Waterford House, West Vancouver: Defects in design and construction plague leaky luxury condos in Polygon highrise

 

                                                                                                          No. C865925

                                                                                                            Vancouver Registry

 

IN THE SUPREME COURT OF BRITISH COLUMBIA

 

BETWEEN:                                                        )

                                                                                    )

THE OWNERS, STRATA PLAN NO.        )

VR 1513, ELIZABETH McNEIGHT,           )

WILLIAM McINNES and MARY              )

LOCHHEAD McINNES, BASIL MARTIN )

PLUMB and ELINOR IRENE PLUMB       )

JAMES MORROW and ELIZABETH                    )                        REASONS FOR JUDGMENT

ROSALIE MORROW, NELSON COLVILLE          )

and EUNICE COLVILLE, FIORENZA       )

ALBERT-HOWARD, HERALD HINRICH )

HUGO STEENBOCK, MARIA ELENA       )

ARAGON, EARLE JAMES PAYNE                       )

and BARBARA STOREY PAYNE,                        )                        OF THE HONOURABLE

JONATHAN LIONEL LEWIS and                        )

MAGDALENA ELIZABETH LEWIS,         )

URSULA HEITMANN, ABEL SHENG       )

and SOPHIA SHENG, ALEXANDER        )

BRIAN BEATTY CARROTHERS,                         )

LORENA GEMA GALVEZ, SHERIL                      )                        MR. JUSTICE COULTAS

FREEDMAN, FARIDEH ROHANI              )

SIMON MOSCOVITCH, MICHAEL                       )

GRALLA and RUTH GRALLA,                )

MOHAMMED ROUSTA and SAIDEH      )

MERHI ROUSTA, BRIAN JAY                 )

ANDERSON, PEARL OWEN, MURRAY    )

PEZIM and ORVILLE ALEX SINGER       )

and PATRICIA AUDREY SINGER                        )

                                                                                    )

                                                PLAINTIFFS      )

                                                                                    )

AND:                                                                 )

                                                                                    )

ESTEEM INVESTMENTS LIMITED                      )

POLYGON PROPERTIES LIMITED,        )

THE CORPORATION OF THE                 )

DISTRICT OF WEST VANCOUVER,        )

ROMSES KWAN & ASSOCIATES,                      )

WERNER KARL PAULUS, MICHAEL       )

JAMES AUDAIN, JOHN KENNETH                      )

BULL, J. DONALD MAWHINNEY,                       )

JOHN G. R. THIRD and                                     )

JACQUELINE ASKEW                                        )

                                                                                    )

                                                DEFENDANTS    )


 

 

Counsel for the Plaintiffs:                     Irwin G. Nathanson, Esq.Esq.

                                                                                                Q.C.

 

Counsel for the Defendants:                

(Polygon Properties Limited

and others):                                                      Robert D. Holmes, Esq.

 

Counsel for the Defendant

and Third Party (Esteem

Investments Ltd.):                                             Thomas G. Lewis, Esq.

 

Place and Date of Hearing:                              Vancouver, B.C.

                                                                                                December 14, 1989

 

 

 

                 This matter came before the Court by way of Trial of An Issue. The trial date is imminent. I was told by counsel that a simple Finding would assist them in preparing for that trial.

 

                 The issue is this: Were Esteem Investments Limited and Polygon Properties Limited engaged in a joint venture in the development of a property known as "Waterford House"? I find that they were not.

 

                 Detailed Reasons to follow in due course.

 

 

 

 

 

Vancouver, British Columbia

17 January, 1990


                                                                                                                                  No. C865925

                                                                                                                      Vancouver Registry

 

 

                                    IN THE SUPREME COURT OF BRITISH COLUMBIA

 

 

BETWEEN:                                                                         )

                                                                                         )

THE OWNERS, STRATA PLAN NO.                         )

VR 1513, ELIZABETH McNEIGHT,               )

WILLIAM McINNES and MARY                               )

LOCHHEAD McINNES, BASIL MARTIN        )

PLUMB AND ELINOR IRENE PLUMB                       )

JAMES MORROW and ELIZABETH                         )

ROSALIE MORROW, NELSON COLVILLE )

and EUNICE COLVILLE, FIORENZA                        )

ALBERT-HOWARD, HERALD HINRICH                    )

HUGO STEENBOCK, MARIA ELENA                        )

ARAGON, EARLE JAMES PAYNE                )

JONATHAN LIONEL LEWIS and                 )

MAGDALENA ELIZABETH LEWIS,              )            SUPPLEMENTARY

URSULA HEITMANN, ABEL SHENG                        )

and SOPHIA SHENG, ALEXANDER                         )         REASONS FOR JUDGMENT

BRIAN BEATTY CARROTHERS,                              )

LORENA GEMA GALVEZ, SHERIL               )          OF THE HONOURABLE

FREEDMAN, FARIDEH ROHANI                               )

SIMON MOSCOVITCH, MICHAEL                )         MR. JUSTICE COULTAS

GRALLA and RUTH GRALLA,                                 )

MOHAMMED ROUSTA and SAIDEH                        )            (IN CHAMBERS)

MERHI ROUSTA, BRIAN JAY                                  )

ANDERSON, PEARL OWEN, MURRAY                    )

PEZIM and ORVILLE ALEX SINGER                       )

and PATRICIA AUDREY SINGER                )

                                                                                         )

                                                     PLAINTIFFS      )

                                                                                         )

AND:                                                                                  )

                                                                                         )

ESTEEM INVESTMENTS LIMITED               )

POLYGON PROPERTIES LIMITED,                         )

THE CORPORATION OF THE                                  )

DISTRICT OF WEST VANCOUVER,                         )

ROMSES KWAN & ASSOCIATES,               )

WERNER KARL PAULUS, MICHAEL                       )

JAMES AUDAIN, JOHN KENNETH               )

BULL, J. DONALD MAWHINNEY,                )

JOHN G.R. THIRD and                                            )

JACQUELINE ASKEW                                             )

                                                                                         )

                                                     DEFENDANTS    )

 

 

 


Counsel for the Plaintiff:                                                                 Irwin G. Nathanson, Esq. Q.C.

 

Counsel for the Defendants:

(Polygon Properties Limited

and others):                                                                                               Robert D. Holmes, Esq.

 

Counsel for the Defendant

and Third Party (Esteem

Investments Ltd.):                                                                                      Thomas G. Lewis, Esq.

 

 

 

 

Place and date of hearing:                                                                                  Vancouver, B.C.

                                                                                                                         December l4, l989

 

 

 

 

                             On January l7th, l990, I handed down Reasons in which I found that the Defendants Esteem Investments Limited and Polygon Properties Limited, were not engaged in a joint venture in the development of Waterford House, and undertook to give detailed Reasons subsequently. These are they.

 

                             This is the Trial of an Issue. The action involves a claim for damages brought by the owners of Strata Plan No. VR l5l3 alleging defects in design and construction in an l8 storey residential condominium project in West Vancouver known as "Waterford House". The issue before me is this - were the Defendants Esteem Investments Limited (Esteem) and Polygon Properties Limited (Polygon) parties to a joint venture in the development of that project?

 

                             Counsel have provided an Agreed Statement of Facts, and in it have given background information which follows.

 

                             Esteem and Polygon are separate companies, one from the other, not of common ownership or control and not affiliated with one another as defined in the Company Act R.S.B.C. l979, c.59, or at all. Esteem owned the land on which Waterford House was built and in l980, engaged architects to prepare plans and specifications for a development to be constructed on this land. Based on these plans Esteem obtained a development permit from the City of West Vancouver.

 

                             In September l983, in Hong Kong, Esteem and Polygon entered into negotiations concerning the sale of the land to Polygon and the development of it by that company. Those negotiations culminated in the sale of the land to Polygon for $2,400,000.00. The sale included a building permit, which Esteem had obtained from the Municipality, together with the plans and specifications prepared by Esteem's architect.

 

                             In December l983, Polygon entered into a loan arrangement with Citibank Canada for $8,750,000.00 to finance the construction of Waterford House.

 

                             When the sale was completed, Polygon became the sole owner of the land in fee simple. Ultimately, $2,400,000.00 was paid by Citibank Canada on behalf of Polygon to the solicitors for Esteem.

 

                             Construction on the land commenced in l984 and continued through l985. All design costs respecting changes to the architectural plans, all construction costs and insurance costs incurred during construction were paid for by Polygon alone. Polygon arranged for the supply of construction material and the hiring of sub-trades for construction and did not account to Esteem for any of these costs.

 

                             On May 3lst, l985, Strata Plan VR l5l3 was deposited and registered with the Land Title Office and individual titles to each lot were issued to Polygon. The Strata Corporation was formed as of that date.

 

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