COURT FILE NO.: CV-13-473812

DATE: February 18, 2014

ONTARIO

SUPERIOR COURT OF JUSTICE

IN THE MATTER OF the Construction Lien Act, R.S.O. 1990, c.C.30

BETWEEN:

MICAHEL SEREBRENNIKOV o/a NEPTUN LIGHT

Mark Wiffen, for the plaintiff,

Tel.: 416-792-3494,

Fax: 647-317-1515;

Email: mark.wiffen@wiffenlaw.ca.

Plaintiff

- and -

POWERUP INC. ELECTRICAL CONTRACTORS and THE GREAT-WEST LIFE ASSURANCE COMPANY

Gregory N. Hemsworth, for the added party, Neptun Distributors,

Tel.: 905-850-7000,

Fax: 905-850-7050,

Email: ghemsworth@csllp.ca.

Defendants

Paul Guaragna, for Powerup Inc. Electrical Contractors,

Tel.: 905-273-3300,

Fax: 905-273-6920

Eamil: pguaragna@pallettvalo.com

HEARD: February 12, 2014.

Master C. Wiebe

REASONS FOR JUDGMENT

(Trial of an issue)

I. BACKGROUND:

[1] This construction lien action was referred to me by judgment of reference given by Justice T. McEwen on April 23, 2013. It came before me by way of first trial management conference on September 9, 2013. At that time it became clear to me that there was only one serious issue in this action that needed to be resolved, namely the issue of which person or entity was entitled to be paid the remaining money ($147,776.60) owed by Powerup Inc. Electrical Contractors (“Powerup”) pursuant to a contract for the sale and delivery of induction light fixtures to Powerup for installation in a underground parking garage owned by The Great-West Life Assurance Company (“GWL”) at 5140 Yonge Street, Toronto (“the Property”).

[2] The plaintiff, Michael Serebrennikov operating as Neptun Light claims that he is the contracting party and that he is owed the money. He registered a claim for lien for the above noted amount and started a lien action. Powerup posted the aforesaid amount plus 25% of same as security for costs in order to vacate the Serebrennikov claim for lien. As a result, the action as against the GWL has been discontinued.

[3] Another entity, a company named 2271421 Ontario Limited carrying on business as Neptun Distributors (“Neptun Distributors”), claims that it is the contracting party and that it is owed the money. It did not register a claim for lien, but instead started an action (CV-13-476665) claiming a declaration of entitlement to the monies paid into court to secure the Serebrennikov claim for lien and other relief related to the partnership between Mr. Serebrennikov and Neptun Distributors.

[4] Neptun Distributors attended at the first trial management conference before me on September 9, 2013. It was not clear whether Neptun Distributors had been served with the Notice of Trial. I therefore ordered that that be done. I proceeded with the reference with the full participation of Neptun Distributors.

[5] There are two minor residual other issues: (1) Powerup’s back-charge of $6,600.83 on account of the alleged non-delivery of 4 non-motion fixtures, 35 allegedly defective non-motion fixtures and 4 allegedly dysfunctional motion sensors; and (2) the repayment to Powerup of the security for costs that Powerup had to post to vacate the Serebrennikov claim for lien, as Powerup asserts that it is not at fault for the non-payment of the aforesaid monies. Counsel advised that both of these residual issues would probably be resolved on consent once the contract issue was determined.

[6] As a result, the parties (including Powerup) recommended, and I proceeded to order, a trial of the following issue, to be conducted by way of a motion: “To whom is the money owed by Powerup concerning the subject contract to be paid – to Michael Serebrennikov o/a Neptun Light or to Neptun Distributors?”

[7] All agreed to be bound by my decision, although Powerup made it clear, and I stipulated, that Powerup need not partake in the trial. I set a schedule for the exchange of affidavits and the holding of cross-examinations on this issue, and scheduled the date of December 11, 2013 for the hearing of the trial.

[8] On or about October 3, 2013, Mr. Serebrennikov delivered his motion record containing an affidavit sworn by him on October 2, 2013 (“the First Serebrennikov Affidavit”). On or about October 29, 2013, Neptun Distributors delivered its responding motion record containing an affidavit of its principal, Victor Nicoletti, sworn October 24, 2013 (“the Nicoletti Affidavit”). On or about November 7, 2013, Mr. Serebrennikov delivered a supplementary motion record containing an affidavit sworn by him on November 7, 2013 (“the Second Serebrennikov Affidavit”). Counsel filed two transcripts, namely the transcripts of the cross-examinations of Messrs. Serebrennikov and Nicoletti that took place on November 20, 2013. Counsel advised that I could consult these transcripts as I saw fit. I have. Facta and books of authorities were served and filed.

[9] At the hearing of the motion on December 11, 2013, it became clear to me that I needed to hear the evidence of one, Bob Talbot, the principal of Powerup, as he was the one with whom Mr. Serebrennikov alleges he negotiated a contract. This allegation of a contract between Mr. Serebrennikov and Powerup contradicts the Powerup pleading which states that Powerup contracted with Neptun Distributors. Mr. Wiffen argued that I should disregard the Powerup pleading as Powerup is “adverse in interest” to Mr. Serebrennikov, an argument I had difficulty understanding as Powerup apparently does not care as to who is to be paid the money. I determined that I could not determine the veracity of the Powerup pleading or the contract issue itself without hearing the evidence of Mr. Talbot.

[10] Mr. Hemsworth advised that he had tried to summons Mr. Talbot to provide viva voce evidence, but that this was not possible as Mr. Talbot’s office advised that he was out of the country on vacation and would not be available at the time of the motion. I therefore adjourned the trial to February 12, 2014, required the attendance of Mr. Talbot to give viva voce evidence at that time, and imposed a schedule for the conduct of the trial to make this possible. I also made an order formally adding Neptun Distributors as a party to this action.

[11] On February 12, 2014, Mr. Talbot was present. He had been summoned by Mr. Hemsworth. Both counsel examined and cross-examined Mr. Talbot, and then proceeded directly into final argument. Paul Guarangna, counsel for Powerup, was present during Mr. Talbot’s evidence, but made no submissions, other than to remind me of the issue about the return of the security for costs.

[12] Mr. Hemsworth confirmed at this time that, if Neptun Distributors is found to be owed the money, it will not contest either the deficiency back-charge or the return of the security for costs to Powerup. Mr. Wiffen advised that, if Serebrennikov is found to be owed the money, he has not determined whether he will contest the deficiency back-charge. However, Mr. Serebrennikov will not contest the return of the security for costs to Powerup.

II. ISSUES:

[13] The issue to be determined in this trial again is the following: “To whom is the money owed by Powerup concerning the subject contract to be paid – to Michael Serebrennikov o/a Neptun Light or to Neptun Distributors?”

[14] The following sub-issues were raised in argument:

a) Who contracted with Powerup to supply the induction lights – Mr. Serebrennikov or Neptun Distributors?

b) If Powerup contracted with Neptun Distributors, was there a novation of that contract into a contract between Mr. Serebrennikov and Powerup?

c) If Powerup contracted with Neptun Distributors, did Mr. Serebrennikov or Neptun Distributors do the work of supplying the induction lights to Powerup?

d) If Mr. Serebrennikov did the work, does this create an obligation on the part of Powerup to pay Mr. Serebrennikov?

e) If Mr. Serebrennikov did the work, does this salvage the Serebrennikov claim for lien?

[15] I herewith find that issue (e) above is not a proper sub-issue of the issue to be determined in this trial, and I will therefore not deal with it. Furthermore, sub-issue (e), which was raised by Mr. Wiffen in argument, causes me some concern. Counsel advised at the first trial management conference that the trial of the stated issue would resolve this lien action, save and except for the small issues of the deficiency back-charge and the payment of the posted security for costs. This may now not be the case if there are residual lien issues to be resolved.

III. EVIDENCE:

[16] The key witness in this case was Mr. Talbot. I found him to be a credible witness. He is the principle of Powerup and has no stake in the outcome of this case. He was careful in delivering his testimony. He conceded where his memory was faulty, and consulted corroborating documents whenever possible. His recollection of key events, such the meeting he had with Mr. Serebrennikov to conclude the contract and the meeting he had with Mr. Serebrennikov to pay the deposit, contained important details (such as the place and surrounding circumstances). This added believability to his evidence.

[17] Mr. Wiffen argued that Mr. Talbot was biased against Mr. Serebrennikov as Mr. Serebrennikov was the one that liened the GWL property and initiated this action naming Powerup and GWL, thereby affecting Powerup’s reputation with GWL. I do not accept this. The evidence shows that Powerup posted security to vacate the Serebrennikov claim for lien, that this action was discontinued as against GWL, and that the fixtures were delivered and installed to the satisfaction of GWL. There is no evidence that Powerup’s reputation with GWL was adversely affected by these proceedings or that Mr. Talbot was biased against Mr. Serebrennikov. Furthermore, Powerup made it clear, as was confirmed by Mr. Talbot in his evidence, that it does not care as to who is paid the money.

[18] On the other hand, I found Mr. Serebrennikov’s evidence to have much less credibility. Firstly, he is a party to this action and obviously has a stake in its outcome. He was clearly not unbiased. Secondly, his affidavit had minimal corroboration on key points, such as the alleged breakdown in his relationship with Mr. Nicoletti, the alleged correspondence he had with Mr. Talbot, and most importantly the meeting he had with Mr. Talbot to conclude the contract. This lack of corroboration is telling in my mind as it was Mr. Serenbrennikov’s onus to prove that the Poweruup contract was with him, as he admitted to negotiating the contract initially on behalf of Netpun Distributors. Thirdly, in the transcript of his cross-examination, Mr. Serebrennikov stated several times that he did not care as to whether Mr. Nicoletti knew that Mr. Serebrennikov had contracted separately with Powerup. This indicates a lack of regard for transparency.

[19] As to Mr. Nicoletti’s evidence in his affidavit and cross-examination, I did not in the end rely on it heavily on key contentious issues, if at all. I did rely upon exhibits to his affidavit. Obviously, as principle of Neptun Distributors, Mr. Nicoletti has a stake in the outcome of this case. I would therefore treat his evidence with the same skepticism that I would Mr. Serenbrennikov’s, if I were to rely on Mr. Nicoletti’s evidence at all.

[20] In summary, I found the evidence of Mr. Talbot to be more credible that that of Mr. Serebrennikov. As a result, where the two conflict, I prefer the evidence of Mr. Talbot.

IV. ANALYSIS:

a) Who contracted with Powerup?

[21] This is the issue that was the focus of the trial. Both sides conceded that there was a contract, although not in writing, with Powerup.

[22] As to the law of contracts, I accept the following propositions for determining contract formation as outlined in the case of Remington Energy Ltd. v. British Columbia (Hydro and Power Authority)[2005] B.C.J. No. 695 (B.C.C.A.) at paragraph 31: the parties must indicate in actions and words an outward expression of an intention to contract and the terms of the contract; there must be a clear agreement of the essential terms of the intended contract; the conduct of the parties may be considered in determining whether a binding contract exists; and acceptance of an offer may be implied from conduct. As Mr. Wiffen argued, the standard to be applied to these factors is an objective one, namely whether a reasonable person observing the actions and hearing the words of the parties would draw the conclusion that they have agreed to a contract.

[23] As to the essential terms of a contract for the supply of goods, such as this one, there was no dispute that they would be the following: the quantities of the goods; the price to be paid for them; and the time of delivery.

[24] Applying these principles to the evidence in this case, I have made the following determinations on the key factual issues:

• Neptun Distributors was established in January, 2011, and Mr. Serebrennikov acted (initially at least) as a representative for Neptun Distributors in inter alia selling induction lighting fixtures. He used the name “Michael Breen.” Mr. Nicoletti was the sole shareholder and director of Neptun Distributors. There was no disagreement between the parties on these points.
• In 2012 GWL issued a public tender for the supply and installation of induction lighting fixtures in the Property. This tender closed in April, 2012. The name, “Neptun,” was stated in the tender documents as being one of two alternative types of fixtures to be supplied. Neptun Distributors telephone number was provided.
• Powerup was one of four bidders. As indicated in the Powerup pleading, and as confirmed by Mr. Talbot in his evidence, Powerup obtained quotations from various suppliers, including a quotation from Neptun Distributors dated April 10, 2012 (prepared by Mr. Serebrennikov) and a quotation from Nedco, a division of Rexel Canada Inc. (“Nedco”), a distributor, dated April 18, 2012. The Nedco price was lower than the Neptun Distributors’ price, and therefore Powerup carried the Nedco price in its bid to GWL. As a result, the law of tendering is not engaged, namely the issue of whether the tendering process created any obligation on Powerup to contract with Neptun Distributors.
• GWL awarded the contract to Powerup. Powerup’s pleading states that the contract between Powerup and GWL was entered into on or about August 2, 2012. This means that the award probably happened shortly before this time.
• After receiving the contract award, Mr. Talbot approached Mr. Serebrennikov in his capacity as Vice-President of Sales for Neptun Distributors. The witnesses were not clear when this happened. It makes sense that this would have happened shortly after the contract award, as time was very much of the essence. Mr. Talbot was clear in his evidence that the fixtures had to be installed before the end of 2012, and Powerup needed them supplied by the beginning of November, 2012 to make that possible. I find that the approach by Mr. Talbot to Mr. Serebrennikov happened by at least mid-August, 2012.
• There is then a divergence in the evidence as between Mr. Talbot and Mr. Serebrennikov. Mr. Talbot’s evidence was that he had a meeting at the offices of Neptun Distributors, that he initially met both Messrs. Nicoletti and Serebrennikov, that he went off into a separate room with Mr. Serebrennikov to negotiate a contract with Neptun Distributors, that the only remaining issue was price, that he, Mr. Talbot, knew that Neptun Distributors had quoted to Nedco as well as directly to Powerup, that he told Mr. Serebrennikov that Neptun Distributors could have the contract if it agreed to the discounted price it gave to Nedco, and that Mr. Serebrennikov, on behalf of Neptun Distributors, agreed to the contract at that discounted price once it was made clear that Neptun Distributor’s “money was safe” with Powerup given its relationship with GWL. Mr. Serebrennikov’s evidence was that Mr. Talbot rejected Neptun Distributor’s bid and advised that he would look elsewhere for a better price, and that he then did not reconnect with Mr. Serebrennikov for some time. For the reasons already stated, I prefer the evidence of Mr. Talbot on this point. In addition, given the exigencies of time and the fact that Powerup had already “rejected” the Neptun Distributors bid by carrying the Nedco price in Powerup’s bid, it makes no sense that Mr. Talbot would again reject the bid and allow this supply contract issue to drift.
• On August 24, 2012 Mr. Serebrennikov sent Mr. Talbot an email confirming an “order.” This indicates that a contract already existed. However, the email refers to the prices in the Neptun Distributors bid of April 10, 2012. It also required a 50% deposit, and asked as to whether that condition was acceptable. Mr. Talbot advised that he ignored the prices as he believed that the prices had already been agreed to. He was shocked and upset, however, by the 50% deposit requirement, as this would require an amendment to the GWL contract with Powerup which gave Powerup an entitlement to 50% payment no sooner than delivery. He stated that, to accommodate Neptun Distributors, he went back to GWL and got them to amend the GWL/Powerup agreement to allow for a 50% up-front deposit, which amendment Mr. Talbot showed to the court. Mr. Wiffen urged that the August 24, 2012 email showed that the contract formation happened after that date, which would be consistent with Mr. Serenbrennikov’s version of events. For the reasons already stated, I prefer Mr. Talbot’s evidence on this point.
• Mr. Serebrennikov advised that he then had a “breakdown in his relationship” with Mr. Nicoletti. Mr. Nicoletti denies such a breakdown. That there was a dispute between Messrs. Nicoletti and Serebrennikov seems clear from the evidence. This was admitted by Mr. Nicoletti in cross-examination. The cross-examination transcripts indicate that at the end of June, 2012 Mr. Nicoletti ceased having Neptun Distributors pay Mr. Serebrennikov the $3,000/month it had been paying him to that point. But the evidence was not sufficient for me to conclude that there was a complete parting of the ways between the two. Mr. Serebrennikov continued to work from Neptun Distributor’s premises. I note also that Mr. Nicoletti maintains that the $3,000/month was an advance on commissions and not a payment for services rendered. Therefore, I conclude, based on the evidence before me, that there was no complete “breakdown in the relationship” between Messrs. Nicoletti and Serebrennikov.
• On September 13, 2012 Mr. Serebrennikov registered the name “Neptun Light” in order to allow him to conduct business under that name. He had at one point been a sales representative for the Chicago based induction light fixture manufacturer, Neptun Light Inc. This clearly indicates that as of that date, Mr. Serebrennikov intended to strike out on his own. However, Mr. Wiffen urged more. He argued that on or about this time Mr. Talbot came back to Mr. Serebrennikov and had the meeting that resulted in the contract, and that in this meeting Mr. Serebrennikov advised Mr. Talbot that he, Mr. Serebrennikov, was now the contracting party under the name Neptun Light. This contradicts Mr. Talbot’s evidence, and, for the reasons already stated, I do not accept Mr. Serebrennikov’s evidence here.
• On September 20, 2012 Mr. Serebrennikov prepared an invoice for the entire supply of light fixtures at the agreed upon prices. The invoice was under the name Neptun Light. He sent an email to Mr. Talbot that day purporting to attach the invoice. The invoice was not attached. Mr. Talbot sent back an email to Mr. Serebrennikov the next day, September 21, 2012, requiring an invoice showing the deposit, as that was required before the deposit was paid. The quantities and prices specified in Mr. Talbot’s email were the same as in the Neptun Light invoice. This chain of emails was entered as Exhibit 1. Clearly, by this time the essential terms of the contract were in place. Clearly by this time Mr. Talbot had obtained the deposit money. This makes sense as it would have taken time to get the amendment to the GWL/Powerup contract.
• There is then another divergence in the evidence. Mr. Talbot clearly remembers meeting Mr. Serebrennikov in Mr. Talbot’s truck in order to give him the deposit cheque. The cheque had been issued by Powerup to Neptun Distributors. Mr. Talbot stated that that had been done because that was the party with whom Powerup had a contract. The meeting was hurried. Mr. Talbot stated that Mr. Serebrennikov did not have the invoice, and that he, Mr. Talbot, reluctantly delivered the cheque anyway again out of a concern about time. Mr. Talbot stated that he remembered this clearly because this was a deviation from his normal business practice. He then stated that Mr. Serebrennikov changed the name on the cheque to “Neptun Light” stating that “we’re going to do it in Neptun Light.” Mr. Talbot stated that he did not think twice about that act, as he interpreted Mr. Serebrennikov’s statement as indicating that Mr. Nicoletti had agreed to this. He added that he did receive the invoice at a later date. Mr. Serebrennikov’s evidence, implied and expressed, was that the name on the cheque was a mistake that both men agreed to correct with the name change. He was not clear on when he delivered the invoice. For the reasons stated above, I prefer the evidence of Mr. Talbot on this point.
• On September 24, 2012 Mr. Talbot emailed Mr. Serebrennikov (copying Boris Lev, a GWL representative) confirming the delivery of the deposit money and asking as to delivery dates in order to finalize the installation schedule. There is then an undated email from Mr. Serebrennikov to Mr. Lev advising that the delivery would take place during the week of November 18, 2012. In this email, Mr. Serebrennikov uses the Neptun Distributors name and address. Mr. Wiffen urged that without a date on this email, I should conclude that it was sent quite early, even before contract formation. I do not do so. It makes more sense that it would have been sent after the contract was formed and the deposit was paid. The fixtures would not have been ordered until that happened. The email was therefore probably sent in response to inquiries made by Mr. Lev following the September 24, 2012 Talbot email.
• Mr. Serebrennikov’s evidence was that he, using the name Neptun Light, deposited the deposit money in his own account, made the orders for the light fixtures from certain Chinese manufacturers, paid for the orders using the deposit money, and took delivery of the product. I accept that evidence, as it was not contradicted.
• At some point in December, 2012, Mr. Lev called Mr. Nicoletti and advised him of what had taken place. Mr. Serebrennikov in cross-examination asserted that Mr. Nicoletti somehow knew that Mr. Serebrennikov had struck out on his own in this project all along. There is nothing to corroborate that assertion and I do not accept it. Mr. Nicoletti did not make an issue of this news with Powerup and GWL, and Mr. Wiffen argued that this is circumstantial evidence that Mr. Nicoletti knew of the Neptun Light arrangement. A more plausible explanation offered by Mr. Hemsworth, which I accept, is that with the contract part performed, Mr. Nicoletti just wanted to have the contract completed and then deal with the issue.
• Finally, on January 2, 2013, Mr. Talbot sent an email to Mr. Nicoletti confirming that he had made the change of name on the deposit cheque, “not knowing any different.”

[25] In summary, looking at the presented evidence objectively, I have concluded that a contract was formed between Neptun Distributors and Powerup in mid-August, 2012 whereby Neptun Distributors was to supply the induction lighting fixtures. It follows that contractually Powerup is obligated to pay the monies in court (other than the security for costs) to Neptun Distributors.

[26] Mr. Wiffen argued that Mr. Serebrennikov made himself personally liable on the contract based on his personal intention. Mr. Wiffen relied upon the statement from the Fridman text quoted at paragraph 32 of the decision in Barnett v. Rademaker 2004 BCSC 1060, [2004] B.C.J. No. 1785 (B.C.S.C.). But in reading further from this judgment, the court made it clear that the issue of whether the agent can enter into a separate contract with the third party depends on whether the third party reasonably believed it was dealing with the agent directly. In this case, that was not the case. Powerup reasonably believed all along that it was dealing with Neptun Distributors.

b) Was there a novation of the contract?

[27] This issue came up in argument. As I have found that there was a contract between Neptun Distributors and Powerup as of mid-August, 2012, was there a novation of that contract later into a contract between Neptun Light and Powerup because of the later change that was made to the deposit cheque and the rendering of the invoice by Neptun Light. It is well settled law that a novation happens when parties to a contract agree to have it supplanted with another contract. It is also well settled law that for this to happen, the parties to the original contract must agree to bring that contract to an end. Neither party disputed these propositions.

[28] Based on the presented evidence, I find that there was no such novation. When Mr. Talbot agreed to the change in the cheque, he thought, based on what Mr. Serebrennikov told him, that the change in name had been approved by Mr. Nicoletti. In other words, Mr. Talbot thought he was still dealing with the party Powerup had a contract with, namely Neptun Distributors.

c) Did Neptun Light do the contract work?

[29] This issue was raised by Mr. Wiffen as a part of his argument that Mr. Serebrennikov was entitled to payment from Powerup regardless of how the contract issue was determined. There is no doubt that Mr. Serebrennikov performed the work required of Neptun Distributors under the contract. He received the deposit money, used it to make the required orders, pursued the orders, and took delivery of the product.

[30] The issue, upon reflection, appears to be whether or not Mr. Serebrennikov did this work as an agent of Neptun Distributors. Based on the principles of agency law described in the Fridman text referred to in the above noted Barnett decision at paragraphs 26 to 32, I find, based on the evidence presented, that Mr. Serebrennikov acted throughout as agent for Neptun Distributors, and that Neptun Distributors consequently did the work.

[31] The issue turns on what third parties could reasonably conclude from Mr. Serebrennikov’s conduct. I have found that, while there was a dispute between Messrs. Serebrennikov and Nicoletti, there was insufficient evidence of a complete “breakdown in the relationship” between the two. Mr. Serebrennikov continued to work from the premises of Neptun Distributors. He continued to do the work he had been doing for Neptun Distributors from the beginning, namely the work of selling lighting fixtures. He continued to use the name and address of Neptun Distributors in business correspondence, as evidenced by his email concerning delivery dates. He did not inform Mr. Nicoletti that he had started using a different name with Powerup. In fact, he led Powerup to believe that this new name had been approved of and was being used by Neptun Distributors.

[32] Therefore, when Mr. Serebrennikov used the Neptun Light name with other third party contractors to fulfill the obligations of the Neptun Distributors contract, it was at most as an agent for the undisclosed principal, Neptun Distributors. In doing so, Mr. Serenbrennikov exposed himself to personal liability to these third parties along with Neptun Distributors. In some cases, in fact, the existence of the principal, Neptun Distributors, appears to have been disclosed. In Mr. Nicoletti’s affidavit there is a collection letter (dated July 5, 2013) from a shipping company addressed to “Neptun Distributors,” not Neptun Light.

d) If Mr. Serebrennikov did the work, would he be entitled to payment?

[33] If I am wrong in my above noted conclusion, and if Mr. Serebrennikov in fact acted on his own behalf in fulfilling the contractual obligations of Neptun Distributors, that does not, in my view, create an independent obligation on the part of Powerup to pay Mr. Serebrennikov. Mr. Wiffen argued that it did, on the basis of quantum meruit and unjust enrichment. I note that Mr. Serebrennikov’s Statement of Claim includes a claim for recovery of the subject monies from Powerup on the basis of unjust enrichment.

[34] In my view, unjust enrichment would not apply to this case in any event. To establish unjust enrichment (or even quantum meruit) as against Powerup, Mr. Serebrennikov would have to show that Powerup has been somehow enriched by the actions of Mr. Serebrennikov unjustly. That cannot be the case where, as here, Powerup will have paid in full for the supply of the lighting fixtures to the party that is contractually obligated to supply them, namely Neptun Distributors.

[35] There may be issues of accounting as between Neptun Distributors and Mr. Serebrennikov once Powerup pays the money to Neptun Distributors; but that is not the subject matter of this action as pleaded.

V. CONCLUSION

[36] This court, therefore, finds and declares that the issue that is the subject matter of this trial is determined as follows: the money that is owed by Powerup should be paid to Neptun Distributors, not Mr. Serebrennikov. This finding will be embodied in an interim report.

[37] At my direction, counsel exchanged costs outlines at the conclusion of argument concerning the costs they were claiming for this trial (and action). These documents were not filed.

[38] This court directs the parties to attend before the court on Friday, February 28, 2013 at 10:30 a.m. at the 6th floor, 393 University Avenue, Toronto to make submissions as to costs, and to finalize the interim report. 1 ½ hours will be reserved for this. If a party fails to attend without having been excused from attendance, the court will proceed in their absence to fix costs and settle the interim report.

___________________________

MASTER C. WIEBE

Released: February 18, 2014

COURT FILE NO.: CV-13-473812

DATE: February 18, 2014

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

Michael Serebrennikov o/a Neptun Light.

Plaintiff

- and -

Powerup Inc. Electrical Contractors and The Great-West Life Assurance Company

Defendants

REASONS FOR JUDGMENT

Master C. Wiebe

Released: February 18, 2014