CITATION: Winmar v Steak & Sushi, 2017 ONSC 5930
COURT FILE NO.: 16-69079
DATE: 2017/10/04
SUPERIOR COURT OF JUSTICE - ONTARIO
BETWEEN 2157760 ONTARIO INC., cob as “Winmar Ottawa, Plaintiff
-and-
2360870 ONTARIO INC., cob as “Steak & Sushi, Defendant
-and-
2360870 ONTARIO INC., cob as “Steak & Sushi, Plaintiff by Counterclaim
-and-
2157760 ONTARIO INC., cob as “Winmar Ottawa and ROLF ROBILLARD, Defendants by Counterclaim Plaintiff
BEFORE: Mr. Justice Robert N. Beaudoin
COUNSEL: Ronald G. McClelland, Counsel for Plaintiff and Defendant by Counterclaim
Michael S. Hebert, Counsel for Defendant and Plaintiff by Counterclaim
HEARD: September 29, 2017
ENDORSEMENT
BEAUDOIN, J.
[1] This is a motion for summary judgment by the plaintiff, 2157760 Ontario Inc. carrying on business as “Winmar Ottawa” (“Winmar”) against the defendant 2360870 Ontario Inc. carrying on business as “Steak and Sushi” (“S & S”) for payment of the sum of $83,261.60.
The facts
[2] S&S carries on business as a restaurant in the City of Ottawa. In early 2015, a fire occurred at its premises causing significant damage. S&S reported the fire to its insurer, Lloyd’s of London. (“Lloyd’s”).
[3] Winmar and S&S the entered into two separate contracts. The first was for emergency repair work and in the second was for restoration services. The contract between the parties provided that Lloyds would not pay the HST portion of the emergency and restoration services as this was not an out-of-pocket expense to S&S. Any funds paid to Winmar for HST would be remitted back to S&S via an HST input tax credit. Most of the cheques received from Lloyds were issued jointly to the plaintiff and S&S. S&S then endorsed the cheques to Winmar.
[4] Following the completion of the emergency service work, S&S contracted with Winmar to perform restoration services. Winmar the subcontracted some of that work to Rolf Robillard, via his company, the Valholl Group Inc. The particulars of that contract are unknown. There is no separate contract between S&S and Robillard/Valholl.
[5] Winmar has been paid for all of its invoices pursuant to the two contracts with the exception of the amounts payable for HST. The amount is not in dispute.
[6] S&S alleges that Robillard was unable to complete the work and that S&S had to take over a substantial portion of it. S&S maintains that it paid some of Robillard’s trades and suppliers and that Winmar redirectd reimbursement funds from Lloyds that were intended for S&S. S&S claims that it has incurred expenses of $81,711.10 relating to work, materials or equipment due to Robillard’s inability to compete the work.
[7] Winmar chose not to cross-examine on the affidavit submitted by S&S through Lee Wagner, one of the owners and a Director of S&S. Winmar did not file any evidence in reply. There is a serious conflict in the evidence that I cannot resolve on the record before me.
The law
[8] Rule 20.04(2)(a) provides that the court shall grant summary judgment if the court is satisfied that there is no genuine issue requiring a trial. In this case, I’m satisfied that there is a genuine issue requiring a trial and this relates to the defendant’s entitlement to set-off monies owing to it against the plaintiff’s claim. This claim to set-off arises from payments that S&S made directly to Robillard for which Winmar received a payment from the insurer and for work that was not completed by Robillard.
[9] The applicable principles which govern the summary judgment process have recently been summarized by the court in Mayers v. Khan, 2017 ONSC 200. The moving party bears the evidentiary burden of demonstrating that there is no genuine issue requiring a trial. It is only after the moving party has discharged its evidentiary burden that the burden shifts to the responding party.
[10] I’m satisfied that S&S has a claim for equitable set-off as against the monies claimed by the plaintiff. In Canaccord Genuity Corp. v. Pilot, 2015 ONCA 716; the Court of Appeal reiterated the principles of equitable set-off at para 57:
[57] In that case, the Supreme Court held that, while legal set-off required mutual debts, equitable set-off could apply where the defendant claimed a money sum arising out of the same contract or series of events that gave rise to the plaintiff’s claim, or was closely connected with that contract or series of events. The Supreme Court noted the following five principles relevant to equitable set-off, at p. 212: (1) The party claiming set-off must show some equitable ground for being protected from his adversary’s demands; (2) that ground must go to the very root of the plaintiff’s claim; (3) the counterclaim must be so clearly connected with the plaintiff’s demand that it would be manifestly unjust to allow the plaintiff to enforce payment without taking into consideration the counterclaim; (4) the claim and counterclaim need not arise out of the same contract; and (5) unliquidated claims are on the same footing as liquidated claims.
[11] I’m satisfied that it would be unjust to grant judgment to the plaintiff without a determination of the counterclaim on the issue of the set-off. S&S claims that it has paid for work for which Winmar has already been paid. Winmar seeks payment from S&S for the same work. There is a clear connection between the two claims and S&S’s claim for payment for expenses it incurred goes to the root of Winmar’s claim. All of the requirements for equitable set-off are met.
[12] It would be improper to grant judgment on Winmar’s claim without a determination of the issue of set-off or the counterclaim.
[13] For these reasons that the motion for summary judgment is dismissed. The parties are to make their brief written submissions with respect to costs within 20 days of the release of this decision.
Mr. Justice Robert N. Beaudoin
Date: 2017/10/04
CITATION: Winmar v Steak & Sushi, 2017 ONSC 5930
COURT FILE NO.: 16-69079
DATE: 2017/10/04
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN 2157760 ONTARIO INC., cob as “Winmar Ottawa, Plaintiff
-and-
2360870 ONTARIO INC., cob as “Steak & Sushi, Defendant
-and-
2360870 ONTARIO INC., cob as “Steak & Sushi, Plaintiff by Counterclaim
-and-
2157760 ONTARIO INC., cob as “Winmar Ottawa and ROLF ROBILLARD, Defendants by Counterclaim Plaintiff
BEFORE: Mr. Justice Robert N. Beaudoin
COUNSEL: Michael S. Hebert, Counsel for Defendant and Plaintiff by Counterclaim
Ronald G. McClelland, Counsel for Plaintiff and Defendant by Counterclaim
HEARD: September 29, 2017
ENDORSEMENT
Beaudoin J.
Released: 2017/10/04