Court of Appeal for Ontario

ONCA 707 Date: 2014-10-16 Docket: C58516

Before: Hoy A.C.J.O., Feldman and Blair JJ.A.

Between

Gay Company Limited

Plaintiff (Appellant)

and

General Sprinklers Inc.

Defendant (Respondent)

Counsel: Richard J. Mazar, for the appellant Christopher Valente, for the respondent

Heard and released orally: September 8, 2014

On appeal from the order of Justice Stephen T. Bale of the Superior Court of Justice, dated February 25, 2014.

Endorsement

[1] The appellant appeals the order of the motion judge allowing the respondent’s motion for summary judgment and dismissing the appellant’s action against the respondent.

[2] Briefly, the background is as follows.

[3] The appellant, a general contractor, hired the respondent to install a sprinkler system in a commercial building. The sub-contract between them required the respondent to “save harmless” the appellant from “any fines, cost, expenses, claims and charges”. The appellant alleged that defects in the sprinkler system installed by the respondent caused water damage to the building and, nearly three and one-half years after the water damage occurred, sued the respondent for breach of contract, claiming that the respondent had breached an implied term of the sub-contract that it would perform its work in a good workmanlike manner.

[4] The respondent moved for summary judgment dismissing the appellant’s action on the basis that the appellant’s action against the respondent was barred by s. 4 of the Limitations Act, 2002. The motion judge agreed that the appellant’s action was statute-barred, allowed the summary judgment motion, and dismissed the appellant’s action.

[5] On appeal, the appellant argues that the motion judge erred in concluding that its cause of action arose when the building suffered water damage and not when, more than three years later, the appellant sent the respondent an invoice for the out-of-pocket expenses it had occurred in repairing the building. The appellant says that it only knew that it had suffered damage when it sought reimbursement for the expenses it had occurred under the save harmless clause and the respondent refused to pay.

[6] We disagree. In our view, the motion judge correctly concluded that the appellant’s cause of action arose when the water damage occurred. From that date, the appellant asserted that the respondent was responsible for the damage. Indeed, shortly thereafter the appellant sent the respondent letters putting the respondent on notice that the appellant held it responsible for the damage and estimating the appellant’s costs to repair. For the purposes of the Limitations Act, 2002, the discovery date of the appellant’s claim against the respondent was accordingly when the loss occurred.

[7] In the result, this appeal is dismissed. The respondent shall be entitled to its costs in the amount of $4,500, inclusive of disbursements and HST.

“Alexandra Hoy A.C.J.O.”

“K. Feldman J.A.”

“R.A. Blair J.A.”