Catre Industries Ltd. v. Alberta, (1987) 97 A.R. 1 (QB)

• Judge: Marshall, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: April 21, 1987
• Citations: (1987), 97 A.R. 1 (QB)

Catre Ind. Ltd. v. Alta. (1987), 97 A.R. 1 (QB)

MLB headnote and full text

Catre Industries Ltd. (plaintiff) v. Her Majesty The Queen In Right Of Alberta (defendant)

(No. 7903-02484)

Indexed As: Catre Industries Ltd. v. Alberta

Alberta Court of Queen's Bench

Judicial District of Edmonton

Marshall, J.

April 16, 1987.

Summary:

In August 1973, Catre Industries was awarded a contract to build a highway grade 22 miles long for the Province of Alberta. The Province had accepted Catre's bid of $919,298.80 with a completion date set for November 1973. Catre started operations in August 1973 but did not complete the job until October 1976. Catre commenced an action against the Province of Alberta claiming its total costs plus a reasonable profit ($3,716,647.29) on a quantum meruit basis. Catre claimed the entire scope and character of the contract was fundamentally changed from what it had bargained to construct. Alternatively Catre claimed damages for breach of contract and in the further alternative damages for negligent misstatements by the Province in the preparation of soil information and design of the project. The Province counterclaimed for various expenses relating to the contract.

The Alberta Court of Queen's Bench allowed Catre's action, holding that the Province was liable for breach of implied terms in the contract and liable in tort for negligent misstatements. The court assessed damages accordingly, however, Catre's damages were reduced by 50% because of contributory negligence in performance of the contract. The court dismissed the Province's counterclaim.

Building Contracts - Topic 581

The contract - Implied terms - Suitability of design - Catre Industries agreed to construct a highway grade for the Province of Alberta - The highway was not completed until three years after the original completion date because of misleading soil information provided by the Province coupled with inadequate designs - The Alberta Court of Queen's Bench held that the Province breached implied terms in its contract to provide accurate soil information and a project design which was not defective - See paragraphs 85 to 99.

Building Contracts - Topic 582

The contract - Implied terms - Duty of owner to provide accurate information - [See Building Contracts - Topic 581 above].

Building Contracts - Topic 707

The contract - Plans and specifications - Owner's duty respecting - Catre Industries agreed to construct a highway grade for the Province of Alberta - The highway was not completed until three years after the original completion date because of misleading soil information provided by the Province coupled with inadequate designs - The Alberta Court of Queen's Bench held that the Province was liable for negligent misstatement (i.e., breaching its duty to provide accurate information) - See paragraphs 100 to 103.

Building Contracts - Topic 710

The contract - Plans and specifications - Reliance by builder on plans etc., supplied by owner - [See Building Contracts - Topic 707 above].

Building Contracts - Topic 746

Contract - Interpretation - Investigation of conditions by builder - Catre Industries agreed to construct a highway grade for the Province of Alberta - The contract required Catre to investigate the conditions in the area of the project - The Alberta Court of Queen's Bench held that the "investigation" did not imply a subsurface investigation - See paragraphs 84 to 88.

Building Contracts - Topic 747

The contract - Interpretation - Exclusionary clauses - Catre Industries agreed to construct a highway grade for the Province of Alberta - The highway was not completed until three years after the original completion date because of misleading soils information provided by the Province coupled with inadequate designs - The Alberta Court of Queen's Bench held that the Province breached implied terms in its contract to provide accurate soil information and a project design which was not defective - The court examined the exclusionary clauses in the contract and held that they were inapplicable - See paragraphs 85 to 99.

Building Contracts - Topic 906

The contract - Breach - Fundamental breach - What constitutes - Catre Industries agreed to build a highway grade for the Province of Alberta - The highway was not completed until three years after the original completion date because of misleading soil information provided by the Province and inadequate designs - The Alberta Court of Queen's Bench held that the Province fundamentally breached the contract, but Catre was not entitled to damages because it continued to work on the project after the fundamental breach and was, therefore, deemed to have not pursued its remedy of fundamental breach - See paragraphs 76 to 84.

Building Contracts - Topic 3347

Liability of builder - Negligence - Lack of skilful performance of contract - Catre Industries agreed to build a highway grade for the Province of Alberta - The highway was not completed until three years after the original completion date because of misleading soil information provided by the Province and inadequate designs - The Alberta Court of Queen's Bench held that the Province breached implied terms in the contract and was liable in tort for negligent misstatement - The court reduced Catre's damages by 50% however, because of Catre's contributory negligence in its lack of skilful performance of the contract - See paragraphs 117 to 122.

Contracts - Topic 3730

Performance or breach - Fundamental breach - What constitutes - [See Building Contracts - Topic 906 above].

Damages - Topic 3630

Deceit and misrepresentation - Negligent misrepresentation - Catre Industries agreed to build a highway grade for the Province of Alberta - The highway was not completed until three years after the original completion date because of misleading soil information provided by the Province and inadequate designs - The Alberta Court of Queen's Bench held that the Province breached implied terms in the contract and was liable in tort for negligent misstatement - The court calculated the damages accordingly - See paragraphs 104 to 111 - The court reduced the damages by 50% however, because of Catre's contributory negligence in its lack of skilful performance of the contract - See paragraphs 117 to 122.

Damages - Topic 6528

Contracts - Building contracts - Measure of damages - [See Damages - Topic 3630 above].

Torts - Topic 6626

Defences - Contributory negligence - Negligent performance of contract - [See Building Contracts - Topic 3347 above].

Cases Noticed:

Peter Kiewit Sons' Company of Canada Ltd. et al. v. Eakins Construction Ltd. (1960), 22 D.L.R.(2d) 465, folld. [paras. 80, 83].

Morrison-Knudsen Co. Inc. et al. v. B.C. Hydro & Power Authority (1978), 85 D.L.R.(3d) 186 (B.C.C.A.), refd to. [para. 80].

Cardinal Construction Ltd. v. Brockville (1984), 4 C.L.R. 194 (Ont. H.C.), refd to. [para. 87].

Warden Construction Co. Ltd. v. Grimsby (1984), 2 C.L.R. 69 (Ont. C.A.), refd to. [paras. 92, 98].

Falcon Lumber Ltd. v. Canada Wood Specialty Co. Ltd. (1978), 23 O.R.(2d) 345 (Ont. H.C.), refd to. [para. 95].

Sodd Corp. Inc. v. Tessis (1977), 17 O.R.(2d) 158 (C.A.), refd to. [paras. 96, 103].

West Coast Paving Co. Ltd. v. British Columbia (1983), 4 C.L.R. 300 (B.C.S.C.), refd to. [para. 99].

Foundation Co. of Canada Ltd. v. Alberta, 10 C.L.R. 210, refd to. [para. 102].

Canadian Western Natural Gas Company Limited v. Pathfinder Surveys Ltd. (1980), 21 A.R. 459; 12 Alta. L.R.(2d) 135 (C.A.), refd to. [paras. 102, 103, 117].

Canada Trust Company v. Rafuse and Cordon, [1986] 2 S.C.R. 147; 69 N.R. 321, refd to. [para. 118].

Noel and Blanchette Construction Ltd. v. Medican Construction Ltd. (1984), 53 A.R. 17 (Q.B.), refd to. [para. 118].

Caisse Populaire D'Inkerman Ltée v. Doiron (1985), 61 N.B.R.(2d) 123; 158 A.P.R. 123; 2 C.C.L.T. 73 (C.A.), refd to. [para. 118].

Bagby v. Gustafson Drilling, 24 A.R. 181, refd to. [para. 123].

Eyben v. K.R. Ranches (1982), 38 A.R. 336, refd to. [para. 123].

Statutes Noticed:

Contributory Negligence Act, R.S.A. 1980, c. C-23, sect. 1(1) [para. 122].

Authors and Works Noticed:

Goldsmith, Canadian Building Contracts, p. 106 [para. 94].

Counsel:

J.E. Redmond, Q.C., for the plaintiff;

A.P. Hnatiuk, for the defendant.

This case was heard before Marshall, J., of the Alberta Court of Queen's Bench, who filed the following decision on April 21, 1987.