Generally, a victim is bound to take appropriate measures to avoid or mitigate any prejudice suffered and resulting from the acts or behaviour of a faulty person. [cite: 1]<\/p>\n
The principle behind this rule is enacted at article 1479 of the Quebec Civil Code: [cite: 2]<\/p>\n
1479. A person who is bound to make reparation for an injury is not liable for any aggravation of the injury that the victim could have avoided. [cite: 2]<\/p>\n
This being said, a recent unanimous decision from the Quebec Court of Appeal, issued on April 16th, 2021, with the reasoning which reminded us of the application of this rule in a context where the plaintiff is claiming damages for lost of profits quantum evaluation for the damages that can be awarded. [cite: 3]<\/p>\n
The claim was in the context of a long term partnership project regarding the operation of a sugar shack which aborted after only a few months despite an agreement which was supposed to last for a much longer time. [cite: 4]<\/p>\n
At first instance, in January 2019, judge Claude Dallaire had condemned the defendant who was owner of the sugar shack, to pay over $320 000 to the plaintiff to cover the profits of which he had been deprived because of the defendant\u2019s decision not to proceed with their agreement concluded a few months beforehand. [cite: 5]<\/p>\n
Following the trial judgment, the defendant brought an appeal based on many aspects of the judgment from Judge Dallaire, but amongst others, based on the conclusion granting the defendant with damages for the profits that they would have made from the agreement ( i.e. , a lease of 15 years), because this conclusion did not adequately apply the rule deriving from Article 1479 Q.C.C. [cite: 6]<\/p>\n
In his reasoning, he used the words of Justice Dutil in her decision of 2014 in Lebel c. [cite: 7]<\/p>\n
9067-1959 Qu\u00e9bec inc . to summarize the \u00ab ins and outs \u00bb of this rule: [cite: 7, 8]<\/p>\n
\u00ab Des enseignements de la jurisprudence et de la doctrine, on peut conclure que l\u2019obligation de minimiser les dommages, \u00e9dict\u00e9e \u00e0 l\u2019article 1479 C.c.Q., poss\u00e8de les caract\u00e9ristiques suivantes :<\/p>\n
\u00bb [cite: 13]<\/p>\n
Justice Bachand kept going by summarizing another decision from 2008 from the Court of Appeal, which illustrated well the impact of the rule in a context of a claim for loss of profit as part of call for tenders, in the decision of 3051226 Canada inc. [cite: 13]<\/p>\n
c. A\u00e9roports de Montr\u00e9al. [cite: 14]<\/p>\n
In this decision the Appellate Court decided that the appellant was only allowed to received an amount for damages corresponding to one third of the profits that would have allegedly been made if the contract had been attributed to the them, representing about $400 000. [cite: 14]<\/p>\n
Initially, the parties had agreed to set to $1 200 000 the amount in profit that they would have made in the three months if the contract would have last. [cite: 14]<\/p>\n
However, considering that the trial judge had realised that the appellant did not take appropriate measures to mitigate its prejudice suffered, he granted only one third of the set damages, and this decision was maintained on appeal. [cite: 15]<\/p>\n
Justice Bachand was of the opinion that damages for the profits which would have materialized during the fifteen years that the lease was supposed to last was way too high, so the trial judge had committed an error on that level: [cite: 16]<\/p>\n
[16] Le probl\u00e8me tient essentiellement au fait que la juge a concentr\u00e9 son analyse de la capacit\u00e9 de l\u2019intim\u00e9e \u00e0 trouver une occasion d\u2019affaires comparable sur le court terme. [cite: 16]<\/p>\n
Bien qu\u2019elle ait conclu que l\u2019on ne pouvait reprocher \u00e0 l\u2019intim\u00e9e de ne pas avoir trouv\u00e9 \u2014 \u00ab dans les quelques ann\u00e9es suivant la fin de sa relation avec [l\u2019appelante], et avant l\u2019audition de sa cause \u00bb[7] \u2014 une occasion d\u2019affaires comparable, son jugement est muet sur les motifs pour lesquels l\u2019intim\u00e9e n\u2019aurait pas \u00e9t\u00e9 en mesure d\u2019\u00e9viter l\u2019aggravation de son pr\u00e9judice \u00e0 moyen et \u00e0 long terme. [cite: 17]<\/p>\n
Puisque, sur ce point, \u00ab la d\u00e9cision [de la] juge de premi\u00e8re instance ne suffit pas \u00e0 expliquer le r\u00e9sultat aux parties \u00bb[8], et puisque notre Cour \u00ab [ne] s\u2019estime [pas] en mesure de l\u2019expliquer \u00bb[9], cette omission constitue une erreur de droit. [cite: 18]<\/p>\n
[17] Il s\u2019agit de surcro\u00eet d\u2019une erreur qui, \u00e0 la r\u00e9flexion, s\u2019av\u00e8re d\u00e9terminante. [cite: 19]<\/p>\n
[18] Certes, l\u2019intim\u00e9e a raison de souligner qu\u2019il revient g\u00e9n\u00e9ralement \u00e0 la personne fautive de d\u00e9montrer non seulement que la victime a omis de prendre des mesures raisonnables en vue de minimiser son pr\u00e9judice, mais aussi que cette derni\u00e8re avait la possibilit\u00e9 de le minimiser[10]. [cite: 20]<\/p>\n
Il est \u00e9galement vrai que l\u2019appelante n\u2019a pas administr\u00e9 une preuve d\u00e9taill\u00e9e quant aux occasions d\u2019affaires qui \u00e9taient susceptibles de s\u2019offrir \u00e0 l\u2019intim\u00e9e durant les ann\u00e9es suivant l\u2019\u00e9chec du projet de partenariat. [cite: 21]<\/p>\n
[19] Toutefois, m\u00eame si l\u2019absence d\u2019une telle preuve pourra jouer en d\u00e9faveur de la personne fautive, elle ne lui sera pas n\u00e9cessairement fatale. [cite: 22]<\/p>\n
La raison tient au fait qu\u2019il est parfois possible d\u2019inf\u00e9rer du contexte d\u2019une affaire donn\u00e9e et des autres \u00e9l\u00e9ments de preuve au dossier que la personne fautive cessera de r\u00e9pondre de l\u2019aggravation du pr\u00e9judice subi par la victime \u00e0 partir d\u2019une certaine date[11]. [cite: 23]<\/p>\n
This last paragraph of Justice Bachand\u2019s reasoning is important as it highlights that the context surrounding the affair is important for the parties when quantifying the damages. [cite: 24]<\/p>\n
Understanding and considering the context of the case and the facts surrounding the parties allows the court to decide, by exercising its discretion, when exactly did the victim of the case start being responsible or liable of a portion of the prejudice suffered and claimed. [cite: 25]<\/p>\n
There is sometime a lack of evidence by the defendant of all the things that the plaintiff did not do and could have done to mitigate or avoid a part of the prejudice suffered and claimed. [cite: 26]<\/p>\n
But it is important to understand that a lack of evidence is not fatal in such a case, because the Court can then exercise its discretion to reduce the amount that should be awarded in damages to a more reasonable level. [cite: 27]<\/p>\n
As Justice Bachand said in his reasoning, the trial judge Dallaire had decided that the impossibility from the victim to reduce the prejudice suffered was a relative question, so simply limited by time. [cite: 28]<\/p>\n
Justice Bachand therefore set at three and a half years the period after which the victim became liable for the aggravation of the prejudice. [cite: 29]<\/p>\n
This therefore brough the amount of damage granted at trial for a period of 15 years down to a proportional amount for the period set at trial. [cite: 30]<\/p>\n
On this subject, let us note the authors Jobin and V\u00e9zina who opine that the obligation to mitigate damages is applicable on both contractual and civil liability cases, and it is based on the principles that debtors shall only compensate what is a direct and immediate result of the fault and that each party has an obligation of good faith in the performance of their obligations. [cite: 31]<\/p>\n
The Court will therefore use its discretion for a situation where a plaintiff is claiming a lost of profits as damages but stayed still while suffering the said damages claimed, and without making the slightest effort to find an alternative source of revenues when needed. [cite: 32]<\/p>\n
The burden of proof that the victim could have done something reasonable to avoid and mitigate damages lies on the defendant, but the Court has a discretionary power based on the context and the facts of the case to adjust the quantum of damages to award as a result. [cite: 33]<\/p>\n
The court\u2019s discretion to adjust damages claimed based on the plaintiff\/victim\u2019s actions is therefore very important to consider when analysing a file and advising a client. [cite: 34]<\/p>\n
For more information, please do not hesitate to contact me or one of my colleagues at Gascon & Associates. [cite: 35]<\/p>\n
By Frederic Savoie<\/p>\n","protected":false},"excerpt":{"rendered":"
Generally, a victim is bound to take appropriate measures to avoid or mitigate any prejudice suffered and resulting from the acts or behaviour of a faulty person. [cite: 1] The principle behind this rule is enacted at article 1479 of the Quebec Civil Code: [cite: 2] 1479. A person who is bound to make reparation […]<\/p>\n","protected":false},"author":1,"featured_media":13332,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[159,187],"tags":[],"class_list":["post-16098","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-law","category-litigation"],"acf":[],"_links":{"self":[{"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/posts\/16098","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/comments?post=16098"}],"version-history":[{"count":3,"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/posts\/16098\/revisions"}],"predecessor-version":[{"id":16811,"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/posts\/16098\/revisions\/16811"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/media\/13332"}],"wp:attachment":[{"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/media?parent=16098"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/categories?post=16098"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/gascon.ca\/en\/wp-json\/wp\/v2\/tags?post=16098"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}