COURT FILE NO.: CV-08-CT056666-0000

DATE: 20120710

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

Jason BRUMLEY and 1656679 ONTARIO LTD.

Plaintiffs

– and –

CONSUELO BONILLA

Defendant

Robert G. Zochodne, for the Plaintiffs

Consuelo Bonilla, in person

HEARD: April 4, 5, 6, 7, 8, 11, 12, 13, 14, 15, 18, 19, 20 and 21, 2011 and by subsequent written submissions in May, November and December 2011

Stinson J.

[1] This lawsuit involves a dispute arising from a house renovation. The plaintiff contractor asserts that he was wrongly discharged and prevented from completing his contracted work. He sues for approximately $17,000 for unpaid services. The defendant owner-renovator (who was redeveloping the property for resale) asserts that the plaintiff overcharged, double billed, failed to complete contracted work and performed other work deficiently. In addition to defending the plaintiff's claim, she counterclaims for approximately $90,000. The case involves issues of credibility, contract interpretation and accounting.

background

[2] The plaintiff Jason Brumley is a carpenter by training and a house builder. He is the owner and operator of the corporate plaintiff. For purposes of this litigation they were treated indivisibly.

[3] The defendant Consuelo Bonilla carries on business as a renovator, designer and manager of house renovation projects. She, too, operates through a corporate presence. For purposes of the present litigation her personal and corporate presence were indivisible, as well.

[4] Since this case involves both a claim and a counterclaim, for ease of reference I will refer to the parties by their surnames throughout.

[5] Before the project that led to the present dispute, Brumley had worked for Bonilla on a house construction project in Toronto. She was impressed by his work and, in particular, his ability to construct a cathedral ceiling at that project.

[6] In February 2007, Bonilla purchased a property located at 169 King Edward Avenue in Toronto. This property is a narrow (less than fifteen feet) residential lot. At the time, it contained a single storey bungalow. Bonilla then began to plan an extensive renovation of the house to include, among other things, a second storey addition.

[7] Although she is not a licensed Ontario architect herself, Bonilla has the skills to prepare the kind of architectural drawings required for a renovation such as this. Due to the nature of the structural work contemplated, however, it was necessary for her to retain a structural engineering firm (Tabcom) to prepare structural plans and drawings.

[8] In turn, Bonilla submitted her plans and drawings and those of Tabcom to the City of Toronto Building Department, for review and approval. In due course, with some required amendments, approval was forthcoming.

[9] In the meanwhile, Bonilla took various other necessary steps to carry out the renovation project. She arranged construction financing. She decided to act as her own general contractor, and sought out qualified trades to perform the work.

[10] By reason of her previous experience with Brumley, Bonilla invited Brumley to quote on the demolition and structural framing work on the project. In due course, they signed a contract for this work. I should note that there is a dispute between them as to the scope of the work included as part of Brumley's responsibilities, both as to demolition and framing work.

[11] One of the issues between the parties concerns the extent of the contemplated demolition work at the time the contract was signed. The drawings that were provided by Bonilla to Brumley included a demolition drawing. As drafted, that drawing indicated removal of certain interior walls only.

[12] Bonilla's initial plan contemplated the addition of a short (seven foot) extension at the rear of the house, and the construction of the second storey above that and part of the existing rear portion of the house. She wrongly assumed that the floor of the rear portion of the house had been built as slab on grade construction, and she initially planned that the ground floor of the extension would be built as slab on grade construction, as well. After the excavation had been carried out for the slab on grade for the extension, it was discovered that the floor of the rear portion of the existing building was not constructed as slab on grade: indeed, the floor of the rear portion of the existing house was mainly supported by individual posts, similar to a deck. Bonilla's plans therefore changed.

[13] Bonilla's revised plans deleted the slab on grade and instead provided for a new crawlspace under the entire for the entire rear portion of the building. As well, the planned new south wall on the rear half of the building was relocated to become a straight line from the front to the rear of the building.

[14] Subsequent to the construction of the concrete footings and new concrete block foundation around the rear half of the building, Bonilla's plans changed again. She decided to convert the crawlspace to a full basement. There is a dispute between the parties whether additional excavation was required as a result of this change.

[15] The signed contract between the parties contemplated written change orders when there were modifications to the work. There is a dispute between the parties whether proper change orders were prepared and whether Bonilla authorized certain additional work by Brumley.

[16] Brumley invoiced Bonilla as the project progressed. When making payments, Bonilla deducted holdbacks and made her own calculations as to the extent of the work performed and the amount owed. Each of the parties kept separate accounting records, not all of which are complete. There is a dispute whether all invoices relied upon by Brumley were actually submitted to Bonilla. For her part, Bonilla prepared certain handwritten records, which Brumley denies were agreed-upon invoices. Brumley also asserts that Bonilla failed to make all payments on a timely basis and further that she ran into financial difficulties, a fact denied by Bonilla.

[17] There is no dispute between the parties that the work carried out by Brumley took longer than was originally anticipated. There is a dispute as to why it took as long as it did. Ultimately, in early April 2008 Bonilla issued a cheque for part of Brumley's work. She later told him not to deposit it, complaining that he had double billed her. She further complained that he had failed to perform on time and that there were shortcomings or deficiencies in his work. She terminated their contract. Based on his calculations at the time, Brumley believed that Bonilla owed him approximately $17,000, and he registered a construction lien against her property to secure that indebtedness. The lien was subsequently discharged when Bonilla provided security for it. She retained other contractors to complete what she says was Brumley's incomplete and/or deficient work.

[18] Brumley commenced this action claiming $17,000 as the amount due. In addition to defending the claim made against her, Bonilla counterclaimed for damages of approximately $90,000, comprised of the cost of delay, the financial loss due to the lien, the loss of the commercial value of the house due to alleged deficiencies, the cost of waterproofing, cleaning and wasted material.

issues and analysis

1. Assessment of the evidence

[19] In any civil case involving a dispute regarding past events – what occurred, why, and what the parties did – the trial judge is required to make findings of fact. Based on the oral testimony and the exhibits, the trial judge must decide what evidence to accept or reject, and arrive at his or her own conclusions as to what actually happened.

[20] In performing this function, the trial judge must rely on the parties to present the evidence, including the documentary record, as they choose. The level of difficulty of the task of presenting the evidence is usually a function of the level of clarity or organization of the underlying records and information. Unfortunately, in this case the underlying material largely lacked proper organization, with the result that it was difficult for the parties to present it in a cohesive fashion.

[21] A prime example of this is the state of accounts between the parties. Despite the fact that this was a relatively small (in dollar terms) construction project, the paper record of the dealings between the parties is anything but straight forward. Brumley's accounting system and records were not well organized or maintained, perhaps a reflection of the fact that his was a small operation. At the same time, Bonilla's payment practices, in particular her approach of making handwritten changes to invoices submitted to reflect her view of what should be paid, and of making partial payments based on her own deductions and calculations, were also very difficult to follow. This is perhaps due to her belief as to the scope of work she believed was complete and what she should pay for it.

[22] This was not a project in which there was a formal practice of a third party engineer or architect inspecting and certifying progress, so that draws could be paid based on percentage of completion. Rather, payments were to be made upon the attainment of specific milestones. As a result, each side had its own perspective as to the extent of completion, and each side invoiced or paid accordingly. When they disagreed, Bonilla performed her own calculations, often on the face of Brumley's invoice. The result was considerable confusion concerning the calculation and application of the payments she made.

[23] A further complication was the ever-evolving scope of the project. It is not uncommon in renovations of older houses to uncover or discover conditions that require changes to be made in the scope of work. This was certainly true in the present case. A prime example was the discovery that the floor at the rear of the original house was not the assumed slab on grade construction. This led to a change of the plans to incorporate a full new crawlspace. Subsequently, Bonilla decided to convert the crawlspace to a full basement. These and other alterations to the project as it had been originally planned resulted in changes to the work required, the manner in which it was carried out, and the time it took to perform it.

[24] Unfortunately, as with the case of the accounting records produced by each side, the documentary record relating to the scope of the work requested and agreed to be performed and paid for is far from complete. What records there are are frequently unclear and confusing. One example is the multiple versions and copies of the various, evolving plans for the work.

[25] As a result of these various problems, the documentary record in this case is at times confusing and at other times nearly impossible to decipher and properly understand. Although the witnesses referred to numerous documents, the underlying or preexisting problems with the documents were such that their explanations were sometimes difficult to follow or reconcile, and at times simply did not make sense.

[26] In the final analysis, a trial judge's findings of fact must be based upon the evidence, be it oral testimony or the documentary exhibits, bearing in mind which party has the burden of establishing a particular proposition. Those findings of fact are made on a balance of probabilities, that is, whether the judge is persuaded that it is more likely than not that a certain event occurred. If a party who has the burden of proof in relation to a fact is unable to persuade the judge and thus discharge that burden, the fact is not established.

[27] In the present case, having regard to the difficulties with the documentary record, the oral testimony of the two principal witnesses, Brumley and Bonilla, is the primary resource to which I must turn in order to make my findings of fact. As noted, however, the testimony of each was at times difficult to follow, by reason of the problems with the documents. Nevertheless, I am called upon to assess the credibility and reliability of their testimony.

[28] One specific aspect of the dispute between the parties provides particular insight into the credibility and reliability of the evidence of both Brumley and Bonilla: their dispute regarding Brumley's charges relating to excavation. Simply put, Bonilla accuses Brumley of double billing for the excavation work he performed. Given the relative clarity of the record relating to that issue, it serves as a good starting point for assessing the credibility of these two witnesses.

[29] The excavation dispute arose by reason of the evolving design of the project. As mentioned previously, initially Bonilla planned to construct a 7 foot addition at the rear of the house.

[30] The original contract between the parties provided for excavation work to be carried out by Brumley in order to provide for slab on grade construction of the floor of the 7 foot by 12 foot rear addition. When it was discovered that there was no existing slab on grade under the original rear portion of the house. Bonilla decided to excavate and build a full crawlspace under the rear portion of the house. At this stage of the planning process, the space interior to the new perimeter foundation walls was intended to be a crawlspace only.

[31] Brumley submitted an estimate and change order to Bonilla for excavating the area. Given the limited access for work to be performed at the location, the excavation work had to be carried out by way of hand digging. The earth had to be removed by means of conveyor belt systems into a bin at the front of the house. Bonilla signed the change order (Exhibit 5). The change order was subsequently modified further to amend the masonry price and to add water proofing and an additional footing (Exhibit 7). Bonilla signed that change order, as well.

[32] In order to provide space for the pouring of the footings and the installation of the concrete blocks, the actual excavation itself went almost to the property lines on both sides. Additionally, some excavation internal to the walls was necessary, in order to permit an internal weeping tile system and gravel to be installed. According to Brumley, however, since a crawlspace only was planned for the area within the foundation at this stage (not a full basement) he neither quoted on nor carried out the removal of all soil within the foundation walls. Once the foundation and weeping tile system were in place, the remaining earth that had not been removed from the site was redistributed in the crawlspace area, together with the excess earth that had been excavated from the original rear extension excavation for the previously-contemplated slab on grade construction there. A polyethylene tarp was placed over the crawlspace area and gravel was brought in and placed on top. The profile of the crawl space and the ongoing presence of soil below grade is shown and confirmed in Tabcon Engineering drawing SK3 dated November 5, 2007 (part of Exhibit 13).

[33] The controversy between the parties relates to excavation charges by Brumley subsequent to the above-described work. It is common ground that Bonilla subsequently made a further revision to her plans for the house, and decided to replace the crawlspace under the rear portion of the dwelling with a complete basement. Her evidence is that no additional excavation was necessary, since this area had already been excavated by Brumley for purposes of the crawlspace. She denies having ever signed a change order relating to this work and asserts that Brumley's subsequent invoice for it amounted to double billing for work she did not approve and he did not perform – a serious accusation, tantamount to an allegation of fraud.

[34] In my view, Brumley's evidence and explanation in relation to this aspect of the dispute is supported by and consistent with the evolving design of the project, by such documents as are available, as well as by logic and common sense. It is beyond dispute that, chronologically, the idea to construct a livable basement was a late development and one that occurred only after the prior excavation and foundation work had been completed. Given that the prior plan contemplated only a crawlspace beneath the rear addition, there would have been no need for Brumley to dig out and remove the full volume of earth within the new foundation walls. That extra work would have required considerable additional labour as well as removal costs and thus would not, as a matter of logic, be something Brumley would have planned to do (nor would Bonilla have been willing to pay for) when Brumley submitted his crawlspace change orders, Exhibits 5 and 7. Bonilla confirmed her acceptance of that change to the scope of work when she signed Exhibits 5 and 7.

[35] When Bonilla decided to go forward with a further change in her plans – a full basement instead of a mere crawlspace – Brumley says he prepared and submitted a further change order, which Bonilla signed and approved. Bonilla disputes this. A copy of this change order appears in the materials, unsigned by Bonilla (Exhibit 8). It plainly reflects an additional charge of $10,270 reflecting a change from a crawlspace to a full basement with concrete floor. Exhibit 8 contains handwritten comments by Bonilla, but not her signature. At the very least, this confirms that Brumley gave this document to Bonilla. Brumley's evidence is that he presented the change order to Bonilla at her home, that she signed it and made a photocopy of it while he was there, but he somehow left without taking the signed copy.

[36] Brumley's evidence with respect to the additional excavation work for the full basement is corroborated by several additional documents. Change orders Exhibits 5 and 7 (relating to the crawlspace change) signed by Bonilla contemplated "hand dug excavation with two conveyor systems into bin provided". Subsequently, in his Invoice 337858, Brumley billed for this work. In turn, Bonilla made a significant payment as against that invoice (and others) on December 12, 2007: $9,514.56. Brumley's further evidence was that the additional excavation work to remove the earth in the crawlspace area was not performed until the beginning of January 2008. Exhibit 48 is a bill from a rental service for the use of two conveyor belts at the 159 King Edward Avenue site in January 2008. The existence of the invoice from the rental service is powerful evidence that Brumley was performing further excavation work at the site in January 2008, as he testified he did.

[37] In contrast to the foregoing, Bonilla's evidence relating to the alleged double billing was neither logical nor credible. She purported to assert that the volume of soil removed in late 2007 was such that the entire basement was excavated at that time. She referred to a photograph of the basement area (found at p. 282 of Exhibit 37) and tried to explain the dimensions of the excavation by reference to it. Her estimates were plainly inaccurate – for example, she suggested that eight rows of concrete block below a certain point in the photograph totalled only three and half feet in height; the blocks are each eight inches, with the result that the measurement she placed at three and a half feet was in reality almost two feet higher. Her evidence failed to take into account the fact that compacted soil "expands" in volume, especially when it is hand dug. Her evidence further failed to take into account that it made no sense for Brumley to excavate for a full basement when none was contemplated at the time he quoted for and carried out the original crawlspace excavation. Bonilla’s evidence relating to this topic lacked a "ring of truth".

[38] Overall, I conclude that Bonilla's evidence in relation to this point was contrived and intended to provide after-the-fact justification for her subsequent actions. Specifically, I do not accept her evidence that she did not approve the change order in relation to the basement excavation or that she believed she had been double billed by Brumley. To the contrary, I find as a fact that she did accept and sign the change order for this work and that she knew that Brumley did not double bill for it.

[39] I acknowledge that the foregoing discussion concerns only one aspect of the dispute between the parties. The claim for the basement excavation was, however, a significant one in terms of monetary value relative to Brumley's overall claim for payment. Moreover, Bonilla's complaint regarding alleged double billing by Brumley was relied upon by her at the time to justify several of her other actions in early 2008. To me, the falsity of her allegations on this key point provides considerable assistance to me in evaluating her credibility.

[40] A number of other aspects of Bonilla's testimony also raise concerns regarding the credibility and reliability of her testimony. During the course of her cross-examination testimony, her answers were frequently unresponsive to the questions posed. She was reluctant to answer questions that she considered might be harmful to her case or helpful to her opponent. From time to time she would resort to objecting to answering questions that she did not like. On other occasions she provided information that was not responsive to the questions asked, sometimes with a view to putting on the record information that she thought was helpful to her own case. As a result, I found her testimony was sometimes evasive, in the sense that she was more inclined to argue her case than provide information based on her own observations and recollections. This left me with additional concerns as to her credibility and the reliability of her evidence.

[41] Despite having sworn an affidavit of documents confirming she had produced all relevant documents, on multiple occasions during the course of the trial, Bonilla brought additional documents to court without prior notice. This conduct is not consistent with someone who takes their oath to tell the truth seriously.

[42] In contrast to Bonilla, I had no significant concerns regarding Brumley's credibility. As previously discussed, his testimony in relation to the dispute regarding excavation of the new basement area, was both logical and consistent with the documentary record. I believe and accept it.

[43] In her written submissions, Bonilla attacked Brumley's credibility at length. Many of her complaints were directed at his manner of answering questions, suggesting the he "was trained to answer specific questions in specific ways during the trial." To my observation, that complaint is unfounded. When Brumley disagreed with or did not understand a question, he said so, adding an explanation where appropriate. To the extent he may have repeated similar answers, he did so in response to questions that challenged his evidence in similar ways: it is therefore no surprise that he answered as he did.

[44] A number of Bonilla's submissions regarding Brumley's credibility were in the form of personal attacks on him for "not understanding his fundamental legal obligations under the contract" or for "being confused about basic concepts of construction". Once again, to my observation, these attacks were unwarranted and inaccurate. Brumley impressed me as someone who, while dealing with a difficult customer, tried to perform his obligations as he perceived them and who, in the face of changing designs and site conditions, demonstrated a satisfactory familiarity with renovation and construction techniques.

[45] Bonilla also asserted that Brumley fabricated some invoices and "modified" others to support his case, another very serious accusation. Bonilla further suggested that at least one of the photographs in evidence had been "modified". The weight of the evidence does not support these allegations, which I conclude are unfounded. That she would choose to make them in order to advance her case further reflects adversely on Bonilla's credibility. Her strategy appears to have been to accuse her opponent of lying or falsifying evidence when she had no other basis to disprove or discredit the case being made against her. In her written submissions she submits repeatedly that witnesses who testified for the plaintiff were trained to answer as they did, gave fabricated testimony or were paid to testify. These are very serious allegations that, in my view, were not supportable.

[46] Overall, Brumley's testimony was largely consistent internally and made sense. Although he was cross-examined at length, that cross-examination did not reveal any serious flaws in his evidence. He admitted what he could not recall and generally gave answers that were responsive to the questions posed. I conclude that he was doing his best to recall and recount truthfully his memory of the matters in issue. Unlike that of Bonilla, I have no serious concerns regarding either the credibility or reliability of his testimony.

[47] Based on my assessment of the credibility and reliability of the testimony of the two principal witnesses, I conclude that whenever there was a material difference between their evidence, I prefer and accept the testimony of Brumley over that of Bonilla.

[48] A number of other witnesses testified as well. None of them was privy to the full scope of dealings between Brumley and Bonilla, and none was in a position to elaborate first hand on the contractual and accounting issues. To the extent that their evidence bears upon the remaining factual disputes, I will mention it where it is material to the questions I am called upon to decide.

2. Elements of the contract: e.g. documents, written or oral additions, changes or amendments

[49] At the heart of the relationship between the parties is the written document signed by them in September 2007 (Exhibit 1). That document specified a contract price of $26,800, with various sums to be paid upon achievement of different milestones, such as completion of demolition, completion of excavation and foundation, completion of the first floor and so on. That document provided that the parties could make changes in the work by means of a written Change Order Form signed by both parties. The contract further provided for extras to be calculated on the basis on a lump sum to be agreed on in advance by both parties.

[50] The contract documents were specified as being comprised of the contract and attached drawings and specifications. The state of the documentation was such that it is not possible to determine precisely what drawings were referenced or attached at the commencement of the relationship. The documents presented to the Court included a demolition plan (which indicated interior walls to be removed) so-called renovation plans (which specified that existing exterior walls were to remain) as well as certain engineering plans. These various drawings evolved over time. For example, in early versions, the plans show the south wall of the building “jogging in” approximately 1½ feet halfway along from the front to the rear of the structure. Later plans show the south wall being one straight line from the front to rear. Unfortunately, the state of the records maintained by the parties would suggest that they did not expressly incorporate into their written contract by reference the subsequent or evolving versions of the plans and drawings. Nevertheless, it is apparent that they proceeded with the project by reference to the modified drawings.

[51] One area that is relatively well documented concerns the formal change orders prepared by Brumley when there were significant changes to the scope of work. Bonilla’s signature appears on two change orders – Exhibit 5 and Exhibit 7 – thereby confirming her agreement to those amendments to the contract. Despite Bonilla’s denial that she did so, I find as a fact (for the reasons explained above) that she also agreed to the change order shown in Exhibit 8, changing the crawl space to a full basement with concrete floor. I therefore conclude that the written agreement between the parties included the original contract and the change orders marked as Exhibits 5, 7 and 8.

[52] Lastly, based upon the evidence I accept, I find that from time to time the parties orally agreed to certain minor modifications to the scope of the work to be performed: either Brumley agreed to do certain additional work as requested, or Bonilla requested minor changes or reductions in the documented scope or work. Some, but not all of these minor changes were subject to advance agreement in relation to price; others were paid for by Bonilla after the fact, despite no advance agreement.

3. Scope of work and price

[53] The original contract between the parties contemplated that Brumley would provide services in relation to demolition, concrete work and rough carpentry. As the project evolved, so did the scope of work to be performed by Brumley in each of these areas.

(a) Demolition

[54] The original scope of the demolition work was largely confined to interior partitions and the walls comprising the rear half of the house. This is confirmed by the plans that form Exhibit 2: the interior walls to be demolished are shown in dotted lines. Other drawings in that exhibit confirm that the existing exterior walls at the front half of the house were to remain. Drawing A-1 expressly states this, and designates certain existing windows that were to remain, too. The drawing connotes the walls that were to remain by small dots within the wall cavity; by contrast, those that were to be demolished to provide for the two-storey addition (east of Section C on the north side and east of Section B on the south side) are blank within the wall cavity.

[55] Brumley’s evidence and that of his employee Andrew Benner were consistent with the statement on the drawing “existing exterior walls to remain”. Benner also related a specific conversation with Bonilla; she said she did not remember meeting him. Benner testified that he asked Bonilla about the front exterior walls, because he had noted that were not particularly sturdy. He testified that Bonilla responded that the walls in question were not to be demolished in order for her to be in compliance with the renovation permit that she had been granted by the City. I accept the evidence on the point. It is logical and has a ring of truth.

[56] It is also apparent that the scope of the demolition work was changed subsequent to the termination of the relationship between the parties. New drawing A-1 at page 234 of Exhibit 37 was revised in February 2008 and approved by the City in May 2008, after Bonilla fired Brumley. That drawing shows for the first time a closet to the north of the front door on the ground floor, a relocated front door and a front window of reduced size. All of this work would have required demolition of the front wall of the house, something neither required nor contemplated under the original scope of work.

[57] There is no dispute that the original demolition work also included the exterior walls at the rear and east half of the original building. This was necessary in order to construct the ground floor walls for the new second storey addition. It is also not disputed that the plaintiff carried out this work.

[58] In terms of price, the original contract (Exhibit 1) provided for payment of $7,200 upon completion of demolition. Bonilla’s confirmation of that price for demolition work is reflected in her November 2007 calculation of amounts due found at Exhibit 37, page 45 – her so-called “invoice # 337858 manual”. That document supports the conclusion not only that the agreed-upon cost of demolition was $7,200 but further that by November 2007 Bonilla considered that Brumley had performed 100 percent of this portion of the work.

(b) Concrete work

[59] In the payment schedule on page 4 of the parties' signed contract, this work is referred to as excavation and foundation work. The parties agreed that a payment of $3,500 (less 10 percent holdback) would be due upon completion of this work.

[60] The parties agreed to multiple changes to the excavation and foundation work. These were reflected in and confirmed by three change orders prepared by Brumley. The first of these was Exhibit 5, which provided for the excavation for and construction of the concrete footings described therein. Exhibit 7 was a change order providing for the provision of further masonry services to install the concrete block masonry foundation as well as waterproofing and weeping tile work. These two approved change orders increased the contract price to $41,924.80. There can be no dispute over these amendments to the contract, given Bonilla's signature on these two documents.

[61] For the reasons previously discussed, I find that the scope of work included in change orders at Exhibits 5 and 7 extended only to the excavation of the interior space within the foundations sufficient to create a crawl space. As previously noted, this is confirmed by Tabcon drawing SK3 dated November 5, 2007 (Exhibit 13, page 3). That document further confirms that for approximately six courses of below-grade concrete block, compacted sub-grade soil was to remain.

[62] The final formal change found in Exhibit 8. As previously noted and for the reasons I have already expressed, I find as a fact that Bonilla accepted and agreed to that change order. Specifically, I accept Brumley’s evidence that she signed it in his presence, but failed to provide a copy to him.

[63] I further note that drawing A3 revised January 8, 2008 (page 5 of Exhibit 14) shows for the first time a recreation room at the east end of the basement. As well, drawing A5 in that package reveals for the first time an eastward facing basement window, something not shown on previous versions of the east elevation of the building. Such a feature would have been unnecessary and inappropriate for a mere crawl space in that area. The evolution of the eastern addition from slab on grade to crawl space to full basement is thus reflected in the drawings prepared by or on behalf of Bonilla.

[64] The January 11, 2008 rental invoice for the two conveyors used in the excavation of the additional soil to permit the full basement coincides with the timing of the revised drawings showing the basement. This gives further support to Brumley’s position that the excavation and extra concrete work for the full basement (as opposed to the crawl space alone) were changes to the scope of work to which Bonilla agreed. It makes no sense that Brumley would engage in this additional work and expense unless he was instructed and authorized to do so by Bonilla.

[65] In relation to price, in the first change order, Exhibit 5, signed by her on October 18, 2007, Bonilla agreed to increase the contract price from $26,800 to $36,995.80. In the second change order signed by her (Exhibit 7) Bonilla agreed to increase the contract price to a total of $41,924.80. In the third change order to which she agreed (Exhibit 8) Bonilla agreed to increase the contact price to $52,811.

(c) Rough Carpentry

[66] In general terms, “rough carpentry” refers to the wooden framing and related work associated with the structure of the building. This includes the fabrication and erection of the wooden structures for the walls, floors, ceilings and roof of the building, including interior partitions and bearing walls. It is common ground between the parties that all this work was the responsibility of Brumley under the original contract. The specifics of this work changed slightly with the modification to the rear half of the south wall of the building, but there was no change to the contract as regards the formal scope of the rough carpentry work or the price to be paid for it. This is reflected in the change order at Exhibit 5 which recites merely “changed description of framing (+$0.00).”

[67] The only material difference between the parties position as regards the scope of the rough carpentry work was whether it did or did not include the framing-in of heating ducts once these were installed by the HVAC sub contractor.

[68] With respect to price, the original contract (Exhibit 1) provided for a payment (less 10 percent holdback) of $6,000 upon completion of the first floor and a further $8,137 on substantial completion, or a total of $14,137 allocable to the rough carpentry work.

(d) Extras

[69] There is a dispute between the parties regarding Brumley’s entitlement to charge for and Bonilla’s liability to pay for so-called “extras” to the contract. Brumley asserts that various minor additional work was performed for or expenses incurred on behalf of Bonilla for which Bonilla agreed to pay; indeed in some cases Bonilla did pay some of these costs. For her part, Bonilla disputes liability for these costs by reason of the fact that they were not documented by way of formal change orders. As such, she contends, she is not contractually obliged to pay for them.

[70] There is no question that in relation to major changes to the scope of work, the contract between the parties contemplated a formal change order being presented by Brumley and accepted in writing by Bonilla. I have found that this is what occurred in relation to the three progressive changes to the scope of the work, culminating in the change to include a crawl space; and the change to provide for a full basement. On each occasion, Brumley prepared and Bonilla signed a formal change order, amending the scope of the contract and the contract price.

[71] The written contract also uses the term “extra” in several places. This would suggest that the parties contemplated that certain kinds of extra work would be treated in a manner different from significant changes to the main contract. Indeed, even though in several cases no change orders were signed by the parties, extras were incurred and paid for by Bonilla. The fact that the parties proceeded in this fashion is good evidence that they recognized that, as regards certain aspects of the work and the price to be paid, formal contact amendments by way of change orders were not required.

[72] One example of this practice relates to the purchasing of materials. The agreement between the parties was a “labour only” contact. Brumley was to provide services only; the materials were to be supplied by Bonilla. Despite that arrangement and despite the absence of any written change order, frequently Brumley ordered material and billed it to Bonilla, who paid such bills. This is an example of how, on specific occasions, the parties did not consider themselves bound by their written contract when dealing with such matters. There were several other occasions upon which Brumley invoiced and Bonilla paid for extras.

[73] I will deal with the individual claims for extras and the amounts due or not due for them later. At this stage, however, I can state that I accept Brumley’s evidence over that of Bonilla in relation to the parties' practice concerning extras. Simply stated, I accept and find as a fact that, in addition to the formal change order process through which they went in connection with major changes to the scope of the work to be performed, Brumley and Bonilla also had an informal practice by which extras were requested, proposed, agreed upon, and paid for. Thus, services and materials coming within the scope of this particular feature of the parties' arrangement are matters for which Bonilla agreed to and is obliged to compensate Brumley.

4. Scope of work actually performed

[74] It is common ground between the parties that Brumley did not perform all of the work contemplated by the amended contract. Before he could do so a dispute emerged between the parties. Bonilla asserted that she had been double billed and she stopped payment on a cheque that she had issued to Brumley. Brumley complained that he was not prepared to work until he was paid. It is plain that Bonilla terminated their relationship when she insisted that Brumley not return to the job site.

[75] Although they agree that not all of the work within the contract was performed, the parties disagree concerning the extent the contracted work was actually completed. Brumley asserts that his work was 90 percent complete; Bonilla's position is that only 60 percent of the contracted work was completed.

[76] In support of this position Brumley relies on the site report prepared by Bonilla's engineering consultant, Tabcon Engineering, dated April 9, 2008 (Exhibit 28). That document states in paragraph 3.2:

As of this site inspection, structural part of the construction was 90% completed.

Brumley testified that only certain specified work was left to be completed and he identified the following costs associated with same:

(a) Concrete floor in basement - $ 1,300

(b) Parging of last 3 courses of block - $ 300

(c) Strapping of basement walls - $ 300

(d) Setting in windows - $ 300

(e) Setting posts - $ 25

(f) Blocking - $ 250

(g) Moving gravel - $ 600

[77] Bonilla counters that the 90 percent completion mentioned in the Tabcon report was, at best, referable to the structural portion of Brumley's work. According to her, the level of completion of Brumley's overall work under the contract was less than 60 percent.

[78] Each side disputes the evidence and calculations of the other with respect to the degree of completion and/or the costs to complete at the time their relationship was terminated. With the exception of the report from the engineering consultant, there was a dearth of independent evidence with respect to the amount of work done or to be done. The determination of the actual level of completion requires a combination of contract interpretation, review of drawings, assessment of evidence and arithmetic. The parties' contract divided the work into demolition, concrete and rough carpentry work. I therefore propose to approach each aspect of the work to determine the respect of degrees of completion.

(a) Demolition

[79] Bonilla's position is that Brumley completed only 75 percent of the demolition work. She complains that Brumley did not demolish part of the exterior walls at the front of the house. This activity was completed by another contractor.

[80] Bonilla's position appears to be premised on the theory that, in addition to the complete demolition of the rear half of the existing house and the interior walls, Brumley was also responsible for the demolition of the front half of the existing building. She relies on the so-called demolition plan D-1 at p. 2 of Exhibit 12. Apart from the dotted lines for the interior partitions that were to be removed, together with the back sliding door, as tendered in evidence that document does not reveal much about the actual demolition work to be carried out. Indeed, if one accepts Bonilla's argument that this plan indicates what was to be demolished, this would mean the entire structure was to be taken down to the ground floor.

[81] A better understanding of the scope of the actual contemplated demolition can be found in drawings A-1 and A-1a that also form part of Exhibit 12. Drawing A-1 notes that "existing exterior walls to remain" and specifically mentions two exterior windows that are to remain on the north and south side of the building. Drawing A-1 and Drawing A-1a distinguish between the walls in the front half of the building – which shows small dots within the cavities on the drawing – and those at the rear of the building which are blank within the cavities. The existing windows that are to remain are found within the portions of the walls containing the dotted coloration. The conclusion that I draw is that the walls that were to be demolished were the ones on the rear half of the building that were to be replaced with walls capable of supporting the second floor structure that was to be added. As I have noted previously, Brumley completed all of the rear demolition work.

[82] As I have also noted previously, Bonilla's plans with respect to the front of the house changed when she relocated the front door, installed the closet, and reduced the size of the front window. All of this work necessitated the demolition of the front wall of the house, something that was not contemplated when Brumley signed the contract. This demolition work was therefore not part of his contractual obligations.

[83] Finally, as I have further noted above, one of Brumley's employees remarked to Bonilla that the existing side walls on the front half of the building did not look structurally sound, to which she responded that she could not take them down due to permit issues with the city. I accept that evidence, based upon my understanding of the drawings to which I have referred previously.

[84] I therefore conclude that Brumley performed all of the demolition work contemplated by the contract between the parties.

(b) Concrete

[85] Under this heading I would include both the excavation work necessary to install the concrete, together with the construction of the frames into which to pour the concrete, installation of rebar, concrete block, parging, finishing, as well as associated water proofing, and installation of gravel and weeping tile. As I have previously noted, the original plans for slab on grade construction was superseded by a crawlspace and finally by a full basement. The parties disagree as to the scope of work left undone by Brumley, as well as the quality or sufficiency of some of the work he admittedly performed.

[86] Firstly, in relation to excavation, I have previously discussed Bonilla's contention that she was double billed by Brumley for excavation work in the basement. As noted, I do not accept that submission. Instead, I conclude that Brumley performed all of the excavation work that he was hired to do and he did not double bill for any of it. In relation to the additional excavation in the basement prior to pouring of the slab (for which Bonilla claims to have paid someone else) I am unable to find that this was part of Brumley's responsibility; in my view, the evidence does not support that conclusion. At most, following the additional excavation work done by Brumley, some minor grading was required in advance of the placement of the gravel and rebar. I therefore find as a fact that Brumley performed all of the excavation work at the site that he contracted to perform.

[87] In relation to concrete work, the main work left unfinished when Brumley left the site concerned the pouring of the slab in the new basement space on the easterly half of the basement floor. The parties disagree as to the potential expense for doing so: Brumley estimates it at $1,300, while Bonilla insists it would be more than $2,000. Bonilla bases her calculation on a separate quotation from Brumley for pouring other concrete as part of the foundation for the footings for the concrete block foundation. In my view, that comparison is inappropriate. In order to pour the footings, Brumley first had to construct forms into which the concrete could be poured. Appropriate rebar had to be shaped and installed. Then concrete had to be poured and finished in such a fashion as to accept the concrete block that had to be installed on it. Overall, installation of the footings was a far more complex task than merely pouring and finishing a flat concrete surface within the confines of the basement walls that had already been constructed. I therefore reject Bonilla's estimate and accept that of Brumley.

[88] Brumley concedes that he did not install the gravel that had to be placed on the earth before the concrete was poured. In the absence of any other direct evidence concerning the costs of installing the gravel, I accept his that assigns a value to this work at $600. Adding his estimate of the cost to pour and smooth the concrete of $1,300, results in a total of $1,900 worth of work that he did not do on this account.

[89] Brumley also concedes that he did not do the parging of the last three courses of concrete block. He estimates that the costs of doing so would be approximately $300. Although Bonilla included in her materials a renovation contract with Elias Aguilar Gale that purported to include this work, it did not include a breakout of the expense of parging. There is therefore no direct evidence to contradict that of Brumley regarding the costs of completing the parging work.

[90] Another aspect of the concrete work was the water proofing and weeping tile system. When the concrete block foundation was initially installed, a drainage system suitable for an internal crawlspace was installed. When the plans subsequently changed to provide for a full basement, additional drainage was required by the city. I do not consider this part of Brumley's contractual responsibility. The fact that this work was performed by another contractor has no bearing on the state of accounts as between Brumley and Bonilla.

[91] The only remaining aspect of concrete work that is in dispute concerns the removal of the necessary concrete blocks at the north end of the east wall of the foundation to permit the installation of the window. The evidence on this point is somewhat unsatisfactory. I conclude that I am not persuaded that Brumley had completed this work before he left the job. I would therefore conclude that an additional $200 should be added to the total for the concrete work not performed by Brumley.

[92] This brings the total value of the un-performed portion of the concrete aspect of the contract to $2,400.

(c) Rough carpentry

[93] As noted previously, Bonilla's own structural engineer concluded that 90 percent of the structural part of the construction was completed: see Exhibit 28. Bonilla asserts that she hired another contractor to complete the structural framing. She further asserts that only 60 percent of the non-structural framing, such as interior partitions, was completed by Brumley. She cites his failure to complete the framing of the bathroom, the landing stairs, the extension of the framing for the suspended ceiling, and the framing of the heating boxes, for all of which she had to hire another contractor. Based on the charges in Bonilla's contract with Elias Aguilar Gale (p. 384 of Exhibit 34), the total expense for this work was $375. While I note that Brumley does not concede responsibility for this work, arguably it is part of the "rough carpentry" that he agreed to perform but did not. It therefore must be added to the amounts for work that was left undone when he left the job site.

[94] Other work conceded by Brumley to be within the scope of his contractual obligations that he did not perform included the strapping of basement walls, the setting in of windows, setting a post, and blocking. Brumley's estimated total costs for these items is $875. I can find no separate estimate for strapping of the basement walls in Bonilla's evidence, but her total for setting of windows, setting the post and blocking is $1,400. Adding another $300 for strapping of the basement wall amounts to $1,700. Taking an average between the two and erring slightly in favour of Bonilla arrives at a value for further work not done by Brumley with a value of $1,300.

[95] Apart from the foregoing, Bonilla asserts that Brumley failed to perform other work associated with the project, including cleanup and removal of debris. I am unable to find, based on the evidence, that Brumley's work was materially deficient on these fronts. Indeed, Brumley sought to charge Bonilla for clean up as an extra, which indicates he did perform some cleanup work. I have disallowed that extra, below. To the extent Bonilla had to pay others to complete cleanup, portions of that cleanup work were attributable to debris left by other contractors. Had Brumley not been terminated from the project, he would have been able to complete the cleanup work at no material increased costs. I therefore conclude that this item did not have material impact on the value of his uncompleted work.

(d) Conclusion as to degree of completion of work by Brumley

[96] In the foregoing analysis I have concluded that Brumley completed all of the demolition work within the scope of his contract. In relation to concrete work, I conclude that he had completed all but $2,400. In relation to rough carpentry, he had completed all but $1,675. Thus, the total value of the work he had yet to perform on the contract was $4,075. Compared to a total contract price of $52,811, this represents less than 8 percent. In other words, when Bonilla terminated the contract, Brumley had completed at least 90 percent of the work he was contracted to perform.

5. Timeliness of performance – agreed timeline, actual timeline and explanation for differences (including agreed or required extensions)

[97] According to the parties' signed contract, the work was to commence on September 26, 2007 and was to be substantially completed within eight weeks. By the time Bonilla terminated Brumley's services at the end of March 2008, Brumley's work was not completed. The parties disagree as to the cause or causes for the delays and who should bear responsibility for them.

[98] Although the original contract provided for an eight week time for completion of Brumley's work, none of the change orders approved by Bonilla addressed the question of timing. It is beyond dispute that there were several, significant changes to the scope of the contract. The total price of Brumley's work almost doubled from $26,800 to $52,811, reflecting a substantial increase in the work to be done. A further complication was the fact that the changes were made on an ongoing basis, that is, as the work was being performed. This necessitated some duplication of effort and complicated the sequencing of the work. A prime example of this was the decision to convert the rear portion of the addition from a crawlspace to a full basement below grade.

[99] It is self-evident that some of the extra time that was consumed was necessary merely to complete the additional work. The orderly performance or sequencing of the work, given that the changes were made while the project was already under way, also contributed to the amount of time required. Beyond those obvious factors, however, the reasons for the delay in the completion of the work and the identification of the party responsible is a difficult task on the record before me.

[100] Bonilla asserts that, with the additions to the work, the total contract should have been performed in 13 weeks. With respect, I do not consider that the evidence I accept supports that assertion. She did give evidence, however, that there were lengthy periods of time when, to her observation, there was little or no activity at the job site. She cited gaps in December, January and March.

[101] For his part, Brumley pointed the finger at Bonilla. He highlighted the changes of plans and her failure to remove snow to keep the site accessible, among other complaints. In particular, he pointed to her failure to make timely payment of his invoices as justification for any alleged lack of timeliness in performance of his obligations.

[102] In my view, both parties must bear some of those responsibility for the delays in progress of the work. On the record before me, it is impossible to make a specific or precise allocation or calculation of the degree of fault allocable to either party.

[103] In view of the fact that neither party is free of blame, to the extent there was a financial consequence or cost of the delay, I would assign 50 percent of that cost to each side. I will address this specific financial impact of this shared responsibility later in these reasons.

[104] I note that the record contains no written evidence of any complaint by Bonilla regarding the timeliness of the work prior to Bonilla's termination of Brumley's contract. The absence of such complaint would be consistent with a recognition by the parties that they each bore a degree of responsibility for the slow rate at which the job was completed.

6. Deficiencies or disputes regarding work performed

[105] Bonilla advances several complaints regarding alleged deficiencies in the work performed by Brumley. I will deal with each of these in turn.

(a) Cathedral Ceiling

[106] Bonilla's principal complaint is that the cathedral ceiling in the second floor was not built in accordance with the plans. She further complains that a flat ceiling was installed in the second floor hallway. I should note at the outset of this discussion that Brumley's responsibility vis-à-vis the cathedral ceiling in the second floor was limited to the framing and not the installation of the actual drywall. At the time he was terminated from the job, Brumley had completed the framing of the roof/ceiling on the second floor and had installed the exterior roof itself.

[107] Bonilla's specific complaint is that Brumley deviated from the plans and designs for the cathedral ceiling, without her permission. More particularly, she complains that instead of installing ridge straps between the main beam and the rafters as the plans provided, he installed cross-braces between the rafters, below the main beam. As a consequence, Bonilla complains, the ceiling did not reach a specific peak but rather was flat at the very top. She complains that this deviation from the intended design detracted significantly from quality of the finished house, and diminished its value significantly. She made the same complaint with respect to the decision of Brumley to frame for a flat ceiling in the hallway on the second floor, instead of leaving a space open to the interior side of the roof above.

[108] Brumley acknowledges that he did not construct the cathedral roof ceiling in accordance with the plans. Specifically, he acknowledges that he did not use ridge straps but instead chose to use cross braces. He asserts (and Bonilla's consulting engineering agrees) that the resulting construction had the same structural integrity. He further asserts that the design provided to him by Bonilla was unworkable, since it did not provide for proper ventilation of the insulated space inside the roof cavity. He further responds that, once the ceiling was drywalled, whether using the Bonilla design or the Brumley installation, the end product would have had some portion of a flat peak and would never have come to a point, nor would the main beam or rafters had been exposed in either design. He thus maintains that Bonilla's complaint is without substance.

[109] With respect to the framing for the flat ceiling in the hallway, Brumley points out that, to the extent this may have been a departure from Bonilla's design, the ceiling would have been offset in the hallway and as a result a high ceiling would have had an odd angle and appearance. In any event had Bonilla truly been unhappy with this framing work by him, this portion of the framing was not structural and could have been removed by Bonilla very easily, so as to return to her design if necessary. Once again, according to Brumley, this complaint is without substance.

[110] In my respectful view, the cathedral ceiling issue is largely a "red herring". I agree with Bonilla's complaint that Brumley deviated from the specific design contained in the plans. That said, in my view, the deviation was immaterial and was carried out for a good purpose. Bonilla's design with respect to the cathedral ceiling did not properly allow for ventilation of the insulation above the drywall ceiling, as required by the Ontario Building Code. Brumley solved this problem by constructing the cathedral ceiling as he did. With respect to the portion of the peak that is flat, instead of pointed, as I have noted Bonilla's design included a flat portion as well. Although Bonilla's expert witness described the original plan for the peak of the cathedral ceiling as "an inverted 'v'" coming to a point, in truth this was not the case all along. Brumley's modification included a somewhat larger flat portion, but did not materially lower the overall height of the ceiling. While a very modest change in appearance resulted, in the overall scheme of things the change was immaterial and was carried out for a proper purpose, namely, to correct a flaw in Bonilla's design and drawings. Thus, while Bonilla is correct that Brumley deviated from the plans, I would attribute no material consequences to the deviation in the bedroom area.

[111] With respect to the flat ceiling framed in by Brumley in the hallway, this could easily have been remedied by Bonilla had she considered it necessary to do so. She did not disagree with Brumley's assessment that the resulting appearance would have been undesirable.

[112] Overall, therefore, I consider the cathedral ceiling complaints to be of no material consequence for the parties' legal positions. Rather, I infer that Bonilla latched on to them as a basis for arguing that her nonpayment of Brumley's invoices was somehow justified by his failure to perform the contract in accordance with the drawings. This became apparent when Bonilla was confronted on cross-examination with her own diagram that showed her design also included a flat section, and she changed her position to assert that she had wanted an exposed beam ceiling. The concept of an exposed beam ceiling had never been mentioned in any previous document and contradicts her own drawing A-7 in Exhibit 46 which does not provide for exposed beams but instead shows a full drywall ceiling covering both the rafters and the main beam. Her testimony on this point is not credible.

[113] It remains the case that, without advance approval from the owner, Brumley modified the design for the ceiling installation. To that extent he did not perform the work he was contracted to perform, and thus he breached the parties' contract. I will deal with significance and consequences of that breach below.

(b) The basement

[114] Apart from her complaint that Brumley failed to complete the basement work by not pouring the concrete floor or installing the strapping on the walls, Bonilla complains that the exterior water proofing installed by Brumley was deficient. As a consequence, she complains that she had to install additional interior water proofing and an internal weeping tile system connected to the sump pump in the original basement. This work would have not been required, she argues, but for the poor quality of the exterior water proofing.

[115] Brumley denies any deficiency in relation to the exterior water proofing. He challenges Bonilla's evidence that suggests that there were such deficiencies. He argues that that evidence fails to establish that any interior moisture seen on the concrete walls of the basement was attributable to a failure of the exterior water proofing system for which neither he nor his subcontractor may be held responsible.

[116] The evidence relied upon by Bonilla in support of her complaint regarding the alleged water proofing problem consists of some photographs, an inspection report by a city building inspector, and the expert testimony of an engineer. With respect to the photographs, one of them depicts moisture on certain portions of the interior walls of the basement. Another depicts a portion of an exterior wall, showing some external styrofoam installation that appears to have pulled away from the parged and waterproofed wall itself. The report of the building inspector suggests that "water is getting into basement even though damp proofing and drainage layer installed". The evidence of Bonilla's engineer was based on the photographs since he was unable to inspect the interior walls personally. In cross-examination he characterized his evidence as to the cause of the problem as a "preliminary analysis". He conducted no moisture reading at the time of his inspection, and thus he was unable to say whether the moisture shown in the photographs of the unfinished interior basement wall was indeed an ongoing problem.

[117] According to Bonilla, she was forced to install an interior moisture barrier and weeping tile system, connected to the sump pump in the westerly portion of the basement. She seeks to assert the cost of this work as a charge payable by Brumley, since she asserts that it was deficient work by him which caused the moisture problem.

[118] The first question to ask is whether Bonilla has proven on a balance of probabilities, that the moisture observed in the photograph was, indeed, attributable to deficient work for which Brumley is responsible. Brumley testified (as other photographic evidence confirms) that there was significant snow accumulation around the property during the winter of 2007 – 2008. The building was left open to the elements through most of this period. The grading around the perimeter had yet to be completed. There were no eavestroughs to divert rainfall or melting snow away from the foundation. As a result of all these factors, the potential for moisture seeping into the foundation from these sources cannot be overlooked. When these suggestions were put to the expert called by Bonilla, Mr. Korotky, he acknowledged that there were many possible reasons for how water could have entered the basement. Mr. Korotky further acknowledged that, to the extent there were signs that the waterproofing membrane on the exterior of the building had been detached at the top, it would be reasonable to simply reattach it to determine whether there was any subsequent intrusion of water.

[119] With respect to the basement moisture problems giving rise to a need for interior weeping tile, Drawing A-8, Section Detail 4-A-8 provides for a weeping tile system internal to the crawlspace addition as does Drawing 1-A-8. Plainly these drawings were part of the initial re-design when Bonilla decided to install a crawlspace beneath the addition. This establishes that the concept of an internal weeping tile system was part of Bonilla's revised design, for which she contracted with Brumley when she signed the crawlspace change order. It is therefore not something for which Bonilla can complain about an extra expense caused by deficient work by Brumley. At most, she could claim for the cost of installing internal wall waterproofing. This is a further example over reaching by Bonilla.

[120] The City of Toronto building inspector recorded on his inspection of November 30, 2007 that it was "ok to backfill". The note goes on to say "damp proofing applied & drainage layer". This suggests that the building inspector saw and approved the waterproofing to the exterior of the basement walls. This lends support to the conclusion that the moisture problem that was subsequently discovered was not due to the inadequacies of the exterior waterproofing applied by the plaintiff or its subcontractor, but was instead due to water that was allowed to get inside the waterproofing by reason of the accumulation of snow and melting ice as well as rainwater off the roof, all before any proper grading was applied around the exterior of the house.

[121] Although one of the photographs does show that a piece of the exterior membrane wrap had become detached from the wall, if Brumley had been told about this he would have reattached it and caulked it. He was given no opportunity to address the basement problem.

[122] With respect to the interior work on the basement to address the drainage problem, even if the cause was some deficiency in Brumley's exterior waterproofing work (which I do not find was the case) the simple solution was to apply the same material on the interior as was applied on the exterior, drape it over the foundations and the interior weeping system, and then pour it into the new basement slab. This way the moisture would have been kept outside of the room and flowed down to the interior weeping system. According to Brumley, the costs of this material would have been up to $600 and would have taken two men less than an hour to complete. This would have resulted in a cost of less than $700 in the aggregate. Brumley testified that he would have done it gladly but he was not given the opportunity to do so. Thus, to the extent there may have been a problem with the basement, the total costs that Brumley could be called upon to bear is $700. For the previous reasons I have articulated, I find no responsibility on Brumley to bear this expense.

[123] Based on the evidence presented, I am not persuaded on a balance of probabilities that the cause of the moisture shown in the photograph relied upon by Bonilla was attributable to any material deficiency in the work performed by Brumley. Moreover, I am not satisfied that Bonilla took all reasonable steps to remedy the problem, such as resealing the waterproofing membrane in the area at which it may have pulled away from the building. In my view, it is as likely as not that the problems seen in the photograph were attributable to the causes described by Brumley. Since the onus of proof to establish deficiencies is on the party alleging them – i.e. Bonilla – I must conclude that she has failed to do so as regards to the waterproofing issue. I therefore do not accept that Brumley's work in this regard was deficient, or that he owes Bonilla any sum on this account.

(c) Extras

[124] As previously noted, there was a dispute between the parties regarding Brumley's entitlement to charge for and Bonilla's liability to pay for so-called "extras" to the contract. For the reasons stated above, I accept and find as a fact that, in addition to the formal change order process through which they went in connection with major changes to the scope of the work to be performed, Brumley and Bonilla also had an informal practice by which extras were requested, proposed, agreed upon, and paid for. I turn now to a review of those specific items for which Brumley claims payment as extras to the contract.

(i) Removing existing floor assembly and cleanup of garbage in crawlspace - $720 plus GST = $756

[125] In his Invoice 337858 dated October 15, 2007, Brumley charged $720 plus GST for the removal of an existing floor assembly that was not structurally sound and the cleanup of garbage from the original crawlspace. This work related to the unanticipated removal of the floor at the rear of the building that had wrongly been assumed to be constructed as slab on grade. Instead, it was supported by posts similar to those used in a patio deck. Since this demolition work was not planned initially, it was extra to the main contract. As well, a crawlspace area beneath it was found to contain garbage, old bottles and ash, indicating it had once been used as a fire pit of some sort. Brumley removed all of this, as an extra.

[126] The fact that Bonilla agreed to this extra work and further agreed to pay for it is reflected in the fact that she approved and paid this expense when it was included in Invoice 337858. Based upon her evidence, it is plain that Bonilla paid very close attention to the charges submitted from time to time by Brumley, and thus her payment of this sum supports the conclusion that she agreed to pay for this extra. I do not accept her evidence that she made this payment in error or that it was part of the existing contract. Brumley is entitled to be paid for this extra.

(ii) Additional rebar and installation - $566.96

[127] This item is reflected in Brumley's Invoice 337859 dated October 27, 2007. This sum was not paid by Bonilla. I am unable to find any confirmatory evidence that she agreed to this additional expense. In the absence of such agreement, Brumley cannot charge for this sum.

(iii) Additional material as per Invoice 337865 - $4,605.65

[128] As mentioned previously, the contract between Brumley and Bonilla was labour only. In other words, Bonilla was to supply and pay for all materials. Contrary to the terms of the written contract, from time to time Brumley ordered and paid for materials that were necessary. In turn, he invoiced Bonilla. Invoice 337865 for $4,605.69 is one such example. Bonilla paid $4,260.73 against this invoice, reflecting her agreement, to this extent, to this extra.

(iv) Tarping and heating of footings - $271.36

[129] This charge relates to the expense incurred by Brumley in order to weatherproof the concrete footings. These were poured as late in the process as they were due to the changes in the work initiated by Bonilla. They were included in Brumley's Invoice 337866 dated December 2, 2007. In turn, Bonilla paid this invoice, once again confirming her agreement to pay the costs of this extra.

(v) Soil removal using bobcat - $1,200 plus GST = $1,260

[130] This extra expense related to the costs of removing the extra excavated soil in January 2008. During the previous excavation for the crawlspace, the area at the front of the house was clear and accessible such that disposal bins could be delivered to the site and removed once the soil was placed in them. By the time the further excavation was carried out in January 2008, however, due to the accumulation of winter snow, among other things disposal bins could no longer be placed at the front. As a result, it was necessary for the soil to be transported and removed using a bobcat. The total expense for doing so was $1,200 plus GST. This sum was included in Brumley's Invoice 337869 dated January 24, 2008. This amount too was duly paid by Bonilla.

[131] Once again, Bonilla is disputing liability for an amount that she previously paid. I do not accept her evidence that she did not agree to this expense, given her demonstrated diligence in reviewing invoices. I accept that Brumley did this work and incurred this expense for Bonilla's benefit. He is entitled to be paid for $1,200 plus 5% GST for a total of $1,260.

(vi) Credit to Bonilla for cost of tools - $305.46

[132] Brumley concedes that certain items included in Invoice 337865 were tools that were not probably chargeable to Bonilla. He therefore acknowledges a credit of $305.46 is due as against that invoice.

(vii) Removal of snow and construction waste - $892.50

[133] This was a sum that was not paid by Bonilla. Under the terms of the parties' contract, Brumley was responsible for keeping the site clean. Given that there was no express agreement to him incurring this cost, nor any subsequent approval for it, I am not prepared to require Bonilla to pay this sum.

(viii) Summary in relation to extras

[134] Based on my assessment, Brumley is entitled to be paid the following sums on account of the following extras:

removal of floor and cleanup of garbage

$ 756.00

additional rebar

nil

additional material

4,260.73

tarping footings

271.36

bobcat for soil removal

1,260.00

credit for cost of tools

(305.46)

removal of snow

Nil

Net sum due to Brumley for extras

$6,242.63

(d) Washroom deficiencies

[135] Bonilla complains that in relation to the second floor master bathroom and the main floor bathroom, Brumley did not adhere to the specific framing dimensions in several respects. The most obvious of these is the framing of the door of the master bathroom, which was to be a 20 inch door rather than the 36 inch space framed by Brumley. A similar problem was encountered on the main floor bathroom. Other complaints relate to the framing of the bathtub enclosure in the master bathroom, leading to additional expenses to finish the interior space in that room.

[136] To the extent Brumley created door frames of the wrong dimension, I accept that he failed to follow the plans. The same may be said with respect to his failures to place walls where they ought to have been. I consider these relatively minor deficiencies in the overall scheme of things, bearing in mind that Brumley's job was rough carpenter. Some adjustments in the final details in a renovated building are inevitable.

[137] That said, to the extent Bonilla incurred unanticipated expense due to incorrect framing by Brumley, she is entitled to be compensated.

[138] A final framing complaint made by Bonilla concerns a 4 inch offset in one of the walls in the master bedroom. At best, I can determine that offset was necessitated by the presence of the stairwell opening from the main floor to the second storey. As such, I consider it one of the inevitable variations to plans that emerged during a house renovation. There is no evidence that Bonilla incurred any additional expense or suffered any loss arising from this supposed variations from plans. I therefore consider it to be of no significance.

7. Other complaints

(a) Fundamental breach

[139] Bonilla argues that she planned a custom made house with specific characteristics that made the house unique according to her architectural style already proven in several houses that Bonilla had built in the same neighbourhood. She asserts that this house was planned to be energy efficient, taking advantage of the cathedral ceiling and solar energy panels. Among other features, the 12 foot cathedral ceiling peak is said to be one of the energy saving design features.

[140] Bonilla therefore argues that the deviation from the design of the cathedral ceiling led to an end result that was completely different from the house planned. She argues that the volume of the second floor is diminished, the ceiling is not as aesthetic and the energy saving feature was damaged. She therefore argues that, by reason of these changes, she is not getting the house that she planned.

[141] Brumley has acknowledged that he did not construct the cathedral ceiling in precisely the fashion planned by Bonilla. As I have noted, he did so for a valid reason, namely, to address the fact that Bonilla's design was not apt for purposes of roof installation ventilation. As I have further noted, however, the lowering of the ceiling height was not material and the overall concept of a cathedral ceiling was preserved.

[142] In Place Concorde East Limited Partnership v. Shelter Corp. of Canada Ltd. (2006), 2006 CanLII 16346 (ON CA), 270 D.L.R. (4th) 181 (Ont. C.A.), that court considered the legal principles applicable to fundamental breach. In that case the court reviewed the basis for a finding of fundamental breach, as established by the Supreme Court of Canada in Hunter Engineering Co. v. Syncrude Canada Ltd., 1989 CanLII 129 (SCC), [1989] 1 S.C.R. 426. The Court of Appeal noted at para. 51 that:

[a] breach that allows the non-repudiating party to elect to put an end to all unperformed obligations of the parties is an exceptional remedy that is available only in circumstances where the entire foundation of the contract has been undermined, that is, where the very thing bargained for has not been provided ….

[143] In my view, the departures from the plans of which Bonilla complains fall far short of depriving her of the benefit under the contract for which she bargained. As I have previously concluded, Brumley performed over 90 percent of the work he contracted to perform before he was excluded from the job site. Moreover, in the aggregate, the shortcomings of which Bonilla complains are relatively minor compared to the scope of work actually performed. Brumley did all the demolition work he agreed to do, he did most of the concrete work (with the principal exception of pouring the slab in the basement) and he did at least 90 percent of the framing. Even taking into accounts the deficiencies at which Bonilla complains, by no measure can it be said that Bonilla was deprived of "the very thing bargained for".

[144] I therefore conclude that Bonilla cannot succeed on her assertion of fundamental breach as justifying her repudiation of the contract between the parties.

(b) Registration of an unjustified lien

[145] On April 8, 2008, subsequent to Bonilla's decision to terminate their relationship, Brumley registered a construction lien against the property for a total of $17,185. The lien was subsequently discharged when Bonilla provided security for it. She complains that, according to her records, based on the amount of work performed and the sums paid by her, the total amount she owed to Brumley was $3,184.21. She therefore complains that the amount of the lien was excessive and forced her to incur considerable legal and financing expense to discharge it.

[146] In support of her position, Bonilla asserts that Brumley fabricated invoices for a total of almost $12,000, and increased the amount of invoices already paid by over $5,200. Once again, these are very serious allegations that, in my view, are simply not supported by the evidence.

[147] In the analysis above, I have concluded that out of the contract price of $52,811, Brumley had performed over 90 percent, leaving unperformed work of a value of $4,075. This means that the value of the work performed by him under the contract was $48,636. I have also determined that Brumley is entitled to a further $6,242 for extras. This means that the total sum due to him was $54,878.

[148] There is no dispute that Bonilla paid the total sum of $35,412 to Brumley. Thus the difference between the value of the work performed ($54,878) and the amount paid ($35,412) is $19,366. That amount is more than $2,000 greater than the amount of the lien registered. I therefore concluded that Bonilla's complaint that the lien registered by Brumley was excessive and unjustified is unsupportable.

(c) Materials taken from the job site

[149] Bonilla claims that Brumley improperly removed from the site building materials that had been paid for by Bonilla. This amounts to an accusation of theft. In such circumstances, while the burden of proof of criminal conduct remains the balance of probabilities, the weight of the evidence requires is great: see Rathwell v. Zenith Insurance Co. (2003), 2003 CanLII 39801 (ON SC), 65 O.R. (3d) 713 (S.C.J.) at para. 8.

[150] Bonilla claims she had an inventory system that allowed her to quantify the materials bought and consumed in the construction process, together with calculations of material that was left over and should have been returned to the supplier. She claims she inspected the site after Brumley left, and determined that a huge amount of materials has been removed from the site.

[151] Despite her claim to a detailed inventory system, Bonilla purported to prove her assertion of wrongful removal of material by producing invoices and a series of calculations as to the quantity of material required to complete various aspects of the framing work. In my observation, her calculations were neither reliable nor accurate.

[152] In any construction project, it is inevitable that there will be some wastage when wood is cut for a particular application. Brumley testified that this was the case here.

[153] Brumley also testified that, on occasion, Bonilla ordered material that was of the wrong dimension. He advised Bonilla to return these and replaced them with less costly items. Bonilla, however, contrary to her suggestion that she has detailed inventory records, was unable to account for these returned goods.

[154] Finally, Brumley denied that he took any materials. I accept his evidence in preference to that of Bonilla for the reasons described above.

[155] For these reasons I conclude that Bonilla has failed to prove any wrongful conduct on the part of Brumley relating to the improper removal of construction materials.

(d) Consulting fees

[156] Bonilla asserts an entitlement to be compensated for engineering, legal and paralegal fees incurred since the dispute arose between the parties. These include claims for visits by herself to the site.

[157] In relation to the claim for engineering fees, Bonilla has not proved that she incurred any additional non-litigation driven engineering costs due to Brumley's conduct. I therefore award nothing to her under this account.

[158] Dealing next with the claim for legal fees, to the extent Bonilla claims indemnification with respect to her legal expenses, in my view, her entitlement to do so depends on the degree of her success in the litigation. Put simply, if she is found to be on the wrong side of the legal dispute with Brumley, it does not make sense that he should be required to pay her legal costs. I therefore decline to award her anything on this account at this stage.

[159] To the extent Bonilla incurred legal fees arising from the need to deal with the construction lien and the subsequent refinancing of the project, given that I have found Brumley was justified in registering the lien, Bonilla is entitled to no recovery on this account.

[160] In relation to her so-called "consulting fees" paid to herself, these are part of Bonilla's own overhead as project manager. They would have been incurred in any event and I therefore decline to award her anything on this account.

(e) Damages for possession of plans

[161] Bonilla complains that Brumley wrongfully took with him a set of the construction plans from the job site. She seeks reimbursements of $1,750 on this account. She produced no evidence to substantiate this expense.

[162] Brumley admits that he had copies of the plans. Presumably, he removed them when he was discharged from the site, at a time when he was still owed a significant sum by Bonilla.

[163] In the circumstances, quite apart from Bonilla's failure to prove this head of damage, I am not prepared to fault Brumley for acting as he did. Bonilla did not have cause to terminate the parties' contract. Bonilla owed Brumley a significant amount of money. It was reasonable for Brumley to anticipate that he would have to pursue a legal remedy to get paid. In the course of so doing, in order to prove his case he would need the plans – indeed he tendered them as evidence at the trial before me.

[164] Given that, as I have previously concluded, Bonilla did not have cause to terminate the parties' contract, and I find no fault on the part of Brumley in relation to the removal of the plans, it follows that I would award nothing to Bonilla on this account.

8. Damages flowing from above

[165] In my analysis of the factual and legal issues above, I have reached various conclusions with respect to the merits of the respective parties' position. I now turn to the quantification of the damages, if any, arising from the breaches I have identified.

(a) Damages claim by the plaintiff

(i) Sums due for work performed

[166] I have previously concluded that the total value of the work that Brumley had not completed when his services were terminated was $4,075. Deducting that sum from the total contract price of $52,811 leads to the conclusion that Brumley had performed contract work having a value of $48,636. In addition, Brumley performed or provided extras having a total value of $6,242.62. Thus, the total value of the services performed and goods provided by him was $54,878.63.

[167] It is common ground that the total sum paid by Bonilla was $35,412.82. Subtracting that sum from the value of the services provided results in an unpaid debt due from Bonilla to Brumley of $19,365.81.

(ii) Damages for wrongful termination of the contract

[168] In view of the conclusion I have reached that the contract was wrongly terminated by Bonilla, Brumley is entitled to advance the claim for loss of profit on the work he was not permitted to complete. He has not tendered any evidence to support that claim and thus I award no sum to him on this accounts.

(b) Damages claimed by the defendant, plaintiff by counterclaim

(i) Damages for Brumley's failure to comply with the plan and completion costs

[169] The principal deviation from the plans of which Bonilla complains was Brumley's unilateral modification to the cathedral ceiling. Although there was a problem with ventilation arising from the design contained in the plan, instead of consulting with the client, Brumley chose to modify the design as he chose. This deprived Bonilla of the opportunity to modify her design to address the ventilation problem.

[170] As I have previously found, from the practical perspective there was no material impact arising from Brumley's modification to the cathedral ceiling design. That said, the aesthetic outcome (with a larger flat portion at the peak) was different from that which Bonilla had contracted for. Similarly, the deviation from plans resulting in a flat ceiling in the hallway was of no material significance but it resulted in a different aesthetic outcome.

[171] Given that Brumley did not deliver what Bonilla contracted for, this was a breach of his contractual obligation. I would award nominal damages only however, which I fix at $1,000.

[172] With respect to completion costs, in calculating the amount due to Brumley I have deducted the value of the work that he had not yet performed. To award Bonilla cost to complete Brumley's work would amount to double counting.

[173] To the extent that additional work may have been necessary due to other shortcomings in Brumley's work (e.g. reframing a doorway) I would fix Bonilla's damages at $500.

(ii) Delay and mortgage costs

[174] I have concluded that both parties must bear some responsibility for the delays in progress of the work on this project. I assign 50 percent responsibility to each side. While there is no question that Bonilla made a number of changes to the project, thereby extending its duration, there is no logical explanation (on the material before me) for a considerable portion of the slow progress.

[175] Bonilla asserts that Brumley delayed the work by 16.4 weeks, that it took her another 4.6 weeks to resume construction after the lien was filed and that it took a further 4 weeks to finish Brumley's contract work to other contractors. In my view, those numbers are excessive. I would attribute no responsibility to Brumley for the 4.6 weeks delay in resuming the construction after Bonilla wrongfully terminated his services. I further do not accept that it took an additional 4 weeks to finish Brumley's work through other contractors. There is no clear evidence that the delay attributable to Brumley was 16.4 weeks.

[176] In my view, taking into account the gaps in continuous work reflected in the timesheets, the admitted other downtime and unexplained absences from the site, I would hold Brumley responsible for a total of 8 weeks' worth of delay.

[177] Bonilla calculated that the interest on her construction mortgage was $238.18 per week. I would therefore assess the damages payable to Brumley for Bonilla for delay for which he was responsible at 8 x $238.18 or $1,905.44.

[178] Bonilla also claims damages arising from her need to refinance the project consequent on the registration of the lien by Brumley. For the reasons described above, I find that the lien registration was entirely proper. I would therefore award Bonilla zero damages on this account.

(iii) Lien legal costs

[179] Once again, Brumley was entitled to proceed as he did. I would award zero damages on this account.

(iv) Lost materials

[180] For the reasons outlined previously, I find that Bonilla has failed to prove that Brumley is responsible for any materials missing from the site, or that any materials were missing at all. I therefore award her zero damages on this account.

(v) Consulting fees

[181] Bonilla's attendances at the site were to manage her own project. This was part of her overhead. In relation to this expense, I attribute no increased cost to Brumley's activities and therefore assess the damages of Bonilla on this account at zero.

(vi) Loss of market value of house

[182] It was Bonilla's theory that the modifications to the cathedral ceiling on the second storey significantly decreased the value of the property. She was unable to adduce any expert evidence to support that view.

[183] By contrast, Brumley called an expert witness who testified that the modification to the cathedral ceiling on the second floor had no impact on the market value of the property. I accept that uncontroverted evidence.

[184] In the circumstances, I assess the damages payable to Bonilla on this account at zero.

(vii) Costs of new copies of building permit drawings

[185] Bonilla failed to adduce evidence in support of this damage claim. In any event, I find no wrongful conduct on the part of Brumley in relation to the plans, given the wrongful termination of the contract by Bonilla. I therefore assess her damages on this account at zero.

(viii) Total damages recoverable by Bonilla

[186] The total of the damages proved by Bonilla as listed is $3,405.44

9. Calculation of amount(s) due between parties

[187] To recap, I have calculated the sum due by Bonilla to Brumley on account of the unpaid amounts due to him for the work performed at $19,365.81. In turn, I have calculated the damages payable by Brumley to Bonilla on account of his failure to perform specific aspects of the work as contracted and for delay at a total of $3,405.44. Subtracting the latter from the former, produces a net sum due by Bonilla to Brumley of $15,960.37. This is the amount owing by Bonilla to Brumley.

conclusion and disposition

[188] For the foregoing reasons, I award Brumley the net sum of $15,960.37. In arriving at that sum I have netted out any amount payable on the counterclaim. The counterclaim is therefore dismissed. In addition, Brumley is entitled to recover pre-judgment interest on the amount awarded to him, in accordance with the Courts of Justice Act.

[189] In relation to costs, if the parties are unable to reach agreement, I direct as follows:

(a) The plaintiff shall serve his bills of costs on the defendant, accompanied by written submissions within fifteen days of the release of these reasons.

(b) The defendant shall serve her response on the plaintiff within fifteen days thereafter.

(c) The plaintiff shall serve his reply, if any, within ten days thereafter.

(d) In all cases, the written submissions shall be limited to three pages, plus bills of costs.

(e) I direct that counsel for the plaintiff, Mr. Zochodne, shall collect copies of all parties' submissions and arrange to have that package delivered to me in care of Judges' Administration, Room 170 at 361 University as soon as the final exchange of materials has been completed. To be clear, no materials should be filed individually: rather, counsel for the defendant will assemble a single package for delivery as described above.

___________________________ Stinson J.

Released: July 10, 2012

COURT FILE NO.: CV-08-CT056666-0000

DATE: 20120710

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

Jason BRUMLEY and 1656679 ONTARIO LTD.

Plaintiffs

– and –

CONSUELO BONILLA

Defendant

REASONS FOR JUDGMENT

Stinson J.

Released: July 10, 2012