Maplequest (Vaughan) Developments Inc. v. 2603774 Ontario Inc., 2019 ONSC 5278

Court File No.: CV-18-138469 Date: 2019-09-12 Ontario Superior Court of Justice

Between:

Maplequest (Vaughan) Developments Inc. Plaintiff

– and –

2603774 Ontario Inc., Cicchino Holding Ltd. and Lalu Canada Inc. Defendants

Counsel:

P. Guaragna and M. De Sanctis, for the Plaintiff

M. Title and P. Virc, for the Defendants, 2603774 Ontario Inc. and Lalu Canada Inc.

Heard: July 19, 2019

Reasons for Decision

Charney J.:

Introduction

[1] This is a motion by the defendant, 2603774 Ontario Inc. (260), for an order under s. 47 of the Construction Lien Act, R.S.O. 1990, c. C.30[^1] (CLA), discharging the lien and vacating the registration of the Claim for Lien and the Certificate of Action registered by the plaintiff Maplequest (Vaughan) Developments Inc. (Maplequest).

[2] 260 is the registered owner of the property located on Major Mackenzie Drive in Vaughan, Ontario (the Property). Maplequest, is an adjacent land owner.

[3] The issues on this motion are whether Maplequest meets the definition of "contractor" under the Act, whether 260 meets the definition of "owner", and whether Maplequest registered the lien on time.

Facts

Background Facts

[4] Maplequest owns three parcels of land adjacent to and surrounding the Property now owned by 260. Until November 30, 2017, the Property was owned by the defendant Cicchino Holding Ltd. (Cicchino).

[5] On April 25, 2016, Maplequest and Cicchino entered into an agreement (the "April 25, 2016 Maplequest/Cicchino contract") whereby Maplequest agreed to "design, construct, and upfront the cost of the trunk storm sewer through the Cicchino lands". Maplequest also agreed "to design, construct, and upfront the entire road (sic) of Street 1, which is half on the Cicchino lands from the Maplequest subdivision".

[6] The April 25, 2016 contract provides:

Lastly, to facilitate the construction of all of these works on the Cicchino lands, Cicchino agrees to give Maplequest and their forces Permission to Enter their lands to construct these works listed above and to construct the temporary fill slopes on the Cicchino lands along the Street 1 frontage… Maplequest will fill the portion of the existing pond outfall channel on the Cicchino lands as part of the works at its sole cost, with engineered fill as may be required.

[7] Cicchino agreed to convey its portion of the road to the City of Vaughan and the Region of York upon completion.

[8] The total agreed price for this contract was $1,000,102, which included a 25% contingency fee that was to be held until completion, with any balance to be returned to Cicchino after the works were assumed by the Municipality.

[9] The purpose of the agreement was to permit the development of Maplequest's property by constructing storm sewers, sanitary sewers, watermains and service connections within a street known as Farooq Blvd. The Cicchino Property was located just south of Farooq Blvd., and would benefit from the services provided by Maplequest as part of the construction of Farooq Blvd. 260 describes the agreement as a "cost sharing" agreement between two landowners.

[10] On June 22, 2016, Maplequest contracted with TACC Construction Ltd. (TACC) to provide site preparation, site servicing and roadwork to both Maplequest's property and the Cicchino Property. In the contract between Maplequest and TACC, Maplequest is defined as "the Owner", and TACC is defined as "the Contractor".

[11] 260 asserts that TACC did the work described in Maplequest's claim for lien, and was paid in full for that work by Maplequest. TACC has not registered a lien against the property. 260 asserts that Maplequest provided no labour or equipment of its own. There is no evidence on this motion that TACC remains unpaid for any of the work done on or for the benefit of the Cicchino Property in relation to the April 25, 2016 Maplequest/Cicchino contract.

[12] On November 13, 2017, Maplequest's agent, SCS Consulting Group Ltd. (SCS), delivered a "Landowner to Landowner Claim" to Cicchino, enclosing Maplequest's invoice under the April 25, 2016 Maplequest/Cicchino contract. The invoice was for $1,420,311 for services that had allegedly been completed by Maplequest as of that date. The amount included "20% Soft Costs" and "25% Contingencies". The cover letter from SCS states:

On behalf of our client, Maplequest…please find enclosed a claim for works completed by Maplequest…that benefit the Cicchino lands within the Block 40 (South) Developers Group.

[13] On August 4, 2017, the defendant, Lalu Canada Inc. (Lalu), entered into an Agreement of Purchase and Sale (APS) to purchase the Property from Cicchino. The purchase price was $58,500,000.

[14] On November 6, 2017, the APS was assigned from Lalu to 260, which is related to Lalu (260 is either a controlled or wholly owned subsidiary of Lalu). This assignment is not relevant to the legal issues raised on this motion, and, for the purposes of this analysis, my references to 260 should be understood as referring to both 260 and Lalu.

[15] The closing was set for November 30, 2017. On November 30, 2017, as part of the closing of the APS, Cicchino signed a statutory declaration confirming that there were no amounts outstanding in respect of which construction liens could be registered against the Property.

[16] A vendor's take back (VTB) mortgage was given to Cicchino for $43,875,000 as part of the payment of the purchase price.

[17] On December 4, 2017, counsel for Cicchino wrote to counsel for 260 to advise that Cicchino had received the invoice from SCS "with respect to a claim for works completed by Maplequest (Vaughan) Development that benefit your client's lands within the Block 40 (South) Developers Group which is now the sole responsibility of the new Purchaser of the Lands".

[18] Thus, Cicchino takes the position that Maplequest's invoice must be paid by 260. 260 takes the position that, if Maplequest has any claim, it is an unsecured claim against Cicchino.

The Claim for Lien and Statement of Claim

[19] On November 29, 2018, Maplequest registered a claim for lien on the Property for $1,604,951.40. The claim states that services or materials were supplied from November 9, 2015 to November 29, 2018.

[20] The short description of services or material supplied is "ditch filling, earthworks, sanitary connections, storm connection, upsizing of the storm sewer and water main connections throughout the subject lands".

[21] On December 11, 2018, Maplequest issued a Statement of Claim against 260, Lalu and Cicchino, seeking payment of $1,604,951.

[22] 260 filed its Statement of Defence on January 14, 2019, denying any liability to Maplequest and taking the position that if there is any liability, it is Cicchino, which entered into the contract with Maplequest, who is solely responsible for the costs of any services and material. 260 pleads that at no time prior to the closing of the purchase of the Property was 260 advised by Cicchino of any contract or agreement or amount owing to Maplequest.

[23] 260 has brought a cross-claim in this proceeding against Cicchino for full contribution and indemnity for any amounts it may owe to the plaintiff Maplequest. 260 alleges that it purchased the Property from Cicchino pursuant to an APS with an express and implied duty that Cicchino would disclose all pertinent contracts touching upon and effecting the Property, and that Cicchino's failure to disclose the contract between Maplequest and Cicchino, or to disclose the November 13, 2017 letter and invoice from SCS, was a violation of that agreement and amounted to misrepresentation.

[24] For its part, Cicchino disputes the amount claimed in the SCS invoice of November 13, 2017, alleging in its Statement of Defence that the claim is "uproven, unjustified, excessive and not owed by Cicchino, and any such claim cannot exceed the contract price of $1,000,102". Finally, Cicchino takes the position that, as the owner of the property, 260 is solely responsible for any amounts owing to Maplequest.

Section 47 of the Construction Lien Act

[25] 260 brings this motion under s. 47 of the CLA.

[26] As indicated above at footnote 1, the parties agree that the CLA as it read on June 29, 2018 applies in this case. As of that date, s. 47(1) provided:

47(1) Upon motion, the court may,

(a) order the discharge of a lien;

(b) order that the registration of,

(i) a claim for lien; or

(ii) a certificate of action;

or both, be vacated;

(c) declare, where written notice of a lien has been given, that the lien has expired, or that the written notice of the lien shall no longer bind the person to whom it was given; or,

(d) dismiss an action,

upon any proper ground and subject to any terms and conditions that the court considers appropriate in all the circumstances.

[27] Section 47(1) was amended on July 1, 2018, and now reads:

47 (1) The court may, on motion, order the discharge of a lien,

(a) on the basis that the claim for the lien is frivolous, vexatious or an abuse of process; or

(b) on any other proper ground.

Power to vacate, etc.

(1.1) The court may, on motion, make any of the following orders, on any proper ground:

1. An order that the registration of a claim for lien, a certificate of action or both be vacated.

2. If written notice of a lien has been given, a declaration that the lien has expired or that the written notice of the lien shall no longer bind the person to whom it was given.

3. An order dismissing an action.

[28] It should be noted that both provisions authorize the court to discharge a lien on "any proper ground".

[29] The court is not, on this motion, being asked to resolve any of the contractual issues raised in the Statement of Claim or cross-claims. If the lien is discharged, the contract claim continues as an ordinary civil action, but without the security of the lien (K.H. Custom Homes Ltd. v. Smiley, 2015 ONSC 6037).

[30] The CLA is remedial legislation. One of the purposes is to provide a means of security for payment to contractors and subcontractors who provide services and/or materials for an improvement to land. Given that the remedies provided in the CLA are extraordinary in nature, the statutory requirements of the CLA are "strictly construed both in terms of who is entitled to the remedial benefits as well as the procedure prescribed by the CLA. These time periods give no room for judicial discretion so as to ensure that parties in the construction pyramid know where they stand." Delview Construcitons Ltd. v. Meringolo, 2004 11188, at para. 11 (ON CA); Dalcor Inc. v Unimac Group Ltd., et al, 2016 ONSC 299, at paras. 23, 61.

[31] Section 47 of the CLA provides a general power to the court to discharge liens or dismiss actions that are alleged to not have been preserved or perfected pursuant to the provision of the CLA. It is often stated that a motion brought under s. 47 of the CLA is akin to a motion for summary judgment under Rule 20 of the Rules of Civil Procedure: Diamond Drywall Contracting Inc. v. Ikram, 2016 ONSC 5411, at para. 4: J.D. Strachan Construction Limited v. Egan Holding Inc., 2019 ONSC 522; Dalcor Inc., at para. 30; Brock Contracting v. Kozikowski, 2018 ONSC 7618, at para. 2.

[32] The Rule 20/s.47 analogy was first identified in 1999 (1246798 Ontario Inc. v. Sterling, 2000 29031, at para. 12 (ON SCDC)), when a motion for summary judgment was a very different animal than it is today. In 1999, motions for summary judgment did not permit the court to resolve factual disputes, and a relevant factual dispute or question of credibility meant that the matter had to be left to be determined by the trial judge: Irving Ungerman Ltd. v. Galanis (1991), 1991 7275 (ON CA), 4 O.R. (3d) 545, 83 D.L.R. (4th) 734 (C.A.). This limitation on summary judgment motions was applied to s. 47 motions: Beaver Materials Handling Co. v. Hejna (2005), 2005 23127 (ON SC), 45 C.L.R. (3d) 242 (O.C.J.), [2005] O.J. No. 2733, at para. 24.

[33] The ground rules for motions for summary judgment changed with the amendment to Rule 20 in 2010, and the Supreme Court of Canada's 2014 decision in Hryniak v. Mauldin, 2014 SCC 7, which greatly expanded the fact finding powers of the court on a motion for summary judgment. There was no corresponding change to s. 47(1) of the CLA, and it was not immediately apparent that the expanded fact finding powers under Rule 20 should apply to the unamended s. 47(1). See, for example, G.C. Rentals Enterprises Ltd. v. Advanced Precast Inc., 2014 ONSC 4237, where Shaw J. stated, at para. 24:

The question of whether, on a motion under s. 47 of the Construction Lien Act, the court by analogy may use the new discretionary powers under rules 20.04(2.1) and (2.2) given to a judge hearing a summary judgment motion was not addressed on the motion before me, other than by observation that there have been no reported cases under s. 47 since the release of Hyrniak. Although the case law prior to Hyrniak indicates that a s. 47 motion is analogous to a motion for summary judgment, I am not prepared, without submissions on the issue, to assume that on a s. 47 motion under the Construction Lien Act the court has the new, expanded powers expressly given to a summary judgment motions judge under rules 20.04(2.1) and (2.2), to weigh the evidence, evaluate credibility of a deponent, draw any reasonable inference from the evidence and order that oral evidence be presented by one or more parties. To exercise those powers would go well beyond what the case law to date has indicated should be the procedure on a s. 47 motion.

[34] It appears that later cases like Diamond Drywall and Strachan Construction have referentially incorporated the expanded Rule 20 summary judgment powers into s. 47(1) without reference to the reservations expressed by Shaw J. in G.C. Rentals.

[35] In M. Fuda Contracting Inc. v. 1291609 Ontario Ltd., 2018 ONSC 4663, Boswell J. noted, at paras. 26 and 27, that although a "summary judgment motion is one type of process that falls under the umbrella of s. 47(1)", it is not the only one, and "it would be a mistake to interpret s. 47(1) so narrowly that, in all instances, its use engages the test applicable on summary judgment motions". In M. Fuda Contracting, Boswell J. applied s. 47(1) to a motion to dismiss for delay.

[36] M. Fuda Contracting also dealt with the pre-July 1, 2018 language of s. 47(1), but Boswell J.'s caveat would apply to the post-July 1, 2018 wording as well.

[37] As indicated above, both the pre- and post- July 1, 2018 language of s. 47(1) authorizes the court to discharge a lien on "any proper ground". That language should, in my view, be interpreted consistently with the "culture shift" identified by the Supreme Court of Canada in Hryniak, at para. 2:

[T]o create an environment promoting timely and affordable access to the civil justice system. This shift entails simplifying pre-trial procedures and moving the emphasis away from the conventional trial in favour of proportional procedures tailored to the needs of the particular case.

[38] As such, it is my view that, where a summary judgment-type motion is brought under s. 47(1) of the CLA, the Court may exercise the same kind of fact-finding powers that it now exercises in Rule 20 cases.[^2]

[39] The case before me does engage the summary judgment-type motion because its determination requires the resolution of factual disputes between the parties: was Maplequest a "contractor" or an "owner" within the meaning of the CLA? When was the work on the contract completed? Resolution of these disputes will require the examination of the record provided on the motion, and an important question is whether the material provided on the motion "gives the judge confidence that she can find the necessary facts and apply the relevant legal principles so as to resolve the dispute" (Hryniak, at para. 50).

[40] It is now well settled that "both parties on a summary judgment motion have an obligation to put their best foot forward" (see Mazza v. Ornge Corporate Services Inc., 2016 ONCA 753, at para. 9). Given the onus placed on the moving party to provide supporting affidavit or other evidence under Rule 20.01, "it is not just the responding party who has an obligation to "lead trump or risk losing" (see Ipex Inc. v. Lubrizol Advanced Materials Canada, 2015 ONSC 6580, at para. 28). For the reasons stated above, it is my view that these principles should apply to a motion under s. 47(1) of the CLA.

[41] If the court is going to incorporate Rule 20 jurisprudence into s. 47(1) motions, however, we have to take the bitter with the sweet.

[42] It is important to note, therefore, that the underlying contract claim in this case will survive even if the lien is discharged. In some respects this s. 47(1) motion is more akin to a motion for partial summary judgment, because the motion will decide only one issue, and the balance of the action will continue to trial. The Court of Appeal has cautioned against motions for partial summary judgment: Butera v. Chown, Cairns LLP, 2017 ONCA 783, at paras. 28 – 34, stating, at para. 34:

A motion for partial summary judgment should be considered to be a rare procedure that is reserved for an issue or issues that may be readily bifurcated from those in the main action and that may be dealt with expeditiously and in a cost effective manner.

[43] The Court of Appeal was particularly concerned about granting partial summary judgment where it is possible that the trial judge "will develop a fuller appreciation of the relationships and the transactional context than the motions judge" which could risk "inconsistent findings and substantive injustice": Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450, at para. 37. See also: Mason v. Perras Mongenais, 2018 ONCA 978.

[44] Accordingly, I will consider the issues raised by 260 with these principles in mind.

Statutory Framework

[45] Section 1(1) of the Act defines "contractor" as:

"contractor" means a person contracting with or employed directly by the owner or an agent of the owner to supply services or materials to an improvement and includes a joint venture entered into for the purposes of an improvement or improvements.

[46] The Act also defines "owner" as:

"owner" means any person, including the Crown, having an interest in a premises at whose request and,

(a) upon whose credit, or

(b) on whose behalf, or

(c) with whose privity or consent, or

(d) for whose direct benefit,

an improvement is made to the premises but does not include a home buyer;

[47] The phrase an "interest in the premises" is defined under s. 1(1) of the Act as follows:

"interest in the premises" means an estate or interest of any nature, and includes a statutory right given or reserved to the Crown to enter any lands or premises belonging to any person or public authority for the purpose of doing any work, construction, repair or maintenance in, upon, through, over or under any lands or premises;

[48] Section 14(1) of the Construction Lien Act provides that a person who supplies services or material to an improvement for an owner, contractor or subcontractor, may claim a "lien upon the interest of the owner in the premises improved for the price of those services or materials".

Analysis

[49] 260 raises two distinct arguments on this motion. The first relates to the definition of "contractor" and "owner" under the CLA, and depends, in part, on the interpretation of the April 25, 2016 Maplequest/Cicchino contract. The second argument relates to the timing of the registration of the lien, and whether the lien was registered in accordance with the strict time requirements under the CLA. I will deal with these two arguments separately.

(i) Contractor/Owner

[50] 260's first argument is that Maplequest is not a proper lien claimant because it is not a contractor under the Act. It argues that Maplequest has not provided any services or material to the improvement, because Maplequest retained TACC to act as the contractor. 260 argues that Maplequest does not have a lienable claim for its own work, but is liening for work done by TACC, which has already been paid for its work on the Property.

[51] 260 argues that Maplequest was acting as the property owner, arranging for improvements to its own property so that it could be used for housing development. An owner, or a person who controls the owner, cannot put a lien on its own property: Big Creek Construction Ltd. v. York-Trillium Development Group Ltd., 1993 9335 (ON SCDC). The Cicchino Property was included in this plan because the properties adjoined and the improvements to the Maplequest Property could not be made without access to and work on the Cicchino Property.

[52] 260 points to the terms of the Maplequest contract with TACC, which identified Maplequest as the owner and TACC as the contractor, and the correspondence from SCS, which refers to a "Landowner to Landowner" claim. At all times, 260 argues, Maplequest was acting as an owner, not as a contractor.

[53] 260 also relies on the cross-examination of Abubakar Masood, the representative of the plaintiff. Mr. Masood acknowledged on cross-examination that it was TACC that did all of the work described in Maplequest's claim for lien. Mr. Masood acknowledged that Maplequest did not have any labourers or equipment on the site, and did not have any direct forces that provided site servicing or any construction work.

[54] 260 also argues a lien can only be claimed "upon the interest of the owner in the premises", and 260 is not an "owner" under the Act, because the work done on the Property was not done on its behalf, or with its privity or consent or for its direct benefit. There is no contract between Maplequest and 260. Unlike some jurisdictions, the Ontario CLA does not include in the definition of "owner" persons whose rights were acquired after the commencement of the work or services in respect of which the lien is claimed.

[55] 260 also takes the position that Cicchino is no longer an owner of the property because Cicchino sold the property to 260, which is the registered owner. 260 argues that a mortgagee cannot be an "owner" under the CLA.

[56] Maplequest acknowledges that it is the owner of the adjoining land, but points out that it is not the owner of the liened Property that was owned by Cicchino and is now owned by 260. Maplequest has no corporate relationship to or control over either Cicchino or 260. While an owner, or a person who controls the owner, cannot put a lien on its own property, the fact that Maplequest owns adjoining property does not prevent it from asserting lien rights against property owned by 260.

[57] Maplequest argues that it was acting as a general contractor in relation to the work done on the Cicchino Property. It points to the terms of the April 25, 2016 Maplequest/Cicchino contract, which states that Maplequest is to "design" and "construct" the storm sewer and road, indicating that it was to act as the general contractor on behalf of Cicchino. Maplequest has filed the affidavit of Mr. Masood, which states that Maplequest negotiated and entered into at least nine agreements with subcontractors/suppliers to perform and supply services and materials on the Property.

[58] Cicchino was not a party to the Maplequest/TACC contract, and, therefore, the description of the parties in that contract do not define the capacity of the parties in the April 25, 2016 Maplequest/Cicchino contract. There is nothing that prevents Maplequest from being the "owner" in the contract with TACC, but a contractor in the contract with Cicchino.

[59] Maplequest argues that it meets the definition of contractor under the CLA: it contracted with the owner of the Property (Cicchino) to supply services to an improvement, and fulfilled its obligations under the contract.

[60] Furthermore, Maplequest argues that whether or not 260 is an "owner" under s. 14(1) of the CLA, Maplequest has a valid lien against the property because Cicchino continues to be an "owner" under the CLA. The VTB mortgage assumed by Cicchino when the sale closed gave Cicchino an "interest in the premises" within the definition of "owner" under the CLA. Owners under the CLA are not restricted to registered owners.

[61] In Parkland Plumbing & Heating Ltd. v. Minaki Lodge Resort 2002 Inc., 2009 ONCA 256 the Court of Appeal discussed the requirements of the definition of "owner" in the Act. The Court stated, at para. 61:

To fit within the definition of "owner" under s. 1(1) of the Act, three prerequisites must be met: (i) the person said to be an owner must have an "interest in a premises"; (ii) that person must have "request[ed]" an improvement to the premises; and (iii) the improvement to the premises must have been made on the credit, on behalf of, with the privity or consent of, or for the direct benefit of the person said to be an owner.

[62] The Court of Appeal held (at para. 64) that:

An estate or interest of any nature in premises, including a mortgage, satisfies this definition: see for example, Muzzo Brothers Ltd. v. Cadillac Fairview Corp. Ltd. (1982), 1981 1905 (ON SC), 34 O.R. (2d) 461 (S.C.), at p. 469; Roboak Developments Ltd. v. Lehndorff Corp. (1986), 39 R.P.R. 194 (O.H.C.J.), at p. 202, aff'd (1987), 47 R.P.R. 275 (Ont. Div. Ct.).

[63] Indeed, given the size of the VTB mortgage given by Cicchino, Cicchino continues to have a greater financial stake in the property than 260.

[64] In this case Cicchino has an interest in the property by virtue of its VTB mortgage. There is no real dispute that the work performed on the property was done at Cicchino's request, and with its consent. Cicchino therefore remains an "owner" under the CLA, and its interest is subject to a lien claim by Maplequest.

(ii) Conclusion re: Contractor/Owner

[65] In my view, this is not an appropriate case to discharge the lien and grant what amounts to partial summary judgment on either of these two issues:

i. Whether Maplequest was acting as a "contractor" in performing its obligations under the April 25, 2016 Maplequest/Cicchino contract; and

ii. Whether Cicchino remains an "owner" under the CLA by virtue of its VTB mortgage.

[66] With respect to the first question of whether Maplequest acted as a "contractor" in this case, 260 relies on a lawyer's affidavit, and its argument is based primarily on the wording of the contract between Maplequest and TACC. 260 filed no evidence from anyone with personal knowledge of the April 25, 2016 contract or personal knowledge of the work performed under the contract. No evidence has been filed on behalf of anyone representing Cicchino with regard to this issue. The answers given by Mr. Masood on cross-examination, and relied on by 260 on this motion, are not, by themselves, determinative of this issue.

[67] In my view, Maplequest has raised a triable issue with respect to this element of the lien claim. It is an issue on which the trial judge "will develop a fuller appreciation of the relationships and the transactional context than the motions judge". The record filed by 260 on this motion fails to give me the confidence that I "can find the necessary facts and apply the relevant legal principles so as to resolve the dispute" with regard to this issue.

[68] With respect to the second question of whether Cicchino remains an "owner" under the CLA, the two defendants, Cicchino and 260, have a dispute over who is to pay for the construction performed by Maplequest and its subcontractors. Both defendants may be owners under the CLA, and Maplequest only has to be correct about one of the defendants for the lien to be valid. I am satisfied that Maplequest has raised a triable issue with respect to the question of whether either 260, or more likely Cicchino, is an "owner" within the meaning of the Act, and therefore has an interest that can be liened under s. 14(1) of the Act.

(iii) Expiration of Lien

[69] Under s. 31 of the Act (prior to the July 1, 2018 amendments[^3]) a lien expires 45 days after the contract has been substantially performed or the date the contract is completed, abandoned or terminated. Section 31(1) and (2) provide:

31 (1) Unless preserved under section 34, the liens arising from the supply of services or materials to an improvement expire as provided in this section.

Contractor's liens

(2) Subject to subsection (4), the lien of a contractor,

(a) for services or materials supplied to an improvement on or before the date certified or declared to be the date of the substantial performance of the contract, expires at the conclusion of the forty-five-day period next following the occurrence of the earlier of,

(i) the date on which a copy of the certificate or declaration of the substantial performance of the contract is published as provided in section 32, and

(ii) the date the contract is completed or abandoned; and

(b) for services or materials supplied to the improvement where there is no certification or declaration of the substantial performance of the contract, or for services or materials supplied to the improvement after the date certified or declared to be the date of substantial performance, expires at the conclusion of the forty-five-day period next following the occurrence of the earlier of,

(i) the date the contract is completed, and

(ii) the date the contract is abandoned.

[70] In K.H. Custom Homes Ltd., the Divisional Court confirmed that these statutory deadlines are mandatory. The Court stated, at paras. 3 and 4:

The CLA includes three statutory deadlines that must be met by a lien claimant:

(a) the lien must be "preserved" by registering a claim for lien within 45 days of substantial completion of the improvement or within 45 days of completion or abandonment of the contract or last supply of services or materials to the improvement;

(b) the lien must then be "perfected" within the next 45 days by commencement of an action to enforce the lien, and registration of a certificate of action;

(c) the action must be set down for trial or scheduled for trial within two years of commencement of the action.

These requirements are statutory. They are mandatory. The court has no discretion to relieve from them. The language of the CLA is clear on this point, as is consistent appellate authority. [Footnotes omitted]

[71] Accordingly, assuming that Maplequest was a contractor, it had 45 days from the date the contract was completed or from publication of substantial completion, whichever was earlier, to preserve its claim for lien.

[72] 260 submits that any lien that might have been held by Maplequest expired before November 29, 2018, when Maplequest registered the lien.

[73] 260 argues that the Landowner to Landowner Claim delivered by Maplequest's agent, SCS, on November 13, 2017, was a final invoice, indicating completion of the work to be performed under the April 25, 2016 Maplequest/Cicchino contract. The correspondence specifically refers to the "works completed by Maplequest", and there is no suggestion that any work remains to be completed. While TACC might have continued to perform work for Maplequest after that date, any work done after November 13, 2017 related only to the development of Maplequest's own property, and not to any work on the Cicchino Property pursuant to the April 25, 2016 Maplequest/Cicchino contract.

[74] If this is correct, Maplequest's lien expired no later than December 28, 2017. The lien was not registered until eleven months later, on November 29, 2018.

[75] On cross-examination, Mr. Masood acknowledged that the amount claimed in the November 13, 2017 invoice was the same amount as claimed on the claim for lien. He stated that the claim for lien also includes an amount for HST added to the invoice amount. This provides further confirmation that all the work was completed by the date of the November 13, 2017 invoice.

[76] For its part, Maplequest argues that the construction contract has not been completed, terminated or abandoned because a Certificate of Substantial Performance has not been signed or published.

[77] This is an inadequate response, because under s. 31 of the CLA, the lien expires at "the earlier of" 45 days after publication or 45 days after the contract is completed. A contract can be completed even though a certificate or declaration of substantial performance of the contract is never published.

[78] The November 13, 2017 letter from SRS to Maplequest is compelling evidence that whatever work Maplequest or its subcontractors were doing on the Cicchino Property was completed by the date of that letter. The letter says as much, and Mr. Masood acknowledged that the amount charged represented the total amount agreed to in the April 25, 2016 Maplequest/Cicchino contract.

[79] Maplequest has not suggested any other date for the completion of the contract, and has provided no evidence that any work was done on the Cicchino Property after November 13, 2017. There is evidence that work continued on the Maplequest Property after that date, but no evidence that work continued on the Cicchino Property.

(iv) Conclusion Re: Expiration of Lien

[80] Accordingly, I am able to conclude, on the basis of the evidence provided on this motion, that Maplequest's lien was not preserved within the time required by s. 31 of the CLA.

[81] I order that the Claim for Lien of Maplequest registered on November 29, 2018, as instrument number YR2903486 be discharged, and the Certificate of Action registered on December 12, 2018, as instrument number YR2909631, be vacated from the title of the Property.

[82] This decision is without prejudice to any other claims made in the Statement of Claim.

Costs

[83] 260 is entitled to its costs on a partial indemnity basis. It seeks costs on a partial indemnity basis for fees and disbursements, including HST, in the amount of $37,688.

[84] Had Maplequest been successful, its claim for costs would have been $33,439 on a partial indemnity basis, indicating that the parties had similar expectations regarding the costs of this long motion.

[85] This amount is reasonable, taking into account the complexity of the issues raised and the record that had to be compiled in order to bring this motion. In my view, however, the amount should be reduced somewhat to take into account the fact that although 260 was successful on the motion, they were not successful on the issue relating to the definitions of contractor and owner under the CLA. A significant portion of time was spent on that issue.

[86] Based on these considerations, costs are fixed at $30,000, payable by Maplequest to 260 within 30 days.

Justice R.E. Charney

Released: September 12, 2019

[^1]: The parties agree that, in accordance with s. 87.3 of the CLA, the CLA and regulations as they read on June 29, 2018 apply in this proceeding because the contract at issue was entered into before the July 1, 2018 amendments to the CLA came into effect. I have, therefore, referred to the legislation under its pre-July 1, 2018 name.

[^2]: I note that this analysis applies to s. 47(1) motions brought before a judge, and does not necessarily apply to a motion brought before a Master, an issue that is not before me: See: Brock Contracting v. Kozikowski, 2018 ONSC 7618.

[^3]: This period has been increased to 60 days under the July 1, 2018 amendments.