CITATION: Blackstone Paving and Construction Ltd. v. Barrie (City of), 2024 ONSC 4556
DIVISIONAL COURT FILE NO.: DC-23-1374
(Oshawa) DATE: 20240823
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
D.L. Corbett, McGee and Ryan Bell JJ.
BETWEEN:
BLACKSTONE PAVING AND
Jonathan L. Frustraglio, for the
CONSTRUCTION LTD.
Applicant
Applicant
– and –
THE CORPORATION OF THE CITY
Ebaadh Rizwani, for the Respondent
OF BARRIE
Respondent
HEARD at Oshawa: January 22, 2024
REASONS FOR DECISION
D.L. Corbett J.
[1] The Applicant seeks judicial review of the determinations of Adjudicator Matt Ainley dated November 10, 2022 (ODACC File 5274) and Adjudicator Ali-Sina Ardakani dated November 16, 2022 (ODACC File 5275), pursuant to leave granted by this court on March 10, 2023 (2023 ONSC 1508).
Jurisdiction of this Court
[2] The impugned decisions are prompt payment adjudications pursuant to the Construction Act. There is no appeal from these decisions, and judicial review to this court is only available with leave: Construction Act, s. 13.18(1). This court’s jurisdiction to grant judicial review is circumscribed by s. 13.18(5) of the Act, and the only basis for review upon which the applicant relies in this application states as follows (s.13.18(5)5):
The determination of an adjudicator may only be set aside on an application for judicial review is the applicant establishes one or more of the following grounds:
- The procedures followed in the adjudication did not accord with the procedures to which the adjudication was subject under this Part, and the failure to accord prejudiced the applicant’s right to a fair adjudication.
Standard of Review
[3] The statutory test for procedural fairness is conjunctive, and is set out in s.13.18(5) of the Act:
a. The first question is whether the procedures followed in the adjudication accord with the procedures to which the adjudication was subject under the applicable Part of the Act.
b. If the answer to this question is “no” then the second question is whether the failure to follow the prescribed procedures prejudiced the applicant’s right to a fair adjudication.
[4] The standard of review for questions of procedural fairness is “fairness” or “correctness” (see Law Society of Saskatchewan v. Abrametz, 2022 SCC 29). Findings of fact are reviewed on a standard of reasonableness, and this principle applies to factual findings related to procedural fairness issues. However, the requirements of procedural fairness, in light of the facts, as found, are assessed on a “correctness” or “fairness” standard, applying the statutory test set out in s.13.18(5) of the Act.
The Issues
[5] Blackstone submits that Barrie improperly raised issues and arguments in its written submissions to the Adjudicators. It submits that Barrie was required to identify all of its reasons for refusing payment in its Notices of Non-Payment pursuant to s.6.4(2) of the Act. It submits that the Notices were vitiated by acknowledged typographical errors, and that Barrie raised reasons for non-payment in the adjudication that had not been set out in the Notices.
[6] Blackstone submits that Barrie’s non-compliance with s.6.4(2) was procedurally unfair because, when Blackstone sought to address new issues raised by Barrie in its responding materials, both Adjudicators refused to permit Blackstone’s request to deliver reply submissions, and thus Blackstone never had an opportunity to respond to the new issues.
Analysis
(a) Context
[7] The issues raised by Blackstone arise in the context of ongoing payment disputes respecting Blackstone’s accounts: decision of Adjudicator Kantor, dated July 28, 2022 and decision of Adjudicator Pepper dated October 18, 2022 (both in respect to invoices #21-181 and 22-701), decision of Adjudicator Ardakani dated November 16, 2022 (in respect to invoice #22-703) and decision of Adjudicator Ainley dated November 10, 2022 (in respect to invoice #22-704). The latter two determinations are the subject matter of this application.
(b) The Typographical Errors
[8] Blackstone argues that the Act’s requirements should be construed strictly, and that typographical errors in the City’s Notice of Non-Payment vitiate that document. At para. 9 of Adjudicator Ainley’s decision, he found that the City’s Notice complied with the Act, a conclusion driven by the Adjudicator’s findings of fact. I see no basis on which to interfere with these findings. Further, even if it was thought that typographical errors amounted to non-compliance with s.6.4(2) of the Act, Blackstone has not established any prejudice arising from this non-compliance. I would not give effect to Blackstone’s argument respecting typographical errors.
(c) Failure to Identify all Reasons for Non-Payment in the Notices of Non-Payment
[9] The Act, s.6.4(2) expressly requires that a Notice of Non-Payment “[detail] all of the reasons for non-payment”. Blackstone argues that the City’s Notices of Non-Payment did not include “all of the reasons for non-payment”, and specifically did not “detail” the City’s claims for set-off and liquidated damages. These “undetailed” claims were the principal basis upon which the adjudications were decided against Blackstone.
[10] In its submissions, Barrie does not agree that it raised issues in the adjudication that had not been set out in the Notices of Non-Payment. Rather, it argues that it provided “elaborations” of the reasons it had given in its Notices of Non-Payment. Neither Adjudicator expressly resolved the issue of whether Barrie raised “additional” reasons or merely “elaborated” on its reasons for non-payment in its adjudication submissions. However, it is apparent that both Adjudicators implicitly accepted Barrie’s characterization that it did no more than “elaborate” the reasons it gave for non-payment in the Notices of Non-Payment.
[11] I am satisfied that the Adjudicators’ implicit findings on this issue were available on the records before the Adjudicators. Given the numerous technical and procedural objections raised by Blackstone, I would not fault the Adjudicators for dealing with this particular issue in the manner that they did: issues of set-off and charge-backs were clearly raised in the Notices of Non-Payment and were addressed by Blackstone in its submissions.
[12] Accordingly, I would defer to the findings of the Adjudicators that the Notices of Non-Payment were not in breach of s.6.4(2) of the Act and did raise all the reasons for non-payment relied on by Barrie. It follows that Blackstone has not met the first branch of the conjunctive statutory test for procedural unfairness prescribed by s.13.18(5)5 of the Act.
(d) Declining to Receive Reply Submissions
[13] The Act does not provide for reply submissions. Both before Adjudicator Ardakani and Adjudicator Ainley, the parties agreed on a process for exchange of adjudication materials. No provision was made for reply submissions. Each Adjudicator received a written request from Blackstone seeking to make reply submissions, both said they would take the request under advisement, and both later advised that they did not need reply submissions to dispose of the adjudications. In so doing, the Adjudicators noted that many of the concerns grounding the request to make reply submissions were in respect to issues that were not properly before the Adjudicators for determination. See, for example, the reasons of Adjudicator Ardakani at p. 32.
[14] The Adjudicators’ decisions not to permit reply submissions are not inconsistent with the process prescribed by the Act or with the process agreed by the parties with the Adjudicators. Therefore, it follows, again, that Blackstone has not met the first branch of the conjunctive statutory test for procedural unfairness prescribed by s.13.18(5)5 of the Act.
Conclusion and Disposition
[15] I would dismiss the application for judicial review, with costs of the application and the leave motion payable within thirty days by Blackstone to Barrie of $7,500.00, in the aggregate.
“D. L. Corbett J.”
“McGee J.”
“Ryan Bell J.”
Date of Release: August 23, 2024
CITATION: Blackstone Paving and Construction Ltd. v. Barrie (City of), 2024 ONSC 4556
DIVISIONAL COURT FILE NO.: DC-23-1374
(Oshawa) DATE: 20240823
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
D.L. Corbett, McGee and Ryan Bell JJ.
BETWEEN:
Blackstone Paving & Construction Ltd.
Applicant
– and –
The Corporation of the City of Barrie
Respondent
REASONS FOR DECISION
D.L. Corbett J.
Date of Release: August 23, 2024