Wilson v. Pickett, 2015 ONSC 3409
CITATION: Wilson v. Pickett, 2015 ONSC 3409
COURT FILE NO.: 0106/13
DATE: 2015-05-27
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Lynn Louise Wilson & Larry Lawson Wilson
Plaintiffs
– and –
Elena Pickett& Diana Musso Jendrasch
Defendants
Self-represented
Dennis Van Sickle, for the Defendant Elena Pickett
Diana Musso Jendrasch, self-represented
HEARD: May 20, 21, 22, 25, 26 / 2015
Justice B. glass
Background
[1] The Plaintiffs have sued for a debt flowing from a cottage renovation project. There has been partial payment.
[2] The two Defendants are sisters who were the beneficiaries of their father’s will. The cottage was part of the estate.
[3] There is a battle by way of crossclaim between the two sisters as well. Elena Pickett maintains that she has a claim over against Diana Musso Jendrasch for any judgment she is found to owe from this action. Elena maintains that she only agreed to part of the work and that Diana went beyond that understanding thereby incurring additional indebtedness. Elena Pickett also crossclaims for $10,000 against Diana Musso Jendrasch for removing funds from the estate improperly. The $10,000 crossclaim is not to be dealt with at this trial, but rather will be syphoned off as a Small Claims Court action in Lindsay following this trial.
[4] There is no written agreement. The work was undertaken pursuant to an informal oral agreement with the Wilsons. The primary contact person for the Defendants was Diana Musso Jendrasch.
[5] The Wilsons claim interest on an outstanding account of about $33,000 to the tune of $64,000. The Plaintiffs claim general damages for pain and suffering and loss of income they could have earned with the money they put into the project for which they have not been paid in full.
[6] The Defendants submit that the invoices are not substantiated and that some of the work was for electrical and plumbing work that should have been done by licenced persons in those trades. Mr. Wilson was not and licensed as an electrician and a plumber.
[7] The Plaintiffs commenced the work for what they thought was a job of up to $50,000 and then discovered many flaws in the building thereby resulting in them saying that they were prepared to do the renovation work for up to $150,000.
[8] During examinations for discovery both Wilsons said the cost of the project was for time and materials; however, at trial they state that this was a flat price agreement.
[9] No regular provision of invoices was given to the Defendants.
[10] A lump sum bill was presented in December 2012.
[11] There was no agreement for payment of interest on an outstanding account.
[12] The Defendants were to pay down $20,000 at the commencement, but they failed to do so. They paid $5,000 and later another $5,500.
[13] In due course, the Defendants paid over $82,000 so that a total of $92,500 approximately have been paid.
Issues To Be Determined
[14] Did the parties use a flat price contract or one to be paid for labour and materials?
[15] If this was a labour and materials project, was there a maximum cost projected or was the end price open-ended?
[16] Should there be an allowance for interest on the outstanding account for work done by the Plaintiffs?
[17] Was the quality of work up to reasonable standards or were there deficiencies for which the Defendants should be compensated?
[18] If the project was to be compensated on the basis of labour and materials and if the account is determined to be excessive, is there any balance owing beyond the $92,500 that has been paid?
[19] If the Plaintiffs have been overpaid and if the Defendants are entitled to an allowance for deficiencies because they have had to remedy defective work, how much of a set-off should the Defendants be paid by the Plaintiffs?
Type of Agreement
[20] I am satisfied that this was not a flat price contract but rather a time and materials agreement that has not been substantiated by the Plaintiffs. The invoice shown at Exhibit 6 appears to be a unilateral assignment of dollar figures for aspects of the work done without proper accounting of hours of work. Mr. Wilson is not a licensed electrician or plumber so that he should not have done the work for those services. He appears to have passed himself off as qualified to do so. In effect, compensation to the Plaintiffs for time and materials will be determined on a quantum meruit basis.
[21] The bottom line is that there was general discussion about the type of work to be completed with a consideration of a top cost of $25,000. Then, it appears that the two sisters considered spending up to $50,000 maximum. The Plaintiffs claim that the upper range grew to $150,000 as they encountered much more extensive structural work to be done. None of the figures was put to writing. No letter was sent by the Plaintiffs to the two Defendants. No interim report or invoicing were sent to Ms. Pickett and Ms. Jendrasch. The customers got one invoice in December 2012 after about 6 months of work. The two Defendants dispute discussing a project of $150,000.
[22] The number of hours of work is not substantiated so that the Plaintiffs could not say how many hours when they testified. One is left with the impression that the Plaintiffs simply worked without keeping records and then just assigned block fee descriptions unsubstantiated.
[23] The parties commenced discussing a renovation project that might amount to $50,000 for the roof, the dock and the bathroom. When structural problems were reported by the Plaintiffs, the Defendants decided not to do any dock work but rather the roof, and bathroom.
[24] There is some dispute about any work beyond this. Elena Pickett claims that her sister, Diana Musso Jendrasch, did not have her authority to engage any greater amount of work so that if she is found to be liable for money owing, she should be compensated by Diana Musso Jendrasch.
Expert Opinion Evidence
[25] Mr. David Law was qualified to provide expert opinion evidence in the cottage and home renovation field. He has worked in the industry since he was 24years of age and has operated his own business since 1988. He has completed hundreds of renovation projects during his career. In his review of the cottage involved in this litigation, he opined that the Plaintiffs over-charged for the work they did. He advised that the claim for materials was reasonable; however, the labour claim was excessive. A common labour/material ratio in the industry is a dollar figure two times the dollar figure for materials. If that were so here, the labour account would have been about $48,000 since the materials totalled $23,793.11. The problem is that the labour account submitted by the Plaintiffs is $88,150. Mr. Law advised that sometimes the ratio of labour to materials is 3 to 1 but that is exceptional and this is not an exceptional case.
[26] Mr. Law noted that the account for labour for the electrical and plumbing work should be removed because Mr. Wilson is not a licensed person in either trade. That would remove $4580 for electrical work and $3650 for plumbing work. The charge of $2600 for removal of rodent feces should have been part of the general job of getting rid of old materials.
[27] At the end of the day, Mr. Law thought that the Plaintiffs had over-charged labour by $60,000.
[28] Mr. John Hill was called for expert evidence as a licensed electrician. He testified that the electrical work claimed on the Plaintiffs’ account should have been done by a licensed electrician and further that the Plaintiffs had not done all they claimed to have done. Further, the electrical work was not done properly. The electrical account was $4580.
[29] Mr. Richard Karelsen testified as an expert licensed plumber. The plumbing work on the Wilsons’ account should have been done by a licensed plumber. The work was not done properly. That account had been $3650.
[30] Photos were included in the reports for each of Mr. Law, Mr Hill and Mr. Karelsen. One can see easily that the work was lacking the expertise that each witness had mentioned.
[31] At the examinations for discoveries of the Wilsons, they stated that this was a time and materials contract; however, they testified at trial that it was a flat price contract.
[32] Mr. Law called it a labour and materials job. I am satisfied that the Wilsons changed their description of the type of job it was from what they said at the examinations for discovery. They tried to make a lump sum out of headings of work. What they did was not worth what they claim. The Plaintiffs have attempted to make their work into a fine job when in fact it is not.
[33] I find that this arrangement was not open to advance up to $150,000. There is nothing to demonstrate a foundation for such a claim.
[34] The account for the work of a licensed electrician and plumber is not to be allowed because Mr. Wilson is not a legally licensed person in these trades.
Claim for Support Workers
[35] The Plaintiffs claim for labour work done by several persons other than Mr. Wilson. One such person, Cody Carr, testified that he worked at the cottage with Larry Wilson through the week and stayed there at least a month. He had signed an affidavit saying he worked there for several months. He could not say how much he was paid. The Plaintiffs could not say how much they paid Mr. Carr or any other person working on the site. There is no information to substantiate the labour bill for the alleged people working at the site.
Claim for Interest on the Outstanding Account
[36] The Plaintiffs make a claim for interest of more than $64,000. There was no agreement about interest. Claiming interest in this amount on $32,000 being the balance of the account is very extreme. At the most, they might be entitled to interest within the allowances found in the Courts of Justice Act should the court exercise discretion to award any interest.
What About Deficiencies That Required Corrections?
[37] The Defendants are entitled to set off those from any money they might owe if they are found to owe any money. The Defendants would have the electrical and plumbing work to be redone along with replacement of drywall. Mr. Ball noted the drywall would cost $700 plus HST. The sum of $4580 for electrical and $3650 will be allowed as an expense to be incurred for completing the work by a certified electrician and plumber. The HST on the $700 drywall will be $91.00.
What Was the Job Worth?
[38] When the quantum meruit allowance for work done by the Plaintiffs is calculated as described above, there would be $48,000 for labour and $23,793.11 for materials for a total of $71,793.11. They have been paid $92,500. That appears to mean that the Plaintiffs have been paid even more than they might be entitled to receive.
[39] The Defendants are content that they not be responsible for any sum beyond the $92,500 that they have paid. If one takes the accounting I have listed above, one might conclude that the Plaintiffs owe money to the Defendants. That would be aside from any consideration for interest.
[40] I am satisfied that nothing further should be found to be owing to the Plaintiffs. In effect, they have been overpaid. This does not allow any award for interest for the Plaintiffs’ claim. I note that the oral agreement did not provide for interest. There might be consideration for interest within the provisions of the Courts of Justice Act; however, I am not persuaded to exercise discretion to award any interest in favour of the Plaintiffs because I find that they have conducted themselves improperly by claiming for work that was done illegally and in a substandard way. That work is that of an electrician and a plumber.
[41] The Plaintiffs have claimed for general damages for pain and suffering in a contract case. There is no foundation for such a claim.
[42] The Plaintiffs have claimed that they have lost money because they have bankrolled this project. In light of my determination that there will not be any interest awarded, a claim regarding funding the project is dismissed.
Conclusion
[43] This project was a labour and materials job to be paid on a quantum meruit basis.
[44] There was no maximum possible sum such as $150,000 because I find there was no agreement to that effect.
[45] No interest should be allowed for the Plaintiffs’ account submitted in December 2012. They lumped interest into the account without ever having discussed submitting monthly accounts which would attract interest after 30 days.
[46] The quality of the work was below what would be expected.
[47] The Plaintiffs have been overpaid so that they are not entitled to any additional money for this project.
[48] The Plaintiffs’ action is dismissed in light of this decision. The compensation allowed in this trial is for work on a quantum meruit basis. Illegal work would be deducted as well. I would not award any interest to the Plaintiffs if there were funds found to be owing to them.
[49] The outstanding crossclaim between the Defendants is to be left for a trial in Small Claims Court if the Defendants do not resolve the matter.
Justice B. Glass
Released: May 27, 2015
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ONTARIO
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