The appellants (Fasco) appealed a motion judge's decision to strike their defences to claims for contribution and indemnity by the respondent (Venmar) based on res judicata and abuse of process.
The underlying dispute involved two separate house fires, six years apart, both allegedly caused by a defective heat recovery ventilation unit (HRV) manufactured by Venmar, containing a motor manufactured by Fasco.
The motion judge had found that prior Quebec litigation concerning the first fire precluded Fasco from raising certain defences in the Ontario actions.
The Court of Appeal allowed Fasco's appeal, finding that the motion judge erred by not applying the "plain and obvious" test, and incorrectly concluded that the causes of action and issues were identical between the Quebec and Ontario proceedings, particularly given the different factual contexts (e.g., Venmar's evolving knowledge of defects) and the contractual indemnity defence Fasco sought to raise.
The court also noted that the motion judge should have considered the timeliness of Venmar's motion.