Following Damage To A House, Owners Seek Coverage Under Alberta’s Consumer Protection Act feature image

Following Damage To A House, Owners Seek Coverage Under Alberta’s Consumer Protection Act

As much as lawmakers might try to establish exactly who a law applies to, life is full of nuances that cause people to question whether a particular law applies to them or the situation they have found themselves in. That was the case in a recent decision issued by the Alberta Court of Appeal. The dispute was between two parties involved in a commercial dispute. The dispute involved defendants who were responsible for the moving of a house and associated materials and determining liability for damages that occurred during the move. The question before the court was whether the plaintiff should be covered by the Consumer Protection Act.

Buildings damaged in move

The plaintiff hired the defendants to move a series of buildings from one location to a large piece of land they own. The buildings included a house, a garage roof, and a gazebo. Each piece was delivered separately, and the plaintiffs allege that each of them was damaged during the move. As a result, they sought protection under the Act

In the meantime, the defendants filed a counterclaim, alleging the plaintiffs failed to pay the balance of their invoice. The defendants also said the plaintiffs could not seek coverage under the Act because they were going to use the house as a business, and were not “consumers” as defined in the Act.

The trial judge found that the Act did apply to the transaction and issued a ruling in favour of the plaintiffs. The defendants appealed, stating that the judge in the original decision erred in his interpretation of the Act.

The planned purpose of the buildings determines whether the plaintiffs were consumers

The Act is designed to protect consumers against mistreatment from businesses. The Act defines a supplier as a person who in the course of business provides “goods or services to consumers.” The definition of a consumer is a person who receives “goods or services from a supplier.” However, the definition stops short of including a person who “intends to sell the goods after receiving them.” In essence, it does not protect a business from a business. 

With this in mind, the issue the court had to work through was whether the plaintiff intended to use the building to carry out business.

Defendant says plaintiff intends to carry out business

The point at which the issue reached an impasse is how the plaintiffs intended to use the property that was being moved. 

The plaintiffs owned a large piece of land. They intended to place the buildings on their land, which included a farm they worked, and rent the house out until their retirement. After their retirement they planned to move into the house. However, until that time it would continue to be rented. 

The defendants said that the plaintiff’s plan to rent the house meant they were carrying on a business purpose, which would exclude them from the definition of “any service offered or provided primarily for personal, family or household purposes …”

Were the plaintiffs’ consumers or a business?

The court agreed with the trial judge that the plaintiffs met the definition of consumer under the Act. The trial judge said attention must be paid “to the statutory language, and the language directs that attention must be paid to the primary purpose of the service being considered, not the actual purpose for which the consumer engaged the services.”

The court said the question then becomes “ how to determine if a service is primarily for personal, family or household purposes.” In this case, the gazebo was placed behind the home the plaintiffs currently live in, not the house that was moved. Even considering the house, its purpose is for people to live in. Even if it is rented for a period of time, the primary purpose of a home is for a person to live in. Because if this, the court found it fit the definition and the appeal was denied. 

HMC Lawyers has experience in civil litigation

The Advocacy Team at HMC Lawyers has over 130 years of combined experience advising clients and litigating on their behalf. Our lawyers know that strategic action at an early stage can help settle matters early and expeditiously, and help prevent prolonged and expensive litigation. We work closely with clients to help them make good business decisions when facing a legal dispute.

To make an appointment with one of our lawyers about a commercial or business litigation matter, contact us online or call 1-800-480-3534.

 

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