Discovering a Latent Defect After a Cosmetic Complaint

The Dispute

A homeowner hired a contractor to replace the aluminum and glass railings around her home, and the contractor brought in a design firm to check the work as it went. Within a couple of months she raised concerns about the finish and the fit of the metal caps, which she took to be cosmetic problems. More than a year later a glass panel fell from its frame, and a later inspection found structural defects requiring full replacement rather than repair.

The Parties’ Positions

The design firm applied to strike the homeowner’s claim as filed outside the Limitation Act’s two-year discovery period. It argued that an email she sent the contractor in the summer of 2016, calling the completed work a mess, showed she already knew of the firm’s involvement and attributed the problems to its performance. In the alternative, it argued the deficiencies were readily visible on inspection, and that a diligent homeowner would have found them years before she filed her claim in the fall of 2018. It argued that the statute does not require actual knowledge, only that the loss and its cause were reasonably discoverable through the diligence a reasonable person in the homeowner’s position would have exercised.

The homeowner resisted the application, maintaining that her early concerns were limited to the finish and fit of the work. Nothing available to her before the fall of 2018, she said, pointed to a structural problem or to a failure to meet the Building Code. A specialist’s report obtained that fall, after a glass panel came loose the previous year, was the first indication that the installation could not be repaired and had to be replaced entirely, and she filed her claim within two years of it. She noted that her own inspections, and those of the specialists she brought in along the way, kept finding no more than what looked like finishing problems until the report identified a design and construction issue with the entire structure.

The Court’s Decision

The court found that by the summer of 2016 the homeowner knew only that the design firm had some involvement in work she considered cosmetically deficient, and did not then know, and had no reason to know, that the installation was structurally unsound. It held that the specialist’s report obtained in the fall of 2018, the first document to say the work could not be repaired and did not meet the Building Code, was the point at which her claim against the design firm crystallized. The court accepted that the steps she took between raising cosmetic concerns and obtaining that report, including bringing in further contractors and specialists to look at the work, were reasonable and did not extend the delay unfairly. It found that her claim met the Limitation Act’s discovery requirements and dismissed the design firm’s application to have it struck out as statute barred.

Key Lessons for Homeowners and Design Professionals

• Separate a cosmetic complaint from a structural one in writing when it is raised. The court found that knowing the design firm was involved in cosmetically deficient work did not put the homeowner on notice of the structural, code-noncompliant condition a specialist later identified.
• Bring in a specialist before assuming a defect is only cosmetic. It took a second inspection and an engineer’s report, obtained after a glass panel had already come loose, to establish in this construction defect dispute that the installation could not be repaired and had to be replaced entirely.
• Treat the limitation clock as tied to the specific defect discovered, not to the first sign that something is wrong. The court held that the claim was not discovered until the homeowner learned the installation was structurally unsound, years after she had raised only cosmetic concerns.
• Keep field-review correspondence and invoices on file for the full limitation period. The application turned on when the homeowner could be taken to have known of the design firm’s role, and its own invoices helped establish that timeline.

The outcome of this application turned on when the court found the homeowner’s claim was discovered, not on the underlying defects themselves, which have not yet been decided. A similar dispute may resolve differently.

ATAC LAW acts for homeowners and for design and construction professionals in disputes over defective work in British Columbia, including limitation defences.

Mike C. Stewart, a partner at ATAC LAW, acted for the homeowner at the trial of the limitation issue in the Provincial Court of British Columbia.