ONTARIO
SUPERIOR COURT OF JUSTICE
CITATION: Milic v. Pop’s Restoration Ltd., 2015 ONSC 1129
COURT FILE NO.: CV-13-480872
DATE: February 19, 2015
BETWEEN:
Sinisa Milic
M. Wiffin, for the plaintiff
Fax: 647-317-1515
plaintiff
- and -
Pop’s Restoration Ltd. And St. David’s Village Corporation
S. Tripodi, for the defendant Pop’s
Fax: 416-924-61612
defendants
HEARD: February 19, 2015
Master C. Albert
[1] Sinisa Milic claims $16,400.00 for drywall and taping services and materials supplied as a subcontractor to Pop’s Restoration Ltd. (“Pop’s”) in connection with window replacement carried out by Pop’s for St. David’s Village Corporation, the owner of a seven storey seniors’ residence. Mr. Milic registered a construction lien for that amount on April 3, 2013 as instrument AT3269656.
[2] Pop’s defends the claim on the basis that Mr. Milic’s work was deficient and incomplete because he had to be terminated when residents complained about him.
[3] Once security was posted[^1] in the form of a lien bond[^2] the lien was vacated and Mr. Milic discontinued the action against St. David’s[^3].
[4] Considering the amount in issue the trial proceeded as a summary trial without examinations for discovery but with affidavit evidence in chief delivered in advance of trial or, where a witness was unco-operative, a statement of anticipated evidence together with a summons to witness. The detailed pretrial directions are in my order of April 28, 2014.
[5] The issues are:
a) What were the terms of the contract as to price and scope of work?
b) Was Pop’s entitled to terminate the contract prior to completion and not pay the balance owing because of deficiencies and complaints from residents?
[6] A procedural issue arose during the trial. After having cross-examined the plaintiff’s witnesses and having his own witness cross-examined, and in the absence of having delivered affidavit evidence in chief or statements of anticipated evidence of any other witnesses, the defendant asked for leave to call four additional witnesses. I refused leave to do so for the reasons delivered orally at trial.
I. Analysis
a. The contract price and scope of work
[7] The parties entered into a verbal contract for Mr. Milic to supply taping and related services and materials for the price of $3,300.00 per floor including materials broken down as $3,000.00 for labour plus $300.00 for materials. Mr. Popovic, president of Pop’s, does not deny the contract or the price. The issue is scope of work.
[8] Mr. Popovic asked Mr. Milic to carry out additional work in the nature of patching and they agreed to a fixed price. Mr. Milic states that the agreed upon price was $3,300.00 for the additional work and Mr. Popovic states that the agreed upon price was $3,000.00 including materials. I prefer the evidence of Mr. Milic on the issue of quantum, namely the $300.00 difference. Taking into account surrounding circumstances, the format of specifying $3,000.00 plus $300.00 for materials is consistent with the pricing and invoicing of the main contract work. Also, Mr. Popovic did not contest the quantum of the additional $300.00 upon receipt of the February 25, 2013 invoice. I find that the price agreed to for the additional work was $3,300.00 including materials.
[9] On the issue of scope of work Mr. Milic states that the agreement was for him to tape the two sides of the new windows. Mr. Popovic asserts that the contract was to tape the two sides plus the bottom of the windows.
[10] The design of the windows that Pop’s was replacing is such that they had two sides and a window sill below but no drywall above. The issue is whether Pop’s contracted with Mr. Milic to tape below the windows where the window sill was to be installed or whether the contract was to provide taping only on the two sides of each window where drywall was to be installed by Pop’s workers.
[11] Mr. Milic attended at the site prior to quoting on the job. He met with an employee of Pop’s and examined a finished sample of a completed window, complete with drywall, taping, a sill and paint. Mr. Popovic was not present at the inspection of the finished sample of the window. Mr. Milic discussed the job with the employee and then he spoke by telephone with Mr. Popovic to provide a quote, which Mr. Popovic said he accepted without haggling.
[12] I find that the contract was for Mr. Milic to supply drywall to the two sides of the windows and not to the bottom for two reasons. First, I find that the evidence of Mr. Milic is more reliable than that of Mr. Popovic. While he became confused and excited at times, his evidence was thorough, consistent and supported by documents. Mr. Popovic, on the other hand, made allegations that were uncorroborated and implausible. For example, if the original contract had included under the windows then he would not have agreed to the additional work under the windows for an additional price. Second, on the issue of complaints discussed in detail below, his evidence is unsupported and appears retaliatory to Mr. Milic refusing to renegotiate the contractual payment terms.
[13] I find that the scope of work in the contract was for Mr. Milic to tape the sides of the windows but not the bottom. The scope of work in the extra was for patching as requested under the windows for the additional fixed price of $3,300.00 including materials.
[14] As for timing of payment, Mr. Popovic asserts that he had 30 days to pay but there is no evidence of such an agreement. The only evidence of the time within which Pop’s generally paid its workers is gleaned from the time sheets and cheque stubs attached to Mr. Popovic’s affidaivit, as well as his oral evidence wherein he testified that he pays his workers one week after time sheets are submitted. While Mr. Milic was not a “time sheet” employee but rather a contractor with a fixed price contract, the evidence nevertheless suggests that Pop’s practice is generally to pay promptly upon receiving the payment trigger. In the case of a worker that would be a time sheet. In the case of a fixed price contract worker that would be an invoice.
[15] Mr. Milic delivered three invoices. The first invoice, dated January 21, 2013, was for the completion of 3 full floors and two half floors for a total of $13,200.00. Pop’s paid $5,000.00 of this invoice on February 1, 2013 leaving a balance owing of $8,200.00. The second invoice, dated February 6, 2013, was for the completion of two full floors and two half floors, for a total of $9,900.00. Pop’s paid $5,000.00 on February 12, 2013 but the reference to the cheque stub is to the balance owing on the first invoice. The account was outstanding by $13,400.00.
[16] On February 25, 2013 Mr. Milic issued his third invoice for the extra work in the amount of $3,300.00. No further payments were made.
[17] The evidence of timing of payment is relevant to the issue of credibility. In his evidence Mr. Popovic suggests that he had 30 days to pay. There is no such contract and his pattern regarding his workers is to pay in one week. Regardless, more than 30 days has passed. All that is accomplished with Mr. Popovic’s evidence asserting that he had 30 days to pay is to discredit the reliability of his evidence in general.
b. Deficiencies and Complaints about Mr. Milic’s work
[18] Pop’s asserts that Mr. Milic’s work was deficient. The onus is on the person claiming deficiencies to prove that there were deficiencies, that the contractor was given an opportunity to repair the deficiencies and the value in damages for the deficiencies. Pop’s has not met the onus of proof. There is no evidence of complaints made by Mr. Popovic to Mr. Milic during the project as to the quality of Mr. Milic’s work.
[19] Pop’s relies on complaints from residents of the senior’s home to justify ejecting Mr. Milic from the worksite with one day left to complete touchups. Mr. Popovic also relies on resident’s complaints to justify Pop’s failure to pay the balance owing for the materials and services supplied.
[20] Mr. Popovic did not have any evidence to support his allegations of deficiencies and complaints from residents. In his affidavit evidence in chief Mr. Popovic deposes that on or about a date at the end of February, 2013 he received a call from the “consultant” about complaints from residents. He did not name the consultant in his affidavit. Nor did he provide affidavit evidence in chief of the consultant or summons the consultant as a witness at trial and serve a statement of anticipated evidence as required by my order of April 28, 2014.
[21] When asked in cross-examination to provide further information about the alleged complaints Mr. Popovich was unable to provide any details. He did not know who had made complaints, the nature of the complaints, the date of the complaints, or how many complaints were made. He admitted that he did not follow up and investigate the complaints.
[22] The timing of the alleged complaints is significant. Mr. Popovic first raised the issue of complaints after receiving Mr. Milic’s third invoice and after Mr. Milic had refused to renegotiate the contractual payment terms.
[23] There is no evidence of probative value of deficiencies, any opportunity for Mr. Milic to rectify deficiencies or the cost to rectify deficiencies. The only evidence of costs is a series of time sheets of Pop’s workers that overlap Mr. Milic’s first week of work and fail to specify what was done. Certainly payments to other workers on site during Mr. Milic’s first couple of weeks of work could not have been to rectify any of Mr. Milic’s work.
[24] I find Pop’s claim for set-off for deficiencies and completion costs must fail as it is unsupported by the evidence and unproven.
c. Calculation
[25] Mr. Milic invoiced a total of $26, 400.00 as follows:
January 21, 2013: $13,200.00
February 6, 2013: 9,900.00
February 25, 2013: 3,300.00
Total: $26,400.00
[26] Pop’s paid a total of $10,000.00 by cheques, leaving a balance owing of $16,400.00.
II. Conclusion
[27] I find that Mr. Milic is entitled to recover $16,400.00 from Pop’s. Mr. Milic was entitled to a construction lien for this amount. Security in the form of a lien bond was posted to account 526862 to vacate the construction lien. If the parties are able to resolve payment in accordance with these reasons then the bond can be returned to the party posting the bond, failing which the court will issue a report that the bond be called upon to satisfy the judgment in favour of Mr. Milic.
[28] Accordingly, THIS COURT ORDERS:
a) Sinisa Milic is entitled to a construction lien in the amount of $16,400.00 and payment of this amount plus prejudgment interest of $391.94[^4] calculated at the rate of 1.3% from April 3, 2013 to February 19, 2015 and the post judgment interest rate of 3% from February 20, 2015 until payment.
b) If the parties are unable to resolve how the judgment is to be satisfied and obtain a final order by February 25, 2015 they shall attend before me on that date at 10:00am to settle the final report. Counsel for Mr. Milic shall prepare, serve and file a draft report in the form, prescribed by the Construction Lien Act, R.S.O. 1990, c.C.30 by February 23, 2015.
III. Costs
[29] It is appropriate for costs to follow the event. Mr. Milic was entirely successful in his claim. The plaintiff exceeded its offer of April 11, 2014 at trial and is entitled to substantial indemnity costs from that date. The defendant did not make a counteroffer.
[30] The costs outline filed on behalf of the plaintiff is very reasonable. Counsel’s rates are proportionate to a case of this type and the hours claimed are reasonable. This is one of those cases where the parties ought to have been able to settle had the defendant acted reasonably. However, the plaintiff was given no choice but to go to trial. Mr. Milic did everything that he was required to do to collect payment for his hard work including an attempt to resolve the claim early on before running up the inevitable costs of preparing for trial. He should not be punished for doing so.
[31] Having heard the submissions of counsel, taking into account the factors prescribed by the rules and sections 67 and 86 of the Act, including the amount in issue, indemnity, degree of success, proportionality, complexity, importance of the issues to the parties, what ought to have been the reasonable expectation of the parties and the conduct of the parties I find that a reasonable and appropriate award of costs of the action in the circumstances is $8,900.00 payable by Pop’s to Mr. Milic.
[32] Accordingly THIS COURT ORDERS that Pop’s Restoration Ltd. pay to Sinisa Milic the costs fixed at $8,900.00 including HST and disbursements.
Master C. Albert .
Released: February 19, 2015
CITATION: Milic v. Pop’s Restoration Ltd., 2015 ONSC 1129
COURT FILE NO.: CV-13-480872
DATE: February 19, 2015
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Sinisa Milic
Plaintiff
- and -
Pop’s Restoration Ltd. And St. David’s Village Corporation
Defendant
REASONS FOR JUDGMENT
Master C. Albert
Released: February 19, 2015
[^1]: Account 526862
[^2]: Order of Master Wiebe dated May 31, 2013
[^3]: Notice of Discontinuance filed September 13, 2013
[^4]: [($16,400.00 x 1.3%) / 365] x 607