Jérémie Lachance

Scott Steel Erectors Inc. (SSE) brought a motion for the payout of statutory holdbacks retained by Ausenco Engineering Canada Inc. and for a stay of the proceedings in favour of arbitration.

The parties were involved in a construction project at the Magino Mine.

Ausenco argued that its holdback obligations ended when it posted alternate security to vacate the liens and that it had set-off claims against SSE.

The court found that the holdback was a statutory obligation that was not eliminated by posting a bond, and that set-off claims could not be deducted from the holdback.

The court ordered Ausenco to pay the principal holdback amount of $1,629,242.92 to SSE and $78,826.45 into court for another subcontractor.

The court also granted the stay, finding that the subcontracts contained mandatory arbitration clauses and that SSE had not waived its right to arbitrate by taking defensive steps to preserve its lien rights.

This decision concerns a motion by Ausenco Engineering Canada Inc. to discharge or reduce a construction lien registered by Scott Steel Erectors Inc. in relation to the Magino Gold Mine project.

The court addresses whether Scott Steel could register a lien for work performed under multiple subcontracts, including work by a related entity, Scott Concrete Services Inc., and whether the lien was willfully exaggerated by the inclusion of delay damages.

The court finds that there is a triable issue regarding the application of promissory estoppel and the treatment of the subcontracts "as one" but holds that there is no triable issue as to delay damages under certain subcontracts.

The lien is reduced to $23,670,377.46 plus HST.

The moving parties brought a motion to extend the time to bring a motion for leave to appeal from a decision of Chalmers J. dated June 28, 2021, and for leave to appeal.

The Divisional Court granted the extension of time but dismissed the motion for leave to appeal, awarding costs of $5,000 to the responding party.