Construction Law

The defendants brought a motion under Rule 21.01(1)(a) and Rule 20 to dismiss the plaintiff's action.

The action claimed against the defendants under the trust provisions of the Construction Lien Act for interest and costs, and was also challenged on the basis of a limitation period.

The court dismissed the motion, finding that the legal question of whether interest and costs are covered by the CLA trust was unsettled and required a full factual record at trial.

Similarly, on the limitations issue, the court determined there was a genuine issue requiring trial, particularly concerning the "appropriate means" element of discoverability under the Limitations Act, 2002.

A subcontractor filed a construction lien arising from specialized grouting and monitoring work performed in connection with the Toronto-York subway extension beneath a university building.

The general contractor moved to discharge the lien, arguing the work occurred on a railway right-of-way and that the university was not an “owner” under the Construction Lien Act.

The court rejected these arguments, holding the university qualified as an owner because the work was requested, controlled, and directly benefitted its property.

The lien was therefore validly preserved by registration on title.

The court also held that the subcontract’s broad arbitration clause required the underlying payment dispute to proceed to arbitration and stayed the lien action while refusing to add the transit authority as a third party.

The plaintiffs brought a motion relating to the implementation and costs of a court-ordered construction project designed to remedy drainage and property impacts caused by alterations to neighbouring land.

The court reviewed affidavits from engineers addressing cost increases associated with implementing the approved design plan.

It accepted evidence that increased costs arose primarily from unforeseen soil conditions and confirmed that construction costs had been properly segregated from litigation costs as previously ordered.

The court found that the plaintiffs had demonstrated the reasons for the cost overruns and that the project had been completed despite interference by the defendant.

The motion was granted as requested, with payment directed to be held in trust for the contractor and engineer.

A homeowner brought an action against a contractor arising from a kitchen renovation project involving multiple unclear written and unwritten agreements.

The plaintiff alleged numerous deficiencies including an uneven floor, improperly installed cabinets, lack of structural roof support after removal of ceiling joists, and ventilation deficiencies.

The court found that the contractor breached aspects of the contract and performed some work negligently, including failing to provide structural support compliant with the Building Code.

However, the plaintiff failed to prove the cost of rectifying most alleged deficiencies, which is required to establish damages absent rescission.

Judgment was granted only for the return of a $5,600 window deposit that was paid but for which no windows were supplied or installed.

The plaintiff brought a pre-trial motion seeking to amend pleadings in two consolidated construction-related actions originally commenced in Small Claims Court.

The requested amendments included increasing the monetary claims above the former Small Claims Court jurisdictional limit, correcting a bond number, asserting rights under a labour and material bond, and adding claims for relief from forfeiture under the Courts of Justice Act and the Insurance Act.

The court held that increasing the quantum of damages already claimed did not constitute a new cause of action and allowed the amendments raising the amounts claimed.

However, the court refused amendments introducing a claim under a labour and material bond where the original pleadings relied on an incorrect performance bond, finding this would introduce a new and statute-barred claim causing presumed prejudice.

The court also rejected the proposed amendments seeking relief from forfeiture because the plaintiff had failed to comply with condition precedent notice requirements and its conduct in delaying the amendment was unreasonable.

A subcontractor obtained judgment against a corporate officer for breach of trust under the Construction Lien Act after the officer’s defence was struck for failing to provide ordered financial disclosure.

Unknown to the creditor, the officer had earlier assigned himself into bankruptcy and later sought to have the creditor’s writ withdrawn following his discharge.

The creditor moved for leave nunc pro tunc under s. 69.4 of the Bankruptcy and Insolvency Act to continue the action notwithstanding the bankruptcy, arguing the debt arose from breach of fiduciary trust and would survive discharge under s. 178(1)(d).

The court held that the creditor’s failure to obtain prior leave was merely an irregularity caused by lack of notice of the bankruptcy.

Leave was granted nunc pro tunc and the judgment debt was declared to survive the discharge.

Following dismissal of a negligence action for delay under Rule 48.14 of the Rules of Civil Procedure, the court addressed costs of the action.

The defendants sought costs, with some requesting substantial indemnity and the municipality requesting partial indemnity.

The court held that substantial indemnity was not justified in the absence of a Rule 49 offer or conduct warranting punitive costs.

Applying s. 131(1) of the Courts of Justice Act and Rule 57.01, the court awarded costs to the defendants on a partial indemnity basis, reducing the municipality’s claim due to disproportionate time spent compared with other parties.

The plaintiff subcontractor moved for partial summary judgment against the contractor for funds received from the Ministry of Transportation under a highway paving project.

The contractor had admitted in its pleadings that, after specified deductions, $297,710.82 from a $450,000 payment was owed to the plaintiff but later sought to withhold payment pending determination of counterclaims and other related proceedings.

Applying the summary judgment framework and the “full appreciation test” from Combined Air Mechanical Services Inc. v. Flesch, the court held the issue was document‑driven and that the admissions in the pleadings established the debt.

The defendant failed to demonstrate a genuine issue requiring a trial and had not properly pleaded a set‑off.

Partial summary judgment was granted for the admitted amount with prejudgment interest, while the request to have additional funds paid into court was denied.

The defendants brought a motion for summary judgment dismissing a collection action as statute-barred under the Limitations Act, 2002.

The plaintiff sought recovery of approximately $62,000 for construction work performed in 2006–2007 but did not commence the action until 2012.

The plaintiff argued that promissory estoppel prevented reliance on the limitation defence and that a breach of trust claim under the Construction Lien Act was only discovered in 2011.

The court held that the claim for breach of contract was discovered by August 2008 at the latest and that there was no written acknowledgment of liability sufficient to restart the limitation period or support promissory estoppel.

The court further held that the breach of trust claim was discoverable at the same time as the breach of contract through reasonable diligence, rendering the entire action statute-barred.

A homeowner brought a Small Claims Court action against a roofing contractor alleging defective roofing work and seeking recovery of the full cost of the roof or the cost to replace it entirely.

The court found that the underlying structural issue of sagging plywood between roof trusses pre‑existed the contractor’s work and contributed to the roof’s uneven appearance.

However, the contractor was partially liable for shortcomings including failing to install the agreed number of vents, installing insufficient ridge venting, and failing to adequately address problems on a specific rear section of the roof.

The plaintiff failed to prove that the entire roof required replacement.

The court awarded partial damages based on a reasonable estimate of the cost to repair the affected section.

A construction contractor brought a motion seeking to stay its own court action so that the parties’ dispute over project delays and asbestos-related issues could proceed under the arbitration provisions contained in a CCDC-2 construction contract.

The defendant argued the motion was brought too late and that the contractual dispute resolution process had been discharged.

The court held that although s. 7 of the Arbitration Act, 1991 did not apply because the moving party had commenced the action, the court retained authority under s. 106 of the Courts of Justice Act to stay the proceeding.

Given the strong policy favouring arbitration and the parties’ contractual agreement to resolve disputes through the contract’s dispute resolution process culminating in arbitration, the court exercised its discretion to stay the action.

Issues regarding delay or compliance with contractual timelines were matters for the arbitrator.

Following a motion concerning a construction lien priority dispute, the court determined the issue of costs between the parties.

The responding party was the successful party on the only issue in dispute and relied on a Rule 49 offer to seek partial indemnity costs to the date of the offer and substantial indemnity costs thereafter.

The moving party argued it should receive costs because the responding party conceded a minor adjustment to the holdback amount prior to the hearing.

The court rejected that argument, holding the concession did not justify depriving the successful party of costs.

Applying the factors governing costs assessment, including those articulated in Boucher v. Public Accountants Council for the Province of Ontario, the court fixed costs at $17,300 inclusive of disbursements and taxes.

The defendant Crown brought a motion for partial summary judgment seeking dismissal of claims advanced by a general contractor on behalf of subcontractors arising from delays in a federal construction project.

The Crown argued that the subcontractors lacked privity of contract with the owner, that the contractor had not itself suffered damages, and that the claims were barred by limitation periods and lack of contractual notice.

The court held that the contractual scheme contemplated subcontracting and permitted the contractor to pursue delay damages that included sums payable to subcontractors where liability rested with the owner.

The absence of direct contractual privity between subcontractors and the owner was not a bar where the contractor’s contract allowed recovery of such costs and the subcontract conditioned payment on recovery from the owner.

The court concluded that the subcontractor claims raised a reasonable cause of action and that genuine issues required a trial.

The defendants brought a motion for summary judgment dismissing claims arising from the premature deterioration of pine roof shingles installed on the plaintiff’s home.

The plaintiff alleged breach of contractual warranty, breach of statutory warranties under the Sale of Goods Act, and negligent misrepresentation relating to representations that the roof would last 50 years.

The court found the plaintiff had discovered the alleged defects and the basis of her claims by November 2005, yet did not commence the action until March 2008.

Applying the two‑year limitation period under the Limitations Act, 2002, the court held the claims were statute‑barred.

The court also concluded there was no evidence the retailer provided a contractual warranty or representation guaranteeing the shingles for 50 years.

The defendants brought a motion in Small Claims Court to strike an amended plaintiff’s claim alleging negligent construction of an in-ground swimming pool.

The defendants argued the action was statute‑barred under the Limitations Act, 2002 because the plaintiffs allegedly discovered their loss in 2009 and commenced the claim outside the two‑year limitation period.

The court held that it was not clear on the pleadings when the claim was discovered, particularly given allegations that the defendants continued attempting to remedy the deficiencies through 2010.

Because it was possible that a proceeding was not yet an appropriate means to remedy the dispute during ongoing repair efforts, the limitation defence was not virtually certain to succeed.

The court declined to strike the claim and left the limitation issue to be determined at trial.

Following a construction lien trial involving landscaping services, the successful plaintiff sought costs exceeding $100,000 based largely on an offer to settle that it had bettered at trial.

The court considered Rule 49.10 of the Rules of Civil Procedure and the principles of fairness, reasonableness, and proportionality governing costs awards.

Although the plaintiff obtained judgment and had made a favourable settlement offer, the court found the claimed hours and total costs excessive relative to the amount recovered.

Taking into account the defendant’s unsuccessful counterclaim and litigation conduct but emphasizing proportionality, the court fixed costs at a reduced amount.

Following multiple related motions arising from construction disputes concerning steel connections at a university project, the court addressed the issue of costs.

The motions involved claims for summary judgment, limitation defences, dismissal of counterclaims, and issues under the Construction Lien Act.

The outcomes of the underlying motions were divided among the parties.

The court held that the mixed results and the procedural posture of overlapping claims justified denying costs to all parties.

A contractor brought a construction lien action against homeowners for unpaid invoices relating to electrical work performed on a newly constructed log home.

The homeowners argued the claim was unenforceable because the agreement was not in writing as required by the Consumer Protection Act, 2002, and counterclaimed for damages for alleged defective work.

The court held that although the oral agreement contravened the statutory requirement for a written future performance agreement, it would be inequitable to invalidate the contract under s. 93(2) because the work was substantially performed and the homeowners received benefit.

The contractor was not entitled to a materials markup, travel time charges, or reimbursement for newly purchased equipment, but otherwise proved entitlement to payment.

The counterclaim alleging defective work and damages was dismissed for lack of evidence.

A home builder sued purchasers for breach of a cost-plus construction contract after the defendants terminated the project before completion.

The defendants alleged breaches including cost overruns, delay, improper billing, and reliance on the Consumer Protection Act, 2002.

The court held the construction contract and the agreement of purchase and sale formed one integrated real estate transaction, rendering the Consumer Protection Act inapplicable.

The court found the defendants terminated the contract without cause and breached restrictive covenants requiring completion of construction within one year.

Damages were limited to unpaid invoiced work already performed, as the builder failed to prove lost profits from the abandoned project.

A contractor brought an action under the Construction Lien Act seeking payment for labour and materials supplied during residential renovation work.

The homeowner denied liability, alleging incomplete and deficient work and counterclaimed for overpayment and repair costs.

After reviewing conflicting evidence regarding the percentage of project completion and the quality of workmanship, the court found the project was approximately 40% complete and that the contractor had incurred material expenses on the homeowner’s behalf.

Although some deficiencies were established, most alleged defects reflected higher construction standards than those contemplated by the parties’ low-cost arrangement.

Judgment was granted for the contractor for the unpaid value of labour and materials less modest deductions for proven deficiencies.