May 2, 2014
April showers bring … flood and sewage back-up claims. Flooding and sewage back-up can result in significant damage for municipal ratepayers, so ratepayers place a high value on municipal water and sewer services. And when there’s a problem, they quickly look to the municipality to make good any damage or loss. The best way for a municipality to minimize liability exposure for flood and sewer claims is to understand the most significant risks it faces – and the key defences available to it. Here are the three most common claims and three most common defences.
Claims
A home or business owner who experiences damage related to water or sewer, or her insurer, sometimes sues the municipality. The three most common types of claims are:
Negligence. Negligence claims by homeowners and businesses against municipalities for sewer backup and overland flooding are the most common. Court decisions demonstrate that proper maintenance is important for municipalities to avoid liability, particularly in cases of a known or foreseeable risk. For example, in one case a business flooded during a heavy rainfall and the owner sued the municipality. The court decided the municipality failed to both remove debris from a nearby catch basins and pipes and to install a curb to prevent water from flowing across a piece of land and onto the owner’s property. The court concluded the municipality was negligent.
Environmental Legislation. Environmental legislation (for example, the NS Environment Act) typically both:
A conviction under the legislation can lead to civil liability: in a civil claim for resulting damages, proof of conviction can be used as evidence that the municipality was negligent. Legislation might give a municipality a statutory defence against claims for damages arising from failure in its inspection system – but the municipality may still be liable for the potentially significant costs of remediation measures.
Negligent Approvals. Municipalities are also exposed to liability for negligently issuing approvals. For example in one case a municipality knew a piece of land was only marginally stable, but still issued a development permit. The land owner breached certain conditions in the permit, including that he refrain from installing a certain type of irrigation system. Part of his yard collapsed into an abutting ravine, and his house was damaged. He sued the municipality. The court decided the municipality owed a special duty to ensure the owner was aware of the risks of using the prohibited irrigation system – and was 35% liable for the damage.
Defences
When a municipality is sued, it has some unique defences available to it because it’s a public body. The three most common are:
Policy Decision. A municipality is immune from liability if it made a policy – as opposed to an operational – decision:
In one case snowmelt couldn’t drain into the municipality’s catch basin because of ice and snow. Instead, it ran into a person’s driveway – and basement. The person sued the municipality. The municipality argued that it would be too costly to keep every catch basin in the municipality fully operational at all times, and it had followed its policy for inspections. The court decided this was a policy decision, and the municipality could not be held liable.
Statutory Authority. A municipality might also avoid liability by relying on the defence of statutory authority. This defence requires that a statute not only authorize the municipality to do something but also authorize the way it is to be done.However, if a statute authorizes the municipality to do something – but not how to do it – then it can be liable for damages if it could have done the authorized thing in a way that avoided damage to others.
Statutory Immunity. Partly as a reaction to court decisions that tended to increase municipal liability, several Provinces have amended municipal statutes to provide immunity from certain claims, other than negligence. The result is a municipality simply can’t be sued for these claims. For example, the N.S. Municipal Government Act includes statutory immunities for liability:
Courts do tend to construe these defences narrowly. For example, in one case, there was statutory immunity against damages for a sewer system’s breakdown or malfunction. Gravel built up in a sewer causing it to back-up and flood. A homeowner successfully sued the municipality: the court decided there was neither a “breakdown” nor a “malfunction” of the sewer system, but rather a failure to maintain it.
Keeping the Pipes Clean
Municipalities will likely continue to face liability exposure from flooding and sewage backup claims given the importance of water and sewer service to municipal ratepayers, the significant damage that can occur, and the perception that municipalities have deep pockets. Minimizing this exposure is challenging. The best starting point is:
Knowledgeable legal counsel can help municipalities take these steps and minimize exposure.
Please contact your McInnes Cooper lawyer or any member of our Municipal Law Team @ McInnes Cooper to discuss what steps to take and how to minimize your liability exposure.
McInnes Cooper has prepared this document for information only; it is not intended to be legal advice. You should consult McInnes Cooper about your unique circumstances before acting on this information. McInnes Cooper excludes all liability for anything contained in this document and any use you make of it.
© McInnes Cooper, 2014. All rights reserved. McInnes Cooper owns the copyright in this document. You may reproduce and distribute this document in its entirety as long as you do not alter the form or the content and you give McInnes Cooper credit for it. You must obtain McInnes Cooper’s consent for any other form of reproduction or distribution. Email us at [email protected] to request our consent.
Mar 30, 2023
The Alberta Court of Appeal recently sent a strong message to insureds: utmost good faith is not only key but is required in insurance claims.…
Dec 13, 2022
The insurer’s duty to defend a claim made against its insured is inextricably tied to coverage: there can be no duty to defend without a…
Apr 18, 2022
On March 28, 2022, the Supreme Court of Newfoundland and Labrador (General Division) decided that in a personal injury case, quantification of…
Mar 29, 2022
The Supreme Court of Canada’s recent consideration of estoppel and waiver in the context of a fatal injury case in Trial Lawyers Association…
Mar 4, 2022
On December 17, 2021, New Brunswick’s Local Governance Reform Act (Bill 82) amending the N.B. Local Governance Act (and other related acts and…
Nov 23, 2021
On November 19, 2021, in Trial Lawyers Association of British Columbia v. Royal & Sun Alliance Insurance Company of Canada, the Supreme…
Oct 29, 2021
On October 21, 2021, the Supreme Court of Canada clarified the law concerning the circumstances in which government organizations - including…
Sep 23, 2021
On September 9, 2021, the Nova Scotia Court of Appeal released its decision in Aviva Insurance v. PK Construction Ltd. Dealing with Nova…
Jun 11, 2020
New types of claims will emerge while insurers may see an evolution or even decrease in the traditional types. Here are the types of claims and…
Apr 17, 2020
The global and domestic spread of COVID-19 has forced Canadians to reassess their upcoming travel plans – and insurers to assess their travel…
Feb 14, 2020
NOTE: On July 23, 2021, the Supreme Court of Canada agreed with the Newfoundland & Labrador Court of Appeal’s decision respecting the law,…
Jan 14, 2020
On December 23, 2019, the Newfoundland and Labrador Court of Appeal effectively eliminated the category of “knowledgeable fact witness” in…
Nov 22, 2019
On November 20, 2019, the Nova Scotia Court of Appeal confirmed pursuant to section 113BA(1) of Nova Scotia’s Insurance Act, in the context of…
Jan 21, 2019
On January 18, 2019, the Nova Scotia Court of Appeal rendered its unanimous (5-0) decision in Holland v. Sparks, overturning a motion decision…
Oct 25, 2018
NOTE: On November 20, 2019, the Nova Scotia Court of Appeal upheld the trial court’s decision and confirmed pursuant to section 113BA(1) of…
Oct 12, 2018
On October 11, 2018, the Nova Scotia Court of Appeal released its first decision considering the saving provision in Section 12 of Nova…
May 11, 2018
On May 8, 2018, for the first time, the Nova Scotia Supreme Court has ruled on the deductibility of Workers’ Compensation Board Extended…
Apr 26, 2018
The N.S. Court of Appeal has reached two decisions ending one employee’s quest for coverage of the costs of his medical marijuana – at least…
Jan 25, 2018
Insurers have generally been leery of coverage for medical cannabis in both the health benefit claims and in cost of care claims in the personal…
Jul 10, 2017
The legal landscape of cannabis (a.k.a. marihuana, weed, pot …) is changing, both reflecting - and contributing to - more relaxed attitudes…
Jun 5, 2017
On June 2, 2017, the Supreme Court of Canada decided that where a plaintiff advances a claim for negligently caused psychological or psychiatric…
May 3, 2017
On May 2, 2017, the N.S. Court of Appeal decided another case involving the deductibility of CPP disability benefits – but this time, in the…
Apr 20, 2017
On April 13, 2017, Canada’s federal government introduced legislation that, if passed into law, will legalize recreational cannabis in Canada.…
Apr 6, 2017
Adding a third jurisdiction to Gard Update’s comparison between privilege in the corporate context under U.S. and English law, McInnes Cooper…
Mar 15, 2017
On March 9, 2017, the N.S. Court of Appeal stopped building inspection claims in their tracks when it decided that a defence based section…
Jan 30, 2017
On January 27, 2017, the Supreme Court of Canada decided in Sabean v. Portage La Prairie Mutual Insurance Co. that future CPP disability…
Jan 25, 2017
Doing business with the public sector creates an often overlooked – but very real – risk that the confidential information a business…
Nov 28, 2016
On November 25, 2016, the Supreme Court of Canada decided privilege wins again - twice. In two separate decisions - Lizotte v. Aviva Insurance…
Sep 19, 2016
On September 15, 2016, the Supreme Court of Canada decided certain damage to a building under construction was covered under the relevant…
Sep 12, 2016
On September 9, 2016, the Supreme Court of Canada decided in Musqueam Indian Band v. Musqueam Indian Band (Board of Review) that an Indian band…
Aug 17, 2016
The Newfoundland and Labrador Court of Appeal recently affirmed the test for confirming a cause of action and thus resetting a limitation period…
Jul 5, 2016
The Ontario Court of Appeal has re-ignited the discussion about when a municipality will be held liable for its shoddy bylaw enforcement…
Jun 20, 2016
As of July 1, 2016, packed cargo containers to which the International Convention for the Safety of Life at Sea (SOLAS), Chapter VI, Regulation…
Jun 20, 2016
Real estate vendors and purchasers have high expectations of their realtors – and they don’t often hesitate to pursue legal action against…
Jun 17, 2016
In its June 16, 2016 decision in Rogers Communications Inc. v. Châteauguay (City), the Supreme Court of Canada decided a municipality’s…
May 10, 2016
On May 6, 2016, the Supreme Court of Canada generally affirmed the common law rule that positive covenants do not run with the land. More…
Apr 15, 2016
On April 14, 2016, Canada’s federal Justice Minister proposed legislation setting out the conditions that a person wishing to undergo…
Mar 24, 2016
When a business responds to a public sector Request for Proposal or Expression of Interest (both of which we’ll refer to as an RFP for these…
Jan 27, 2016
On January 21, 2016, the Ontario Superior Court of Justice dramatically expanded the scope of legal privacy protection – and the liability…
Jul 21, 2015
On July 16, 2015, the New Brunswick Court of Appeal ordered an insurer to produce a significant amount of its financial and business information…
Jun 8, 2015
On June 4, 2015, the NS Court of Appeal decided the value of future CPP disability benefits is deductible under the SEF 44 family protection…
Apr 15, 2015
On April 15, 2015 the Supreme Court of Canada decided the City of Saguenay’s recitation of a religious - though non-denominational – prayer…
Feb 18, 2015
The new NS Limitations of Actions Act – the legislation that determines the limitation period (time limit) in which a lawsuit must be started…
Feb 9, 2015
NOTE: On April 14, 2016, the federal government proposed legislation setting out the conditions that a person wishing to undergo…
Nov 3, 2014
Note: On November 20, 2014 the NS Government passed the final form of Bill 64, Limitations of Actions Act into law. The final form of the Act…
Sep 9, 2014
Effective October 1, 2014, the New Brunswick Rules of Court will change – some Rules for the first time since they came into effect in 1982.…
Jul 10, 2012
On March 16, 2012, the Supreme Court of Canada (“SCC”) confirmed the decision of the N.S. Court of Appeal, reinstating the N.S. Human Rights…
Subscribe to McInnes Cooper to stay current with our leading insights on legal updates, trends, news, events, and services.