COURT FILE NO.: 218/06
DATE: 20081120
SUPERIOR COURT OF JUSTICE - ONTARIO
(DIVISIONAL COURT)
RE: BERNARD SHERMAN and HONEY SHERMAN v. 21 dEGREE hEATING AND AIR CONDITIONING INC., WALTER KENYON et al
BEFORE: Swinton, Hennessy, & Karakatsanis JJ.
COUNSEL: Jack Fitch, Lester Scheininger, for the Appellants
Marco Drudi, for the Respondent, 21 Degrees Heating and Air Conditioning Inc.
Walter Kenyon, acting in person
HEARD AT TORONTO: November 17, 2008
E N D O R S E M E N T
[1] This is an appeal to the Divisional Court from the decision of T. Ducharme J. dated March 20, 2006, dismissing the plaintiffs’ claim. Although the Statement of Claim initially sought damages of $500,000, at trial the plaintiffs sought special damages of $33,971.42 and an unspecified amount of general damages. The trial judge found the defendant 21 Degrees liable for breach of contract and both 21 Degrees and Kenyon liable for negligence. The trial judge found the plaintiffs had failed to prove damages. The appellants ask that judgment be set aside and request that judgment be granted in their favour, awarding damages in the amount of $28,971.42 for out-of-pocket expenses and an amount fixed by this Court for general and/or nominal damages.
Jurisdiction
[2] The Notice of Appeal is dated April 2006 and the time to file was extended to June 2006.
[3] The Divisional Court has jurisdiction to hear appeals filed before October 1, 2007 but only regarding amounts under $25,000, pursuant to s. 19(1)(a) and (1.1) of the Courts of Justice Act, R.S.O. 1990, c. C.43:
- (1) An appeal lies to the Divisional Court from,
(a) a final order of a judge of the Superior Court of Justice, as described in subsections (1.1) and (1.2)…
- (1.1) If the notice of appeal is filed before …[October 1, 2007], clause (1) (a) applies in respect of a final order,
(a) for a single payment of not more than $25,000, exclusive of costs;
(b) for periodic payments that amount to not more than $25,000, exclusive of costs in the 12 months commencing on the date the first payment is due under the order;
(c) dismissing a claim for an amount that is not more than the amount set out in clause (a) or (b); or
(d) dismissing a claim for an amount that is more than the amount set out in clause (a) or (b) and in respect of which the judge or jury indicates that if the claim had been allowed the amount awarded would have been not more than the amount set out in clause (a) or (b).
[4] The Divisional Court has no jurisdiction to hear this appeal under s. 19(1.1)(c) as the trial judge dismissed a claim that was for an amount greater than $25,000 for special damages (apart from any claim for general damages). The appellants argue however that this Court has jurisdiction under s. 19(1.1)(d) because the trial judge in effect indicated that if the claim had been allowed, the amount awarded would have been zero. In this case, the trial judge found liability but found that damages were either not proven or not caused by the breach of contract or negligence of the defendants.
[5] Paragraph (d) in s.19(1.1) addresses the case where the amount of the claim may be much larger than $25,000, but the trial judge or jury indicates that the award would have been less than $25,000 if the claim had been allowed. This would clearly permit an appeal to the Divisional Court where the court finds no liability or some other reason not to award damages that are otherwise proven or assessed at less than $25,000. However, the language of this subsection simply does not fit this case where the claim is dismissed because damages have not been proven. A finding that either the damages claimed have not been proven or that the damages claimed were not caused by the defendant's negligence is not the equivalent of an ‘award’ of $0. The interpretation urged by the appellants would result in appeals to the Divisional Court in all cases where a trial judge dismisses a claim for lack of sufficient proof of damages, notwithstanding the size of the amount in dispute.
[6] The purpose of section 19(1.1) is to direct appeals to the Divisional Court where realistically the amount in dispute between the parties is $25,000 or less. Although the Divisional Court may allow the appeal and grant judgment in an amount exceeding $25,000, there is no question that the legislation intends that cases involving a larger amount must be appealed to the Court of Appeal.
[7] In our view, where the trial judge dismisses a claim for special damages because they have not been proven, either due to insufficient evidence to establish the loss or the failure to establish causation, subsection s. 19(1.1)(c) governs and subsection s. 19(1.1)(d) does not apply to establish this court’s jurisdiction.
[8] We therefore find the Divisional Court has no jurisdiction and we quash this appeal.
The merits
[9] Because we reserved on the issue of jurisdiction, we heard full argument on the merits. Even if we are wrong and have jurisdiction to hear this appeal we would dismiss it. We find there to be no merit to this appeal.
[10] The plaintiffs sued for damages arising from problems in the design and construction of their home. After settlement was reached with other defendants, the only issue before the trial judge related to the design of the HVAC system in the plaintiffs’ home. It was not disputed that there were and continue to be serious problems with the cooling of the home.
[11] The trial judge found the defendants negligent because the HVAC design did not provide for sufficient cooling capacity, failing to take into account the large skylight and open area beneath it. He found that as a result, the design was short a maximum of 3.5 tonnes of cooling capacity. The trial judge did not find that the design negligently failed to consider whether the windows were tinted. There was ample evidence to support the trial judge’s findings with respect to the negligence involved, including the evidence of the appellants’ expert.
[12] The additional cooling capacity to rectify the deficiency in the design was added to the home around June 1991, a few months after the plaintiffs moved in. The cooling problems continued and the trial judge found that there were other more significant contributing factors to the cooling problems, independent of any inadequacy in the design. There was ample evidence to support the trial judge’s findings relating to the issue of causation.
[13] The trial judge correctly articulated the law that the plaintiffs were required to satisfy the court that they had suffered loss on a balance of probabilities. With respect to proof of claims, in finding there was insufficient proof of loss, the trial judge referred to the hold-back provisions. It may be the trial judge erred in his understanding of the hold-back provisions. However, he also made specific findings of fact that Mr. Sherman did not have personal knowledge as to whether the invoices were paid by the contractor, or that the cost of specific invoices had in fact been passed onto him. It was open to the trial judge to make such findings upon the evidence and his assessment of the viva voce evidence.
[14] With respect to the majority of the plaintiffs’ specific claims, the trial judge was not satisfied that the expenditures claimed were required as a result of negligence in the design of the HVAC, nor that there was any increased cost resulting from installing additional capacity at a point in time later than the original installation. The trial judge found that the tinting of windows many years later was not related to the negligence as found. The trial judge further found that the negligence in the design was only one factor that contributed to the cooling problem of the home and that this problem should have been resolved in June 1991 with the addition of a further cooling unit. He found that there were balancing problems identified in various balancing reports suggesting that the HVAC system was not working properly in terms of air distribution. There was evidence to support these findings.
[15] Given the trial judge’s findings on causation, he was entitled to find that the plaintiffs had not provided adequate evidence to justify an award of general damages. It is not evident that the plaintiffs claimed nominal damages at trial. In any event, there is nothing in the conduct of the respondents that would justify an award of nominal damages.
[16] We do not find the trial judge made errors of law or any palpable and overriding errors of fact. As a result, if we are wrong in our determination regarding jurisdiction, we would dismiss the appeal.
[17] The appeal is quashed. As agreed between the parties, the defendant 21 Degrees shall have its costs in the amount of $19,000.
Swinton J.
Hennessy J.
Karakatsanis J.
DATE: