Leaky Condo Class Action Case Dismissed by the SCC

Having a carpenter for a partner adds an interesting twist to my life. Rather than playing Scrabble or sipping Margaritas on beaches, when he and I take a vacation, it is often to work on the current building project. It also means I take special interest in construction that leads to the courts like McMillan v. Canada Mortgage and Housing Corporation.

Eugene Meehan’s excellent publication Lang Michener Supreme Court of Canada L@wletter had this note today:

The Applicants purchased a condominium unit in a condominium development in White Rock, British Columbia, constructed in 1994. In 2000 it was determined that the building was suffering from premature building envelope deterioration. A contractor was hired to repair the structural damage and the Applicants were assessed a substantial sum to effect the repairs. The Applicants contended CMHC conducted extensive research into building science and wall assembly and construction in the early 1980s and 1990s. CMHC focussed its research on wall assembly construction and water ingress related envelope failures. The Applicants alleged CMHC’s negligence caused physical damage to their property. The claim rested on the proposition CMHC had a duty to warn the Applicants about problems with the envelope design being used, or to take reasonable steps to ensure that residential premises using that design were not built on the west coast of Canada, and failed to do so. The Applicants applied to certify the action as a class action. CMHC successfully brought a motion for summary judgment. An appeal was dismissed.
Alan McMillan, Linda Hepner v. Canada Mortgage and Housing Corporation (B.C.C.A. December 19, 2008) (33017) “The application for leave to appeal…is dismissed with costs.”

The BCCA and BCSC decisions concluded that there was an insufficient proximity between the homeowners and CMHC to create a duty to warn that would support certification of a class action.

Being unable to certify a class action in this case, and having it dismissed on cause of action grounds is probably extremely disappointing for the homeowners. It is also likely disheartening to all the folks at myleakycondo.com. There is a blog of cases on this type of construction problem, and though it hasn’t been updated in quite some time, it is still an interesting collection.

To read the summary, and see the path this took through the Supreme Court, have a look at the SCC Case Information site. The left menus show docket information, parties, counsel, summaries (written by the Office of the Registrar) and sometimes, though not in this case, Factums.

Although they were not successful, I envy the homeowners persistence. I also envy them the ability to point a finger. When I see a bump in my drywall, it is all my own fault!

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