BG Checo successfully bid to erect transmission towers on BC Hydro's property. The contract said that BC Hydro would clear their land before the towers were erected, but they did not. As a result, BG Checo's work was more difficult and expensive. They sued in breach of contract and negligent misrepresentation. The lower courts allowed BG Checo to claim in both contract and tort, which BC Hydro appealed.
- If there is a breach of contract, can you also sue in tort for the negligent misrepresentation that led to the breach?
La Forest and McLachlin, writing for the majority, decide that they can sue in both causes of action, and that there are different remedies for both actions because the law should allow wronged plaintiffs to recover in any way possible. In the contract action, the goal is to put the plaintiff in the position that they would have been in if the contract was performed. In the negligence action the damages could amount to any loss that reasonably stemmed from the negligence, as the goal is to put the plaintiff in the place they would have been in if the representation never happened.
They state that a tort action is only disallowed if it is explicitly set out that this is the case in the contract. In this case, the contract did not limit the BC Hydro's duty. Therefore, they have the ability to sue in both, but this case needs to be sent back to trial to determine the damages in tort.
They also state that the damages for breach of contract are to put the party in the position it would have been in had the contract been completed.
- A plaintiff is always allowed to sue in both tort and contract, if they both apply, so long as the relevant duty necessary for the tort action is not explicitly negated in the contract.
- The goal of damages for breach of contract is to put the party in the position it would have been in had the contract been completed.