ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: C-976-10
DATE: 2014-07-30
B E T W E E N:
TRS Components Ltd.
Wade. W. Sarasin, for the Plaintiff
Plaintiff
- and -
Devlan Construction Ltd., The Trustess of Knox Presbyterian Church, Waterloo, Pace Savings & Credit Union Limited and Education Credit Union Limited
Robert J. Kennaley, for the Defendant Devlan Construction Ltd.
Defendants
HEARD: November 25 and 26, 2013 and June 16, 17, 18, 19, 2014
THE HONOURABLE MR. JUSTICE P.J. FLYNN
REASONS FOR JUDGMENT
The Action
[1] This trial, which was heard during six days in November 2013 and June 2014, dealt with the Counterclaim of Devlan Construction Limited (Devlan) against the Plaintiff TRS Components Limited (TRS), for set off and for payment for the amount by which Devlan’s cost to complete the work not performed by TRS and Devlan’s cost to remedy TRS’ deficiencies exceeds any sum which may be owed to TRS pursuant to the subcontact.
[2] During the second day of the trial, the parties sought and obtained an adjournment so that they could talk about shortening the trial or resolving the issues. Obviously, that didn’t work and we continued after a seven month hiatus.
The Dispute
[3] In October 2009, Devlan issued a purchase order (P.O.) to TRS for framing work on Knox Presbyterian Church in Waterloo, Ontario, for the amount of $392,000.
[4] The project was quite unique, in that the entire structure was constructed of wood.
[5] The P.O. required TRS “to provide all required supervision, labour, materials and equipment to fully complete the following as per drawings, specifications and addendums 1 thru 5 as prepared by Baird Sampson Neuert Architects.”
[6] Then, using TRS’ own language (actually that of its corporate predecessor), it set out that TRS was:
“to supply full package including roof system, floor system, loose lumber, all wood and related items and framing labour.”
[7] Needless to say, TRS did not complete the project.
[8] It had subcontracted its installation work to a Leamington concern, Erieview.
[9] By the end of February 2010 the project was seriously running behind schedule. The Erieview crew were routinely arriving late and leaving early. The framing work contemplated by the P.O. was to take seven weeks from February. But by June it was still not complete.
[10] So Devlan’s project manager, Anderson, told TRS’ sales manager, Salo, that he was going to bring in another framing crew to expedite the work. He expected the TRS crew to continue on the job alongside the new crew.
[11] But, of course, that did not happen.
[12] The new crew, from Murray Albrecht Carpentry, completed the framing work and remedied the deficiencies. But the Erieview crew stopped working altogether. And Salo no longer came to the site meetings. TRS had, in fact, abandoned the project.
[13] Subject to Devlan’s claim, the parties agree that the starting point in this dispute is that the amount outstanding on TRS’ subcontract is $98,495.32. But the parties are far apart on where the matter goes from there.
[14] Devlan claims that the cost of completing TRS’ work, including fixing the deficiencies, amounts to $192,461.69 and that it is entitled to payment from TRS of a maximum of $93,966.37 or a minimum of $30,895.60, depending upon whether I find that soffit work is within or outside of the framers’ scope and whether I find that the roof ponding problem was something to be attributed to TRS.
[15] Devlan’s view of the world in approaching the calculations is set out in the annexed Schedule A Schedule to Devlan’s Submissions on Damages.
[16] On the other hand, TRS’s view is that the cost of completion only amounts to $86,330.37 meaning that Devlan would yet be required to pay TRS $12,164.95. This calculation presumes that both the soffit work and the roof slope rectification work are not within the scope of work for which TRS was contracted. The TRS world view is shown in the annexed Schedule B TRS’ Submissions on Schedule to Devlan Submissions on Damages.
[17] The parties do agree that the charges set out on the Devlan Schedule A, for the following are correct:
Expert carpentry
HJM
Home Hardward
Lloyds
Nietsch
Rosmar
Praxy
[18] But the significant remaining differences exist because of the dispute between the parties about whether TRS was responsible for the wooden soffits and whether it was solely responsible for fixing the ponding problems on the roof.
The Soffits
[19] It is a fact that the Albrecht crew completed the soffit work and that the value of that work did not exceed $14,000. There is no real accurate breakdown of the work that the Albrecht crew did because Murray Albrecht simply kept track of hours that his crew worked and they often were working on more than one thing at the same time.
[20] But TRS says soffits are not within its scope of work.
[21] Before TRS left the site, Anderson and Salo argued about this very thing and Salo refused to have the TRS crews do the soffit work. It is fair to say that if TRS had remained on site, it would have only done the soffit work if it had been paid extra for it.
[22] So TRS says that Devlan cannot deduct this from what is owing to them. Moreover, if TRS isn’t responsible for completing the soffits, there are other amounts that ought to be removed from Devlan’s (Schedule A) costs to complete, namely from Harrons for the cost of MDO material, some $5062.50 and from CRS, $2061.12 for boom lift rentals relating to the soffits.
[23] Salo testified that TRS never installs soffits and that he did not even know was MDO is, let alone supply or install it. He said that since it is found in the Architectural Woodwork section of the specification, TRS would not be responsible for it. He said that Anderson asked him later in the project to install the soffit but he refused to it. Further, he said that TRS was never asked to price the soffit work.
[24] Opposite to this, Anderson testified that soffits are always done by framers.
[25] Moreover, Devlan’s estimator, Durigon, testified that he understood soffits to be part of the “roof system” which is clearly spelled out as TRS’ responsibility on the P.O.
[26] Durigon testified further that soffits were not in the millwork scope. He referred to the language of the P.O. But it is a fact that MDO is only referred to in the specification for Architectural Woodwork (section 06400) at item 9. This is one of the types of wood material that are to be supplied for each type of woodwork and quality grade indicated in that specification. MDO is medium density overlay and it is lumped with exterior soffit plywood in that section of the specification.
[27] Now, Durigon remembers a specific discussion with Salo about carrying in the TRS bid exterior soffit plywood. According to his evidence, this was at a face-to-face meeting. But Salo testified that he had only dealt with Durigon by telephone or fax.
[28] I do have some great difficulty in making a credibility ruling between these two. Both of them testified in a straight forward fashion and without corroboration it is hard for a finder of fact to make a determination about who is right or wrong on the meeting issue. So I must simply say that I believe that there existed a failure to communicate.
[29] The project architect, Clark, was not of assistance in this matter.
[30] Nor did either side call any expert on the interpretation of the job specifications or the customs of the trade which might have been of some assistance to the court.
[31] In my view, the onus on this issue to call an expert fell on TRS.
[32] Otherwise, the court is left with the unqualified wording of the P.O. where TRS was to supply and install “all wood.”
[33] The soffits are wood, and in my view, part of the roof system.
[34] I do not accept Mr. Salo’s assertion that TRS only installs what it fabricates. For example, it does not fabricate loose lumber and yet it is responsible to install it. If the soffits were to be excluded from “all wood” that could have easily been delineated.
[35] The P.O. itself is very broad when it requires TRS
“to fully complete the following as per drawings, specifications, and addendums...”
without delineating specification sections or exclusions, and then requires from TRS the
“full package including roof system, floor system, loose lumber, all wood and related items...” (mine)
[36] TRS did not cross-examine the architect on this issue.
[37] Finally, the “not my scope” defense was never pleaded by TRS.
[38] So, in my view, the value of the soffit work must properly be included in Devlan’s cost to complete calculation.
The Roof Problem
[39] That leaves the biggest of the discrepancies between the parties for determination. I realize that this conclusion ignores any consideration of drop ceiling work. But neither the evidence on that issue, nor the argument was helpful enough for me to make any clear assessment. As far as I am concerned, the only significant differences between the two sides deal with the soffits and the roof problem. So, I have only dealt with these two issues.
[40] As with any construction project of this size, the architect conducted and produced regular field reviews for circulation to the parties so that progress could be noted and deficiencies corrected. The problem of ponding on the roof is set out in Field Review 023, dated June 15, 2010. It is contained in Exhibit D1 at Tab 47:
3.11 Roofing drainage on low roof and upper roof remains completely unacceptable. Roof drains have not been installed at low point of roof between GL1 & 9, east of GLS6. Ponding is present with no drainage. Action: Devlan to provide positive drainage as required by drawing A1.03. Devlan to consult roofing manufacture to determine how to rectify drainage problems and to ensure that manufacturer will warranty the roof.
3.12 Roof sub-structure by roof drain at GL4 & S6 appears to be damaged. Structure gives underweight. Action: Devlan to repair sub-structure around roof drain.
3.13 There is no positive drainage on low roof over Sacristy (between GLS2 & S4 by GL2) … extensive sitting water (1-2” deep) over entire length of roof. Action: Devlan to provide positive drainage to ensure no ponding on roof. Devlan to consult roofing manufacturer to determine how to rectify drainage problems and to ensure that manufacturer will warrantee the roof.
3.15 No drainage between GLW2 & W3 east of GL5 …
3.16 Extensive ponding on roof over mechanical/electrical room …
[41] There are several photos attached to this report meant to illustrate the problem.
[42] One of the photos bears a caption that “Drains have not been installed at low point of roof. Drains must be moved.”
[43] Several photos purportedly show the lack of positive drainage, though with no visible water.
[44] But I have not been shown or given drawing A1.03. It is not an exhibit.
[45] The engineer, Zurell, did not testify about the drainage problem.
[46] As might be evident from his comments above in Field Review 23, the architect Clark was not sure of the cause or the solution to the roof ponding.
[47] While he did say at one point that the slope was to be created by framing, he testified that he was not sure if the slope was to be created by framing or insulation or both and conceded that the method of achieving the proper slope might not be dealt with in the plans or specifications.
[48] Anderson testified that the roof wasn’t sloped and required “crickets” on top of the framing. He said that framing caused the drainage problem, but he was never qualified to give an expert opinion.
[49] Salo testified that the sloped insulation was not in the framers’ scope of work. It has nothing to do with framing, he testified. Sallow was never told at the time the problem was discovered that it was TRS’ to rectify and he testified he was never asked to inspect the roof drainage problem nor asked to do remedial work.
[50] Moreover, no expert at all was called with respect to the roof problem, nor indeed was any representative of the manufacturer of the roofing membrane.
[51] Salo pointed to drawing M-6 (a mechanical drawing), Exhibit 13, which shows the roof plan plumbing. It shows drains placed in the middle of the roof, not necessarily the low point.
[52] So, like Anderson, Salo rendered an unqualified opinion: that the slope is the roofer’s problem. By this Salo meant that if it is the fault of the sloped insulation, which he claimed is not part of the specification for which TRS is responsible, it must be the responsibility of the roofer.
[53] It seems to me that if the low spot on the roof was not where the drains were – and they should have been there – then surely, the roofer must take some responsibility for drawing that to Devlan’s attention or seeing to it that the slope of the insulation would compensate for the problem.
[54] It doesn’t take an expert to know that water flows downhill and the low point of the roof is the only useful placement of the drains.
[55] I am not satisfied that roof insulation was part of the TRS scope of work.
[56] So, as regards the remedial work by Alliance Roofing, necessary to correct the drainage problem so I am told, since neither side called any expert to clearly demonstrate the cause and solution to the problem (not even anyone from Alliance Roofing), I am left only with the vague assertion by the architect that the slope is to be made by the framing, the insulation or both.
[57] I am not satisfied that this is the whole answer.
[58] No one testified that the framer framed the roof incorrectly, but Devlan argues that the slope of the roof must nonetheless be wrong and that the ponding proves that.
[59] However, I would conclude that the framers most likely are not responsible for the sloped insulation, and that water finds its own level.
[60] I am not satisfied that the drains were properly placed by whoever was required to place them and certainly that was not TRS.
[61] So the only fair and equitable solution here is to divide the cost to repair the roof between the parties.
[62] I am satisfied that the amount shown in Devlan’s schedule for correcting the roof slope ($49,070.) is the amount that should be split. Thus, using the Devlan schedule, the final tally would be shown as:
(i) Cost of completion $192,462
(ii) Less Amount Owing to TRS on contract - $ 98,495
(iii) Less correcting roof slop - $ 49,070 ÷ 2 = $ 24,535
(iv) Total due to Devlan $ 69,432
[63] Accordingly, there shall be judgment to the Defendant Devlan in the amount of $69,432, plus pre-judgment and post-judgment interest.
Costs
[64] I shall fix costs after reviewing the parties’ submissions, which shall be made as follows:
(a) on or before September 5, 2014, the Defendant, Devlan, shall serve and deliver to me at my Kitchener chambers:
(i) its Costs Outline not augmented by more than two double spaced pages;
(ii) its Bill of Costs; and
(iii) any relevant Offer(s) to Settle and
(b) on or before September 26, 2014, the TRS shall and deliver to me at my Kitchener chambers:
(i) its Costs Outline not augmented by more than two double spaced pages; and
(ii) any relevant Offer(s) to Settle.
P.J. Flynn, J.
Released: July 30, 2014
COURT FILE NO.: C-976-10
DATE: 2014-07-30
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
TRS Components Ltd.
Plaintiff
and –
Devlan Construction Ltd., The Trustess of Knox Presbyterian Church, Waterloo, Pace Savings & Credit Union Limited and Education Credit Union Limited
Defendants
REASONS FOR JUDGMENT
P.J. Flynn, J.
Released: July 30, 2014