Does defective work always result in liability? A recent case between a homeowner and a contractor shows that a contractor may not necessarily be liable for damage to a new home.
FACTS
In this case the homeowner purchased a building lot and hired the contractor to build a custom home. Within two years after construction was completed, serious and expensive defects surfaced. Cracking and separation occurred in the patio, retaining and foundation walls, and cracking and buckling to the drywall occurred inside.
ISSUES
The question for the court was “Did the contractor breach the contract for failing to do a proper workmanlike job?” Simply put, ‘was the contractor responsible for the defects?’
DECISION
Both the homeowner and the contractor presented evidence from expert engineers supporting their view as to who was responsible for the defects. This inevitably resulted in conflicting expert opinions.
The engineer for the contractor determined that the cracking and separation points in the foundation walls were not caused by the foundation settling further after construction was completed or building movement. Instead, the engineer noted that the likely cause of the cracks to patio and retaining walls at the back of the house were likely the result of cyclical soils movement due to the freezing and thawing of the silty sand backfill in and around the rear of the home. Ultimately, the engineer came to the conclusion that, in a general sense, the observed cracks were of no structural consequence if they were properly sealed to prevent additional moisture from penetrating beneath the patio adjacent to the walls.
The engineer for the homeowner came to a slightly different conclusion, noting that building movement caused many, but not all of the defects. He was unable, however, to determine what the underlying cause of the movement was and agreed that some of the problems could be caused by an undetected source of water. He concluding opinion was that if the footings of the building were properly designed and built, the movement caused by freezing and thawing should not affect the building.
In resolving the conflicting evidence raised by the engineers, the court deferred to the fact that the City of Kamloops had received a certificate from a geotechnical consultant certifying that the footings of the building were suitable and had approved the continued construction of the house. Accordingly, while the court agreed that some of the defects to the house likely resulted from an unusual amount of settling that was probably water related, the court thought it would be unrealistic to blame the contractor for any subsequent problems that stemmed from a flawed footing that had been improperly approved.
However, the court was still faced with what it characterized as the “nagging problem with respect to the drywall.” For while the cracking drywall could be attributed to the building movement and the root cause of a faulty footing that was not the responsibility of the contractor (just as with the exterior cracking), the buckling drywall could have been caused by wood shrinkage, which may or may not be the contractor’s responsibility depending on the circumstances.
The problem the court had was that there was insufficient evidence produced by the engineers to lead to a determinative conclusion. The engineer’s report only addressed what the cause of the problem could be, and not what actually did cause the problem.
At the end of the day (actually a number of days in court), while the evidence suggested that the contractor may have rushed the construction of the building, the homeowner failed to prove on what is called the ‘balance of probabilities’ (being greater than 50% likelihood) that it was the contractor who actually caused or was responsible for most of the defects.
LESSONS LEARNED
- A contractor may not always be responsible for defects to a building even under suspicious circumstances.
- A contractor may be responsible for defects if the evidence sufficiently shows that the contractor did not construct the building properly.
- Ensure that any expert reports actually set out what caused the defects.
This article was written by Robert G. Kuhn and Ian C. Moes, lawyers who practice in construction law at the law firm of Kuhn LLP. It is only intended as a guide and cannot cover every situation. It is important to get legal advice for specific situations. If you have questions or comments about this case or other construction law matters, please contact us at 604-864-8877.
