May 2010

Extracontractually liable respect to a third party when carrying out a mandate

By Genevieve Forget Lawyer

Is a professional who receives a mandate and commits a fault when executing this mandate accountable only to the person who engaged hisher services? The answer is no. The professional may, in fact, be ordered to pay damages to the third party affected by the poor execution of the mandate and even sued.

This was the case in the matter of 3979687 Canada inc. v. Consultants LBCD inc. (JE 2010-664).

A company mandated an engineer from the LBCD firm to carry out soil analyses to determine whether or not a lot was contaminated. In 1996, a report was drafted and submitted to the company, concluding that the land was contaminated and that the rehabilitation process was undertaken in keeping with the requirements of the Ministère de l'Environnement. In 2003, the company wanted to sell the land and mandated the same firm to update the report, which was then submitted to the promising buyer, 3979687 Canada inc. The report stated that the contamination was minimal and superficial and could easily be remediated when digging the foundations. The sale was closed.

However, the contamination was extensive, and the new owner incurred some $200,000 in decontamination costs.

The owner therefore launched a suit against the engineering firm.

The firm was found liable by a Superior Court judge, who considered that the buyer had decided to purchase the lot only once it had received the certification that it was decontaminated. Because the firm's guarantee caused the damages, it was ordered to reimburse the decontamination costs.