Citation: Maplequest (Vaughan) Developments. Inc. v. 2603774 Ontario Inc., 2020 ONSC 4308
DIVISIONAL COURT FILE NO.: 1183/19 (Oshawa) DATE: 20200714
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
D.L. CORBETT, EMERY and LeMAY JJ.
B E T W E E N:
MAPLEQUEST (VAUGHAN) DEVELOPMENTS INC. Appellant
- and -
2603774 ONTARIO INC. and LALU CANADA INC. Respondents
Paul Guaragna and Mark De Sanctis, for the Appellant Michael Title and Patricia Virc, for the Respondents
Heard by Videoconference: July 13, 2020
REASONS FOR DECISION
The Court:
[1] Maplequest appeals from the order of R.E. Charney J. dated September 12, 2019, made pursuant to s. 47 of the Construction Lien Act,[^1] discharging Maplequest’s claim for lien in the amount of $1,604,951.40, and vacating its certificate of action, on the basis that the claim for lien was registered out of time.
Jurisdiction, Applicable Law and Standard of Review
(a) Jurisdiction
[2] Maplequest appeals a final order made under the Construction Lien Act.[^2] The appeal properly lies to this court.[^3]
(b) Applicable Law
[3] The Construction Lien Act has been amended and renamed the Construction Act. However, the parties agreed, correctly, both in this court and before the motions judge, that the CLA, as amended prior to July 1, 2018, applies to the issue on appeal.
(c) Standard of Review
[4] The ordinary “appellate standard of review applies: questions of law are reviewed on a “correctness” standard, questions of fact are reviewed on a standard of “palpable and overriding error”.[^4]
Summary and Disposition
[5] In summary, the motions judge found that the appellant completed its work and fully invoiced for this work by November 2017, eleven months before it registered its claim for lien. This conclusion was available to the motions judge on the record before him. At the conclusion of the hearing we dismissed the appeal with these reasons to follow today.[^5]
Background Facts
[6] The lands against which the lien is claimed are municipally known as 3812 Major Mackenzie Drive in Vaughan (the “Property”). They were acquired by the respondents[^6] in 2017 from Cicchino Holding Ltd. (“Cicchino”). Maplequest owns three parcels of land adjacent to and surrounding the Property (the “Maplequest Lands”).
[7] The Property and the Maplequest Lands were un-serviced development lands.
[8] On April 25, 2016, Maplequest and Cicchino entered into a contract (the “Cost Sharing Agreement”) pursuant to which Maplequest agreed to “design, construct and upfront the cost of a trunk storm sewer” through the Property, and of a road that would be built partly on the Property. The purpose of the contract – for Maplequest – was to allow it to develop its own lands on Farooq Boulevard. The Property is adjacent to (and includes portions of) Farooq Boulevard, and would therefore benefit from Maplequest’s construction. The contract specified the construction work that would take place and set out the division of construction costs. Cicchino agreed to pay $1,000,102, subject to various contingencies and adjustments.
[9] On June 22, 2016, Maplequest contracted with TACC Construction Ltd. (“TACC”) to do work that was the subject matter of the Cost Sharing Agreement on both the Maplequest Lands and on the Property (the “Construction Contract”). Cicchino was not a party to the Construction Contract; Maplequest was responsible to pay TACC under the Construction Contract.
[10] On November 13, 2017, Maplequest[^7] delivered to Cicchino a “Landowner to Landowner Claim”, attaching an invoice for $1,420,311, in respect to works completed by Maplequest pursuant to the Cost Sharing Agreement. When this account was rendered, Cicchino was in the midst of selling the Property to the respondents. That sale closed on November 30, 2017.
[11] The sale from Cicchino to the respondents was for a price of $58.5 million, of which $48 million took the form of a vendor take-back mortgage.
[12] On November 29, 2018, Maplequest registered a claim for lien against the Property in the amount of $1,604,951.40, for services stated in the claim for lien to have been provided to the Property from November 9, 2015 to November 29, 2018. Maplequest perfected its claim for lien by commencing an action and obtaining and registering a certificate of action against the Property. In the action, Maplequest also claimed in contract as against Cicchino.
[13] The respondents moved pursuant to s. 47 of the CLA to discharge the claim for lien.
Issues Below Not at Issue on Appeal
[14] Several issues were raised before the motions judge that are not pertinent to the appeal. The motions judge found that there were triable issues as to whether Maplequest was a “contractor” and whether Cicchino was an “owner” within the meaning of the CLA. These findings have not been appealed and are not pertinent to the issues on appeal.
Issues on Appeal
[15] The motions judge found that the contract work was completed by November 13, 2017, the date of the invoice from Maplequest to Cicchino. No further invoice was rendered, and the amount of the claim for lien is the amount of the 2017 invoice, plus HST.
[16] Maplequest raises the following issues on appeal:
a. Did the motion judge fail to consider, misapprehend and/or ignore the evidence in support of the appellant’s position that the time to register the claim for lien had not yet expired?
b. Did the motion judge make an error of mixed fact and law by relying on the date of the invoice to conclude that work was complete as of November 13, 2017?
c. Did the motion judge err in law by failing to apply the correct standard for a motion pursuant to s. 47 of the CLA?
Issue #1: Did the Motion Judge Make a Palpable and Overriding Error of Fact?
[17] The motion judge relied upon the invoice rendered on November 13, 2017. He compared the summary of costs attached to the invoice to the work described in the Cost Sharing Agreement. He found that the descriptions are co-extensive – that is – that the invoice was for all the work described in the Cost Sharing Agreement.
[18] Maplequest’s witness stated that the respondents requested that further work be done on the Property after November 2017, but did not produce a single document corroborating this assertion. Maplequest took the position that it continued to supply services and materials for road finishing, sidewalk and curb work on the Property after November 2017, but again produced no documentary evidence corroborating this claim. Maplequest did produce Payment Certificates referencing this kind of work, done after November 2017, but these Certificates do not say on which lands the work was done. We appreciate the practicalities: If finishing the road and the construction of sidewalks took place after November 2017, it could well have taken place on the Property. But this would be easily provable with direct evidence from TACC, with supporting documentation showing where the subsequent work was performed. These are substantial and sophisticated parties, and the motions judge was entitled to conclude, as he implicitly did, that in the absence of documentary evidence that should have been readily available to establish this point, an inference should be drawn that such evidence is not available.
[19] Aside from a bald assertion by a witness for Maplequest, there is no evidence any work was done on the Property after the invoice of November 2017. There is no invoice for any such work. There is no record of a request for such work. The invoice tendered in November 2017 appears to be co-extensive with the Cost-Sharing agreement, and appears to include the entire contract price for that agreement.
[20] Counsel pointed us to email exchanges between Maplequest’s agent and Lalu between February and May of 2018 on the subject of the Cost Sharing Agreement and money owing under it. None of these emails suggest that there is further work to be done. Rather, it appears to concern the unpaid invoice and discussions between Maplequest’s agent and Lalu about the unpaid invoice. There is no evidence that these discussions included discussions about further work to be done on the Property.
[21] The moving party established a prima facie case that the Cost Sharing Agreement was complete and fully invoiced as of November 2017. This is reflected in the invoice for the full amount, the covering letter from Maplequest’s agent that speaks of the work having been “completed”, and an absence of evidence of further work being done on the Property. This was a sufficient factual basis for the motions judge to conclude that the Cost Sharing Agreement work had been completed by November 2017; we see no palpable and overriding error.
Issue #2: Did the Motion Judge Make an Error of Mixed Fact and Law by Relying on the Invoice to Conclude that Work Was Complete by November 13, 2017?
[22] The appellant argues that the motions judge erred in deciding the issue on the basis of the invoice from November 2017. With respect, this argument cannot succeed – as argued before us, the appellant’s position on this issue is that invoices are somehow irrelevant, or carry no weight at all, in assessing the timing of work on a contract. That is not the law.
[23] It is clear law that an invoice, by itself, may not establish when work was completed. See Ken Tulloch Construction and Atlantic Construction[^8] on this point. The underlying question – for the court to answer – is whether the contract was completed. If a final invoice says that it is for the entire work and that the work has been completed, that is some evidence that the court may consider on the issue. In the absence of any other evidence, the invoice, by itself, may be sufficient to establish that the work was completed.
[24] Usually there will be more evidence, particularly if there is a serious contest as to whether the work was completed. In the case at bar, the motion judge did not rest his decision entirely on the invoice. He placed considerable weight on it and the covering letter that accompanied it, as he was entitled to do, but he weighed that evidence in light of all the other evidence that was before him. We see no palpable and overriding error.
Issue #3: Did the Motion Judge Apply the Wrong Standard for a s. 47 Motion?
[25] In our respectful view, the motions judge erred when he said that this motion was the same as a motion for summary judgment. It is analogous to such a motion – a point that has been made in the cases many times – and the underlying test – whether there is a triable issue in respect to any of the bases on which discharge of the lien is sought – is the correct test to apply. However, as this court has noted recently in R&V Construction v. Baradaran,[^9] a motion under s. 47 and a motion for summary judgment under the Rules are procedurally different things.
[26] In R&V Construction the distinction was important because of the issues of procedural fairness that were raised for a self-represented litigant when the Master used the enhanced powers on a motion for summary judgment on a Rule 47 motion – fairness issues that could have been addressed by following a fair process once the Master determined that the case could best be adjudicated by way of a motion for summary judgment.
[27] The motions judge did not have the benefit of R&V Construction and cannot be faulted for his characterization of the prior jurisprudence. No issue of procedural justice arises here and none was raised before us – indeed, R&V Construction was not argued before us. Although the motions judge stated that he was able to use the enhanced powers used on a motion for summary judgment, he did that in respect to other issues that were before him and not on the point at issue on this appeal. There was no need to use the enhanced powers for the motions judge to conclude as he did, and no procedural unfairness in the way in which the motion proceeded in any event.
[28] The parties are sophisticated. The construction work done here was performed by a substantial contractor. The absence of documentary evidence (a) showing a request for work to be done after November 2017; (b) showing any request for work by the respondents; (c) showing any billing for work done after November 2017; or (d) showing any work done on the Property after November 2017, in all the other circumstances of the case, is a sufficient basis for the motions judge to have concluded that the fully billed contract was completed by November 2017.
Disposition
[29] The appeal is dismissed with costs payable from the appellant to the respondents in the agreed amount of $11,225 inclusive.
D.L. Corbett J.
Emery J.
LeMay J.
Released: July 14, 2020
CITATION: Maplequest (Vaughan) Devels. Inc. v. 2603774 Ontario Inc., 2020 ONSC 4308
DIVISIONAL COURT FILE NO.:
DATE: 20200713
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
D.L. Corbett, Emery and LeMay JJ.
BETWEEN:
MAPLEQUEST (VAUGHAN) DEVELOPMENTS INC. Appellant
- and -
2603774 ONTARIO INC. and LALU CANADA INC. Respondents
REASONS FOR DECISION
D.L. Corbett J.
Released: July 14, 2020
[^1]: Construction Lien Act, R.S.O. 1990, c. C.30, s.47. [^2]: HMI Construction Inc. v. Index Energy Mills Road Corp., 2017 ONSC 4075, 81 C.L.R. (4th) 88, at paras. 3-4. [^3]: CLA, s.71(1). [^4]: Housen v. Nikolaisen, 2002 SCC 33. [^5]: The court was advised that a sale of the property is scheduled to close on July 15, 2020. Given that we concluded at the end of oral argument that the appeal should be dismissed, we advised that we would release our reasons the day following oral argument. [^6]: Lalu entered the agreement of purchase and sale to buy the lands, but then assigned its interest to the respondent numbered company, which is wholly owned by Lalu. I refer to both companies as the “respondents” in this decision, since nothing in this appeal turns on distinguishing them. [^7]: This communication came from Maplequest’s agent, SCS Consulting Group Ltd., on behalf of Maplequest. [^8]: 2018 ONSC 2071, 91 C.L.R. (4th) 121, at para. 19. [^9]: 2020 ONSC 3111 (Div. Ct.).