Can a municipal authority be liable for failing to properly inspect a building plan?

A local government is entitled to exercise its authority in a certain manner because of policy considerations, including budgetary concerns, without attracting liability: see Barratt v. North Vancouver (District) (1980), 1980 CanLII 219 (SCC), 114 D.L.R. (3d) 577, [1980] 2 S.C.R. 418, 14 C.C.L.T. 169. But if the municipal authority adopts a policy to maintain roadways, inspect building plans, or ensure compliance with building codes, and if there is a negligent failure on the part of its employees to implement the policy, then liability will arise. Where the policy is cast in terms of a by-law or ordinance, the purpose of which is to protect against economic loss, it should not come as a surprise that damages under this head are awarded. But these cases constitute a discrete classification and do not constitute a valid precedent to resolve claims by subsequent owners against the contractor at the time of construction, as in the D & F Estates case, or the present action.