ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: 119/02
Walkerton
DATE: 20120210

B E T W E E N:

NORMAN IGNACY LAW and BARBARA DAWN LAW

James Mays and A. Szczurko for the Plaintiffs

Plaintiffs

• and -

DAVID WHELAN cob as BALANCED HEATING AND AIR CONDITIONING SERVICES, GEORGE ALLAN HYMAS, DOROTHY ISOBEL HYMAS, MacDONNELL FUELS LTD. and TECHNICAL SAFETY AND STANDARDS SAFETY AUTHORITY

Douglas B. Kearns for Mr. and Mrs. Hymas
Karim N. Hirani for MacDonnell
Gary J. Marcuccio for Mr. Whelan
Alana Abells for the T.S.S.A.

Defendants

DECISION

D.L. CORBETT J.

1George and Dorothy Hymas sold their family cottage to Norman and Dawn Law in the autumn of 2001.

2Just a few months later, in April 2002, a leak was detected in the oil supply to the Laws’ cottage. The leak was inspected. It turned out to be quite a mess. The Laws called their insurer. The problem was fixed and the mess was cleaned up. It cost about $1 million. Whose fault was this? Certainly not the Laws’. They had owned the cottage a scant few months. They had not installed the furnace or the oil tank. They had barely unpacked.

3The Laws’ insurer paid for the clean-up. It then commenced these proceedings in the Laws’ name to recover its losses. It decided to use in-house counsel to prosecute the claim.

4The action was commenced in October 2002. One of the defendants, Mr. Whelan, was not served with the claim until February 2011, at which time the case had not yet been listed for trial.

These Motions

5The plaintiffs seek to extend the time to serve the statement of claim on Mr. Whelan, or to validate the service that was effected on him on February 11, 2011. Mr. Whelan argues that the plaintiffs should not be permitted to serve the claim on him so long after the event. The other defendants argue that the entire claim should be dismissed for delay.

Disposition

6On the merits, the plaintiffs appear to have a good claim against at least some of the defendants. Despite this, at the conclusion of argument I dismissed the plaintiffs’ motion to extend the time to serve the statement of claim on Mr. Whelan, with reasons to follow. I reserved on the motion to dismiss the action as against the other defendants.

7For the reasons that follow, I dismiss the motion to dismiss the action for delay. There is “inexcusable delay” by the plaintiffs between August 2008 and February 2011, but I am not persuaded that any of the defendants have been prejudiced by that delay to the extent that there is a substantial risk that a fair trial may now not be possible.

The Merits of the Laws’ Claims

8The Hymas’ had an oil tank, furnace and hot water heater installed at the cottage in 1998. They purchased the equipment from or by referral from the defendant MacDonnell. They contracted to purchase their fuel oil from MacDonnell.

9Mr. Whelan installed the oil tank, furnace and hot water heater and the line from the oil tank down to the cottage. It is disputed whether he did this as an employee of MacDonnell, an independent contractor of MacDonnell, or as a contractor hired by Mr. and Mrs. Hymas.

10The cottage sits near the shore of a lake. The shore slopes upwards from the lake. Access to the cottage ends in a parking area up a hill from the cottage. The furnace and hot water heater are, of course, down at the cottage. The oil tank is up at the parking area, where oil may be delivered to it by truck. There is a pipe running down the hill that connects the oil tank and the furnace and water heater at the cottage.

11There is a check valve on the pipe between the oil tank and the furnace and hot water heater. The check valve prevents oil from flowing back up the pipe towards the tank.

12Roughly two years after the equipment was installed, there was a leak down by the hot water heater. This leak was not a slow “drip”: it was a significant spill of about 250 litres of fuel oil. The Hymas’ called Mr. Whelan, who came out and repaired the leak. This repair was inspected and approved by TSSA in June 2000.

13The following year, Mr. and Mrs. Hymas sold the cottage to the Laws. In the agreement of purchase and sale, the Hymas’ made representations concerning environmental matters including soil contamination. They did not disclose the 250 litre fuel oil spill.

14It is likely that the check valve caused both spills. As oil in the pipe contracted during cold winter weather, more oil would have flowed down the pipe. When the weather warmed in the spring, the oil would have expanded. The check valve prevented the expanded oil from flowing back to the oil tank, and pressure built up in the pipe. Something had to give, and eventually it did.

15The Laws allege that the Hymas’ misrepresented the property in the agreement of purchase and sale: the spill in 2000 should have been disclosed..

16The Laws allege that Mr. Whelan was negligent installing and repairing the oil tank, furnace, and fuel line: the check valve should never have been installed, and this problem should have been corrected after the first spill.

17The Laws allege that TSSA was negligent inspecting the repairs after the 250 litre fuel oil spill: the repairs fixed the symptom but not the underlying problem, and this should have been apparent.

18The Laws allege that MacDonnell was negligent in its delivery of oil, and that MacDonnell is, in law, liable for the actions of Whelan in any event.

The History of this Proceeding

19July 1998: Mr. Whelan installs the furnace, oil tank, and related equipment.

20March 17, 2000: alleged oil spill on the property; allegedly 250 litres of fuel oil spilled.

21March 2000: Mr. Whelan attends the property to remedy the spill.

22October 12, 2001: plaintiffs purchase property from Mr. and Mrs. Hymas.

23April 14, 2002: second oil spill (basis of the claims in this proceeding).

24October 11, 2002: statement of claim.

25January 31, 2003: statement of claim amended.

26March 31, 2004: Hymas’ statement of defence, counterclaim and crossclaim.

27April 7, 2004: statement of defence and crossclaim of MacDonnell.

28May 8, 2004: statement of defence of TSSA.

29January 26, 2005: examination for discovery of the plaintiffs and TSSA.

30January 27, 2005: examination for discovery of MacDonnell.

31September 13, 2005: examination for discovery of Mr. and Mrs. Hymas.

32October 16, 2006: Counsel for TSSA writes to counsel for the plaintiffs asking if Mr. Whelan has been served, and if so, if a defence has been received from him. No response is provided to this letter.

33September 9, 2008: Mr. Barrett, counsel for an insurer involved in a related third party claim, writes to counsel for the plaintiffs asking for an update on efforts to locate Mr. Whelan and/or his liability insurer. No response is provided to this letter.

34September 17, 2009: Mr. Barrett again writes to counsel for the plaintiff asking for an update on efforts to serve Mr. Whelan or his insurer. No response is provided to this letter.

35April 15, 2010: Mr. Roti, counsel for TSSA, writes to counsel for the plaintiff asking if Mr. Whelan or his insurer have been located. No response is provided to this letter.

36October 4, 2010: Mr. Roti writes to plaintiffs’ counsel asking if the plaintiffs intend to pursue the litigation further. No response is provided to this letter.

37November 18, 2010: Mr. Roti writes plaintiffs’ counsel asking for a response to his letter of October 4, 2010. No response is provided to this letter.

38January 12, 2011: Mr. Roti writes again asking for a response to his previous letters. No response is provided to this letter.

39February 7, 2011: Siskinds LLP goes on the record for the plaintiffs.

40February 11, 2011: Mr. Whelan is served with the statement of claim.

(Decision continues exactly as in the source text.)

Released: February 10, 2012

D.L. CORBETT J.