Construction Law

The defendant was substantially successful on a motion to discharge the plaintiff's construction lien and dismiss the primary causes of action.

The defendant sought substantial indemnity costs of $31,817.06, arguing a pre-motion letter constituted an offer to settle.

The court found the letter was merely a demand, not an offer to settle, and awarded partial indemnity costs.

After considering the divided success on some arguments and the complexity of the motion, the court fixed costs payable by the plaintiff to the defendant at $20,000 inclusive of HST and disbursements.

The applicant sought the appointment of an arbitrator under a construction agreement.

The respondent cross-applied for a declaration that the arbitration was barred by the Limitations Act, 2002, and that procedural preconditions were not met.

The court granted the application to appoint an arbitrator and dismissed the cross-application, holding that under the competence-competence principle and the 'hands-off' approach to arbitration, the arbitrator should determine their own jurisdiction and the limitation period defence.

The applicant sought leave to appeal an arbitrator's award that dismissed its claim for $19.7 million and allowed the respondent's counterclaim for $1,048,351.93 arising from a terminated construction contract.

The applicant alleged the arbitrator made 524 categorical errors of law in interpreting the contract.

The court dismissed the application, finding that the alleged errors were questions of mixed fact and law regarding the arbitrator's use of the factual matrix and subsequent conduct to determine if the contract was breached, and that the applicant failed to identify any extricable errors of pure law.

The applicant sought leave to bring an application for judicial review of an adjudicator's interim determination under the Construction Act, which ordered him to pay the respondent contractor $119,314.

The applicant argued the adjudicator lacked jurisdiction because the contract had been terminated and thus 'ceased to exist', and that the adjudication conflicted with an existing lien action where security had been posted.

The Superior Court of Justice dismissed the motion, finding that a terminated contract does not 'cease to exist' for the purposes of the Act, the jurisdictional issue was not raised before the adjudicator, and the Act expressly permits concurrent adjudication and lien proceedings.

The defendants brought a motion for summary judgment to dismiss the plaintiffs' action regarding a collapsed hog barn, arguing it was barred by the 15-year ultimate limitation period under the Limitations Act, 2002.

The plaintiffs argued the limitation period was tolled due to the defendants' wilful concealment of construction deficiencies.

The court found a genuine issue requiring a trial regarding the fraudulent concealment exception for the corporate defendants and dismissed their motion.

However, the court granted summary judgment dismissing the action against the individual engineer defendants, finding they were protected by a limitation of liability clause in their employer's contract.

Following a trial where the plaintiff successfully proved a construction lien and defeated the defendants' counterclaim, the court determined the costs and interest payable.

The plaintiff sought substantial indemnity costs of $225,504.45, while the defendants argued for $85,000.

The court awarded the plaintiff $175,000 in substantial indemnity costs, citing the defendants' unreasonable conduct, misleading evidence, and failure to accept multiple generous offers to settle.

The court also awarded prejudgment interest at the contractual rate of 25%.

The parties brought a statutory appeal and cross-appeal from an arbitrator's award under the Ontario New Home Warranties Plan Act regarding a new build home purchase agreement.

The Divisional Court directed the parties to address whether leave to appeal was required as a preliminary issue.

The court held that while it has jurisdiction to hear the appeal, section 45(1) of the Arbitration Act applies because the Tarion Addendum constitutes an arbitration agreement that is silent on appeal rights.

Consequently, leave to appeal is required and the appeal is strictly limited to questions of law.

The plaintiff brought a motion to declare that a default judgment debt owed by the defendant survived his assignment into bankruptcy pursuant to s. 178(1)(d) of the Bankruptcy and Insolvency Act.

The underlying action involved a breach of trust under the Construction Act for failing to pay for construction materials.

The court held that the defendant's extrinsic evidence attempting to explain the breach of trust was inadmissible on a Rule 59.06(2) motion.

The court found that the deemed admissions from the default judgment established misappropriation while acting in a fiduciary capacity, and therefore the debt survived the bankruptcy.

The applicant law firm sought an interpleader order regarding $83,831.83 held in its trust account.

The funds were originally part of an escrow agreement related to construction liens.

After the liens were settled, a judgment creditor of one of the contractors served a notice of garnishment on the applicant.

Both the property owner and the judgment creditor claimed entitlement to the funds.

The court granted the interpleader order on consent, allowing the applicant to pay the disputed funds into court as it claimed no beneficial interest and faced competing claims.

The defendant owner moved under s. 44(2) of the Construction Act to vacate a $2.14 million construction lien by paying a reduced amount into court.

The plaintiff contractor opposed and cross-moved for leave to register a certificate of pending litigation (CPL).

The court allowed the defendant's motion, finding that the plaintiff's claims for contractual interest and delay damages were not lienable, and set the security amount at $1,046,647.52 based on the plaintiff's admissions.

The cross-motion for a CPL was dismissed because the Construction Act provides a complete code for lien claims, conferring no separate interest in land, and the plaintiff failed to include a claim for a CPL in its statement of claim.

The defendants brought a motion to set aside a noting in default and default judgment entered against them in a construction lien dispute.

The court found that the motion was brought without delay, there was an adequate explanation for the default (including travel abroad, language barriers, and a COVID-19 hospitalization), and there was an arguable defence on the merits.

The court concluded that the interests of justice favoured setting aside the default judgment, noting that the plaintiff was protected by funds already paid into court.

The plaintiff electrical subcontractor moved for default judgment against the defendant general contractors in a construction lien action.

The homeowner defendants, who had also been noted in default, appeared and requested that the noting of default against them be set aside, arguing they had disputed liability early on but were ignored.

The court declined to grant default judgment against the general contractors immediately, as doing so would prejudice the homeowners' ability to dispute the quantum.

The motion was adjourned to allow the homeowners to bring a formal motion to set aside the noting of default.

The applicants, a consortium of construction companies building the Eglinton Crosstown LRT, sought declarations that the COVID-19 pandemic constituted an Emergency under their Project Agreement, entitling them to a Variation Enquiry for an extension of the Substantial Completion Date.

The respondents moved to stay the application, arguing the contract required all litigation to be deferred until after Substantial Completion.

The court dismissed the motion for a stay, finding it would cause irreparable harm by depriving the applicants of their contractual right to seek an extension.

The court granted the declarations, holding that the pandemic was an Emergency and that the respondents had required the applicants to implement additional or overriding procedures (social distancing), thereby triggering the Variation Enquiry process.

The moving party contractor sought to declare two construction liens preserved by the responding party sub-subcontractor as expired.

The central issue was the interpretation of the transition provisions in s. 87.3 of the Construction Act, specifically whether the former 45-day or current 60-day lien preservation period applied when the prime contract was entered into before July 1, 2018, but the subcontracts were entered into after.

The court held that the legislative scheme applies consistently to all persons involved in the same improvement based on the date of the prime contract.

Consequently, the former 45-day period applied, the liens were declared expired, and the posted security was ordered returned.

The plaintiff brought a motion for summary judgment in an action for debt collection and breach of trust under the Construction Act.

Due to pandemic-related delays in exchanging records, the parties consented to convert the matter into a two-day summary trial.

The court scheduled the summary trial, directed the parties to a pre-trial conference, and exempted the action from mandatory mediation.

The plaintiffs brought a motion to strike the defendants' statement of defence and dismiss their counterclaim for failing to comply with previous court orders regarding undertakings and appointing legal counsel for the corporate defendant.

The court dismissed the motion to strike, finding that the defendants had not shown a wanton disregard for the rules, noting that the COVID-19 pandemic and financial hardship caused the delays.

Instead, the court granted lesser remedies, including allowing the individual defendant to represent the corporate defendant and ordering third-party disclosure to satisfy the outstanding undertakings.

The plaintiff supplier brought a motion for summary judgment against the owner and the principal of the contractor for unpaid invoices.

The contractor had terminated its contract with the owner, and the owner signed a termination agreement promising to pay the contractor's outstanding obligations to specific suppliers, including the plaintiff.

The court found that the owner was directly liable to the plaintiff under the principled exception to the privity of contract doctrine.

The court also found that the principal's personal guarantee was not released because the release was contingent on the owner paying the invoices.

Summary judgment was granted against the owner and the principal.

The defendants, engineering consultants, brought a motion for summary judgment to dismiss a crossclaim by the co-defendant developer.

The crossclaim was a subrogated claim advanced by the developer's insurer.

The moving parties argued they were additional insureds under the developer's wrap-up liability policy and thus protected by a waiver of subrogation clause.

The developer argued the waiver should not apply because the moving parties' professional services were excluded from coverage under the policy.

The court held that the moving parties were additional insureds and the clear language of the policy's waiver of subrogation clause applied, regardless of the professional services exclusion.

The motion for summary judgment was granted and the crossclaim was dismissed.

The plaintiff was largely successful at a three-week construction lien trial, recovering $143,787.65.

The plaintiff sought costs on a substantial indemnity basis, relying on three offers to settle that were all beaten at trial.

The court awarded the plaintiff $180,739.70 in all-inclusive costs, finding that the defendants unreasonably resisted the claim and that proportionality should not be rigidly applied to undercompensate a successful party facing an unmeritorious defence.

The court also awarded pre-judgment and post-judgment interest at the contractual rate of 12% calculated daily on the lien-able portion of the judgment, and at the Courts of Justice Act rate on the damages for breach of contract.

The plaintiffs obtained a Mareva injunction after advancing $139,000 to the defendants to rebuild their fire-destroyed home.

The plaintiffs alleged the defendants misappropriated the funds, performed no work, and submitted forged engineering plans to the municipality.

The defendants brought a motion to discharge the injunction, while the plaintiffs brought a motion for contempt.

The court dismissed the motion to discharge, finding a strong prima facie case of fraud and risk of dissipation of assets, but varied the order to allow the defendants to receive deposits and post security.

The contempt motion was adjourned pending cross-examinations.