Davie Shipbuilding Ltd. et al. v. Cargill Grain Co. Ltd. et al.

Davie Shipbuilding Ltd. et al. v. Cargill Grain Co. Ltd. et al.

Where an owner with superior, specialized technical expertise imposes design and basic data and the performing parties raised concerns but were instructed to proceed, the owner’s fault rebuts liability under art.1688 and exonerates the contractors/engineers who complied; in this case Cargill’s claims against Cobra, Foundation and Davie were dismissed because Cargill supplied the defective design and did not act on warnings.

Citation
[1978] 1 SCR 570
Parties
Defendant/appellant: Davie Shipbuilding Limited; Plaintiff/appellant: Cargill Grain Company Limited; Defendant/appellant: The Foundation Company of Canada Limited; Defendant/respondent: Cobra Industries Incorporated; Defendant/respondent: Hennessy Riedner & Associates Inc.
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
31 May 1977
Procedural Posture
Contract (action Under Civil Code Art. 1688) / Appeal to Supreme Court of Canada From the Court of Appeal for Quebec
Outcome
Appeals of Davie Shipbuilding and Foundation allowed; Cargill's cross-appeals dismissed; Cargill's appeal against Cobra dismissed; Cobra's cross-appeal dismissed.
Legal Topics
Liability for Defects, Owner's Fault and Exoneration, Architect/engineer/contractor Duties, Apportionment and Indemnity
Source Language
English
Contract Construction Civil Law Liability for Defects Owner's Fault and Exoneration Architect/engineer/contractor Duties Apportionment and Indemnity

Case Brief

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Parties

Davie Shipbuilding Limited

Defendant/appellant

Cargill Grain Company Limited

Plaintiff/appellant

The Foundation Company of Canada Limited

Defendant/appellant

Cobra Industries Incorporated

Defendant/respondent

Hennessy Riedner & Associates Inc.

Defendant/respondent

Procedural Posture

Contract (action Under Civil Code Art. 1688) / Appeal to Supreme Court of Canada From the Court of Appeal for Quebec

Legal Issues

  1. 1 Whether contractors and engineers are liable under Civil Code art.1688 for collapse caused by defects in design imposed by the owner
  2. 2 Whether an owner with superior technical expertise can exonerate or mitigate liability of contractors and engineers
  3. 3 Whether performing parties had a duty to verify or to notify the owner of mistakes in the owner's plans

Ratio Decidendi

Where an owner with superior, specialized technical expertise imposes design and basic data and the performing parties raised concerns but were instructed to proceed, the owner’s fault rebuts liability under art.1688 and exonerates the contractors/engineers who complied; in this case Cargill’s claims against Cobra, Foundation and Davie were dismissed because Cargill supplied the defective design and did not act on warnings.

Court Disposition

Appeals of Davie Shipbuilding and Foundation allowed; Cargill's cross-appeals dismissed; Cargill's appeal against Cobra dismissed; Cobra's cross-appeal dismissed.

Orders

  • Appeals of Foundation and Davie allowed with costs
  • Cargill's cross-appeals against Foundation and Davie dismissed with costs; judgments quashed and Cargill's counter-claim against Foundation and Davie dismissed, costs against Cargill in all Courts