Is There Anything We Should Know About the House?

On May 30, 2023, the Supreme Court of Yukon released a decision in Lavoie vs. Ewert,2023 YKSC 25—a dispute that involves multiple alleged hidden defects in a newly purchased home.

Case Context
A home was built between fall 1992 and spring 1993 by an original contractor, and nearly 30 years later that home has brought them to the courthouse. The case in question is ongoing and was bought by the plaintiffs in 2021 who allege that their house had many defects at the moment of purchase, including black mould, structural problems and a fox issue that make the property uninhabitable. Alongside the original contractor stand the other co-defendants: the previous owners, the real estate agent who sold the home to the plaintiffs (i.e., the new owners), the inspector hired to evaluate its state and the municipality. 

Upon the purchase of the home, the plaintiffs allegedly inquired of their real estate agent: “Is there anything we should know about this house?” to which they were supposedly told, “No, nothing.” Later, the plaintiffs entered an agreement with a house inspector who had to check the house for any issues. The allegation is that inspector found no significant problems with the property. However, the plaintiffs allege that the following defects were present in the residential property at the time of the purchase agreement and make their house unfit for its intended use:

• Unapproved renovations by previous owners
• Carpenter ants
• Black mould
• Structural problems
• Water damage
• Presence of foxes and fox dens

How Many Foxes are Too Many Foxes?
While several defects are alleged, a significant one to the plaintiffs is the fox issue. The previous owners had supposedly spoken about a pleasant fox sighting from time to time around their property to the real estate agent. During the final walk-through, it was allegedly mentioned that there are foxes who play around the yard and have a den nearby. While this may sound something akin to a Disney movie, the plaintiffs were not of the same whimsical opinion as the previous owners. Instead, the plaintiffs allege that the issue brings unwanted foxes to their door, as well as fox pathogens viruses, bacteria, parasites and diseases (including the mystical sounding “echinococcus granulosus infection”)—all of which the new homeowners consider a threat. 

How the Court contends with the fox issue will be an interesting one to watch. Do a fox and its litter of kits pose a threat and should it be included in the list of home defects? Or will it be found that the presence of this fox and its kits truly constitutes a simple pleasant occasional sighting?

A Single Issue by Summary Trial
The original contractor submitted an application for a summary trial to have the claims against them dismissed. The plaintiffs have responded by bringing an application of their own, seeking that the original contractor be barred from dismissing the initial application, because the relief sought is not suitable for a summary trial. 

According to the Supreme Court Rules in Yukon, there is allowance for single issues to be resolved by summary trial. It is noted that the Court must use special caution to resolve only one issue in such a fashion, as some negative outcomes could arise:

• Case could proceed in a piecemeal fashion
• Delays and unnecessary expenditure of resources could be caused
• Multiple appeals could ensue
• Interlinking of facts and issues may not be readily apparent when questions are presented in isolation

To determine whether a single-issue application was appropriate, the Court considered

• whether necessary findings of fact can be made;
• the nature and complexity of the issues;
• the costs to the Court system and the parties.

      1. Findings of Fact

The Court determined that the facts were few and mostly agreed upon. Little evidence was needed, no credibility findings were to be made and no legal conclusions were heavily reliant on findings of fact. These factors all pointed to a summary trial being appropriate. 

       2. Nature and Complexity of the Issues

The original contractor does not have complex arguments, and there is case law addressing similar issues. Since the question of discoverability is not related to the other issues in this litigation, it was found that this factor was satisfied and supports proceeding by way of summary trial. 

       3. Costs to the Court System and the Parties

It was found that resolving the single issue by way of summary trial would not cause delay or impose additional unreasonable costs to the parties. In fact, it could lead to efficiencies for those involved. Should this single issue be resolved at summary trial, then the original contractor would no longer be a party in the action, which would remove them from the full trial if they were to be successful. 

Decision
The Court found that since the facts and issues involved were not complex—and that some efficiencies would be gained if a summary trial were held—, a summary trial was indeed appropriate. Be that as it may, the original contractor’s application for summary dismissal was rejected by the Court, and the litigation will continue.

Should you have any questions or need further information on this insight or on related matters, please contact Don Dear, K.C., in our Calgary office.