• About
  • Offices
  • Careers
  • News
  • Students
  • Alumni
  • Payments
  • EN | FR
Background Image
Bennett Jones Logo
  • People
  • Expertise
  • Knowledge
  • Search
  • FR Menu
  • Search Mobile
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
View all
Practices
Corporate Litigation Regulatory Tax View all
Industries
Energy Infrastructure Mining Private Equity & Investment Funds View all
Advisory
Crisis & Risk Management Public Policy
View Client Work
International Experience
Insights News Events Subscribe
Arbitration Angle Artificial Intelligence Insights Business Law Talks Podcast Class Actions: Looking Forward Class Action Quick Takes
Economic Outlook New Energy Economy Series Quarterly Fintech Insights Quarterly M&A Insights Sustainability & the CIO
People
Offices
About
Practices
Industries
Advisory Services
Client Work
Insights
News
Events
Careers
Law Students
Alumni
Payments
Search
Subscribe

Stay informed on the latest business and legal insights and events.

LinkedIn LinkedIn Twitter Twitter Vimeo Vimeo
 

The Expansion and Contraction of Product Liability Causes of Action

April 22, 2022

Written By Ashley Paterson and Julien Sicco

Product liability case law in 2021 brought clarity to certain causes of action that often form the basis of product liability claims. In particular, Ontario courts considered new duty of care categories arising within the commonly pleaded negligence cause of action, and within claims for breach of express warranty and breach of the implied warranties that underlie consumer protection legislation. These decisions provide updated guidance in the context of both motions to strike and motions for certification. Manufacturers carrying on business in Canada
should be aware of these developments.

Negligence: The Duty Owed by Manufacturers of Inherently Dangerous Goods

In Price v Smith & Wesson Corp, the Ontario Superior Court of Justice determined on a preliminary motion to strike that gun manufacturers, and manufacturers of other inherently dangerous goods, may be responsible for the misuse of their products when feasible safety measures could have prevented harm.

This proposed class action arose out of the “Danforth Shooting” in Toronto, which involved a stolen Smith & Wesson handgun. Smith & Wesson argued that the Court should strike the plaintiffs’ negligence claims in part because Smith & Wesson did not owe the plaintiffs a duty of care under any recognized category of duty.

The Court declined to strike out the plaintiffs’ negligence claims after identifying two potentially applicable duty of care categories: (i) the “goods dangerous per se” category, under which
manufacturers of a good “dangerous in itself” owe a duty to those who necessarily come within the good’s proximity; and (ii) the modern “products liability” category, under which manufacturers of a good with a design defect owe a duty to those who are injured because of the defective good. The Court accepted that Smith & Wesson could be found to have failed to satisfy these duties by not making use of “authorized user technology” allowing handguns to be fired only when activated by an authorized user.

This decision could significantly affect the firearms industry in Canada, and may reverberate in other industries as well. But the decision, which was decided on a preliminary motion-to-strike standard, leaves open questions of whether independent criminal acts by a third party can affect liability, what precautions would satisfy these duties, and when a good is “dangerous in itself.”

Negligence: Clarifying Pure Economic Loss

The Ontario Superior Court of Justice’s 2021 decision in Carter v Ford Motor Company of Canada interpreted and applied the Supreme Court of Canada’s 2020 decision in 1688782 Ontario Inc v Maple Leaf Foods Inc, showing the limited scope of negligence claims for pure economic loss. Bennett Jones acted for Ford.

Claims for pure economic loss encompass claims for lost profits, reputational harm, and other economic injuries not accompanied by harm to person or property. In Carter, the plaintiffs alleged that certain Ford vehicles contained a water pump defect that created a propensity for dangerous engine failure after “moderate mileage.” A subclass sought to recover damages for the diminution in value of the defective vehicles.

Applying Maple Leaf Foods, the Court refused to certify the claim because the plaintiffs failed to plead an “imminent threat” of injury to person or property, instead pleading that the defect may arise “at some indeterminate time in the future,” which the Court characterized as a “danger … that may never be borne.” The Court also held that diminution in value would not be recoverable, since recovery in pure economic loss cases is limited to the costs of averting injury.

Carter emphasizes the limited scope of, and recovery in, negligence relating to pure economic loss, and will likely guide future courts in their interpretation of Maple Leaf Foods. Similar decisions in other Canadian jurisdictions will likely do the same. For example, in 0790482 B.C. Ltd v KBK No 11 Ventures Ltd, a British Columbia case, the unit-owning plaintiffs failed to recover the costs of repairing allegedly dangerous exterior windows in the ShangriLa Hotel because they did not plead a “real and substantial danger” to their property (i.e., their units). Looking ahead, Canadian courts will likely continue to explore the “imminent threat” and “real and substantial danger” requirements and further clarify what costs are required to avoid injury.

Warranty Claims

The Court in Carter also refused to certify the plaintiffs’ claims for breach of express warranty and breach of the implied warranties under consumer protection legislation across Canada, highlighting the difficulty of certifying those claims.

The breach of express warranty claim was found to be flawed because the plaintiffs sought to recover damages for alleged design defects that occurred outside the terms of the express warranty, rather than for defects in materials or workmanship that arose within the terms of the warranty. The breach of implied warranty claim was flawed because there was no privity of contract between Ford and the plaintiffs, since express warranties are contracts for the supply of services rather than goods.

The Court held that both types of warranty claims lacked commonality because of their inherent variability. In addition, the breach of implied warranty claims lacked commonality because of variable provincial legislative regimes.

Carter illustrates the challenges when seeking the certification of breach of warranty claims, whether due to inherent variability in those claims or the unwillingness of courts to expand express warranty protections beyond their terms or to work around privity requirements. Going forward, we expect that Canadian courts will continue to carefully scrutinize requests in class actions to certify warranty claims.

Other Articles In This Series

  • An Update on COVID-19 Class Actions in Canada
  • Diverging Approaches to the Certification of Class Actions
  • Navigating Multijurisdictional Class Actions
  • The Need to Prove Compensable Losses in Privacy Class Actions
  • Ontario and British Columbia Lead a Sequencing Culture Shift

Get the full Class Actions in Canada story

In our 2022 edition of Looking Forward, we review notable class action developments of the past year and consider what trends in the law might tell us about the year ahead.

Download Bennett Jones' Class Actions: Looking Forward 2022

Please note that this publication presents an overview of notable legal trends and related updates. It is intended for informational purposes and not as a replacement for detailed legal advice. If you need guidance tailored to your specific circumstances, please contact one of the authors to explore how we can help you navigate your legal needs.

For permission to republish this or any other publication, contact Amrita Kochhar at kochhara@bennettjones.com.

Class Actions: Looking Forward 2022

Read the Series

Key Contacts

  • Ashley L. Paterson Ashley L. Paterson, Partner
  • Julien  Sicco Julien Sicco, Associate

Related Links

  • Insights
  • Media
  • Subscribe

Related Expertise

  • Class Action Litigation

Recent Posts

Speaking Engagements

Insights on Tariff Strategy and Cross-Border Trade Compliance

May 08, 2025
       

In The News

John Manley on NPR’s Morning Edition on Mark Carney’s White House Visit

May 06, 2025
       

Speaking Engagements

Brendan Sigalet on Clean Investment Tax Credits

May 05, 2025
       

Speaking Engagements

Due Diligence for Tenants at ICSC CANADIAN LAW

May 02, 2025
       

Announcements

Bennett Jones Lawyers Named Among Canada’s Top Litigators By Benchmark Canada

May 01, 2025
       

Announcements

Twenty-Six Bennett Jones Lawyers Ranked in Lexpert's Special Edition on Infrastructure

April 30, 2025
       

Announcements

Jesslyn Maurier Appointed to Ontario Chamber of Commerce’s Board of Directors

April 29, 2025
       

In The News

John Manley Speaks With BNN Bloomberg on Business Implications of a Minority Government

April 29, 2025
       

Speaking Engagements

Ontario Bar Association: Insights on Employee Ownership Trusts

April 29, 2025
       
Bennett Jones Centennial Footer
Bennett Jones Centennial Footer
About
  • Leadership
  • Diversity
  • Community
  • Innovation
  • Security
Offices
  • Calgary
  • Edmonton
  • Montréal
  • Ottawa
  • Toronto
  • Vancouver
  • New York
Connect
  • Insights
  • News
  • Events
  • Careers
  • Students
  • Alumni
Subscribe

Stay informed on the latest business and legal insights and events.

LinkedIn LinkedIn Twitter Twitter Vimeo Vimeo
© Bennett Jones LLP 2025. All rights reserved.
  • Privacy Policy
  • Disclaimer
  • Terms of Use
Logo Bennett Jones