Arora et al. v. Whirlpool Canada LP et al., 2013 ONCA 657

• Judge: Hoy, A.C.J.O., Feldman and Simmons, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: July 02, 2013
• Jurisdiction: Ontario
• Citations: 2013 ONCA 657;(2013), 311 O.A.C. 203 (CA)

Arora v. Whirlpool Can. LP (2013), 311 O.A.C. 203 (CA)

MLB headnote and full text

Temp. Cite: [2013] O.A.C. TBEd. NO.003

Vijay Arora, Stacey Jacobs and Kathleen Oliver (plaintiffs/appellants) v. Whirlpool Canada LP and Whirlpool Corporation (defendants/respondents)

(C56224; C56006; 2013 ONCA 657)

Indexed As: Arora et al. v. Whirlpool Canada LP et al.

Ontario Court of Appeal

Hoy, A.C.J.O., Feldman and Simmons, JJ.A.

October 31, 2013.

Summary:

The plaintiffs sought to certify a class action against Whirlpool Canada LP and Whirlpool Corp. ("Whirlpool"), alleging that their front-loading washing machines were poorly designed and prone to developing an unpleasant smell. The plaintiffs claimed damages for breach of express and implied warranty, breach of the Competition Act (Can.), negligence, and waiver of tort.

The Ontario Superior Court, in a decision reported [2012] O.T.C. Uned. 4642, dismissed the certification motion and the action, concluding that none of the claims disclosed a cause of action. The plaintiffs appealed.

The Ontario Court of Appeal dismissed the appeal.

Contracts - Topic 2107

Terms - Express terms - Warranty clauses - The plaintiffs sought to certify a class action against Whirlpool, alleging that its front-loading washing machines were poorly designed and prone to developing an unpleasant smell - The plaintiffs claimed damages for, inter alia, breach of express warranty - A motions judge dismissed the certification motion and the action, because the claim had no reasonable prospect of success - The plaintiffs appealed, arguing that it was not plain and obvious that their claims were not covered by the express warranties and that a full trial was needed to interpret the warranties - The Ontario Court of Appeal dismissed the appeal - The motions judge's decision was correct - See paragraphs 17 to 24.

Contracts - Topic 9001

Rights and liabilities of strangers to contract - Privity of contract - Exceptions - The plaintiffs sought to certify a class action against Whirlpool (manufacturer), alleging that its front-loading washing machines were not fit for purpose (Sale of Goods Act (SGA), s. 15) - A motions judge refused to certify and dismissed the action, because in Ontario, the remedy under the SGA was against the seller and in this case Whirlpool was not the seller as its washers were sold through retailers (i.e., there was no privity of contract) - The plaintiffs appealed - The Ontario Court of Appeal dismissed the appeal holding that the motions judge was correct - The court noted, however, that the situation was different in Saskatchewan and New Brunswick where legislation provided that a lack of privity did not defeat a third party's claim for damages from breach of an implied warranty - See paragraphs 25 to 42.

Damages - Topic 531

Limits of compensatory damages - Remoteness - Torts - Recoverable damages - Purely economic loss - [See Torts - Topic 4332 ].

Practice - Topic 209.3

Persons who can sue and be sued - Individuals and corporations - Status or standing - Class or representative actions - Certification - Considerations (incl. when class action appropriate) - The plaintiffs sought to certify a class action against Whirlpool, alleging that its front-loading washing machines were poorly designed and prone to developing an unpleasant smell - The plaintiffs claimed damages for breach of express and implied warranty, breach of the Competition Act (Can.), negligence, and waiver of tort - A motions judge dismissed the certification motion and the action, concluding that none of the claims disclosed a cause of action - The plaintiffs appealed - The Ontario Court of Appeal dismissed the appeals - The motions judge was correct.

Restitution - Topic 128

Unjust enrichment - Remedies - Waiver of tort - The Ontario Court of Appeal referred to a summary of the state of the law on waiver of tort: "... 'Historically, the doctrine of waiver of tort provided the victim of certain types of tortious wrongdoing with the option of foregoing (waiving) tort compensation measured by the damages suffered by the victim and claim instead disgorgement of the tortfeasor's ill-gotten gains. The traditional view was that waiver of tort was a remedy available for certain torts ... there has been a debate about the doctrinal nature of waiver of tort and the range of its availability. There, however, has been one point beyond debating. Whether a remedy or a cause of action, for waiver of tort to be available, the defendant must have done something wrong ..." - See paragraph 117.

Restitution - Topic 128

Unjust enrichment - Remedies - Waiver of tort - The plaintiffs sought to certify a class action against Whirlpool (manufacturer), alleging that its front-loading washing machines were prone to developing an unpleasant smell - The plaintiffs claimed damages for waiver of tort - The motions judge refused to certify and dismissed the action, holding that the plaintiffs' pleadings failed to disclose a cause of an action because there was no predicate wrongdoing upon which to base a waiver of tort plea, regardless of whether waiver of tort was considered a remedy or an independent cause of action - The plaintiffs appealed - The Ontario Court of Appeal dismissed the appeal, agreeing with the motions judge - See paragraphs 117 to 121.

Sale of Goods - Topic 4106

Conditions and warranties - Implied or statutory terms as to quality or fitness - Fitness or suitability of goods - The plaintiffs sought to certify a class action against Whirlpool (manufacturer), alleging that its front-loading washing machines were not fit for purpose (Sale of Goods Act (SGA), s. 15) - A motions judge refused to certify and dismissed the action, holding that in Ontario, the remedy under the SGA was against the seller and in this case retailers sold Whirlpool's washers (i.e., there was no privity of contract) - The plaintiffs appealed - The Ontario Court of Appeal dismissed the appeal - The motions judge was correct in holding that in Ontario, the plaintiffs could not claim directly against the manufacturer - Further, this case did not fall within the exception regarding privity in Fraser River v. Can-Dive (SCC 1999) - See paragraphs 25 to 42.

Sale of Goods - Topic 4106

Conditions and warranties - Implied or statutory terms as to quality or fitness - Fitness or suitability of goods - [See Contracts - Topic 9001 ].

Torts - Topic 4332

Suppliers of goods - Negligence - Manufacturers - Defective design or manufacture - The plaintiffs sought to certify a class action against Whirlpool (manufacturer), claiming damages for pure economic loss (diminution in value) because Whirlpool's front loading washing machines were negligently designed (prone to developing an unpleasant smell) - The washers were not claimed to be dangerous - A motions judge refused to certify and dismissed the action - The plaintiffs appealed - The Ontario Court of Appeal dismissed the appeal - Assuming, as the motions judge did, that there was a prima facie duty of care established, the court held that policy considerations negated recognizing a cause of action in negligence for diminution in value for a defective, non-dangerous, consumer product - The plaintiffs should be left to their statutory and contractual remedies, including express, implied or statutory warranties - See paragraphs 52 to 116.

Torts - Topic 4339

Suppliers of goods - Product liability - Negligence - Manufacturers - Damages - General - [See Torts - Topic 4332 ].

Trade Regulation - Topic 645

Competition - Advertising - False or misleading advertising - The plaintiffs sought to certify a class action against Whirlpool, alleging a breach of s. 52 of Competition Act (representation by omission because the plaintiffs were not told that the washers were susceptible to developing unpleasant odours) - A motions judge dismissed the certification motion and the action - The plaintiffs appealed - The Ontario Court of Appeal dismissed the appeal - The court agreed that where, as here, there was no common express representation pleaded which could convert an omission into a misrepresentation by implication, and there was no duty to disclose, it was plain and obvious that a claim for breach of s. 52 could not succeed - The failure to disclose the alleged defect was not a "representation" for purposes of s. 52 - See paragraphs 43 to 51.

Cases Noticed:

Taylor v. Canada (Attorney General) (2012), 293 O.A.C. 312; 111 O.R.(3d) 161; 2012 ONCA 479, refd to. [para. 14].

Hunt v. T & N plc et al., [1990] 2 S.C.R. 959; 117 N.R. 321, refd to. [para. 14].

Hunt v. Carey Canada Inc. - see Hunt v. T & N plc et al.

British Columbia v. Imperial Tobacco Canada Ltd. et al., [2011] 3 S.C.R. 45; 419 N.R. 1; 308 B.C.A.C. 1; 521 W.A.C. 1; 2011 SCC 42, refd to. [para. 14].

Wellington et al. v. Ontario et al. (2011), 277 O.A.C. 318; 105 O.R.(3d) 81; 2011 ONCA 274, leave to appeal refused (2011), 428 N.R. 394; 291 O.A.C. 399 (S.C.C.), refd to. [para. 14].

Canadian National Railway Co. et al. v. Royal & Sun Alliance Insurance Co. of Canada et al., [2008] 3 S.C.R. 453; 381 N.R. 332; 243 O.A.C. 340; 2008 SCC 66, refd to. [para. 24].

Maher v. Great Atlantic & Pacific Co. of Canada Ltd. et al. (2010), 266 O.A.C. 173; 2010 ONCA 415, refd to. [para. 24].

Mann-Tattersall v. Hamilton (City) et al., [2000] O.T.C. Uned. E59; 38 C.L.R.(3d) 255 (Sup. Ct.), refd to. [para. 28].

Caputo et al. v. Imperial Tobacco Ltd. et al., [2004] O.T.C. 112; 236 D.L.R.(4th) 348 (Sup. Ct.), refd to. [para. 29].

Dunlop Pneumatic Tyre Co. v. Selfridge & Co., [1915] A.C. 847 (H.L.), refd to. [para. 29].

Fraser River Pile & Dredge Ltd. v. Can-Dive Services Ltd., [1999] 3 S.C.R. 108; 245 N.R. 88; 127 B.C.A.C. 287; 207 W.A.C. 287, not appld. [para. 30].

London Drugs Ltd. v. Brassart and Vanwinkel, [1992] 3 S.C.R. 299; 143 N.R. 1; 18 B.C.A.C. 1; 31 W.A.C. 1, refd to. [para. 39].

London Drugs v. Kuehne & Nagle International Ltd. et al. - see London Drugs Ltd. v. Brassart and Vanwinkel.

Brown v. Belleville (City) (2013), 302 O.A.C. 354; 114 O.R.(3d) 561; 2013 ONCA 148, refd to. [para. 39].

Vandewal v. Vandewal, [2002] O.J. No. 393 (Sup. Ct.), affd. 2003 CanLII 1002 (C.A.), refd to. [para. 41].

Kitimat (District) v. Alcan Inc. (2006), 223 B.C.A.C. 27; 369 W.A.C. 27; 265 D.L.R.(4th) 462; 2006 BCCA 75, refd to. [para. 41].

Holmes et al. v. United Furniture Warehouse Limited Partnership et al. (2012), 322 B.C.A.C. 156; 549 W.A.C. 156; 2012 BCCA 227, refd to. [para. 41].

Williams et al. v. Canon Canada Inc. et al., [2011] O.T.C. Uned. 6571; 2011 ONSC 6571, affd. in part (2012), 294 O.A.C. 251; 34 C.P.C.(7th) 403; 2012 ONSC 3692 (Div. Ct.), refd to. [para. 47].

Spinks v. Canada, [1996] 2 F.C. 563; 195 N.R. 184 (F.C.A.), refd to. [para. 48].

Knight v. Imperial Tobacco Canada Ltd. et al., [2005] B.C.T.C. 172; 250 D.L.R.(4th) 347; 2005 BCSC 172, revd. in part (2006), 225 B.C.A.C. 291; 371 W.A.C. 291; 267 D.L.R.(4th) 579; 2006 BCCA 235, refd to. [para. 48].

Martel Building Ltd. v. Canada, [2000] 2 S.C.R. 860; 262 N.R. 285; 2000 SCC 60, refd to. [para. 53].

Anns v. Merton London Borough Council, [1978] A.C. 728 (H.L.), refd to. [para. 54].

Hughes v. Sunbeam Corp. (Canada) Ltd. et al. (2002), 165 O.A.C. 68; 61 O.R.(3d) 433 (C.A.), leave to appeal refused (2003), 320 N.R. 193; 189 O.A.C. 200 (S.C.C.), refd to. [para. 54].

Hill et al. v. Hamilton-Wentworth Regional Police Services Board et al., [2007] 3 S.C.R. 129; 368 N.R. 1; 230 O.A.C. 260; 2007 SCC 41, refd to. [para. 54].

Canadian National Railway Co. et al. v. Norsk Pacific Steamship Co. and Tug Jervis Crown et al., [1992] 1 S.C.R. 1021; 137 N.R. 241, refd to. [para. 55].

Winnipeg Condominium Corp. No. 36 v. Bird Construction Co. 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. 55].

Johnston v. NEI International Combustion Ltd., [2008] 1 A.C. 281; 375 N.R. 248; [2007] UKHL 39, refd to. [para. 77].

Rothwell v. Chemical and Insulating Co. - see Johnston v. NEI International Combustion Ltd.

Mustapha v. Culligan of Canada Ltd., [2008] 2 S.C.R. 114; 375 N.R. 81; 238 O.A.C. 130; 2008 SCC 27, refd to. [para. 78].

Sable Offshore Energy Inc. et al. v. Ameron International Corp. et al. (2007), 255 N.S.R.(2d) 164; 814 A.P.R. 164; 2007 NSCA 70, leave to appeal refused (2008), 384 N.R. 390; 273 N.S.R.(2d) 400; 872 A.P.R. 400 (S.C.C.), refd to. [para. 83].

Mariani v. Lemstra et al. (2004), 246 D.L.R.(4th) 489 (Ont. C.A.), leave to appeal refused (2005), 336 N.R. 199; 204 O.A.C. 396 (S.C.C.), refd to. [para. 84].

Ducharme v. Solarium de Paris Inc., [2008] O.J. No. 1558 (Div. Ct.), refd to. [para. 85].

Haskett v. Trans Union of Canada Inc. et al. (2003), 169 O.A.C. 201; 63 O.R.(3d) 577 (C.A.), refd to. [para. 88].

Haskett v. Equifax Canada Inc. et al. - see Haskett v. Trans Union of Canada Inc. et al.

Andersen Estate et al. v. St. Jude Medical Inc. et al., [2012] O.T.C. Uned. 3660; 2012 ONSC 3660, refd to. [para. 90].

Zidaric v. Toshiba of Canada Ltd., [2000] O.T.C. Uned. E51; 5 C.C.L.T.(3d) 61 (Sup. Ct.), refd to. [para. 92].

Hasegawa (M.) & Co. v. Pepsi Bottling Group (Canada) Co. (2002), 169 B.C.A.C. 261; 276 W.A.C. 261; 213 D.L.R.(4th) 663 (C.A.), refd to. [para. 92].

B.D. et al. v. Children's Aid Society of Halton Region et al., [2007] 3 S.C.R. 83; 365 N.R. 302; 227 O.A.C. 161; 2007 SCC 38, refd to. [para. 94].

Syl Apps Secure Treatment Centre v. B.D. - see B.D. et al. v. Children's Aid Society of Halton Region et al.

Naken et al. v. General Motors of Canada Ltd. (1978), 21 O.R.(2d) 780 (C.A.), revd. in part [1983] 1 S.C.R. 72; 46 N.R. 139, refd to. [para. 107].

Western Canadian Shopping Centres Inc. et al. v. Dutton et al., [2001] 2 S.C.R. 534; 272 N.R. 135; 286 A.R. 201; 253 W.A.C. 201; 2001 SCC 46, refd to. [para. 107].

Griffin v. Dell Canada Inc., [2009] O.T.C. Uned. 249; 72 C.P.C.(6th) 158 (Sup. Ct.), refd to. [para. 113, footnote 10].

Statutes Noticed:

Class Proceedings Act, S.O. 1992, c. 6, sect. 5(1)(a) [para. 13].

Competition Act, R.S.C. 1985, c. C-34, sect. 36(1) [para. 44]; sect. 52(1) [para. 43].

Consumer Protection Act, S.S. 1996, c. C-30.1, sect. 55 [para. 32].

Law Reform Act, R.S.N.B. 2011, c. 184, s. 4(1) [para. 32].

Sale of Goods Act, R.S.O. 1990, c. S-1, sect. 1(1), sect. 15 [para. 26].

Authors and Works Noticed:

Feldthusen, Bruce, Economic Loss in the Supreme Court of Canada: Yesterday and Tomorrow (1991), 17 Can. Bus. L.J. 356, pp. 357 to 358 [para. 55].

Feldthusen, Bruce, Economic Negligence: The Recovery of Pure Economic Loss (6th Ed. 2012), pp. 1 [para. 52]; 16, 17, 22, 23, 26 [para. 57]; 195 [para. 83].

Hansard (Ont.) - see Ontario, Hansard, Legislative Assembly, Official Report of Debates.

Linden, Allen M., and Feldthusen, Bruce, Canadian Tort Law (9th Ed. 2011), p. 470 [para. 51].

Ontario, Hansard, Legislative Assembly, Official Report of Debates, No. F-6, 3rd Sess., 37th Parliament (December 4, 2002) pp. F-60 to F-61 [para. 113, footnote 9].

Ontario, Law Reform Commission, Report on Class Actions (1982), p. 121 [para. 107].

Counsel:

Harvin D. Pitch and Adam Brunswick, for the appellants;

S. Gordon McKee, Timothy Buckley and Cheryl M. Woodin, for the respondents.

This appeal was heard on July 2, 2013, by Hoy, A.C.J.O., Feldman and Simmons, JJ.A., of the Ontario Court of Appeal. Hoy, A.C.J.O., delivered the following reasons for decision for the court on October 31, 2013.