ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: CV-11-2022-00

DATE: 2013-07-03

B E T W E E N:

VERSA CONSTRUCTION LIMITED

Scott Crocco, for the Plaintiff/Responding Party

Plaintiff

• and -

2012241 ONTARIO LIMITED, RAVINDER CHAHAL and TORONTO-DOMINION BANK

B. Whealen, for Firm Capital Mortgage Fund Inc., assignee of the Defendant, Toronto-Dominion Bank/moving party

Defendants

HEARD: May 13, 2013,
at Brampton, Ontario

Price J.

Reasons For Order

NATURE OF MOTION

1Although Ravinder Chahal’s numbered company borrowed money from T-D Bank to pay Versa Construction, the contractor it had hired to build a medical building on its property, it never paid Versa fully for its work. Versa registered a lien on the property and when Firm Capital bought T-D’s mortgage that the numbered company had given it as security for its loan, it had to pay money into court as alternative security for the money Versa was owed in order to discharge Versa’s lien.

2Now Firm Capital is applying to get its money back from court by applying for summary judgment to have Versa’s action dismissed on the grounds that it was not entitled to register a lien for its claims, which had not been approved by the project’s architect, and did not register the lien within the time required by the Construction Lien Act, with the result that it has no reasonable prospect of success in the action.

BACKGROUND FACTS

3In February 2008, 2012241 Ontario Limited (“the numbered company”) entered into a contract with Versa to construct a 3-story medical building on its property at 50 Sunny Meadow Boulevard in Brampton, for a contract price of $8,000,000.00. T-D advanced the funds for the project, secured by a mortgage from the numbered company. The contract named Global Architect as the consultant for the project.

4Versa completed construction of the building, and on December 2, 2010, Global Architect issued a Certificate of Substantial Performance, which it published in the Daily Commercial News on December 7, 2010.

5Versa registered a Claim for Lien in the amount of $383,390.93 on March 30, 2011, 113 days after Global Architect had published its Certificate of Substantial Performance. The Claim comprised the following charges, which Versa says were approved by T-D, the lender and payment certifier for the project, after publication of the Certificate of Substantial Performance:

a) Charges for work that Versa did, pursuant to Change Orders;

b) Losses that Versa had incurred due to delays caused by the numbered company; and

c) A fine that the City of Brampton had imposed on Versa when it began work, on instructions from the numbered company, before the City had issued a work permit.

6Versa later registered a second Claim for Lien in the amount of $35,000.00, solely for the work it had performed pursuant to Change Orders issued after the Certificate of Substantial Performance had been published.

7Versa registered a Certificate of Action on May 16, 2011. Six months later, on November 15, 2011, the numbered company was placed in receivership.

8Firm Capital bought T-D’s mortgage on April 10, 2012. It later obtained an Order from Master Weebe of this Court, and approval from the Receiver, to continue T-D’s action to enforce its rights under the mortgage.

9Firm Capital, the major creditor of the numbered company, paid $433,398.93 into court, so that Versa’s Lien could be discharged from the title to the property. The amount it paid comprised of $383,390.93 that Versa claimed as the basis for its lien, and $50,000.00 for costs. When these amounts were paid into court, Versa’s lien was discharged.

10Firm Capital now moves for an Order dismissing Versa’s claim and directing that the money it paid into court be returned to it on the ground that Versa failed to register its lien by January 21, 2011, 45 days after Global Architect published its Certificate of Substantial Performance. This is the period in which the Construction Lien Act allows liens to be registered. Firm Capital argues that Versa’s Claim for Lien expired when it failed to register it within that period.

11Versa asserts that it continued work on the project after December 7, 2010, when the Certificate of Substantial Performance was published. It says that it performed this work pursuant to Change Orders, the last of which T-D, the lender and payment certifier, approved on March 29, 2011.

12Versa further asserts that T-D also approved Change Orders after the Certificate of Substantial Performance was published, for costs that Versa had incurred by reason of the numbered company’s delay of the project, and for a fine that the City of Brampton imposed on Versa after the Certificate was published. It argues that it was entitled to register a lien for these charges on March 30, 2011, as it did.

ISSUES

13The court must decide whether evidence sufficient to give it a full appreciation of the facts demonstrates that there is no genuine issue for trial. More particularly, the court must decide whether Versa was entitled to register a lien for claims that were approved by the lender instead of the architect, who was only party authorized by the contract to approve them, and after its work on the project had been substantially completed, and whether it registered its lien beyond the time authorized by the Construction Lien Act.

PARTIES’ POSITIONS

14Firm Capital asserts that:

(a) All of the invoices Versa issued for the work it performed pursuant to Change Orders were paid.

(b) None of the charges (for work done on Change Orders, for delay costs, or for the municipal fine) were approved by Global Architect, the only party the contract authorized to do so.

(c) Versa failed to register its lien within 45 days after Global Architect certified that work on the project had been substantially completed, as required by the Construction Lien Act.

15Versa asserts that it never received payment for the work it did under the Change Orders, and that T-D, the lender and payment certifier for the project, approved its charges for extra work, for delay costs, and for the municipal fine, after the project had been substantially completed. It argues that this gave rise to a new Claim for Lien, which Versa registered on March 30, 2012, as it continued to perform work that the numbered company had requested.

ANALYSIS AND EVIDENCE

16The Court of Appeal in Combined Air stated that there are three types of cases where summary judgment may be granted: (1) where the parties consent to summary judgment, (2) where the claim or defence has no chance of success, and (3) where the motion judge is satisfied that the issues can be fairly and justly resolved by exercising the powers in Rule 20.04 of the Rules of Civil Procedure. In disposing of cases under the second class, the motion judge may exercise the discretionary powers under Rule 20.04 to determine whether a claim or defence has no chance of success.¹

17In the present case, the court must consider whether the claim has any chance of success and whether the issues can be fairly and justly resolved by exercising the powers conferred on it in Rule 20.04.

a) Claim for work done under Change Orders

18Section 31(2)(a) of the Construction Lien Act provides that if a contractor performs work up to the date when a certificate of substantial performance is issued, it is entitled to a lien for the cost of the work, provided that it registers its Claim for Lien within the earlier of 45 days following publication of the Certificate of Substantial Performance, or actual completion or abandonment of the contract.

19Firm Capital argues that Versa was obliged to register its lien by January 21, 2011, 45 days following publication of the Certificate of Substantial Performance, for work done up to December 7, 2010, when the Certificate was published. It says that because Versa did not register its lien until March 30, 2011, its Claim was not properly preserved and should be dismissed.

20Versa claims $35,443.05 for the extra work it performed. It argues that because the numbered company did not issue its Final Change Order, number 51, and Joe Decicco, on behalf of Global Architect, did not approve it, until March 29, 2011, after Global Architect had issued its Certificate of Substantial Performance, and Versa therefore continued performing work on the project pursuant to Change Orders 42 to 51, which Firm Capital does not dispute, it was entitled to register its Lien on March 30, 2011, and to register its Certificate of Action on May 16, 2011.

21Of the amount of $35,442.05 which Versa claims for the extra work it performed, Versa claims $25,344.00 for invoices it issued under Change Orders 42 to 48. Ken Malcolm, a Senior Credit Manager for T-D, whose loan funded the project, states that the final amount of $79,535.00, which the numbered company drew from T-D under its mortgage on March 9, 2011, was for payment of the $25,344.00 charged under Change Orders 42 to 48, among other costs. However, the $79,535.00 was drawn by the numbered company, not by Versa, and there is no direct evidence that the numbered company actually paid any of the money it drew out to Versa.

22Firm Capital asks the court to infer from the fact that the numbered company, which is now bankrupt, claimed that it was drawing the money from T-D in order to pay Versa, that it actually used the funds for that purpose. However, there is no actual evidence that it did so. On the contrary, Versa has tendered an affidavit from its Vice-President of Operations, Matthew Montanaro, stating that Versa never received the amount that was owing to it.² This evidence is un-contradicted.

23Versa claims an additional $10,099.05 for work that it performed pursuant to Change Orders 49, 50, and 51. Mr. Decicco, of Global Architect, states that Global never received invoices from Versa for this work. Firm Capital argues that without invoices, the numbered company was not obliged to pay, and Versa is not entitled to a lien. Versa argues that because work on the Change Orders was ongoing when the Certificate of Substantial Performance was published, it was not required to issue an invoice before registering a lien for the work authorized by the Change Order that T-D had approved.

24Under section 31(4) of the Construction Lien Act, a contractor has a separate claim for lien for work done after publication of a Certificate of Substantial Performance.³ I am not prepared to find, based on the evidence filed, that Versa received the amounts it claims under Change Orders 42 to 48.

25I further find that on March 30, 2011, Versa continued to perform work that the numbered company had requested under Change Orders 49, 50, and 51, and that its claim for lien for this work did not expire on January 21, 2011, 45 days after the Certificate of Substantial Performance of the overall project was published. Versa’s claim for these amounts raises a genuine issue for trial.

26Firm Capital asserts that even if the court:

(a) does not accept that the numbered company paid the $25,344.00 to Versa for invoices it had issued under Change Orders 42 to 48, even though the numbered company had drawn funds from T-D for that purpose; and

(b) finds that Versa was entitled to register a lien for the $10,099.05 for work it performed pursuant to Change Orders 49, 50, and 51, even though it never issued invoices for these amounts, it should order that only the $35,443.05 associated with those Change Orders be retained in court until Versa’s entitlement to these amounts is resolved at trial, and should order that that the remainder of the funds be paid out of court to Firm Capital as assignee of T-D’s mortgage.

27That is, Firm Capital asserts that even if the court declines to order that the $35,443.05 that Versa claims in connection with the Change Orders for work performed be paid out to Firm Capital, it should order that the balance of the funds, paid as security for Versa’s claims for delay costs and for the municipal fine imposed on it, should be paid out to Firm Capital. I will deal separately with each of these claims.

b) Claim for costs incurred due to delay

28Versa argues that there are two issues in relation to the delay claim that require trial. One is whether the claim was approved; the other is whether Versa was entitled to register a lien for the claim when it did.

(i) Was the claim for delay costs properly approved

29Versa initially claimed $221,294.64 as costs it had incurred by reason of delays caused by the numbered company. It later increased this claim to $244,370.74. It is clear from the jurisprudence, and it is not disputed by T-D, that such a claim is properly made under the Construction Lien Act.⁴

30Versa asserts that in January or February 2011, in accordance with Article GC 6.5 of the construction contract, it submitted a Change Order to T-D, the lender and payment certifier, for approval of these delay costs.

31Article GC 6.5 of the contract provides, in part, as follows:

6.5.1 If the Contractor is delayed in the performance of the work by an action or omission of the Owner, Consultant, or anyone employed or engaged by them directly or indirectly, contrary to the provisions of the Contract Documents, then the Contract Time shall be extended for such reasonable time as the Consultant may recommend in consultation with the Contractor. The Contractor shall be reimbursed by the Owner for reasonable costs incurred by the Contractor as the result of such delay.

6.5.4 No extension shall be made for delay unless notice in writing of claim is given to the Consultant not later than 10 Working Days after the commencement of delay, providing however, that in the case of a continuing cause of delay only one notice of claim shall be necessary. [Emphasis added]

32Article A-6 of the Contract identifies “the Consultant” as Global Architect. Firm Capital argues that Versa’s claim for delay costs is invalid because Global Architect did not approve it. Mr. Montanaro, on behalf of Versa, states that Versa submitted a Change Order for the delay costs to Carlos Serra, the Payment Certifier for the lender, T-D, and the owner, Ravinder Chahal, for their approval. He states that Mr. Serra and Mr. Chahal approved the Change Order and that, on their direction, Versa issued an invoice to the numbered company on January 31, 2011.

33Firm Capital disputes Versa’s assertion that its claim was properly approved. It argues that Global Architect had sole authority under the Contract to approve such claims, and that it did not approve Versa’s claim for delay costs.

34The Contract entitles Versa to compensation for reasonable costs incurred as a result of delay caused by the numbered company or its consultant, Global Architect. The right to compensation is not contingent on approval. In The International Union of Painters and Allied Trades v. Buttcon Ltd., (2003), the Labour Relations Board was called upon to decide whether a worker who had voted for certification of a union was an employee, based on invoices that had been submitted for his work. The employer sought to disqualify the vote on the ground that the invoices had not been approved by a formal Change Order. In rejecting this argument, the Vice-Chair stated:

The Board is not so naïve as to expect to see every extra or change order approved in advance of the performance of the work. Ideally, any general contractor or project manager would like to operate in that manner. However, the exigencies of the real world of behind-schedule construction projects where problems develop often dictates otherwise.⁵

35The Contract in the present case imposes an obligation on Versa to notify the Consultant, Global Architect, of its intention to claim reasonable costs for the delay within ten days after the delay begins. Firm Capital disputes that Versa was entitled to give the required notice to Mr. Serra instead, and to obtain his approval of its claim, it does not explicitly say that the numbered company and Global Architect never received notification of the claim or approved it.

36Versa did not give evidence as to how Mr. Serra came to approve Change Orders in place of Global Architect. However, it did file the affidavit of Mr. Montanaro, who states that Mr. Serra, on behalf of T-D, the lender and payment certifier, approved the Change Orders on behalf of the numbered company. He gave a reasonable explanation for why it did not tender an affidavit from Mr. Serra himself (namely, that he had been transferred to the U.S. and could not be located in time for the hearing). Firm Capital asserts that the contract did not authorize Mr. Serra to approve the Change Orders.

37Was it an implied term of the construction contract that the numbered company could authorize T-D, the lender and payment certifier, instead of Global Architect, to approve a Change Order for costs that Versa had incurred by reason of unreasonable delay caused by the numbered company substitution for Global Architect, the consultant designated in the contract, as its agent for the purpose of approving a Change Order for costs that Versa had incurred by reason of unreasonable delay caused by the numbered company or its consultant? A court will generally imply a term in a contract only if the parties have not dealt with the matter in their agreement, and it is obviously necessary in order to give the transaction the business efficacy that both parties must have intended. Mere “reasonableness” does not satisfy the business efficacy test, and a term based on custom or usage in the industry will not be implied unless the facts support it.⁶

38Goldsmith, in Canadian Building Contracts, (4th Edition, Carswell, 1998), gives the following guidance with respect to the determination of when costs may be claimed for unreasonable delay:

...What is a reasonable time must be decided in light of all the circumstances relating to the contract, the specific work and conditions, and the general circumstances in which the contract was entered into...

...what is reasonable does not necessarily depend on the convenience of the contractor, but must be decided in the light of all the circumstances of the case...[ ^7 ]

39The court’s function when interpreting a contract is to determine the intention of the parties, as expressed in their written agreement.⁸ Evidence of one party’s intention is not determinative, and the court does not consider extrinsic evidence unless the contract is ambiguously worded.⁹

40The interpretation of the Contract is a legal matter. An expert will usually not be permitted to testify as to its meaning where it contains little technical language.¹⁰ This does not, however, preclude a witness from testifying about whether a term of the contract is consistent with industry practice. The court in the present case may find, based on such evidence, that the numbered company followed a practice, customary in the industry, of designating T-D, the lender and payment certifier, as its agent for the purpose of approving Change Orders in place of Global Architect, the Consultant named in the Contract.

41In M.J.B. Enterprises Ltd. v. Defence Construction (1951) Ltd., (SCC, 1999),¹¹ the Supreme Court of Canada confirmed that while the relationship between contracting parties is governed primarily by the express terms of their contract (tender documents, in that case), implied terms may be read into the contract, where necessary. The Supreme Court adopted its analysis from its earlier decision in Canadian Pacific Hotels v. Bank of Montreal, (SCC, 1987),¹² in holding that a term of the contract may be implied:

(i) based on custom or usage;

(ii) as the legal incident of a particular class or kind of contract; or

(iii) based on the presumed intention of the parties, where the implied term must be necessary to give business efficacy to a contract or as otherwise meeting the ‘officious bystander’ test as a term which the parties would say, if questioned, that they had obviously assumed.

42In the present case, neither party was able to offer any authority, either in the Construction Lien Act or in reported decisions interpreting it, as to whether, as a matter of law, a construction contract’s initial designation of a Consultant is conclusive in conferring exclusive authority to approve Change Orders. If the contract can be amended by implied agreement, an owner, by authorizing another party, such as the lender and payment certifier, for this purpose, may be estopped from later denying that party’s authority to approve extra charges, and others, such as Firm Capital, may be bound by approvals given by the substitute.

43Additionally, neither party gave evidence as to whether substitutions of this kind are common in the industry. Firm Capital asserts that the onus was on Versa to produce such evidence. It is true that Versa must “put its best foot forward” in a motion of this kind. However, this obligation does not require it to present all of the evidence that it may rely on at trial. If this were the onus, a motion for summary judgment would be no different from a trial, and would not avoid the time and expense associated with a trial. As Shaw J. stated in 1526183 Ontario Ltd. v. Grant Equipment Corp.¹³

Where, as in this case, the summary judgment motion is brought by a plaintiff, it must be clear to a motions judge that it is proper to deprive the defendant of its right to a trial. The purpose of the summary judgment rules is to avoid the expense of unnecessary litigation where the moving party has satisfied the court, on a review of the evidence and in the light of the provisions of Rule 20.04(2.1), that a trial is not required of a genuine issue in respect of material facts. The threshold issue before me is not how the issues raised by the plaintiff and the defendant should be resolved, but rather it is to determine whether there is a genuine issue requiring trial. [Emphasis added]

44In 1000728 Ontario Limited o/a Baron Finance v. Kakish, (2010), this court allowed a motion to transfer an action to the Superior Court on the basis that the defendant would be able to present evidence at trial of a customary practice in the shipping industry that departed from the sequence of transactions contemplated by two statutes that conferred protection on a carrier, and liability on an end consignee, for shipping costs. Spence J., concluded that the defendant had raised a genuine issue for trial, based on evidence that the defendant intended to call at trial regarding a customary practice that deprived the plaintiff of a statutory protection of its freight charges. He stated:

[The defendant] submits that a case like the present action is a complex one involving multiple parties and requiring the interpretation of various overlapping contractual arrangements. [The defendant] relies for this characterization on the reasons for decision of this Court in Saima Avandero S.p.A. v. Coppley Noyes & Randall Ltd., [2000] O.J. No. 2841 (S.C.J.) [where], [i]n determining that the end consignee did not owe the costs of a shipment, the Court undertook a detailed factual examination of the customary sequence of invoices and payments in the shipping industry, the relationships between the various parties involved in the action, and the various communications that took place between the parties….

… From the material before the Court, that would appear to be an entirely appropriate way for [the defendant] to seek to make full answer and defence to the claim against it.¹⁴

45In Deman Construction Corp. v. Magna International Inc., (2002), MacKenzie J. of this court found that correspondence between the parties effected a change in the respective obligations of the contractor, owner, and consultant in relation to the exceeding of an estimate of the fill load provided for in a construction contract.¹⁵ In upholding the trial judge’s decision, the Court of Appeal stated:

We read the trial judge’s reasons (paras. 24 and 36) as holding that adjustments to the contract price based on additional excavation and haulage costs were to be governed by the letter of June 3, 1997, which specifically anticipated those adjustments, and not by the terms of Article 12 of the contract, which governed work changes in general. We agree with this interpretation. The conduct of the parties at the time is entirely consistent with the trial judge’s interpretation.¹⁶

46In Frank & Sons Painting & Decorating Ltd. v. M2 Group Inc, (2010), Lalonde J., at the trial of a construction claim, allowed the plaintiff’s claim for extras based on approvals given orally on site, even though the Change Orders sent to the owner were never returned with its approval.¹⁷

47In all of the above cases, the court accepted that evidence of industry practice at trial may support a contractor’s claim even where the protocol set out in the contract for approval of extras was not followed. In the present case, as with the portion of Versa’s claim relating to work performed after publication of the Certificate of Substantial Performance, the evidence does not permit a full appreciation of the facts sufficient for the court to find whether it is the practice in the industry for an owner to designate someone other than the consultant named in the construction contract, and particularly a representative of the lender, as its agent for the purpose of approving extra costs and certifying payment. I conclude that there is a genuine issue for trial in this regard.

48I am not prepared to find, based on the evidence filed, that the delay costs that Versa has claimed are unreasonable, or that it is not entitled to a lien based on them. Versa has discharged the onus on it. Mr. Montanaro’s evidence that Mr. Serra approved the Change Orders satisfies me that there is a genuine issue for trial as to whether the Change Orders were properly approved. I am not satisfied, from the conflicting evidence on the issue, that Versa’s claim has no chance of success, based on the evidence it may tender at trial as to an implied term of the Contract and industry practice allowing a substitution of the lender and payment certifier as the numbered company’s agent for purposes of approving such Change Orders.

(ii) Was Versa entitled to register a lien for its delay claim?

49Firm Capital asserts that, since Versa’s claim for delay costs related to work done before Global Architect published its Certificate of Substantial Performance, this claim expired when Versa failed to register its lien by January 21, 2011.

50Versa argues that it was entitled to register a lien for this claim, because the delay costs related to both work done before the Certificate of Substantial Performance was published, and work performed later, under the Change Orders, and that its claim for delay costs is indivisible. It submits that the cost was approved by Mr. Serra, on behalf of the lender and payment certifier, and by Mr. Chahal, for the numbered company, and that Versa issued an invoice to the numbered company on January 31, 2011, after the Certificate of Substantial Performance had been published. On this basis, it submits that it was entitled to register its lien for the delay cost when it did.

51I am satisfied that there are genuine issues for trial as to whether a Change Order, approved after publication of the Certificate of Substantial Performance, and authorizing Versa’s charges for delay costs, is a valid basis for a lien claim and was properly registered.

c) Claim for fine imposed by the City of Brampton

52Versa claims $25,165.00 for a municipal fine that the City of Brampton imposed on it when Versa performed work before a Work Permit had been issued. It is Mr. Montanaro’s undisputed evidence that the numbered company instructed Versa to proceed with the work on the express understanding that the numbered company would be responsible for payment of any fines. It is further Mr. Montanaro’s undisputed evidence that the fine was issued on February 10, 2011, after publication of the Certificate of Substantial Performance, and that both Mr. Serra, on behalf of the lender and payment certifier, and Ravinder Chahal, on behalf of the numbered company, approved a Change Order for this fine to be charged to the numbered company as a cost of the project.

53Firm Capital relies on the proposition that the court should not enforce a claim that arises from an illegal agreement between Versa and the numbered company to begin construction before a work permit had been issued, in violation of the municipal by-law. It relies on the decision of the Court of Appeal for Ontario in Pupiec v. Dereniowki,¹⁸ (1998). That decision stands for the proposition that a lien cannot arise from a base cause. If people conspire to break the law, including a municipal by-law, they should not be permitted to make a claim based on their agreement. Firm Capital argues that Versa agreed with the numbered company to break the law and should not now be permitted to enforce the agreement. Firm Capital also denies that a Change Order for this cost was properly approved.

54Versa submits that the Firm Capital, as assignee of the numbered company’s mortgagee, should not be allowed to shelter itself from the numbered company’s liability by arguing that its agreement is unenforceable or not the proper subject of a lien.

55Neither party has offered evidence as to whether Versa was in possession of full knowledge of the facts that would have resulted in its liability for the fine. Additionally, neither party offered evidence as to whether it is a practice in the construction industry for the cost of a municipal fine arising from work undertaken before a work permit has been issued to be absorbed by the owner who instructs the contractor to proceed with its work.

56Neither party has offered any evidence or authority as to whether a property owner bears primary responsibility for ensuring compliance with municipal by-laws and whether, for this reason, the practice in the industry is to permit contractors to rely on instructions they receive from owners in this regard. In the absence of such evidence, the court does not have a full appreciation of the facts necessary to determine whether, as a matter of law, the fine imposed in the present case was the proper subject of a Change Order and lien.

57On a motion for summary judgment, the court should not determine substantive issues. In K. G. Baird General Contracting Ltd. v. 800001 Ontario Inc.¹⁹ (1990), Scime J. held that it was inappropriate to determine questions of fact on a motion, and that it is preferable that such an issue be left to the trial judge.

58Firm Capital must establish that Versa, as lien claimant, has no right or that it could not possibly succeed at trial.²⁰ It faces a high onus and if the Court is in any doubt, Versa’s claim must proceed to trial.²¹ In the present case, there was no cross-examination of the affiants of their affidavits, which there normally is where there is conflicting evidence. There is conflicting evidence in the present case with regard to the approval that Versa says Mr. Serra gave.

59Additionally, where the court’s finding as to whether the time limits in the Act were met depends on findings of credibility, the court has been reluctant to make such findings even based on documents and transcripts.²² In the present case, the court does not even have transcripts. I am not satisfied that Firm Capital has discharged the onus upon it in a motion of this kind.

60I am mindful of the fact that the Supreme Court of Canada currently has under reserve an appeal from the Court of Appeal’s decision in Combined Air. I am releasing the present decision at this time because, in my view, the result would be the same based on the earlier jurisprudence governing motions for summary judgment. The factual issues of whether the numbered company approved the Change Orders that are the basis of Versa’s lien claim, or authorized T-D to do so on its behalf, and whether Mr. Serra, on behalf of T-D, approved them, are genuine issues that require a trial. The determination of these issues will depend on the testimony of multiple witnesses, including Mr. Chahal, Mr. Montanaro, Mr. Serra, Mr. Malcolm, and Mr. Decicco. It requires findings of credibility that, in the present case, cannot fully or conveniently be made based on affidavits alone, especially in the absence of cross-examination. The determination of the issues requires live testimony to be heard by a trial judge. The issues cannot be determined fairly on a motion for summary judgment.

CONCLUSION AND ORDER

61Based on the foregoing, it is ordered that:

1. Firm Capital has leave to continue T-D’s action to enforce its rights under the mortgage by 2012251 Ontario Limited.

2. Firm Capital’s motion for summary judgment dismissing Versa’s action, and for an order directing payment of some or all of the money in court to it, is dismissed.

3. If the parties are unable to agree on costs, they may make written submissions, not to exceed four pages each, with Costs Outlines. Versa shall deliver its submissions by July 15, 2013. T-D shall deliver its submissions by July 31, 2013.

Price J.

Released: July 3, 2013

COURT FILE NO.: CV-11-2022-00

DATE: 2013-07-03

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

VERSA CONSTRUCTION LIMITED

Plaintiff/Responding Party

• and –

2012241 ONTARIO LIMITED, RAVINDER CHAHAL and TORONTO-DOMINION BANK

Defendants/Moving Party

Footnotes

1. 1Combined Air Mechanical Services Inc. v. Flesch, https://www.minicounsel.ca/oca/2011/764 at paras. 72 to 73
2. 2Affidavit of Matthew Montanaro, sworn January 30, 2013, at para. 20
3. 3H. Kirsh and M. Alter, A Guide to Construction Liens in Ontario, 3rd Edition (LexisNexis, 2011), pp. 109–111; Carosi Construction Ltd. v. Barrie & District Assn. for People with Special Needs (1997), 34 C.L.R. (2d) 275.
4. 4K-Line Maintenance & Construction Ltd. v. Municipality of Metropolitan Toronto et al., https://www.canlii.org/en/on/onsc/doc/1979/1979canlii1924/1979canlii1924.html
5. 5The International Union of Painters and Allied Trades v. Buttcon Ltd., https://www.canlii.org/en/on/onlrb/doc/2003/2003canlii41465/2003canlii41465.html
6. 6M.J.B. Enterprises Ltd. v. Defence Construction (1951) Ltd., supra.
7. 8Eli Lilly & Co. v. Novopharm Ltd., https://www.minicounsel.ca/scc/1998/791
8. 9Eco-Zone Engineering Ltd. v. Grand Falls-Windsor (Town), https://www.canlii.org/en/nl/nlca/doc/2000/2000nfca21/2000nfca21.html
9. 10Canadian National Railway v. Volker Stevin Contracting Ltd., https://www.canlii.org/en/ab/abca/doc/1991/1991abca287/1991abca287.html
10. 11M.J.B. Enterprises Ltd. v. Defence Construction (1951) Ltd., https://www.minicounsel.ca/scc/1999/677
11. 12Canadian Pacific Hotels v. Bank of Montreal, https://www.minicounsel.ca/scc/1987/55
12. 131526183 Ontario Ltd. v. Grant Equipment Corp., https://www.canlii.org/en/on/onsc/doc/2010/2010onsc928/2010onsc928.html
13. 141000728 Ontario Limited o/a Baron Finance v. Kakish, https://www.canlii.org/en/on/onsc/doc/2010/2010onsc538/2010onsc538.html
14. 15Deman Construction Corp. v. Magna International Inc., 2002 ON SC 13256
15. 16Deman Construction Corp. v. Magna International Inc., 2004 ON CA 59981
16. 17Frank & Sons Painting & Decorating Ltd. v. M2 Group Inc, https://www.canlii.org/en/on/onsc/doc/2010/2010onsc3179/2010onsc3179.html
17. 18Pupiec v. Dereniowki, 1998 ON CA 2070
18. 19K. G. Baird General Contracting Ltd. v. 800001 Ontario Inc. (1990), 40 C.L.R. 316
19. 20DCL Management Ltd. v. Zenith Fitness Inc., https://www.canlii.org/en/on/onsc/doc/2010/2010onsc5915/2010onsc5915.html
20. 21Ibid.
21. 22Ibid.
22. 7Immanuel Goldsmith and Thomas G. Heintzman, Goldsmith on Canadian Building Contracts, 4th ed.