



COURT OF APPEAL FOR ONTARIO

CITATION: Rabb Construction Ltd. v. MacEwen Petroleum Inc.,
    2018 ONCA 170

DATE: 20180221

DOCKET: C64223

Hourigan, Roberts and Nordheimer JJ.A.

BETWEEN

Rabb Construction Ltd.

Plaintiff (Appellant)

and

MacEwen Petroleum Inc. and Greenland Corporation

Defendant (Respondent)

William G. Scott, for the appellant

Michael L. Kennedy and David Elmaleh, for the respondent,
    Greenland Corporation

Heard: February 16, 2018

On appeal from the order of Justice A.K. Mitchell of the
    Superior Court of Justice, dated July 17, 2017, with reasons reported at 2017
    ONSC 4353.

REASONS FOR DECISION

[1]

The appellant appeals from the dismissal of its motion to amend its
    amended statement of claim.

[2]

At the end of the hearing of the appeal, we allowed the appeal with
    reasons to follow.  These are those reasons.

[3]

The appellants action arises out of the damage to its equipment that it
    alleges was caused by defective hydraulic lubricant manufactured by the
    respondent, Greenland Corporation
[1]
.

[4]

In paras. 5 and 6 of its original statement of claim, the appellant
    pleaded that damage had been caused to three excavators by the use of
    Greenlands hydraulic lubricant.  The appellant subsequently sought to add two additional
    paragraphs
[2]
by way of amendment to particularize other pieces of equipment alleged to have
    been damaged by Greenlands hydraulic lubricant.

[5]

Greenland opposed the addition of these proposed paragraphs.  The motion
    judge accepted Greenlands submissions and did not permit the appellant to add
    these paragraphs for the reason that they purported to add new causes of action
    that she found were statute-barred.

[6]

The appellant submits that the motion judge erred in failing to treat
    the reference to the three excavators in the original statement of claim and
    the proposed reference to the additional equipment as particulars of the
    appellants claim for damages against Greenland, rather than as individual
    causes of action for each piece of equipment damaged by the allegedly defective
    hydraulic lubricant.

[7]

We agree.

[8]

First, the motion judge erred in misinterpreting the plain meaning of
    the proposed amendments and the amended statement of claim, which should have
    been read generously in favour of the amendments:
Farmers Oil and Gas Inc.
    v. Ontario (Natural Resources)
, 2016 ONSC 6359 (Div.Ct.), leave to appeal
    to ONCA refused, February 24, 2017 (M47111), at para. 31.  Specifically, she
    erred in restricting the appellants claim to its three excavators.

[9]

Paragraph 11 of the amended statement of claim clearly reads as a
    general summary of the appellants claim against the respondents.  It
    references the preceding paras. 9 and 10, which state general particulars of
    the alleged negligence of the respondents, without restricting the application
    of these allegations to any particular piece of equipment:

As a result of the aforesaid negligence and/or breach of
    contract of the Defendants, the Plaintiff sustained severe and extensive
    damages to
the Plaintiffs equipment
.  Extensive repairs and
    preventative maintenance efforts were required.  Full particulars of these damages
    will be provided to the Defendants prior to trial.  [Emphasis added.]

[10]

Although
    paras. 5, 6 and 7 refer to specific pieces of equipment (excavators), it is
    clear that those paragraphs do no more than set out as narrative how and when
    the appellant discovered the alleged problems with the use of Greenlands
    hydraulic lubricant.

[11]

Further,
    the motion judge erred in concluding that [t]he only logical inference to be
    drawn from the facts pleaded in para. 7 is that, other than the original
    equipment, no equipment of the plaintiff was affected by the use of the
    hydraulic lubricant supplied by Greenland.  This paragraph contains the
    plaintiffs admission that the hydraulic lubricant supplied by Greenland worked
    properly and without incident in all of the other equipment of the plaintiff.

[12]

Contrary
    to the motion judges interpretation, para. 7 does not contain any such admission. 
    Paragraph 7 reads as follows:  The Plaintiff has purchased environmentally
    friendly lubricant from the Defendants for a number of years
prior
to
    the subject incidents of mechanical failure without issue [emphasis added]. 
    This paragraph must be read in conjunction with the other paragraphs of the
    claim, including para. 11.  The only limitation expressly pleaded is one of
    time, namely, that prior to the discovery of the defectiveness of Greenlands
    hydraulic lubricant in 2012, the appellant experienced no issue with the
    lubricants manufactured by Greenland.

[13]

Finally,
    we are of the view that the motion judge erred in relying on
Grey
    Condominium Corp. No. 27 v. Blue Mountain Resorts Ltd.
(2008) 90 O.R. (3d)
    321, which is readily distinguishable from the present case.  In
Grey
    Condominium
, there were discrete, separate construction deficiencies
    arising from different and unrelated factual causes.  Moreover, the discovery
    of one of the construction deficiencies would not give rise to the discovery of
    the others.  As a result, the court in that case concluded that each of the
    construction deficiencies constituted a separate cause of action, subject to
    separate limitation periods, not because there were separate and distinct
    injuries, but because the deficiencies in question were distinct.

[14]

Here,
    by contrast, the sole cause of the same damage to all of the appellants affected
    equipment is alleged to be the hydraulic lubricant manufactured by Greenland,
    which the appellant has pleaded is defective.  As the motion judge correctly
    noted, discoverability of the cause of the damage was not in issue:  by March
    2014, the appellant discovered its claim that the hydraulic lubricant was
    defective and caused damage.

[15]

For
    the purpose of assessing the issue of discoverability, it is the claim that is
    discoverable and not the full extent of the damages that the appellant may be
    able to recover as a result of pursuing that claim; the exact extent of the
    loss need not be known:
Peixeiro v. Haberman
, [1997] 3 S.C.R. 549, at
    p. 557.

[16]

As
    a result, the appellants discovery of each additional piece of damaged equipment
    is the discovery of the extent or the amount of the damages to be claimed as a
    result of Greenlands alleged negligence in manufacturing defective hydraulic
    lubricant.  The discovery of each piece of damaged equipment does not amount to
    the discovery of a separate cause of action.  The sole alleged cause of the
    damage is the same:  Greenlands hydraulic lubricant that the appellant pleads
    was defective and negligently manufactured.  The motion judge erred in
    conflating the discovery of the claim with the discovery of the extent of the
    damages, and then concluding that the proposed amendments were statute-barred.

[17]

Accordingly,
    the appeal and the appellants proposed amendments are allowed.  The appellants
    shall have 30 days from the release of these reasons to amend, file and serve
    their amended amended statement of claim.  The respondents shall have 30 days from
    service to respond to the amended amended statement of claim.

[18]

The
    parties have agreed that the appellant is entitled to its costs of the appeal
    in the amount of $7,500 and to the costs of the motion to amend in the amount
    of $8,000, which are inclusive of disbursements and applicable taxes.

C.W.
    Hourigan J.A.

L.B.
    Roberts J.A

I.V.B.
    Nordheimer J.A.





[1]

The hydraulic lubricant was supplied to the appellant by the
    respondent, MacEwen Petroleum Inc.  This respondent took no position on the
    amendment motion.



[2]

The appellants other amendments were not opposed.


