Brian Madigan LL.B., Broker
BRMadigan@Rogers.com

RE/MAX West Realty Inc.,
Brokerage
Independently owned and operated

96 Rexdale Blvd. 
Toronto, Ontario 


Phone: 416-745-2300

Cell: 647-404-8150 
Toll Free: 1-888-507-0817

Search in:  
    
    
       

Sort by:

Mould and Buyer's Remedies

July 18, 2018 - Updated: July 18, 2018

Mould and Buyer’s Remedies
 

The Superior Court of Justice in Ontario recently dealt with a Buyer’s claim for personal injuries arising from the presence of mould in a home.
 

The litigation was of “long duration”. The mould was discovered in 2002 and rectified within a month’s time. The Plaintiff alleged that he had suffered significant mental and psychological harm as a result of the presence of the mould. According to the claim he sold his house, he lost his marriage and he continued to suffer mental and physical injuries, all related to the presence of mould.
 

The lawsuit continued from 2003 to 2017, a period of 14 years. Finally, the Defendant decided to bring a conclusion to the “endless” lawsuit by seeking a decision of the court based upon a summary dismissal of the claim. Mr. Justice Monahan decided the case on 8 December 2017.
 

Summary of the Facts
 

The Plaintiff, Albert Capelet and his wife, Luisa purchased a newly built home from Brookfield Homes in 1997 for $263,900.
 

Two years later in 1999, Albert noticed signs of water leakage and in early 2002 he discovered mould in the basement.
 

The mould was discovered in February of 2002 was remediated by Brookfield approximately one month later, and was habitable by 22 March 2002.
 

Capelet sold the home in November 2002 for $347,000 which was over $20,000 more than appraised value (without the mould). Capelet acknowledged he did not suffer a loss on the sale as a result of the mould.
 

Capelet commenced the action in October 2003 for emotional/psychological injuries and physical injuries (including "shortness of breath and other lung problems, sinus problems, eye and other infections, skin irritation and other health problems") claiming the sum of $6 million dollars.
 

Brookfield had secured medical and engineering expert reports which concluded Capelet had not suffered any injury (physical or psychological) as a result of the residential mould exposure.
 

When pressed, late in the lawsuit, Capelet obtained an Expert Report that he had developed:
 

" 'Adjustment Disorder with Mixed Anxiety and Depressed Mood' with symptoms that include low mood, feelings of sadness, worry, anxiety, insomnia and poor concentration" which had been caused by "the mould incident, combined with Mr. Capelet's inability to successfully address and rectify the problem"
 

Further this resulted in "an emotional crisis for him". This adversely affected his life including by way of a fight with his wife about it in 2014 which lead to his arrest and their subsequent separation.
 

According to Judge Monahan, in respect to the legal proceedings:
 

12) By late 2016, despite the fact that the litigation had been commenced 13 years previously, Mr. Capelet still had not served medical or other expert reports required to substantiate major components of his claim. Accordingly, in October 2016, Brookfield brought the present motion for summary judgment.
 

[16]           Although the plaintiff amended his statement of claim within the past year, he has not pleaded a claim for income loss or punitive damages.  He maintains that, since these claims have not been pleaded, Brookfield is not entitled to seek summary judgment on them as “they are not at issue in the litigation”.  
 

He suggests that the proper forum to determine whether the plaintiff is entitled to proceed with a claim for income loss or punitive damages is a motion to amend the statement of claim.  The plaintiff has not brought any such motion, but argues that Brookfield cannot raise these issues and have them dealt with on this motion for summary judgment.
 

                                                (see Judge’s comments below)
 

On 8 December 2017, Mr. Justice Monahan granted Summary Judgment for Brookfield:
 

  • There was no genuine issue for trial on any of the claims advanced by Capelet; and

 

  • Awarded costs on a partial indemnity basis for $45,000.
     

The Court held that in order for a claim of psychiatric or mental injury to be compensable, they must be reasonably foreseeable (per Mustapha v Culligan of Canada Ltd. [2008] 2 S.C.R. 114) which was not the case here.
 

The Court held:
 

[22]           Claims for psychiatric or mental injury must be reasonably foreseeable in order to be compensable through the law of negligence.
 

In cases where mental injury is claimed, it must be shown that the injury in question is one that a person of “ordinary fortitude” would suffer in the relevant circumstances.  
 

Thus in Mustapha v. Culligan of Canada Ltd.,[5] (“Mustapha”), a plaintiff who suffered psychiatric injuries from observing dead flies in a bottle of drinking water could not recover for the injuries because they would not have occurred in a personal of ordinary fortitude.  
 

As Chief Justice MacLachlin noted for a unanimous Court, this rule is not intended to marginalize or penalize those particularly vulnerable to mental injury.
 

It merely reflects the fact that tort law does not function as insurance for mental injury claims.  
 

The law of negligence “seeks to impose a result that is fair to both plaintiffs and defendants, and that is socially useful.”[6]  
 

It is for this reason that mental injury or distress must be reasonably foreseeable before it becomes compensable through the law of negligence.
 

And, further:
 

[25]           Assuming these findings to be true, the issue is whether this kind of reaction could be said to be a reasonably foreseeable consequence of the discovery of mould in one’s home.  
 

Would a person of “ordinary fortitude” have reacted in the way the Mr. Capelet did to the discovery of mould?
 

There is no evidence in the record before me supporting such a finding.  
 

In fact, there is considerable evidence supporting the opposite conclusion, namely, that Mr. Capelet’s reaction to the mould was highly unusual and the product of particular sensitivities on his part.
 

 

According to the Court, Dr. Bloom concludes that:
 

"the problem with the mould in his house and ensuing litigation has, for him, snowballed into something that other people wouldn't have seen as so large and immovable as Mr. Capelet has come to experience it."
 

“… the events in question, including the litigation, have become a cause celebre for Mr. Capelet because they have provided a tangible target onto which he has (unconsciously) displaced an accumulation of insufficiently addressed grievances and psychological injustices originating in his past."

 

The Court also stated:
 

[28]           On the evidence before me, it is not entirely clear whether Mr. Capelet’s current emotional and psychiatric problems are a result of his pre-existing conditions, as opposed to his exposure to the mould.  
 

I am prepared to assume, for purposes of this motion, that his current emotional and psychiatric difficulties can be attributed, in whole or in part, to exposure to the mould.  
 

Nevertheless I am of the view that this loss is not compensable through the law of negligence for the simple reason that it is not a reasonably foreseeable consequence of faulty home construction.
 

[29]           Ontario has long regulated the rights and responsibilities of purchasers and builders of new homes in Ontario.[16]  
 

This includes warranties regarding the proper construction of the home, a process for conciliation of disputes, and a guarantee fund to provide compensation to purchasers who have suffered losses from breach of warranty.  
 

This scheme does not provide compensation for emotional or psychiatric injuries suffered by purchasers resulting from defects in their new homes.
 

 

[30]           The February 1997 agreement of purchase and sale between Mr. Capelet and Brookfield incorporated the warranty provided at that time under the Ontario New Home Warranty, and provided that this warranty constituted the full extent of the purchaser’s right to recover for “damage, loss or injury of any sort.”[17]  
 

Accordingly, it was not within the contemplation of the parties at the time of the entering into of the APS that Mr. Capelet would have a right to claim for emotional or psychiatric losses resulting from defects in construction of the Property.

 

[31]           As the Supreme Court of Canada noted in Mustapha, the law of negligence seeks to achieve a result that is fair to both plaintiffs and defendants and that is “socially useful”.
 

 If purchasers of new homes could recover for emotional or psychiatric damages suffered from defects in house construction, these costs would necessarily have to be factored into the price of new homes and paid for by purchasers.  
 

I see no authority or mandate for this Court to assume this cost-shifting role.  

 

[32]           In my view, therefore, Mr. Capelet’s claims for emotional or psychiatric injury are not a reasonably foreseeable consequence of faulty home construction by Brookfield, and are not recoverable as a matter of law.  There is no genuine issue requiring a trial with respect to this head of damage.
 

There was also the matter of certain claims which had not been pleaded and therefore were not included in the lawsuit.
 

The Judge said this:
 

Unpleaded Claims

 

[52]           The above analysis is sufficient to dispose of all the claims pleaded in the statement of claim.  
 

However, the plaintiff argues that he intends to amend the statement of claim and advance claims for additional heads of damage, including income loss and punitive damages.  

 

He argues that since these additional claims have not yet been pleaded, they cannot be considered or dealt with on this motion for summary judgment. 

 

 

[53]           In my view, the plaintiff’s approach on this issue is inconsistent with the underlying philosophy and approach set out in Hryniak.  

Summary judgment is intended to expedite rather than delay matters.  

 

The plaintiff has provided no explanation as to why, 14 years after commencing the action, he has not yet pleaded all aspects of his claim.  

 

In fact, the plaintiff on examination for discovery acknowledged that he had not suffered any income loss, and I see no basis whatsoever for a claim for punitive damages.  

 

In short, the prospect of additional, as yet unpleaded claims is little more than a delay tactic to keep the litigation on life support, resulting in further cost and delay to the parties and the justice system.

 

[54]           I have found that there is no genuine issue requiring a trial on the claims pleaded by the plaintiff.  
 

The defendant is accordingly entitled to summary judgment, and the plaintiff cannot resist this outcome by relying on unpleaded claims with little apparent merit.

 

COMMENT

 

Strange case!

 

Even after 14 years, the plaintiff is arguing that he wants to add in extra stuff, like his “loss of income”. Surely, 14 years was enough time to figure this out?

 

In most cases, issues can run through the entire Court system from pleadings to discoveries to motions, to trials and appeals in 7 years. Why was this case “double” that, and we didn’t even reach an actual trial date, let alone appeals?

 

His marriage broke down…. due to the presence of mould in the house for one month? Perhaps, it wasn’t the best marriage or perhaps, there were other reasons?

 

Fourteen years of litigation is quite a waste of money on everyone’s part. Who has the money to fund this? Who has this amount of time to waste?

 

Notwithstanding that the case itself is quite strange, and appropriate sympathies offered to Albert for all his problems, there were some points that are valuable for real estate.

 

 

Brian Madigan LL.B., Broker

www.iSourceRealEstate.com


Tagged with: litigation mould remedies prolonged lawsuit delay ontario law
| | Share

Brian Madigan LL.B. Broker

RE/MAX West Realty Inc. Brokerage

Independently owned and operated

96 Rexdale Blvd. , Toronto Ontario,

Phone: 416-745-2300

BRMadigan@Rogers.com

Powered by Lone Wolf Real Estate Technologies (CMS6)