ONTARIO

SUPERIOR COURT OF JUSTICE

BARRIE COURT FILE NO.: CV-08-0340
DATE: 20121005

IN THE MATTER OF the Construction Lien Act , R.S.O. 1990, Chapter C.30 , as amended to date

BETWEEN:

WORLD STONE & TILE INC. Plaintiff – and – TRACY LYNN EZEKIEL and WAYNE EZEKIEL Defendants AND BETWEEN: TRACY LYNN EZEKIEL and WAYNE EZEKIEL – and – WORLD STONE & TILE INC. and BIAGIO GUARASCIO

J. Botelho, for the Plaintiff (Defendants by Counterclaim)

W.M. Adams, for the Defendants (Plaintiffs by Counterclaim)
HEARD: November 28, 29, 20, December 1, 2, 2011 and May 22, 2012

McISAAC J.

[ 1 ] This is a construction lien claim for a new home tile installation and a counterclaim for damages for defective workmanship in that installation.

BACKGROUND

[ 2 ] Tracy Lynn Ezekiel is the registered owner of the subject property located in Innisfil. In 2007, she and her husband, Wayne, undertook the construction of a residence on Shoreview Drive in that municipality. This home was not only intended to be the Ezekiel family residence, it was also to serve as a “showcase” of Wayne Ezekiel’s skills as a “high-end” quality home contractor. The parties agree that a contract was entered into on September 3, 2001 for a total amount of $24,056.70 inclusive of GST. That document included the following term: “All work to be completed in a workmanlike manner according to standard practices.” The plaintiff alleges that the defendants requested “extras” in the amount of $10,842.00 plus GST leaving a net claim of $22,440.80 following instalment payments.

[ 3 ] The plaintiff admits that the defendants paid $13,000.00 on account of the original contract. They insist that this amount exceeds the value of the defective work provided and they categorically deny the claim for any “extras”. In addition, they deny any involvement with the corporate plaintiff and insist that they dealt with Biagio Guarascio in his personal capacity as a sole proprietorship. As such, their counterclaim for damages is against both World Stone & Tile Inc. and Mr. Guarascio personally.

ISSUES

[ 4 ] As I see it, the issues calling for resolution are the following:

1. Should leave be granted pursuant to s.7(1) of the Business Names Act , R.S.O. 1990 c.B-17 to permit World Stone and Title Inc. to continue this proceeding?

2. Was this tile installation conducted “in a workmanlike manner according to standard practices”?

3. If not, how is that deficiency to be quantified in damages? and

4. Was the claim for lien filed in time?

ANALYSIS

I. Leave Under the Business Names Act

[ 5 ] Wayne Ezekiel testified that he was unaware that Mr. Guarascio’s business was an incorporated entity until the lien was filed on February 11, 2008. All of the negotiations were conducted under the letterhead of “World Stone & Tile” as was the contract entered into on September 3, 2007. He assumed he could rely on the personal assurances as to the quality of superior workmanship advanced by Mr. Guarascio as opposed to them being avoided by means of this form of limited liability.

[ 6 ] Section 7(2) of the Business Names Act (the “Act”) states the court shall grant leave if the person seeking to maintain the proceeding satisfies the court that,

a. the failure to register was inadvertent;

b. there is no evidence that the public has been deceived or misled; and

c. at the time of the application to the court, the person is not in contravention of this Act or the regulations.

[ 7 ] Needless to say, Biagio Guarascio is seeking leave to maintain this proceeding in the name of World Stone & Tile Inc. and, as such, bears the onus of satisfying me of these three conjunctive factors.

[ 8 ] He has offered no evidence whatsoever on the first and third factors. The only evidence before me on the second factor is that of Wayne Ezekiel who testified that he was, in fact, misled as to the status of Mr. Guarascio having assumed he was dealing with a sole proprietorship. Assuming without deciding that there exists a residual discretion to grant leave outside the ambit of s.7(2) of the Act , I am not satisfied that there are any exceptional circumstances justifying the granting of leave given the disciplinary purpose of this legislation: see Bazinet v, Kinross Gold Corp. , 1999 Carswell Ont. 584 (Ont. Ct. of Justice, Gen. Div.) . I find Mr. Guarascio’s suggestion that he forwarded insurance and WSIB documentation containing the full corporate name to Mr. Ezekiel weak and unconvincing given the defendant’s denial of their receipt and absence of any support of their alleged transmittal such as a “fax” or e-mail record.

[ 9 ] In the result, the application to continue this proceeding in the name of World Stone & Tile Inc. is dismissed.

II. Workmanlike Manner

[ 10 ] Despite the claimed expectation on the part of Mr. And Mrs. Ezekiel that their tile work would be done to a “Bellagio” standard, the document that governs their relationship with Mr. Guarascio is the contract that was entered into on September 3, 2007. I repeat that it only required his work to be done “...in a workmanlike manner according to standard practices”. Two experts were permitted to testify on this issue.

[ 11 ] The defendants allege three separate areas of defective workmanship in this tile installation:

• the kitchen floor tile was not only misaligned, it lacks structural integrity;

• there is “lippage”, that is, unevenness in the mudroom and hallway tile installation; and

• there is misalignment in the tile installation in the master ensuite bathroom.

[ 12 ] The defendants’ expert, Domenic Zavarella, testified that, in his opinion, the appropriate standard to apply to this installation was that of the Terrazzo, Tile and Marble Association of Canada (“TTMAC”) where he is employed as a technical consultant. It suggests that, given the “high-end” nature of this residence, the standards dictated by TTMAC should be the minimum that should be applied in assessing this counterclaim.

[ 13 ] On the other hand, the opposing expert, Mark Roccatagliata, who had been employed as a Claims Field Manager for the Tarion Home Warranty Corporation (“Tarion”) for 20 years ending in February, 2008, suggested that the Tarion standards should be applied.

[ 14 ] In both of his reports dated May 23, 2008 and December 13, 2010 respectively, Mr. Zavarella noted in each concluding paragraph that TTMAC was “...an independent third party organization committed to the highest levels of materials and installation methods and as such takes a best practices approach to all inspection and installation recommendations.” (my emphasis added). In my view, this benchmark far exceeds the term used in the contract governing the relationship between these parties, that is, “standard practices”. Accordingly, I am prepared to accept the suggestion of Mr. Roccatagliata that the Tarion tolerances fairly approximate that phrase.

[ 15 ] The defendants’ first complaint in relation to the kitchen tile installation involves the suggestion that it was misaligned from the 45 degree that flowed subsequently from the later kitchen cabinet installation. Mr. Ezekiel and Mr. Guarascio are diametrically opposed in their recollections of these events. The defendant testified that Mr. Guarascio knew that a 45 degree patter was required because he had put a copy of the plan on the wall of the kitchen and he assumed the tile installer would reference this before starting work. He had marked out a future carpeted family area simply as a guideline. He recalled that Mr. Guarascio had a new tool which he used to lay out the alignment of the tiles.

[ 16 ] Mr. Guarascio recalls that his only instruction from Mr. Ezekiel was to use a diagonal brick pattern and there was no specification for a 45 degree angle. Mr. Ezekiel was present when he used his laser to set his points and drew his chalk line having referenced the proposed family area as his starting point. Based upon this understanding, he proceeded with the installation which was subsequently covered in paper as protection for later trades. The first he knew of any complaint about this alignment was following the installation of the kitchen cabinets which disclosed this discrepancy: see Exhibit 2, Tab 13.

[ 17 ] I am prepared to accept that Mr. Guarascio’s recollection of these events is preferable to that of the defendant for the following reasons. First, Mr. Ezekiel concedes that the family area had been delineated in some fashion before or at the time he had these discussions with the tile contractor. More importantly, he conceded that Mr. Guarascio had a specific tool that we now know was his laser to set out this alignment. Although in hindsight it may have been more prudent to confirm the location proposed for the kitchen cabinetry, I am not persuaded that it was unworkmanlike for Mr. Guarascio to assume that Mr. Ezekiel was confirming his proposed alignment. Nor am I persuaded that there was an obligation on his part to “second-guess” the instruction from his general contractor/“owner”.

[ 18 ] The structural complaints in relation to the balance of this tile installation are particularized by the defendants as “lippage” or unevenness in the kitchen and mudroom/hallway areas, insufficient bonding of the kitchen tiling resulting in cracking and misalignment in the ensuite bathroom. Mr. Guarascio does not deny that there was lippage in some of the kitchen tiles after his installation but insists he cured this problem by honing the affected areas and thereby eliminating the unevenness. However, I accept the evidence that this honing process has created its own set of problems by leaving an unsightly “window frame” effect and pitting in the tiles themselves. This is unsightly and makes cleaning the tiles difficult. More importantly, numerous tiles have been affected by cracking. Although initially being blamed by Mr. Roccatagliata on “settling” of the house, I accept the evidence of Mr. Zavarella that these emerging defects are attributable to the failure of the tile installer to assure a sufficient bond between the tiles and the underlay. Although Mr. Roccatagliata felt there was sufficient bonding to avoid the observed cracking, he can give no explanation for this problem. On the other hand, Mr. Zavarella does provide a reasonable explanation for them flowing from the voids that have been created by the incomplete adhesion which has remained under the tiles that are susceptible to stress and eventual cracking. In particular, he states on page 2 of his December 13, 2010 report that the “spot method” of adhesion used by Mr. Guarascio had not been approved by any mortar manufacturer in North America: see Exhibit 13.

[ 19 ] Accordingly, I find the evidence of Mr. Zavarella more compelling on this issue and I do accept it over the competing evidence of Mr. Roccatagliata who appeared prepared to defer his general knowledge to that of the defendants’ expert’s specialized knowledge. As a result of that conclusion, I am satisfied that, on this aspect, the kitchen tile installation did fall below the standard of being workmanlike according to the standard practices.

[ 20 ] Both sides’ experts noted lippage in the hallway area tile installation. I do not accept Mr. Zavarella’s TTMAC “recommendation” of a 1mm tolerance as being reflective of “standard practice”. It is clearly advanced as a “best practice”. On the other hand, the Tarion tolerance is set at 2mm. I am prepared to accept this benchmark as a “standard practice” in this Province. In his report dated August 11, 2012, Mr. Roccatagliata has photographed two tiles that breach this standard: see Exhibit 1, Tab 10, Picture 15. Accordingly, I am prepared to accept that the workmanlike standard has been breached to this extent.

[ 21 ] I turn now to consider the complaints in relation to the master ensuite bathroom. The defendants suggest that the tiles are “askew” as evidenced in Exhibit 2, Tabs 18-20. According to Mr. Adams’ written submissions, these discrepancies are not only unsightly but they also offend the Tarion minimum standard of tolerance. For myself, having reviewed the photographic evidence meticulously, I do not see any basis for the defendants’ complaint other than for one instance of excessive tile lippage as detailed in Picture 20 of Mr. Roccatagliata’s report: see Exhibit 1, Tab 10. This is the only breach of workmanship that I am prepared to assign to this aspect of the tile installation.

III. Damages

1. Claim

[ 22 ] The defendants do not contest that they owe the balance outstanding on the original invoice of $11,056.70, subject to their counterclaim. However, they do not accept the claim for “extras” totalling $11,384.10, suggesting that the invoice supporting it is punitive, excessive and/or non-compensable: see Exhibit 1, Tab 8.

[ 23 ] In the supporting “extras” invoice, there is an entry for $3,450.00 plus tax in the total amount of $4,172.50 for “kitchen honed floor and resealed”. Since I have found that this “extra” was related to the defective “lippage” in this part of the installation, it is not a charge for which the defendants are liable. As well, in the absence of any particulars for the $900.00 plus $45.00 tax claim for “time spent with designer”, I am not prepared to allow it. The two claims for tiling of the garage and basement bonding along with the drypack for the electric flooring in the kitchen were not included in the original invoice and were only added to it on a “no cost” basis when the two sides attempted to resolve this matter amicably in November, 2007. Accordingly, I am prepared to allow these claims along with the balance of the items on the invoice dated February 1, 2008. In the result, I assess the total claim in the amount of $17,878.30 inclusive of tax.

[ 24 ] Turning to the counterclaim, the major item relates to the kitchen tiling which the defendants say must be totally replaced including the electric flooring which underlays it. Although this part of the counterclaim may have appeared excessive upon first impression, I am persuaded that it is the only reasonable way to rectify this defective tile installation. Give the continuing and emerging evidenced of defective tiles, I do not view “spot” replacement as a reasonable solution. The entire floor has to be removed and replaced. Mr. Zavarella has recommended, as well, the replacement of the electrical heating system in the floor. I am prepared to defer to his opinion and experience in this regard. Unfortunately, this repair will necessitate the temporary removal of the kitchen cabinetry along with total replacement of the granite countertops. This results in the following calculations in relation to the kitchen, some of which I have pro-rated:

Labour and material $10,382.00

Cabinetry/countertop $21,975.00

Electrical $ 6,220.00

Plumbing $ 700.00

Drywall/caulking $ 5,600.00

Total $44,877.00

[ 25 ] Insofar as the three tiles in the hallway and master ensuite, I have not been persuaded that those deficiencies require total replacement of both floors as is the case with the kitchen. Although it may be difficult to find tile of similar colour, it has not been proved that it would be impossible to do so. In the absence of any evidence to replace these tiles, I fix the amount of $750.00 as being appropriate. That results in a total assessment of the counterclaim in the amount of $45,627.00.

IV. Timeliness of Lien

[ 26 ] Although this issue is somewhat moot in light of the findings made, I will deal with it given the submissions advanced by both sides.

[ 27 ] Mr. Ezekiel ordered Mr. Guarascio and his people off the job site on November 6, 2007: see Exhibit 2, Tab 10. Although there appeared to have been a reconciliation three days later, neither Mr. Guarascio nor any of his men did any work on the job site except for December 28, 2007 when some minor clean-up was done outside the house which was vacant. He had sent an e-mail on December 6, 2007 stating that the job was “99.9% completed”. The lien was filed on February 11, 2008.

[ 28 ] It is clear that when both sides “reconciled” on November 9, 2007, there was going to be an attempt to rectify the misalignment in the kitchen tiles. However, nothing was done to do so. When Mr. Guarascio’s men attended the defendants’ residence near the end of December, they only cleaned up some concrete splashes that had been caused during their earlier work. I agree with Mr. Adams that this remedial effort cannot extend the time limits for filing a lien: see Micon Interiors General Contractors Inc. v. D’Abbondanza Enterprises Inc. , 2008 Carswell Ont. 6156 (S.C.J.) at para. 49 .

[ 29 ] In the result, the lien herein was improvidently filed as it had lapsed under the statute.

V. Conclusion

[ 30 ] For all of these reasons, the defendants shall have judgment against Biagio Guarascio in the amount of $27,753.70. They will have 30 days following the release of these reasons to file their written submissions on costs and those of Mr. Guarascio are to be filed 15 days thereafter.

McISAAC J.

Released: October 5, 2012