Background of the Case:

• Ottawa Community Housing Corporation (OCHC) aimed to make its buildings more sustainable and cost-effective by addressing undetected toilet leaks through an energy retrofit, including the installation of the Flushmate System by Sloan, supplied by Wolseley.
• Post-installation, OCHC observed significant water consumption reduction until 2017, when a marked increase in water usage and costs was noted, attributed to the failure of a cartridge in the Flushmate System.
• Sloan provided 16,000 replacement cartridges in 2019, after which OCHC commenced this action in December 2022, seeking damages of $7,670,000 and unspecified special damages.

Facts of the Case:

• OCHC alleges the Flushmate System failed to operate as expected, leading to increased water consumption and costs.
• Sloan supplied replacement cartridges with a different O-ring type to address the issue.

Issues/Main Discussion:

• The motion discussed whether OCHC could claim breach of implied warranty and negligence against Sloan and Wolseley for economic losses only.

Ruling:

• The claim against Sloan based on implied warranties under the Sale of Goods Act (SGA) was struck as OCHC could not prove Sloan, the manufacturer who was not the seller, owed a duty of implied warranty.
• Claims in negligence were struck; it was found that OCHC could not claim for economic losses resulting from negligence as the damages sought did not relate to damaged or lost property but were for economic loss.
• OCHC is allowed to amend the pleading to incorporate allegations made against Sloan in regards to negligent misrepresentation.
• OCHC was ordered to pay the defendants $40,000 in costs for the motion.