CITATION: Men At Work General Contractors Ltd. v. MacDonald, Phillip, 2015 ONSC 3413
DIVISIONAL COURT FILE NO.: 432/14
DATE: 20150527
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
SACHS, R. J. SMITH AND D. L. CORBETT JJ.
BETWEEN:
MEN AT WORK GENERAL CONTRACTORS LTD.
Plaintiffs/Respondents
– and –
ROSS MACDONALD and JACQUELINE MARCIA PHILLIP
Defendants/Appellants
Michael Meredith, for the Plaintiffs/ Respondents
Michelle R. Theberge, for the Defendants/ Appellants
HEARD at Toronto: May 27, 2015
D. L. CORBETT J. (ORALLY)
[1] The reasons of the motion judge are inadequate. They fail to cite and follow the proper standard of review on a motion to oppose confirmation of the Master’s Report. The two pages of reasons are largely narrative. The finding in para. 13 of legal error committed by the Master is conclusory and does not advert to material findings of fact made by the Master.
[2] Master Polika interpreted the reporting requirement in the contract in a pragmatic way based on the commercial context. There is no obvious error in this interpretation and no basis in the motion judge’s reasons for her conclusion that the Master erred.
[3] For the reasons that follow, we set aside the decision of the motion judge and substitute in its place an order confirming the Master’s Report, subject to a minor correction of the arithmetical error in calculating fifty percent of the cost overruns.
[4] The decision of the experienced construction lien Master is entitled to deference on a motion to oppose confirmation of his report. As stated by the Divisional Court in Visram v. Chandarana, [2008] O.J. No. 1407 at para. 22:
I can see no principled basis for not applying the same standard of review to final decisions of a master as are applied to final decisions of a judge. I also agree with Mr. Dorsey’s submission that in the construction lien area, where many of the cases are initially decided by a master subject to confirmation by a judge, we already have adopted the same deferential standard as is applied to trial judges.
[5] The Master dismissed the lien claim because the plaintiff failed to prove that the lien was preserved and perfected within the time periods prescribed by the Construction Lien Act or at all. The Master did not err in this conclusion.
[6] The Master dismissed the contract claim against Ms. Phillip because she is not a party to the contract. The Master did not err in this conclusion.
[7] The parties agreed on the amounts in dispute:
(a) Claim for $26,932.50 for project management and profit;
(b) Claim for $34,005.00 paid by the plaintiff to sub-contractors;
(c) Counterclaim for costs to complete of $29,491.39; and
(d) Counterclaim for loss rental income of $34,250.00.
[8] The Master found that the plaintiff deliberately understated projected costs by 38%. This is a finding of fact rooted in the evidence.
[9] The Master found that the contract was a fixed price for two items: project management and profit, and costs plus on the basis of estimates for the balance of the contract. This finding is rooted in the evidence; there is no palpable and overriding error.
[10] The Master found that the contractor had a timely reporting obligation. This finding is rooted in the text of the contract and commercial reasonableness. The Master found that the appellant waived strict compliance with this term, however, the Master clearly concluded that the contractor knew of substantial cost overruns and failed to give the appellant timely notice of them.
[11] The contractor admitted to the appellant that he severely underestimated the costs and did not warn the appellants of these overruns until June 2008. See Exhibit Book, Vol. 1, pp. 162-163.
[12] The Master found that the contractor failed to manage the construction project properly. In this regard, the Master did not accept the contractor’s assertion that it owed no duty to the appellants to control and monitor costs or consult with the appellants on spending decisions.
[13] The Master concluded as a result that the contractor was not entitled to its fee for construction management and profit. This finding was available on the evidence. We see no error.
[14] The Master found the parties equally at fault for outstanding costs overruns. He ordered payment of 50% of the outstanding construction costs which he fixed at $15,002.50. The Master made an arithmetical error; the correct amount is $17,002.50. We would correct this error, which is palpable and overriding. In all other respects, we uphold this aspect of the Master’s decision, which was available on the evidence before him.
[15] The Master dismissed the counterclaim:
(a) because there was no fixed price contract, the defendants had no claim for their costs to complete the project; and
(b) because there was no schedule for completion of the contract to ground a delay claim for loss of rent.
These findings were available on the evidence and we see no error.
[16] The Master declined to award costs as a result of the conduct of both parties. This decision was within the Master’s discretion. We would not interfere.
[17] The decision of the motion judge is set aside. It follows that the costs awarded by the motion judge are also set aside as is the consequential order of R.S.J. Morawetz fixing those costs.
COSTS
SACHS J.
[18] I have endorsed the Record as follows: “This appeal is allowed for reasons given orally by D. L. Corbett J. The decision of the motion judge is set aside and the Report of Master Polika is confirmed, subject to one variation – the amount awarded to Men At Work by way of damages is increased from $15,002.50 to $17,002.50. The costs award of R.S.J. Morwetz is also set aside (as a consequence of the setting aside of the motion judge’s decision).
[19] The appellant is entitled to his costs of today, fixed in the amount of $10,000 (all inclusive) and his costs of the motion before E. Macdonald J. which are also fixed in the amount of $10,000 all inclusive. There shall be no order as to costs with respect to the appearance before R.S.J. Morzwetz.”
___________________________ D. L. CORBETT J.
SACHS J.
R. J. SMITH J.
Date of Reasons for Judgment: May 27, 2015
Date of Release: June 5, 2015
CITATION: Men At Work General Contractors Ltd. v. MacDonald, Phillip, 2015 ONSC 3413
DIVISIONAL COURT FILE NO.: 432/14 DATE: 20150527
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
SACHS, R. J. SMITH AND CORBETT JJ.
BETWEEN:
MEN AT WORK GENERAL CONTRACTORS LTD.
Plaintiffs/Respondents
– and –
ROSS MACDONALD and JACQUELINE MARCIA PHILLIP
Defendants/Appellants
ORAL REASONS FOR JUDGMENT
D. L. CORBETT J.
Date of Reasons for Judgment: May 27, 2015
Date of Release: June 5, 2015