Court of Appeal for Ontario

Citation: Balmoral Custom Homes Ltd. v. Biggar, 2016 ONCA 967

Date: 2016-12-21

Docket: C62221

Before: Cronk, Juriansz and Roberts JJ.A.

Between:

Balmoral Custom Homes Ltd. Plaintiff (Respondent)

and

Mary Louise Biggar Defendant (Appellant)

Counsel: Marvin J. Huberman, for the appellant Neal H. Roth, for the respondent

Heard: December 16, 2016

On appeal from the order of Justice Wendy Matheson of the Superior Court of Justice, dated May 11, 2016, confirming the Report of Master Carol Albert, dated January 14, 2016.

Endorsement

[1] The appellant appeals from the motion judge’s confirmation of the master’s report allowing the respondent’s action and dismissing the appellant’s counterclaim.

[2] The respondent was retained by the appellant pursuant to a fixed price contract to carry out renovations and an addition to her home. When the scope of the construction project grew, the parties agreed on fixed prices for each of the extra items of work to be performed. Their relationship broke down and the respondent brought an action, claiming that the amount of $108,554.34 was owing under their contract. Following a hearing for directions and a trial by way of a reference, the master found that the respondent was entitled to payment of the reduced amount of $94,031.36, plus interest, for its services and materials rendered to the appellant, dismissed the appellant’s counterclaim in the amount of $69,580.69 for alleged misrepresentations, overpayments, deficiencies and completion costs, and awarded costs to the respondent in the amount of $69,561.45.

[3] The appellant submits that the motion judge erred in confirming the master’s report. As argued, she advances two arguments on appeal.

[4] First, she submits that the motion judge erred by finding that the master provided cogent reasons for her decision. In particular, the appellant says, the master failed in her reasons to deal with the appellant’s allegations that the respondent had made post-contractual misrepresentations about its billing for the extra work agreed upon by the parties; and that the respondent had breached its duty of honesty in carrying out its contract with the respondent by lying to the appellant about extra charges and dishonestly inflating its billings for the extra work performed.

[5] Second, she submits that the motion judge erred in finding that the entire agreement clause in the parties’ contract disposed of any claim regarding the respondent’s alleged post-contractual misrepresentations and breach of its overriding duty of honesty. The appellant concedes that this clause excludes her allegations of prior misrepresentations, as the motion judge found.

[6] We do not accept these submissions.

[7] The appellant does not take issue with any of the master’s factual findings. As the motion judge noted, in the master’s very careful and thorough reasons, she disposed of all the parties’ allegations of contractual breaches, including the deficiencies, overpayments and completion costs claimed by the appellant in her statement of defence and counterclaim. Specifically, for the reasons explained in her report, the master preferred the respondent’s evidence over the appellant’s evidence, and found that the appellant had agreed to the charges for the extra work to be completed when the construction project grew, as well as the $5,100.00 for electrical work, which she now impugns as dishonest charges. The appellant’s post-contractual misrepresentation claim and allegations of breaches of the respondent’s contractual duty of honesty dissolve in the face of the master’s explicit findings on the contested items said to be relevant to those claims.

[8] With respect to the contractual interpretation issues, we agree with the appellant’s submissions that the particular wording of the entire agreement clause of this contract does not exclude a claim based on any post-contractual misrepresentations. Nor does it exclude the parties’ duty of honesty not to lie or otherwise knowingly mislead each other about matters directly linked to the performance of the contract; this duty operates as a general doctrine of contract law, like unconscionability, that applies to the parties’ contract and that the parties are not free to exclude: Bhasin v. Hrynew, 2014 SCC 71, at paras. 73-75.

[9] While the master did not explicitly address these issues in her reasons, this case was presented in terms of the alleged deficiencies, overpayments and completion costs, to which the appellant’s allegations of post-contractual misrepresentations and breach of the respondent’s duty of honesty were tied. The master dealt with these claims as they were advanced at trial. As a result, the master’s comprehensive findings on these issues, specifically, that the parties had agreed to these charges, disposes of the factual underpinnings of the appellant’s claim for set-off and counterclaim. As the master found, having agreed to the charges in question, the appellant complains after the fact that the respondent overcharged for the extra work performed and that she had the right to choose the price for each extra. There was no evidence that the parties agreed to any specific mark-up on the extra work or that the respondent had lied; the contract did not entitle the appellant to know the respondent’s pricing structure. The master did not agree with the appellant’s position. We see no basis to interfere.

[10] For these reasons, the appeal is dismissed.

[11] The parties have agreed that the respondent is entitled to its partial indemnity costs of the appeal, in the amount of $8,000.00, inclusive of disbursements and all applicable taxes, and we so order.

“E.A. Cronk J.A.”

“R.G. Juriansz J.A.”

“L.B. Roberts J.A.”