Court File and Parties

COURT FILE NO.: CV-15-536748 DATE: 20180625 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Carillion Construction Inc., Plaintiff – AND – City of Toronto, Defendant

COURT FILE NO.: CV-16-564857 AND RE: Carillion Construction Inc., Plaintiff – AND – NORR Limited, Defendant

COURT FILE NO.: CV-14-516955 AND RE: City of Toronto, Plaintiff – AND – NORR Limited, Defendant

COUNSEL: Christopher Hubbard, Brendan Bowles, Daniel Goudge, Claire Seaborn, and Lena Wang, for Carillion Construction Inc. Andrea Gorys and Sandra Astolfo, for NORR Limited Roger Gillott, Kevin O’Brien, and Carly Fidler, for the City of Toronto Howard Wise, for Geo. A. Kelson Co. Limited Daniel Campoli, for Urban Electrical Contractors Michael Tamblyn, for Avenue Building Corp. and York Marble, Tile & Terrazzo Nicholas Richter, for Gilbert Steel Limited Gregory Hersen, for Metrolinx

BEFORE: E.M. Morgan J.

HEARD: June 21, 2018

CASE CONFERENCE ENDORSEMENT

[1] Counsel have again updated me with respect to the progress made since our last case conference in early May 2018.

[2] The good news is that documentary production now appears to be complete as between Carillion, NORR and the City. There are ongoing discussions as to how the Schedule B documents will be handled, but counsel have expressed optimism that the mechanics of that will be worked out shortly.

[3] Executive discoveries are due to start in the fall. Counsel for the City submits that these can be dispensed with in order to save time while working toward the mediation session that will take place in the March-April 2019, and, in particular, in order to make more time to work on expert reports which are to be completed by the end of December 2018. Counsel for Carillion is of the view that the executive discoveries are very important, and that there is no reason to now upset the schedule that has been set. That schedule was set at a case conference in March 2018, and is appended to this endorsement as Schedule ‘A’.

[4] In my view, the executive examinations must proceed as scheduled, at least insofar as the examinations to be conducted by counsel for Carillion are concerned. If counsel for the City and counsel for NORR do not wish to conduct any examinations, that is their right. If counsel for Carillion wishes to conduct examinations as scheduled, that is equally their right.

[5] In any case, all productions must be made available to examining counsel 4 weeks prior to the date that any party is scheduled to be discovered. The parties still have ample time until the end of the year to produce their expert reports. I would expect the schedule to be adhered to in all respects in order not to lose the dates or the momentum toward the mediation session.

[6] Counsel for the City advises that no executive discovery of subcontractors is needed in advance of the mediation. Any subcontractors who intend to serve expert reports or updated claim documentation (or any new claim documentation) must advise counsel for the City of this intention within 30 days of today.

[7] The second piece of good news is that the mediation session with George Adams is on track and is scheduled for 5 days in March-April 2019. Counsel for the main parties (Carillion, the City, NORR) and the lead subcontractors (Urban Electrical, Geo A. Kelson, Quantum Murray, York Marble and Avenue Building), held a preliminary meeting with Mr. Adams, who indicated that as many parties as possible should be in attendance at the mediation. All of the Tier 1 claimants (over $3 million) and Tier 2 claimants ($500,000 – $3 million) will be participating. The Tier 3 claimants (under $500,000) have also been invited to participate, and for the most part they will participate through the general contractor, Carillion.

[8] Counsel for Carillion advises that A.I.G. Insurance Co., the bonding company for Carillion’s material payment and lien bonds, has indicated through its counsel that it intends to attend at the mediation session. In addition, Ernst & Young, the monitor for Carillion in its CCAA proceedings, will attend the mediation as an observer.

[9] I am advised that Carillion, NORR, the City, and the lead subcontractors have agreed on an apportionment of the costs of the mediation.

[10] There was a case management meeting with Master Albert on June 5, 2018. Most of the lien claimants have now made documentary production, with at least one arriving at the meeting with boxes of documents in tow. The Master gave any subcontractors who have not complied with their production obligations 30 days to comply, after which the City may move to dismiss their actions. The next meeting with Master Albert is scheduled for July 10, 2018.

[11] Master Albert is preparing to retire. The lien claims will presumably be part of the mediation discussions with Mr. Adams, and if the matter settles those claims will doubtless settle along with everything else. If the matter does not settle, there will be some decisions to be made with respect to management of the lien claims. It is unclear at this point whether there will be a new construction lien master taking over the task that Master Albert has been handling very capably to date. The parties may have to contemplate de-referencing the lien claims and joining them to this process; but that consideration is for another day.

[12] Counsel for NORR advises that her client expects to serve its claim for fees against the City within a few weeks. She indicates that this claim is self-standing and will not delay the mediation or anything else in the main claim.

[13] The City has now served an Amended Third Party Claim on Metrolinx. The purpose of this amended pleading was to fill in particulars that had been missing from the original version. The claim covers two main issues: water ingress and vertical access within the project. Additionally, counsel for Metrolinx points out that the Amended Third Party Claim also contains language that suggests that the City is raising claims that are beyond these two issues. As an example, he points to a paragraph seeking to hold Metrolinx responsible for change orders by other contractors occasioned by water ingress, as well as the cost of delay allegedly caused by Metrolinx.

[14] Counsel for Metrolinx just recently received the Amended Third Party Claim and so has not yet had a chance to study it with his client. Thus far, however, Metrolinx does not see the Amended Third Party Claim as being quite as focused and well-defined in terms of issues as it had hoped. There is a possibility of a further Demand for Particulars, or a motion to strike the entire Third Party Claim based on a Limitation Act defense, or a motion to strike based on a failure to comply with time periods set out in the Rules of Civil Procedure.

[15] It is important that Schedule ‘A’ be adhered to, as it will allow the parties to proceed along two simultaneous tracks – that is, to prepare for mediation and to pursue their claims and defences in full. The production schedule, expert report schedule, and executive discovery schedule are all designed to facilitate the dual objective. Likewise, a schedule for the proceedings as between the City and Metrolinx must be similarly fashioned.

[16] Metrolinx is to advise counsel for the City by the end of the day on Friday, July 13, 2018 how it intends to proceed. If Metrolinx desires further particulars, it must serve its Demand for Particulars by that date. If it decides to bring a motion, it must serve its Notice of Motion by that date. If it will be pleading, it must state by July 13th when it expects to serve its defence to the Third Party Claim and must advise whether, when, and against whom it will be issuing any Fourth Party Claim.

[17] The City is to provide its response to any Demand for Particulars served on it by Metrolinx by Friday, July 20, 2018. The next steps in the Third Party Claim, and/or the timing of any motion by Metrolinx (and deadlines for any further materials relating to that motion) can be discussed at the next case conference.

[18] The next case conference in this matter is scheduled for Monday, July 23, 2018, at 10:00 a.m.

Morgan J. Date: June 25, 2018

Schedule ‘A’

Carillion Construction Inc. v. City of Toronto CV-15-536748 Carillion Construction Inc. v. NORR Limited CV-16-564857 City of Toronto v. NORR Limited CV-14-516955

Case Conference – June 21, 2018

Mediation Timetable

Date	Step Toward Mediation
July 23, 2018	Carillion and NORR to deliver the list of topics and documents they intend to cover during the examination of the City of Toronto’s representative.
August 20, 2018	Carillion and the City of Toronto to deliver the list of topics and documents they intend to cover during the examination of NORR’s representative.
August 20-22, 2018	Executive examination for discovery of the City of Toronto’s representative, Rick Tolkunow.
August 27, 2018	The City of Toronto and NORR to deliver the list of topics and documents they intend to cover during the examination of Carillion’s representative.
August 31, 2018	Carillion, the City of Toronto, and NORR to provide notice of the types of reports they intend to rely on for the purposes of mediation.
September 17-19, 2018	Executive examination for discovery of NORR’s representative, David Barrington.
September 24-26, 2018	Executive examination for discovery of Carillion’s representative, Tim Parsons.
November 1, 2018	Carillion to deliver its expert reports for the purposes of mediation.
November 15, 2018	The subcontractors participating directly in the mediation to deliver any additional information and/or expert reports they intend to rely on for the purposes of mediation.
December 31, 2018	The City of Toronto and NORR to deliver their responding expert reports for the purposes of mediation.
January 30, 2019	Carillion and the subcontractors participating directly in the mediation to deliver their mediation memoranda.
March 1, 2019	The City of Toronto and NORR to deliver their mediation memoranda.
March 26-28, and April 1-2, 2019	Mediation with George Adams.