Boehner (Doug) Trucking & Excavating Ltd. v. United Gulf Developments Ltd. et al., (2013) 324 N.S.R.(2d) 375 (SC)

• Judge: Robertson, J.
• Court: Supreme Court of Nova Scotia (Canada)
• Case Date: January 07, 2013
• Jurisdiction: Nova Scotia
• Citations: (2013), 324 N.S.R.(2d) 375 (SC);2013 NSSC 9

Boehner Trucking v. United Gulf (2013), 324 N.S.R.(2d) 375 (SC);

    1029 A.P.R. 375

MLB headnote and full text

Temp. Cite: [2013] N.S.R.(2d) TBEd. JA.045

Doug Boehner Trucking & Excavating Limited, a body corporate (plaintiff/defendant by counterclaim) v. United Gulf Developments Limited, a body corporate and Greater Homes Inc., a body corporate (defendants/plaintiffs by counterclaim) and W. Eric Whebby Limited (third party by counterclaim) and Garden Crest Developments Limited (fourth party by counterclaim)

(Hfx No. 192468; 2013 NSSC 9)

Indexed As: Boehner (Doug) Trucking & Excavating Ltd. v. United Gulf Developments Ltd. et al.

Nova Scotia Supreme Court

Robertson, J.

January 7, 2013.

Summary:

Contaminated soil was used in a residential subdivision developed by United Gulf and constructed by Greater Homes. The soil was excavated from Garden Crest's property, a downtown Halifax site that was being redeveloped, by Whebby and delivered for use by the landscape contractor (Boehner). The soil was not tested by anyone until it had been partly used and neighbours complained. The soil was removed at a significant remediation cost to United Gulf, whose only contract was with Boehner. Before trial, United Gulf and Boehner concluded a settlement agreement respecting the distribution of any damages that might be awarded to them. At issue was the liability of the various parties involved in the remediation of the contaminated soil.

The Nova Scotia Supreme Court, in a judgment reported (2006), 243 N.S.R.(2d) 265; 772 A.P.R. 265, held that all of the parties contributed to the loss. Liability was determinable under the law of negligence, although an argument could be made in nuisance and under the Sale of Goods Act. The court determined the liability of the respective parties and apportioned liability between Boehner, Whebby and Garden Crest. Whebby's liability was $221,510, which it was ordered to pay into court. Whebby appealed and applied for a stay of the judgment pending appeal, submitting that the failure of the recording system at trial (no trial transcript) was an exceptional circumstance warranting a stay because of the likelihood of a new trial. United Gulf, Greater Homes and Garden Crest cross-appealed.

The Nova Scotia Court of Appeal, per Cromwell, J.A., in a judgment reported (2006), 249 N.S.R.(2d) 326; 792 A.P.R. 326, dismissed the application. Boehner, the only respondent not to file a cross-appeal, applied under rule 62.31(7)(e) for an order extending the time to file and serve a notice of cross-appeal.

The Nova Scotia Court of Appeal, per Saunders, J.A., in a judgment reported (2007), 251 N.S.R.(2d) 138; 802 A.P.R. 138, allowed the application and granted an extension. The appeal and cross-appeals were subsequently heard on their merits.

The Nova Scotia Court of Appeal, in a judgment reported (2007), 258 N.S.R.(2d) 41; 824 A.P.R. 41, allowed the appeal and cross-appeals in part and remitted the matter for a new trial on certain issues. Particularly, there was to be a new trial on Whebby's negligence, Boehner's contributory negligence and Garden Crest's negligence. Also to be retried was United Gulf's negligence claim against Whebby, but not its nuisance claim. A new trial was required on Boehner's s. 17(b) Sale of Goods Act merchantable quality claim. United Gulf's negligence was not to be retried, but whether it mitigated its loss was. Whebby and Garden Crest had paid the damages they were liable for, with most going to Boehner. Boehner had financial problems and was unable to repay the damages. United Gulf undertook to pay on Boehner's behalf. Boehner discontinued its claim and assigned its contractual third-party claim against Whebby to United Gulf. Whebby brought a nonsuit motion or, alternatively, sought to stay the proceedings for want of prosecution (delay in proceedings) and to set aside the assignment as an abuse of process (champerty and maintenance).

The Nova Scotia Supreme Court, in a judgment reported (2010), 296 N.S.R.(2d) 17; 940 A.P.R. 17, dismissed Whebby's motion. The non-suit motion was premature. There were no grounds to stay the proceedings, as the delay was not inordinate and Whebby failed to establish prejudice. Finally, the assignment did not constitute an abuse of process on the basis of champerty or maintenance. United Gulf was not a stranger to the proceedings seeking to take the benefit of the proceedings. The new trial proceeded.

The Nova Scotia Supreme Court held if there was an accepted trade custom of not testing soil, which was not proved by evidence, such a custom failed to meet environmental regulations and societal expectations and could not be relied on. Whebby was negligent in failing to ensure that the soil it sold was free from contaminants, as it had a duty to ensure that the fill was suitable for residential backfill. The implied condition of merchantable quality (s. 17(b)) did not apply, as Boehner did not rely on Whebby in buying the fill. Boehner had as much, if not more, knowledge of the contamination than Whebby did. Whebby was liable for the cost of remediation, but not the extra cost of excavating and removing soils placed around residential foundations. United Gulf placed those soils there after it ought to have known of the contamination. This cost was not attributable to Whebby. Whebby's claim against Garden Crest was dismissed. Garden Crest made no express or implied representation that the soil was clean. In fact, some soil contamination was known to all. There was a protocol in place to remove any contaminated soil to Envirosoil (for remediation). Garden Crest had no knowledge that Whebby was selling the soil for residential fill rather than hauling it to Envirosoil.

Contracts - Topic 2090

Terms - Implied terms - Trade custom - Evidence and proof - [See Torts - Topic 795 ].

Sale of Goods - Topic 4108

Conditions and warranties - Implied or statutory terms as to quality or fitness - Merchantable quality - [See Torts - Topic 795 ].

Torts - Topic 795

Negligence - Construction operations - Contaminated soil or fill - Contaminated soil was used in a residential subdivision developed by United Gulf and constructed by Greater Homes - The soil was excavated from Garden Crest's property, a downtown Halifax site that was being redeveloped - Whebby excavated the fill and sold and delivered it for use by the landscape contractor (Boehner) - As was allegedly the customary trade practice, the soil was not pre-tested by anyone - The soil was removed from the residential properties at a significant remediation cost to United Gulf, whose only contract was with Boehner - At issue on a retrial of certain issues was Whebby's liability in negligence and under s. 17(b) of the Sale of Goods Act (implied condition as to merchantable quality) - The Nova Scotia Supreme Court held if there was an accepted trade custom of not testing soil, which was not proved by evidence, such a custom that failed to meet environmental regulations and societal expectations could not be relied on - Whebby was negligent in failing to ensure that the soil it sold was free from contaminants, as it had a duty to ensure that the fill was suitable for residential backfill - The implied condition of merchantable quality (s. 17(b)) did not apply, as Boehner did not rely on Whebby in buying the fill - Boehner had as much, if not more, knowledge of the contamination than Whebby did - Whebby was liable for the cost of remediation, but not the extra cost of excavating and removing soils placed around the residential foundations - United Gulf placed those soils there after it ought to have known of the contamination - This cost was not attributable to Whebby's negligence - Whebby's claim against Garden Crest was dismissed - Garden Crest made no express or implied representation that the soil was clean - In fact, some soil contamination was known to all - There was a protocol in place to remove any contaminated soil to Envirosoil (for remediation) - Garden Crest had no knowledge that Whebby was selling the soil for residential fill rather than hauling it to Envirosoil.

Cases Noticed:

Sound Images Inc. v. Solar Audio and Recording Ltd., 1995 CarswellNS 606 (S.C.), refd to. [para. 25].

Borgo Upholstery Ltd. et al. v. Canada (Attorney General) (2003), 211 N.S.R.(2d) 374; 662 A.P.R. 374; 2003 NSSC 32, affd. (2004), 220 N.S.R.(2d) 302; 694 A.P.R. 302; 2004 NSCA 5, refd to. [para. 26].

Statutes Noticed:

Sale of Goods Act, R.S.N.S. 1989, c. 408, sect. 17(b) [para. 24].

Authors and Works Noticed:

Fridman, G.H.L., Sale of Goods in Canada (5th Ed. 2004), pp. 167, 168 [para. 23]; 196 [para. 91].

Linden, Allen M., and Feldthusen, Bruce, Canadian Tort Law (8th Ed.), p. 109 [para. 15].

Counsel:

Robert G. Grant, Q.C., Sara Scott and Taayo Simmonds (articled clerk), for the defendants/plaintiffs by counterclaim;

George W. MacDonald, Q.C., Michael Blades and Sarah McInnes (articled clerk), for the third party by counterclaim;

David G. Coles, Q.C., Matt A. Conrad and Dana MacSween (articled clerk), for the fourth party by counterclaim.

This matter was heard on June 18-22 and 25-26, 2012, at Halifax, N.S., before Robertson, J., of the Nova Scotia Supreme Court, who delivered the following judgment on January 7, 2013.