COURT FILE NO.: 632/03

Brampton: 02-BN-7458

DATE: 20041101

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

O’DRISCOLL, MATLOW and jennings jj.

B E T W E E N:

DEMAN CONSTRUCTION CORPORATION

Respondent

(Plaintiff)

• and -

1429036 ONTARIO INC., AAA MOVE MASTER LTD., RICK BENIPERSAUD, ROMSPEN INVESTMENT CORPORATION, as Trustee and 1531685 ONTARIO INC.

Appellants

(Defendants)

Leo Klug

for the Appellants (Defendants) 1429036

Ontario Inc., AAA Move Master Ltd. and

Rick Benipersaud

A. M. Esposito and M. Tassou

for the Respondent (Plaintiff)

HEARD AT TORONTO: MAY 11, 2004

O’DRISCOLL J.:

I. NATURE OF THE PROCEEDINGS

1The appellants/defendants 1429036 Ontario Inc. (“142”), AAA Move Master Ltd. (“AAA”) and Rick Benipersaud (“Benipersaud”) appeal to the Divisional Court under the provisions of s.71 of the Construction Lien Act, R.S.O. 1990, c.C.30 (“CLA”):

71. (1) …. an appeal lies to the Divisional Court from a Judgment or an order on a motion to oppose confirmation of a report under this Act.

(2) A party wishing to appeal shall file and serve a notice of appeal within fifteen days of the date of the Judgment or order, but the time for filing or serving the notice of appeal may be extended by the written consent of all parties, or by a single judge of the Divisional Court where an appropriate case is made out for doing so.

2The named appellants appeal from the order of Boissoneault J., dated June 19, 2003:

(i) refusing to set aside the noting of default against the appellants on September 27, 2002, and;

(ii) refusing to set aside the default judgment, signed by the Registrar at Brampton, Ontario, against these appellants on September 27, 2002, in the sum of $2,536,789.14 together with $517.50 for costs.

3In this court, the named appellants ask that an order be made setting aside the impugned order of Boissoneault J. and for an order permitting the appellants to deliver their statement of defence.

4The appeal is dismissed for the reasons that follow.

ii. the parties

5The appellant, 142, an Ontario corporation, is the registered owner of the lands and premises (“subject lands”) municipally known as 3263 Derry Road East, Mississauga, Ontario, the land to which the claim for lien attaches.

6The appellant, AAA, is an Ontario corporation.

7The appellant, Benipersaud, was an officer and director of both 142 and AAA.

8The respondent, DeMan Construction Corporation (“DeMan”), is an Ontario corporation carrying on business as a general contractor. Gary DeMan is a director and the president of DeMan and his cousin, Peter DeMan, is the secretary/treasurer of DeMan.

III. chronology

9In the autumn of 2001, DeMan agreed to make extensive interior renovations to an existing building on the subject lands and also to construct a sizeable addition to the existing building in order to convert a Canadian Legion Hall into a funeral home.

10In February, 2002, Benipersaud asked Gary DeMan and his cousin, Peter DeMan, to attend a meeting at the offices of Michael E. Weir, Q.C., Benipersaud’s solicitor. At the February, 2002 meeting, DeMan, 142 AAA and Benipersaud signed a thirty-two (32) page CCDC standard form of Stipulated Price Contract, dated November 6, 2001, which Gary DeMan had previously prepared. (Appeal Book and Compendium, volume I: p.123-154). The contract price was $1.1 million and the value added taxes were $77,000 for a total of $1.177 million. The contract provided that “these amounts shall be subject to adjustment as provided in the contract document”.

11At the February, 2001, meeting, Mr. Weir advised the DeMans that there was a real possibility that the first mortgagee, Rompsen Investment Corporation (“Rompsen”), would attempt to sell the subject land under the power of sale in the mortgage or foreclose on the mortgage lands unless Rompsen’s mortgage was brought into good standing. The respondent, in order to bring the mortgage into good standing, paid the mortgage arrears to Rompsen in the amount of $273,035.

12Pursuant to the terms of the contract, DeMan rendered invoices to the appellants for services and materials supplied. Under the terms of the contract, each invoice was due and payable within fifteen (15) days of its date.

13When the appellants did not pay the invoices submitted, DeMan, commencing on August 15, 2001, registered claims for lien against the subject property for the amounts set out in the invoices.

14The dates and amounts of the registered liens are as follows:

August 15, 2001 -- $ 60,498.11

October 30, 2001 -- $284,989.43

December 10, 2001 -- $289,656.74

January 4, 2002 -- $278,210.54

February 12, 2002 -- $396,561.91

March 21, 2002 -- $459,630.25

April 11, 2002 -- $ 8,021.50

April 16, 2002 -- $268,332.28

July 24, 2002 -- $2,332,738.43 (global)

15Schedule “A” to the statement of claim sets out the number, the date and the amount of the invoice and Schedules “B” to “J”, inclusive, of the statement of claim set out copies of the claim for lien as registered, culminating in the global claim for lien in Schedule “J” on July 24, 2002, in the amount of $2,332,738.43.

16As set out in paragraph 10 of the statement of claim, none of the invoices has been paid. (Appeal Book, volume 1, p.162-185. See also: amended statement of claim: Appeal Book and Compendium, volume I, p.249-272).

17On April 19, 2002, Benipersaud signed a “Change Order” setting out the invoices to that date. The document states: “additional work performed as per attached statement of invoices. The owner has acknowledged that he has received and accepted these invoices:

Original Contract Amount………………….$1,100,000,00, plus G.S.T.

The Contract Price is increased by the sum of…$812,667.80, plus G.S.T.

New Contract Amount………………………$1,912,667.80, plus G.S.T.”

The second page of the Change Order lists the “attached invoices”:

W.O.#	Inv.#	Date	Description	Pre-GST	GST	Total Inv.
G-562	9705	07/06/2001	Build funeral home – Draw 1	$56,540.29	$3,957.82	$60, 498.11
G-562	9961	09/25/2001	Build funeral home – Draw 2	$266,345.26	$18,644.17	$284.989.43
G-562	10097	10/31/2001	Build funeral home – Draw 3	$204,359.91	$14,305.19	$218,665.10
W1-021	10100	10/31/2001	Electrical for Funeral Home – Draw 1	$66,347.33	$4,644.31	$70,991.64
G-562	10163	12/06/2001	Build funeral home - Draw 4	$242,696.73	$16,988.77	$259,685.50
W1-021	10168	12/06/2001	Electrical for Funeral Home – Draw 2	$17,313.12	$1,211.92	$18,525.04
G-562	10296	01/22/2002	Build funeral home – Draw 5	$362,463.52	$25,372.45	$387,835.97
W1-021	10297	01/22/2002	Electrical for Funeral Home – Draw 3	$8,155.08	$570.86	$8,725.94
G-562	10413	02/26/2002	Build funeral home – Draw #6	$318,370.94	$22,285.97	$340,656.91
G-661	10415	02/26/2002	Site Plan	$13,864.57	$970.52	$14,835.09
G-593	10416	02/06/2002	Design work	$4,186.16	$293.03	$4,479.19
G-667	10418	02/26/2002	Fibre glass fire rated dome	$32,982.61	$2,308.78	$35,291.39
W-1131	10419	02/26/2002	Fire Alarm & Emergency Lighting	$31,890.00	$2,232.30	$34,122.30
W-1021	10420	02/26/2002	Draw #4 - Electrical	$21,192.48	$1,483.47	$22,675.95
W-1143	10421	02/26/2002	Parking lot lighting	$7,074.22	$495.20	$7,569.42
W-1021	10475	03/27/2002	Draw #5 - Electrical	$7,496.73	$524.77	$8,021.50
G-562	10484	03/25/2002	Build funeral home – Draw #7	$222,642.37	$15,584.97	$238,227.34
G-661	10486	03/25/2002	Draw # 2 – Site Plan	$4,357.46	$305.02	$4,662.48
G-697	10487	03/25/2002	Shoe rack	$3,802.66	$266.19	$4,068.85
G-695	10488	03/25/2002	Curbs	$19,975.34	$1,398.27	$21,373.61

$1,912,667.80 $133,886.75 $2,046,554.55

TOTAL OUTSTANDING AMOUNT (G.S.T. included in amount) $2,046,554.

18Following April 19, 2002, there were additional “extras” that DeMan made on behalf of all of the appellants in order to enable the appellants to open the funeral home for business. Payments made on behalf of the appellants by DeMan included the funeral home’s:

(i) utility bills;

(ii) furniture;

(iii) landscaping;

(iv) advertising;

(v) drawings;

(vi) site plan approval;

(vii) permits; and,

(viii) mortgage payments.

19To this day, the appellants have not paid one penny on account of any of the goods and services provided by the respondent and incorporated into the subject lands and funeral home. The appellants opened the funeral home and have been carrying on the business on the subject lands since May, 2002. (See: Appeal Book and Compendium volume I: p.156).

20On August 13, 2002, the respondent issued a statement of claim claiming $2,332,738.43 from the appellants, being the acknowledged amount set out in the April 19, 2002, “Change Order” of $2,046,554.12 plus the “extras” and interest payable, as set out in invoices delivered to the appellants, increasing the amount owing to $2,332,738.43.

21The respondent’s statement of claim was served on the appellants on September 6, 2002.

22The CLA provides:

s.54 (1) The time for delivering a statement of defence to a lien claim, cross-claim, counterclaim or third party claim shall be twenty days.

s.67(3) Except where inconsistent with this Act, and subject to subsection (2), the Courts of Justice Act and the rules of court apply to pleadings and proceedings under this Act.

The Rules of Civil Procedure provide:

19.04(1) Where a defendant has been noted in default, the plaintiff may require the registrar to sign judgment against the defendant in respect of a claim for,

(a) a debt or liquidated demand in money, including interest if claimed in the statement of claim (Form 19A);

23On September 26, 2002, the appellants’ statement of defence was due pursuant to the provisions of s.54(1) of the CLA. However, the appellants had not served or filed their statement of defence.

24On September 27, 2002, the solicitors for the respondent had the appellants noted in default and filed a “Requisition for Default Judgment” authored by Ms. M. Tassou, counsel for the respondents, listing the fifteen (15) invoices sent to the appellants by the respondent. The “Requisition” sets out the amount and the due date of each invoice and shows the interest calculations. The principal sum owing as of September 27, 2002, was $2,332,738.43 plus interest of $204,050.71 for a total of $2,536,789.14. (Appeal Book and Compendium, volume I; p.192-197).

25On September 27, 2002, the Registrar signed default judgment in favour of the respondent against the appellants in the sum of $2,536,789.14 plus $517.50 for costs.

26On October 7, 2002, the Registrar at Brampton issued a Writ of Seizure and Sale against the real and personal property of the appellants. It was filed with the Sheriff of the Regional Municipality of Peel on October 8, 2002. (Appeal Book and Compendium, volume I, p.212-214).

27Leaving aside all the missteps by the then solicitor for the appellants, after the respondents refused to consent to an order setting aside the noting in default and the default judgment of September 27, 2002, counsel for the appellants launched a motion on October 1, 2002, which eventually came on before Boissoneault J. on April 9, 2003, seeking an order:

(i) setting aside the noting in default,

(ii) setting aside the default judgment; and,

(iii) granting leave to file the draft statement of defence and counterclaim annexed to the Notice of Motion.

28Boissoneault J. reserved judgment. On June 19, 2003, he delivered written reasons which state, in part:

[2] After default judgment was granted, and prior to these proceedings, the defendant Rick Benipersaud changed his name to Rick Benisasia. There shall be an unopposed order to add the words “now or also known as Rick Benisasia” after the name of the defendant, Rick Benipersaud, in the title of proceedings and the judgment. There will also be an order directing the Sheriff of Peel to amend the Writ of Seizure and Sale issued October 7, 2002 as Execution No. 02-2620 to add the same words following the name of this defendant, where it appears on the said writ. For the purposes of this order, I shall continue to refer to this defendant as “Benipersaud”. I will refer to the defendants 1429036 Ontario Inc. and AAA Move Master Ltd. as “142 Inc.” and “AAA Ltd.” respectively.

[4] On November 6^th, 2001, a standard construction document was executed by the plaintiff as contractor and by Rick Benipersaud, Benisasia Funeral Home, 142 Inc. and AAA Ltd. Benipersaud signed on behalf of the two defendant corporations and signed personally. In my view, the contract bound all these three defendants.

[8] The plaintiff states that from August 15, 2002, over 50 progress invoices were forwarded to the defendants. None of the invoices were honoured.

[9] The Rompsen mortgage fell into arrears and the plaintiff paid the sum of $273,035.00 to bring it into good standing.

[10] Though the funeral home has been opened since May of 2002 and generating income, no payments have yet been made to the plaintiff.

[12] The defendants have filed a supplementary motion record which contains a draft Statement of Defence and counterclaim generally disputing the existence of a contract between the parties. On this point, I accept the evidence of Garry DeMan and I accept his evidence related to the reasons for cost overruns.

[13] The counterclaim seeks damages in the amount of $1,500,000.00. No details supporting this claim are set out in the counterclaim.

[14] Attached as a schedule to the defendants’ submissions are some details supporting the counterclaim amount of $1,500,000.00. These details are bereft of particularity and cannot be considered as a statement of material facts.

[17] I find that the defendants, based on their past conduct and the evidence, do not have an arguable case on the merits. There is no evidence in the material to support a meritorious defence. In addition, the defendants have ignored their obligations to the plaintiff to this time. There is no evidence to show that the defendants even addressed the issues of payment, deficiencies in the work or the existence of a contract with the plaintiff before or since the funeral home started operating until default judgment was obtained.

IV. OUT-OF-TIME NOTICE OF APPEAL

29Section 71(2) of the CLA provides that “a party wishing to appeal shall file a Notice of Appeal within 15 days of the date of the judgment or order …”.

30Boissoneault J.’s judgment is dated June 19, 2003. The appellants launched their appeal to the wrong court (the Court of Appeal) on July 18, 2003.

31On October 9, 2003, the Court of Appeal ordered that the appeal be transferred to the Divisional Court.

32The time for appeal prescribed under s. 71(2) of the CLA is fifteen (15) days. The appellants’ Notice of Appeal did not appear on the scene until twenty-nine (29) days after the judgment. The appellants have never brought a motion seeking an extension of the time to serve and file their Notice of Appeal. The respondent takes the position that the appeal has been brought out of time and should be dismissed for that reason alone. I agree.

V. application to the divisional court to admit “fresh evidence”

33At the opening of the appeal, counsel for the appellants brought a motion seeking to file “fresh evidence” by way of an affidavit. After hearing submissions from all counsel, the application was dismissed for the following recorded oral reasons:

Counsel for the appellants/defendants has brought an application to admit fresh evidence on this appeal.

The requirements to admit fresh evidence are:

(i) the proposed evidence could not have been discovered even with due diligence prior to the hearing before Boissoneault J.,

(ii) the proposed evidence must be relevant in that it bears upon a decisive or a potentially decisive issue in the original hearing,

(iii) the evidence must be reasonably capable of belief, and

(iv) it must be evidence which, if believed, when taken with the other evidence at the original hearing, be expected to have affected the result. (See: R. v. Palmer, 1979 8 (SCC), [1980] 1 S.C.R. 759; Cook v. Mounce (1979), 1979 2039 (ON SC), 26 O.R. (2d) 129 (Div. Ct.).

In our view, the appellants have not satisfied the prerequisites of these decisions.

Moreover, even if the proposed affidavit were admitted, in our view, the evidence is not relevant to any issue on this appeal.

The motion is, therefore, dismissed.

vi. did the registrar have jurisdiction to:

(I) note the appellants’ default and/or

(II) sign the default judgment against the appellants?

34Under s. 54(2) and (3) of the CLA, the appellants, having failed to file a statement of defence within the twenty (20) days prescribed by the statute, may be noted in default and are not allowed to file a statement of defence “except with the leave of the court, to be given only where the court is satisfied that there is evidence to support a defence …”.

35Under rule 19.04(1)(a), the claim must be for “a debt or liquidated demand in money” in order to clothe the Registrar with jurisdiction to sign default judgment.

36It is submitted by the appellants that because paragraph [7] of the statement of claim alleges that the respondent entered into an agreement with the named defendants/appellants, “or anyone of them,” it is impossible to determine the identity of which appellant, if any, against whom judgment may be signed.

37Counsel for the appellants also submits that the claim of the respondent is “substantially not a liquidated claim, and therefore not within the jurisdiction of the Registrar” to sign default judgment.

38Moreover, it is alleged by the appellants that “no method of calculation of such amount was pleaded, nor any agreement that the amount of $2,332,738.43 was ever agreed upon”.

Conclusions

39As to the appellants’ submission that it is impossible to know who, if any, of the appellants is liable for anything, that submission is answered by paragraph [66] of the Respondent’s Factum:

In subparagraph 10(a) of the Appellants’ factum, the Appellants allege that ‘at no time was Benipersaud to sign personally’ and that ‘the liability was only to be that of 1429036 Ontario Inc.’ However, in the Affidavit of Elizabeth Ledo filed in support of the Motion, she affirms that Rick Benipersaud advised her and she believes, that Rick Benipersaud and AAA Move Master Ltd. were guarantors of the obligations of the owner, 1429036 Ontario Inc. “and the claim against them would have been possible only on the basis of such guarantee”. Later, in his affidavit of November 1, 2002, Rick Benipersaud alleges that it was never contemplated that he would be personally liable for anything related to DeMan, without reference to the prior inconsistent affidavit evidence.

40Benipersaud attempts to escape liability by stating that he chose not to read a document which he signed. Assuming that to be so, it is of no legal significance.

41In Fraser Jewellers (1982) Ltd. v. Dominion Electric Protection Co. (1997), 1997 4452 (ON CA), 34 O.R. (3d) 1 (Ont. C.A.), Robins J.A., (for the court), said:

As a general proposition, in the absence of fraud or misrepresentation, a person is bound by an agreement to which he has put his signature whether he has read its contents or has chosen to leave them unread: Cheshire, Fifoot & Furmston’s Law of Contract, 13^th ed. (1996) at p. 168. Failure to read a contract before signing it is not a legally acceptable basis for refusing to abide by it. A businessman executing an agreement on behalf of a company must be presumed to be aware of its terms and to have intended that the company would be bound by them. The fact that Mr. Gordon chose not to read the contract can place him in no better position than a person who has. Nor is the fact that the clause is in a standard pre-printed form and was not a subject of negotiations sufficient in itself to vitiate the clause: L’Estrange v. F. Graucob Ltd., [1934] 2 K.B. 394 at p. 403, [1934] All E.R. Rep. 16 (D.C.); Craven v. Strand Holidays (Canada) Ltd. (1982), 1982 1859 (ON CA), 40 O.R. (2d) 186 at p. 194, 142 D.L.R. (3d) 31 (C.A.).

Is the default judgment “for a debt or liquidated demand in money”?

42In my view, the contract signed on behalf of the appellants by Benipersaud, dated November 6, 2001, the invoices, the nine (9) registered liens, the “change order”, dated April 19, 2002, signed by Benipersaud on behalf of all appellants and his admissions set out above, all persuade me that the respondent’s claim is for a debt or liquidated demand in money.

43In St. Clair Roofing & Tinsmithing Inc. v. Davidson (1992), 1992 7660 (ON SC), 8 O.R. (3d) 578, Master Sandler dealt with a motion by the defendants to set aside a default judgment in the context of a construction lien action. The Master held that in a construction lien action where the defendant has been noted in default of filing a statement of defence, a plaintiff may have the Registrar sign default judgment under rule 19.04 if the only relief that the plaintiff seeks is a debt or liquidated demand in money and interest, if claimed in the statement of claim. The Master said “I thus rule that the plaintiff’s default judgment under rule 19.04(1)(a) here, providing as it does only for payment by the defendant owners, Roger Davidson and Myra Davidson of the sum of $89,542.05 and $275 for costs, is a valid, regular and proper judgment, and one authorized by the Act and the rules”. With respect, I agree with Master Sandler.

44The submission that “no method of calculation of such amount was pleaded, nor any agreement that the amount was ever agreed upon” is answered by the admissions of the appellants made through Benipersaud that he received the invoices, most of which are set out in the “change order”, the schedules to the statement of claim and the amount set out in the construction liens registered on title. The whole calculation was summed up in the form 19A, requisition for default judgment, submitted to the Registrar when default judgment was requested (Appeal Book & Compendium, vol. I, p.192-197).

45In Nippon Express Canada Ltd. v. Provan, [2003] O.J. No. 3578, the Court of Appeal for Ontario heard an appeal where the appellant/defendant sought to set aside the order of Greer J. who refused to set aside the default judgment granted by Festeryga J. In its endorsement, the Court of Appeal said:

Counsel for the appellants argued that because the cause of action asserted in the statement of claim was for fraud, that the resulting judgment for $143,462.06 was not a liquidated sum as required by rule 19.04(1)(a). Counsel relied upon the judgment of this court in Schill et al. v. Gallagher 2001 24134 (ON CA), [2001] O.J. No. 260. We are satisfied that the Schill case is distinguishable from the case at bar. In that case, the court had some doubt as to the amount in issue and the need to justify it. We have no such doubt in this case. The amount of $143,462.06 was supported by a detailed schedule of invoices.

conclusion

46In my view, in this case, the Registrar had jurisdiction because the claim fell within rule 19.04(1)(a) – “a debt or liquidated demand in money”. Here, too, the amount was supported by detailed invoices.

47It is noted that the Notice of Motion, dated October 11, 2002 (Appeal Book & Compendium, vol. I: p.14) returnable before Boissoneault J., does not allege that the Registrar was without jurisdiction when default was noted and the default judgment was signed under rule 19.04(1)(a). Counsel advised us that, before Boissoneault J., this ground of appeal was never argued. The argument was made for the first time on May 11, 2004, before the Divisional Court.

vii Even though the Registrar had jurisdiction under rule 19.04(1)(a), should the motions judge have set aside the Noting of Default and the default judgment?

48On the appellants’ motion before Boissoneault J. to set aside the Noting of Default under the CLA, the governing principle is found in s. 54(3) of the Act. It stipulates that once default has been noted, the defendants/appellants shall not be permitted to deliver a statement of defence, except with the leave of the court, to be given only when the court is satisfied that there is evidence to support a defence.

49The motions judge reviewed the material before him – affidavits with exhibits and cross-examinations on the affidavits. It is a written record.

50In Equity Waste Management of Canada v. Halton Hills (Town) (1997), 1997 2742 (ON CA), 35 O.R. (3d) 321 (Ont. C.A.), Laskin J.A. (for the court) said:

The judgment of Morden A.C.J.O. recognizes that review of a trial or motion judge’s findings of fact on a standard of correctness is inappropriate, even though the judge heard no oral evidence. An appellate court is not justified in intervening merely because it takes a different view of the evidence. Admittedly, the traditional rationale for deference to a trial judge’s findings of fact – the trier’s advantage of seeing and hearing the witnesses – does not apply when all of the evidence is written; but other policy considerations support a deferential standard of review on appeal.

Therefore, although the entire record before a trial judge or a motion judge consists of documentary or written evidence, as it does in this case, the judge’s factual findings are entitled to deference on appeal. What standard of deference applies in such a case? It is not easy to articulate a standard less deferential than “manifest error” but falling short of “correctness”. I suggest that it may simply be a matter of weight or emphasis, or that, plausibly, a uniform standard of appellate review should be applied to a trial judge’s findings of fact, whether the evidence is entirely oral, entirely documentary or, more typically, a combination of the two.

What is important for this appeal is the kind of error that justifies intervention by an appellate court. An error of law obviously justifies intervention. An appellate court may interfere with a finding of fact if the trial judge or motion judge disregarded, misapprehended, or failed to appreciate relevant evidence, made a finding not reasonably supported by the evidence, or drew an unreasonable inference from the evidence.

51In my view, the motions judge correctly assessed the evidence on the written record before him and found that the appellants contracted for, and acknowledged receipt of the invoiced goods and services. However, for their own reasons, the appellants decided to “play hardball” knowing that the respondent would have to continue to “carry” them because the respondent was so deeply involved it could not risk to do otherwise.

52In short, Boissoneault J. accepted the evidence materials of the respondent as credible and found Benipersaud and the other appellants not to be credible. Boissoneault J. was entitled to make those findings and he had more than sufficient evidence upon which to base his findings.

53I see no error in any findings of fact or inference drawn by the motions judge. Nor has it been shown to me that the motions court judge failed to apply the appropriate law to the facts that he found. (See: Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, paras. [8], [10], [15], [19], [23] [26], [27] and [28]).

54On the written record before him, the motions court judge accepted the affidavit of Gary DeMan, found that there was a contract, that the appellants received the invoices from the respondent and paid none of them. Boissoneault J. also found that the counterclaim was so bereft of particularity that it could not be considered a statement of material facts.

55It was also pointed out to Boissoneault J. that Benipersaud refused to answer questions at his January 9, 2003 cross-examination and failed to answer undertakings given at that time. (See: Questions 592, 600, 98, 101, 158, 196, 416, 586 and 699). Boissoneault J. did not accept the allegations of the appellants put forward through Benipersaud. Accordingly, Boissoneault J. was not satisfied that there was evidence to support a defence (s. 54(3) of the CLA) and dismissed the motion.

conclusion

56In my view, there is no basis in law, mixed law and fact or in fact to reverse the order in appeal.

57The proposed defence proferred by the appellants in their draft statement of defence and counterclaim is tantamount to pleading that:

(a) “this never happened”,

(b) we did not sign any binding contract (s) or, if we did, it had no legal significance

(c) we know nothing about the April 19, 2002 “change order” signed by Rick Benipersaud when he acknowledged receipt of invoices to that date, none of which has ever been paid.

(d) Although goods and services were never supplied by the respondent to us and incorporated into the subject property, somehow we have a counterclaim against the respondent for $1.5 million and somehow, a Canadian Legion Hall was converted, at no cost to us, into the funeral home operated by the appellants since May 2002.

58Paragraph [69] of the respondent’s factum states:

a) The Appellants have been operating the funeral home since May of 2002 generating substantial income. However, they have continued to refuse to pay DeMan one dime towards the construction costs of the funeral home. DeMan submits that the Appellants are simply using this Appeal as a further delay tactic to delay payment to DeMan for monies properly due and owing to it.

59On this record, it would be difficult for me to disagree with that assessment of this case.

viii result

60The appeal is dismissed.

ix costs

61If counsel are unable to agree, within fifteen (15) days after release of these reasons, as to the costs of this appeal, including the costs reserved to the Divisional Court under paragraph [2] of the order of Doherty J.A., dated October 9, 2003: (a) counsel for the respondent shall submit a draft bill of costs and brief written submissions within twenty-five (25) days of the release of these reasons, (b) if so advised, in response, counsel for the appellants shall have the right to submit brief written submissions within thirty-five (35) days of the release of these reasons and, (c) if so advised, counsel for the respondent shall have the right to submit very brief written reply submissions within forty (40) days of the release of these reasons. Thereafter, costs shall be fixed.

O’DRISCOLL J.

JENNINGS J.

MATLOW, J. ( Dissenting)

61With respect, I am unable to agree with the disposition of the majority. I would extend the time for bringing this appeal and allow the appeal of the moving parties from the order below by varying paragraph 2 to provide that the default judgment of the Registrar dated September 27, 2002, but not the noting in default be set aside as against the appellants. I would also set aside paragraph 3 of the order and invite counsel to make further submissions with respect to the costs of the motion below and of this appeal and, for that purpose, reserve judgment. What follows are my reasons.

62The default judgment, which is for $ 2,536,789.14, was signed by the Registrar pursuant to rule 19.04 (1) (a) of the Rules of Civil Procedure. The amount of the judgment was made up of $2,332,738.43 for claim plus $204,050.71 for costs. It was signed by the Registrar after the appellants were noted in default pursuant to a requisition submitted on behalf of the respondent which rested on the assertion that the respondent’s claim was for “a debt or liquidated demand in money”. It was on this assumption that the Registrar purported to exercise his jurisdiction conferred by the rule to sign the judgment. If the respondent’s claim had been for unliquidated damages, the Registrar would have had no jurisdiction to sign the default judgment. That jurisdiction is and can be conferred only on section 96 judges by virtue of their constitutional powers.

63Contrary to the apparent view of the Registrar, the motions judge and the majority, my examination of the statement of claim in this case has persuaded me that the respondent’s claim was not for “a debt or liquidated demand in money” but, rather, for unliquidated damages. It is the way that a claim is set out solely in a statement of claim that determines whether it is a claim for a liquidated sum or for unliquidated damages. (See Schill & Beninger Plumbing & Heating Ltd. v. Rozon (2001) 2001 24134 (ON CA), 6 C.P.C. (5^th) 80 (Ont. C.A.) The Registrar must be able to determine solely from his examination of the pleading whether or not he has jurisdiction to sign a default judgment.

64The reasons of the majority, particularly at paragraph 42, reveal a reliance entirely on documentation extraneous to the statement of claim to support their holding that the plaintiff’s claim was for a liquidated sum. As indicated above, this approach runs contrary to the explicit wording of rule 19.04(1) which makes specific reference to a “claim” for a liquidated sum and is contrary to the holding of the Court of Appeal in Schill.

65The essential details of the respondent’s claim are set out in paragraphs 7 to 11, inclusive, of the statement of claim. In those paragraphs the respondent alleges that it entered into an agreement with the appellants, or one of them, by which it “agreed to act as the general contractor for the construction of a funeral home…. at a contract price of $1,177,000.00 inclusive of GST”. Subsequently, “there were changes to the Contract work which increased the Contract price to $2,332,738.43 inclusive of GST”. The respondent then alleges that it rendered invoices from time to time but has not received any payment from any of the appellants.

66It is not alleged in the statement of claim that the amount by which the contract price was increased by reason of the changes to the contract work was agreed to by the appellants or could be ascertained by calculation or fixed by any scale of charges or other positive data. Rather, the essence of the pleading is only that the original contract price was increased and that invoices were rendered.

67Accordingly, it is my respectful view that the Registrar was required to refuse to sign default judgment and the respondent was required to seek judgment by moving for judgment before a judge on affidavit evidence pursuant to rule 19.05(1).

68The reasons of the majority reveal that they have come to a different conclusion on the authority of the judgment of the Court of Appeal in Nippon Express Canada v. Provan, (September 18, 2003) [2003] O.J. No. 3578 relying on the following passage in paragraph 2 of the reasons for judgment in that case;

We have no such doubt in this case (that the default judgment was for a liquidated sum). The amount of $143,462.06 was supported by a detailed schedule of invoices.

69The majority concluded that the reference to “a detailed schedule of invoices” in Nippon was the equivalent of the invoices rendered by the respondent to the appellants in this case and was sufficient to characterize the respondent’s entire claim as one for a liquidated sum. However, with respect, it is my view that a careful review of the facts in Nippon show that Nippon must be distinguished and that the conclusion of the majority which rested on their interpretation of Nippon was reached in error.

70In Nippon, the defendant, a trusted employee of the plaintiff, rendered false invoices in the name of his sole proprietorship to the plaintiff for services that were never provided and the plaintiff, believing that the invoices were proper, paid the amounts sought to the defendant. When the defendant’s fraudulent conduct was discovered, the plaintiff commenced action against the defendant for the amount obtained by the defendant through his fraudulent scheme. That amount was precisely the total of the amounts set out in the fraudulent invoices rendered by the defendant. The defendant did not defend the action as required and default judgment was signed against him. On the subsequent motion by the defendant for an order setting aside the default judgment on the ground that it was not for a liquidated sum, the motions judge held that it was for a liquidated sum because it “was supported by a detailed schedule of invoices” and she refused to set aside the default judgment. The decision of the judge was subsequently upheld by the Court of Appeal.

71It is evident that the amount claimed in Nippon was the total of the amounts set out in the fraudulent invoices because that was the amount actually obtained by the defendant’s fraud. The amount claimed could be ascertained by calculation and could not reasonably have been any other amount. It is, therefore, not surprising that both the motions judge and the Court of Appeal held that the default judgment was for a liquidated sum.

72In Nippon, the invoices were rendered by the defendant in order to advance his fraudulent scheme. In this case, the invoices were rendered by the respondent, the plaintiff, as parts of its billing process.

73In contrast with Nippon, there is nothing in the statement of claim in this case, which explains how the amounts claimed for changes to the contract were determined. Presumably the respondent could have chosen any amounts that it wished. The fact that the respondent set out the amounts it had unilaterally determined in a series of invoices could not have changed the character of the total sum from unliquidated to liquidated.

74The significance of the invoices in Nippon was, accordingly, much different from the significance of the invoices in the case at bar and they ought not, in my view, to be regarded as equivalents.

75Therefore, because default judgment was signed by the Registrar without jurisdiction, the appellants are entitled, as a matter of right, to have it set aside. The default judgment is a nullity and this court is obliged to set it aside, even outside the time allowed for moving against it, to record the court’s recognition that it was signed without jurisdiction. The appellants are not required in such circumstances to adduce evidence of a good defence on the merits.

76Nevertheless, the appellants are not, in my view, entitled to have the noting in default set aside. The motions judge held, at paragraph 17 of his reasons, that the appellants “do not have an arguable case on the merits” and I agree with the majority that this holding ought not to be disturbed. It follows that the noting in default pursuant to both rule 19.02 and pursuant to section 54 (3) of the Construction Lien Act must not be disturbed and the respondent should be left to pursue its remedy in accordance with the manner prescribed by the Act and the Rules.

MATLOW, J.

Released:

COURT FILE NO.: 632/03

Brampton File No.: 02-BN-7458

DATE: 20041101

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

o’driscoll, matlow and jennings jj.

B E T W E E N:

DEMAN CONSTRUCTION CORPORATION

Respondent (Plaintiff)

• and -

1429036 ONTARIO INC., AAA MOVE MASTER LTD., RICK BENIPERSAUD, ROMSPEN INVESTMENT CORPORATION, as Trustee and 1531685 ONTARIO INC.

Appellants (Defendants)