Michael Gunsolus

The third party plaintiffs, who installed septic systems in a residential subdivision, were sued by the builder after 35 systems failed and had to be replaced due to non-compliant filter sand.

After settling the main action, the installers brought a third party claim against the aggregate supplier who provided the filter sand, alleging breach of contract and negligence.

The court found the supplier breached an implied warranty of fitness under section 15 of the Sale of Goods Act because the sand did not meet Ontario Building Code specifications.

The court awarded the installers their settlement costs and legal fees as damages, but apportioned fault, reducing the damages by 16.5% to account for the installers' own design and installation errors.

The negligence claim was dismissed due to a lack of expert evidence establishing the standard of care for manufacturing filter sand.

The applicant estate trustee applied to pass his accounts.

The respondent beneficiaries objected, alleging the trustee failed to pay debts, failed to diversify the stock portfolio, purchased shares on margin, improperly paid himself $70,000 as an alleged inter vivos gift, and incurred tax penalties.

The court found the trustee breached his fiduciary duties by failing to diversify and by making high-risk margin investments.

The court also found the $70,000 payment was an unperfected gift.

The trustee was removed and ordered to pay $357,140 to the estate to cover investment losses, tax penalties, excess compensation, and the invalid gift.