Les J. O’Connor

This decision addresses the issue of costs and pre-judgment interest following a 29-day trial concerning a dispute over the construction of a luxury custom home.

The court's prior reasons (2023 ONSC 2015) found the owners (the Kriesers) breached contracts with the builder/landscaper (the GES defendants), dismissing the Kriesers' claims and awarding outstanding amounts to the GES defendants on their counterclaim.

The GES defendants sought substantial indemnity costs and pre-judgment interest.

The court fixed pre-judgment interest, reducing it for periods of delay attributable to the GES defendants and the COVID-19 pandemic.

For costs, the court awarded the GES defendants partial indemnity costs up to their Rule 49 Offer to Settle date (November 22, 2016) and then blended costs thereafter, reflecting their complete success in the action and counterclaim.

The court declined to award substantial indemnity costs throughout, finding the Kriesers' allegations did not warrant it, and made minor adjustments for costs related to mid-trial adjournments and new counsel familiarization.

The DIP Agent sought the appointment of a non-possessory Receiver and approval of a Sale Solicitation Process (SSP) for iSpan Systems LP, which had filed a Notice of Intention to Make a Proposal and subsequently defaulted on its Amended Proposal payments.

The motion also sought to suspend the Claims Adjudication Process and Mediation.

The court found the appointment of a receiver appropriate to maximize value for stakeholders, as bankruptcy would destroy much of the business's value.

The proposed SSP was approved, with the court deferring to the Receiver's recommendations on timeline and deposit amount, despite objections from two unsecured creditors regarding these terms.

The Claims Adjudication Process was also suspended.

The Kriesers sued Gregory Evan Seligman and his companies (G.E.S. Construction Limited, Greenstone Gardens Inc., etc.) for breach of contract, breach of fiduciary duty, breach of duty of good faith, punitive damages, trespass, and intimidation related to the construction of a luxury custom home.

The defendants counterclaimed for unpaid accounts.

The court found that the Kriesers breached the construction and landscaping contracts by failing to make timely and sufficient payments.

All claims brought by the Kriesers were dismissed, and the counterclaims by G.E.S. Construction Limited and Greenstone Gardens Inc. for outstanding amounts were granted.

The applicant, Donald Bodkin, moved for an order to convert his application into an action under Rule 38.10(1)(b) of the Rules of Civil Procedure, arguing that the case involved highly contested facts, credibility issues, and required processes inherent to an action like pleadings and examinations for discovery.

The respondents opposed the motion, citing the applicant's legal experience, potential limitation period issues, and alleged delay tactics.

The court found that the test for conversion was met due to significant material facts in dispute, complex issues requiring credibility assessment, and the necessity of a full discovery process.

The court exercised its discretion to grant the conversion, finding no uncompensable prejudice to the respondents.

The defendants, North American (Park Place) Corporation and North American (Park Place East) Corporation, brought a motion under s. 47(1) of the Construction Lien Act to dismiss the plaintiff M. Fuda Contracting Inc.'s construction lien action for delay and release the remaining security.

The court considered the four-year delay, the complexity of the case, the plaintiff's explanation, and the prejudice to the defendants.

While acknowledging the plaintiff's delay exceeded the presumptive two-year ceiling for lien actions, the court found the delay was partially explained by the case's complexity and a document dispute.

The prejudice to the defendants was attenuated by significant reductions in security and the existence of a companion slander of title action.

The motion to dismiss was denied, but the plaintiff was given a "last chance opportunity" to have the matter on the ready trial list by spring 2019, serve expert reports, and arrange a settlement conference by year-end.