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TERMS - Express terms - Exclusion clauses

Thursday, April 30, 2020 @ 9:29 AM  

Lexis Advance® Quicklaw®
Appeal by the plaintiffs from a summary trial decision upholding a contractual limitation of liability clause in favour of the defendants. The plaintiffs entered a contract to purchase a residential property. The purchase was subject to a home inspection report. The plaintiffs engaged the defendants to conduct the inspection for a fee of $525. The inspection contract included a limitation clause that restricted the defendants’ liability to the inspection fee. The clause was expressly brought to the plaintiffs’ attention at the time of signing. The plaintiffs accepted the defendants’ report and proceeded with the purchase. Approximately two months later, the plaintiffs discovered water leaking into the home from a sundeck. They alleged that deficiencies in the home caused damages exceeding $350,000. The plaintiffs sued the inspectors, among others, alleging negligence and negligent misrepresentation for the failure to detect and report the deficiencies. The defendants pleaded the provisions of the contract, including the limitation clause. A summary trial judge held that the plaintiffs’ claim was squarely within the limitation clause, and thus their maximum recovery against the defendants was contractually limited to the inspection fee. The plaintiffs appealed.

HELD: Appeal dismissed. The judge did not err in finding the limitation clause issue suitable for summary determination. The matter did not involve novel issues, and its disposition greatly assisted the parties in determining what resources should reasonably be devoted to the trial. The judge did not err in finding that the limitation clause was applicable to the plaintiffs’ claims. Gross negligence was not pleaded and nothing in the pleadings or evidence supported an allegation of gross negligence. The judge did not err in finding that the limitation of liability clause was not contrary to public policy in light of a subsequent regulatory amendment that would prohibit inclusion of such clauses. The fact of a policy change was insufficient to retroactively override the parties’ contractual arrangements.

Ferrer v. Janik, [2020] B.C.J. No. 370, British Columbia Court of Appeal, H. Groberman, A.W. MacKenzie, S. Stromberg-Stein JJ.A., March 5, 2020. Digest No. TLD-April272020008