Court of Appeal for Ontario

Citation: 2014 ONCA 651 Date: 20140924 Docket: C58292

Before: Simmons, Rouleau and Hourigan JJ.A.

Parties

BETWEEN

McNally Construction Inc. Plaintiff

and

The Hamilton Port Authority Defendant (Appellant)

and

Golder Associates Ltd. Third Party (Respondent)

and

Mar-Land Engineering Limited Fourth Party

Counsel and Hearing

Mark Abradjian and Renata Kis, for the appellant P. John Brunner, for the respondent

Heard: September 17, 2014

On appeal from the order of Justice Dale Parayeski of the Superior Court of Justice, dated December 30, 2013, with reasons reported at 2014 ONSC 1180.

Reasons for Decision

By the Court:

[1] On a motion for summary judgment brought by the third party, Golder Associates Ltd., against the defendant, The Hamilton Port Authority, the motion judge dismissed the Port Authority’s claim for contribution and indemnity against Golder.

[2] In reaching his decision, the motion judge found that the plaintiff and plaintiff’s counsel had made formal and informal admissions at examinations for discovery and at the hearing of the summary judgment motion that conclusively established that the plaintiff had no claim against Golder.

[3] The Port Authority does not dispute that its third-party claim for contribution and indemnity against Golder can only succeed if the plaintiff has a viable cause of action against Golder.

[4] However, the Port Authority submits that the motion judge erred in relying on the plaintiff’s counsel’s alleged admissions at the summary judgment motion hearing when, among other things, any such admissions were not in evidence, were qualified and, in any event, were contrary to the plaintiff’s pleadings.

[5] We agree. At para. 7 of his reasons, the motion judge described the statement of plaintiff’s counsel on which he relied:

In addition, at the motion before me, counsel for the plaintiff confirmed on the record that the plaintiff takes no issue with the location of the bore holes dug by [Golder].

[6] The statements of plaintiff’s counsel at the motion hearing on which the motion judge relied read as follows:

Counsel for the Plaintiff: … [W]hat I can do is say to you again I’ve just simply taken the page from the transcript … where [counsel for Golder] says:

So … I take it … that [the plaintiff] accepts that there was, there were no representations in the Golder Report of June ’07, the preliminary geo-technical evaluation, which was either false, inaccurate or misleading?…

[Counsel for Golder]: You have no facts or evidence to suggest otherwise?

Counsel for the Plaintiff: My client’s position may be at trial that there was nothing that they know of that was negligent in the way in which Golder prepared this report.

The Court: I’m going to ask a much more direct question and if you can’t answer it I respect that.… Does the phraseology in that [discovery] transcript that talks about nothing misleading, nothing inaccurate, does that or does that not encompass location of the bore holes?

Counsel for the Plaintiff: I think it does encompass location because the larger context of what the parties understood was, and the evidence will have to bear itself out but the decision making process as to where the locations were for bore holes were initially those of Mr. McFarland who …

The Court: From the fourth party.

Counsel for the Plaintiff: From the fourth party but who was, we say, a representative of [the Port Authority], so it was [the Port Authority’s] decision where to put bore holes. We heard at examinations for discovery that it was open to Golder to make a suggestion as to where bore holes might be and in fact at an adjacent pier they apparently made some suggestions. Beyond that we also heard that there was a decision about costs associated with going out into the water and that would have presumably had some governing effect on do we spend the extra money to provide those bore holes. Beyond that my client who was not part of the process, appreciate, they come on after the fact, get the information. They know nothing more than what they heard at discovery so we know of no negligence by Golder in any decision making process.... [Emphasis added.]

[7] Assuming, without deciding, that an admission made by plaintiff’s counsel at the hearing of Golder’s summary judgment motion against the Port Authority would be binding on the plaintiff at trial, we are not satisfied that plaintiff’s counsel’s comments were capable of constituting an admission that the plaintiff did not have a claim against Golder.

[8] Central to the plaintiff’s claim is the decision taken as to where the test holes would be bored and the role, if any, that Golder played. The key statement by plaintiff’s counsel at the summary judgment motion related to the location of bore holes was that “I think” that a prior statement made by a representative of his client on discovery “encompass[ed the] location” of the bore holes. Plaintiff’s counsel added that “the evidence [would] have to bear itself out”.

[9] The qualifications that plaintiff’s counsel made do not support the motion judge’s statement that counsel had “confirmed … that the plaintiff takes no issue with the location of the bore holes”. In fact, the plaintiff maintains its plea in its statement of claim that, in effect, it relied on the representations made in the Golder report and that, either alone or taken together with the balance of the tender documents, the representations were inaccurate and negligently made. In our view, the motion judge’s finding is a palpable and overriding error. His subsequent conclusion, at para. 11 of his reasons, that the plaintiff has no claim against Golder based on the plaintiff’s admissions is tainted by this error and cannot stand.

[10] Although plaintiff’s counsel acknowledged at the motion hearing that the plaintiff did not, at that stage, have any evidence of a claim against Golder, plaintiff’s counsel’s remarks did not exclude the possibility that such a claim would be made out at trial on the whole of the evidence.

[11] The respondent argued that, even if we agreed with the appellant’s submission, we should nonetheless dismiss the appeal. This is because the third party claim was issued more than one year after Golder had substantially completed its work. The contract between the appellant and Golder has a one-year limitation clause that serves to bar the third party claim.

[12] Although the limitation defence was raised in the court below, the motion judge did not consider it as he dismissed the third party claim on other grounds. In our view, this court should not rule on the issue as part of this appeal. The appellant has raised questions as to whether the limitation period has run and whether it applies to claims for contribution and indemnity. The limitation issue is therefore best left to be resolved at trial.

[13] As a result, we allow the appeal and set aside the motion judge’s dismissal of the third and fourth party claims.

[14] The parties have agreed that the successful party should be awarded costs fixed in the amount of $10,000 plus disbursements and HST. We agree and award the appellant costs in that amount.

“Janet Simmons J.A.”

“Paul Rouleau J.A.”

“C.W. Hourigan J.A.”