COURT FILE NO.: 104/13 (Simcoe) DATE: 2017 03 31
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
KEEN LANDSCAPING INC. Paul Hosack, Counsel for the Plaintiff
- and -
ANN MARIE STEWART Derek A Schmuck, Counsel for the Defendant
RULING #2: JUDGMENT ON RECTIFICATION COSTS
Barnes, J.
INTRODUCTION
[1] This is the trial of an action commenced under the Construction Lien Act, R.S.O. 1990, Chapter C.30. (The Act). Ms. Stewart (the defendant) and Keen Landscaping Inc. (the plaintiff) entered into a contract to install a fiberglass pool at the defendant’s residence (the property). The defendant’s property is located in Norfolk County (the Corporation of Norfolk).
[2] The plaintiff sued the defendant for failure to pay for the installation of the pool. The defendant denied entering into a contract with the corporate plaintiff; disputed the contract amount and alleged several deficiencies with the plaintiff’s work.
[3] I ruled in favour of the plaintiff but concluded that there were two deficiencies to be rectified. First, the patio steps should be brought into compliance with the Building Code and second, the problem of glue oozing out of the patio stones should be corrected.
[4] My reasons are outlined in Keen Landscaping v Stewart, 2017 ONSC 1925. Those reasons are varied to acknowledge that the defendant has paid $43,433.55 toward the total project price of $87,014.52. This leaves a balance owing of $43,580.97.
[5] Further evidence was called at the trial to enable me to determine if the plaintiff had satisfied the statutory preconditions for substantial performance and completion of the project as set out in section 2 of the Act.
[6] I have carefully considered all of the evidence in this trial, as well as all of the submissions of counsel. However, I will not reproduce all of the evidence or all of the submissions of counsel. I only refer to those portions of the evidence and submissions that are necessary to provide context for and explain the conclusions I have reached.
[7] I conclude that substantial compliance and completion under the Act requires the following rectification: A complete removal and rebuilding of the patio stairs; certification that construction does not adversely affect the grading of the backyard and conforms with the drainage by-laws of the Corporation of Norfolk and the inspection of the stones to correct the problem of oozing glue as required.
[8] The cost to do this work is C$18,950. The application of HST brings the total cost to $21,413.50. The defendant is credited this amount. The defendant shall pay the plaintiff the balance owing of C$22,167.47 within 15 days.
PRELIMINARY MATTER
[9] During the trial the defendant filed a document book referred to as “defendant exhibit book”. From that book, reference was made to correspondence from Jeff Lavigne, dated November 9, 2007; correspondence from Doug Lyons dated December 21, 2016 and; photographs of the patio steps.
[10] On consent, these documents and the photographs of the patio steps with writing redacted and an attached report removed were made exhibits at the trial. These documents do not appear on the exhibit list and therefore, for greater clarity, these documents are exhibits on this trial. They shall be described as Exhibit 21.
IMPROVEMENT, SUBSTANTIAL COMPLIANCE AND COMPLETION
[11] “Improvement” is defined in Section 1(1) of the Act as:
- (1) “Improvement” means, in respect of any land,
(a) any alteration, addition or repaired to the land,
(b) any construction, erection or installation in the land, including the installation of industrial, mechanical, electrical or other equipment on the land or on any building, structure or works on the land that it is essential to the normal or intended use of the land, building structure or works, or
(c) the complete or partial demolition or removal of any building, structure all works on the land…
[12] Substantial compliance and completion of a contract under the Act is defined in section 2 of the Act as follows:
- (1) For the purposes of this Act, a contract is substantially performed,
(a) when the improvement to be made under that contract or a substantial part thereof is ready for use or is being used for the purposes intended; and
(b) when the improvement to be made under that contract is capable of completion or, where there is a known defect, correction, at a cost of not more than,
(i) 3 per cent of the first $500,000 of the contract price,
(ii) 2 per cent of the next $500,000 of the contract price, and
(iii) 1 per cent of the balance of the contract price. R.S.O. 1990, c. C.30, s. 2 (1).
Idem
(2) For the purposes of this Act, where the improvement or a substantial part thereof is ready for use or is being used for the purposes intended and the remainder of the improvement cannot be completed expeditiously for reasons beyond the control of the contractor or, where the owner and the contractor agree not to complete the improvement expeditiously, the price of the services or materials remaining to be supplied and required to complete the improvement shall be deducted from the contract price in determining substantial performance. R.S.O. 1990, c. C.30, s. 2 (2).
When contract deemed completed
(3) For the purposes of this Act, a contract shall be deemed to be completed and services or materials shall be deemed to be last supplied to the improvement when the price of completion, correction of a known defect or last supply is not more than the lesser of,
(a) 1 per cent of the contract price; and
(b) $1,000. R.S.O. 1990, c. C.30, s. 2 (3).
[13] Substantial compliance and completion under the Act requires the following rectification: A complete removal and rebuilding of the patio stairs; certification that construction does not adversely affect the grading of the backyard and conforms with the drainage and grading by-laws of the Corporation of Norfolk (the by-law) and; the inspection of the stones to correct the problem of oozing glue.
RELEVANCE OF THE PROPERTY’S GRADE
[14] The focus in this portion of the trial is on the costs to remedy the deficiencies in the use of glue on the stones and the deficiencies in the construction of the patio steps. The cost of re–grading the property is considered only if the property’s grading is impacted by the rectification of these deficiencies.
[15] I conclude that prior to the completion of the pool in the defendant’s backyard, the property was in conformance with the by-law. The installation of the pool changed the grading of the property. Once construction changes a property’s grade, the by-law requires an inspection to determine whether the property’s grade remains in conformance with the by-law. This is required irrespective of whether the construction caused negative or positive grading on the property.
[16] The plaintiff did not have the grading of the property inspected in accordance with the by-law. Therefore, I cannot determine whether the property was in conformance with the by-law after the completion of the project or the impact of the defendant’s removal of the pool and patio stones on the grading of the property and therefore, on whether the property conforms with the by-law.
[17] It is unreasonable to interpret an “improvement” under the Act to include construction on the property that brings a property into noncompliance with the drainage and grading by-laws. In these circumstances, where conformance with the by-law after the project is unknown, a determination of whether the rectification efforts have affected the grade of the property is a relevant consideration.
THE DRAINAGE AND GRADING BY-LAW
[18] The by-law governing the drainage grading of the property is by-law No. 2009 – 216 of the Corporation of Norfolk County. Section 2.11 of the by-law defines “Grade” as follows:
When used in reference to a point, grade means that existing, proposed all as-elevation of that specific point.
When used in reference to surface drainage, grade means that completed percentage relating the change in elevation over the distance.
When used as reference to a building, grade means, the average level of proposed or as constructive crown surface adjacent to the exterior of the foundation wall.
When used in reference to the roadway grade means the road way elevations and grades as established by Norfolk County or other designated authority.
[19] Section 2.12 of the by-law defines a “Grading Certification” as ‘the grading certification as prepared by a consultant which certifies that the property is in conformance with the by-law “.
[20] Section 2.20 of the by-law defines “Swale” as the “shallow sloped channel or grassed area, constructed at the specific grade, to facilitate and control the flow of surface water “.
POSITION OF THE PARTIES
[21] The plaintiff submits that the patio steps can be repaired with the existing stone. No new stone is required. Oozing glue can be removed and replaced. The rectification of the deficiencies does not require any grading to the property. The cost of the whole project should fall under C$3,000, including HST.
[22] The defendant submits that the rectification requires the removal of the patio steps and rebuilding of the steps with new material, an inspection of the stones, the complete removal and replacement of oozing glue and a grading certification to ensure that the rectification activity has not adversely affected the grading on the property. The defendant submits that this should cost just under C$22,000. This figure includes HST.
DISCUSSION/ANALYSIS
[23] The plaintiff said that at the time of the project the property did not and could not conform to the by-law. Mr. Neil Herrewynen is the president of the plaintiff company - Keen Landscaping Inc. On October 27, 2015, he testified that the municipal grading standards require a minimum slope of 2% away from a dwelling.
[24] He said that the defendant’s property was so flat that the property never met the 2% grading requirement prior to the plaintiff’s installation of the pool and it was an impossible standard to achieve after the pool was installed. He said he never told the defendant this.
[25] The Corporation of Norfolk disagrees with Mr. Neil Herrewynen and has certified that the property was in conformance with drainage by-laws at the time it was purchased by the defendant.
[26] Mr. Lavigne was formerly employed as a Municipal Technologist by the Corporation of Norfolk. He confirmed that at the time the defendant purchased her residence, the grading complied with the applicable Corporation of Norfolk County by-law. I reject Mr. Neil Herrewynen’s evidence on this point and conclude that this was the status quo at the time the plaintiff installed the pool at the defendant’s residence.
[27] The construction of the pool changed the grading of the property. Mr. Herrewynen testified that under optimal conditions “a quarter inch per foot distance [of drainage] provides the best possible drainage”. He explained that it was not possible to get the optimal “a quarter of an inch foot of drainage because the pool was only eight feet away from the foundation.” He explained that the plaintiff constructed a swale to move water away from the property.
[28] Mr. Girard testified that when he surveyed the property there was no Swale on the property. Mr. Girard was shown a photograph of the pool area and acknowledged that it was a photograph of a swale. He said he and his team did not see it. Ms. Stewart explained that she had complained to Mr. Herrewynen that the swale was unsightly and the plaintiff removed the swale.
[29] Mr. Girard testified earlier in the trial. He said that his survey of the property showed that the pool created areas of negative drainage, i.e. water draining towards the house. I could accord his evidence very little weight because he had not conducted the measurements or selected the set point for the measurements himself.
[30] Mr Girard was recalled as a witness. He had upgraded his original survey by using a nationally recognized set point. He testified that the pool had created negative drainage on the property. This evidence was based on the old report and therefore the same concerns lead me to attach little weight to his evidence.
[31] The issue of whether or not there was a Swale is a red herring. The fact is that there was a change in the grading for the property. This required a Grading Certification from the County that the property still conformed with the by-law. The plaintiff did not obtain this certification at the completion of the work.
[32] Mr. Lyons is employed as a Development Technologist with the Corporation of Norfolk. He confirmed that if any work was done to a property which caused changes in the elevation a Grading Certificate is required. It is not disputed that the plaintiff did not obtain a Grading Certificate for the property.
[33] There is a dispute as to whether the Swale constructed to provide drainage was still present at the completion of the project. All of this is complicated by the fact that at this time the pool and surrounding patio stones have been removed by the defendant. The impact of this action on the grading of the property is unknown.
[34] The presence or absence of the Swale is a red herring because I conclude that prior to the installation of the pool, the property was in conformance with the grading requirements of the Corporation of Norfolk. The installation of the pool altered the grading of the property. No Grading Certificate was obtained. Therefore, I cannot determine whether, upon completion of the project, the grading still complied with the by-law.
[35] I cannot conclude, on the basis of admissible evidence, that the plaintiff’s installation of the pool brought the property into non-compliance with the by-law.
[36] The construction in the backyard had an impact on the grading of the property. A change in elevation creates a responsibility to obtain certification from the County that the grading on the property is in compliance with the by-law. Therefore, even if the Swale was in existence at the completion of the project it was the responsibility of the plaintiff to ensure that the property remained in conformance with the drainage by-law: see by-law sections 2.12, 2.16, 3.5, 11.0 and 12.0.
[37] Therefore, I am satisfied that any work to rectify the patio steps in the backyard will have an impact on the grading. Thus, any costs associated with addressing the said grading issues are relevant. It is reasonable to expect that the degree of impact on grading will vary depending on the method of rectification adopted.
The Rectification Plans
[38] The preferable rectification plan is that proposed by Mr. Dawson. The pictures filed indicate that all the patio steps fail to meet the Building Code requirement of 6 inches. Neither the plan to dig 3 to 6 inches in front of the first step nor the plan to rebuild the patio steps with the existing stone is sufficient to bring the patio steps into compliance.
[39] The impact of the original pool project, which included the construction of the patio steps, on the property’s conformance with the by-law is unknown. Rectification of the patio steps requires a complete rebuild. Under all those circumstances, the cost should include any costs required to ensure that the construction leaves the property in compliance with the by-law.
[40] Mr. Hockley was the plaintiff’s expert. He does some snow plowing work for the plaintiff counsel’s law firm. He did not visit the property and his opinion is based on photographs and on visual impressions obtained on a drive by of the property.
[41] Mr. Dawson prepared his report without any knowledge that it would be used in litigation. A few days prior to the trial he signed the duty of expert form contemplated by Rule 53.03 of the Ontario Rules of Civil Procedure.
[42] For the forgoing reasons there is reason to be concerned about the independence of each expert, however, I found them both to provide their evidence in a forthright manner. Their evidence was helpful to the court. I accord their evidence equal weight.
[43] Mr. Herrewynen said when he completed the pool project the grade was 5% away from the house. He said there was a Swale that moved water away from the property line. He said digging out the gravel in front of the front patio step would not alter the grading of the property.
[44] He testified that areas where the stones can be inspected and any oozing glue can be removed and repaired. He said the oozing glue will be scraped out and replaced with new glue. He said this process will not discolour the stones.
[45] Mr. Herrewynen testified that his plan will not require any new stone. He expected that the rectification can be undertaken with the existing stone and any breakage of stone will be minimal. If there is any need to replace any stones, wheelbarrows will be utilized to bring in new stones. No heavy equipment will be required.
[46] He said no new grading, building permits, grading permits or survey is required to remedy the patio steps. He estimated that complete rectification of the deficiencies can be completed at a cost of C$2,350 plus HST.
[47] Mr. Hockley testified on behalf of the plaintiff. He was qualified as an expert in the area of providing cost estimates for bringing the patio steps into compliance with the Ontario Building Code. He has 25 years’ experience in the green industry, including the installation of pools and the construction of patios.
[48] Mr. Hockley testified that the patio steps had to be dismantled and rebuilt to bring them into compliance. He explained that this could be done with the existing stone. He said he anticipated no more than 20% breakage in stones. He described this as minimal. He said no heavy equipment was required. If any new stone was required it could be brought to the site using a wheelbarrow.
[49] Mr. Hockley said he did not visit the site. He looked at the backyard and the patio stone steps by driving by the property. He explained that the property is on a corner lot and the patio steps are clearly visible on a drive-by.
[50] Mr. Hockley said he could not determine whether new grading would be required as a result of rebuilding the stairs. He explained that he can only make this determination once he is on site. Mr. Hockley estimated the total cost of his plan to be C$2,327.09 plus HST. He guessed that if any work was required to re-grade the property it would cost between $400-$500.
[51] Mr. Dawson testified on behalf of the defendant. He was qualified as an expert with respect to the procedure and costs required to rectify the patio stairs and bring them into compliance with the Building Code. He was also qualified as an expert with respect to the costs and procedures required to rectify the problem of glue oozing from the stones. He has 38 years’ experience as a general contractor.
[52] Mr. Dawson’s solution included the complete removal of the steps, the sprinkler system, the berm, the planter beds, disposal of all debris, excavation of the berm, grading of the property and the use of new materials to rebuild all of these items as required. His cost estimate was prepared on the assumption that a pool would be installed. Therefore, he would obtain a survey of the property as well as grading and building permits. Mr. Dawson estimated that this will cost C$22,716.50 plus HST.
[53] Mr. Dawson is not familiar with the stone manufacturer used to construct the patio steps, however, he visited the site and provided an estimate after observing the type of stone utilized in the construction of the patio steps.
[54] Mr. Dawson prepared his estimate with the expectation that the berm and planters will be removed, the area landscaped and the pool reinstalled. Therefore, his estimate must be reduced accordingly. The defendant concedes that this adjustment is warranted. Therefore, the estimates for excavation of the berm and sod and to supply and install 150 yards of sod shall be deleted.
[55] The total estimate for rectification is adjusted to $18,950.00 plus HST. The final amount is $21,413.50 cents. The defendant is credited this amount. The defendant shall pay the plaintiff the balance owing of C$22,167.47 within 15 days.
[56] Should the parties be unable to agree on costs, the Plaintiff shall file a cost outline within 21 days. The defendant shall file her cost outline within 42 days.