Court File and Parties
Court File No.: 11-4705-A-SR Date: 2016-06-20 Ontario Superior Court of Justice
Between: Lisa Blundon and Luke Blundon, Plaintiffs And: Ashton Pools, Ponds and Spas Inc., Defendants And: Benco-Concrete Inc., Third Party
Counsel: Judy Fowler Byrne, Counsel for the Plaintiffs Jarvis Postnikoff, Counsel for the Defendants Harjinder Mann, Counsel for Third Party
Heard: Written Submissions
The Honourable Mr. Justice P.B. Hambly
Ruling on Prejudgment Interest
[1] I rely on the facts set out in my judgment dated May 2, 2016.
[2] I did not address prejudgment interest (“PJI”) in my judgment. I have received further written submissions on this issue. The plaintiffs claimed prejudgment interest in their statement of claim from September 30, 2009. Ashton Pools installed the swimming pool on the property of the plaintiffs in September 2009. The plaintiffs now claim PJI from the date the statement of claim was issued on September 1, 2011. Undoubtedly this is because the prescribed rate for PJI on the date that the statement of claim was issued is 1.3%, which is greater than the prescribed rate of interest when the cause of action arose, which is 0.5%. The accumulated PJI from the date that the cause of action arose to the date of the judgment over 2,406 days is $1,195.45. This is less than the accumulated PJI from the date that the statement of claim was issued to the date of the judgment over 1,705 days, which is $2,202.59.
[3] The Courts of Justice Act provides as follows:
128.--(1) A person who is entitled to an order for the payment of money is entitled to claim and have included in the order an award of interest thereon at the prejudgment interest rate, calculated from the date the cause of action arose to the date of the order.
129.--(1) Money owing under an order, including costs to be assessed or costs fixed by the court, bears interest at the postjudgment interest rate, calculated from the date of the order.
130.--(1) The court may, where it considers it just to do so, in respect of the whole or any part of the amount on which interest is payable under section 128 or 129,
(a) disallow interest under either section;
(b) allow interest at a rate higher or lower than that provided in either section;
(c) allow interest for a period other than that provided in either section.
(2) For the purpose of subsection (1), the court shall take into account,
(a) changes in market interest rates;
(b) the circumstances of the case;
(c) the fact that an advance payment was made;
(d) the circumstances of medical disclosure by the plaintiff;
(e) the amount claimed and the amount recovered in the proceeding;
(f) the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding; and
(g) any other relevant consideration.
[4] The Court of Appeal has stated that an award of prejudgment interest is to compensate the plaintiffs for the plaintiffs’ loss of use of their money and is not to be used as a penalty for the defendant’s misconduct (see: Oakville Storage & Forwarders Ltd. v. Canadian National Railway (1991), 5 O.R. (3d) 1 (C.A.)). Justice Sanderson explained the purpose of PJI in Waxman v. Waxman, 2003 CarswellOnt 52 (S.C.) as follows:
11 In principle, prejudgment interest is payable because a successful party (judgment creditor) has been kept out of money owed to him from the date the cause of action arose or notice was given. The judgment debtor has had the use of that money and theoretically should have been able to earn interest on it in the interim. Delays in themselves should generally not result in reductions of prejudgment interest to which judgment creditors would otherwise be entitled.
[5] I have found that the cause of the cracking of the cement patio adjacent to the house was Ashton Pools pouring liquid concrete on fill, excavated to install the pool rather than on a proper base of sand and gravel. I stated the following:
26 The base material which Ashton employees placed on the ground where the concrete was poured in the area of the cracking was inadequate. It was clayey silt that they had excavated to install the pool, reworked and deposited there. It was impervious to water. Water accumulated in the void under the concrete. The water that did seep into this material stayed in the material. It froze and expanded in the winter which caused the concrete above it to crack. The material that should have been used and was used in the area of TP 2 where there was no cracking was free draining material such as sand and gravel. Benco on Ashton's direction placed insufficient control joints or saw cuts in the south east corner around the posts supporting the deck. This also contributed to the cracking.
[6] Ashton is much experienced at installing swimming pools. He must have known that there was a high probability that the cement patio adjacent to the house would crack because the base on which the concrete was poured was inadequate. The evidence was that the only remedy was to rip out the cracked portion and to reinstall it with a proper base. It has taken the Blundons 7 years to obtain a judgment against Ashton Pools for that to which they were entitled from the moment that the concrete was poured on an inadequate base in September 2009.
[7] In my view, the Blundons are entitled to PJI from September 30, 2009, as they claimed in their statement of claim. To award them PJI from the date that the statement of claim was issued would be to award them more than that to which they are entitled. There is a small amount of money involved but an important principle is at stake.
[8] The plaintiffs shall have judgment against Ashton Pools for PJI from September 30, 2009 until May 2, 2016 in the amount of $1,195.45. They shall also have post-judgment interest at the prescribed rate from May 2, 2016 on the amount awarded in the judgment and the PJI pursuant to s. 129 of the Courts of Justice Act.