Court File and Parties

COURT FILE NO.: CV-18-674 DATE: 2019/11/18

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Real Time Systems Inc., Plaintiff AND: Priestap Inc., Warren Priestap and Mary Priestap, Defendants

BEFORE: Justice G.E. Taylor

COUNSEL: Michael van Bodegom, Counsel for the Plaintiff Eric Grigg, Counsel for the Defendants

HEARD: May 23, 2019 and October 1, 2019

ENDORSEMENT

[1] This is a motion by the defendants for partial summary judgment essentially dismissing the plaintiff’s action. The corporate defendant will then proceed to trial on the claim for set-off and the counterclaim. I will refer to the defendants collectively as “Priestap”.

[2] This action arises out of the construction of a water treatment plant in North Bay, Ontario. Priestap was a subcontractor to the general contractor, and the plaintiff was a subcontractor to Priestap. The plaintiff’s claim is for the balance owing on its contract price plus extras to the contract. The plaintiff seeks judgment in the amount of $128,883. Priestap seeks judgment on the counterclaim in the amount of $101,865. The plaintiff claims that it incurred extra expenses including extra time because of deficiencies in the subcontract specifications and changes to the scope of work required by the owner. Priestap claims that the plaintiff failed to comply with the time requirements as specified in the subcontract which resulted in additional expenses and a loss of profit.

[3] Priestap is an electrical contractor with expertise in wastewater treatment systems. The plaintiff specializes in developing control and instrumentation systems for water treatment plants. Priestap was awarded the contract for the process control system and the electrical system for the water treatment plant being constructed by the City of North Bay. Priestap then contracted with the plaintiff to supply the process controls and related equipment and software for the water treatment plant.

[4] The plaintiff says that it was not provided with an accurate schedule for completion of its work. The plaintiff also says that the documentation on which it based its contract price did not accurately describe what was required for the project. One of the steps in the work required to be done by the plaintiff was a Factory Acceptance Test (“FAT”) of the software developed by it. The purpose of the FAT was for the City of North Bay to review and approve the software developed by the plaintiff prior to installation on site. According to the plaintiff, the City of North Bay approved the FAT but when it attempted to install the system on site it discovered that conditions were significantly different than at the time of the FAT thereby resulting in significant delays and extra costs to the plaintiff.

[5] Priestap disputes that there was any problem with the contract documentation. Priestap says that all delays were as a result of the plaintiff failing to comply with the timelines established for the project. As a result of the plaintiff’s delays, Priestap suffered additional costs which form the basis of the claim for set-off and the counterclaim.

[6] In my view, the outcome of this litigation will be determined by which of the positions of the parties is found to be correct. What Priestap wants is to have the plaintiff’s claims dismissed but then be given the opportunity to continue with the action to seek to prove that it suffered losses as a result of the plaintiff’s performance. The same factual findings will be required. If successful on this motion but unsuccessful at trial, it will not face any exposure to a damage award in favour of the plaintiff.

[7] In my opinion, there are significant factual issues that require determination. The resolution of those factual issues will determine which party is successful. It is not appropriate, in my view, for the plaintiff’s entitlement to judgment to be decided on a motion for summary judgment leaving Priestap’s entitlement to judgment to be resolved at trial.

[8] For these reasons, Priestap’s motion for partial summary judgment dismissing the plaintiff’s claim is dismissed.

[9] If the parties are unable to resolve the issue of costs they may make written submissions. Cost submissions on behalf of the plaintiff are to be delivered to my office within 14 days of the release of this Endorsement. Cost submissions of Priestap are to be delivered to my office within 28 days of the release of this Endorsement. The written submissions are not to exceed three pages in length exclusive of a Bill of Costs and Costs Outline. Copies of the written submissions are to be submitted to my attention at Kitchener.Superior.Court@ontario.ca

G.E. Taylor J

Date: November 18, 2019