Case information

Torts — Negligence — Negligent misrepresentation — Duty of care — Government action — In what circumstances “specific interactions” between public authorities and private parties will give rise to a relationship of proximity sufficient to ground a duty of care under R. v. Imperial Tobacco, 2011 SCC 42 — Whether an “implicit” undertaking can ground a duty of care in negligent misrepresentation under Deloitte & Touche v. Livent Inc. (Receiver of), 2017 SCC 63?

Case summaries are prepared by the Office of the Registrar of the Supreme Court of Canada (Law Branch). Please note that summaries are not provided to the Judges of the Court. They are placed on the Court file and website for information purposes only.

Charlesfort Development Limited purchased a property it intended to redevelop for a condominium project, conditional on, inter alia, rezoning of the property. During the rezoning process, a City planner told Charlesfort, in error, that an easement running along the northern edge of the project’s site line, but located on an adjacent property, contained a trunk sewer. In fact, the easement contained a four foot wide water main. The main was three to four feet north of the northern lot line, and it was old and in unknown condition. Millions of gallons of water flowed through it hourly. The misinformation was included in a staff report, and it was corrected by the Planning and Environment Committee at a meeting attended by Charlesfort’s principal planner. A City engineer also noted the presence of the main just north of the property in internal communications, but that response was not forwarded to the City’s planning department or to Charlesfort. The rezoning application was approved without any provision for a below grade setback. In September 2005, Charlesfort waived the purchase conditions concerning rezoning.

In August 2007, Charlesfort applied for site plan approval. During that process, it learned of the contents of the easement, and that the existence of the main meant that it could not excavate and construct its underground parking garage, which was planned to run along the northern lot line. Redesigning the proposed garage and reducing the available parking spots meant significant delays and increased cost. Charlesfort alleged that the City of Ottawa had negligently misrepresented what was in the easement during the rezoning process, and the that City was liable for Charlesfort’s damages, which were approximately $6 million.

The trial judge allowed Charlesfort’s action and awarded damages for increased development costs, lost revenue, and lost interest. The City’s appeal was granted.