PREFACE New to This Edition “This second Canadian edition has been updated and enhanced in the following respects * Case lw has been updated to include recent lading cate authority in several lds, inelude ing employment aw, tendering, pure economic oss, contract enforceability, dislaimes, and other areas, For example, the recent Supreme Court of Canads decisions in Tercon, Greater Fredericton Airport Authority, and Design Services are discussed and explained © ‘The most recent (2008) edition of the CCDC 2 Stipulated Price Contract has been included as an appendix. + The section on Quebec hus been expanded. The text contains anew scton discussing the relationship between law and ethics. About This Text “This text is intended to provide the following: 4) a broad overview of areasof the law relevant to the practice of architecture, engineering, and geoscience ’b) practical, rather than theoretical, information. ©) sufficient background to allow the reader to identity legal issues <4) simple, easy-to-follow larguage ‘This text is not intended to do the following: ) make lawyers out of and chereby ruin perfectly good architects, engineers, and geoscientists bb) bea master’s evel thesis on any ofthe subjects, since most if not all ofthe topics have le full-length texts written about them ©) eliminate the need to seck appropriate legal advice “The tite ofthis texts Praatal Law of Architecture, Pngincering, and Geoscience. Since the publica- tion of the first edition this practical guide to the law for design professionals has been adopted as the primary text forthe Professions Practice Exams and the entrance exam for Professional Engineers and ‘Geoscientists in various provinces. However, te intended audience ofthis text isnot limited to archi- tects, engineers, and geoscientiss, Contractor, technicians and technologists, lawyers, suppliers, project, ‘managers, construction manages, software professionals, and others also may benefit from reading it. ‘One ofthe rss of creating ater that provides abroad overview is that the explanations in most areas ae necesaily brief and do not contain the level of deal that would be found in comprehensive legal texts Therefore, readers must rxognize that this text i not intended asa substitute for legal advice. Legal problems are fctspecifc, meaning that a slight change inthe facts often can lea oa different conclusion. Purthermore; the aw difers From one jurisdiction to another and changes overtime. Non-lawyers should ‘obtain specific advice for specific egal problems and should not attempt to ac as their ov counsel thas been ssid that ignorance of the law i no excuse! The time has passed when archi- tects, engineers, and geoscienists could rely on technical competence in their fckds and ignore ‘iene un buve snd hats nomen doa no appre wal out judg, who have court of appeal us tacos he ers she lew. For thee profesional, the lelinood of being imahed in a lw AP gendan, is much greater aow than inthe pas. Since the cost of pros 2 ing eims can high rcograingaeprevening potential kg problemas i ponesional need to know thebases of contact ws thst they can pega ‘Many chapters n this tet apply equally t all profession. For example ‘ofcontact law and negligence, an property law snd busines organisation Sranectre as they are to engineering and geoscience. However, ether por BE inore useful to some professions than to others, For example, geonciem Faniulratetion to ection 1.5 on geoscence agreements and to Chapter Jclosure requirements for proesionsls involved in mining and oi ang gas Supplements Practical Law of Architecture, Eginering, and Geoscience, Second Canad tied by complete supplements package: + tnsrvtor’s Manual: The instructor's Manual features answers oF notes sins in the textbook, brie ease summaries, teaching suggestions, and for discussion along with suggested answers. + Tea em File: comprehensive testbank of various types of questions h Word o accompany this Canadian edition. + PonerPoint Slides lectonic sides are available in Microsoft PowerPo ‘iluminate and build on key concepts inthe text. The Instructor's Manual, Tes Item File, and PowerPoint? Slides ean be dowr Canad online catalogue at Hp vig pearsoned.a © Companion Website: racial Law of Architecture, Engineering and Gecsien Edition, is supported by an exellent Companion Website that canbe acces that came package with his book. The Companion Website includes prac terms and concepts, sample conta and links to relevant websites. © CoureSnare CourseSmart goes beyond traional expcations-proviing ins the textbooks and course materia you nee a lower cst for students. Al ‘money, you can sve time aad hase wth gta eTextbook tha allows yout relevant content the very sorent you ned it Sec how when yu vst we instructors. Acknowledgments ‘The manuscript for this book wat reviewed st various stages of developr Academic and professional pers from acros Canada. We wish to thank th insight and constructive critcam ofthis manuscript. Dr. Michac! Bennett, University of Ontario Institue of Technology Ds. Mion W. Petruk, Associaton of Profesional Engineers, Geologists, and Ge Gilian Pichter, Assocation of Professional Engincers and Geoscientists of 8 Bryan S. Shapiro, University of British Columbia Jon Shepherd McKee, Univenty of Western Ontario _, At Pearson Canada, we zr grateful for the support and dedivatec effJa arn and Instruct Online I Website fs eany fo navigate and is organized to this textbook. Whether vos ive a student fn the yc wil discover help resources fr in-dapth er you Jn your quent for greater knowledge and cssh a the course. , Engineering, and Geoscience, Samuels and Sanders ules stadens can send answer tothe grader and receive instant Progress eraugh the Ress Reporter. Coaching comments 0 the textbook may be avalable o ensure that stents take 3 avable sources to enharce tel learring expetence, sues 925 edtonateshinytedsindting Power tden an nabctors tethonk through Pearson Card's one catalogue. Toget a pusword, yur Pearson Ca ada Representative or cl Fact Sales ond Serves at CHAPTER 1 THE CANADIAN LEGAL SYSTEM 11 The Canadian Constitution In Canada asin many counties, the abit to create and enforce the law is derived from the Constitution. The ‘Constitution ithe source of al egl authosity in Canada. The Constitution is made up of several statutes and '© contracts sometimes fil to fully perform all their ‘obligations. This failure constitutes @ breach of the Many of these conditions apply: Snail of one party opeform the contrac enceInterpreting ond Del CHAPTER 8 Canons of Contract Construction fas of contract construction are not rules of law; they are simply principles employe to assist in determining the objective intention of the parties. [AND ORDINARY MEANING The golden rule of contract interpretation isthe fa contract should be construed in their grammatical and ordinary sense an shou sei plain and ordinary meaning, except tothe extent that interpretation or modific in order to avoid absurdity, inconsistency, or repugnancy. Therefore, in the abser iy, the natural or literal meaning ofthe words set out in the contract shouldbe edop SPECIALMEANING Where words have a customary or special meaning, a often occurs jeal documents in construction contracts, the special meaning takes the place ofthe ord ning fr the purpose of construing the contrac. Use ofa dictionary is appropriate for ¢ ing the special meaning of words, as is use of contractual headings and marginal notatior cases, expert evidence is required. "READING THE CONTRACT AS A WHOLE Courts consider each contract as a whol 2, each cleuse should be considered notin isolation but in the context of the whole contre 1. If there is a conflict between two parts of a document such that both clauses cann the interpretation that reflects the true intentions ofthe parties is adopted. GIVING EFFECT TO ALL PARTS OF ACONTRACT In interpreting a contract, a court wil x: to all parts wherever possible. In other words, no part of the contract should be treat tive, surplus, or meaningless. RESTRICTION BY EXPRESS PROVISIONS Standard form contracts often have added | dard form special or supplemental conditions. In these circumstances, courts assign sce to the special conditions: and in the case of conflict between the general cond d the special conditions, the special conditions preva INTERPRETING AND DRAFTING CONTRACTS 8.1 Interpretation When a court interprets a contrac, i ascertains the meaning of the words used by the contracting parties and termines the legal effect of those words. Interpretation of contracts involves the application of many legal pring ‘= the overriding principle ofthe objective intention ofthe parties, 1 the canons of contract construction; and the introduction of ad Sexxl evidence. COMMERCIAL PURPOSE Courts interpret commercial agreements to reflect the most cally reasonable result and the most commonly accepted busines principles, unless th ‘The role of the court in interpreting a contract is not to rewrite the contract forthe parties nor to leary precludes this approach, The courts do not imply terms unless they are neces contract where the partis failed o form a valid one themselves. [the literal meaning of the contracts | 3 then there is no room lft for interpretation. However, where the contract contains clauses that are ambi pe te inten ofthe ports. ‘of uncertain, the court must analyze and interpret the contract to determine its legal meaning. In some cl ) CONTEXT The courts determine word meanings by their context. They donot int the court may also allow the introduction of additional evidence to assist in interpretation, ds general words tobe as broad of general s they appear in isolation, but instead assign bused on the context in which they are used. (a) The Intention of i * pline cerns . CONTRA PROFERENTEM Contra proferentem i a Latin phrase meaning that where 3c principal and overriding objective in conteact interpretation isto ascertain the reasonable mutual ts ambigues and there are ero alerts interpretation, the courts choos the aterpre ns of the parties regarding the legal obligations they assumed uncer the written contract. During Src parry shat ld gor yeite AE aoa interpretation, the court is said to apply an objective standard, which requires determining what hypothet Pant reasonable partes would have intended. The objective standard contrasts with the subjective standards wt involves determining what the actual partis themselves intended, In a contract digpute, the cour is inter {in the objective intentions ofthe partis. In this manner, the way in which the contact language would appear tothe ordinary reasonable person looking ati rom outside However, determining the objective intention of the parties does not confine the interpreter to Jol "Preation, stretly atthe contract itself. An interpreter may use the canons of contact construction and the co conte a guidelinesCHAPTER 9 pt 9-1 Actuland Apparent Authority SELECTED CONTRACT ISSUES Even in the absence of any agreement between the principal and the agen rit ‘to the third party that the agent has authority creates apparet . Infact, implied authority maybe ceaed simply by the principal's ape Overview rincpel knows that the agent is exccedng his or her authority bot docs not ‘Contract isues are at the heart of many dspace, Certain sues occur relatively rarely, such asthe incapac that may expand the scope of apparent authority. ‘tthe periesto contact or inpoibiy ef peroraaner. Other tnenecurfequey Withee Astsratd bythe above extra rom the CCDC 2 document ot al issues—agency, indemnities, change orders, subcontracts, unforeseen conditions, specifications, and. Bleep sean sy be authorized to do only certein ace oc cney be aubociog “Ainisatog tht or the sujet ofthis chaper tranaction on behalf of the principal. In edition, the grentofeuthoriy io me j, such as the right ea onde th : Principal must make these limits known to the thied ary: otherw 9.1 Agency and Authority und ifthe agent exceeds the limits of actual authority but is within the appar An agent ia person authorized to act on behalf of another party known a the principal. The agency Ieitheracsual authority or apparent authority exists, the principal is bou ip is essential to virtually all projects. There are three parties to an agency relationship: the principal, the St ontract amendment negotiated by the agent. Both types of authority don’t F and the thtd party. For example ina construction context, the owner is the principal, te architect or ‘An agent owes a duty o actin the principal’ best interest. However, not © isthe agent, ond the contractor isthe third arty, * constant i performed asan agent. The consultant must act impartial in: The principal can provide authority to the agent in one of twa ways: express authority or apparent au Providing reports and reporting findings. The consultant must always be ity, Express authority, cometimes called actual authority, is often created by a contract (which may oF may ® being performed requites impartiality or must be done in the best intrest 0 'be written) between the principal and the agent. For exemple, en agreement for design services between ey NOt that staternent by the agent that he o she es authority is not sic ‘owner and architet should define the limits ofthe architect's authority to bind, or make agreements on thority. The following statement from the case of Pac National Leasin ‘of, the owner. Any change authorized by the architect that fits within the express authority is binding on t ‘Ltd. contains a concise explanation of this prt ‘owner, even ifthe owner does not like the change Tha Apparent authority, sometimes called ostensible authority or implied authority, is created by representati gener rfpence to Breen! and Royale o& AM aoe (eg, statements) made by the principal to the third party (see Figure 9-1). The contract between the owner: Where a perton, by words or conduc, represents or permits it to be repres the contractor almost always contains such representations. The CCDC 2 standard form construction con Another person has authority to act on his behalf, he is bound by the a