RECOURSE BY PURCHASER AGAINST PROMOTER/GENERAL CONTRACTOR AND SUBCONTRACTOR FOR CONSTRUCTION DEFECT

The applicable legal principles are nicely illustrated in the recent Quebec Court of Appeal decision Desjardins Assurances Générales Inc. et al. -vs- Les Immeubles Devler Inc. et al., 2025 QCCA 586. In September 2017, Andreo purchased a new condominium from a seller who had acquired it from Les Immeubles Devler Inc. ("Devler"), the promoter/general contractor. In September 2018, Andreo became aware of water infiltration in the basement and hired a contractor and plumber to determine the cause. He also notified his insurer, Desjardins, and the condo syndicate. It was determined that the water infiltration was the result of the faulty installation of the air conditioning unit. In September 2018, Desjardins notified Devler who in turn notified its plumbing subcontractor ("LD"). Desjardins covered the cost of repairs up to $32,000 and the condo syndicate paid the insurance deductible in the amount of $5000. In September 2021 Desjardins, subrogated in the rights of Andreo and the condo syndicate, filed suit against Devler and LD for damages allegedly resulting from the faulty installation of an air conditioning wall unit. The contractor and subcontractor are solidarily liable for " ...the loss of the work..." occurring within five years from the completion of the work due to faulty construction (Article 2118 Civil Code of Quebec). According to case law, "loss of work" requires the existence of substantial damage to the construction. In the case at bar, plaintiff only relied upon this specific legal foundation for the claim. The trial judge dismissed the claim since although he found that the evidence established the existence of a construction defect, the damages were not substantial enough to amount to the "loss of the work". Desjardins and the condo syndicate successfully appealed the decision to the Court of Appeal. In addition to the legal basis of the claim hereinabove mentioned, the law also provides that the seller has a legal obligation to guaranty that the property sold is free from hidden defects. Furthermore, although the subcontractor LD had no contract with the Andreo, LD like any other third party, had a legal obligation to indemnify for damages resulting from its fault or negligence. At trial, Desjardins and the condo syndicate omitted to argue the additional legal grounds of liability of Devler and LD. The Court of Appeal noted that by law, the Trial Judge was required to give the parties an opportunity to make submissions with respect to a rule of law that was not debated before it (Article 323 Code of Civil Procedure). Since the Trial Judge did not do so and no additional evidence was necessary, the Court of Appeal considered and applied the overlooked legal foundations in support of the claim. Regarding the seller's warranty against hidden defects, the evidence clearly established that the air conditioner wall unit was improperly installed. The promoter was a professional seller and consequently, presumed to know of the existence of the hidden defect at the time of the sale. Although Andreo did not purchase the condo from the promoter, he purchased it from the person who purchased it from the promoter and her rights against the promoter were legally transferred to Andreo in vertu of the contract of sale as an accessory to the condo (Article 1442 Civil Code of Quebec). On this legal foundation, the Court of Appeal found that the claim against Devler was well founded. With respect to LD, it was at fault by improperly installing the air conditioner wall unit and therefore was delictually (as opposed to contractually) liable for the damages caused by its fault. Since Devler was contractually liable and LD's liability was delictual i.e. resulting from the general rules of civil responsibility, they could not be held jointly and severally liable to pay the claim but they could and were condemned "in solidum" meaning that they were each individually liable to pay the entire claim.