the decision was so clearly wrong as to amount to an injustice. [ 18 ] The application judge explained the applicable test by quoting from Sochasky v Winnipeg (City) , 2013 MBQB 204 .

The quote from Sochasky reflects the requirements of the Act for the purpose of assessing when the applicant knew, or ought to have known, the material facts.

The application judge appropriately distinguished the circumstances here from those in Morry , which was relied on by the respondents. [ 19 ] The application judge found that: • although the applicant expressed concerns to Wells in 2009 about possible water penetration, the testing conducted on his house “did not bear that out” (at para 11); • the applicant “acted, in all the circumstances, with due diligence” (at para 12); • the water-penetration problem was an “unrelated and undiscoverable issue” (at para 12); • the delay in repairing the windows was “irrelevant, because at this point in time the applicant did not know, and could not know, about the damage . . . caused by water penetration” (at para 13); and • “the problems with the windows were also unrelated to the [water-penetration problem]: the windows were defective and the

manufacturer offered to replace them” (at para 13). [ 20 ] The application judge’s reasons demonstrate that he understood the evidence and the issues before him.

He addressed the respondents’ fundamental arguments before him that: (1) the applicant knew or ought to have known about the water-penetration problem long before the twelve-month period prior to when he filed the notice of application because of the initial problems; and (2) that he failed to act in a timely manner, particularly with respect to investigating his concerns. [ 21 ] The respondents did not persuade us that the application judge erred in law or made any palpable and overriding errors of fact. Furthermore, the decision is not unjust.

Therefore, the decision is entitled to deference. [ 22 ] For these reasons, the appeals were dismissed with costs in favour of the applicant on each appeal. JA JA JA