BC Supreme Court dismisses proposed leaky condo class action lawsuit by McMillan and Hepner against CMHC

IN THE SUPREME COURT OF BRITISH COLUMBIA

Citation:

McMillan v. Canada Mortgage and Housing Corporation,

 

2007 BCSC 1475

Date: 20071001
Docket: S056412
Registry: Vancouver

Between:

Alan McMillan and Linda Hepner

Plaintiffs

And

Canada Mortgage and Housing Corporation

Defendant


Before: The Honourable Madam Justice Lynn Smith

Reasons for Judgment

Counsel for Plaintiffs

J.R. Singleton, Q.C.
W. Sun

 

Counsel for Defendant

D.R. Clark, Q.C.
R.D. Garrett

 

Date and Place of Hearing:

May 14, 15 and 16, 2007

 

Vancouver, B.C.

TABLE OF CONTENTS

PARA. NO.

I.          INTRODUCTION                                                                                           1

II.         THE PLAINTIFFS’ APPLICATION                                                               4

III.        DO THE PLAINTIFFS HAVE A CAUSE OF ACTION
            AGAINST THE DEFENDANT IN NEGLIGENCE?
                                      11

A.         STANDARD TO BE MET                                                                  11

B.         NATURE OF THE CLAIM                                                                 15

C.        APPLICABLE LEGAL PRINCIPLES                                                 16

            1. Basic propositions of negligence law                                             16

            2. Negligence claims against statutory bodies                                   20

D.        THE STATUTORY FRAMEWORK                                                   26

E.         THE SUBMISSIONS OF THE PARTIES                                          29

            1. Submissions for the Plaintiffs                                                         29

            2. Submissions for the Defendant                                                      33

F.         ANALYSIS                                                                                          37

            1. The first stage of the Cooper/Anns test                                        37

(a) Physical harm to property                                                 38

(b) Negligent Misrepresentation                                             43

(c) Duty to Warn                                                                     43

(d) Conclusion on Categories                                                 46

            2. The second stage of the Cooper/Anns test                                  47

IV.        CONCLUSION                                                                                               47

APPENDIX “A”                                                                                                          48

I. INTRODUCTION

[1]                Mr. McMillan and Ms. Hepner, the plaintiffs, own a condominium residence in the Villa Positano complex in White Rock, British Columbia.  They purchased it from a developer on October 12, 1996.  In the spring of 2000 it became known that there could be a problem with water leaks and moisture related damage to the complex.  The Strata Council retained building envelope engineers who provided a report concluding that the Villa Positano was suffering premature building envelope deterioration.

[2]                In 2003 a contractor made repairs and implemented modifications recommended by the engineers.  The plaintiffs were assessed a total of $61,795.10 to cover their share of the cost of the repairs.

[3]                The plaintiffs have commenced an action to recover damages from the defendant Canada Mortgage and Housing Corporation (“CMHC”).  They apply to have their action certified as a class action pursuant to the Class Proceedings Act, R.S.B.C. 1996, c. 50.  The defendant disputes their application for certification and also applies for summary judgment under Rule 18A of the Rules of Court, B.C. Reg. 221/90, seeking an order declaring that the defendant owes no duty of care to the plaintiffs and dismissing the plaintiffs’ action with costs.

[4]                The phenomenon of “leaky condos” (of which the plaintiffs say the Villa Positano is an example) has resulted in considerable hardship for many home owners in British Columbia, as documented in the Report of the Commission of Inquiry into the Quality of Condominium Construction in British Columbia by Dave Barrett, Commissioner (Victoria: Minister of Municipal Affairs, June 1998).

[5]                Counsel for the plaintiffs summarizes their position in his written submission as follows:

The Plaintiffs’ claim is that in the course of its investigating housing problems in Canada, CMHC learned of a fundamental flaw in the design and construction of residential dwellings on the West Coast of Canada which CMHC knew, if uncorrected, would lead to wide spread structural failure in these homes.   The Plaintiffs say that with this knowledge CMHC owed to them a private law duty of care to warn the proposed class of these known defects, or to have taken the appropriate steps to arrest further construction of these homes on the west coast of British Columbia.  Not having done so, CMHC was in breach of the duty they owed to the class and have thereby been a major contributor to the leaky condominium debacle on the west coast of British Columbia, which has lead to wide spread structural failure of thousands of homes, hundreds of millions of dollars of damages, and the disenfranchisement of thousands of homeowners.  The situation created cries out for an affordable remedy against CMHC.

II. THE PLAINTIFFS’ APPLICATION

[6]                Mr. McMillan and Ms. Hepner assert in their pleadings that CMHC, as a result of investigations it had undertaken, knew that the design of buildings such as the Villa Positano (combining a sealed exterior face of the walls with an energy efficient interior design) would result in the trapping of moisture inside the building, the build-up of mold and fungi, and structural deterioration.  They say that CMHC was under a duty to them and to other owners and prospective purchasers of residential accommodation incorporating that design to pass on the knowledge CMHC had acquired and to take reasonable steps to ensure that design was not used in the construction of west coast residences.  They claim that CMHC was in breach of its duty and of its statutory obligations and that the plaintiffs suffered damage as a result of CMHC’s negligence. 

[7]                The pleadings in the Amended Statement of Claim include the following allegations:

7.         The exterior walls of The Villa Positano were originally designed and constructed to utilize what is commonly known as a “face-seal” assembly, which includes a sealed exterior face of the walls designed to prevent water from entering the wall (“Face Seal Design”), and an energy efficient interior design, being a sealed interior wall designed to prevent heat and vapour transmission from the interior of the building through the walls (“Energy Efficient Design”) the combination of the Face Seal Design and the Energy Efficient Design hereinafter called (the “Envelope Design”).

8.         The Envelope Design was, to the knowledge of CMHC, in wide use on the west coast of Canada and elsewhere in Canada from at least 1981 to the present time.

9.         In or around 2000, The Villa Positano began to exhibit signs of wetting, deterioration, mold and other damage which resulted from water, vapour and moisture ingress into the building envelope, brought about the following combination of events:

(a)        Wind-driven rain penetrated the exterior face of the building envelope through the stucco facing and some imperfections in construction details at wall penetrations, joints and intersections;

(b)        The Envelope Design did not provide a mechanism for water, vapour or moisture which migrated past the exterior or interior cladding into the building envelope to migrate out of the wall assembly, either through the exterior face or the inside face of the building envelope;

(c)        Heat and vapour was transmitted from the inside of the building into the building envelope and resulted in condensation in and around the components of the building envelope; and

(d)        Moisture trapped within the building envelope resulted in the build up of mold and fungi, leading to structural deterioration of the components of the wall assembly.

(collectively described as “Envelope Failure”).

10.       As a result of Envelope Failure, extensive repairs were required to The Villa Positano, as a result of which the Plaintiffs have suffered loss, expense and damage, and other compensable losses and consequences, particulars of which include:

(a)        Their proportionate share of the overall cost to investigate Envelope Failure and repair the damage to The Villa Positano;

(b)        Damage to personal property within their unit;

(c)        The cost of temporary accommodation; and

(d)        Stress and inconvenience related to the investigation and repair of the damage caused by Envelope Failure.

(collectively, the “Damage”).

11.       The business and powers of CMHC are described in section 17 of the CMHC Act as follows:

“17. Subject to section 33 of this Act and to section 100 of the National Housing Act, the Corporation shall, on behalf of Her Majesty and in the place of the Minister, have, exercise and perform all rights, powers, duties, liabilities and functions of the Minister under the Housing Acts or under any contract entered into under those Acts, except the authority of the Minister under those Acts to pay money out of the Consolidated Revenue Fund.”

12.       The powers, duties and functions of CMHC are further set out in the National Housing Act, R.S.C. 1985 c. N-11 (the “Housing Act”), as follows:

“73. It is the responsibility of [CMHC] to cause investigations to be made into housing conditions and the adequacy of existing accommodation in Canada or in any part of Canada and to cause steps to be taken for the distribution of information leading to the construction or provision of more adequate and improved accommodation and the understanding and adoption of community plans in Canada.

74. For the purpose of carrying out its responsibility under this Part, the Corporation may cause

(a) investigations to be made into housing conditions and the adequacy of existing housing accommodation in Canada or in any part of Canada and into measures that may be taken for the improvement thereof;

…”

13.       During the period between in or around 1981 and in or around 1994, CMHC undertook extensive investigation of wall assembly construction and water ingress related envelope failures on both the east coast and west coast of Canada in buildings incorporating the Envelope Design. In the course of those investigations, CMHC gained the following knowledge:

(a)        There was widespread utilization of the Envelope Design in the construction of residential occupancies on the west coast of Canada between 1981 and 1994;

(b)        Residential occupancies constructed using the Envelope Design, such as that used in The Villa Positano, was more likely than not to suffer from deterioration of the building envelope because of Envelope Failure;

(c)        The only way Envelope Failure might be avoided in buildings which utilize the Envelope Design, would be if the exterior face of the building envelope was built to a standard of perfection, and that the prospect of that occurring was remote;

(d)        There was the prospect, if not likelihood, that Envelope Failure might occur by reason of the Energy Efficient Design alone, which promoted the buildup of warm, moist air on the interior of the building which would then migrate and reside in the interior of the building envelope;

(e)        Even if the exterior face of the building envelope which utilized the Envelope Design were to be built to a standard of perfection, the in-service weather conditions and climate of the west coast of Canada would eventually lead to Envelope Failure;

(f)         Residential occupancies constructed on the west coast of Canada and elsewhere in Canada incorporating the Envelope Design were experiencing deterioration of the building envelope because of Envelope Failure; and

(g)        Without the building industry and prospective buyers of homes incorporating the Envelope Design being warned of the prospect of Envelope Failure and the knowledge CMHC had gained, it was likely that such building envelope failures would continue to mount at significant cost to homeowners on the west coast of Canada.

(“CMHC’s Knowledge”)

14.       By reason of its statutory obligations and the knowledge it obtained through its involvement in research into the prospective problems of the Envelope Design, CMHC owed a common law duty to the Plaintiffs, other owners and prospective purchasers of residential accommodation incorporating the Envelope Design to pass on to them most or all of CMHC’s Knowledge and to take reasonable steps to ensure that residential occupancies incorporating the Envelope Design were not built on the west coast of Canada.

15.       Notwithstanding CMHC’s Knowledge, CMHC failed to take the appropriate steps to ensure that its knowledge was passed on to the housing industry or to homeowners or to prospective purchasers of homes and was thereby in breach of its statutory obligations and the common law duty it owed to owners of multi-family dwellings, including the Plaintiffs, and to prospective owners, of homes incorporating the Envelope Design.

16.       As a result of the negligence of CMHC, the Plaintiffs have suffered the Damage.

17.       CMHC’s conduct amounted to a wanton and reckless disregard for the lives and safety of occupants and prospective occupants, including the Plaintiffs, of residential occupancies constructed on the west coast of Canada incorporating the Envelope Design.

18.       The Plaintiffs waive any and all right to recover from CMHC, in this Action, any portion of their loss or damage for which CMHC might reasonably be entitled to claim contribution, indemnity or apportionment, either at common law or pursuant to the Negligence Act, R.S.B.C. 1996. c. 333.

THE CLASS

19.       The Plaintiffs bring this action on behalf of all those persons who purchased a residential occupancy, or unit or interest in a residential occupancy located on the west coast of Canada, which was built between January 1, 1982 and December 1, 2005, which incorporated the Envelope Design and which exhibits or has exhibited signs of Envelope Failure.

20.       The Plaintiffs plead and rely on the provisions of the CMHC Act, the Housing Act, the Class Proceedings Act R.S.B.C. 1996, c. 50 and the Negligence Act, R.S.B.C., 1996, c. 333.

[8]                The relief the plaintiffs seek against CMHC is:

(a)        Judgment with respect to the common issue of liability with damages to be assessed as between individual condominium owners and CMHC pursuant to section 27 of the Class Proceedings Act;

(b)        Directions pursuant to section 27 of the Class Proceedings Act for the assessment of individual damage claims;

(c)        Damages for the Plaintiffs against CMHC, including punitive, exemplary and aggravated damages;

(d)        In the event that this action is not certified as a class action, costs on a solicitor and own client basis; and

(e)        Such further and other relief as is necessary.

[9]                The plaintiffs seek to be appointed as representative plaintiffs and to bring this action on behalf of a class of persons which is described in the proposed “class definition” attached to these Reasons as Appendix “A”.

[10]            The requirements to be met by the plaintiffs in their application for an order certifying this as a class proceeding are set out in s. 4 of the Class Proceedings Act:

Class certification

4 (1)     The court must certify a proceeding as a class proceeding on an application under section 2 or 3 if all of the following requirements are met:

(a)        the pleadings disclose a cause of action;

(b)        there is an identifiable class of 2 or more persons;

(c)        the claims of the class members raise common issues, whether or not those common issues predominate over issues affecting only individual members;

(d)        a class proceeding would be the preferable procedure for the fair and efficient resolution of the common issues;

(e)        there is a representative plaintiff who

(i)         would fairly and adequately represent the interests of the class,

(ii)        has produced a plan for the proceeding that sets out a workable method of advancing the proceeding on behalf of the class and of notifying class members of the proceeding, and

(iii)       does not have, on the common issues, an interest that is in conflict with the interests of other class members.

(2)        In determining whether a class proceeding would be the preferable procedure for the fair and efficient resolution of the common issues, the court must consider all relevant matters including the following:

(a)        whether questions of fact or law common to the members of the class predominate over any questions affecting only individual members;

(b)        whether a significant number of the members of the class have a valid interest in individually controlling the prosecution of separate actions;

(c)        whether the class proceeding would involve claims that are or have been the subject of any other proceedings;

(d)        whether other means of resolving the claims are less practical or less efficient;

(e)        whether the administration of the class proceeding would create greater difficulties than those likely to be experienced if relief were sought by other means.

[11]            The first requirement listed, that the pleadings disclose a cause of action, was predominant in the arguments made before me in three days of hearing.  Mr. Singleton accurately describes it as the “eye of the storm” in this case.  I will therefore address that major issue first.

[...] 

[104]        The defendant CMHC did not manufacture any item used in construction, nor did it have a statutory responsibility to authorize the use of materials, to prescribe construction methods, or to play any direct role in the construction of housing in British Columbia.

[105]        I find that this case does not fall within the category of cases in which a duty to warn has been found, nor is this case analogous to cases under that category.

(d) Conclusion on Categories

[106]        I conclude that the claim by the plaintiffs does not fall into any category of cases where a duty of care has previously been recognized, nor is it analogous to any of those categories.

[107]        Therefore, I must consider whether this is a situation in which a new duty of care should be recognized.

[108]        If there are any factors giving rise to proximity, they must arise from the statutes which create the CMHC and provide its mandate.

[109]        The statutes under which the defendant exists and operates give it no regulatory responsibility with respect to the construction of housing in British Columbia.  There is nothing in either the CMHC Act or the Housing Act which creates a duty of care on the CMHC to individual homeowners.  The legislation is comparable to that in Kimpton, where no duty of care was found.

[110]        The relationship between the defendant and the plaintiffs is far from the close and direct relationship envisioned in Donoghue v. Stevenson.  There is insufficient proximity between the parties to create a duty on the part of the defendant.

[111]        I find it plain and obvious that on the facts pleaded there is no proximity between the plaintiffs and the defendant sufficient to give rise to a prima facie duty of care under the first stage of the Cooper/Anns test.

2. The second stage of the Cooper/Anns test

[112]        If I am wrong that it is plain and obvious that on the facts pleaded there is no proximity, I would find under the second stage of the Cooper/Anns test that there are residual policy considerations (as described in Cooper at para. 37) outside the relationship of the parties that negative the imposition of a duty.  Those residual policy considerations include the likelihood that imposing on CMHC a private law duty of care to individual homeowners would interfere with CMHC’s ability to carry out its responsibility to investigate and publish its findings, and the possibility of indeterminate liability.

IV. CONCLUSION

[113]        I have concluded that the plaintiffs’ application to certify this action as a class proceeding under the Class Proceeding Act must be dismissed because the pleadings fail to disclose a cause of action.

[114]        It is therefore unnecessary to address the other issues regarding certification.

[115]        The defendant applied for summary judgment dismissing the plaintiffs’ action under Rule 18A.  For the reasons I have given with respect to the plaintiffs’ application, the defendant’s application for summary judgment is allowed because the pleadings fail to disclose a cause of action.

“The Honourable Madam Justice Lynn Smith”

APPENDIX “A”

CLASS DEFINITION

The definition of the Class in these proceedings is proposed as follows:

“AII persons who purchased a residential occupancy, unit or interest in a multiple- family, building located on the West Coast of Canada (more particularly described by the municipalities and regional districts listed in Appendix A) which was built between January 1, 1982 and the date of the Certification Order, and which utilized a Face-Sealed or Concealed-Barrier wall assembly, incorporating Stucco Cladding, a Wood Frame and Air Barrier (“the Envelope Design”). and which persons were required to pay or have been assessed to pay for all or a portion of the costs associated with repairing any such wall assembly as a result of water or moisture ingress into the wall assembly.

“Face-Sealed” refers to a design strategy for rain penetration control that relies on the exterior layer (the wall cladding) of the building envelope assembly to resist all rain penetration.

“Concealed-Barrier” refers to a design strategy for rain penetration control here a sheathing membrane located to the interior of the exterior surface of the wall cladding provides a barrier to resist the penetration of rain water further into the assembly.

“Stucco Cladding” refers to a layer or layers of stucco and related materials or components of a building envelope assembly that constitute the outermost surface of the wall assembly such that it is fully exposed to the exterior environment.

“Wood Frame” refers to a wall, the structural components of which are comprised mainly of wood.

“Air Barrier” refers to one or more layers of materials and components that together control the flow of air across layers of a wall assembly for the purpose of limiting the potential for heat loss / gain, and interstitial water vapour transfer and condensation, due to air movement.

 

READ THE ENTIRE REASONS FOR JUDGMENT AT

2007 BCSC 1475 McMillan v. Canada Mortgage and Housing Corporation

Judge reserves decision regarding certification of latest proposed leaky condo class action lawsuit


From The Richmond Review:



Judge reserves decision on leaky condo class-action
Leaky condo owners will have to wait as long as two months before the B.C. Supreme Court rules on whether to certify as a class action a lawsuit stemming from the billion-dollar construction crisis. details

Court of Appeal dismisses proposed leaky condo class action case; lawmaking beyond review by court

Court of Appeal for British Columbia

Citation:

Kimpton v. Canada (A.G.) and British Columbia (HMTQ)

 

2004 BCCA 72

Date: 20040203


Docket: CA30432

Between:

Mary Louise Kimpton

Appellant

(Plaintiff)

And

Attorney General of Canada and Her Majesty the Queen in Right of the Province of British Columbia

Respondents

(Defendants)

 


 

Before:

The Honourable Madam Justice Huddart

The Honourable Mr. Justice Mackenzie

The Honourable Madam Justice Thackray

Oral Reasons for Judgment

P.G. Guy

Counsel for the Appellant

A.D. Louie and D.B. Prosser

 

 

T.H. MacLachlan, Q.C.

and C. Owen

Counsel for the Federal Crown Respondent

 

Counsel for the Provincial Crown Respondent

 

Place and Date:

Victoria, British Columbia

February 3, 2004

 


[1]            HUDDART J.A.: This appeal from the dismissal of an application for certification as a class proceeding asks whether British Columbia or Canada owes a private law duty of care to owners of residential strata units in a condominium complex constructed in 1990 in Saanich, known as "The Willows".  The building in which the applicant’s unit is situated suffered building envelope failure, allegedly because it was constructed in compliance with the National Building Code requirement that the exterior walls be sealed by two vapour proof barriers.  The alleged effect of this requirement on buildings in coastal British Columbia was to trap moisture between the barriers with consequential structural damage and health hazard.

[2]            The applicant alleges the National Research Council (NRC) was negligent and failed in its duty to warn when it drafted and published, as the agent of Canada, the National Building Code of Canada (NBC) containing that requirement, and that British Columbia was negligent in its implementation of the Legislature’s policy decision to enact by regulation a building code with the effect of a municipal bylaw.

[3]            The applicant’s building was required to be constructed in compliance with the British Columbia Building Code, 1987 (BCBC 1987).  That code was established by regulation made under the authority of s. 692(1) of the Local Government Act, R.S.B.C. 1996, c.323.  It adopted by reference the NBC, as it existed on December 30, 1985, with changes the designated minister considered necessary.  The BCBC, 1987 applied throughout British Columbia and had the same force and effect as a validly enacted municipal bylaw until it was replaced with a revised code in 1992.

[4]            The chambers judge, for reasons reported at (2002), 9 B.C.L.R. (4th) 139, 2002 BCSC 1645, found it was plain and obvious the action could not succeed against either Canada or British Columbia because the pleadings did not establish a private law duty of care on either government, nor could they be amended to do so.  Applying the test developed in Anns v. Merton London Borough Council, [1978] A.C. 728 as applied in Cooper v. Hobart, [2001] 3 S.C.R. 537, he concluded the applicant could not demonstrate sufficient proximity to establish a prima facie duty of care on either British Columbia or Canada.  He noted that neither claim fell within a category of cases where a private law duty of care had been recognized, and concluded in both cases that policy considerations negated the recognition of a new duty of care, even were a prima facie duty of care to be established.

[5]            The appellant submits the approach of the chambers judge to the determination of the certification issue was “essentially sound,” but that he erred in result.  In her factum these issues were identified:

1. Did the trial judge err in dismissing the plaintiff’s application for certification in finding that there were considerations that ought to or did negative or reduce or limit the scope of the duty that British Columbia owed to the proposed class, or the damages to which a breach of it may give rise?

2. Did the trial judge err in holding that there was a valid policy consideration that ought to negative the duty of care that British Columbia owed the proposed class because the BCBC was a policy decision and not its operative implementation and that any negligence in creating the BCBC is not actionable?

3. Did the trial judge err in holding that there was a valid policy consideration that ought to negative the duty of care that British Columbia owed the proposed class because the spectre of indeterminate liability negates the prima facie duty of care owed by British Columbia to the proposed class?

4. Did the trial judge err in holding that there was a valid policy consideration that ought to negative the duty of care that British Columbia owed the proposed class because the fact that the Local Government Act does not set any limit on the type and amount of claims that might be advanced against British Columbia negates the prima facie duty of care owed by British Columbia to the proposed class?

5. Did the trial judge err in holding that there was no relationship of sufficient proximity between Canada and the Plaintiff or members of the proposed class so as to create a duty of care?

6. Did the trial judge err in holding that there was a valid policy consideration that ought to negative the duty of care that Canada might owe the plaintiff and the proposed class because the spectre of indeterminate liability negates any prima facie duty of care?

[6]            As I view the case against British Columbia, there is only one issue.  In my view the chambers judge correctly found the creation and establishment of the BCBC to be an act of lawmaking.  See Welbridge Holdings Ltd. v. Metropolitan Corporation of Greater Winnipeg, [1971] S.C.R. 957.  Immunity from the application of tort law flows from that fact.  As the chambers judge noted at paragraph 63 of his reasons for judgment, “[t]o the extent a government negligently governs, the voting public may impose a political consequence at an election.”  It follows I would not accede to the grounds of appeal that apply to British Columbia.

[7]            Nor would I accede to the grounds of appeal with regard to the claim against Canada.  I am not persuaded the chambers judge erred when he held that the National Research Council was not in a relationship of sufficient proximity with the appellant to give rise to a private law duty of care.  The appellant presented no authority establishing a duty of care on any advisor to a legislative body.  And that is the role of the National Research Council with regard to the NBC.  The National Research Council is a creature of statute.  Parliament created it to have “charge of such matters affecting scientific and industrial research as the Governor in Council may assign to it” National Research Council Act, R.S., c. N-14, s. 4.  Included in such matters was the development of a model building code to assist municipalities in enacting building bylaws and the construction industry by having uniform national building standards.

[8]            To the extent the appellant and others in her very unhappy situation may have been injured by the alleged negligence in the preparation or dissemination of the NBC, their reliance can only be on British Columbia, whose Legislature authorized the making of the regulation adopting the NBC by reference, with the effect of a municipal building bylaw, an act of lawmaking, as I have said, beyond review by a court in the conduct of tort law.

[9]            I would dismiss the appeal.

[10]        MACKENZIE J.A.: I agree.

[11]        THACKRAY J.A.: I agree.

[12]        HUDDART J.A.: The appeal is dismissed.

“The Honourable Madam Justice Huddart“

 

Class Action: Owners claim developer understated common expenses

Thestar.com
A group of unhappy condominium owners has commenced a class action against the developer of their Thornhill condominium project, claiming that the common expenses shown in the sales materials were significantly understated. Between 1999 and 2002, Cantertrot Investments (an H&R project) was marketing condominium units in The Residence of Beauclaire, on New Westminster Dr., in Thornhill. Before entering into the agreements, purchasers received a flyer indicating that maintenance fees for the units were "estimated at $0.32 per square foot," including utilities, visitor parking, concierge and one locker. Before signing agreements, the purchasers also received a disclosure statement as required under the Condominium Act. The statement indicated that $413,000 were the "total funds required" to be contributed by all owners in the form of common expenses during the first year following registration of the condominium. Based on the proposed budget and the draft condominium declaration, monthly common expenses for units in the project would range from $171.42 to $421.65, depending on unit size. The condominium declaration was registered on June 28, 2002 and, by law, the developer was responsible for any shortfall between the proposed budget and the actual budget for the first year of operation. A year later, the new board of directors reviewed the finances of the building and had no choice but to approve a budget showing increases of more than 62 per cent in common expenses for the second year of operation. Even after the increase, the new budget implemented a deficit of $48,000, which was funded by a special assessment of about $15 per unit each month for four years. In 2004, a group of the original purchasers retained Samuel Marr and Vadim Kats, of the Toronto law firm, Landy Marr LLP (http://www.landymarr.com), to launch an intended class action against the developer, its principals and the real estate brokers involved in marketing the condominium units. In order to start a class action in Ontario, a judge must be satisfied that certain tests are met and the legal proceedings would be more efficient if handled under one umbrella rather than having dozens of individual plaintiffs each commence their own lawsuits. After months of legal manoeuvring by both sides, Superior Court Justice Maurice C. Cullity recently certified the action as a class proceeding, allowing it to proceed with two plaintiffs — Solly Lewis and Hersl Kalif — representing themselves and those with similar interests. Irvin Schein and Stephen C. Nadler, of Toronto's Minden Gross, are representing the developer, and have applied for permission to appeal Cullity's certification order. The allegations in the claim of the plaintiffs are that, as a result of the alleged understatement of common expenses, the original buyers from Cantertrot suffered increased maintenance fees after the condominium's first year, loss of the services that had to be cut back to keep the budget in line, and diminished property values. The plaintiffs' case against the developer and its principals is based on alleged negligence, misrepresentation, breach of the Condominium Act, oppression and other legal grounds. They claim that the marketing materials and disclosure statements were "inaccurate, false, deceptive and misleading." In their claim, the plaintiffs allege that before the purchasers closed their transactions, and before the registration of the declaration, the developer was warned in writing by the property manger "that unless drastic adjustments are made, the second-year budget will likely be doubled." The defendants, of course, dispute the allegations. The trial of the case — if it gets that far — is a long way off, and none of the plaintiffs' claims have yet been proven in court. Materials filed in court last year on one of several appearances before Cullity show that 120 plaintiff unit owners are claiming damages of $10,572 to $12,643 for smaller units, and $26,004 to $31,101 for larger units. The damages are based on two expert reports, and have yet to be tested at trial. The total loss claimed by the class members is in a range of $2.1 million to $2.5 million. Experts retained by the defendants, on the other hand, have estimated that the total losses of the buyers would be between zero and $52,300. Obviously one class action, where the issues and facts are all similar, is preferable to the enormous costs of 120 separate Superior Court actions, where some of the damages might fall within the $10,000 Small Claims Court jurisdiction. Unless the matter is settled earlier, a trial of the action could well be two or more years into the future. For condominium builders and owners, it will be a fascinating case to watch as it unfolds. Bob Aaron is a Toronto real estate lawyer. He can be reached by email at bob@aaron.ca, phone 416-364-9366 or fax 416-364-3818. Visit the column archives at http://www.aaron.ca.

Court denies certification of proposed leaky condo class action; no cause of action

Citation:

Kimpton v. Canada (Attorney General) et al

Date:

20021128

 

2002 BCSC 1645

Docket:

01/1447

Registry:  Victoria

IN THE SUPREME COURT OF BRITISH COLUMBIA

BETWEEN:

MARY LOUISE KIMPTON

PLAINTIFF

AND:

 

ATTORNEY GENERAL OF CANADA,

CANADA MORTGAGE AND HOUSING CORPORATION AND

HER MAJESTY THE QUEEN IN RIGHT OF THE

PROVINCE OF BRITISH COLUMBIA

 

DEFENDANTS

 

 

REASONS FOR JUDGMENT

 

OF THE

 

HONOURABLE MR. JUSTICE MACAULAY

 

 

Counsel for the Plaintiff:

P. Guy

Counsel for the Defendant:

  Attorney General of Canada

A.D. Louie and

D.P. Prosser

 

Counsel for the Defendant:

  Her Majesty the Queen in Right of the Province of British Columbia

 

T.H. MacLachlan, Q.C. and

C. Owen

Counsel for the Defendant:

  Canada Mortgage and Housing Corporation

 

J. Sullivan

Date and Place of Hearing:

September 3-6, 2002 and

September 9-13, 2002

 

Victoria, BC

 

[1]            The plaintiff, Ms. Kimpton, owns a residential strata unit in a condominium complex known as the Willows, constructed in Saanich in 1990.  She seeks an order certifying this action as a class proceeding pursuant to sections 2 and 4 of the Class Proceedings Act, R.S.B.C. 1996, c. 50 (the "Act").

[2]            In the action, Ms. Kimpton seeks to raise the question of whether the defendants, the Attorney General of Canada ("Canada") and Her Majesty the Queen in right of the Province of British Columbia (the "Province") were negligent in drafting the National Building Code (the "NBC") and the British Columbia Building Code (the "BCBC”), respectively (collectively, the “codes").  As to the remaining defendant, the Canada Mortgage and Housing Corporation ("CMHC"), Ms. Kimpton raises the question of whether CMHC, by granting mortgage insurance for construction and conventional loans in Canada, made misrepresentations as to the suitability of the NBC.

[3]            I will set out the particular causes of action alleged by Ms. Kimpton when I address what I consider to be a fundamental flaw in her application, namely the failure to plead underlying causes of action as required by s. 4(1)(a) of the Act.  In short, I have concluded that it is plain and obvious that all the causes of action, or claims, as set out in the pleadings, are bound to fail.  It is not the novelty of the claims that prevents them from proceeding; it is because it is plain and obvious that they cannot succeed.  I reach this conclusion in spite of the plaintiff’s attempts to shoehorn them into ordinarily recognizable categories of claim such as negligence, negligent misrepresentation and failure to warn.

[4]            My reasons for denying certification follow.

SECTION 4(1)(A) OF THE ACT

[5]            Section 4 of the Act requires the Court to certify a proceeding as a class proceeding where all of the requirements of the section are met.  Section 4(1)(a) requires that the pleadings disclose a cause of action.

[6]            The threshold is low.  Ms. Kimpton is not required to pass a preliminary merits test.  While some cases have suggested that the plaintiff bears a burden to show a cause of action, that is potentially misleading, as burdens are generally evidentiary in nature.  I prefer to say that the plaintiff must demonstrate on the pleadings, or the pleadings as they might reasonably be amended, that there is a cause of action.  I should only refuse to certify where Ms. Kimpton plainly and obviously cannot succeed.

[7]            I agree with counsel for Ms. Kimpton that the correct approach to the issue is set out in a number of cases, including Hollick v. Toronto (City), [2001] S.C.J. No. 67 (Q.L.) (S.C.C.) at para. 16.  In Endean v. Canadian Red Cross Society (1998), 48 B.C.L.R. (3d) 90 at 92-93, Braidwood J.A. said:

Any challenge by a defendant that a plaintiff has not presented a cause of action as required by s. 4(1)(a) of the Class Proceedings Act is, in essence, an application under R. 19(24) of the British Columbia Rules of Court that the pleading discloses no reasonable cause of action.

 

The test for determining such an issue in this Court is clearly expressed in the case of Hunt v. T & N plc, [1990] 2 S.C.R. 959, 49 B.C.L.R. (2d) 273 (S.C.C.), at 980 [S.C.R.], where Wilson J., writing for the Court, set out the test as follows:

 

            Thus, the test in Canada governing the application of provisions like R. 19(24)(a) of the British Columbia Rules of Court is the same as in one that governs an application under R.S.C.O. 18, r. 19:  assuming that the facts as stated in the Statement of Claim can be proved, is it "plain and obvious” that the plaintiff’s statement of claim discloses no reasonable cause of action?  As in England, if there is a chance that the plaintiff might succeed, then the plaintiff should not be “driven from the judgement seat".  Neither the length and complexity of the issues, the novelty of the cause of the action, nor the potential for the defendant to present a strong defence, should prevent the plaintiff from proceeding with his or her case.  Only if the action is certain to fail because it contains a radical defect ranking with the others listed in Rule 19(24) of the British Columbia Rules of Court, should the relevant provisions of the Plaintiff’s Statement of Claim be struck out under Rule 19(24)(a).

 

      The question to be decided, then, is whether it is "plain and obvious" that the plaintiff’s statement of claim discloses no reasonable cause of action.  Is there some radical defect which would amount to an abuse of process of the court such that the claim should be struck?  The fact that the point is a novel one would not prevent the issue proceeding to trial.

 

At this stage, I have followed the same practice as I did in Collette v. Great Pacific Management Co., [2001] B.C.J. No. 253 (Q.L.)(S.C.) at paras. 52, 57 and 59, of reading the statement of claim as generously as possible with a view to accommodating any inadequacies due solely to drafting deficiencies.

[8]            The Province argued, in part, that the test under s. 4(1)(a) is not predicated on the assumption that the pleadings may be amended.  I disagree.  I am not aware of any authority to support a more restrictive approach than traditionally taken when analysing pleadings under Rule 19(24).

[9]            While the threshold is low, it does not follow that it is sufficient for the plaintiff to merely label her claim as one in negligence.  While not in the context of a class proceeding, the comments of Taylor J.A. in Kripps v. Touche Ross & Co. (1992), 69 B.C.L.R. (2d) 62 (C.A.) at para. 86, regarding the Court's role in a Rule 19(24) application, are instructive:

A court may be tempted, at the present point in the development of the Canadian law of negligence, to permit every negligence claim to proceed to trial.  But that would lead to a long and costly period of uncertainty, one particularly costly in the commercial world where certainty in the law is of considerable importance.  It seems to me that the courts would fail in their duty to community were they to decline to exercise jurisdiction under R. 19(24) simply because of the current state of the jurisprudence in this area of the law.  It is, I think, important in some cases that the court make a decision at this stage concerning the extent to which recovery in negligence can be enlarged, and I believe this to be such a case.

 

Those principles are equally applicable to the s. 4(1)(a) analysis.

[10]        As pointed out by the Province, and as set out below, there is a growing body of judicial authority for refusing to certify proceedings as class proceedings on the basis that the plaintiff has failed to demonstrate that a cause of action is set out in the pleadings before the Court:

Cooper v. Hobart, [2001] S.C.J. No. 76 (Q.L.);

Halvorson v. British Columbia (Medical Services Commission) (2001), 88 B.C.L.R. (3d) 319 (S.C.);

Price v. British Columbia, [2001] B.C.J. No. 2284 (Q.L.) (S.C.); and

F.G.M. Holdings Ltd. v. British Columbia (Workers’ Compensation Board) (2000), 79 B.C.L.R. (3d) 271 (S.C.).

THE PLEADINGS

[11]        In this section of my reasons, I set out the relevant paragraphs in the statement of claim as they relate to the causes of action against each defendant:

Against The Province:

9.    At material times the Province, through the Ministry of Municipal Affairs, Building Standards Branch, exercised its statutory discretion pursuant to the Municipal Act and established a Provincial Building Code for British Columbia ("the BC Building Code").  The Province did so by adopting the NBC with the amendments that the Province considered necessary.

 

10.   The Province holds itself out as having the necessary skill, qualification and competence to create the BC Building Code to establish minimum standards for the construction of buildings suitable for the different climactic areas and conditions in British Columbia and that would ensure that buildings constructed in accordance with those provisions would have and maintain structural sufficiency, quality, durability, and safety with respect to the health of occupants for the reasonable lifetime of the building.

 

11.   In and after 1985, the Province established BC Building Codes to set minimum provisions respecting standards for the construction of buildings suitable for the different climactic areas and conditions in British Columbia, and to ensure that buildings constructed in accordance with those provisions would have and maintain structural sufficiency, quality, durability and safety with respect to the health of occupants for the reasonable lifetime of the building.

 

12.   The Municipal Act, R.S. [sic] 1979, c. 290, as amended from time to time, provided that the BC Building Code applied to all Municipalities in British Columbia and had the same force and effect as a validly enacted bylaw of a Municipality.  Municipalities in British Columbia were required to, and did, enforce the minimum provisions contained in the B.C. Building Code.

 

...

 

31.   The Province was in a relationship of sufficient proximity to the Plaintiff Class that it owed them a statutory duty and a duty to take care to ensure that the BC Building Code was suitable for use in all climactic areas of British Columbia, and to warn if it was not.

 

32.   The Province also owed the Plaintiff Class a duty to warn if changes in the BC Building Code necessitated changes in common construction practices and that Buildings built in accordance with the BC Building Code would not have structural sufficiency, quality and durability for a reasonable lifetime and/or safety with respect to the health of occupants if practices used in construction of Buildings were not changed.

 

33.   The Province owed the Plaintiff Class the statutory duty, and a duty of care to ensure that the minimum requirements of the NBC would be such that all Buildings constructed in accordance with the BC Building Code would have and maintain structural sufficiency, quality and durability for a reasonable lifetime, and that they would also have and maintain safety with respect to the health of occupants, and to warn if they would not.

 

34.   The Province represented to the Plaintiff Class that a Building constructed in accordance with the BC Building Code would have and maintain structural sufficiency, quality and durability for [sic] reasonable lifetime, and that the Building would have and maintain safety with respect to the health of occupants.

 

35.   The Province owed the Plaintiff Class a duty to take care in the making of the said representations.

 

36.   The Province knew or ought to have known that the Plaintiff Class would rely and did rely on its representations and would thereby be induced to purchase Buildings.

 

37.   Acting on the faith of the said representations of the Province and induced thereby, members of the Plaintiff Class purchased Buildings.

 

38.   In breach of its duty, the Province was guilty of negligence in making the said representations, and failing to warn, thereby causing the Plaintiff Class loss and damage.

 

39.   In breach of all of its said duties, the Province was guilty of negligence in establishing the BC Building Code and implementing it in British Columbia.  It was unsuitable for use in British Columbia and did not anticipate or provide a remedy for the likely entrapment or condensation of water in exterior walls and/or the problems that result.

 

40.   In further breach of its duties, the Province failed to warn that changes to the BC Building Code, in or after 1985, required changes in construction practices and failed to warn that Buildings constructed in accordance with the BC Building Code thereafter would not maintain structural sufficiency, quality, durability or safety with respect to the health of occupants for the reasonable lifetime of the Building.

 

41.   Buildings were not suitable for use in British Columbia.  They developed problems resulting from the entrapment or condensation of water vapour in exterior walls and did not maintain structural sufficiency, quality, durability, or safety with respect to the health of occupants for a reasonable time.

 

42.   The said problems that developed in exterior walls have required changes in construction practices and both the problems and required changes were reasonably foreseeable as the result of amendments to the BC Building Code in or after 1985 and maintained thereafter.

 

43.   Particulars of the negligence of the Province include:

 

      a)    failing to ensure that after 1985, the BC Building Code was suitable for use throughout British Columbia, and failing to warn that it was not and/or that it required changes in construction practices, and

 

      b)    failing to ensure that all Buildings would maintain structural sufficiency, quality, durability and safety with respect to the health of occupants for a reasonable time, and

 

      c)    failing to ensure that changes to the NBC relating to reduction of vapour diffusion and increased airtightness of Buildings would not, when adopted in British Columbia, lead to a decrease in or failure of structural sufficiency, quality or durability in Buildings, and/or the loss of safety in respect to the health of occupants, and

 

      d)    failing to acknowledge or investigate experience in other jurisdictions, scientific knowledge, opinions and advice of members of the Building Standards Branch and/or others that warned against the adoption in British Columbia of the provisions of the NBC that related to reduction of vapour diffusion, and increased insulation and airtightness of Buildings, and

 

      e)    failing to amend the NBC as adopted in British Columbia so that the provisions therein that related to reduction of vapour diffusion and increased insulation and airtightness of Buildings would not cause a decrease in or failure of structural sufficiency, quality and durability in Buildings, and/or the loss of safety in respect to the health of occupants, and

 

      f)    failing to ensure that the BC Building Code adequately dealt with problems that would result from condensation or entrapment of water vapour in exterior walls, and

 

      g)    failure to warn that Buildings would suffer premature depreciation, obsolescence and failure, and

 

      h)    failure to warn that after the said amendments to the BC Building Code, Buildings would henceforth be intolerant of moisture within exterior walls, while previously exterior walls had been tolerant of such moisture, and

 

      i)    failure to consider the effect on a Building if water or moisture did leak into or condense in exterior walls that were required by the BC Building Code to be airtight, and to provide a remedy for that potential problem as part of the minimum standards of the BC Building Code, and

 

      j)    failure to warn that common construction practices had to change.

 

Against Canada:

6.    Through the National Research Council ("NRC"), Her Majesty the Queen in Right of Canada is responsible for the creation of the National Building Code for Canada ("NBC").  The NBC is a set of minimum provisions respecting the safety, quality and durability of buildings to protect public health and maintain structural sufficiency.  Her Majesty the Queen in Right of Canada intended that the NBC be adopted as a building code by all jurisdictional authorities in Canada, without amendment.

 

7.    The NRC holds itself out as having the necessary skill, qualification and competence to fulfill its responsibility to create the NBC so that it would be suitable for adoption as a building code by any authority in Canada.

 

8.    Pursuant to its said responsibility, the NRC created, copyrighted and published the NBC from time to time.

 

...

 

13.   Her Majesty the Queen in Right of Canada was in a relationship of sufficient proximity to the Plaintiff Class that it owed them a duty of care to ensure that all of the provisions of the NBC, if adopted, were suitable for use in British Columbia, and/or to warn if they were not.

 

14.   Her Majesty the Queen in Right of Canada also owed the Plaintiff Class a duty to warn if changes in the NBC necessitated changes in common construction practices, and/or if buildings built in accordance with the NBC would not have structural sufficiency, quality and durability for a reasonable lifetime, and/or if those Buildings would not have safety with respect to the health of occupants if the practices used in construction of Buildings were not changed.

 

15.   Her Majesty the Queen in Right of Canada owned the Plaintiff Class a duty of care to ensure that the minimum requirements of the NBC would be such that all Buildings constructed in accordance with the NBC in British Columbia would have and maintain structural sufficiency, quality and durability for a reasonable lifetime, and that such Buildings would have and maintain safety with respect to the health of occupants, and to warn if they would not.

 

16.   By creating the NBC and holding it out as suitable for use in all parts of Canada, Her Majesty the Queen in Right of Canada represented to the Plaintiff Class that a Building would have and maintain structural sufficiency, quality and durability for a reasonable lifetime, and that it would also have and maintain safety with respect to the health of occupants.

 

17.   Her Majesty the Queen in Right of Canada owed the Plaintiff Class a duty to take care in the making of its said representations.

 

18.   Her Majesty the Queen in Right of Canada knew or ought to have known that the Plaintiff Class would rely on its said representation and would thereby be induced to purchase Buildings.

 

19.   Acting on the faith of the said representations of Her Majesty the Queen in Right of Canada, and induced thereby, members of the Plaintiff Class purchased Buildings that were constructed, and that were required to be constructed, in accordance with the NBC.

 

20.   In breach of its said duties, Her Majesty the Queen in Right of Canada was guilty of negligence in making its said representations and in failing to warn, thereby causing the Plaintiffs loss and damage.

 

21.   Further and in the alternative, in breach of all of its duties, Her Majesty the Queen in Right of Canada was guilty of negligence in writing, publishing and holding the NBC out as suitable for adoption in all parts of Canada.  The NBC did not anticipate or provide a remedy for the likely entrapment or condensation of water in exterior walls constructed in accordance with the NBC and/or the resulting problems.

 

22.   In further breach of its duties, Her Majesty the Queen in Right of Canada failed to warn that changes to the NBC in about 1985 required changes in construction practices and failed to warn that buildings built in accordance with the NBC thereafter would not maintain structural sufficiency, quality or durability, or safety with respect to the health of occupants for a reasonable lifetime of the Building.

 

23.   Buildings were not suitable for use in British Columbia.  They developed problems resulting from the entrapment or condensation of water in exterior walls and did not maintain structural sufficiency, quality, durability, or safety with respect to the health of occupants for a reasonable time, thereby causing the Plaintiff Class loss and damage.

 

24.   The said problems that developed in exterior walls have required changes in construction practices and both those problems and the required changes were reasonably foreseeable as the result of amendments to the NBC made in or about 1985, and maintained thereafter.

 

25.   Particulars of the negligence of Her Majesty the Queen in Right of Canada include:

 

      a)    failing to ensure that after 1985, the NBC was suitable for adoption in all parts of British Columbia, and failing to warn that it was not, and/or that the NBC required changes in construction practices, and

 

      b)    failing to ensure that Buildings would maintain structural sufficiency, quality, durability and safety with respect to the health of occupants for a reasonable lifetime, and

 

      c)    failing to ensure that changes to the NBC relating to reduction of vapour diffusion and increased airtightness of Buildings would not, if adopted in British Columbia, lead to a decrease in, or failure of, structural sufficiency, quality and durability in Buildings, and/or the failure of safety in respect to the health of occupants, and

 

      d)    failing to obtain or investigate or adequately investigate experience in other jurisdictions, scientific knowledge, opinions or advice of members of the NRC and/or Building Standards Branch, and/or others, that warned against the adoption in British Columbia of the NBC that related to reduction of vapour diffusion and increased insulation and airtightness of Buildings, and

 

      e)    failing to recommend that the NBC as adopted in British Columbia should be amended so that the provisions therein that related to reduction of vapour diffusion and increased insulation and airtightness of Buildings would not cause a decrease in or failure of structural sufficiency, quality or durability of Buildings and/or the failure of safety in respect to the health of occupants, and

 

      f)    failing to ensure that the NBC adequately dealt with problems that would result from condensation or entrapment of water in exterior walls of Buildings, and

 

      g)    failure to warn that Buildings built in accordance with the NBC would suffer premature depreciation, obsolescence and failure, and

 

      h)    failure to warn that after the said amendments to the NBC, Buildings would henceforth be intolerant of moisture within exterior walls, while exterior walls previously had been tolerant of such moisture, and

 

      i)    failure to consider the effect on a Building if water or moisture did leak into or condense in exterior walls that the NBC required to be airtight, and to provide a remedy for that problem as part of the minimum standards of the NBC, and

 

      j)    failure to warn that common construction practices had to change.

 

Against CMHC:

26.   For a fee, CMHC acts as an insurer of construction and conventional mortgage loans made in Canada.

 

27.   CMHC requires that any new property against which a mortgage insured by CMHC is to be registered must be built in accordance with the NBC.  At times material to this action CMHC approved plans for Buildings prior to construction commencing.

 

28.   By its requirements and by implication CMHC represented that a Building would have and maintain structural sufficiency, quality and durability for a reasonable lifetime and/or the term of the insured mortgage, and that it would also have and maintain safety with respect to the health of occupants.

 

29.   CMHC was in a position of sufficient proximity to members of the Plaintiff Class that it owed them a duty to take care in making the said representation.

 

30.   CMHC was negligent in making the said representation in that Buildings for which CMHC granted mortgage insurance did not maintain structural sufficiency, quality or durability for a reasonable lifetime or the term of the insured mortgage, nor did those Buildings maintain safety with respect to the health of occupants, thereby causing the Plaintiffs loss and damage.

 

In paragraph 44 of the statement of claim, it is alleged as against all defendants:

44.   By reason of the said breaches of duties of care and statutory duties and by reason of the said negligent misrepresentations members of the Plaintiff Class have suffered loss and damage, including:

 

      a)    the cost of repairs to their Building, and

 

      b)    the cost of alternative accommodation, and

 

      c)    diminution in the value of their Building, and

 

      d)    loss of use and enjoyment of their Building, and

 

      e)    further and other loss and damage as shall be advised.

 

DUTY OF CARE

[12]        Ms. Kimpton contends that her pleadings disclose causes of action in negligence, breach of duty to warn and negligent misrepresentation.  In law, each of those causes of action requires proof that the particular defendant owed a duty of care to the plaintiff that was breached.  Accordingly, the underlying issue in each instance is whether the particular defendant owed a duty of care to Ms. Kimpton.  If no duty was owed, the particular claim is bound to fail.

[13]        Ms. Kimpton also suggests, albeit not forcibly, that whether a duty of care exists is, itself, a triable issue that might be certified as a common issue in a class proceeding.  A similar approach was urged on the court at the certification hearing in Campbell v. Flexwatt Corp. (1996), 25 B.C.L.R. (3d) 329 (S.C.), a case decided very early in the history of class proceedings in this province.  That approach, however, does not sufficiently take into account the passage from Kripps set out above.

[14]        Kripps makes it clear that a court is not bound to refuse relief under Rule 19(24) simply because the relevant area of the common law is uncertain.  As set out at para. 9 of the decision:

It would be wrong that those against whom action is brought in an area of law which happens to be in an active state of development should for that reason alone be required to bear the cost of inquiry into the facts before the court will decide whether the claim is one which calls for an answer.

 

I turn now to the analytical framework for determining whether a duty of care exists.

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