Numerous claims have been made and legal proceedings instituted against manufacturers of sanitary toilet tanks in the past few years, following the unexplained spontaneous fracture of a tank. Typically, the fracture occurs in the absence of any immediate impact, often while the occupants are away. When fractured, the tank may to allow water escape for hours, sometimes days, before anyone can notice. It is precisely that scenario that has been the object of a judgment rendered recently by the Superior Court in Economical Mutual Insurance Group vs. Crane Canada. The judgment is interesting in many respects in that it meticulously analyses the many grounds of defence raised by the manufacturer.

In that case, the building had been built in 1985 and the tank manufactured in November 1984. The tank had been installed during construction of the building and had not been replaced when it broke in 1994, nine years later. The building owners had purchased the building in 1988 and occupied it since.

The fracture occurred in the tank of the master bathroom, traditionally a bathroom that is less utilized. The tank had not been repaired between 1988 and 1994 and had always operated properly.

The loss occurred during a week-end of August 1994. The owners and their two children had left their home on Friday to spend the week-end at their cottage. When they returned the following Sunday, they saw water coming from the second floor bathroom leaking throughout the house. After investigating and indemnifying its insureds, the insurer made a claim to the manufacturer of the tank.

We must remember that new provisions of the Civil Code of Quebec came into force in 1994 did not apply since the tank was manufactured and sold before. Consequently, the Civil Code of Lower Canada applied and which required prompt notice of a loss. In fact, the manufacturer was advised verbally in the days following the loss and in writing a few days later. The manufacturer denied liability.

The insurer alleged that the tank was affected by a latent defect and based its action on this argument. The defect consisted of a high or uneven level of porosity in the porcelain material forming the tank. The manufacturer’s defence was based on numerous arguments. Firstly, the manufacturer raised that it had not been informed that destructive tests were to be carried out, did not participate in those tests and did not have the opportunity of controlling how they had been carried out. Secondly, the manufacturer questioned the quality and value of the test results. Thirdly, the manufacturer raised that the fracture of the tank could as well have been the result of negligence during installation or abuse by the owners. Finally, the manufacturer obtained permission from the Court to carry out its own tests during the trial on what remained of the tank. Those tests purportedly revealed that the level of porosity met the standards generally accepted.

The trial Judge first held that the evidence adduced by the Plaintiff with regards to the existence of a latent defect was sufficient. The Court held that the tests carried out by both the experts of the Plaintiff (in 1999) and those of the Defendant (during the trial in 2009) had revealed uneven porosity levels. The porosity was much higher at the bottom of the tank than at the top, inducing stress in the material itself which ultimately resulted in the fracture. These uneven levels resulted from poor or incomplete cooking at the time of manufacturing. The Court added that a toilet tank that fractured after less than ten years of use (translation) “shocks the intelligence […] in the absence of better evidence of abnormal use or abuse”. The trial Judge then analyzed the arguments raised the defence.

The manufacturer’s first argument was that the Plaintiff’s expert had proceeded with the destructive tests on the tank in the absence of the Defendant’s experts. The manufacturer added that the tank should have been kept intact until trial so that the trial Judge could have looked at it. The manufacturer suggested that it would only be at that stage that tests would be carried out, i.e. during the trial. On the issue of the tests, the Court first noted that the Defendant’s experts had been invited in writing to participate and even make recommendations as to the method to be followed. That letter had received no reply and the Defendant could not later complain that the tests were carried out without its experts.

As to the Defendant’s argument that the tank had to remain intact until trial, the Court held that it was against the better interests of justice. The Court added:

“To come to a different conclusion would mean that a Tribunal could never rule on the origin of a fire or an explosion without having seen the good or the site prior to destruction.” [Our translation]

On the issue of the quality of the tests and conditions in which they were carried out, the Court again came to the conclusion that the tests carried out by the Plaintiff’s experts were appropriate such that the results were reliable even though the method prescribed by industry standards may not have been rigorously followed. Globally, the tests carried out by all parties revealed, in any event, significant differences in degrees of porosity which amounted to a latent defect in itself.

Finally, on the issue of the cause of the fracture itself, the Court held that the causes suggested by the Defendant’s expert were merely possibilities that were based on no tangible evidence. The theory of “abuse” proposed by the Defendant’s expert was not probative for several reasons. Firstly, the expert had seen the tank for the first time only four years after the loss. The several traces of impact noted by the expert could as well have been caused during that time. Such was the case for the handle controlling the operation of the tank. That plastic handle had been found broken after the loss but the owner had stated during the trial that it was in perfect condition while the tank was still inside the house. The handle thus necessarily had to have been broken during or after the removal of the tank. The Court also noted that an expert hired by the Plaintiff had seen the tank two days after the loss and had noted no trace of impact. That expert had also noticed that the fracture was not passing through any openings at the bottom of the tank. The expert had therefore eliminated improper tightening of the bolts holding the tank in place as a cause of the loss.

The judgment is well researched and reasoned. The Court analyzed and resolved a number of interesting issues. Unfortunately, the judgment is based on the provisions of the Civil Code of Lower Canada; however, it still contributes in correctly ruling on the issues of the extent of the burden of proof of a Plaintiff in an action for latent defects and the limits of that burden.

At the time of preparing this Communique, the delays to appeal the judgment had not expired. It may therefore not be the end of this story.