ONSC 2201
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Weinmann Electric Ltd.
Plaintiff
– and –
The Regional Municipality of Niagara
Defendant
Kenneth W. Movat, for the Plaintiff
Paul DeMelo, for the Defendant
HEARD: November 10 and 12, 2014, October 29 and 30, 2015
THE HONOURABLE MR. JUSTICE R. J. NIGHTINGALE
1The Plaintiff (“Weinmann”) brings this action against the Defendant (“the Region”) claiming damages for intentional interference with the Plaintiff’s economic relations and damages for acting in bad faith.
Danny Toppazini
[2]
Danny Toppazini
Danny Toppazini is the majority shareholder of Weinmann, an electrical contracting company. That company for a number of years has provided its services for municipalities throughout Ontario, the provincial government and private developers for their road lighting needs.
3In 2010, Weinmann was asked to provide a tender quote on a subcontract with the general contractor Rankin Construction for the Region’s road lighting needs on a construction project on Highway 20 in the Region.
4Mr. Toppazini received and reviewed the Region’s tender documents for this job including all of the Region’s specifications which required the supply and installation of 47 streetlight poles on a per unit cost basis. He then submitted Weinmann’s quote which was accepted by Rankin.
5Mr. Toppazini admitted that when he reviewed the tender documents and submitted his quote to Rankin, Weinmann agreed to supply poles manufactured by a company called Pole-Fab as he knew they were the only supplier approved by the Region for the 47 poles required under the tender. He knew that these Pole-Fab poles met the specifications in the Region’s tender documents and that no other pole manufacturer was on the Region’s approved list of suppliers. He admitted he also knew that the tender conditions required that all materials supplied by Weinmann through the general contractor Rankin had to be approved by the Region before they were used on-site. There was no confusion as to which poles were intended or required by the tender and no clarification was ever sought on that issue by him or Weinmann.
6Accordingly, Weinmann specifically confirmed in its tender document that Pole-Fab poles were being supplied by it as expected by the Region and Rankin. Once its tender was accepted, Weinmann in fact proceeded with its order of the Pole-Fab poles from that company on June 8, 2010 indicating that it would advise Pole-Fab when it wanted them ready for the job.
7Mr. Toppazini admitted there was no contract between Weinmann and the Region and that all of the specifications in the tender documents had to be met otherwise its tender would not comply with the tender requirements.
8In late September or early October 2010, Mr. Toppazini said “someone” from his company apparently contacted “someone” from Pole-Fab regarding the poles and was allegedly told that the poles he had ordered for this job were not available and had been sold to another contractor. His evidence was that this “someone” from his company was given a delivery date of 8 to 12 weeks for new poles which was beyond the time requirement for Weinmann to install the poles pursuant to its contract with Rankin as required under the Region’s contract.
9His evidence was that because of that, he approached another pole manufacturer AMG Metals (“AMG”) which told him that it had just started manufacturing lighting poles for municipalities, that its poles met provincial standards and had been installed in other municipalities and were available. Mr. Toppazini stated that he immediately ordered them and installed them on site on December 18, 2010 without even telling Rankin or the Region that he was planning to do so.
10He admitted at trial, as he had in his letter of February 2, 2011 to the Region, that Weinmann didn’t comply with the terms of the Region’s tender document that required Weinmann to provide drawings to and obtain pre-approval for these substituted poles from the Region before ordering them and installing them. Moreover, Mr. Toppazini had not even seen them either until after Weinmann installed them.
11Rather, Mr. Toppazini stated he didn’t have time to get the drawings and the Region’s approval for these substituted poles until after Weinmann installed them. Weinmann did not provide the drawings for these substituted poles to the Region until four days later on December 22, 2010.
12What is significant is Mr. Toppazini’s evidence that he had no direct day-to-day management of this particular job and had no conversations himself with anyone from Pole-Fab. Moreover, despite the hearsay evidence he was giving at trial, he gave no details of which person from his company spoke with which person at Pole-Fab and when they did. No evidence from those witnesses themselves confirming that is why the AMG poles were ordered was provided at trial.
13In fact, this evidence at trial was clearly contradicted by the contents of the letter he personally wrote to Rankin and the Region on February 24, 2011. In that letter, he did not suggest that Pole-Fab had sold the poles originally ordered by Weinmann. Rather, the only reason given by him then for using AMG poles was that Pole-Fab as the sole supplier of the poles was being unrelenting in demanding that Weinmann pay for the poles on delivery. In that letter, Mr. Toppazini said that Weinmann simply could not do so which was the only reason why Weinmann did not supply Pole-Fab poles. That in my view was the real reason for Weinmann not doing so.
14His evidence at trial that he obtained replacement poles from AMG because it would take 8 to 12 weeks to have Pole-Fab supply new ones which was beyond the required installation date is simply not credible evidence and is rejected.
15If that conversation between someone from his company and Pole-Fab took place in late September or early October as Mr. Toppazini suggests, that would likely have been sufficient time to reorder them for a December installation. As indicated above, there is no reliable evidence that the Pole-Fab poles could not have been supplied and installed on time.
16Significantly, his own evidence at trial was that he did not even ask Rankin and/or the Region for an extension of time to do so in the fall of 2010. When he asked for an extension to replace the ones Weinmann actually installed with Pole-Fab poles in March 2011, the Region agreed and Weinmann was able to obtain from Pole-Fab replacement poles and have them installed within 30 days, not 8 to 12 weeks.
17It became clear from his evidence that Mr. Toppazini made the conscious and deliberate decision not to advise either Rankin or the Region that it would not be supplying the Pole-Fab poles that all three parties understood were going to be supplied pursuant to the original tender documents and the Region’s requirements and expectations.
18He also admitted Weinmann did not supply drawings for approval by the Region for those replacement poles before they were ordered and installed as required by the tender documents conditions. He bluntly said that he took the risk that the Region would not approve the substituted poles despite the terms of the tender conditions. Nevertheless, he stated that the Region was “obliged” after installation of the non-approved poles to give Weinmann a proper review of the drawings and determine if it would approve these replacement poles. In other words, he implied that the Region could not simply insist that the Weinmann comply with the contract that it supply the Pole-Fab poles all parties agreed would be supplied.
19Mr. Toppazini’s insistence that the Region owed it a duty to review the replacement pole drawings despite Weinmann’s breach of the conditions of the tender terms and by its not supplying the Pole-Fab poles is unreasonable to say the least.
20Moreover, his knowledge that the Region required drawings and its preapproval before any poles other than Pole-Fab poles were installed and Weinmann installing the poles without Weinmann itself having seen the drawings to confirm whether they met the specifications of the tender documents is also rather incredible evidence. Mr. Toppazini knew that if there was any confusion as to which materials could be supplied including other than Pole-Fab poles, the tender documents required him to seek clarification of that before the materials were manufactured, installed and used. This effectively allowed the Region the opportunity to inspect and make its own determination as to whether replacement poles would be acceptable.
21Mr. Toppazini suggested that the superseding guidelines SSP 41 and SSP 42 take precedence over the tender documents which he says allowed Weinmann to use substitute poles from AMG instead of the contemplated Pole-Fab poles that were preapproved by the Region.
22I do not agree with that position.
23Firstly, he agreed that SSP 10 of the tender documents required that all materials supplied for electrical work must be approved by the Region before used on the site.
24Secondly, he agreed that he did not even comply with SSP 41 conditions which required Weinmann to provide the drawings for any proposed replacement items before they were manufactured and ordered and installed on-site. He agreed that the SSP 41 conditions worked in addition to the general conditions of the tender contract. Those specifications do not in my view replace the conditions of the tender document but simply add to them.
25The conditions of the tender contract confirmed that Weinmann must provide drawings for preapproval of any material supplied by the Region. The only reason they weren’t provided by Weinmann for the Pole-Fab poles was because the Region had already preapproved them given its prior usage of those poles in the Region.
26When cross-examined on whether he thought the Region was entitled to stipulate the types of materials for its required equipment and tender process, Mr. Toppazini was very hesitant in his response finally suggesting that the Region could not refer to the specific manufacturer but rather that the Region owed him a proper review of the drawings he submitted after installation even though Weinmann itself violated the requirements of the contract.
27It became clear in Mr. Toppazini’s evidence that he has had significant animosity towards the Region for some time and has been involved in other litigation with it details of which were not provided to the Court. He made references in his evidence to the Region allegedly breaching the provisions of the Municipal Act by insisting on Pole-Fab as the supplier of the poles and also breaching its own policies and its procurement bylaw. He even suggested that the Pole-Fab poles required by the Region did not meet the specifications of its tender documents. However, no details or proof of any of those allegations including proof of the bylaw was provided at trial.
28He was also very familiar with the preapproval requirements of the tender conditions and in fact asked, through Rankin, for clarification of details of the luminaires being supplied for the poles before he tendered Weinmann’s quote.
29He also had sought preapproval from the Region for other materials supplied by Weinmann in earlier contracts with the Region and acknowledged that this was standard practice. In fact, it is contained in the general conditions of the tender document.
30In effect, Mr. Toppazini essentially admitted that he ignored the contract terms obliging him to provide those AMG pole details to Rankin and the Region and admitted that he knew it was highly unlikely that those drawings would have been approved anyway beforehand. He simply stated that he made the decision to take the risk of not complying with the contract thinking that he would still get the “courtesy of a review” of what he actually supplied to the Region after installation.
31Nevertheless, he clearly stated in his letter of February 2, 2011 to Rankin and the Region that if the Region on its design review confirmed that the AMG poles did not satisfy its requirements, Weinmann would replace the poles at its own cost.
32He then suggested that there was no downside to the Region accepting these other replacement poles as it was “all good” as he as a taxpayer and businessman made that decision effectively on behalf of the Region. He became rather argumentative when cross-examined stating that the Region’s procurement bylaw put suppliers in front of the interests of the municipality in tender issues. Again, no such bylaw document was produced by him. He baldly stated that the AMG poles were all the same structure but then admitted that AMG was just starting to get into the business of manufacturing streetlight poles but had never been approved by the Region as a supplier of streetlight poles in the past or even to date.
33He also admitted that the replacement poles did not have compression markings on them as required by the tender specifications and then suggested that the Region could go out in the field and look at them to satisfy itself that they had been compressed properly during installation.
Murray Krawjewski
[34]
Murray Krawjewski
Mr. Krawjewski was a former Coordinator in the Operations Department of the Region’s Transportation Services Department.
35He was at a project managers meeting in late November or early December 2010 for this job when he stated he heard comments made during discussions between Mr. Tassone, his supervisor and Howard Murray, the Manager of the Region’s Traffic Operations that “we are going to screw Weinmann by going to make him replace the poles”, or “something along those lines”. However, he admitted that they also said that the poles Weinmann installed did not meet the Region’s standards. He said that there was a culture in the department to do everything to make matters difficult for Weinmann whenever possible.
36He never reported this conversation to anyone including his other supervisors and he was saying it for the first time at trial. He left the Region’s employ in February 2011.
37The evidence of this witness is no indication of bad faith on the part of the Region toward Weinmann. The alleged conversation in fact confirms the Region’s rejection of Weinmann’s replacement poles because they did not meet its required standards. Instead, I prefer as more credible the evidence of Mr. Tassone noted below who was clear, concise and adamant in his testimony that there was no such discussion and that any other contractor who attempted to do what Weinmann had done would have been treated the same way.
Stephen Brown
[38]
Stephen Brown
Stephen Brown is a Structural Consulting Engineer for AMG, the manufacturer of the poles initially installed by Weinmann.
39His evidence was that he was asked by AMG to prepare the design and drawings for AMG poles that could be used by municipalities. He did so using the Canadian Highway Bridge Design Code Standards (“Bridge Code”). Although he initially stated he designed the poles for the Region of Niagara, that was not the case as he subsequently admitted that municipalities throughout Ontario have different requirements. He did not see the Region’s tender documents for this particular job and admitted that these were only general plans for these poles for municipalities.
40His initial evidence in chief was that the AMG poles initially installed by the Plaintiff met the standards in the tender documents provided by the Region except for some minor details.
41However, he then admitted that his drawings were not signed and sealed by him until December 22, 2010 after Weinmann had installed the AMG poles on-site, that these installed poles were not actually designed for this particular Region’s contract and its specifications and that he did not check to make sure AMG poles complied with the specifications of the Region.
42He also agreed that the Region as owner of the project alone had the right to decide whether to accept any changes in the materials supplied if they didn’t comply with its specifications. He agreed it was not for the supplier to determine that.
43In particular, he admitted that the hand holes he designed for the AMG poles at the base were located 9 inches lower than the specifications of 1 metre which was required by the Region in its tender documents. He also admitted that there was a minor variation in the AMG hand hole dimensions than which were required in the contract.
44He also agreed that the Region’s contract specifications and Bridge Code required the poles be stenciled with markings designed to confirm the poles were sufficiently compressed together during installation which the Region could verify on inspection. He did not know if the AMG poles were so marked. He suggested that the absence of markings was irrelevant as the poles could be compressed safely anyway. I do not accept his evidence to that effect as the purpose of compression markings is to ensure the poles were adequately and not over compressed during installation.
45As indicated above, he acknowledged that these general shop drawings prepared for these AMG poles were not supplied until after the poles were installed which the Region had not approved as required under the contract. He also agreed that the Region’s contract required that there was to be no fabrication of the poles until the pole drawings were received and approved by the Region. He was not aware if any AMG poles were installed anywhere else in the Region and had not seen any shop drawings prepared for such use elsewhere in the Region.
46He also agreed that the thickness of the baseplates of the poles did not comply with the Bridge Code and also did not comply with the Region’s specifications in its tender contract.
47He also agreed that the AMG poles were 300 W welded steel which is a different steel than the required specification 350 steel which he said was a difference but not an important one.
48His evidence actually supports the Region’s reasons for and justifies its refusal to accept the AMG poles because they did not meet the specifications in its tender documents and no preapproval for them by the Region had been obtained first.
Frank Tassone
[49]
Frank Tassone
Mr. Tassone is now the Region’s Manager of Construction. In 2010, he was the Project Manager for this job to reconstruct and expand Highway 20 which included the installation of streetlights. He gave his evidence in a clear, concise and fair manner and I accept his evidence as factual in its entirety especially where it is contradictory to that of Mr. Toppazini and Mr. Brown.
50He confirmed the Region entered into a contract with the general contractor Rankin Construction. The Plaintiff was not a party to that contract but was a subcontractor of Rankin for the supply and installation of the street lighting poles and luminaires.
51He confirmed the general contract required the contractor to seek clarification of any terms of the tender for the supply of the poles but Rankin, on behalf of the Plaintiff, asked only for clarification of the type of luminaires to be installed on the poles. Although the tender contract itself provided the specifications for these poles but no specific manufacturer, only street lighting poles manufactured by Pole-Fab were on the Region’s approved materials list which was similar to other municipalities in Ontario. This was understood by everyone at the time of tender. There was no confusion about which poles were required by the tender and no clarification was sought by Rankin or Weinmann as none was necessary.
52In fact this tender was the second phase of three tenders for the same pole specifications and approved Pole-Fab poles for that stretch of Highway 20 reconstruction. The first phase had already been completed by another contractor which installed Pole-Fab poles which would have been obvious to Weinmann. That other contractor also completed the third phase using Pole-Fab poles.
53There is no doubt that both Rankin and Weinmann understood at all times that the Region required Pole-Fab poles to be installed on the entire project including this phase 2. Weinmann in fact ordered 47 poles from Pole-Fab shortly after the contract was awarded by the Region.
54The tender contract included a term that all materials supplied by the contractor must be approved the Region before being fabricated and used on site. I accept Mr. Tassone’s evidence that Weinmann would have understood that.
55Mr. Tassone confirmed the Region didn’t know anything about Weinmann installing AMG poles instead of the required Pole-Fab poles until its inspector noticed the different poles after they had been installed. They had not been told these non-approved poles were going to be installed and no shop drawings for them had been provided to the Region.
56When that happened, Mr. Tassone immediately advised Rankin that the AMG installed poles were not approved and did not meet specifications of the contract and requested Rankin immediately comply with the contract and install the correct poles.
57Rankin had not been notified either by Weinmann of its plans to install unapproved AMG poles instead of the required Pole-Fab poles. Rankin did not dispute its obligation to the Region to install Pole Fab poles and the Region’s insistence on Rankin’s complying with the contract terms. Rankin immediately demanded that Weinmann remove the unapproved poles and install the required Pole-Fab poles.
58Mr. Tassone’s evidence confirmed that Weinmann through Mr. Toppazini acknowledged it had not followed the specifications and procedures under the contract. Weinmann simply suggested in its letter of February 2, 2011 that the Region review the AMG shop drawings supplied, that Weinmann would forgo payment until the Region approved the AMG poles but if the Region determined that the installed AMG poles did not meet its specifications, it would immediately remove them and install Pole-Fab poles.
59I accept Mr. Tassone’s evidence that he reviewed the AMG shop drawings supplied with the AMEC Project Coordinator’s Engineer. They both confirmed that the installed AMG poles did not meet the Region’s required specifications which included that:
(i) No allowance was given to Rankin to deviate from the specifications of the contract. In addition, Weinmann did not comply with the contract with Rankin by not first obtaining the Region’s approval for any changes in the contract. (ii) the absence of compression markings on the poles were in breach of the contractual terms. Without them, the installer and the Region could not determine whether the sectional poles were properly installed and compressed and not over compressed and damaged because of that.
(iii) the steel used in the AMG poles was a lesser size steel.
(iv) the access door was 8 to 9 inches lower than that required in the specifications.
(v) the future operations markings had not been installed by AMG.
(iv) the base plate was thicker than specified in the tender contract. Accordingly, it was unknown what the point of failure would be on impact which could pose a safety threat to the Region.
60Mr. Tassone explained the Pole-Fab poles for many years had been approved by the Region (and other municipalities) for its street lighting requirements as they met the required Bridge Code specifications for municipalities. That is the reason why they were the only poles on the Region’s approved materials list required for streetlight poles.
61He stated that if another manufacturer wanted to have its products on the Region’s approved list, it would have to make an application to the Region and supply all the necessary information, materials and drawings. The Region would then do a formal inspection of the company’s facilities and perhaps even have a proposed pole installed in a Region work yard for some period of time to determine the suitability of the galvanizing process before approving the product. That obviously would take some significant time but Mr. Tassone and the Region felt very strongly of their need to do their due diligence because of their liability obligations of ensuring it had a safe product installed on its highways.
62I accept his evidence that if the Region ignored and accepted an attempt by a supplier to install anything but approved materials required in the tender documents, that would expose the Region to claims from other unsuccessful suppliers in the tender process. Weinmann was not being discriminated against by the Region when it required the removal of the AMG poles and installation of the correct ones. Mr. Tassone’s evidence was clear, which I accept, that the Region would demand the same of any other supplier which attempted the same thing Weinmann did.
63Mr. Tassone would not have approved the AMG poles in any event had the AMG drawings been supplied earlier because of these deficiencies. I accept his evidence that these were not minor or insignificant deficiencies from the contract specifications and that only the Region could accept any changes to its specifications in the contract which it did not.
64He confirmed that Weinmann installed three intersection Pole-Fab poles and never advised the Region beforehand of any difficulty it was allegedly having supplying the 47 Pole-Fab streetlight poles. When the Region refused to allow the AMG poles to remain installed, it readily agreed to Weinmann’s request for an extension of time to remove them. Accordingly, Weinmann’s suggestion that it had time constraints to install the poles in December 2010, and hence obtained the AMG poles, has no merit.
Analysis
[65]
Analysis
In this case, there is no question that the Region as owner intended and required that the general contractor Rankin bid on and supply pursuant to the tender streetlight poles manufactured by Pole-Fab as they were the preapproved poles.
66The evidence is also clear that Weinmann was also fully aware at all times of its obligation as subcontractor to supply and install streetlight poles manufactured by Pole-Fab. There was no ambiguity or confusion.
67After Weinmann submitted its tender quote confirming it would supply Pole-Fab poles, it ordered the Pole-Fab poles and was planning on installing them. There is no better way of determining what the parties intended and expected than to look at what they actually did under the contract after it was signed. Montréal Trust Co. of Canada v. Birmingham Lodge Ltd. (1995) 438 (O.C.A.); 978011 Ontario Limited v. Cornell 2001 CanLII 8522 (ONCA).
68There was never any contract between the Plaintiff as subcontractor and the Region as owner of the project in this case. Accordingly, the owner has no duty to the subcontractor except regarding the holdback provisions of the Construction Lien Act. Naylor Group Inc. v. Ellis Don Construction Ltd. 1999 CanLII 3705 (ONCA); 2001 SCC 58; Base Controls Limited 2002 O.J. 3083, 20 C.L.R. (3d) 258; approved in 2003 CanLII 20385(Div. Ct.).
69Weinmann violated the specification terms of the tender including its approval procedures in its contract with Rankin. It admitted it took the risk the Region might or might not approve the AMG poles that did not meet its tender specifications. In this case, the Region as the municipality owner properly took the position that it was entitled to and in the circumstances, had to insist that Rankin, the general contractor, comply with the provisions of its contract with the Region to install the Pole-Fab poles that it required and had preapproved under the tender contract.
70The Region acted reasonably in rejecting the substituted poles that Weinmann had installed without it first advising Rankin and the Region that it planned on doing so, without obtaining any preapproval of the Region and Rankin and without even obtaining and reviewing the AMG construction drawings to determine whether its poles complied with the Region’s requirements under the contract .
71In my view, it makes no common sense why Weinmann would have expected the Region to approve lighting poles for the middle section of the roadway that were different from the poles installed in the other two phases of this three-phase highway project.
72Had the Region not insisted that the substituted AMG poles be removed and that Rankin as the general contractor install the poles required under the tender process, the integrity of its tender process would likely have been very much in dispute. It would have exposed itself to claims by other rejected bidders on the project when they found out the Region had in fact permitted unauthorized and unapproved poles to be installed by Weinmann that did not meet the Region’s specifications. The Court should not make policy decisions in place of the municipality or effectively rewrite the terms of its tender documents.
73There was no contract between the Region and Weinmann and there is no duty or lack of good faith or honest performance between the Region and Weinmann by reason of the Region simply insisting that its contract with Rankin be complied with.
74Weinmann did not submit a bid as a joint venture with Rankin. To conclude that an action by Weinmann against the Region in tort is appropriate when commercial parties have deliberately arranged their affairs in contract would allow for an unjustifiable encroachment of tort law into the realm of contract. Design Services Limited v. Canada 2008 1 SCR 737, 2008 SCC 22.
75The recognition of a new duty of care between an owner and subcontractor in the context of the tendering process is not justified. A recognition of an owner’s duty of care towards subcontractors in the tendering process could lead to a multiplicity of lawsuits in tort which is an undesirable result. Any duty of care by the Region as owner to Weinmann as subcontractor accordingly is negated because of indeterminate liability concerns.
76In any event, the Region at all times acted properly and in good faith in rejecting the AMG poles initially installed by Weinmann even though there is no suggestion by the Region that the AMG poles had any manufacturing defects or were improperly constructed. It confirmed through Mr. Tassone, whose evidence I accept, that had any other subcontractor tried to do the same thing, the Region would have responded in the same manner and required the contractor to comply with its contract obligations.
77The Region never had the opportunity to approve the AMG poles before they were installed on-site and Weinmann deliberately refrained from advising the Region and Rankin what it was doing. It was Weinmann, not the Region, that was acting improperly and in bad faith by so doing.
78The Plaintiff also advances a claim against the Region alleging it caused the Plaintiff damages by reason of its intentional infliction of economic loss on the Plaintiff.
79The essential elements of this tort are:
a) a wrongful or unlawful interference by the Defendant against a third party in which the Plaintiff has an economic interest; and
b) an intention by the Defendant to cause loss to the Plaintiff through the use of the unlawful means.
Correia et al v. Canac Kitchens et al. (2008) 2008 ONCA 506, 91 OR (3d) 353; 2008 ONCA 506; A.I. Enterprises Ltd. et al. V. Bram Enterprises Ltd. 2014 SCC 12.
80The Plaintiff’s claim fails on both counts.
81Firstly, there was no unlawful means or unlawful act against the third-party Rankin by the Region. The Region’s insistence that Rankin Construction comply with the contract is not actionable even if it was meant as an intentional interference with Weinmann’s economic interests as the means used by the Region were not unlawful. Commercial behaviour is permissible even if it results in one party’s economic loss. Causing loss in and of itself is not enough. Correia Kitchens, above; O’Dwyer v. Ontario Racing Commission 2008 ONCA 446.
82Rankin agreed that the Region was entitled to insist on its compliance with the contract and it in turn required Weinmann to comply by removing and replacing the unapproved poles. Weinmann at no time at trial claimed Rankin was in breach of its subcontract by doing so and brought no action against Rankin for damages because of its demands.
83There was no unlawful means as the Region’s conduct did not give rise to a civil cause of action by Rankin or would do so if Rankin had suffered a loss as a result of the conduct.
84Secondly, to be actionable the Region must have had the intention to cause economic harm to Weinmann as an end in itself or because it was a necessary means of achieving an end that serves some ulterior motive. It is the intentional targeting of Weinmann by the Region that would justify stretching the Region’s liability so as to afford Weinmann a cause of action. It is not sufficient that the harm to Weinmann be an incidental or possible consequence of the Region’s conduct even where it realizes that it is extremely likely that harm to Weinmann may result.
85In this case, the evidence does not establish that the Region intended to cause economic harm to Weinmann as an end in itself or because it was a necessary means of achieving an end that serves some ulterior motive. Its only purpose was to ensure that the specifications in its tender contract with Rankin were complied with.
86The action of the Plaintiff Weinmann accordingly is dismissed.
Damages
[87]
Damages
Mr. Toppazini referred to a one page summary document as his proof of Weinmann’s damages totaling $86,084. That summary document simply referred to the cost of Weinmann’s purchasing the replacement Pole-Fab poles of $64,455 including tax and the cost for four different categories of its employees who allegedly worked to replace the poles with the required Pole-Fab poles in April 2011 with their stipulated hourly rates.
88However, no names of the employees, the actual time records for their work, or confirming business or payroll records were produced to support that summary. Mr. Toppazini did not even confirm that he prepared the document himself based on his own personal assessment of his company records and payroll records as compared to some other person in this company who prepared it but who did not give evidence at trial.
89Moreover, Mr. Toppazini tried to claim as additional Weinmann damages its costs for the “recovery rate” of its equipment under MTO policies and guidelines but no supporting documents or an explanation for that were provided to the Court.
90In addition, he purports to claim a figure of 15% as additional Weinmann damages for office overhead with no reasonable explanation or supporting documentation.
91Lastly, he claimed as damages the $68,455 including tax allegedly incurred by Weinmann because of its purchasing the Pole-Fab poles which it was originally required to and in fact ordered for this job in June 2010. One would have thought that if there was a claim for the cost of the poles, it would be the cost of the unapproved AMG replacement poles Weinmann purchased in December 2010, installed and eventually removed because it did not follow proper procedures and the specifications in the contract.
92Mr. Toppazini made it clear in his evidence that if the Region did not approve the AMG poles, they would be removed at Weinmann’s expense and replaced with Pole-Fab poles. The Region did not approve the AMG poles as they did not meet its specifications. Accordingly, there are no damages for which the Region is responsible.
93In addition, Mr. Toppazini provided no evidence as to what Weinmann was charged for the AMG replacement poles, whether it paid for them or returned some or all of them for credit, or whether it has used them or still has them for use in other jobs for other municipalities which would minimize any claim for damages it alleges it sustained.
94I am also not satisfied because of the lack of sufficient evidence that Weinmann suffered any significant damages even if the Region had been found to be in breach of any obligations it owed to Weinmann, which is not the case.
Conclusion
[95]
Conclusion
The Plaintiff’s action is accordingly dismissed. If the parties are unable to agree on the issue of costs, the Defendant can make written submissions to my chambers in Simcoe of no more than three pages in length together with a bill of costs and any relevant offers to settle within 10 days from the date of this decision. The Plaintiff will have a similar right
of response within 10 days thereafter.
April 4, 2016
The Honourable Mr. Justice R.J. Nightingale
ONSC 2201
COURT FILE NO.: 53867/12
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Weinmann Electric Ltd.
Plaintiff
– and –
The Regional Municipality of Niagara
Defendant
REASONS FOR JUDGMENT
The Honourable Mr. Justice R. J. Nightingale
Released: April 4, 2016