COURT FILE NO.: CV-16-552087

DATE: 2019 09 20

ONTARIO

SUPERIOR COURT OF JUSTICE

IN THE MATTER OF the Construction Lien Act, RSO 1990, c. C.30, as amended

BETWEEN:

ERVIN’S RENOVATIONS INC.

D. Morris, for the plaintiff

Plaintiff (Defendant by counterclaim)

• and -

NICOLE MARIE ISKANDER and CHRISTOPHER ISKANDER

N. Iskander, for herself

C. Iskander, for himself

Defendants (Plaintiffs by counterclaim)

HEARD: March 19-20, 2019

REASONS FOR JUDGMENT

Master Todd Robinson

[1] Ervin’s Renovations Inc. (“ERI”) was retained by Nicole Iskander and Christopher Iskander, who are sister and brother, to perform a home renovation to their century home at 209 Dunn Avenue, Toronto (the “Dunn Property”). Nicole Iskander is the registered owner of the Dunn Property, and resides there. Christopher Iskander also lives at the Dunn Property. Although the Dunn Property is legally owned by Nicole Iskander, the defendants acknowledge that beneficial ownership is held jointly by both Nicole and Christopher Iskander (together, the “Owners”).

[2] Work proceeded from October 2015 until March 2016, when the relationship between ERI and the Owners broke down. ERI thereafter registered a claim for lien for $34,346.21 on account of unpaid services and materials. ERI perfected its lien by issuing this action and registering a certificate of action on title to the Dunn Property. Nicole Iskander was named as the only defendant. Ms. Iskander denied liability and counterclaimed for $10,791 in overpayment, $27,983 in costs to repair structural damage allegedly caused by ERI, additional unquantified damages for costs to correct deficiencies and complete work, and $7,214 for lost rental income and alternative accommodation (a claim for which no evidence was tendered or arguments advanced at trial). Shortly before trial, on consent, Christopher Iskander was added as a party to the proceeding and now stands in the same position as Ms. Iskander in the litigation.

[3] For the reasons set out below, I have determined that the Owners breached the contract with ERI and are liable to ERI for the earned and unpaid services supplied, less valid set-offs and other defences in favour of the Owners that I have allowed. The result is proven entitlement by the Owners to a nominal judgment against ERI for overpayment.

I. BACKGROUND

a. Contract for Home Renovation

[4] In 2015, the Owners decided to renovate the Dunn Property, including both of their own living spaces and constructing a rentable basement apartment. They engaged Studio Intersekt, an architectural firm in Burlington, Ontario, to prepare architectural drawings for the renovation of the Dunn Property. Frank Vanbetlehem prepared the drawings and subsequently acted effectively as a consultant for the Owners during the course of construction.

[5] Christopher Ervin, the principal of ERI, was introduced to the Owners by their father, Abraham Iskander. Abraham Iskander and Christopher Ervin had a lengthy prior working business relationship, with Mr. Ervin and/or ERI performing a substantial number of unrelated construction jobs for Abraham Iskander over the years. Negotiations followed regarding ERI potentially performing the renovation work at the Dunn Property. Those negotiations were between Christopher Ervin, Christopher Iskander and Abraham Iskander.

[6] In October 2015, ERI was engaged by the Owners to perform the renovation of the Dunn Property. No formal contract was signed. Within a few months of ERI commencing work, Christopher Iskander became the primary point of contact for ERI, although there were still direct communications and dealings with Abraham Iskander throughout the course of ERI’s work.

[7] ERI’s invoices were rendered to Nicole Iskander. Until Christopher Iskander was addeda as a party, the pleadings characterized the renovation contract as being between ERI and Ms. Iskander, with Christopher Iskander and Abraham Iskander acting as agents for Ms. Iskander. Following an admission by the Owners that the contract was, in their view, between ERI and both of the Owners, the consent amendment was made adding Mr. Iskander as a party to the action. The pleadings were amended nunc pro tunc to reflect that admission and the agreement of the parties.

[8] The scope and valuation of ERI’s contract work are issues in dispute in this litigation. However, it is undisputed that ERI’s scope of work did not include HVAC, most electrical work, painting and flooring. Separate contractors were retained by the Owners to perform that work.

[9] Four invoices rendered by ERI in the course of the project are material, namely ERI’s invoice nos. 806, 813, 815, and 816. Each of these invoices addressed different areas of work performed by ERI. Somewhat unusually, rather than issuing new invoices for work performed during the course of the project, the parties agreed to have ERI issued amended invoices with the same invoice number, an updated date, additional progress details, and updated progress invoicing. The invoices ultimately contained a kind of running commentary on the state of project completion. During ERI’s work at the Dunn Property, Abraham and Christopher Iskander had the key dealings with ERI regarding the renovation. Nicole Iskander appears to have had no material dealings with ERI herself.

[10] In March 2016, the Owners engaged NuSite Waterproofing Contractors Ltd. (“NuSite”) to complete certain remedial work of installing a concrete bench to address a structural foundation issue raised by the City of Toronto’s building inspector. As part of ERI’s scope of work, ERI excavated a trench for installation of weeping tile. That excavation proved to have interfered with the angle of repose for the house (an area of soil that cannot be interfered with to ensure proper load distribution for the house) and was believed to have undermined the structural foundation of the house. The concrete bench was remedial work agreed by ERI, the Owners, Mr. Vanbetlehem and the City’s building inspector to address the structural foundation concern, but was not work that ERI was prepared to perform at its own expense.

[11] This structural foundation dispute is a central one in the litigation. The Owners blame ERI for causing the foundation damage and associated costs and expenses that they incurred to remedy the issue. ERI blames the architectural drawings that it was provided, which misrepresented the size of the footings and were relied upon when ERI performed excavation in the manner it did. Accordingly, when ERI was asked to perform the work required to install the concrete bench, ERI viewed it as an extra and quoted the Owners a price to complete it. The Owners took the view that the work was required to rectify a deficiency in ERI’s work, and that ERI was thereby required to do the work at its own expense.

[12] While this primary dispute was ongoing and unresolved, Christopher Iskander was raising deficiencies with ERI’s work and challenging various charges included in ERI’s invoices. Heated emails and texts were exchanged, and some meetings took place to discuss potential resolutions. Ultimately, though, ERI ceased its work on the project and, subsequently, preserved and perfected its lien.

b. Reference History

[13] ERI’s lien has been vacated by order of Master Albert dated September 19, 2017 upon the posting of $42,932.76 in security for the lien with the Accountant of the Superior Court of Justice. That security remains in court.

[14] Following the close of pleadings, a judgment of reference was made in the action by Justice Kristjanson on April 11, 2017, referring the action to be determined by a construction lien master. The action ultimately came on for a first hearing for directions on June 4, 2018 pursuant to the order of Master Albert dated March 21, 2018.

[15] At the time of the first hearing for directions, Master Albert had already announced her retirement from the bench. Master Albert made various procedural orders to allow the litigation to proceed and to ready it for trial, including scheduling a summary trial for two days on December 13 and 14, 2018. Consistent with Rule 55.01 of the Rules of Civil Procedure, RRO 1990, Reg. 194 (the “Rules”) and Section 67(1) of the Construction Lien Act, RSO 1990, c. C.30 (which still remains applicable to this proceeding by operation of Section 87.3 of the current Construction Act, RSO 1990, c. C.30), Master Albert directed that the parties conduct a simplified trial with evidence-in-chief submitted by affidavit and time limited oral cross-examinations.

[16] I was subsequently appointed, in part, to take carriage of Master Albert’s reference matters, including this reference, and the parties consented to my assumption of this reference from Master Albert.

[17] ERI was represented at trial by its new counsel, who was retained after its former counsel was unable to continue. Both Mr. Iskander and Ms. Iskander represented themselves. Ms. Iskander did not conduct any cross-examination herself and relied on Mr. Iskander’s opening and closing submissions as her own.

II. ISSUES

[18] Several issues are in dispute in this action, namely:

(a) What are the terms of the contract (or contracts), particularly as to scope, contract price, extras and timing?

(b) Who breached the contract? In particular, did the Owners improperly refuse payment and interfere in ERI’s work or did ERI abandon the work prior to completion?

(c) What is the value of services and materials supplied by ERI?

(d) Were there overcharges, deficiencies and incomplete work in ERI’s work for which ERI is liable to reimburse the Owners?

III. POSITION OF THE PARTIES

[19] ERI’s position is that the contractual relationship had no fixed price associated with any portion of work performed. ERI’s position is that it was to perform work as needed to keep the project moving and invoice reasonable amounts for the services and materials supplied. This position hinges largely on ERI’s position that the oral contract terms were agreed with Abraham Iskander as agent on behalf of the Owners. Abraham Iskander is said to have trusted Christopher Ervin’s judgment. ERI takes the position that the Owners were aware of all work proceeding and did not object to most invoicing until after litigation commenced. ERI argues that as Christopher Iskander took a greater role in managing the project, payment issues increased and ERI began receiving inconsistent instructions. Mr. Iskander also began engaging other contractors to perform work that interfered with ERI’s work. At trial, ERI argued that it was justified in leaving the job due to non-payment from the Owners and interference in ERI’s work by the Owners engaging other contractors to perform ERI’s scope of work.

[20] The Owners’ position is that ERI was required to estimate all work on a fixed-price basis before starting any work and, except in emergency circumstances, to quote and obtain approval for extra work before undertaking it. ERI is argued to have performed work without authorization and without pre-approval as to price. Work is alleged to have been performed deficiently. ERI is also alleged to have invoiced for work that was never done, invoiced in full for work that was left incomplete, and overcharged or double-charged for other work that was completed. At trial, the Owners argued that ERI has overcharged and been overpaid, and has further has caused them to suffer losses from the cost and expense of completion and rectification contractors. The Owners’ position is that ERI improperly abandoned the contract. Other contractors had to be engaged to complete work that ERI was not performing and did not perform.

IV. WITNESSES

a. Anticipated vs. Actual Witnesses

[21] Proposed witnesses were identified by both sides at the first hearing for directions before Master Albert. At trial, other than a few introductory questions, all evidence-in-chief was led by affidavit. The substantive viva voce evidence at trial was through cross-examination.

[22] At the time of the first hearing for directions, the plaintiff intended to call only two witnesses: Christopher Ervin and one of ERI’s labourers. At trial, ERI relied solely on the evidence of Mr. Ervin and did not call any other witnesses to support its claim or corroborate Mr. Ervin’s evidence.

[23] At the time of the first hearing for directions, four witnesses were to be called by the Owners (although, as noted above, Nicole Iskander was the sole defendant at that time). Those intended witnesses were as follows: Christopher Iskander; Frank Vanbetlehem, an architect and the President of Studio Intersekt; Daanish Memon, an engineer with Terra Firma, a firm engaged to assess the extent of structural foundation damage; and Drago Banovic, a completion contractor engaged to finish work at the Dunn Property. Ultimately, however, the Owners tendered only two affidavits: a detailed affidavit from Christopher Iskander and a brief affidavit from Frank Vanbetlehem.

[24] Abraham Iskander appears to have had a particularly key role in relevant dealings at issue in this action. However, he passed away in February 2017 and accordingly could not be called as a witness. Notwithstanding his passing, emails remained available and many were produced in the litigation and relied upon at trial.

[25] Many individuals other than the three witnesses called participated in the course of the project, such as ERI’s labourers, contractors engaged by the Owners to perform completion and rectification work, and the City’s building inspector who raised concerns with the structural foundation and required that remedial work be performed. None of these individuals were called as witnesses. Direct evidence from many of them would have been probative. Nevertheless, and despite Master Albert’s prior trial order that hearsay evidence was not permitted in affidavit evidence filed, hearsay evidence was tendered by both sides on several central issues in dispute. I have accordingly been required to consider the admissibility of such evidence.

[26] Neither party provided or relied upon any case law in the course of trial. The law on admissibility of hearsay evidence is well-settled, and was recently summarized by the Supreme Court of Canada in R v Bradshaw, 2017 SCC 35. Hearsay is an out-of-court statement tendered for the truth of its contents, the trustworthiness of which is often difficult for the trier of fact to assess because hearsay is declared out of court. Allowing a trier of fact to consider hearsay can therefore compromise trial fairness and the trial’s truth-seeking process. Accordingly, hearsay is only admissible at trial if it falls within an existing exception to the rule against hearsay or if it is admissible under the principled exception, which requires the party tendering hearsay to demonstrate necessity and threshold reliability on a balance of probabilities: see R v Bradshaw, supra at paras. 20-24. These are the principles I have considered and applied when assessing the use of any hearsay evidence tendered by ERI and the Owners.

b. Christopher Ervin, ERI

[27] Christopher Ervin tendered an affidavit of evidence in chief comprised of 24 pages and 100 paragraphs. Although ERI was entitled to file responding and reply affidavits to the Owners’ affidavits of evidence-in-chief, ERI elected not to do so. Mr. Ervin’s affidavit focuses mostly on responding to the overcharging, deficiencies and incomplete work alleged by the Owners, with only short and mostly unsubstantiated evidence tendered on remaining issues, such as contract terms and completion of work.

[28] Mr. Ervin was cross-examined for approximately 1.5 hours. During that time, he presented as an honest witness, who genuinely believed both what he had sworn in his affidavit and his testimony during cross-examination. During cross-examination, however, I found that his recollection of specific events was not as clear as statements in his affidavit made it seem. His evidence on key points is also uncorroborated by other evidence. While I did not find him to lack credibility as a witness, as Mr. Iskander submitted I should find, I have determined that his affidavit evidence and oral testimony is less reliable than the other witnesses, which is a factor I have considered in weighing his evidence.

c. Christopher Iskander

[29] Christopher Iskander’s affidavit is detailed and thorough. Statements made are generally supported by contemporaneous emails or other documents that are appended as exhibits. I have accordingly tended to find Mr. Iskander’s affidavit evidence to be more reliable and given it greater weight as compared to ERI’s affidavit evidence from Christopher Ervin, which is replete with unsupported and often self-serving statements. During cross-examination, Mr. Iskander had a strong recollection of events and was unshaken in them. Mr. Iskander advanced a number of opinions in the course of his viva voce evidence, but in my view lacks the background or sufficient credentials to support those opinions. As they were unsubstantiated by any expert evidence or other admissible opinion evidence, I have accordingly given no weight to opinions expressed by Mr. Iskander on technical issues. Nevertheless, I generally found him to be quite credible and a reliable witness regarding the factual matters on which he gave evidence.

[30] Overall, I have given greater weight to Mr. Iskander’s evidence than to Mr. Ervin’s evidence given the extent of supporting documentation in Mr. Iskander’s affidavit and available corroboration of must of his evidence through contemporaneous documents.

d. Frank Vanbetlehem, Studio Intersekt

[31] Frank Vanbetlehem affirmed a 3-page, 11-paragraph affidavit of evidence-in-chief and was cross-examined for approximately 1 hour. I found Vanbetlehem to be a very honest and forthright witness who, despite his affiliation with the Owners as their consultant for the home renovation, still gave evidence from a neutral perspective. His answers were candid and confident. I found Mr. Vanbetlehem to be credible and his evidence to be very reliable.

V. ANALYSIS

a. Terms of the contract

[32] No written contract was executed between ERI and the Owners. ERI’s position is that no defined scope of work was agreed between the parties in advance, and that ERI was to perform services on a somewhat ad hoc basis, with each item of work becoming akin to a new contract. Mr. Ervin’s evidence is that the time spent on a job and the materials required are not known in advance, so ERI does not provide quotes in advance at a fixed price. Also, because of the age of the Dunn Property, necessary work could not reasonably be anticipated in advance.

[33] The Owners do not dispute that there was no fixed price for all work agreed in advance, but do dispute ERI’s position that there was no defined scope of work. Mr. Iskander’s evidence is that ERI was specifically retained to perform work in four “modules” of scope, each of which was to be separately quoted in advance and invoiced. Those modules were the main floor (invoice no. 806), the basement (invoice no. 813), plumbing (invoice no. 815), and the upper unit (invoice no. 816). Mr. Iskanker’s affidavit states, with particularity, that the general terms of the agreement were as follows:

The parties agreed that [ERI] was to quote each module in advance, on a fixed-price basis, and to obtain authorization from myself or Abe prior to commencing work on the module. The parties further agreed that [ERI] was to quote all scope changes in advance, on a fixed-price basis, and to obtain authorization from myself or Abe prior to implementing any scope changes. Once authorized, any scope and price adjustments were to be incorporated as line-item amendments to the original invoice for the relevant module.

[34] This summary, particularly the process for approval of scope and price adjustments, is supported by emails dated November 3, 4, 13, 14, 15, 16, 17, 20, and 29, 2015. Of particular significance is an email dated November 20, 2015, copied to Christopher Ervin, in which Abraham Iskander outlines to the Owners the process that has been agreed with Mr. Ervin. That email states as follows:

I spoke with Ervin and agreed that each authorized job (module) will have one invoice at the quoted and authorized price. Extra tasks will be priced out in advance, and, when approved, will be completed and added to the same invoice with appropriate notation.

[35] ERI’s position on the nature of the contract and the agreed scope of work is irreconcilable with that of the Owners. Mr. Ervin’s evidence was that ERI was not required to quote all scope in advance, but rather that the agreement with Abraham Iskander was that work could continue so long as costs invoiced by ERI were reasonable. No substantiating evidence for that position was tendered. ERI’s position that there was a general engagement for the project, with agreement that each item of scope would be performed on an ad hoc basis is inconsistent with how ERI invoiced for its work on the project, namely updating existing invoices with new or extra work directly correlating to a module. It is also inconsistent with the contemporaneous emails discussed above.

[36] In my view, ERI’s position on its scope of work is not supported by the totality of the evidence. I find that the parties did agree to have ERI perform work in the four identified modules, initially the main floor and basement modules and subsequently the upper unit and plumbing modules (the latter being intended to encompass all plumbing for the project and removing plumbing from other modules). I also find that the evidence supports there was agreement for ERI to quote the total scope of work required for each of the modules on a fixed-price basis, which was to be approved prior to work commencing. I further find that the parties agreed any changes to ERI’s base scope of work would require an estimate and pre-approval from the Owners before work could proceed, absent circumstances in which it was impractical to obtain such prior authorization, in which case ERI was authorized to conduct work on a time-and-materials basis.

[37] During cross-examination, Christopher Iskander was questioned about the contract price. Mr. Iskander’s evidence was consistent with his affidavit position, namely that there was an agreed base fixed-price for each module. Mr. Iskander’s testimony that the scope of the project was “constantly evolving” and that the price increased iteratively throughout the project is consistent with the evidence on how the project unfolded. Mr. Iskander’s testimony is not inconsistent with an agreed base scope and base contract price for each module. In my view, evidence supports agreement to a base scope of work and contract price for each of the four modules as set out in the first iteration of each module-based invoice in evidence:

(a) Main floor: Scope of work as set out in ERI’s invoice no. 806 dated November 11, 2015, for a fixed-price of $52,424.09, including HST;

(b) Basement: Scope of work as set out in ERI’s invoice no. 813 dated November 5, 2015, for a fixed-price of $21,412.37, including HST;

(c) Plumbing: Scope of work as set out in ERI’s invoice no. 815 dated December 30, 2015 (subsuming and superseding plumbing in other modules), for a fixed-price of $5,424.00, including HST; and

(d) Upper Unit: Scope of work as set out in ERI’s invoice no. 816 dated December 30, 2015, for a fixed-price of $21,876.80, including HST.

[38] In my view, the above is consistent with the contemporaneous evidence filed, the conduct of the parties, and the greater weight I have given to Mr. Iskander’s evidence over that of Mr. Ervin. It is also a commercially reasonable interpretation taking into consideration the circumstances in the context of a home renovation construction contract.

[39] Payment is another disputed issue in this litigation. Nevertheless, ERI tendered no evidence and made no submissions on payment terms. Mr. Iskander’s undisputed evidence on payment terms is that instalment payments reflecting progress would be made periodically, with final payment due upon completion of each work module. That position is supported by the above-noted email from Abraham Iskander to the Owners dated November 20, 2015, copied to Christopher Ervin, purporting to summarize the agreement reached between Abraham Iskander and Mr. Ervin, which was also Christopher Iskander’s evidence during cross-examination. Since there is no contradicting evidence from ERI, I find that payments were agreed to be periodic instalments reflecting actual progress.

b. Breach of the contract and validity of termination

[40] It is undisputed that, in early March 2016, ERI ceased all work on the Dunn Property and left the site. It is clear from emails sent by Christopher Ervin on March 9, 2016 that ERI had no intention of returning to complete outstanding work. However, no formal notice of termination of contract was provided by ERI to the Owners. Similarly, there was no notice of termination by the Owners to ERI.

[41] ERI’s position is that the Owners breached the contract by refusing to pay amounts owing to ERI and by interfering in ERI’s work by engaging separate contractors to perform ERI’s scope of work. ERI feels it was entitled to leave the job. Effectively, ERI’s position is that it was entitled to terminate the contract as a result of the Owners unremedied breaches of the contract. The Owners’ position is that ERI breached the contract by failing to rectify deficiencies, by overcharging and improperly charging for work that was not approved or not completed, and ultimately by abandoning the project.

[42] I deal first with ERI’s allegations of breach by the Owners’ non-payment. It is undisputed that the last payment made by the Owners was a $30,000 payment on January 23, 2016. The only evidence tendered by ERI of demands for payment are general statements made by Mr. Ervin in his affidavit that there were such demands. No specific details of how, when or where such demands were made was tendered in evidence. Mr. Ervin’s bald statements that demands were made are, by themselves, insufficient to support a finding that the Owners breached the contract by non-payment.

[43] I must also weigh the evidence tendered by the Owners regarding challenges in late February and early March 2016 to ERI’s invoices, which supports their position that they believed ERI had been overpaid. In particular, a detailed spreadsheet was prepared and sent to Christopher Ervin on March 8, 2016, which shows a calculated overpayment of $3,197.58 and a damages calculation totalling $27,983 regarding the structural foundation issues (discussed below). The covering email invited Mr. Ervin to meet to reconcile the accounts, and a meeting did occur on March 12, 2016. ERI tendered no evidence on the specific discussions between the parties about reasons for non-payment, including the March 12, 2016 meeting. There is no evidence before the court from which a reasonable inference may be drawn that withholding payment of the $34,346 claimed by ERI was done in bad faith or was not done on the basis of legitimate disputes with ERI’s invoicing. Mr. Iskander’s spreadsheet dated March 8, 2016 provides detailed commentary on his concerns and challenges to invoiced work. There is no evidence from ERI of any response to the spreadsheet. During cross-examination, Mr. Ervin alluded to his own spreadsheet provided to Mr. Iskander, but that was not in evidence. Mr. Iskander’s evidence is that Mr. Ervin did not respond to it and that Mr. Ervin admitted he had not even reviewed it before the March 12, 2016 meeting. That evidence was left undisputed by ERI.

[44] I accordingly find that non-payment by the Owners did not constitute a breach of contract entitling ERI to suspend work or terminate the contract.

[45] I deal next with ERI’s allegation that the Owners breached the contract through interference in ERI’s work by engaging separate contractors to perform ERI’s scope of work. Although Mr. Ervin tendered general affidavit statements that Christopher Iskander retained other contractors to do portions of ERI’s scope, the only incident of doing so for which particularized evidence was tendered relates to installation of the concrete bench. ERI’s alleged negligence in its excavation work and its failure to perform remedial work at its own expense is relied upon by the Owners as a significant breach of contract by ERI. As noted above, dispute over that structural foundation issue is a central issue in the contractual relationship breaking down, so is significant in the assessment of who breached the contract. It is discussed further below.

[46] Turning to the Owners’ allegations of ERI’s breaches of the contract, I deal first with the allegations that ERI breached the contract by failing to rectify deficiencies and through invoicing irregularities. The Owners’ evidence does not support any significant complaints about deficiencies or issues with ERI’s invoicing until sometime in late February 2016. As noted above, between late February and the first week of March 2016, Christopher Iskander began identifying a significant number of deficiencies and was challenging ERI’s invoicing. Meetings to discuss these issues occurred in this period, culminating in the March 12, 2016 meeting. Challenges to ERI’s work and invoicing began ramping up after February 17, 2016, when ERI’s initial quote to complete the concrete bench was sent and an email exchange occurred between Mr. Iskander and Mr. Ervin in which Mr. Iskander clearly relays that he is blaming ERI for undermining the foundation. ERI’s revised and higher quote to complete the concrete bench work for $16,000, incl. HST, was sent the next day.

[47] ERI did not rectify deficiencies because it ceased work on the project, validly in its view, so any breaches regarding deficiencies are, in effect, tied to the circumstances of alleged abandonment. In my view, so too are the Owners’ complaints about invoicing irregularities, which were part of the overall disputes that ended the relationship.

[48] Turning to the alleged abandonment, Mr. Iskander’s affidavit gives evidence of several text messages and emails from Mr. Ervin threatening that ERI will cease work on the project in early 2016. By that time, the relationship between the two men was clearly frayed, but there is no evidence that ERI actually ceased work until early March 2016. At that time, though, it appears cessation of work was initially for the purpose of trying to reconcile invoicing and payment disputes before further work continued. A text message exchange between Christopher Ervin and Christopher Iskander in early evening on March 5, 2016 supports that they had agreed to “go through the invoices before [they] move onto more work”, and that Mr. Ervin wanted an in-person meeting. This is inconsistent with ERI having abandoned the contract. I accordingly do not find ERI’s threats of terminating the contract or leaving the job prior to this time to be sufficient themselves to constitute abandonment. Evidence supports ERI’s continued intention to perform, at least for a time.

[49] In email exchanges in early March 2016, Mr. Iskander continued to identify various items of deficiencies and incomplete work and challenged various charges in ERI’s invoices. As I have already observed, these challenges began to ramp up after Mr. Iskander expressly advised Mr. Ervin that he was holding ERI accountable for the foundation repair costs. ERI’s quote of $16,000 to rectify what Mr. Iskander viewed as ERI’s deficiency was clearly unacceptable to him. By that time, though, ERI had already complete the concrete formwork necessary to complete the concrete bench. When Mr. Iskander first suggested he may engage another contractor, text messages support that Mr. Ervin immediately took issue with any other contractor being engaged by the Owners to do the work.

[50] In my view, the ultimate determination of who breached the contract in this case turns on the structural foundation damage, namely whether or not ERI was negligent in its excavation and if it was obliged to perform the concrete bench work at its own expense. If not, the Owners’ entitlement to retain a separate contractor to perform that work becomes a central issue. The causes and remedial work arising from the structural foundation damage was a focal point at trial.

[51] The Owners tendered evidence on the foundation damage and concrete bench remedial plan from both Christopher Iskander and Frank Venbetlehem. I give Mr. Iskander’s views on the excavation work being deficient no weight, since he lacks any material experience in home renovation and construction. The statements in his affidavit evidence and during cross-examination to the effect that the work was deficient are, in my view, self-serving opinions that he has formed after the fact, rather than grounded factual observations.

[52] It is undisputed that the City’s building inspector raised concerns that the trench excavated by ERI for the weeping tile may have impacted the structural integrity of the foundation. It is also undisputed that the Owners, ERI, Frank Vanbetlehem, and the City’s building inspector agreed that the concrete bench was an acceptable solution to the foundation support concerns. That, however, does not itself mean ERI’s work was deficient or otherwise performed in breach of any contractual requirements.

[53] The City inspector was not called as a witness. ERI does not genuinely dispute that its excavation work undermined the structural foundation of the house on the Dunn Property. Rather, ERI’s position is that ERI’s excavation work was not completed negligently. Mr. Ervin’s evidence is that ERI was not provided with accurate drawings despite requests and that ERI dug straight down in reliance on the representation in the architectural drawings provided that the footings were much larger than the actual size. During cross-examination, Mr. Ervin also stated that he had been instructed to do so by Frank Vanbetlehem, although I have not accepted that position given Mr. Vanbetlehem’s own evidence. Mr. Ervin states that, had ERI known the footings were substantially smaller than what was represented on the drawings, excavation would have been done differently. Specifically, Mr. Ervin states at paragraph 92 of his affidavit as follows:

The Drawings showed a larger existing footing than actually existed by a large amount. If the Plaintiff received n accurate drawing of the footings, the Plaintiff would have done the excavation differently – would have had to do sections, and then pour concrete, being very careful and making the footings a lot bigger, running the plumbing in the footings, and leaving the native soil.

[54] ERI was provided with only architectural drawings from Studio Intersekt, and Mr. Ervin’s evidence is that Christopher Iskander did not accept advice to engage a proper engineer prior to excavation operations. Mr. Ervin’s evidence is also that the concrete bench would always have been required given the actual size of the footings, which is something Mr. Ervin states he advised Mr. Iskander prior to excavation. ERI was willing to repair the issue, and I am satisfied that ERI had prepared the necessary concrete formwork and had necessary concrete mix and other materials delivered to site for completing the work before NuSite was retained by Mr. Iskander. ERI claims it was not given a reasonable opportunity to do the work. NuSite was already on-site conducting the repairs when ERI attended to complete them.

[55] Frank Vanbetlehem’s cross-examination confirmed that ERI was not provided with any drawings regarding excavation for the weeping tile system prior to the City inspection that triggered the structural integrity concerns. He could not recall if Mr. Ervin had requested drawings before commencing work, but acknowledged he could not say with certainty that Mr. Ervin did not make such a request. Mr. Vanbetlehem confirmed that the existing footings were “negligible”.

[56] During cross-examination, Mr. Vanbetlehem was taken to a photograph of the excavated trench dug by ERI for the weeping system. Mr. Vanbetlehem confirmed that the photograph reflected what had been occurring with the weeping tile installation, that he had seen it during his own progress attendances on site, and that the trench was some 4” from the upper wall. Mr. Vanbetlehem’s evidence was that the weeping tile was too close to the support wall. When asked if that opinion was formed prior to the City inspection, his answer was that site discussions had occurred, but he may not have issued specific drawings to that effect.

[57] Significantly, in my view, Mr. Vanbetlehem agreed with ERI’s counsel during cross-examination that the responsibility for considering the angle of repose and locating where weeping tile should be placed was the responsibility of either an architect or a soils engineer. He also confirmed that at no time did he recommend to the Owners that a soils or structural engineer be retained.

[58] The timing of Mr. Vanbetlehem forming his opinion that the excavation and weeping tile installation was improper is unclear from the evidence. Mr. Vanbetlehem prepared a general review report dated January 25, 2016 following a site visit. In that report, under the heading “Observations and Comments”, he states that, “Depth of interior weeping tile appears sufficient so as not to affect adjacent footings”. During re-examination, Mr. Iskander attempted to connect those comments to a sketch located behind that report and said to have been appended. Mr. Vanbetlehem confirmed that he had attached the sketch to illustrate what had been discussed during the site visit as a possible solution. That sketch is substantially the same as the version ultimately forwarded to the City’s building inspector on February 2, 2016, which Mr. Vanbetlehem confirmed during his cross-examination was sent to the City as a proposed remedial solution.

[59] Mr. Vanbetlehem’s opinion on whether or not the excavation and weeping tile was improper was inadmissible opinion evidence. Mr. Vanbetlehem was not tendered as an expert, and, in my view, would not have satisfied the requirements of an independent expert given his direct involvement in the course of construction. No argument was made for him to be considered as a participating expert. Relevant law on participating experts was not raised or argued. Although no objection to his opinion evidence was taken by ERI’s counsel, I have determined that his interests are not sufficiently independent and have given no weight to his opinions on ERI’s work.

[60] The Owners allege that ERI’s excavation was negligent and in breach of contract. Mr. Vanbetlehem acknowledged during his examination that it would be the responsibility of an architect or soils engineer to consider the angle of repose and location of weeping tiles. No soils engineer was engaged by the Owners prior to excavation. Christopher Iskander’s cross-examination of Christopher Ervin did cast some doubt over what drawings ERI was relying on, but Mr. Ervin was clear that ERI did have the set of architectural drawings issued November 19, 2015 before pilot holes were dug and excavation commenced. Those drawings included Drawing A105: Section Details, which was prepared by Mr. Vanbetlehem using a 3/16-inch to 1-ft scale. That drawing clearly indicates much larger footings than actual site conditions. The Owners tendered no expert evidence on the standards applicable to a contractor performing excavation for weeping installation, and there is no other evidence supporting that the excavation performed by ERI was improper or unreasonable in the circumstances.

[61] I find that ERI reasonably relied on the drawings that it was provided as to the size of footings. I find that it was not ERI’s responsibility to investigate the actual footings and soil conditions prior to commencing excavation and weeping tile installation. Mr. Vanbetlehem gave evidence during re-examination that ERI was given no directions regarding excavation. It appears that no conversations about the weeping tile system occurred with ERI. There is no basis in the evidence before me to find that ERI was negligent in how it undertook excavation in reliance on the drawings provided. I also accept ERI’s position that the concrete bench would have been required in any event. The basement excavation and weeping system was within ERI’s scope and ERI was entitled to charge an extra to the Owners for the additional work necessary to adjust to actual site conditions. ERI was not in breach of the contract for refusing to perform that work at its own expense.

[62] It flows from that determination that it was a breach of contract for the Owners to engage NuSite to undertake work within ERI’s scope of work, particularly where ERI had already commenced portions of the remedial work with the Owners’ authorization by preparing the concrete forms and delivering cement mix and a concrete mixer to the site. In my view, the substantial focus by the Owners following that dispute on deficiencies and challenges to ERI’s invoices, while also maintaining that ERI was liable for what was then a $27,983 claim for structural foundation damage, exacerbated the breach. In all the circumstances, ERI was justified in its termination of the contract, and did not improperly abandon the project.

c. Valuation of services and materials supplied

[63] The only damages sought by ERI are the value of unpaid services and materials. ERI has the evidentiary onus of proving its claim for services and materials supplied, and the portion thereof remaining unpaid. ERI’s position is that it is entitled to payment of $34,346.21, which is the amount of the registered claim for lien. This is the balance remaining when the undisputed payments of $99,685 are deducted from ERI’s total invoice amounts of $134,031.21, including HST. Although I have found that ERI was entitled to terminate the contract, that does not excuse it from responsibility for deficient work or accounting for improper charges. The Owners dispute that ERI supplied services and materials totalling $134,031.21 in value. They take the position that various required work was incomplete or deficient and that other work was completed but overcharged.

[64] At the outset of trial, ERI’s counsel advised the court of an agreement with the Owners on the damages calculation: ERI’s agreed total amount invoiced of $134,031.21, including HST, less total payments made by the Owners of $99,685.00, with the total value of items in the Scott Schedule allowed in favour of the Owners subtracted from the invoiced amount and compared to the payments made. Mr. Iskander was directly asked by the court and confirmed that the calculation method was agreed.

[65] As is common in construction cases, the parties prepared and filed a Scott Schedule, which in this case outlines the Owners’ allegations of overcharged, deficient and incomplete work. It further identifies claimed costs of rectification and completion work. ERI’s responses and positions are also included. That Scott Schedule was relied upon by both parties at trial.

[66] As noted, Mr. Iskander acknowledged the agreement on how damages were to be quantified when it was presented to the court at the outset of trial. Mr. Iskander’s only submission during his opening statement was that ERI had the evidentiary burden of proving both alleged breaches of contract and ERI’s damages, and that the Owners had the evidentiary burden of proving their counterclaim. In closing submissions, though, Mr. Iskander argued that the “agreement” was only to the amount of ERI’s invoices, but not that the amounts billed reflect the value of work actually completed or any entitlement to payment. Mr. Iskander maintained in closing that ERI had the evidentiary burden to demonstrate what work was completed and ERI’s entitlement to payment for that work. Mr. Iskander argued that ERI’s claim should fail, in part, because ERI had failed to provide sufficient evidence to substantiate its invoices. I understood this argument to be that ERI failed to prove the extent of all services and materials actually supplied, regardless of whether or not such work was disputed in the Scott Schedule.

[67] In home renovation cases, the use of Scott Schedules for the purpose of identifying what work performed by a contractor is disputed by an owner is a well-established practice. Master Albert made an order for the preparation of a Scott Schedule in Trial Directions #1. At that hearing, leave for examinations for discovery was not sought and, as indicated by Master Albert in her order, would not have been granted. Accordingly, since there were no examinations for discovery in this action, the Scott Schedule served the important purpose of identifying and narrowing issues in dispute by outlining the Owners’ disputes with items claimed by ERI as being completed and payable.

[68] I do not suggest that the Owners’ failure to challenge other aspects of ERI’s work in a Scott Schedule or in affidavit evidence-in-chief is an admission that such work was completed. The Scott Schedule does not displace the evidentiary burden on ERI to prove the extent of work completed and the value of the services and materials supplied. In my view, though, the use of the Scott Schedule in this action is relevant to procedural fairness. The Owners’ affidavits of evidence-in-chef do not challenge any of ERI’s work other than Scott Schedule items. ERI thereby had no notice of additional disputes with its claimed supply of services and materials. The Owners’ position on the state of completion and deficiencies was reasonably necessary for ERI to plan and prepare for trial within the constraints for this summary trial as ordered by Master Albert. Given the ordered use of a Scott Schedule and lack of examinations for discovery, it would be unfair to expect ERI to tender detailed evidence on completion of work unless that work is disputed as being incomplete or deficient. To hold otherwise would render the Scott Schedule meaningless and vitiate the purpose behind the court having ordered it.

[69] In my view, ERI fairly conducted the trial on the basis that the only work disputed as being incomplete, deficient or overcharged was the work set out in the Scott Schedule. That is a factor I have considered in weighing the evidence tendered by ERI to prove both the extent of work it completed and the valuation of its supply of those service and materials. I turn now to ERI’s evidence on the services and materials supplied and valuation of its work.

[70] ERI relies solely on Mr. Ervin’s affidavit and ERI’s invoices to prove that all services and materials claimed to be supplied were, in fact, supplied. I make the following observations regarding them.

[71] Regarding ERI’s invoices, ERI argues that I should give weight to the use of the word “done” in the invoices to support that work was actually completed. Essentially, what ERI asks is that I rely on the word “done” truth of the statement. That is a hearsay use and such evidence is presumptively inadmissible. While the invoices could constitute business records, no notice under Section 35 of the Evidence Act, RSO 1990, c. E.23 was served by ERI as required, so ERI cannot avail itself of the statutory business records exception to the hearsay rule. I am not satisfied that it is necessary to rely on the invoices as proof that work was completed, or that the invoices meet threshold reliability for such purpose given alleged inaccuracies in the invoices. I accordingly find that the invoices do not support ERI’s claim that services and materials were supplied as alleged.

[72] Regarding Mr. Ervin’s affidavit, it provides specific evidence in response to Scott Schedule items. Otherwise, however, it only provides the following statement at paragraph 23 to support that all other work was performed:

The Plaintiff supplied and installed the material pursuant to the Contract and the materials were placed, furnished, and the necessary work was performed on the [Dunn Property] and such labour and materials had been incorporated into the said lands and premises and there remains due and owing to the Plaintiff the sum of $34,346.21.

[73] ERI elected not to call any corroborating witness or to tender any documents directly corroborating ERI’s completion of work. However, having reviewed the Owners’ responding affidavit evidence-in-chief and the oral testimony of the three witnesses, Mr. Ervin’s evidence above is undisputed, except for Scott Schedule items. Accordingly, excluding those specific disputed items identified in the Scott Schedule, which are addressed below, I accept that ERI did complete the balance of work claimed as being performed.

[74] No experts were called by either side regarding the valuation of services and materials. During closing submissions, Mr. Iskander acknowledged that the amounts in ERI’s invoices represent the value of work when completed, although disputed ERI’s entitlement to be paid the total amount invoiced given demonstrated incomplete and deficient work. Ms. Iskander adopted Mr. Iskander’s closing submissions. I accordingly find that the amounts invoiced by ERI for services and materials supplied that are not the subject matter of disputes in the Scott Schedule are properly claimed as the value of such services and materials.

d. Overcharges, deficiencies and incomplete work

[75] In closing submissions, Mr. Iskander categorized the Scott Schedule items into five broad categories (with some overlap): (i) items invoiced by ERI that were not supplied, (ii) duplicative charges, (iii) incomplete work, (iv) deficient work, and (v) excessive or unjustified charges. In addressing each of the Scott Schedule items, I have referred to the Scott Schedule itemization and note the amount claimed by the Owners for each item. I have generally dealt with them in reverse order of magnitude, with some grouping of similar or related items.

i. Structural foundation - $17,078.75 (Scott Schedule Item No. 29)

[76] The Owners’ claim set-off for their costs of an engineering investigation of the impact of ERI’s excavation on the structural foundation and for their costs of remedial work to install the concrete bench. For reasons outlined above, I have found that ERI was not negligent in its excavation work, and that it was not a breach of contract to refuse to complete the remedial work at ERI’s own expense. I nevertheless specifically address the two claims for the benefit of the parties:

(a) Engineering costs of $4,953.75 were incurred by the Owners to investigate the impact of the excavation. Since I have found that it was not ERI’s responsibility to investigate the footings and soils before commencing excavation, and that ERI was entitled to rely on the architectural drawings provided to it, these costs are not properly recoverable from ERI. They are not costs arising from any breach of contract by ERI.

(b) Rectification costs of $12,125 paid to NuSite are also not recoverable, since these costs were not incurred as a result of any breach of contract by ERI. I have found that the concrete bench work was a valid extra for ERI. Evidence supports that ERI’s final cost would have been higher than NuSite’s cost, so the Owners have paid less than they may otherwise have paid.

[77] I accordingly find that ERI is not liable to the Owners for their costs incurred from investigating the structural integrity damage or remedial work required to address it.

ii. Bench preparation labour & materials (basement) - $2,018 (Scott Schedule Item No. 22)

[78] This relates to the concrete bench. The Owners allege that ERI charged $1,900, plus HST, for this work in invoice no. 806, but then separately charged $2,018, plus HST, for the same work in invoice no. 813. Given my finding that ERI was not negligent in its excavation, I need not address the Owners’ argument that these costs were only incurred because of ERI’s negligence. Mr. Ervin’s evidence is that the $2,018 charge is not duplicated in both invoices, but is only included in invoice no. 813. No other evidence was tendered beyond this statement. During cross-examination, ERI’s counsel sought admissions from Mr. Iskander that he had no evidence that the work described in each invoice was actually the same. However, ERI has the onus to prove its supply of services and materials, so it was incumbent on ERI to tender evidence of what work was performed to justify both the $1,900 and $2,018 charges.

[79] I accept the Owners’ position. The work description for the $1,900 charge in invoice no. 806 reasonably relates to preparation work in respect of the concrete bench. It is unclear what other work is reasonably being referenced. ERI has tendered no evidence or explanation regarding what work is being discussed. It is a reasonable inference that it is the concrete bench. The Owners are entitled to a credit for the charge on invoice no. 813, since the earlier amount represents the agreed price for that work based on my findings above regarding contract scope and price.

iii. Removal of existing plumbing in the basement; commencement of digging; building of forms - $400 (Scott Schedule Item No. 20)

[80] This item relates to the concrete bench. The Owners claim the difference between the amount charged by ERI for building the concrete formwork ($1,900, plus HST) and the credit given by NuSite for that work already being done ($1,500, plus HST). Mr. Iskander’s evidence acknowledges that the forms were built, and that ERI had been authorized to build them before ERI’s quote for the work was received. Mr. Ervin’s evidence is that the $1,900 charge was appropriate.

[81] ERI’s initial quote for the total scope of work to prepare forms and complete the concrete bench was $10,495, plus HST, which was comparable to NuSite’s quote of $10,710, plus HST. NuSite’s agreement to credit $1,500 for ERI’s completed work is not evidence that the work is improperly valued at $1,900. In my view, NuSite is not likely to have credited the actual full value of ERI’s work. I find that ERI’s charge for this work is fair. Since I have found that ERI was not negligent in its excavation work, and since Mr. Iskander authorized ERI to perform this work, ERI is entitled to be compensated for it.

iv. Plumbing - $11,700 (Scott Schedule Item No. 26)

[82] The Owners claim the costs paid to a completion contractor, Built Solid, to remove existing plumbing and complete plumbing work at the Dunn Property that was not completed. ERI has the evidentiary onus of establishing that work claimed as being completed and payable was completed. The Owners have the evidentiary onus of establishing that allegedly deficient work was deficient. Given my finding that the Owners breached the contract and that ERI was entitled to terminate, the Owners are not entitled to any credit for completion costs for incomplete work.

[83] Mr. Iskander’s evidence is that ERI charged $4,800, plus HST, for “all plumbing involved at Dunn”, but did not perform any plumbing work on the second or third floors or rough-in plumbing in the basement. In contrast, Mr. Ervin’s evidence is that the amounts charged by ERI reflect the value of work performed for the basement plumbing actually performed. Plumbing work was not completed because of Mr. Iskander changing plans and instructions, including in the basement, “because he did not understand what he was doing.” No evidence was tendered supporting either the extent of basement plumbing work completed or its valuation from which the court can assess if the value of such work was $4,800 as alleged. I give greater weight to Mr. Iskander’s evidence for reasons set out above. In my view, while the Owners do not dispute that some plumbing work was done, ERI has failed to prove its claim for $4,800. In the absence of any evidence on which to assess the extent or value of plumbing work actually completed, I find that ERI is unable to prove its claim for this work.

[84] Mr. Iskander’s evidence is that he was advised by Built Solid that ERI’s work would not pass inspection and, for Built Solid to warrant the work, would need to be removed and replaced in any event. This evidence is hearsay that, in my view, is not necessary and does not meet threshold reliability. No corroborating witness from Built Solid was called, but could have been. I accordingly do not accept that ERI’s completed plumbing work was defective, would not have passed inspection, and had to be removed. The Owners have failed to prove that ERI’s work was deficient, and I accordingly dismiss the set-off claim for amounts paid to Built Solid for this item.

v. Pour new concrete with rebar; install perimeter weeping tile; dimple plastic on walls, etc. - $9,650 (Scott Schedule Item No. 21)

[85] The Owners’ position is that work charged for waterproofing and pouring a reinforced concrete slab floor in the basement was not completed by ERI, but has been charged. The Owners retained Built Solid to complete the work, which was completed at a cost of $8,275, plus HST. ERI claims that these services and materials were supplied, so has the onus of proving that the work was completed.

[86] Mr. Ervin’s evidence on this item is unclear. His affidavit states: “The Plaintiff charged $12,203 for the amount of work actually completed by the plaintiff or its agents, which is substantial. If any of the work was not completed, it was because the Plaintiff was not allowed to complete the work because of the actions of the Defendant[s], including the Breach of Contract.” In my view, Mr. Ervin’s statement, and the related invoice, is not a sufficient answer to the Owners’ challenge. Mr. Ervin’s evidence appears to rely on the description of work performed in invoice no. 813 as evidence of that work being performed, which he states is “substantial” work. That is a hearsay use of the invoice. As set out earlier in these reasons for judgment, the business records exemption in Section 35 of the Evidence Act cannot be relied upon since ERI did not serve the required notice, and I do not accept that ERI’s invoices are necessary or reliable evidence to prove work actually performed. Mr. Ervin’s evidence does not explain what work was performed. Although invoice no. 813 is referenced, Mr. Ervin does not state that all work described in the invoice was performed by ERI.

[87] I accordingly accept Mr. Iskander’s evidence that the waterproofing and concrete slab floor work was not completed by ERI, although is included in the description of the work performed for which the $9,650 is charged. The work described in ERI invoice no. 813 does appear broader than the scope of work outlined in Built Solid’s invoice, although the majority of work appears to overlap. ERI has tendered no evidence on the extent of waterproofing and concrete slab work that was performed and the value of that work. I thereby accept that the amount has been fully invoiced despite the work not being performed and find that the Owners are entitled to a credit for the unperformed work. In the absence of any other evidence, I find that a reasonable value the improperly invoiced incomplete work is the amount paid to Built Solid for the same work.

vi. Various basement plumbing and drain installation - $5,689 (Scott Schedule Item No. 24)

[88] The Owners assert that ERI’s charges for $2,289 and $3,400 relating to basement plumbing work and drain installation should not be payable because the Owners had to remove and redo significant plumbing and drain work to accommodate the concrete bench. Mr. Iskander’s evidence is that the $2,289 charge was for plumbing work that did not pass inspection, and that ERI’s subsequent charge of $3,400 was to correct deficiencies in the original work. No substantiating evidence of that allegation was tendered in evidence.

[89] Mr. Ervin’s evidence is that ERI performed additional work and incurred additional costs because of issues with the drawings, with the result that work had to be repeatedly redone. Plumbing plans in the basement are said to have been changed several times, although no substantiating evidence of such changes was led. No direct response was provided to Mr. Iskander’s evidence that the second charge relates to deficiency rectification work arising from a failed inspection of the prior work billed as the first charge.

[90] The work descriptions for the two charges do not clearly overlap. The $2,289 charge expressly relates to basement plumbing. The $3,400 charge includes only one $45 charge that expressly references the basement. Since the Owners do not dispute that the work for both charges was performed, the Owners bear the onus of proving on a balance of probabilities that the second charge was for deficiency rectification work. I find they have failed to meet that onus.

vii. Disposal fees (bin rental, pick-up & delivery, disposal, etc.) – $5,625 (Scott Schedule Item No. 18)

[91] The Owners claim that disposal fees invoiced by ERI are excessive and unwarranted. Their calculation of the set-off claim of $5,625 is not clear from the evidence.

[92] Mr. Ervin’s evidence is that the parties agreed to use Arizon Disposal Services Ltd. (“Arizon”) for all waste disposal services for the project, and that Abraham Iskander orally hired ERI to “handle the bins and waste disposal”. Agreement is said to have been reached for all disposal expenses to be reimbursed to ERI at cost plus markup, but no evidence was given on the agreed markup. The amount paid by ERI to Arizon was $5,296, plus HST. Mr. Iskander did not deny Mr. Ervin’s evidence, so I find that there was an agreement for ERI to be reimbursed its actual costs plus markup. That does not, however, vitiate the Owners challenge to the quantum of markup being excessive and unwarranted.

[93] ERI has the onus of proving the value of its supply of services and materials. The amount claimed is the total invoice from Arizon plus what appears to be a 30% markup. Mr. Ervin’s evidence is that the markups were to compensate ERI for time spent by Mr. Ervin and ERI’s staff managing waste disposal. There is no evidence of what time commitment was involved by which the court may assess the value of such time. There is no evidence of agreement to a 30% markup for management services, nor is there evidence that such a markup is commercially reasonable.

[94] In my view, ERI has failed to satisfy its burden of establishing the markup is fair and reasonable. I have accepted, however, that there was agreement for ERI to charge a mark up and some time would have been spent managing disposal activities. I accordingly allow only a 10% markup on the disposal fees paid to Arizon, or $529.60, which I view as being commercially reasonable in the circumstances, for a total value of $5,825.60, plus HST. The Owners are entitled to a credit for the difference of $1,050.15, plus HST.

viii. Second Floor Deck with Metal Staircase - $3,320 (Scott Schedule Item No. 1)

[95] The Owners claim a $3,320, plus HST, overcharge in relation to a metal staircase invoiced but not supplied, plus a credit for incomplete work that was not given. Mr. Ervin’s evidence is that the $6,600 invoiced was only for labour, and does not include the supply of a metal staircase, which was never to be provided by ERI. A credit of $1,320 is said to have been applied on ERI’s final invoice.

[96] Invoice no. 806 supports that $1,320 credit was to be given. That invoice shows a total for payments/credits of $61,775. The aggregate of payments/credits showing on all four latest invoices is $99,685. That figure is the same as the total payments received by ERI from the Owners, for which the supporting proof of payment was tendered into evidence by ERI. All of those are payments from the Owners, not credits given by ERI. Although ERI claims the credit was given, ERI has failed to establish that it has been given, and I am satisfied on the evidence before me that does not appear to have been. The Owners are entitled to the credit.

[97] Because ERI’s position is that the metal staircase was not part of its scope, the Owners have the onus of proving that it was within ERI’s scope. The language used in invoice no. 806 is “this new deck is as per drawings with metal staircase” (emphasis added). That language implies the price is inclusive of the metal staircase. Mr. Ervin advised Mr. Iskander by text message on November 12, 2015 that the cost of the metal staircase was obtained and would increase the deck quote by $2,200. That suggests the contrary. Mr. Iskander was cross-examined on that text message and a subsequent text exchange on February 3, 2016 about the cost of the metal staircase. Mr. Iskander maintained his understanding that the price included the metal stairs, and confirmed that the February 2016 text exchange was about clarifying the difference in cost between metal and wood, not confirming the metal staircase was an extra cost.

[98] Other than Mr. Ervin’s text message on November 12, 2015, on which Mr. Ervin did not himself give any evidence, there is no contemporaneous evidence supporting that ERI understood the metal staircase was not included. Given my findings on the base contract scope and price, together with the specific language used in invoice no. 806, I find that the $6,600 quote was intended by the parties to include the metal staircase. That metal staircase was not supplied. The Owners are accordingly entitled to a credit.

[99] There is no direct evidence as to the value of an equivalent metal staircase. Mr. Ervin’s sworn affidavit evidence is that the metal staircase was not part of ERI’s scope and, although Mr. Ervin himself was not cross-examined on either his November 12, 2015 or February 3, 2016 text messages, both text messages support that ERI would have charged $2,000 to $2,500 more for a metal staircase. I accordingly find it reasonable in the circumstances to fix the contract price for the unsupplied metal staircase at $2,200, being the amount stated most contemporaneously to the relevant base contract invoice.

ix. Refurbish staircase to 2nd floor (repair treads, supply & install new oak handrail at top) - $2,500 (Scott Schedule Item No. 6)

[100] The Owners claim that the refurbishment work was not completed in full and Mr. Iskander tendered evidence on certain deficiencies. Built Solid was engaged to replace the staircase at a cost of $4,900, plus HST. The Owners seek to have the amount charged by ERI fully credited.

[101] Mr. Ervin’s evidence is that ERI “completed or partially completed the work listed” and that work completed “was worth at least $2,500.” I find Mr. Ervin’s evidence on this point to lack reliability. The November 11, 2015 version of invoice no. 806 includes a quote for the full refurbishment work of $2,900. The March 16, 2016 version of the invoice includes the same quote, with two $200 credits noted. Based on my findings regarding base contract scope and price, the total refurbishment work was to be performed for $2,500, plus HST. I give greater weight to Mr. Iskander’s evidence that work was not completed, and that the work completed was deficient, particularly since Mr. Ervin’s evidence equivocates on whether the work is completed or partially completed. I also reject Mr. Ervin’s evidence that the partially completed work “was worth at least $2,500” when that was the price for the completed work.

[102] Mr. Ervin’s evidence fails to provide any evidentiary foundation to assess the extent of work actually completed by ERI and the value of that work. Since I have preferred Mr. Iskander’s evidence to that of Mr. Ervin, I accordingly find the Owners are entitled to a full credit of the $2,500 charged.

x. Repair walls on the 1st floor in preparation of painting - $2,520 (Scott Schedule Item No. 7)

[103] Mr. Iskander’s evidence is that ERI’s charge for repairs and paint preparatory work in the amount of $2,280, plus HST, relates to work that was not completed by ERI. The Owners retained Built Solid to complete that work, and an invoice was tendered in evidence totalling $2,520, plus HST. Mr. Ervin’s evidence is that the Owners are incorrect that $2,280 was charged, but rather that invoice no. 806 dated March 16, 2016 clearly indicates only $834 was charged as reflected on page 12 of the invoice. Mr. Ervin asserts that the work completed was worth $834 and that work was left incomplete only as a result of the Owners’ breach of contract.

[104] The $834 charge on page 12 of the invoice is not related to painting preparation work. It relates to work performed at the bottom of basement steps. The challenged charge is on page 16 of the invoice. Mr. Ervin’s evidence appears confused, and I accordingly do not find it reliable. No reliable evidence has been tendered by ERI on what work was performed or the value of such work, which is ERI’s onus to demonstrate. In the circumstances, I prefer Mr. Iskander’s evidence and find that the work was not completed. The Owners are entitled to a credit for the $2,280, plus HST, charged for this work.

xi. Rebuild floor joists beneath bathroom - $1,780 (Scott Schedule Item No. 14)

[105] The dispute on this item relates to rebuilding floor joists beneath the first floor washroom. In particular, Mr. Iskander’s evidence is that ERI cut a large and irregularly shaped notch in joists to accommodate a drain pipe that ERI subsequently installed. Mr. Iskander’s evidence is that ERI never denied it was a deficiency, and characterized a proposed credit of $1,000 as “exaggeration”. Built Solid was retained to replace the joists, which Mr. Iskander argued were compromised, at a cost of $1,780, plus HST. Mr. Ervin does not deny that ERI “cut a very large and irregularly shaped notice in or one or more of the main level floor joists to accommodate a drain pipe”. All that is denied is that the integrity of the joists was compromised by ERI’s work. ERI charged $1,500 for labour related to the work. Mr. Ervin asserts that ERI is not responsible for amounts paid to the rectification contractor.

[106] The Owners have tendered no evidence to support that the structural integrity or performance of the joists was in any way compromised as a result of the notch cut by ERI. Mr. Iskander put Section 9.23.5.2(1) of the Building Code, O Reg 332/12 to Mr. Ervin during cross-examination, which provides as follows:

9.23.5.2. Notching of Framing Members

(1) Floor, roof and ceiling framing members are permitted to be notched provided the notch is located on the top of the member within half the joist depth from the edge of bearing and is not deeper than one-third the joist depth, unless the depth of the member is increased by the size of the notch.

[107] Mr. Ervin was somewhat obstructionist in responding to questions about Building Code compliance with the notched joists by declining to agree they were joists, and suggesting that they may have been cross-members. Nevertheless, the Owners tendered no expert evidence and, having considered the evidence, I lack a sufficient basis on the evidence before me to find that the subject joists are, in fact, joists within the meaning of the relevant Building Code provisions and are captured by Section 9.23.5.2. While ERI does not deny cutting the joists, that is not an admission by ERI that the joists were structurally compromised. Mr. Ervin was asked on cross-examination to confirm agreement to that, but he did not. I cannot find that the joists were defective and needed to be replaced. The Owners are not entitled to this set-off.

xii. Conveyer rental - $1,350 (Scott Schedule Item No. 9)

[108] The Owners claim that ERI has charged for the conveyor rental twice, once in invoice no. 806 and again in invoice no. 813. Mr. Ervin’s evidence disputes any double charge. The $1,350 charge in ERI invoice no. 806 dated March 16, 2016 is asserted to be for labour charges related to a massage room at the Dunn Property. Mr. Ervin states that the conveyor belt rental charge, which is $1,350, is included in ERI invoice no. 813 dated December 30, 2015. He believes the rental was from Stephenson’s Rental Services, and asserts the amount invoiced to be appropriate and reasonable. However, no evidence of ERI’s actual cost of the rental was tendered.

[109] Mr. Ervin’s evidence is confused. His affidavit references page 21 of invoice no. 806, which has nothing to do with the conveyor rental charge challenged. Page 10 of that invoice deals with disposal fees, but notes “includes soil bins and conveyer belt”. I have already addressed the disposal fee charge at issue in this invoice above. The Arizon invoice does not include the conveyor rental, and my calculation of the allowable disposal fee charge also does not account for a conveyor rental. The Owners do not dispute that a conveyor rental charge is properly passed to them, but only dispute the duplication. To the extent that there was any duplicate charge, it has already been removed through my assessment above.

xiii. Miscellaneous purchased items - $953 (Scott Schedule Item No. 15)

[110] Mr. Iskander disputes most of a total $1,206, plus HST, charge for items claimed to be purchased by ERI and delivered to site. $953 of the charge, including a delivery charge of $250, is challenged. Mr. Iskander’s evidence is that these items could only be used for finishing the basement or upper level unit, which were not within ERI’s scope of work, and the delivery charge was never agreed. Mr. Iskander’s evidence is that Mr. Ervin was given an opportunity to pick up the items, but did not do so. Mr. Ervin’s evidence is that ERI did not purchase the items at its own initiative. Rather, the items were “necessary for the construction work” and would have been used had work continued. Mr. Ervin did not, however, give any evidence on why the items were necessary or what purpose they would have served. In the absence of evidence from ERI on the need or purpose for these items, or evidence supporting agreement to a delivery charge, ERI has failed to satisfy its onus regarding supply of these materials. I accept the Owners’ position and grant a credit for them.

xiv. Fill in wall at bottom of basement stairs with cement and rebar - $750 (Scott Schedule Item No. 2)

[111] Mr. Iskander’s evidence is that ERI failed to complete invoiced work at the bottom of basement steps, which is work that the defendant subsequently completed with Built Solid. The Owners seek a credit equal to the amount of $750 paid to Built Solid. Mr. Ervin’s evidence is that the $834 invoiced to the Owners is the value of work that was completed, and that the remainder of work was not completed because of either delays caused by the Owners or the Owners’ breaches of contract.

[112] ERI has the evidentiary onus of proving its supply of these services and materials. Other than Mr. Ervin’s bald statement that the work was done, no evidence supporting completion of the work has been provided. Mr. Ervin acknowledges that the work was not completed in full, but does not explain what has been done and what remained to be complete. The invoice notes “done”. ERI has failed to meet its onus of establishing the value of services and materials actually supplied. The Owners only dispute ERI’s charge to the extent of $750, plus HST. I find that set-off should be granted.

xv. Various labour charged re beam in basement - $750 (Scott Schedule Item No. 25)

[113] Mr. Iskander’s evidence is that ERI did remove an existing wooden beam in the basement and replaced it with a metal beam, but that a structural engineer determined that the beam was improperly supported by lumber rather than non-shrink grout. A proposed remedial solution was made by the engineer. Built Solid was retained by the Owners to complete the work at a cost of $750. In addressing this dispute, Mr. Ervin’s affidavit states as follows at paragraph 68 (emphasis added):

The work undertaken by the Plaintiff was properly completed. Although the Defendant is saying the installation of a new metal structural beam was improperly supported by lumber, but this was the case because the Plaintiff could not finish the job because of the Defendant’s Breach of Contract. The lumber was already there. If the Plaintiff were allowed to continue on the job, and supported the beam with brick and non-shrink grout, the Plaintiff would have invoiced the Defendant additional amounts.

[114] In my view, the emphasized portion is an admission by Mr. Ervin that the metal structural beam was improperly supported by the lumber. Mr. Ervin suggests that ERI’s charges for work did not include supporting the beam, and states ERI would have charged additional amounts for that work. Mr. Ervin references page 5 of invoice no. 813. However, ERI’s description of work in invoice no. 813, in which $2,300 is charged for the beam, is consistent with the scope being to supply and install the beam. That reasonably includes properly supporting the beam upon installation.

[115] ERI’s invoice says the beam work is “done and firm”, suggesting that ERI considered the work complete. No evidence to the contrary was tendered, and I am reinforced in that view by Mr. Ervin’s failure to expressly state that ERI intended to provide further support to the beam. He says only that, “if” ERI had done it, there would have been an extra charge. I accordingly accept the Owners’ evidence that the beam was improperly supported, which is a deficiency in its installation. The Owners are entitled to set-off for rectification of the deficiency. The amount claimed as being paid to Build Solid is reasonable.

xvi. Space heater rental - $600 (Scott Schedule Item No. 19)

[116] The Owners challenge the $600, plus HST, charge for a space heater rental used at the Dunn Property. Mr. Iskander’s evidence is that he obtained a quote for a space heater rental from Stephenson’s Rental Services Inc. (from which ERI asserts the space heater was rented), and was quoted $80 per month, correlating to $320. A credit of $400 is sought, allowing for a 25% markup. ERI tendered no evidence substantiate the rental charges incurred. There is also a discrepancy between the charge of $600 and the description in the invoice, which indicates “updated rental till march 6th-400.00”, implying that ERI’s total rental cost was only $400. On the evidence before me, I accept that the $600 charge is inflated and allow the $200 credit sought.

xvii. Remove and dispose of washer and drier - $550 (Scott Schedule Item No. 16)

[117] Mr. Iskander’s evidence is that a washer and dryer were removed from site by ERI without any prior authorization and without ERI returning them, for which ERI charged $150, plus HST. Mr. Iskander estimates the replacement value of the appliances at $400, plus HST. Mr. Ervin claims that the appliances were moved with consent of the Owners. No evidence of that consent or details of how the consent was given to ERI were provided. Given my earlier determination on the greater weight to be given to Mr. Iskander’s evidence, I accept the Owners’ position that they did not authorize removal of the washer and dryer, so ERI was not entitled to charge for doing so. The Owners’ are also entitled to set-off for the replacement cost of new appliances. No evidence was tendered on the years, makes or models of the removed appliances, but I find the estimate of $200 per unit to be reasonable. I accordingly grant this set-off claim.

xviii. Remove first layer of flooring in study area - $500 (Scott Schedule Item No. 28)

[118] Mr. Iskander’s evidence is that an additional $500, plus HST, charge was unilaterally levied by ERI for work that was part of a $6,800, plus HST, lump sum item. Mr. Ervin’s evidence is that there was no duplicate charge or overcharge, but rather that the two invoice nos. 816 dated December 30, 2015 and January 5, 2016 are identical with the same charge of $7,350, plus HST.

[119] I do not accept Mr. Ervin’s evidence. Both the December 30, 2015 and January 4, 2016 versions of invoice no. 816 include the same scope of work: “lift all hardwood on second floor, take out nails and in the study/patio door room down to the sub floor.” In the December 30, 2015 version of the invoice, that scope is part of a $6,800, plus HST, lump sum price. In the January 4, 2016 version of the invoice, it is part of a $7,350, plus HST, lump sum price. The additional $550 is comprised of a $100 credit, an extra charge of $150 for ceiling work, and a $500 charge to “remove first layer of flooring in study area.” Mr. Ervin provided no explanation on how this new work for $500 was not already included in lifting all hardwood and taking the study room down to the sub floor. In my view, the description of work and lack of clear evidence from ERI supports that the additional $500 charge is a duplicate charge for work already part of the agree scope for which $6,800 had been quoted. This set-off is appropriate.

xix. Meetings with engineer and home owner - $440 (Scott Schedule Item No. 3)

[120] The Owners dispute $440, plus HST, in charges for meetings. Mr. Ervin’s evidence is that he spent at least 8 hours of his time in various meetings with Frank Vanbetlehem and the Owners. His affidavit evidence on this point, at paragraph 43, is vague and unsubstantiated. In my view, ERI has not met its onus of establishing that 8 hours of meetings were attended and that time for attending those meetings is properly chargeable as an extra or separate item.

xx. Rebar - $423 (Scott Schedule Item No. 23)

[121] The Owners challenge a $423, plus HST, charge on invoice no. 813 for rebar as being duplicative of rebar included in a prior lump sum line-item total. Mr. Ervin’s evidence is that the $423 charge was not duplicative, but “was for something else that needed to be completed in the House”. No evidence was tendered as to what that “something else” might be. ERI has not met its onus of proving that any additional services and materials were supplied warranting an extra charge. The Owners are entitled to a credit for this item.

xxi. Remove and replace quarter round - $420 (Scott Schedule Item No. 10)

[122] The Owners challenge a $420, plus HST, charge on invoice no. 806 for quarter round as being duplicative of a prior lump sum line-item total. Mr. Ervin’s evidence is that the $420 charge is mischaracterized as being charged separately, when it is not a separate charge in ERI’s invoice no. 806 dated March 16, 2016 and has not been double-charged as alleged. Page 17 of the January 1, 2016 version of invoice no. 806 clearly indicates “remove and replace 1/4 round” as part of the lump-sum $2,760, plus HST, price for various work. The subsequent March 16, 2016 version of the invoice, on page 24, adds “new 1/4 round is needed, oak and painted-420.00”. The lump sum price has increased to $3,730. The $970 difference is the $420 noted, plus $550 for “levelling and spray mold”.

[123] In my view, Mr. Ervin’s statement that “The charge of $420 was not included in the final invoice as an item broken out and charged separately” is inconsistent with the plain reading and calculation of ERI’s invoice. The change in lump sum price or need for new quarter round at an increased price has not been explained by ERI, nor has ERI tendered evidence on the supply and installation of quarter round from which the court might reasonably assess the value of services and materials provided. The Owners are accordingly entitled to a credit for the charge.

xxii. Break out chimney; install ductwork to connect stove, vent, dryer, and bathroom fan; run a flex line in the chimney; install a chimney cap; reinstall interior and insulation - $410 (Scott Schedule Item No. 8)

[124] Mr. Iskander’s evidence is that the work invoiced was only partially completed, and that a flex line and cap were never installed. A 50% credit is sought. Mr. Ervin’s evidence is that the $820 amount invoiced was for completed ductwork, vent, dryer and bathroom fan connections. He acknowledges that a flex line and cap were not installed, but notes the Owners were not charged for those items.

[125] The $820 charge in invoice no. 806 clearly includes “run a flex line in the chimney, cap at top, put back interior and insulate” as part of the scope. It is marked “done”. Mr. Ervin admits that the flex line and cap were not completed. I have no evidence from ERI on the valuation of its services and materials actually supplied beyond the bald assertion of Mr. Ervin that $820 is appropriate and reasonable. I do not agree that the Owners should pay the full lump sum price for a collection of services where some of those services have admittedly not been supplied. The incomplete work appears to be approximately one-half of the total work, so I accept the Owners’ claim for a 50% credit.

xxiii. Putting the pipe in the wall of the doorway - $400 (Scott Schedule Item No. 11)

[126] The Owners assert that they have been charged twice for the same work of removing and rebuilding a section of wall to accommodate a drain pipe to the second floor. Mr. Iskander’s evidence is that only one section of wall was ever removed and rebuilt. Mr. Ervin’s evidence is that two $400 charges on pages 20 and 28 of the invoice are for different items, and are not duplicate charges. That is not the challenged duplication. Mr. Iskander’s evidence identifies the duplication as being on page 28 ($400) and page 30 ($455). Having received the Owners’ trial affidavit, ERI did not tender any reply evidence to explain the second charge. Based on the descriptions of work and Mr. Iskander’s undisputed evidence that only one wall was removed and rebuilt, I find that ERI has double-charged for the same work. A credit of the first charge as sought by the Owners is appropriate.

xxiv. Baseboards, trim, and casings - $324 (Scott Schedule Item No. 4)

[127] Mr. Iskander’s evidence is that ERI’s baseboard, trim and casings work was incomplete and deficient. ERI does not dispute that the work is incomplete. Mr. Ervin’s evidence is that the $324 invoiced to the Owners reflects the value of work actually completed. Notice of the deficiencies was given on February 13, 2016, in response to which Mr. Ervin took the position that the work was incomplete. I am satisfied from the photographs tendered by Mr. Iskander that ERI’s work was deficient. Notwithstanding that I have found ERI was entitled to terminate the contract, the Owners are not required to pay for deficient work. ERI had an opportunity to remedy the deficiencies, but did not do so. The credit sought is appropriate.

xxv. Open up pine box in ceiling for discovery - $300 (Scott Schedule Item No. 27)

[128] Mr. Iskander’s affidavit evidence confirms that this Scott Schedule item could not be located in the invoices, but asserts the work was not completed. Mr. Ervin’s evidence is that the work was performed, but was part of a lump sum of $7,350 charged on invoice no. 816. It was not a separate charge. Both Mr. Ervin and Mr. Iskander rely on bald assertions that the work was done or not done, respectively. While ERI has the onus of establishing the supply of services and materials, and I am not prepared to accept Mr. Ervin’s bald assertion that the work was done, I have no evidence from either side on what this work entailed from which to assess a reasonable value. I cannot accept the Owners’ unsubstantiated estimate of $300, which is not reflected in any evidence. I accordingly find that ERI has not established this work was performed, but cannot determine any justifiable credit to be granted to the Owners in respect of it.

xxvi. Drain for tub - $250 (Scott Schedule Item No. 12)

[129] Mr. Iskander’s evidence is that invoice no. 815 was issued as a new quote for all plumbing, but ERI nevertheless still charged $250 for a supply and installation of a bathtub and drain on invoice no. 806. Mr. Ervin’s evidence is simply that the charges in ERI invoice nos. 806 and 815 are not duplicate charges, pointing only to page 13 of invoice no. 806 and generally to invoice no. 815 for explanation. Contrary to Mr. Ervin’s apparent view, I do not agree that the invoices speak for themselves in clarifying ERI’s position. The scope of the extras added to invoice no. 806 seems clearly within the description in invoice no. 815. ERI has tendered no evidence on why it would not be. I accordingly accept the defendant’s evidence that the $250 charge is an improper charge for scope already quoted in invoice no. 815.

xxvii. Drains and shut-offs, p-trap - $35 (Scott Schedule Item No. 13)

[130] The Owners’ challenge is the same as the above, namely that ERI has charged $35, plus HST, for items that were included in the new invoice no. 815. Mr. Ervin’s evidence is that this is not a duplicate charge, and that the Owners were only charged in invoice no. 815. Invoice no. 806, at page 36, clearly charges $35 for “drains n shut offs, x4 shut offs, x1 p trap”. These are all items properly captured by invoice no. 815. ERI has tendered no evidence on why it would not be. I accordingly accept the Owners’ evidence that the $35 charge is an improper charge for scope already covered in invoice no. 815

xxviii. Moving toilet bowls around - $150 (Scott Schedule Item No. 17)

[131] Mr. Iskander’s evidence is that the Owners did not authorize ERI to move and dispose of toilets, or agree to any charge for it. Mr. Ervin’s evidence is that the toilets were disposed of by ERI with consent and authorization of the Owners and, in any event, that the toilets were damaged and needed to be removed and replaced. No substantiating evidence of the consent or authorization to remove the toilets, alleged damage to them, or need to replace them was provided. I have placed greater reliability on the evidence of Mr. Iskander, so find that there was no consent or authorization from the Owners. This charge was improper and, in any event, is unsubstantiated.

xxix. Move electric stove to basement - $50 (Scott Schedule Item No. 5)

[132] The Owners challenge ERI’s charge for moving a stove. Mr. Iskander’s evidence is that third-party movers moved the stove. Mr. Ervin’s evidence is only that ERI “caused the electrician to move the electric stove” and that the amount invoiced was “appropriate and reasonable”. The contractual arrangement, as I have found it, was not time and materials. There is no evidence of agreement to this charge. It is not properly chargeable.

VI. Conclusion

[133] Based on the foregoing, and taking into account my determinations on the Owners’ set-offs and other defences, which limit the value of ERI’s lien pursuant to Section 17 of the Construction Lien Act, I calculate that ERI has been overpaid and is thereby not entitled to a lien. The Owners are entitled to a nominal damages award of $738.20, representing the extent of overpayment. That award is calculated as follows,

Allowed ERI Invoice Amounts

Agreed total amount of ERI invoices $ 134,031.21

Less: Invoiced work not proven

Plumbing (Item No. 26) $ 4,800.00
Waterproofing/Concrete Slab (Item No. 21) 8,275.00
Refurbished Stairs (Item No. 6) 2,500.00
Paint Preparatory Work (Item No. 7) 2,280.00
Misc. Purchased Items (Item No. 15) 953.00
Bottom of Basement Stairs (Item No. 2) 750.00
Rebar (Item No. 23) 423.00
19,981.00

hst 2,597.53

$ 22,578.53 - 22,578.53.

Less: Incomplete work improperly charged

Metal Staircase (Item No. 1) $ 2,200.00
Flex Line/Cap (Item No. 8) 410.00
2,610.00

hst 339.30

2,949.30 - 2,949.30

Less: Improper duplicate charges

Bench Preparation (Item No. 22) $ 2,018.00
Study Flooring (Item No. 28) 500.00
Quarter Round (Item No. 10) 420.00
Wall Pipe (Item No. 11) 400.00
Drain for Tub (Item No. 12) 250.00
Drains, Shut-offs, P-trap (Item No. 13) 35.00
3,623.00

hst 470.99

4,093.99 - 4,093.99

Total Allowed ERI Invoice Amounts $ 104,409.39

Allowed Set-Offs

Set-off for deficiencies

Basement Metal Beam (Item No. 25) $ 750.00
Baseboards, Trims, Casings (Item No. 4) 324.00
1,074.00

hst 139.62

1,213.62 $ 1,213.62

Set-off for overcharges and related damages

Disposal Fees (Item No. 18) $ 1,050.15
Outstanding Deck Credit (Item No. 1) 1,320.00
Space Heater Rental (Item No. 19) 200.00
Removal of Washer/Dryer (Item No. 16) 550.00
Meetings (Item No. 3) 440.00
Moving Toilet Bowls (Item No. 17) 150.00
Move Electric Stove (Item No. 5) 50.00
3,760.15

hst 488,82

4,248.97 4,248.97

Total Set-Offs $ 5,462.59

Reconciliation

Allowed ERI Invoice Amounts $ 104,409.39

Less: Payments received - 99,685.00
Less: Allowed set-offs - 5,462.59

Total Overpayment by Defendants $ 738.20

[134] I accordingly find that ERI has failed to prove entitlement to a lien under the Construction Lien Act. The Owners have proven that they are entitled to judgment in the amount of $738.20, plus pre-judgment interest pursuant to the Courts of Justice Act, which shall be payable by ERI. The Owners are also entitled to return of the security posted into court to vacate ERI’s lien.

VII. Costs

[135] The parties have filed Bills of Costs. I encouraged them to attempt to resolve the issue of costs between themselves. If the parties are unable to resolve costs, then brief written submissions of no more than four pages, excluding any offers to settle or case law, are to be provided by both sides by October 9, 2019. Each side shall have a right of reply to the submissions received not to exceed two pages and to be provided by October 18, 2019. Cost submissions should be filed directly with my Assistant Trial Coordinator.

VIII. Final Report

[136] The Construction Lien Act requires that the results of a reference be embodied in a report in the prescribed form. The parties shall attend before me on November 14, 2019 at 10:00 a.m. to finalize the report, unless the parties are able to finalize the report on consent and either costs are agreed or such consent is reached following the release of my costs endorsement. In either case, the parties may either by appear before me in ex parte court with a jointly approved draft report and consent or file a jointly approved draft report and consent for my review and signature. If the fixed date is not convenient to the parties, then the parties shall provide at lest five (5) common available dates to my Assistant Trial Coordinator for a new date to be fixed.

MASTER TODD ROBINSON

Released: September 20, 2019

COURT FILE NO.: CV-16-552087

DATE: 2019 09 20

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

ERVIN’S RENOVATIONS INC.

Plaintiff (Defendant by counterclaim)

• and -

NICOLE MARIE ISKANDER and CHRISTOPHER ISKANDER

Defendants (Plaintiffs by counterclaim)

REASONS FOR JUDGMENT

Master Todd Robinson

Released: September 20, 2019