Court File and Parties
CITATION: Rafat v. Duplex, 2016 ONSC 1988
DIVISIONAL COURT FILE NO.: DC-14-69-00
DATE: 20160316
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
J. WILSON, C. HORKINS AND PATTILLO JJ.
BETWEEN:
Rafat General Contract Inc., 2109347 Ontario Limited and The Bank of Nova Scotia Defendants/Appellants
– and –
Duplex Electrical Limited Plaintiff/ Respondent
COUNSEL:
M. Marchioni, for the Appellants
A. Riswick, for the Respondent
HEARD at Brampton: March 16, 2016
Oral Reasons for Judgment
J. WILSON J. (ORALLY)
[1] This is an appeal by the Respondent Rafat General Contractor Inc. ("Rafat") from the judgment of Edwards J. after an eight day Construction Lien Act, R.S.O. 1990 c. C.30 ("Construction Lien Act") trial. Rafat was the general contractor on the project. Rafat engaged Duplex Electrical Limited ("Duplex") as the sub-contractor to complete electrical. The electrical work was initially based upon two contracts. The scope of the work changed without being specifically reduced to writing.
[2] The relationship between the parties broke down and Rafat hired another electrical contractor. There was an issue regarding whether the work contemplated in the contracts between the parties had been completed when the relationship broke down and the other contractor was retained.
[3] Duplex registered a lien against the property. It claimed $84,567.78 for unpaid work under the two contracts and extras. Rafat counterclaimed for $42,074.76 for unfinished or deficient work.
[4] The judgment granted Duplex's claim in the amount of $84,567.78.
OVERVIEW OF THE DECISION
[5] The trial judge determined that Duplex completed the work contemplated in the two contracts by the time the relationship broke down. He concluded that Duplex invoiced Rafat for the work performed under the two contracts as well as the requested extras. He concluded that Rafat was obliged to pay for the work performed under the two contracts and the extra work requested and performed. Finally, he concluded that Rafat's principals refused to pay the amounts owing when confronted during the November 16, 2011 meeting. Hence, the trial judge ultimately found that Rafat breached the contracts. As Rafat did not respond to a letter from Duplex's counsel asking for permission to return to the jobsite, the trial judge found that such conduct constituted a failure on Rafat's part to reasonably mitigate its damages. The trial judge also found that Rafat failed to prove its damages and its counterclaim was dismissed.
THIS COURT'S JURISDICTION
[6] Section 71(1) of the Construction Lien Act confirms that"An appeal lies to the Divisional Court from a judgment or order on a motion to oppose confirmation of a report under this Act."
STANDARD OF REVIEW
[7] The decision, Gryphon Building Solutions Inc. v. Danforth Estates Management Inc., [2009] O.J. No. 2910 (Div. Ct.), a construction lien case, confirms that the standard of review is governed by the principles outlined in Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235.
[8] On a pure question of law, the standard of review is correctness. Factual findings should not be reversed absent a palpable overriding error. Questions of mixed fact and law are reviewed on a standard of correctness when the error of law is extricable from the facts. If not, a palpable and overriding error is required in order to overturn the trial judge.
[9] The Appellant claims that Edwards J. erred in law and that the standard of review is correctness. The Respondent submits that the interpretation of a contract is an issue of mixed fact and law requiring deference and that the applicable test is that of a palpable and overriding error: see B.W.K. Construction Company v. Bradhill Masonry Inc., 2015 ONSC 2963 (Div. Ct.).
[10] We find that the questions raised on appeal are of mixed fact and law and that the applicable standard of review is palpable overriding error.
ADEQUACY OF REASONS
[11] The purpose of a judge's reasons is to show why he or she arrived at a particular decision rather than how: see R. v. M. (R.E.), 2008 SCC 51, [2008] 3 S.C.R. 3 ("M. (R.E.)"). The reasons need not be so detailed that they allow an appellate court to retry the case on appeal: see R. v. DiNardo, 2008 SCC 24, [2008] 1 S.C.R. 788 ("DiNardo").
[12] The Appellant submits that a trial judge is obliged to clearly state in his or her reasons and the reasons for doubting the credibility of a witness. The Appellant asserts that the trial judge in this case failed to do so: see Re Pitts and Director of Family Benefits Branch of the Ministry of Community and Social Services (1985), 1985 2053 (ON SC), 51 O.R. (2d) 302 (Div. Ct.).
[13] The Appellant argues that the trial judge erred in law in failing to adequately explain or justify his rejection of the Appellant's evidence and acceptance of the Respondent's evidence. The Appellant suggests the trial judge preferred the evidence of the Respondent's witnesses on the basis of generalizations rather than specifically addressing inconsistencies in the evidence.
[14] We disagree.
[15] The detailed reasons of the trial judge are more than adequate to meet the test of sufficiency.
[16] We rely on the principles outlined in the decisions in the Supreme Court of Canada in R. v. Gagnon, 2006 SCC 17, [2006] 1 S.C.R. 621; DiNardo; and M. (R.E.) outlined below:
Assessing credibility is not a science. It is very difficult for a trial judge to articulate with precision the complex intermingling of impressions that emerge after watching and listening to witnesses and attempting to reconcile the various versions of events. That is why this Court decided most recently in H.L, that in the absence of palpable and overriding error by a trial judge, his or her perceptions should be respected. [para 20 – R. v. Gagnon]
Where a case turns largely on determinations of credibility, the sufficiency of the reasons should be considered in light of the deference afforded to trial judges on credibility findings. Rarely will the deficiencies in the trial judge's credibility analysis, as expressed in the reasons for judgment, merit intervention on appeal. [para 26 – DiNardo]
There is no need to prove that the trial judge was alive to and considered all the evidence or answered each and every argument of counsel. [para 32 – M. (R.E)]
[17] The trial judge at the beginning of the decision reviewed his general findings of credibility with respect to each of the witnesses. He then made observations as to credibility when he reviewed the evidence and reached his conclusion on the specific issues raised.
[18] For these reasons, we find that there is no merit to this ground of appeal. The reasons are more than sufficient.
FAILURE TO REDUCE THE PLAINTIFF'S CLAIM TO ACCOUNT FOR INCOMPLETE WORK
[19] The Appellant argues that the trial judge erred in law by failing to adjust the amount found owing to the Respondent for work included in the contracts but not yet not completed by the Respondent. The Appellant specifically points to the installation of light poles, trim and electrical box covers as examples of work that was not completed.
[20] The Appellant submits that, as a matter of law, damages for breach of contract in a construction lien case must be reduced by the reasonable completion cost of the work which was contemplated but not completed under the contract. The Appellant makes this assertion even in face of an owner's repudiation of the contract.
[21] It is not necessary to pronounce on this legal issue as the trial judge in this case made the clear finding of fact that the work had been completed as contemplated by the contracts by the time the relationship broke down and when Duplex was ordered by the Appellant off the jobsite.
[22] The trial judge found that the price of the subsequent electrical work done on the property bore no relationship to the two contracts between Rafat and Duplex. Since Duplex had completed its contracts, he found that any work which remained unfinished related to extras.
[23] We find that the trial judge appropriately considered the issues raised by the Appellant regarding unfinished work and rejected its submissions based upon his findings of fact and credibility.
[24] There is no merit to this ground of appeal. For these reasons the appeal is dismissed.
[25] As agreed between the parties, costs shall be paid by the Appellant to the Respondent in the amount of $10,000 plus HST
___________________________ J. WILSON J.
C. HORKINS J.
PATTILLO J.
Date of Reasons for Judgment: March 16, 2016
Date of Release: April 1, 2016
CITATION: Rafat v. Duplex, 2016 ONSC 1988
DIVISIONAL COURT FILE NO.: DC-14-69-00
DATE: 20160316
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
J. WILSON, C. HORKINS AND PATTILLO JJ.
BETWEEN:
Rafat General Contract Inc., 2109347 Ontario Limited and The Bank of Nova Scotia Defendants/Appellants
– and –
Duplex Electrical Limited Plaintiff/ Respondent
ORAL REASONS FOR JUDGMENT
J. WILSON J.
Date of Reasons for Judgment: March 16, 2016
Date of Release: April 1, 2016