A landlord's obligation pursuant to article 1854 C.C.Q.

March 2007

A landlord's obligation pursuant to article 1854 C.C.Q.

bouton-vers-francaisCertain owners of rental properties (and, consequently, their insurers) have not yet realized the sizable burden imposed upon them by the Civil Code of Québec since its 1994 reform.
 
A Superior Court judgment rendered on January 23, 2006, by the Honourable Madam Justice Pierrette Sévigny reminds us of this fact quite clearly.
 
In CGU v. Guindon and Assurances générales des Caisses Desjardins1, the ruling asserts the principle of the obligation of result owed by owners of residential property, an obligation which they cannot escape (Articles 1854 and 1893 C.C.Q.).
 
Mr. Guindon, the insured of Desjardins, had rented his house in Saint-Sauveur to the insured of CGU. Mr. Guindon had been living in the house for five years when he decided to rent it out. Less than six months after having taken possession of the house, the tenant was the victim of a fire which broke out in the house. The cause of the fire was an electrical defect of which the owner had been unaware.
 
Madam Justice Sévigny found that the relationship between Mr. Guindon and his tenant was contractual, given that the lease had been submitted as evidence. She then had to determine the application of Article 1854 C.C.Q.
 
Formerly, the Civil Code of Lower Canada stipulated that landlords had to provide a warranty to their tenants against hidden defects; however, they could defend themselves by showing that they had been unaware of the existence of the defect.
 
Through its 1994 reform of the Civil Code of Québec, the Legislature significantly extended the scope of an owner’s obligation by introducing new Article 1854:

“The lessor is bound to deliver the leased property to the lessee in a good state of repair in all respects and to provide him with peaceable enjoyment of the property throughout the term of the lease.
 
He is also bound to warrant the lessee that the property may be used for the purpose for which it was leased and to maintain the property for that purpose throughout the term of the lease.”

In his “commentaries” the Minister of Justice stated that this article had been inspired by former Articles 1604 and 1606 C.C.L.C. However, he pointed out that it differed from them in that it replaced the concept of hidden defect with the warranty of fitness for purpose; he specified that, pursuant to Article 1893 C.C.Q., the second paragraph was compulsory in respect of dwellings.
 
From the moment it came into force, commentators have attributed a very broad scope to Article 1854, seeing therein an obligation of result imposed upon landlords. In the texts prepared by the Québec Bar and the Chambre des notaires du Québec regarding the reform of the Civil Code, Me Nicole Archambault wrote the following:

[translation]
 
“Together with the landlord’s obligation to provide peaceable enjoyment and the obligation to maintain the property (Article 1854), the new rule, which is much more demanding of the landlord while, at the same time, facilitating the tenant’s recourse, constitutes a major change to the existing system.” (Volume 2, page 632)

Me Archambault pointed out that the notion of “real or presumed knowledge” of a defect by a landlord had been abandoned to such an extent that any defect resulting in harm would be presumed to be the landlord’s responsibility. Only superior force or the fault of a third party (including that of the tenant) would release the landlord from this responsibility.
 
Thus, in CGU v. Guindon, the Honourable Madam Justice Sévigny—having concluded that the cause of the fire had been a defect (whether or not hidden) in the electrical system—found the landlord contractually responsible under Article 1854 C.C.Q.

Doctrine and caselaw

This decision forms part of an evolving legal doctrine and caselaw which will, over the long term, likely confirm the obligation of result imposed upon landlords.2
 
In his book on leases, Professor Pierre-Gabriel Jobin, as early as 1996, commented on the disappearance of the notion of a landlord’s knowledge of the existence of a defect. According to his interpretation of Article 1854, this resulted in a warranty by the landlord that the leased property could serve for the purpose for which it had been leased.
 
Subsequently, Jacques Deslauriers, in “Vente, louage, contrat d’entreprise ou de service” published in 2005, defined a landlord’s obligation to maintain the property as being an obligation of result.
 
As regards the caselaw, it should be noted that the first decisions dealing with this matter were decisions rendered by the Régie du logement in Godbout v. Gaudet3 and Manolis v. Hébert4
 
Thereafter, this notion was further developed before the Court of Québec in the Lopez v. Beaudoin5 decision rendered by Mr. Justice Raymond P. Boyer on February 10, 1999. In this case, the lessee had suffered a fire whose probable cause was an electrical defect. After referring to the landlord’s obligation of result, Mr. Justice Boyer discussed the extent of the evidence required on the part of the owner in order to set aside this obligation. In that case, the landlord testified that he had had the electrical system entirely changed when he had purchased the building, approximately seven years before the fire occurred. However, he also acknowledged that he had carried out certain electrical work without the assistance of a qualified electrician. This was all Mr. Justice Boyer needed in order to find the landlord liable.
 
In December 2002, it was Mr. Justice Robert Mongeon of the Superior Court who rendered a ruling in Langlois v. Morissette6. He held the landlords responsible for the damage suffered by the tenant as a result of a construction or design defect affecting the property’s septic system:

[translation]
 
“Article 1854 C.C.Q. is clear on this matter. Moreover, this is an obligation of result which supplements the obligation of warranty set out in this article.”7

Finally, the Court of Appeal ruled on Article 1854 in Avanti 2000 inc. v. Lombard8 in a unanimous decision rendered on December 22, 2004.
 
This case, too, involved a fire, one resulting from an improper splicing of electrical wires which was considered to be a hidden defect. Madam Justice Dutil, speaking for the Court, wrote the following:

[translation]
 
“Pursuant to Article 1854 C.C.Q., the landlord is therefore bound to warrant the lessee that the property may be used for the purpose for which it was leased, the whole throughout the term of the lease. The landlord is responsible towards the lessee for the harm suffered which results from a hidden defect, even if the landlord was unaware of its existence…”
 
“Even if Avanti was unaware of the defect, I am of the opinion that it must indemnify its tenants pursuant to Article 1854 C.C.Q.”

In CGU v. Guindon, Madam Justice Sévigny agreed that the fire had been caused by an electrical defect.
 
The tenant’s only obligation was to prove that the leased property had had a defect and that this defect had caused the harm for which the tenant was seeking redress from the landlord.
 
As for the landlord, his only means of defence was to show “superior force” (1470 C.C.Q.)—that is, “an unforeseeable and irresistible event”—or the fault of a third party.
 
Madame Justice Sévigny ruled that evidence of this had not been provided.
 
Consequently, owners of residential buildings that have been leased to tenants, as well as their insurers, must be aware that the obligation created by Article 1854 C.C.Q. is an obligation of result likely to give rise to their liability in most cases. Indeed, proving superior force is always highly difficult, given the requirement to show that the event was “unforeseeable” and “irresistible.” As regards establishing the fault of a third party, the burden of proof may also be quite heavy.
 
Thus, insurers should protect themselves against this interpretation of Article 1854 C.C.Q. by carefully inspecting a building that is to be insured or by adjusting the premiums, as the case may be.

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[1] J.E. 2006-564
[2] We mentioned above that the second paragraph of Article 1854 C.C.Q. is compulsory in residential matters; thus, in commercial matters, this obligation can be avoided through the use of a disclaimer clause (Leblond v. Dionne et al, Court of Appeal, 2006 QCCA 341).
[3] [1996] JL 302
[4] [1996] JL 343
[5] REJB 1999-11966
[6] REJB 2002-37466
[7] It is interesting to note that, at the end of this sentence, Mr. Justice Mongeon refers to the judgment in Manolis v. Hébert rendered by the Régie du logement.
[8] 200-09-004471-030

This bulletin provides general comments on recent developments in the law. It does not constitute and should not be viewed as legal advice. No legal action should be taken on the basis of the information contained herein.

 

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