514953 B.C. Ltd. et al. v. Leung, 2007 BCCA 114

JudgeProwse, Hall and Levine, JJ.A.
CourtCourt of Appeal (British Columbia)
Case DateJanuary 16, 2007
JurisdictionBritish Columbia
Citations2007 BCCA 114;(2007), 236 B.C.A.C. 191 (CA)

514953 B.C. v. Leung (2007), 236 B.C.A.C. 191 (CA);

    390 W.A.C. 191

MLB headnote and full text

Temp. Cite: [2007] B.C.A.C. TBEd. FE.058

514953 B.C. Ltd. dba Gold Key Construction and Vincent Chiu (respondent/plaintiff) v. Yin Sing Leung (appellant/defendant)

(CA032585; 2007 BCCA 114)

Indexed As: 514953 B.C. Ltd. et al. v. Leung

British Columbia Court of Appeal

Prowse, Hall and Levine, JJ.A.

February 23, 2007.

Summary:

Leung contracted with Gold Key Construction to build a house for him. Leung refused to pay Gold Key's final invoice until deficiencies in the construction were remedied. Leung's expert estimated the cost of repairing the deficiencies at around $60,000. Gold Key sued Leung for the amount of the outstanding invoice, less $6,617 for the deficiencies which it acknowledged. Leung submitted that $60,000 should be set off against Gold Key's invoice due to the alleged deficiencies and that a further $3,000 should be set off as a penalty for the failure to complete the house in a timely way.

The British Columbia Supreme Court, in a decision reported at [2004] B.C.T.C. Uned. 737, awarded Gold Key judgment for $58,876.15, being the $67,493.15 balance owing on the contract, less a set-off of $8,617, which consisted of $2,000 as a penalty for failure to complete the work in the time specified and $6,617 to rectify the acknowledged deficiencies. The court considered that Leung had not led any evidence of diminution of the value of the house, and that the cost of remedying the unacknowledged deficiencies would clearly exceed any diminution of value, and it concluded that Leung had not proved any loss arising from the unacknowledged claims. Leung appealed, arguing that the court erred in finding that the measure of damages was the diminution of value of the home.

The British Columbia Court of Appeal dismissed the appeal. It was appropriate for the trial judge to adopt the diminution in value test. As no such diminution was proved, no award of damages could be made under that head.

Building Contracts - Topic 3442

Liability of builder - Defective workmanship or design - Damages - Leung contracted with Gold Key Construction to build a house for him - Leung refused to pay Gold Key's final invoice until deficiencies in the construction were remedied - Leung's expert estimated the cost of rectifying the deficiencies at around $60,000 - Gold Key sued Leung for the amount of its outstanding invoice, less $6,617 for the deficiencies which it acknowledged - Leung submitted that $60,000 should be set off against Gold Key's invoice due to the alleged deficiencies - The trial judge awarded Gold Key judgment for the balance owing on the contract, less a set-off of $8,617, which consisted of $2,000 as a penalty for delay in completing the work and $6,617 to rectify the acknowledged deficiencies - The trial judge considered that Leung had not led any evidence of diminution of value, and that the cost of remedying the unacknowledged deficiencies would clearly exceed any diminution of value, and he concluded that Leung had not proved any loss arising from the unacknowledged claims - The trial judge also considered that Leung had occupied the house for five years and had not remedied any of the alleged deficiencies and there was no evidence that he intended to do so - The British Columbia Court of Appeal held that it was appropriate for the trial judge to adopt the diminution in value test - As no such diminution was proved, no award could be made under that head.

Building Contracts - Topic 3568

Liability of builder - Damages - Measure of - Reinstatement costs of defective work - [See Building Contracts - Topic 3442 ].

Building Contracts - Topic 3581

Liability of builder - Damages - Measure of - Loss or diminution in value of owner's property - [See Building Contracts - Topic 3442 ].

Damages - Topic 201

Entitlement - Requirement of loss - [See Building Contracts - Topic 3442 ].

Damages - Topic 6512

Contracts - Building contracts - Breach by engineer or builder - Restoration costs - [See Building Contracts - Topic 3442 ].

Damages - Topic 6516

Contracts - Building contracts - Breach by engineer or builder - Measure of damages - [See Building Contracts - Topic 3442 ].

Cases Noticed:

Strachan v. Barton (1993), 10 C.L.R.(2d) 142 (B.C.S.C.), refd to. [para. 12].

Radford v. de Froberville, [1978] 1 All E.R. 33; [1977] 1 W.L.R. 1262, consd. [para. 13].

Ruxley Electronics and Construction Ltd. v. Forsyth, [1996] A.C. 344; 185 N.R. 241 (H.L.), consd. [para. 13].

Strata Corporation NW 1714 et al. v. Winkler (1987), 20 B.C.L.R.(2d) 16; 45 D.L.R.(4th) 741 (C.A.), refd to. [para. 20].

McGarry v. Richards, Ackroyd & Gall Ltd., [1954] 2 D.L.R. 367 (B.C.S.C.), refd to. [para. 20].

Housen v. Nikolaisen et al., [2002] 2 S.C.R. 235; 286 N.R. 1; 219 Sask.R. 1; 272 W.A.C. 1; 2002 SCC 33, refd to. [para. 23].

Counsel:

J.J. Kim, for the appellant;

R.M. Kyle and L. Nguyen, for the respondent.

This appeal was heard on January 16, 2007, at Vancouver, British Columbia, before Prowse, Hall and Levine, JJ.A., of the British Columbia Court of Appeal. The following judgment of the Court of Appeal was delivered by Hall, J.A., on February 23, 2007.

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27 practice notes
  • Compensation for Harm to Property Interests
    • Canada
    • Irwin Books Remedies: The Law of Damages. Third Edition Compensatory Damages
    • June 21, 2014
    ...Above note 151. 160 Baruch , above note 151; Nu-West Homes , above note 151. 161 See 514953 BC Ltd (cob Gold Key Construction) v Leung , 2007 BCCA 114; 0867740 BC Ltd v Quails View Farm Inc , 2013 BCSC 1021; Khaira v Nelson , 2002 BCSC 1045. Compensation for Harm to Property Interests 111 o......
  • Damages
    • Canada
    • Irwin Books The Law of Contracts. Third Edition Remedies
    • August 4, 2020
    ...appear to be true, however, only in cases where the courts are concerned that work will not be done. See also 514953 BC Ltd v Leung , 2007 BCCA 114 (more clearly limiting diminution in value to situations where the work is not likely to be done). 84 129 NE 889 (NY 1921) [ Jacob & Youngs ]. ......
  • Table of cases
    • Canada
    • Irwin Books Remedies: The Law of Damages. Third Edition Limiting Principles
    • June 21, 2014
    ...BC Ltd (cob Gold Key Construction) v Leung (2004), 39 CLR (3d) 303, [2004] BCJ No 2647, 2004 BCSC 1680, aff’d (2007), 64 BCLR (4th) 76, 2007 BCCA 114 .....................46–47, 103, 110 652013 BC Ltd v Kim, [2006] OTC 103, [2006] OJ No 423 (SCJ) ..................................................
  • Table of Cases
    • Canada
    • Irwin Books Archive Remedies: the Law of Damages. Second Edition Part Three
    • September 8, 2008
    ...v. Leung (2004), 39 C.L.R. (3d) 303, [2004] B.C.J. No. 2647, 2004 BCSC 1680, aff’d (2007), 64 B.C.L.R. (4th) 76, 155 A.C.W.S. (3d) 835, 2007 BCCA 114.............................................................................................. 91 652013 B.C. Ltd. v. Kim, [2006] O.T.C. 103, ......
  • Request a trial to view additional results
21 cases
  • Globalnet Management Solutions Inc. v. Cornerstone CBS Building Solutions Ltd., 2018 BCCA 303
    • Canada
    • Court of Appeal (British Columbia)
    • July 23, 2018
    ...awarded. (At para. 268.) [12] The trial judge cited this court’s decision in 514953 B.C. Ltd. dba Gold Key Construction and Chiu v. Leung 2007 BCCA 114, which in turn had quoted extensively from two English cases, Radford v. de Froberville [1978] 1 All E.R. 33 (Ch.D.) and Ruxley Electronics......
  • The Owners, Strata Plan K855 v. Big White Mountain Mart Ltd., 2017 BCCA 438
    • Canada
    • Court of Appeal (British Columbia)
    • December 19, 2017
    ...the cost of reinstatement will normally be the obvious measure of damages: 514953 B.C. Ltd. dba Gold Key Construction and Chiu v. Leung, 2007 BCCA 114 at para. 18. There is a duty to mitigate damages but that duty does not impose on the plaintiff an obligation to take any step which a reaso......
  • Cardwell v. Perthen, 2007 BCCA 313
    • Canada
    • British Columbia Court of Appeal (British Columbia)
    • March 29, 2007
    ...et al., [1995] 1 S.C.R. 85; 176 N.R. 321; 100 Man.R.(2d) 241; 91 W.A.C. 241, refd to. [para. 31]. 514953 B.C. Ltd. et al. v. Leung (2007), 236 B.C.A.C. 191; 390 W.A.C. 191; 2007 BCCA 114, refd to. [para. Larocque v. Lutz (1981), 29 B.C.L.R. 300 (C.A.), refd to. [para. 37]. Tony's Broadloom ......
  • Halle v. Ritchie, 2008 BCSC 1452
    • Canada
    • Supreme Court of British Columbia (Canada)
    • October 31, 2008
    ...it is excessive in relation to the diminution in value of the property in question. This was the situation in 514953 B.C. Ltd. v. Leung , 2007 BCCA 114, 64 B.C.L.R. (4th) 76, where the evidence did not establish a diminution in value and the owner had lived in the house for five years witho......
  • Request a trial to view additional results
6 books & journal articles
  • Table of Cases
    • Canada
    • Irwin Books Archive Remedies: the Law of Damages. Second Edition Part Three
    • September 8, 2008
    ...v. Leung (2004), 39 C.L.R. (3d) 303, [2004] B.C.J. No. 2647, 2004 BCSC 1680, aff’d (2007), 64 B.C.L.R. (4th) 76, 155 A.C.W.S. (3d) 835, 2007 BCCA 114.............................................................................................. 91 652013 B.C. Ltd. v. Kim, [2006] O.T.C. 103, ......
  • Compensation for Harm to Property Interests
    • Canada
    • Irwin Books Remedies: The Law of Damages. Third Edition Compensatory Damages
    • June 21, 2014
    ...Above note 151. 160 Baruch , above note 151; Nu-West Homes , above note 151. 161 See 514953 BC Ltd (cob Gold Key Construction) v Leung , 2007 BCCA 114; 0867740 BC Ltd v Quails View Farm Inc , 2013 BCSC 1021; Khaira v Nelson , 2002 BCSC 1045. Compensation for Harm to Property Interests 111 o......
  • Damages
    • Canada
    • Irwin Books The Law of Contracts. Third Edition Remedies
    • August 4, 2020
    ...appear to be true, however, only in cases where the courts are concerned that work will not be done. See also 514953 BC Ltd v Leung , 2007 BCCA 114 (more clearly limiting diminution in value to situations where the work is not likely to be done). 84 129 NE 889 (NY 1921) [ Jacob & Youngs ]. ......
  • Table of cases
    • Canada
    • Irwin Books Remedies: The Law of Damages. Third Edition Limiting Principles
    • June 21, 2014
    ...BC Ltd (cob Gold Key Construction) v Leung (2004), 39 CLR (3d) 303, [2004] BCJ No 2647, 2004 BCSC 1680, aff’d (2007), 64 BCLR (4th) 76, 2007 BCCA 114 .....................46–47, 103, 110 652013 BC Ltd v Kim, [2006] OTC 103, [2006] OJ No 423 (SCJ) ..................................................
  • Request a trial to view additional results

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