ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 15-63105
DATE: 20150825
BETWEEN:
TOFCON CONSTRUCTION INC.
Plaintiff/Responding Party
– and –
ATTORNEY GENERAL OF CANADA
Defendant/Moving Party
Ronald W. Price, for the Plaintiff/Moving Party
Sarah Jane Harvey, Department of Justice, for the Defendant/Moving Party
HEARD: August 20, 2015 at Ottawa, ON
REASONS ON MOTION
Madam Justice B. R. Warkentin
[1] The Defendant, the Attorney General of Canada (“Canada”) brought this motion seeking an order striking the Plaintiff’s claim without leave to amend pursuant to rules 21.01(1)(a) and (b) and 25.11(c) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 alleging it discloses no reasonable cause of action and is an abuse of process.
[2] In the alternative, the Defendant seeks further and better particulars pursuant to Rule 25 of the Rules of Civil Procedure.
[3] The Plaintiff, TOFCON Construction Inc. (“TOFCON”) entered into a contract with Canada dated August 23, 2011 for the supply of services and materials for exterior wall stabilization of the building at 180 Wellington Street, Ottawa.
[4] The work was to be completed by October 14, 2012 and was to be sequenced in accordance with the wall elevation from the top down, starting with the West and continuing in the South, North and East in accordance with certain milestone dates as follows:
Elevation Completion
West 15-Jan-2012
South 30-Mar-2012
North 15-Aug-2012
East 28-Sep-2012
[5] TOFCON was unable to complete its work by October 14, 2012 and has alleged that its work was delayed as a result of a number of problems it attributes to the Defendant. TOFCON ceased working on the project on November 20, 2013.
[6] TOFCON notified Canada that it had incurred significant losses as a result of actions of the Defendant and retained a claims consultant to review the project history and to prepare a report. The report was delivered to Canada in the summer of 2014 in anticipation that this would assist the parties with reaching a resolution.
[7] A Statement of Claim was issued on January 16, 2015 and served on the Defendant on January 27, 2015 alleging breach of contract and negligence. In late February, counsel for the Defendant sought permission of counsel for the Plaintiff to have an additional month, until March 31, 2015, to prepare and serve its Statement of Defence. Counsel for the Plaintiff consented to this additional time.
[8] On March 30, 2015, counsel for the Defendant served a Demand for Particulars on the Plaintiff, alleging that they were unable to respond to the Statement of Claim because of a lack of particulars.
[9] Counsel for the Plaintiff denied that further particulars were required, pointing to a Claims Report that had been commissioned by the Plaintiff and provided to the Defendant in the summer of 2014 that was incorporated by reference into the Statement of Claim. The report, while extensive, included a summary of the history of the project, the nature of the work completed or attempted by the Plaintiff and a summary of the delays and challenges that resulted in TOFCON having to withdraw from the project.
[10] Counsel for the Defendant acknowledged that Canada had received the report and that the report had been reviewed by its experts. She also confirmed that Canada had, throughout the course of this project, its own project manager, Mr. John Stewart of MHPM Project Managers Inc. involved in the project. She confirmed that Mr. Stewart had reviewed the claims report of the Plaintiff.
[11] Counsel for the Defendant also acknowledged that TOFCON had, on a monthly basis throughout its involvement in the project, sent revised construction schedules with detailed summaries of the delays that were occurring to all of those involved in overseeing the project for Canada.
[12] Counsel for the Defendant submitted that the difficulty for Canada in preparing its Statement of Defence was attempting to ascertain which of the other contractors and subcontractors involved in different aspects of this project might be responsible for the delays and related problems. She claimed that the Defendant required specific and detailed information from the Plaintiff about who was responsible for the issues that resulted in the Plaintiff pulling out of the project in order to ensure those companies or individuals could properly be added as third parties.
[13] In addition, the Defence demanded specifics of each of the delays or problems encountered by the Plaintiff throughout the course of the project.
[14] It was the position of the Defendant that without this information, the Plaintiff’s pleadings were insufficient; thus preventing the Defendant from being able to prepare its’ Statement of Defence.
[15] On April 1, 2015, the Defendant served a Demand for Further and Better Particulars on the Plaintiff and advised the Plaintiff that failure to provide the sought after particulars would result in Canada bringing a motion to strike the Statement of Claim and a motion for particulars. The Plaintiff provided its Response to the Demand for Particulars on April 8, 2015, however, it did not satisfy the Defendant and this motion was commenced. A Notice of Motion without supporting documentation was served on the Plaintiff on April 21, 2015. An Amended Notice of Motion with the Motion Record was served on the Plaintiff on July 24, 2015.
[16] Part of the Defendant’s motion sought to strike those parts of the Statement of Claim that alleged negligence due to the wording of the contract between the parties that permitted claims only arising from breaches of contract. Until this issue was raised in the Notice of Motion and set out in detail in the Defendant’s Factum, this issue had not arisen in correspondence or other communication between counsel.
[17] Once this issue was drawn to counsel for the Plaintiff’s attention, he informed Counsel for the Defendant that he would be amending his pleadings accordingly. Counsel for the Defendant, in arguing this motion, suggested that the Statement of Claim should never have been drafted in this manner because Plaintiff’s counsel was well aware of the prohibition of pleading the tort of negligence due to his prior involvement in other litigation where the Court established this prohibition.
Analysis
Striking the Statement of Claim, without leave to amend
[18] Canada has alleged the Statement of Claim is so deficient that it discloses no reasonable cause of action and is an abuse of process. Canada seeks to have the Statement of Claim struck without leave to amend.
[19] In order to succeed on this aspect of its motion, Canada must demonstrate that it is plain and obvious that the allegations pled are incapable of supporting a cause of action and the claim cannot succeed; or that the Claim discloses no reasonable cause of action pursuant to rule 21.01(a) and (b) of the Rules of Civil Procedure.
[20] Counsel for the Defendant also argued that the Statement of Claim should be struck under rule 25.11(c) of the Rules as being frivolous, vexatious, or otherwise an abuse of process of the Court.
[21] While the motion materials and the submissions of counsel for the Defendant indicated that it was seeking the entire Statement of Claim to be struck without leave to amend on the basis of the Rules set out above, there was no evidence provided to the Court for this argument, except for the claims that were pled in the tort of negligence rather than breach of contract.
[22] Because the Plaintiff readily agreed to amend its pleadings to conform to this demand, counsel for the Defendant acknowledged that the Plaintiff was entitled to amend its pleadings at this early stage in the process.
[23] The Statement of Claim clearly demonstrates that there is a cause of action against the Defendant. Nothing in the claim is frivolous or vexatious or an abuse of the process of the Court.
[24] The Defendant’s motion to strike the Statement of Claim without leave to amend is therefore dismissed.
[25] Those portions of the Statement of Claim that relate to claims in negligence are struck and the Plaintiff shall have until August 28, 2015 to serve and file an amended Statement of Claim.
Particulars
[26] Canada alleges that the Plaintiff has failed to plead sufficient material facts to support its claims.
[27] Rule 25.06 provides that a pleading shall contain “a concise statement of material facts on which the party relies for the claim or defence, but not the evidence by which those facts are to be proved.”
[28] By incorporating by reference the report of the claims consultant in its pleadings, counsel for the Defendant argued that the Plaintiff has improperly pled evidence, without providing the material facts upon which the Plaintiff relies.
[29] Counsel for the Defendant also submitted that to successfully claim breach of contract generally, the Plaintiff must show:
a) a valid contract exists;
b) the existence of a promise in the contract;
c) non-performance of the promise; and,
d) absence of any excuse for failure to perform the promise.[^1]
[30] Similarly, counsel for the Defendant submitted that to successfully claim breach of contract for delay, the Plaintiff must demonstrate an express or implied term of the contract was broken by delay, and that the contractor complied with all notice and default claims.[^2]
[31] It was therefore Canada’s position that the pleadings in the Statement of Claim were inadequate and required significantly enhanced statements of material facts pertaining to the allegations of delay, including who was responsible for the delays and when these events occurred. Canada also sought particulars with respect to the claims for unjust enrichment and quantum meruit.
[32] Counsel for the Plaintiff argued that there were sufficient particulars in the Statement of Claim to permit the Defendant to respond. He submitted that the Defendant had failed to demonstrate that the particulars sought were not within its knowledge and that the particulars were required in order to allow it to plead.
[33] It was also the position of the Plaintiff that the demand for particulars served on the Plaintiff was an attempt to conduct written interrogatories and that the information sought by the Defendant as particulars, is in fact evidence that would be improper to include in pleadings.
[34] Counsel for the Plaintiff agreed with counsel for the Defendant on the issues that the Plaintiff would have to prove in order to succeed at trial, however disagreed that it was necessary to plead to these elements with particularity.
Analysis
[35] Particulars for pleadings will only be ordered if:
a) they are not within the knowledge of the parties demanding them; and
b) they are necessary to enable the party to plead.[^3]
[36] I agree with counsel for the Plaintiff on the points raised in responding to the motion and as set out in their factum. A party may make reference to an expert report in its pleadings to provide some background with respect to their claims. It would be inappropriate to attempt to append the report, or to quote at length from the report in one’s pleadings because that would tread into the area of pleading evidence rather than a concise statement of facts.
[37] While it may be difficult for the Defendant to ascertain who was responsible for the delays and other breaches of contract that resulted in the claims of the Plaintiff, this information is clearly within their knowledge. It was the Defendant who at all times controlled the awarding of contracts for this project; who retained the services of a project manager to oversee the project and who received and reviewed the monthly reports not only from the Plaintiff but presumably from the other contractors involved in the different aspects of this project.
[38] It is in fact the Defendant who has the knowledge of all aspects of this project; particularly which of the contractors and subcontractors were not completing their aspects of the project according to their contractual terms. The Plaintiff is not in possession of copies of contracts awarded to others nor does the Plaintiff have access to the correspondence and communication between the project manager, the other contractors or the Defendant.
[39] I therefore find that the particulars sought are within the knowledge of the Defendant. The Defendant did not provide an affidavit or other evidence on this motion to suggest otherwise.
[40] I also find that the two demands for particulars served on the Plaintiff were, as the Plaintiff has alleged, set out as written interrogatories. The information sought in those demands is more properly the subject of the Discovery Process and not required for the Defendant to prepare its Statement of Defence.
[41] The Defendant’s motion for particulars is therefore dismissed.
Litigation Timetable
[42] At the conclusion of argument on this motion, the parties consented to the following litigation timetable:
a) The Amended Statement of Claim shall be served and filed on or before August 28, 2015;
b) The Statement of Defence shall be served and filed within 30 days of counsel for the Defendant receiving the Amended Statement of Claim;
c) Production of documents shall be exchanged and completed by December 15, 2015;
d) Examinations for Discovery shall be held by mid-March, 2016; and
e) This matter shall be referred to the Case Management Master for ongoing Case Management.
Costs
[43] On consent of the parties, costs are ordered in the cause.
Madam Justice B.R. Warkentin
Released: August 25, 2015
COURT FILE NO.: 15-63105
DATE: 20150825
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
TOFCON CONSTRUCTION INC.
Plaintiff/Responding Party
-and-
ATTORNEY GENERAL OF CANADA
Defendant/Moving Party
REASONS on motion
Warkentin J.
Released: August 25, 2015
[^1]: Karen Horsman & Gareth Morley (eds). “Government Liability Law and Practice”, Ch. 2 “Crown Liability in Contract”, (2008) Canada Law Book, Aura., at p. 2-31, BOA, Tab 24.
[^2]: “Heintzman and Goldsmith on Canadian Building Contracts,” 5th Ed (2015), Vol. 1 Carswell: Toronto, at 7-19 to 7-25, BOA, Tab 25.
[^3]: Kirvan v. Whitfield, 2005 CarswellOnt 2581 (Ont. S.C.J.), para. 9