The case Earthco Soil Mixtures Inc. v. Pine Valley Enterprises Inc., 2024 SCC 20, involves a dispute over the sale of topsoil under the Ontario Sale of Goods Act (SGA). Key points include:
- Facts: Pine Valley purchased topsoil from Earthco for a municipal project but claimed the topsoil delivered did not match the specifications. They sued for damages. Earthco argued they were exempted from liability by contract clauses.
- Key Legal Issues:
- Implied Condition: Under section 14 of the SGA, goods must correspond to their description. Pine Valley alleged the topsoil failed to meet the implied condition.
- Exclusion Clauses: Clauses in the contract stated Earthco would not be responsible for the quality of the topsoil if Pine Valley waived its right to test the soil before delivery. Earthco argued these clauses negated the implied statutory condition.
- Contractual Interpretation: The court considered whether the exclusion clauses were sufficient to negate the implied statutory conditions.
- Court Decisions:
- Trial Court: Ruled in favor of Earthco, finding the exclusion clauses valid, and Pine Valley had accepted the risk by waiving testing.
- Court of Appeal: Reversed this decision, arguing that the exclusion clauses did not explicitly cover the identity of the goods, thus not negating the implied condition under section 14.
- Supreme Court of Canada: Reinstated the trial decision, holding that the exclusion clauses were sufficient, as the parties had clearly allocated the risk of not testing the topsoil.
- Outcome: Earthco was not liable for damages as the exclusion clauses validly negated their liability under the implied condition.
