Nicole Maragna

The defendant 35 Mercer Limited brought a motion to reduce the construction lien of the plaintiff Urban Electrical Contractors (UEC) by $4,333,708.96.

Prior to the hearing, Mercer, UEC, and Urban Integrated Group Inc. (UIG) settled the motion on terms reducing UEC's lien security by $3,231,464.75.

Subsequently, Mercer and UEC reached a separate settlement to fully discharge UEC's lien and return all security.

However, UIG opposed the full return of security because UIG's own liens had been vacated with reduced security that accounted for UEC's lien security already posted.

The court held that security for one lien cannot be returned without considering other lien claimants affected by that return, and ordered reduction only to the extent of UIG's consent.

The court also declined to award costs, finding the parties had settled the motion without judicial intervention on the merits.

This decision concerns the interim distribution of the admitted basic holdback under the Construction Act in a complex construction lien reference.

The court fixes the minimum basic holdback obligation of 35 Mercer Limited and orders pro rata payment to certain validated lien claimants, while holding the balance pending further determination of disputed liens, particularly that of 1086289 Ontario Inc. o/a Urban Electrical Contractors.

The ruling addresses the allocation of holdback among multiple classes of lien claimants and the treatment of disputed and unproven liens.

The defendant, 485 Logan Developments Inc., brought a motion under section 44(5)(b) of the Construction Act to reduce the security it posted for a claim for lien registered by the plaintiff, Maple Drywall Inc., relating to a stacked condominium project.

The court found a genuine issue of fact as to whether an "overage" amount was part of the contract price and thus properly included in the lien, but determined that 30% of the overage was not owed, requiring a reduction in posted security.

The court also awarded damages to Logan for excessive interest paid on the lien bond and partial indemnity costs to Maple, reflecting the parties' relative success and conduct.

Insite Construction Management Inc. (applicant) brought a motion to compel Ambient Mechanical Ltd. (respondent) to serve a further and better affidavit of documents, arguing that Ambient had refused to produce documents relevant to project costing in a lien action.

Ambient contended that all relevant documents had been disclosed, the requested documents were irrelevant based on the pleadings, and the request was overly broad.

The court dismissed Insite's motion, finding that the project costs were not relevant given the current pleadings, which primarily focused on whether Insite performed any work at all.

The dismissal was without prejudice, allowing Insite to revisit the production request if relevance is established through examinations for discovery.

Ambient was awarded partial indemnity costs.