DATE: 20030416

DOCKET: C36114

COURT OF APPEAL FOR ONTARIO

RE: GEORGE ROBSON CONSTRUCTION (WESTON) LIMITED and CANADIAN MICROTUNNELLING LTD. (Plaintiffs (Respondents)) – and – CITY OF HAMILTON (Defendant (Appellant))

BEFORE: LASKIN, CRONK and ARMSTRONG JJ.A.

COUNSEL: Paul N. Feldman and Bruce A. Simpson, for the respondents

Gary Kuzyk and Paul F. Ryan, for the appellant

HEARD: March 31, 2003

On appeal from the judgment of Justice N. Dyson of the Superior Court of Justice dated February 28, 2001.

E N D O R S E M E N T

[1] We are all of the view that the trial judge failed to address the principal issue in this case. The trial judge failed to consider the effect of the exclusion clauses in the contract on Robson’s bid, given the timing of the representation made by the City. The trial judge found that the representation made by the City’s project engineer was to the effect that the sewer contract could be satisfied by using a steel liner rather than a concrete liner, as called for in the contract specifications. This representation was made before the contractor tendered its bid. However, when it tendered its bid, it did so in response to the City’s requirement for a concrete liner. It was several weeks later before the contractor raised the issue that it intended to proceed with a steel liner, which set off a chain of events that led to the City terminating the contract. The legal effect of that chronology, about which we come to no conclusion, was not addressed by the trial judge in his reasons. Accordingly, with regret, we conclude that there must be a new trial so that a judge may consider this issue and the other issues in the context of all the evidence.

[1] The contractor cross-appealed on damages and requested that we increase the award of $221,758.73 to $310,928.44 and requested $250,000 for punitive and exemplary damages. We are unable to understand the basis upon which the trial judge assessed damages at $221,758.73. This quantum was not sought by the contractor nor was it suggested by the City. Since there must be a new trial, it is unnecessary to say anything further about damages.

[2] Finally, we are of the view that the trial judge erred in making an order for costs on a solicitor/client basis without requesting or hearing any submissions on the issue.

[3] In the result, the judgment below is set aside and a new trial is ordered.

[4] In regard to costs, the City of Hamilton is entitled to its costs on a partial indemnity basis. The total amount claimed by the City is $40,562.95 which is calculated in accordance with the costs grid. The claim includes preparation and counsel fees for two counsel – each with over 20 years experience. In our view, the contractor ought not to be required to pay for two senior counsel. Also, given the amount in issue and the degree of complexity of the case, the amount sought by the appellant is excessive. This was a relatively straight-forward contract claim. We therefore fix the City’s costs at $18,000 inclusive of disbursements and GST.

“John Laskin J.A.”

“E. A. Cronk J.A.”

“Robert P. Armstrong J.A.”