Executive Summary: Key Legal and Evidentiary Issues

• This judicial review examined whether a Residential Tenancies Tribunal adjudicator committed a palpable and overriding error in awarding damages to a landlord.
   
• Central to the dispute was whether the Contributory Negligence Act applied to reduce the landlord's recovery based on alleged delays in the property restoration process.
   
• Evidence regarding a sewer backup and the resulting property damage formed the factual core of the underlying tribunal decision.
   
• Timing of the restoration RFP process, including alleged delay, was disputed between the parties, with the source record offering inconsistent explanations for the cause of that delay.
   
• Justice Stacy Ryan applied the deferential standard from Housen v. Nikolaisen and Benhaim v. St-Germain in assessing the adjudicator's findings.
   
• Ultimately, the court found no basis to disturb the tribunal's factual conclusions or its damages award.
   

Facts of the case

Care Givers Inc. (the "Applicant") rented a property from Dr. William Taylor Investments Inc. (the "Landlord" or "First Respondent") under an agreement entered into on July 5, 2018, with an initial one-year term from July 1, 2018, to July 1, 2019. Monthly rent was set at $1,950.00. The tenant issued a notice of termination effective January 31, 2023, but the parties continued on a month-to-month basis under the same terms. The rental agreement permitted the Applicant to modify the property for use housing individuals requiring specialized programming, on the condition that the property would be restored to its original condition upon vacating. The Applicant stopped housing individuals at the premises as of November 2022 and issued its termination notice on January 31, 2023, continuing to pay rent while seeking contractors to restore the premises. An RFP for restoration work was issued in April 2023 and extended to June 29, 2023. A sewer backup occurred on the premises sometime between June 28 and July 27, 2023, causing significant damage. Following a hearing, the Adjudicator ruled in favour of the Landlord, and the Applicant sought judicial review of that decision by way of certiorari.

Policy and legislative provisions at issue

The application was brought under section 50(1) of the Residential Tenancies Act, 2018, S.N.L. 2018, c. R-14.2, pursuant to Rules 54.02 and 54.06 of the Rules of the Supreme Court, 1986. The Applicant argued the Adjudicator failed to apply section 2 of the Contributory Negligence Act, R.S.N.L. 1990, c. C-33, which provides that where damage is caused by the fault of two or more persons, liability is apportioned according to degree of fault, or equally where degrees of fault cannot be established, and that no party is liable for damage to which their fault did not contribute.

Reasoning and analysis

The court identified the standard of review for the contributory negligence issue as palpable and overriding error, a standard described by reference to Housen v. Nikolaisen as an obvious error, and by reference to Benhaim v. St-Germain as one going to the very core of the case's outcome. The Applicant argued that the Landlord delayed the awarding of restoration work, suggesting the RFP closing date shifted from June 8 to July 13, 2023, due to the Landlord's property management agency demanding a right of first refusal and refusing contractor access. Separately, the Applicant argued that the Adjudicator gave no weight to evidence that the tenant was forced to obtain legal advice, which the Applicant described as delaying the closing date over the same period and as undisputed and uncontradicted. [Source note: the document presents two distinct explanations — the Landlord's agency conduct and the tenant's need for legal advice — for the same June 8 to July 13, 2023 delay, without reconciling them.] The First Respondent countered that no evidence from Western Health representatives supported the claim that its property manager's conduct delayed the RFP process, and that the Adjudicator had ample evidence to conclude the First Respondent was not contributorily negligent, including evidence that damages would have been limited to $42,500.00 had the backup been discovered promptly, but had escalated by the time it was found on July 27, 2023. The Adjudicator had found a duty of care existed between the parties, that a reasonably prudent tenant would have checked the property more than once in 30 days, and that the Applicant breached this duty by leaving the property unmonitored, with the backup going undiscovered for roughly three weeks. The Adjudicator also found this breach was not too remote to establish legal causation.

Ruling and overall outcome

Justice Ryan found no palpable and overriding error in the Adjudicator's decision, concluding there was ample evidence supporting it, and dismissed the application for judicial review brought by Care Givers Inc. The First Respondent, Dr. William Taylor Investments Inc., was the successful party and was awarded its costs in accordance with Column 3 of the Scale of Costs in the Appendix to Rule 55 of the Rules of the Supreme Court, 1986. The underlying damages award under review is stated as $107,481.25 in most references in the decision, though paragraph 38 states the amount awarded as $107,480.00.