A.L. Gullison & Sons Ltd. v. Corey; Corey v. A.L. Gullison & Sons Ltd., (1980) 29 N.B.R.(2d) 86 (CA)

• Judge: Hughes, C.J.N.B., Limerick and Richard, JJ.A.
• Court: Court of Appeal (New Brunswick)
• Case Date: February 11, 1980
• Jurisdiction: New Brunswick
• Citations: (1980), 29 N.B.R.(2d) 86 (CA)

Gullison & Sons Ltd. v. Corey (1980), 29 N.B.R.(2d) 86 (CA);

    29 R.N.-B.(2e) 86; 66 A.P.R. 86

MLB headnote and full text

Sommaire et texte intégral

A.L. Gullison & Sons Ltd. v. Corey; Corey v. A.L. Gullison & Sons Ltd.

(30/AD/79)

Indexed As: A.L. Gullison & Sons Ltd. v. Corey; Corey v. A.L. Gullison & Sons Ltd.

Répertorié: A.L. Gullison & Sons Ltd. v. Corey; Corey v. A.L. Gullison & Sons Ltd.

New Brunswick Court of Appeal

Hughes, C.J.N.B., Limerick and Richard, JJ.A.

February 11, 1980.

Summary:

Résumé:

This case arose out of a building contractor's mechanics' lien claim against the owner of a new house. The owner took the contractor to see a house, which she liked. The owner purchased what she believed the plans for the house and contracted with the contractor for its construction. Initially, she told the contractor that she did not want to pay more than $50,000.00 for construction and requested an estimate from him for the purpose of obtaining bank finances. She requested that the estimate be high for that purpose. She understood that the contractor worked for cost plus 15% for profit and supervision. The contractor gave her an estimate of $48,495.00, which did not include the 15%, which the owner did not realize. The estimate influenced the owner in hiring the contractor. When the house as constructed from the plans turned out to be different from the house which was to be duplicated, the owner at first accepted the situation, but then ordered the contractor off the job. The contractor brought a mechanics' lien action against the owner and she brought an action against the contractor for damages for breach or abandonment of contract.

The New Brunswick Court of Queen's Bench, in a judgment reported 24 N.B.R.(2d) 638; 48 A.P.R. 638, allowed the contractor's claim and dismissed the owner's action. The owner appealed.

The New Brunswick Court of Appeal allowed the appeal in part. The Court of Appeal affirmed that there was a mutual mistake about the quality of the house to be built, which did not render the contract void. However, the Court of Appeal held that the contractor's failure to ensure that the owner understood that the estimate did not include the 15% for supervision and profit was a negligent misrepresentation for which it was liable to the owner in damages. See paragraphs 14 to 27, 33, 69, to 75.

Limerick, J.A., dissenting in part, was of the opinion that the contractor was not guilty of negligent misrepresentation in his estimate. See paragraphs 43 to 46.

Building Contracts - Topic 3546

Liability of builder - Duties to owner - Price or cost quotation or estimate - A woman hired a contractor to build a house, stressing that she did not want to pay more than $50,000.00 and understanding that the contractor worked on a cost plus 15% basis - The woman requested a cost estimate from the contractor for the purposes of obtaining a loan for construction and requested that the estimate be as high as possible for that reason - The contractor gave her an estimate of cost of $48,495.00, which did not include the 15% for profit and supervision, which the woman did not realize - Relying on the estimate she selected the contractor over another contractor - The New Brunswick Court of Appeal held that the failure of the contractor to ensure that the woman knew that the estimate did not include the 15% was a negligent misrepresentation, for which the contractor was liable in damages - See paragraphs 14 to 27, 33, 69 to 75.

Interest - Topic 4004

Statutory interest - Mechanics' liens - Mechanics' Lien Act, R.S.N.B. 1973, c. M-6, s. 47 - The New Brunswick Court of Appeal held that under s. 47 of the Mechanics' Lien Act interest could be awarded as a personal judgment on the amount of a successful lien claim; although the lien was for the amount claimed only and not for interest thereon - See paragraphs 39, 53, 80 to 90.

Mistake - Topic 684

Mistake about quality - Mutual or common mistake - The owner and the builder of a house under construction both mistakenly believed that the plan being used in construction would produce a house of certain dimensions - When it was discovered that the plan was not producing the house envisaged, the owner accepted the house as it was - The New Brunswick Court of Queen's Bench, held that, where both parties agreed upon the basic subject matter of the building contract, the mutual mistake about the quality of the house was not sufficient to render the contract void - The New Brunswick Court of Appeal dismissed the owner's appeal - See paragraphs 12 to 13, 42, 59 to 63.

Cases Noticed:

Hedley Byrne & Co. v. Heller & Partners Ltd., [1963] 2 All E.R. 575, appld. [para. 23]; dist. [para. 64].

Esso Petroleum Co. Ltd., v. Mardon, [1976] 2 All E.R. 5, appld. [paras. 23, 74].

Savoie v. Kenny (1975), 12 N.B.R.(2d) 91; 10 A.P.R. 91, appld. [para. 62].

Mutual Life & Citizens' Assurance Co. Ltd. et al. v. Evatt, [1971] 1 All E.R. 150 (P.C.), consd. [para. 25].

McInerny v. Lloyds Bank Limited, [1974] 1 L1.L.Rep. 246, appld. [para. 28].

Jordan v. Coleman and H.M. Tremball & Sons Ltd. (1975), 3 N.R. 502, appld. [para. 62].

Dakin v. Lee, [1916] 1 K.B. 566, dist. [para. 65].

Forman & Co. v. Ship Liddesdale, [1900] A.C. 190, dist. [para. 65].

Hoenig v. Isaacs, [1952] 2 All E.R. 176, dist. [para. 65].

Downie v. Norman (1965), 50 M.P.R. 150, dist. [para. 65].

Wagg v. Boudreau Sheet Metal, 43 M.P.R. 154, dist. [para. 65].

Fairbanks Soap Co. Ltd. v. Sheppard, [1953] 1 S.C.R. 314, dist. [para. 65].

Montgomerie & Co. Ltd. v. Wallace-James, [1904] A.C. 73, appld. [para. 73].

Earl F. Wakefield Company v. Oil City Petroleums (Leduc) Ltd. et al., [1958] S.C.R. 361, appld. [para. 85].

Brunswick Construction Ltd. v. Villa desJardins Inc. (1977), 17 N.B.R.(2d) 107; 23 A.P.R. 107, dist. [para. 86].

Toronto Railway Company v. Corporation of the City of Toronto, [1906] A.C. 117, appld. [para. 89].

Statutes Noticed:

Judicature Act, R.S.N.B. 1973, c. J-2, sect. 45(1) [para. 83].

Mechanics' Lien Act, R.S.N.B. 1973, c. M-6, sect. 47 [para. 81].

Authors and Works Noticed:

Hudson, Building and Engineering Contracts (10th Ed.), p. 587 [para. 77].

Counsel:

Brian Warnock, for the appellant;

D. Leslie Smith, for the respondent.

This case was heard on September 20, 1979, at Fredericton, N.B., before Hughes, C.J.N.B., Limerick and Richard, JJ.A., of the New Brunswick Court of Appeal.

On February 11, 1980, the judgment of the Court of Appeal was delivered and the following opinions were filed:

Hughes, C.J.N.B. - see paragraphs 1 to 41;

Limerick, J.A., dissenting in part - see paragraphs 42 to 54;

Richard, J.A. - see paragraphs 55 to 91.