College News

Le Westin Resort & Spa

Announcement The 11th Annual Canadian College of Construction Lawyers Conference will be held from May 29- June 1, 2008 at Le Westin Resort & Spa, Tremblant, Quebec.

Announcement The Fellows of the Canadian College of Construction Lawyers congratulate our friend and colleague, David H. Kauffman, on the publication of his latest book, The Construction Hypothec.

 

Featured Article - January 2008 ABB Inc. v. Domtar Inc., 2007 SCC 50 (November 22, 2007)   © Gregory B. Bordan Ogilvy Renault

Products Liability: In Quebec, Manufacturers Can’t Rely On Ignorance of a Defect as Their Sole Defence

The Supreme Court of Canada has just rendered a landmark decision on sellers’ and manufacturers’ liability in Quebec. In ABB Inc. v. Domtar Inc.,[1] the SCC upheld Domtar’s action against ABB Inc. and Alstom Canada Inc. for nearly 39 million dollars (capital and interest). This judgment is of the utmost importance to all manufacturers and other professional vendors selling in Quebec. It confirms the difficulty they will have relying on exclusion or limitation of liability clauses to escape liability for the consequences of latent defects in their products, even when dealing with sophisticated buyers. Manufacturers in particular will rarely be able to rely on such clauses, even though they are commonly included in contracts of sale.

THE FACTS

In the mid-1980’s, Domtar purchased a chemical recovery boiler for its new Windsor, Quebec pulp and paper mill from Combustion Engineering Canada Ltd. (“C.E.”). Just 18 months after the boiler was put into service, Domtar had to shut it down for an unscheduled inspection after detecting a leak in the boiler’s “superheater” (a major component of the boiler). The inspection revealed several leaks and hundreds of cracks. Domtar repaired the superheater and, at its next scheduled shutdown, replaced it entirely.

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