COURT FILE NO.: CV-16-553425

DATE: 2020 05 01

ONTARIO

SUPERIOR COURT OF JUSTICE

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

BETWEEN:

OSMI HOMES INC.

H. Mandel, for the plaintiff

Plaintiff (Defendant by counterclaim)

• and -

ANIL KUMAR a.k.a. ANIL KUMAR KINGRANI

J.S.G. MacDonald, for the defendant

Defendant (Plaintiff by counterclaim)

HEARD: August 6, 7, 8, 9 and 14, 2019

REASONS FOR JUDGMENT

Master Todd Robinson

I. Introduction........................................................................................................................ 2

II. Background........................................................................................................................ 3

a. Pre-construction relationship........................................................................................ 3

b. Construction at 132 Church Avenue, North York......................................................... 3

c. Construction contract with Osmi Homes...................................................................... 4

d. Construction at 492 Wellington Crescent, Oakville...................................................... 6

e. Reference history.......................................................................................................... 6

III. Issues................................................................................................................................... 6

IV. Position of the Parties........................................................................................................ 7

V. Witnesses............................................................................................................................. 7

a. Hitesh Jhaveri, Osmi Homes........................................................................................ 9

b. Anil Kumar Kingrani.................................................................................................. 10

c. Inconsistent evidence of Hitesh Jhaveri and Anil Kumar Kingrani............................ 11

d. Riaz Ahmed, Frinz Electrical Services........................................................................ 11

e. Austin Green, Future World Enterprise Co................................................................ 12

f. Gholamreza Mehrfard, 1911079 Ontario Inc............................................................. 12

g. Bo Liu, Shelltech Global Inc....................................................................................... 12

h. Rajesh Kumar Kingrani.............................................................................................. 12

i. Deepak Khatri............................................................................................................ 12

j. Vatsal Khamar............................................................................................................ 13

VI. Analysis............................................................................................................................. 13

a. Scope of base contract work....................................................................................... 13

b. Extras.......................................................................................................................... 22

c. Amount owing to Osmi Homes before payments and set-offs..................................... 37

d. Payment terms and manner of payment..................................................................... 39

e. Payments and loan credits.......................................................................................... 45

f. Deficiencies and incomplete work.............................................................................. 53

g. Timeliness of the lien................................................................................................... 67

h. Breach of contract...................................................................................................... 67

i. Pre-judgment interest.................................................................................................. 68

VII. Conclusion........................................................................................................................ 68

VIII. Costs.................................................................................................................................. 68

IX. Report............................................................................................................................... 69

I. Introduction

[1] Osmi Homes Inc. (“Osmi Homes”) was contracted by Anil Kumar Kingrani to demolish the existing house and construct a new residence at 132 Church Avenue, North York (the “Church Project”). Mr. Kingrani is the registered owner of the premises. Work proceeded over the course of just over one year between April 2015 and April 2016, when work on the Church Project ceased. Osmi Homes claims that it completed its work and asserts that Mr. Kingrani breached the contract by failing to pay amounts due and owing. Mr. Kingrani denies the allegations of non-payment and claims that Osmi Homes breached and abandoned the contract.

[2] Following cessation of work, Osmi Homes registered a claim for lien for $222,304.50 on account of unpaid services and materials. The lien was perfected by issuing this action and registering a certificate of action against title to the premises. Osmi Homes has since re-calculated its claim to the increased amount of $223,915.83 after accounting for a missed credit and an uncashed payment. Mr. Kingrani disputes the claim, alleging he has overpaid Osmi Homes and counterclaiming for $53,722.73 in costs to correct deficiencies and complete the Church Project. Although additional general damages and damages for an exaggerated lien are pleaded, Mr. Kingrani did not lead evidence or argument on them at trial.

[3] For the reasons set out below, I have determined that Mr. Kingrani breached the contract for non-payment and that Osmi Homes is entitled to a lien in the amount of $86,244.38 and judgment for the same amount, plus pre-judgment interest.

II. Background

a. Pre-construction relationship

[4] Osmi Homes is a construction company operated by Hitesh Jhaveri. Prior to the contract for the Church Project, Osmi Homes had been in business for approximately four years, primarily constructing low-rise infill housing. Prior to emigrating to Canada, Mr. Jhaveri had operated another construction company in India.

[5] Mr. Kingrani and Mr. Jhaveri were introduced to one another sometime in 2012. After that time, they had an ongoing relationship, although the characterization of that relationship is disputed. Mr. Kingrani’s evidence is that he viewed Mr. Jhaveri as his friend. Mr. Jhaveri’s evidence is that they were only friendly business acquaintances.

[6] Mr. Kingrani is a private lender. Over the years, through a numbered company, Mr. Kingrani loaned substantial sums of money to Mr. Jhaveri. It is undisputed that, when the construction contract for the Church Project was signed, Mr. Jhaveri still owed a large sum in loan debts. Despite the relevance of those outstanding loans to payment accounting on the Church Project, limited evidence was tendered on them. Mr. Jhaveri’s evidence is that $221,000 in loans remained owing. One signed promissory note for $70,000 was tendered in evidence, as well as two loan cheques. Two other loans, each in the amount of $15,000, were made to Niketa Wadia, who appears to be Mr. Jhaveri’s spouse. No documentary evidence on these two loans was tendered at trial, but the parties agree that both loan amounts were debts payable by or properly attributable to Mr. Jhaveri.

b. Construction at 132 Church Avenue, North York

[7] In early 2014, Mr. Kingrani purchased the subject property. His intention was to tear down the existing house, build a new house, and then sell the property. Mr. Kingrani initially negotiated a contract with a different contractor, Metro Developers Group, for demolition of the existing structure and construction of a new 3,600 sq. ft. house for a contract price of $300,000 plus HST. That correlates to a price of approximately $95 per sq. ft. including HST.

[8] Mr. Jhaveri assisted Mr. Kingrani during contract negotiations and planning with Metro Developers Group, although there is a dispute regarding the extent of that assistance. Mr. Kingrani suggests that Mr. Jhaveri had significant involvement. Mr. Jhaveri acknowledges only that he assisted Mr. Kingrani in navigating the requirements of the City of Toronto’s Planning Department and Building Department. Of some significance in this litigation is Mr. Kingrani’s evidence that Mr. Jhaveri told him that Metro Developers Group’s price of $95 per sq. ft. was only for a shell with interior work up to drywalling, and that Mr. Jhaveri could complete construction with the house almost entirely finished, but for a few exceptions, at a price of $125 per sq. ft. Mr. Jhaveri flatly denies making those statements.

[9] Having been unsatisfied with a prior designer for the house, Mr. Kingrani engaged Chuan Liang Architects to redesign the new house. Based on the City-approved permit drawings, those new drawings were prepared in August 2014, and called for a larger 4,026 sq. ft. house. According to notations in the drawings, the permit versions were prepared in December 2014 and submitted to the City in January 2015. Revisions were thereafter made to address City comments, and a building permit was ultimately obtained in February or March 2015.

[10] The City-approved permit drawings also include a survey of the premises completed on June 27, 2014 and a site grading plan completed on November 18, 2014, both by Mandarin Surveyors Limited (“Mandarin Surveyors”). During Mr. Kingrani’s cross-examination, this site grading plan was mistakenly identified by examining counsel as having been prepared on January 19, 2015, which is the date of the City’s stamp for receipt of the survey. Mr. Kingrani testified that he did not recall whether he or Mr. Jhaveri retained Mandarin Surveyors, but that he did not know them.

[11] Although the date is unclear from the evidence, Metro Developers Group advised Mr. Kingrani that there would need to be an adjustment to the contract price after the new designs had been prepared, and that any issues created by conflicts between the new design and the design previously submitted to the City of Toronto would be at Mr. Kingrani’s risk. What happened between Mr. Kingrani and Metro Developers Group is not clear from the evidence, but it is undisputed that a construction contract with Metro Developers Group was not pursued and that an agreement was reached to have Osmi Homes complete the construction.

c. Construction contract with Osmi Homes

[12] Mr. Kingrani’s evidence is that, shortly after obtaining the building permit, Mr. Jhaveri asked him about doing the construction at the Church Project. Mr. Jhaveri is said to have reiterated the representation that Osmi Homes would complete a larger scope of work than Metro Developers Group. Mr. Jhaveri’s contrary evidence is that it was Mr. Kingrani who approached him about performing the construction.

[13] Before the Church Project, Mr. Jhaveri had never built a house for someone else. All of Osmi Homes’ prior jobs had been construction for Mr. Jhaveri’s own business endeavours. In Mr. Jhaveri’s first affidavit, he asserts that he “knew nothing about change orders or confirming all of my actions in writing.” The nature and extent of Mr. Jhaveri’s construction experience in India before he emigrated to Canada was not explored in any detail at trial.

[14] Mr. Jhaveri drafted the construction contract for the Church Project. In his first affidavit, he describes that contract as his “first ever construction contract based on a sample that [he] found” and further states that he did not “review with a lawyer what should go into a construction contract.” In his second affidavit, Mr. Jhaveri suggests that, in March 2015, Mr. Kingrani gave him a quotation received from Alcan Construction & Management (“Alcan”) for construction of the Church Project. Mr. Jhaveri’s affidavit states that, in preparing the draft contract, he “mimicked” Alcan’s exclusions of items for Mr. Kingrani to complete on his own. That quotation was not produced until shortly before trial, and is the subject matter of Mr. Jhaveri’s third affidavit, which outlines how and when it was located. Mr. Kingrani denies having provided the Alcan quotation to Mr. Jhaveri.

[15] The parties agreed on a fixed contract price for Osmi Homes’ work in the amount of $503,250 plus HST, for a total of $568,672.50. Calculation of that contract price is expressly included in Section F of the contract as 4,026 sq. ft. at a rate of $125 per sq. ft., plus HST. Mr. Jhaveri’s evidence is that he “costed the price of [Osmi Homes’] scope of work that it was to undertake to do at $125 per square foot plus HST, based on the instructions of Anil Kumar.” The contract scope of work is a seriously disputed issue. Nevertheless, neither Mr. Jhaveri’s affidavit evidence nor testimony clarified what he meant by “based on the instructions of Anil Kumar.” Mr. Jhaveri gave no evidence on what meetings or discussions took place with Mr. Kingrani leading to the $125 per sq. ft. price, although there is evidence in Mr. Jhaveri’s second affidavit denying that the $125 per sq. ft. amount included all work “to the point that [Mr. Kingrani] did not have to finish much of the house after [Osmi Homes’] contract’s construction was completed.”

[16] Contractual payment terms are in conflict. Section G of the contract provides for payment in eight equal draws, each in the amount of $71,084.06. A separate schedule entitled “Progress Payment” provides for unequal amounts to be paid upon completion of various construction stages. In Mr. Kingrani’s affidavit, he states that Osmi Homes drafted the “Progress Payment” schedule and that they did not discuss the contradiction with Section G of the contract. Mr. Jhaveri testified that the “Progress Payment” schedule was prepared at Mr. Kingrani’s request following a discussion in which Mr. Kingrani said it would help him for Osmi Homes to invoice as work was completed. In either case, the schedule was prepared, agreed and initialled by the parties.

[17] Section E of the contract provides that construction was to be completed within six months, by September 30, 2015. Mr. Kingrani’s uncontested evidence is that there was no negotiation regarding this term, since the duration had been the same in the contract with Metro Developers Group and that Mr. Jhaveri agreed he could finish construction within the same timeline. As on many construction projects, delay was an issue on the Church Project, but no damages for delay were pursued by Mr. Kingrani at trial.

[18] Preliminary construction work appears to have commenced in March 2015, and the contract was signed on April 1, 2015. Demolition and construction work thereafter began. Mr. Kingrani testified that he was on site during the construction roughly twice per week on average, with less or more attendances depending on construction activity. I am satisfied from Mr. Kingrani’s evidence that he was regularly present throughout the course of construction.

[19] Between April 2015 and March 2016, Mr. Kingrani made various payments to Osmi Homes and credits for Mr. Jhaveri’s loan debts were agreed in lieu of payments. Notwithstanding the payment provisions of the contract, payments were not made in accordance with either Section G or the “Progress Payment” schedule, nor were payments made with any relationship to stages of construction being completed. Although the actual date of Osmi Homes’ last supply is disputed, Osmi Homes claims it completed its work on April 9, 2016. Osmi Homes’ final invoices and a credit memo for certain unfinished work were rendered on April 12, 2016, two days prior to registration of Osmi Homes’ claim for lien.

d. Construction at 492 Wellington Crescent, Oakville

[20] Shortly after purchasing the subject premises, Mr. Kingrani also purchased a property at 492 Wellington Crescent, Oakville. He had the same intent as with the Church Project, namely to demolish the existing house, construct a new house, and then sell the property. Osmi Homes was contracted by Mr. Kingrani to construct a new 3,028 sq. ft. house on that property, for an agreed contract price of $378,500 plus HST (the “Wellington Project”). The contract regarding the Wellington Project was signed on April 21, 2015, and is the subject matter of separate litigation.

[21] By agreement of the parties, payments and loan credits during the course of construction on both the Church Project and the Wellington Projects were allocated between the two projects. Although referenced during the course of trial for other purposes, the Wellington Project is relevant to this litigation with respect to payment allocation.

e. Reference history

[22] Following the close of pleadings, Osmi Homes’ lien was vacated by order of Master Muir dated February 22, 2017 upon the posting of $272,304.50 in security for the lien and costs with the Accountant of the Superior Court of Justice. That security remains in court.

[23] A judgment of reference was signed by Justice Dow on December 27, 2016, referring the action to be determined by a construction lien master. An order for trial was thereafter signed by Master Albert on July 11, 2017. The action came on for two hearings for directions before Master Albert on December 18, 2017 and June 26, 2018, at which various procedural orders were made to advance the litigation and ready it for trial. Following Master Albert’s retirement, I assumed the reference pursuant to Rule 54.10 of the Rules of Civil Procedure, RRO 1990, Reg 194 and provided final directions to the parties prior to trial.

III. Issues

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

(a) What was the contract scope of work that Osmi Homes was required to perform? In particular, are extras claimed by Osmi Homes part of its base contract scope of work?

(b) Are extras claimed by Osmi Homes compensable extras to the contract and, if so, in what amount?

(c) What is the total value of services and materials supplied by Osmi Homes before accounting for payments and set-offs?

(d) What is the total amount of all payments made and loan credits given on account of the Church Project?

(e) Was any of Osmi Homes’ work incomplete or deficient and, if so, is Osmi Homes liable to compensate Mr. Kingrani for his costs of completion or rectification?

(f) Is Osmi Homes’ lien timely?

(g) Who breached the contract?

IV. Position of the Parties

[25] Osmi Homes’ position is that it completed all work required under the contract, except for the supply and installation of an air conditioning unit and installation of toilets, for which a credit was issued. Osmi Homes denies that there were any deficiencies in its work, and claims it was given no notice of deficiencies and no opportunity to remedy them. Osmi Homes claims that the contract expressly sets out the full extent of the base contract scope of work, that Mr. Kingrani fully understood that scope did not include the extras charged by Osmi Homes, and that those extras were discussed with and agreed by Mr. Kingrani before the work was performed. According to Osmi Homes, Mr. Kingrani was, in any event, aware that all extra work was proceeding and acquiesced in the work being performed. Mr. Kingrani’s position that all extras were part of the base contract price is argued to be an attempt to take advantage of agreed extras not being committed to writing and inconsistent with Mr. Kingrani overpaying the contract. Mr. Kingrani is said to have received all of Osmi Homes’ invoices and project accounting on a monthly basis, yet failed to object to charged extras or make payment of the amounts owing.

[26] Mr. Kingrani’s position is that Osmi Homes took advantage of his lack of experience in construction. Mr. Kingrani does not accept Osmi Homes’ limited and literal reading of the contract scope of work. According to Mr. Kingrani, the reason he contracted with Osmi Homes was in reliance on Mr. Jhaveri’s representation that he would construct the house to a nearly completed state with all features identified in the permit drawings, with only a few exceptions, at a price of $125 per sq. ft. Mr. Kingrani argues that there was otherwise no basis to walk away from his prior contract with Metro Developers Group at a price of $95 per sq. ft. Mr. Kingrani argues it was agreed and reasonably understood that Osmi Homes’ contract included an increased scope of work in return for the higher price per sq. ft., but Osmi Homes improperly invoiced base contract work as extras. Mr. Kingrani argues he did not authorize any work to be charged as extras, that there were no discussions on price before allegedly extra work was performed, and that monthly invoices and accounting were not provided to him by Osmi Homes as alleged. He further argues that work was incomplete and deficient and that Osmi Homes abandoned the job, since Osmi Homes had been overpaid and there was thereby no justification for not completing all work.

V. Witnesses

[27] Proposed witnesses were identified by both sides at the second hearing for directions before Master Albert. At trial, with the exception of a few introductory questions and brief examinations-in-chief regarding documents for which authenticity was challenged, all evidence-in-chief was led by affidavit. The substantive viva voce evidence at trial was through cross-examination of witnesses, with some re-examination.

[28] Osmi Homes called five witnesses, as follows:

(a) Hitesh Jhaveri, the president of Osmi Homes, who was Osmi Homes’ primary witness;

(b) Riaz Ahmed, the owner of Frinz Electrical Services (“Frinz”), which was Osmi Homes’ electrical subcontractor;

(c) Austin Green, the president Future World Enterprise Co. (“Future World”), which was Osmi Homes’ subcontractor responsible for all framing work and installation of a cold cellar door;

(d) Gholamreza Mehrfard, the president of 1911079 Ontario Inc., which was Osmi Homes’ concrete supplier; and

(e) Bo Liu, president of Shelltech Global Inc. (“Shelltech”), which was Osmi Homes’ smart wiring subcontractor. On consent, Mr. Liu was not examined until after examination of all defence witnesses, and Mr. Kingrani was thereafter recalled for cross-examination on Shelltech’s work and other HVAC-related issues deferred by agreement of the parties.

[29] Osmi Homes also tendered the affidavit of Clement Morgan, the owner of Oxford Heating and Cooling, which was Osmi Homes’ subcontractor responsible for installation of the furnace and a heat-recovery ventilator (HRV) unit. However, despite summons, Mr. Morgan, failed to attend trial for examination on either August 8 or 9, 2019. No adjournment was sought, and Osmi Homes withdrew Mr. Morgan’s affidavit. I have accordingly not considered it.

[30] Mr. Kingrani called four witnesses, as follows:

(a) Mr. Kingrani himself; and

(b) three individuals, each of whom gave evidence regarding payments made to Osmi Homes on behalf of Mr. Kingrani, namely:

(i) Rajesh Kumar Kingrani, who is Mr. Kingrani’s brother;

(ii) Deepak Khatri; and

(iii) Vatsal Khamar (whose evidence was given via videoconference on consent of the parties).

[31] A fifth witness, Urmilaben Hazariwala, attended trial, but lacked sufficient understanding of English to be affirmed and accordingly could not give evidence without the assistance of an interpreter. No interpreter had been arranged, and Mr. Kingrani ultimately elected not to call her as a witness. Mr. Kingrani also tendered a short affidavit from Navin Patel, another individual who made payments to Osmi Homes on behalf of Mr. Kingrani. Mr. Patel was ultimately not called by Mr. Kingrani. At the conclusion of evidence, counsel for Osmi Homes sought confirmation regarding the treatment to be given to the affidavit evidence of Ms. Hazariwala and Mr. Patel. Since neither of them were presented for cross-examination, it was acknowledged and agreed by Mr. Kingrani’s counsel that their respective affidavits of evidence-in-chief should not be relied upon for determination of trial issues. I have accordingly not considered either affidavit.

[32] Witness credibility and reliability are significant in this action. Most notably, evidence from the primary two witnesses, Mr. Jhaveri and Mr. Kingrani, was regularly in direct conflict on key issues, such as the nature and subject matter of their verbal discussions, timing of receipt of Osmi Homes’ invoices, and allocation of payments and loan credits between the Church Project and the Wellington Project. In many cases, their affidavit evidence and viva voce testimony cannot be reconciled, placing credibility of both witnesses squarely in issue.

[33] My observations and assessment of credibility each witness called at trial and reliability of their evidence are outlined below.

a. Hitesh Jhaveri, Osmi Homes

[34] Hitesh Jhaveri tendered two affidavits of evidence-in-chief, which was supplemented by over an hour of examination-in-chief on authentication of documents. A short third affidavit was also tendered as ordered in Trial Directions #3 regarding a previously unproduced email purportedly attaching Alcan’s quotation, which Osmi Homes sought to rely upon at trial.

[35] During Mr. Jhaveri’s lengthy cross-examination, he was very defensive and easily provoked, especially when confronted with questions about receipt of payments and his position on allocation of payments and loan credits. He regularly interrupted examining counsel and, at times, became argumentative about why questions were being asked, even though Osmi Homes’ counsel had not objected to the questions. I found Mr. Jhaveri to be often evasive and non-responsive to straightforward questions. He was quick to explain discrepancies between his own evidence and the cross-examination evidence of Riaz Ahmed by suggesting that Mr. Ahmed had been mistaken or misunderstood questions asked, and further suggesting that discrepancies were due to Mr. Ahmed’s limitations with English. Mr. Jhaveri was also generally unwilling to concede anything during his cross-examination, unless it was clear that a concession could not be avoided, such as charges for cigarettes, lottery tickets and drinks being improperly included in gas receipts charged to Mr. Kingrani.

[36] Mr. Jhaveri’s own affidavit and viva voce evidence was also inconsistent at times, notably with respect to the dates on which work was completed or when alleged authorizations were given. Those inconsistencies were made particularly stark when dates in Mr. Jhaveri’s evidence are compared to the “critical path chart” appended to and adopted by Mr. Jhaveri in his affidavit evidence, which shows different and often later completion dates for work. Mr. Jhaveri testified that he prepared the “critical path chart” with his spouse to show the schedule for work performed on the Church Project. Mr. Jhaveri’s testimony supports that his spouse had a greater role in its preparation, although she was not called as a witness.

[37] In responding to cross-examination questions, Mr. Jhaveri also relied heavily on alleged verbal discussions with Mr. Kingrani and Osmi Homes’ subcontractors, even on significant issues, although such discussions were not referenced or discussed in Mr. Jhaveri’s affidavits or the affidavits of subcontractors with whom Mr. Jhaveri says he had relevant verbal discussions. Having failed to raise pertinent verbal discussions in any of Mr. Jhaveri’s affidavit evidence-in-chief, and without any corroboration for the discussions from documents or other witnesses, Mr. Jhaveri’s reliance on them to answer cross-examination questions appeared convenient and self-serving. While Mr. Jhaveri may genuinely believe and assume that the discussions on which he gave evidence did occur, in the absence of any corroboration, including from the other witnesses with whom the discussion are said to have occurred, I am not satisfied that his recollections of any of these many verbal discussions were accurate or reliable.

b. Anil Kumar Kingrani

[38] Anil Kumar Kingrani’s evidence-in-chief consisted of one affidavit supplemented by just under thirty minutes of viva voce examination-in-chief, mostly regarding authenticity of disputed documents. He presented well during his primary cross-examination. Mr. Kingrani spoke confidently and was not afraid to acknowledge when he could not recall specific discussions or details of the work.

[39] Significant in my assessment of Mr. Kingrani’s credibility and the reliability of his evidence is that he maintained his composure and delivered calm and unshaken evidence during what was, at times, an aggressive cross-examination, even when Mr. Kingrani was displaying visible signs of frustration with the questions being posed. Mr. Kingrani was not easily antagonized, even where the reasonableness of his own views and his evidence was being directly challenged by examining counsel. There were two exceptions:

(a) The first was a lengthy portion of his cross-examination relating to accounting and allocation of payments, during which Mr. Kingrani became frustrated with examining counsel and, at times, challenged the questions being asked. Mr. Kingrani explained that doing the accounting in cross-examination was difficult for him. He was evidently confused by the comparison exercises he was being asked to perform and related questions.

(b) The second was during his continued cross-examination on August 9, 2019, which dealt with deferred issues of smart wiring and HVAC-related matters. During this cross-examination, Mr. Kingrani often indicated that he did not understand what were clear questions, he challenged examining counsel on questions being asked, and he often appeared to be evading direct answers through equivocation. Given the confidence demonstrated during his earlier cross-examination, his equivocation seemed unwarranted and unjustified.

[40] I do not fault Mr. Kingrani for his confusion regarding the accounting and allocation cross-examination. I also found the line of questioning to be confusing. It gave rise to both an objection from Mr. Kingrani’s counsel and my own intervention. Mr. Kingrani was, as noted, visibly confused, so I do not view his struggle to answer these accounting and allocation questions as impacting his credibility. However, Mr. Kingrani’s conduct during his continued cross-examination was at odds with his earlier examination. It has impacted my view of his credibility, particularly regarding his evidence on the matters addressed in his continued cross-examination, including bald allegations that Bo Liu was lying during his testimony. Overall, I still found Mr. Kingrani to be a credible witness, although his lack of recollection of certain events and discussions has impacted the reliability of certain testimony.

c. Inconsistent evidence of Hitesh Jhaveri and Anil Kumar Kingrani

[41] Given the many conflicts in the evidence of Mr. Jhaveri and Mr. Kingrani, often irreconcilable conflicts, I have carefully considered the totality of their respective evidence against one another and further assessed it against evidence from other witnesses and contemporaneous records. I have determined that the evidence of Mr. Kingrani is generally to be preferred.

[42] Some of my reasons for that determination are already outlined above. I have also considered the availability of corroboration for some of Mr. Kingrani’s more significant evidence, lack of documentary or testimonial corroboration for much of Mr. Jhaveri’s evidence (including from Osmi Homes’ subcontractor witnesses), and certain inconsistencies between the testimony of Mr. Jhaveri and the testimony of subcontractor witnesses. A further factor has been the failure of Mr. Jhaveri, as the principal of Osmi Homes, to produce many relevant and material documents, such as quotations and estimates from subcontractors, drawings apparently provided to subcontractors, and documents that Mr. Jhaveri testified were submitted to the City of Toronto. Also, despite the litigation having been ongoing for more than three years, with examinations for discovery completed some time ago, Mr. Jhaveri continually offered to locate and produce documents that could explain gaps in his evidence. By contrast, while Mr. Kingrani at times similarly suggested that he had available and unproduced documents, his reliance on such documents to explain gaps in his evidence was significantly less than that of Mr. Jhaveri.

[43] For these and other reasons, I have determined that Mr. Jhaveri’s evidence should be given less weight than that of Mr. Kingrani, particularly on conflicting evidence. However, there are instances in which I have found Mr. Kingrani’s evidence to lack credibility or reliability and have not accepted it or have preferred the evidence of Mr. Jhaveri.

d. Riaz Ahmed, Frinz Electrical Services

[44] Riaz Ahmed provided a brief affidavit of evidence-in-chief. It addresses only general information about Mr. Ahmed’s history of working with Osmi Homes, a short summary of Frinz’s scope of electrical work for the Church Project, and a statement that Mr. Ahmed believes his pricing was fair and reasonable. The affidavit attests to his electrical work commencing on or around August 1, 2015 and that Frinz “completed the work”, but without reference to any date of completion. These facts and Frinz’s scope of work were tested on cross-examination. I found Mr. Ahmed’s testimony difficult to follow. Some straightforward questions were not answered at all or were answered evasively. Whether or not this resulted from a language barrier and failing to understand the precise questions asked, as suggested by Mr. Jhaveri during his testimony, is unclear. However, at no time did Mr. Ahmed express any inability to understand the questions and there was no suggestion made during cross-examination that an interpreter was needed.

[45] Effective cross-examination of Mr. Ahmed cast significant doubt on the accuracy and reliability of his affidavit evidence-in-chief. Nevertheless, during cross-examination, Mr. Ahmed appeared to have a good recollection of the work that he performed on the Church Project. Overall, I have found Mr. Ahmed’s affidavit evidence to be unreliable, but did find his cross-examination testimony to be fairly credible and much more reliable than his affidavit. Given the inconsistencies between his affidavit and viva voce evidence, I have given his affidavit evidence little weight and have given his viva voce evidence reduced weight. Inconsistencies between the evidence of Mr. Ahmed and Mr. Jhaveri have been addressed on a case-by-case basis.

e. Austin Green, Future World Enterprise Co.

[46] Austin Green gave evidence that was confident, honest and forthright. He demonstrated concerted effort to recall events correctly during his cross-examination and was not afraid to acknowledge when he did not recall something or was uncertain about it. He confidently gave evidence on his ordinary business practices and what he recalled and believed was done on the Church Project. I found his evidence to be quite credible, and have accordingly given it greater weight than other witnesses.

f. Gholamreza Mehrfard, 1911079 Ontario Inc.

[47] Gholamreza Mehrfard’s total examination was short, but he answered cross-examination questions confidently and acknowledged quickly when he was unable to recall specifics of the precast work performed. He did not have a strong recollection of the precise scope of his company’s subcontract work, though, which I have considered in weighing his evidence.

g. Bo Liu, Shelltech Global Inc.

[48] I found Bo Liu to be a very credible witness. His evidence was consistent and he demonstrated a clear recollection of the materials he supplied and work he performed. The only evidence on which his recollection was successfully challenged was whether he had reviewed his work with Mr. Jhaveri following its completion. Mr. Kingrani’s counsel suggests that Mr. Liu’s inability to remember when he completed his work should also be considered, but Mr. Liu candidly testified that he did not recall and would be able to confirm from his invoice. That invoice was not put to him until later in his cross-examination, after several more questions on the completion date. I do not view anything from this line of questioning as having impacted Mr. Liu’s credibility or the reliability of his evidence.

h. Rajesh Kumar Kingrani

[49] Rajesh Kumar Kingrani appeared to have been honest in his answers, but was shown through effective cross-examination to have very limited recollection of the details of the meeting at which he says he provided cash to Mr. Jhaveri. He was unable to identify Mr. Jhaveri and was shown to be uncertain about who he met with. Based on his evidence, which I believe was truthful, I am unable to find that he lacks credibility, but I have significant reservations about the reliability of his evidence.

i. Deepak Khatri

[50] Deepak Khatri spoke confidently and seemed to have a generally good recollection of the transactions that involved him. During his brief viva voce examination-in-chief, Mr. Khatri was led through various questions regarding the transactions outlined in his affidavit. His cross-examination was short, but did successfully call into question the strength of his recollections, which I have considered in weighing his evidence.

j. Vatsal Khamar

[51] Effective cross-examination of Vatsal Khamar demonstrated both his lacking recollection of the circumstances of the payments he purports to have made on behalf of Mr. Kingrani and his lacking knowledge or recollection of the payments themselves. Mr. Khamar was consistently confident, even when changing his testimony on how, to whom, and when payments were made in response to challenges on inconsistencies in his evidence. Overall, I found Mr. Khamar to lack credibility, but in any event have determined that his evidence is extremely unreliable. I have accordingly determined that it should be given no weight.

VI. Analysis

a. Scope of base contract work

[52] Osmi Homes has the evidentiary burden of establishing, on a balance of probabilities, the scope and price of the contract, including extras, performance of work, the value of services and materials that it supplied and, accordingly, the debt owing pursuant to the contract or on a quantum meruit basis. The extent of the base contract scope of work is a core disputed issue in this litigation.

[53] Both parties agree that the decision in Saatva Capital Corporation v. Creston Moly Corporation, 2014 SCC 53 is instructive. In Saatva, the Supreme Court of Canada outlined applicable principles for interpreting a contract, including the need to assess the intent of the parties and the scope of their understanding. In particular, the Supreme Court of Canada held that, when interpreting a contract, it must be read “as a whole, giving words used their ordinary and grammatical meaning, consistent with the surrounding circumstances known to the parties at the time of formation of the contract”: Saatva, supra at para. 47. The meaning of words is often derived from a number of contextual factors, including the purpose of the contract and the nature of the relationship created by the contract: Saatva, supra at para. 48. Circumstances surrounding formation of a contract are relevant considerations, but only objective evidence of knowledge that was or reasonably ought to have been held by both parties at or before the date of contracting: Saatva, supra at para. 58. Consideration of such surrounding circumstances is not precluded by the parol evidence rule: Saatva, supra at para. 60.

[54] Osmi Homes argues that subsequent conduct may also be used to interpret a written agreement because “it may be helpful in showing what meaning the parties attached to the document after its execution, and this in turn may suggest that they took the same view at the earlier date”: Montreal Trust Co. of Canada v. Birmingham Lodge Ltd., 1995 CanLII 438 (ON CA), 24 OR (3d) 97 (CA). While I accept that statement as an applicable legal principle in contract interpretation, the Court of Appeal has also recently reaffirmed that subsequent conduct is not always a reliable indicator of the intentions of the parties when entering into a contract, and should be admitted only if the contract remains ambiguous after considering its text and its factual matrix: Thunder Bay (City) v. Canadian National Railway Company, 2018 ONCA 517 at para. 63.

[55] In the present case, the first page of the construction contract states, “The ‘scope of Work’ in this agreement and its detail description is annexed below”. Appended to the contract is a schedule entitled “Scope of Work”, each page of which has been initialled by both parties. That schedule divides the contract work into eight phases and then identifies additional information and details regarding electrical, HVAC, bathroom, smart wiring, windows, doors, and plumbing work.

[56] Mr. Kingrani’s evidence is that Osmi Homes was contracted for the agreed price of $125 per sq. ft. to complete construction of the entire house as shown in the permit drawings with substantially all finishes completed. Mr. Kingrani testified that he read the “Scope of Work” schedule, but his evidence is that he was never specifically advised what, if anything, would be excluded from Osmi Homes’ scope of work. He understood when signing the contract that the “Scope of Work” schedule only represented a summary of how the construction phases would proceed, but never understood it to be a comprehensive list of Osmi Homes’ only scope of work. Mr. Jhaveri is said to have verbally confirmed, prior to signing the contract, that Osmi Homes would be constructing the house in accordance with the drawings, save for a few items that were specifically discussed, namely supply of the entrance door and all interior doors, installation of flooring, decorative light fixtures, interior painting, and finishing the basement beyond framing. Mr. Kingrani testified repeatedly during his cross-examination that he proceeded with Osmi Homes on trust and faith in Mr. Jhaveri’s representations that the increased price from that quoted by Metro Developers Group would include all work required by the permit drawings.

[57] Conversely, Mr. Jhaveri’s evidence is that the agreement was for Osmi Homes to be responsible only for rough construction of the house and that Mr. Kingrani would be responsible for all finishes. Mr. Jhaveri acknowledges that he was provided with the approved permit drawings to price Osmi Homes’ scope of work prior to preparing the contract. He says the $125 per sq. ft. price was not based on a substantially completed house, but rather that Osmi Homes’ only contract scope of work is expressly set out in the “Scope of Work” schedule to the contract. Items not listed in that schedule were not items for which Osmi Homes was responsible. In his affidavit evidence, Mr. Jhaveri describes his understanding (rather than express agreement) of who was responsible for which portions of the overall work as follows:

My understanding was that I was to tear down the old house, excavate for the new basement, pour the foundations and basement walls, erect the structure including the roughed in staircase, supply and install the furnace and air conditioner, install the rough in plumbing, heating and air conditioning, electrical and all of the internet, smart services, telephone, sound and security systems, insulate and drywall the interior, shingle the roof, supply and install the windows, skylights and certain exterior doors.

My understanding was that Anil Kumar wanted to complete all of the exterior and interior finishing touches with his own ideas to make the house stand out for resale, as he wanted, to maximize his profit.

My understanding, of what new home buyers look for, are the paint colors, the kitchen and bathroom finishing (tiles, cabinets, appliances and fixtures), the front door and the garage door, which normally match for appearance, and the “in your face” finishes.

I agreed not to add these types of items in my pricing of my company’s scope of work.

[58] In preparing the contract, Mr. Jhaveri suggests that he “mimicked” the exclusions from Alcan’s quotation, which he says was provided to him by Mr. Kingrani. Alcan quoted Mr. Kingrani a contract price of $389,000 plus HST. The quote includes a bulleted list of work to be performed and a separate bulleted list of exclusions. The exclusions are similar to the items argued by Osmi Homes to be excluded from its contract scope of work.

[59] Alcan’s quotation is a key document to Osmi Homes’ position on formation of the contract. Nevertheless, it was not produced during documentary or oral discoveries and was not ultimately produced until after Mr. Kingrani had already served his affidavit trial evidence. In my view, that alone is a sufficient basis to deny leave under Rule 30.08 of the Rules of Civil Procedure for Osmi Homes to rely on the document, and I accordingly so deny leave. In any event, I have significant reservations regarding Osmi Homes’ attempt to rely on Alcan’s quotation and effectively incorporate the exclusions itemized therein as exclusions to Osmi Homes’ scope of work. Even if I had not denied leave to rely on it, I would have given Mr. Jhaveri’s evidence on Alcan’s quotation no weight in determining the base contract scope of work for the following reasons:

(a) First, Mr. Jhaveri provided no evidence supporting any agreement by Mr. Kingrani that similar exclusions to those identified in Alcan’s quotation would apply to Osmi Homes’ contract scope of work. At best, Mr. Jhaveri’s evidence is that he assumed the same exclusions applied. Mr. Kingrani testified that he did not know how Mr. Jhaveri obtained Alcan’s quotation and did not recall sending it to him. He was not cross-examined about the discussions that Mr. Jhaveri purports to have had with him about Alcan’s quotation in reaching agreement on Osmi Homes’ scope of work.

(b) Second, the base contract price in Alcan’s quotation is significantly lower than the subject contract. In my view, interpreting any parallel scope of work or exclusions in the absence of evidence corroborating an understanding or agreement by both parties that the same exclusions applied would lead to a commercially unreasonable result.

(c) Third, Mr. Jhaveri’s evidence that he “mimicked” the exclusions was not tendered in his first affidavit, which instead states that he drafted the contract “based on a sample that I found.” Alcan’s quotation was introduced in his second affidavit, written following service of Mr. Kingrani’s evidence. Osmi Homes’ contract scope of work is a core disputed issue in this litigation. While Trial Directions #2 provided Osmi Homes with an opportunity to serve responding and reply affidavits of evidence-in-chief, this apparently key evidence on agreed exclusions is, in my view, neither proper responding evidence to the evidence tendered by Mr. Kingrani for his counterclaim nor proper reply evidence.

[60] Mr. Kingrani disputes that there were any agreed or approved extras, and takes the position that certain extras claimed by Osmi Homes were part of the base contract scope of work, namely all exterior precast work, all exterior stucco work, basement framing, installing all soffits and eaves, supplying and installing a metal roof over the front porch, and installing all required pot lights. Before addressing whether these items form part of the base contract scope of work, an important aspect of the factual matrix in formation of the contract between Osmi Homes and Mr. Kingrani is the change in contractors from Metro Developers Group to Osmi Homes. Mr. Kingrani testified that if no additional scope had been included in Osmi Homes’ contract, then he would look “stupid” to have agreed to an increased price from the $95 per sq. ft. with Metro Developers Group to the $125 per sq. ft with Osmi Homes. Mr. Kingrani thereby argues that additional scope had to be included in Osmi Homes’ price and that his agreement to an increased price of $30 per sq. ft. was reasonably and logically because Osmi Homes had agreed to complete a broader scope of work than what Metro Developers Group had been offering to do.

[61] Mr. Jhaveri’s affidavits do not address what role, if any, Metro Developers Group’s contract scope of work had in negotiations with Mr. Kingrani. Mr. Jhaveri’s affidavits state only that the $125 per sq. ft. price was “based on the instructions of Anil Kumar” and that Osmi Homes “never agreed to carry out all of the work as set out in the Drawings.” Mr. Jhaveri was evidently aware of the prior contractual negotiations between Metro Developers Group and Mr. Kingrani at the time of negotiating the contract for Osmi Homes, yet Mr. Jhaveri’s testimony never denied receiving, reviewing or considering Metro Developers Group’s contract scope of work in developing Osmi Homes’ scope of work.

[62] The evidence does support that Osmi Homes’ overall scope of work was somewhat broader than that contemplated in Metro Developers Group’s contract. However, if Osmi Homes’ position on scope is accepted, the additional scope does not appear to be substantive. In some cases, the scope is actually reduced. For example, Osmi Homes’ position is that eavestroughs and soffits were excluded from its base contract scope of work, but Metro Developers Group’s contract included completion of eavestroughs, down spouts, soffits and fascia. While it is uncontested evidence that Metro Developers Group sought to renegotiate its contract price when the new drawings for a larger house were prepared, Mr. Kingrani was not cross-examined on any details of that. There is no basis in the evidence to find that the $95 per sq. ft. price would have been the subject matter of the requested renegotiation.

[63] No argument was advanced by Osmi Homes to explain why Mr. Kingrani would agree to an increased contract price of $30 per sq. ft. with no substantive additional scope included in the price. I have considered the conflicting evidence of Mr. Kingrani and Mr. Jhaveri on the representations purportedly made by Mr. Jhaveri regarding Osmi Homes’ scope of work, particularly in light of the lack of any evidence from Osmi Homes on how the $125 per sq. ft. price was reached and Mr. Jhaveri’s unexplained statement that it was “based on the instructions of Anil Kumar”. I accept Mr. Kingrani’s evidence and find that Mr. Jhaveri did represent that additional work would be included in Osmi Homes’ contract price in comparison to the scope of work in Metro Developers Group’s contract. Mr. Kingrani’s evidence is credible and consistent with the fact that he agreed to contract with Osmi Homes at a higher contract price. However, my finding does not mean that all work identified in Metro Developers Group’s contract is necessarily relevant to determining Osmi Homes’ agreed base contract scope of work.

i. Exterior precast and stucco

[64] Precast trim, columns and panels are shown on permit drawing nos. A3.1, A3.3 and A3.4 and stucco is shown on permit drawing nos. A3.1 and A3.3. There is no reference to precast or stucco work in the contract. It is neither expressly included nor expressly excluded in the scope of work. In Phase 4 of the “Scope of Work” schedule, Osmi Homes’ scope is stated to include “All Structural Walls and Trusses as per drawings.” Mr. Kingrani argues that all exterior walls are structural walls and that, accordingly, completion of structural walls should include the material prescribed by the drawings to be installed as part of those walls, including precast and stucco. Osmi Homes argues that precast trim, columns and panels and stucco work are all veneers, so are non-structural and thereby not captured by that provision.

[65] I agree with Osmi Homes that the precast and stucco work is non-structural veneer. Permit drawing nos. A3.1, A3.3 and A3.4 show substantial “stone veneer” and “brick veneer”. Phase 8 of the “Scope of Work” schedule provides that Osmi Homes is responsible for “External stone & Brick as per drawing. (Red brick and basic external stone as per Builder sample)”. “Structural walls” are clearly identified in a different phase from supply and installation of that veneer. In my view, it would strain the ordinary and grammatical meaning of “structural walls” to interpret it as including all related veneer, and such an interpretation would also be inconsistent with a separate scope item for veneer. I accordingly find that non-structural veneer is not included in the “structural walls” scope item.

[66] There is no dispute that Osmi Homes’ scope of work included stone and brick veneer. Mr. Kingrani was cross-examined on the fact that there is no reference to precast or stucco in the Phase 8 description. He testified that he did not know precast and stucco were not listed and confirmed that he did not question why they were not listed at any time. Mr. Kingrani’s evidence is that Mr. Jhaveri never advised him during contract negotiations that precast and stucco were excluded from Osmi Homes’ scope of work.

[67] Mr. Jhaveri’s contrary evidence is that the precast and stucco work was always understood and agreed to be excluded. With respect to precast, Mr. Jhaveri’s second affidavit sought to justify it as an extra on the basis that actual installation of precast varied from the precast locations depicted in the permit drawings. He also pointed to a precast medallion fabricated and installed at the house that is not reflected in the drawings, which was designed in coordination with Mr. Kingrani. Mr. Jhaveri’s affidavit also refers generally to “discussions between Anil Kumar and myself as to where the precast was to be used.” However, none of his affidavit evidence-in-chief states that he and Mr. Kingrani agreed on a specific scope of precast work to be performed or that the work would be charged as an extra. With respect to stucco, Mr. Jhaveri’s evidence is that Mr. Kingrani approached him to complete the stucco work because Mr. Kingrani “did not want to do it.” During cross-examination, Mr. Jhaveri testified that he and Mr. Kingrani verbally discussed the extra on site and that Mr. Kingrani knew and agreed to an approximate price for the stucco work in advance of any work being performed, but acknowledged that evidence was not included in his affidavits.

[68] While it is undisputed that actual locations of installed precast vary from the drawings, I do not agree that a variance between the drawings and actual locations of installed precast supports that precast work was always intended to be an extra. Changes to a contractor’s base contract scope of work are common in construction, and not all such changes are compensable extras.

[69] In an email dated October 6, 2015, Mr. Jhaveri provided a list of work that was said to have been completed by that time, which included the following statement:

Kindly look into the following work that has been completed and also an extra work of Pre Cast, additionally done which was beyond the contract.

Additional extra work of Pre Cast Completed.

[70] In my view, this email also does not assist Osmi Homes. The language in respect of precast is not definitive that all precast work was extra work. Rather, the language is equally consistent with extra precast work having been done. For example, as noted above, an additional precast medallion for the property address was agreed between the parties, fabricated and installed, but is not reflected in the permit drawings. Stucco is not mentioned in the email at all, although Mr. Jhaveri testified that was because the work had not yet been completed.

[71] Brick and stone veneer appear to represent the vast majority of exterior veneer in the permit drawings. Comparatively, precast and stucco are smaller exterior elements. There is no evidence regarding the total area of brick and stone veneer depicted in the permit drawings as compared to the total area of precast and stucco work. I agree with Mr. Kingrani that Osmi Homes elected to draft the “Scope of Work” schedule to exclude specific finishes, such as certain doors, railings, pickets, a chandelier, and decorative lights, yet did not draft any specific exclusion for precast or stucco. As outlined earlier in these reasons, Osmi Homes also failed to provide any argument or explanation for why Mr. Kingrani would agree to an increased price of $125 per sq. ft. without any substantively increased scope of work from Metro Developers Group’s contract.

[72] Having weighed the evidence, and taking into account the details of the permit drawings, that Osmi Homes had the full drawings available when it prepared the contract, Mr. Kingrani’s agreement to an increased contract price, the lack of any specific exclusionary language in the contract, and the circumstances surrounding the contract formation that are before the court, I find that a reasonable person in Mr. Kingrani’s position would understand that, since all brick and stone veneer was included in Osmi Homes’ scope of work, all exterior veneer elements were included. I do not accept Mr. Jhaveri’s evidence that Mr. Kingrani requested precast and stucco to be done as extras, and accept Mr. Kingrani’s evidence that he was never advised by Mr. Jhaveri such work was excluded.

[73] In my view, clear exclusionary language was required if Osmi Homes intended for its scope of work to include only the majority of external veneer and exclude other veneer, with the result that there would be voids or gaps in the veneer to be completed by Mr. Kingrani. This is particularly true in the absence of any evidence corroborating Mr. Jhaveri’s testimony regarding agreement to such an exclusion. To hold otherwise would, in my view, be a commercially unreasonable interpretation of the contract in all the circumstances. I accordingly find that the parties understood and agreed that Osmi Homes would complete all exterior veneer depicted in the permit drawings as part of the base contract scope of work.

[74] That does not, however, completely dispose of Osmi Homes’ claims for precast and stucco extras. Changes to the work depicted in the permit drawings may be compensable. I address the claimed extra further below.

ii. Basement framing

[75] It is undisputed that Osmi Homes’ base contract scope of work excluded finishing the basement. Mr. Kingrani confirmed as much during his cross-examination. The dispute is whether Osmi Homes was nevertheless contractually required to frame the basement. For the following reasons, I find that it was not.

[76] Phase 8 of the “Scope of Work” schedule states, “Basement will be totally unfinished and only one bathroom rough in will be provided as per O.B.C.” In the same schedule, under the heading “DOOR Details”, there is a further entry that reads, “The cold room door in basement not included (The basement is entirely unfinished).” The language of “totally unfinished” and “entirely unfinished” are, in my view, significant and unambiguous language.

[77] Mr. Kingrani’s evidence is that he understood Osmi Homes would be performing all necessary framing work, including framing the basement. His affidavit evidence states, “I understood that the basement would not be finished but I certainly expected to see it framed with wood studs (like every other unfinished basement that I’ve seen).” Mr. Kingrani argues that basement framing is captured by “All Framing work as per permit drawings”, found in Phase 4 of the “Scope of Work” schedule. Mr. Jhaveri’s evidence is that he was asked by Mr. Kingrani to do the basement framing. He agreed and subcontracted the work.

[78] While Mr. Kingrani’s evidence is that “every other unfinished basement that [he has] seen” is framed, no context for that observation was given. In my view, it is a self-serving opinion without foundation, and I have given it no weight. Mr. Kingrani tendered no evidence supporting that an unfinished basement generally includes framing or supporting that a reasonable person in Mr. Kingrani’s position would understand that basement framing was included despite unambiguous language in the “Scope of Work” schedule that the basement is to be entirely unfinished. In my view, to interpret the language used to mean “unfinished, except that wood framing will be completed” is inconsistent with the ordinary and grammatical meaning of “total unfinished” and “entirely unfinished”. I accordingly find that basement framing was not part of Osmi Homes’ base contract scope of work.

iii. Soffits and eaves

[79] Soffits and eavestroughs are depicted in the permit drawings. Mr. Jhaveri’s evidence is that soffits and eaves were excluded from Osmi Homes’ scope of work, were requested by Mr. Kingrani, were discussed as an extra, and then were supplied and installed on that basis. Mr. Kingrani disagrees. Other than Mr. Jhaveri’s self-serving statements, no contemporaneous or corroborating evidence was tendered supporting any discussion that soffits and eaves would be excluded from Osmi Homes’ scope of work. Osmi Homes relies solely on Mr. Jhaveri’s direct evidence in his first affidavit, which states as follows:

My company did not include the soffit and eaves in the construction contract as this is a finishing touch that can be a simple design or an elaborate design, which could even be made out of copper and may be a different color based on the brick color. During the construction work, Anil Kumar requested of my company that my company install a standard soffit and eaves. My company agreed to carry out this work and my company arranged to have the soffits and eaves manufactured and installed.

[80] During cross-examination, Mr. Jhaveri clarified that the claimed extra was for supply and installation of all soffits, eaves, and downspouts. He acknowledged that there was no agreement with Mr. Kingrani regarding the price of the extra prior to work being performed, but he maintained that it was an agreed extra. Mr. Jhaveri confirmed that the aluminum installer did not provide an invoice for his work, and acknowledged that there was no evidence regarding the installer’s identity, any installation subcontract, or the alleged $2,000 payment made for the work. Mr. Jhaveri’s testimony was that he clearly had to spend money on someone to install it, since everything was installed.

[81] Soffits, eaves and downspouts are a required feature in home construction. Mr. Jhaveri confirmed during his cross-examination that they would have to be installed, even though he maintained that they were not part of Osmi Homes’ scope of work. Eavestroughs and soffits were included in Metro Developer Group’s price of $95 per sq. ft. No argument was advanced by Osmi Homes to explain why Mr. Kingrani would have agreed to exclude that scope from the higher contract price of $125 per sq. ft. In my view, absent contemporaneous documents or other testimony substantiating agreement to the exclusion, clear exclusionary language in the contract was required if Osmi Homes did not intend to install soffits and eaves. There is no such exclusion. Moreover, the credibility of Mr. Jhaveri’s evidence was called into question by his apparent addition of downspouts as part of the extra during cross-examination. I find Mr. Jhaveri’s evidence on exclusion of soffits, eaves and downspouts and agreement to an extra to be unconvincing. As outlined above, I have generally preferred Mr. Kingrani’s evidence where it conflicts with that of Mr. Jhaveri. This is one instance. I accordingly find that standard soffits and eaves, as well as downspouts, formed part of the base contract scope of work.

iv. Metal cap over the front porch

[82] A copper roof assembly over the front porch is depicted and detailed on permit drawing nos. A2.3 and A3.1. There is no dispute that the work was performed and it is undisputed that, instead of copper, another metal was used for the porch roof, referred to by the parties as a “metal cap”. Mr. Jhaveri’s cross-examination testimony was that the metal cap was done instead of copper at the direction of Mr. Kingrani, because Mr. Kingrani did not want to spend the money on copper (although Mr. Kingrani was not cross-examined on that point). Regardless of Mr. Kingrani’s reasons, it is undisputed that the material was changed prior to installation.

[83] Neither the front porch nor the copper roof assembly over the porch is referenced in the contract. Mr. Jhaveri’s evidence is that the metal cap was not included in Osmi Homes’ scope of work because “it was a finishing touch which could be constructed of different material or shape depending on the final finish that [Mr. Kingrani] Kumar wanted.” Mr. Kingrani disagrees, and his evidence is that it was included in Osmi Homes’ scope of work. With one exception, I was directed to no evidence corroborating any agreement excluding the front porch roof assembly. The only evidence tendered as corroboration is an email from Mr. Kingrani dated January 28, 2016, relied upon by Osmi Homes as confirming approval of the metal cap as an extra and authorizing the work to proceed. In that email, Mr. Kingrani states as follows:

please move forward for the cap u were talking about top of door on 132 church ave, we will settle the charges in our account, so do not stop the work for that

[84] During his cross-examination, Mr. Kingrani denied that his statement had anything to do with an extra. He testified that the reference to “settle the charges on our account” was in respect of a problem with Osmi Homes’ accounts, not the metal cap. I accept Mr. Kingrani’s explanation. In my view, the undisputed agreement for substitution of roofing material is relevant context in assessing this email. The language used is consistent with two separate statements having been made: first, a request for Osmi Homes to proceed with the discussed substituted metal cap and, second, a request that Osmi Homes does not stop work because of a dispute regarding amounts charged. I accordingly reject Osmi Homes’ argument that this email is inconsistent with Mr. Kingrani’s position that the metal porch roof was included in the base contract scope of work.

[85] Mr. Jhaveri confirmed during cross-examination that construction of the porch was included in Osmi Homes’ scope of work, although he characterized the work as being part of building the wall foundation and ceiling of the cold cellar. Other than Mr. Jhaveri’s testimony, no evidence supports that the parties understood the porch roof assembly was excluded scope at the time of signing the contract. There is also no evidence of any notice from Osmi Homes that the work would be treated or charged as an extra.

[86] In all the circumstances, I find that Mr. Jhaveri’s uncorroborated evidence that the contract scope of work included the front porch, but excluded the porch roof assembly that is clearly depicted on the drawings used by Osmi Homes to price the job, lacks credibility. However, since the parties did agree to a material substitution, the impact of that change in the work on the contract price remains to be assessed, and is addressed further below.

v. Pot lights

[87] It is undisputed that pot lights were part of the base contract scope of work. Osmi Homes claims that a total of 116 pot lights were supplied and installed, and that the additional 16 pot lights constitute a compensable extra. Mr. Kingrani’s affidavit evidence states that he expected Osmi Homes to install all of the pot lights depicted in the drawings, he did not count the number of pot lights, and he was never told that pot lights required beyond the 100 pot lights noted in the contract would be charged as extras. Since the contract is silent on who bears the cost of additional pot lights, I have accordingly considered whether it was reasonable for Mr. Kingrani to believe that Osmi Homes’ scope of work included all required pot lights, or whether the two explicit references to “100 pot lights” supports that additional pot lights would be an extra.

[88] The “Scope of Work” schedule to the contract sets out that Osmi Homes was to provide electrical rough-in with 100 pot lights. There are two separate references to “100 pot lights” in the schedule. Notably, the “Electric Work Detail” section stipulates as follows (emphasis in original):

Installation of light fixture is included with total 100 pot lights with LED installed indoors & outdoors. (Does not include supply or installation of chandelier & other Decorative lights).

[89] There is no evidence that any drawings other than the permit drawings were available to Osmi Homes when it priced the work and drafted the contract. I agree with Osmi Homes that the permit drawings do not depict any pot lights. Mr. Jhaveri’s evidence is that Osmi Homes was not provided with any electrical or mechanical drawings, so assumptions had to be made regarding the electrical and mechanical needs of the house. He states in his reply affidavit, “I only guessed as to how many pot lights may be needed in my pricing. If more pot lights were wanted by Anil Kumar, he would have to pay for them separately.” There is no evidence from Mr. Kingrani contradicting Mr. Jhaveri’s evidence that he only estimated the required number of pot lights.

[90] In my view, nothing in the evidence supports the reasonableness of Mr. Kingrani’s assumption that all required pot lights were to be installed. There are no electrical or mechanical drawings in evidence and nothing to suggest that Osmi Homes could have known or calculated the precise number of required pot lights to price accordingly. The “Scope of Work” schedule expressly states the total number of included pot lights. Osmi Homes went so far as to bold the second reference. I find no ambiguity in the language used. I accordingly find that the base contract only required Osmi Homes to supply and install 100 pot lights. Whether the claimed additional pot lights are a compensable extra is addressed further below.

b. Extras

[91] Osmi Homes claims a total of $100,305 in extras, which Mr. Jhaveri says was all additional work performed at Mr. Kingrani’s request and with his prior approval. I have already found that some of that work forms part of the base contract scope of work, although that does not itself vitiate Osmi Homes’ claims for extras in respect of changes to that work. Extras are claimed for the following work:

(a) exterior precast work;

(b) stucco work on the exterior walls;

(c) additional brickwork installed in the basement walkout;

(d) basement framing;

(e) soffits and eaves;

(f) the metal roof over the front porch;

(g) paying for surveys and engineering reports;

(h) priming the interior walls;

(i) winter heating costs;

(j) generator gas costs;

(k) supplying and installing a cold room door; and

(l) electrical changes for 16 additional pot lights, moving two electrical outlets, and installation of cabinet lighting.

[92] The contract is silent on how extras are to be treated. Testimony from Mr. Jhaveri and Mr. Kingrani on approval of extras is in direct conflict. Mr. Jhaveri gave evidence that, because the Church Project was his first home construction for someone other than himself, he did not paper changes with respect to added costs, but that all extras were discussed and verbally approved before work was performed. He relied on his relationship with Mr. Kingrani in dealing with changes. Conversely, Mr. Kingrani’s evidence is that no extras were discussed or approved, and that claimed extras are all work within the base contract scope of work, additional work performed without prior approval from Mr. Kingrani, or alleged work that has not been proven on the evidence.

i. Relevant law

[93] In assessing Osmi Homes’ entitlement to be paid for “extras” to its fixed price contract, the following principles apply:

(a) Whether a particular item of work constitutes an extra is determined by reference to the terms of the contract, the nature of the work, and the surrounding circumstances. The contractor will be able to recover payment on a quantum meruit basis only if it has performed work for the owner in pursuit of a contract which changed so fundamentally that the payment provisions in the contract no longer have any application to the work actually performed, which gives rise to an implied promise to pay what the work is reasonably worth: Network Site Services Ltd. v. Town of Oakville, 2018 ONSC 2599 at para. 201.

(b) For fixed price contracts, in the absence of a contractual provision addressing how extras are to be dealt with, an express or implied agreement is required covering the supply of and payment for work beyond the scope of the contract: D&M Steel Ltd. v. 51 Construction Ltd., 2016 ONSC 1335 at para. 112.

(c) Generally, in a fixed price contract, a contractor is not entitled to charge an extra for work that is not within the scope of the contract without express or implied instructions to perform that work by the owner: Alcos Machinery Inc. v. Del Industrial Metals, 2019 ONSC 1187 at para. 242.

(d) What amounts to instructions from the owner will depend on the circumstances relating to each item of work, but an owner may be found to impliedly assent or acquiesce to the extra by conduct such as knowingly permitting the contractor to perform work without giving definite instructions: Alcos Machinery Inc., supra at paras. 243-244 and Network Site Services Ltd., supra at paras. 202-203.

[94] There are three primary considerations in assessing extras, namely (a) whether the base contract scope of work changed so fundamentally that the contract price no longer applies to the services and materials actually supplied, (b) whether there was an express or implied agreement for supply of services and materials claimed as extras, and (c) in the absence of agreement on a price for the extras, whether the value of extras has been proven on a quantum meruit basis: D&M Steel Ltd., supra at para. 113 and Network Site Services Ltd., supra at para. 201.

ii. Lack of corroborating evidence

[95] During cross-examination, Mr. Kingrani testified unequivocally that Mr. Jhaveri never discussed any extras with him. He denies that any extras were agreed or approved. Osmi Homes points out that Mr. Kingrani’s position is that Osmi Homes was paid a total of $586,844, which is just over $18,000 higher than the total contract price of $568,672.50. Mr. Kingrani is argued to be an educated man, both a trained engineer and a money lender, so knew how to account for payments and receipts, yet nevertheless failed to provide any explanation for why his accounting shows overpayment to Osmi Homes if there were no approved extras.

[96] I agree with Osmi Homes that Mr. Kingrani’s evidence is self-serving. It is also unsupported by numerous instances in which changes to the work were evidently agreed and by Mr. Kingrani’s unexplained overpayment of the contract price based on his own accounting. However, it is significant in my assessment that Osmi Homes has no contemporaneous documentary corroboration of any agreement with Mr. Kingrani for the claimed extras. Mr. Jhaveri’s evidence is that only verbal approvals were provided. During cross-examination, he confirmed that quotations or price estimates for extras were not provided to Mr. Kingrani prior to completing the extra work. He testified that they had a relationship whereby they just moved forward, would talk about costs and agreed they would settle accounts later, which was how he says they did business. As already noted, Mr. Kingrani’s contrary evidence is that there were no discussions regarding extras.

[97] During his cross-examination, Mr. Jhaveri referred to “nasty” emails and messages from Mr. Kingrani as well as other text exchanges prior to October 6, 2015. That is the date of an email that Mr. Kingrani says was his first receipt of Osmi Homes’ invoices. None of these so-called “nasty” emails or messages were put into evidence at trial. Very limited email and text correspondence between the parties was tendered at all. The court accordingly has no sense for the nature of written communications that were exchanged between the parties. The “nasty messages” referenced by Mr. Jhaveri may have provided some contemporaneous corroboration to his evidence that Mr. Kingrani had daily involvement in the project and was fully aware of all changes and extras prior to work being performed.

iii. Exterior precast

[98] The parties agree that as-built locations of precast elements were varied from the permit drawings. I have already found that the permit drawings depicted the scope of precast work included in the contract price. The evidence supports that an additional precast medallion was designed in coordination with Mr. Kingrani and thereafter fabricated, supplied and installed. I accept Mr. Jhaveri’s evidence that he and Mr. Kingrani did discuss and agree on the size and location of precast pieces ultimately installed. I accordingly find that the parties agreed to changes in the precast work. However, I am not satisfied that the evidence supports a finding that the base contract precast work was sufficiently changed to warrant an extra. I thereby need not consider whether there was an express or implied agreement to Osmi Homes charging an extra, or quantification of the value of extra work performed.

[99] There was no evidence on the extent of precast that would have been required to complete the precast identified in the permit drawings. Although there was some verbal indication of actual precast locations in viva voce evidence, there is no clear evidence from either party regarding the installed precast locations or the extent of installed precast as compared to the precast elements outlined in the permit drawings. No photographs of the as-built house or its features were tendered in evidence. Mr. Jhaveri testified that the precast locations were identified on drawings provided to the precast fabricator, 1911079 Ontario Inc., although apparently Osmi Homes did not retain a copy of those drawings and they were not in evidence.

[100] Gholamreza Mehrfard was called regarding the fabrication and supply of the precast pieces by 1911079 Ontario Inc. During his cross-examination, he confirmed that the precast elements were fabricated in September and October 2015 based on a verbal agreement with Mr. Jhaveri as to price, that his company was paid by Osmi Homes, and that there were changes to the precast elements from the permit drawings. However, he gave no evidence on the extent of those changes or the extent of precast fabricated. The invoice from 1911079 Ontario Inc. has no such details.

[101] No witness from the precast installer, Romstroy, was called. The installation invoice from Romstroy includes only a price per sq. ft. for installation of stone and precast, with no distinction between stone and precast work and no indication of where work was performed. An allocation for the precast work has been handwritten onto the invoice, but the author was never identified in evidence. The invoice itself is silent on the site at which work was performed, although copies of cashed cheques paid to Romstroy, which total $34,000 (less than the $35,422.79 invoiced) each indicate the Church Project. However, those cheques have no invoice references and also refer to either or both of stone and brick labour, but not precast labour.

[102] While locations of precast elements were changed, the evidence does not support any increase to Osmi Homes’ overall scope of precast work. Osmi Homes has failed to meet its evidentiary onus of demonstrating that there was any additional precast work performed beyond what was required by the contract. I accordingly find that there is no valid claim for an extra regarding precast work.

iv. Exterior stucco work

[103] I have already found that supply and installation of the stucco work depicted in the permit drawings formed part of Osmi Homes’ base contract scope of work. In my view, the evidence does not support any sufficiently material change to the scope or price of stucco work to warrant an extra. Osmi Homes’ stucco installation subcontractor, Janos Farkos, was not called as a witness. No evidence was tendered on the extent of work that would have been required to complete the stucco identified in the permit drawings, the extent and locations of stucco work actually performed, or any variances from the permit drawings. In the absence of evidence supporting a change in the scope or price of stucco work, I find there is no valid claim for an extra.

v. Brickwork in basement walkout

[104] Mr. Kingrani does not dispute that Osmi Homes performed additional brickwork in an area around the walkout where no brickwork is shown on the permit drawings. Osmi Homes claims $5,085 for that additional brickwork, which is comprised of amounts paid for materials, labour to lay the brickwork, and a 20% markup for “for the ordering, designing and supervising the brick work.” Osmi Homes claims for 1,950 bricks supplied by Commonwealth Brick & Building Supplies Limited at a price of $0.72 per brick, plus labour at $1.20 per brick for work laying the brickwork as charged by Romstroy. Mr. Kingrani disputes that it was an agreed or approved extra. Having assessed the evidence, I find that Osmi Homes has failed to meet its evidentiary onus of proving that the additional brickwork constitutes a compensable extra.

[105] No evidence was tendered regarding the scope of brickwork contemplated by the contract. Mr. Jhaveri testified that required brickwork was included in a back elevation drawing that was not in evidence. Osmi Homes relies entirely Mr. Jhaveri’s testimony in proving that an additional 1,950 bricks were supplied and installed. However, nothing in Mr. Jhaveri’s evidence supports that he has any personal knowledge regarding the number of bricks required by the contract or the number actually installed. Mr. Jhaveri testified that his construction supervisor at the time, Kalpit Patel, counted the number of additional bricks. Mr. Patel was not called as a witness, and no email or document from Mr. Patel was tendered confirming his brick count or otherwise substantiating the 1,950 brick figure. Handwritten charge calculations are included on Romstroy’s invoice, but that invoice post-dates Osmi Homes’ invoice to Mr. Kingrani for the extra brickwork. Mr. Jhaveri testified that the calculations were prepared by Mr. Jhaveri’s spouse, who was also not called as a witness, and that he knew the amount that had to be billed prior to receiving Romstroy’s invoice because of the brick count by Mr. Patel. Romstroy charged for installation of 12,528 bricks, with no details regarding where the bricks were installed.

[106] I find that Mr. Jhaveri has no actual knowledge of the installed brick count, and is relying entirely on the information that he never personally verified received from others, none of whom were called as witnesses. I have accordingly determined that his evidence on the number of “extra” bricks should be given no weight.

[107] Evidence from Mr. Kingrani and Mr. Jhaveri is also in direct conflict regarding discussion and approval of additional brickwork. In his affidavit evidence, Mr. Kingrani states that Mr. Jhaveri told him the additional brickwork had been installed after-the-fact, and that Mr. Jhaveri said it was done because he “thought it would look better.” Mr. Jhaveri’s affidavit evidence acknowledges that he felt the area needed to be done “to make the basement walkout a more attractive area”, but he states that the discussion happened before the work was done and that the two “discussed that this was not part of the construction contract and was an extra.” This is another instance where I have preferred Mr. Kingrani’s evidence. There is no evidence corroborating that Mr. Kingrani requested or authorized the additional brickwork, was given notice that the work was being performed, that the work was considered an extra, or the price that would be charged for the work. I accept Mr. Kingrani’s evidence that the work was performed by Osmi Homes prior to Mr. Kingrani being aware that it had been done.

[108] In these circumstances, I find that Mr. Kingrani did not expressly agree, assent or acquiescence to the work. I accordingly find there is no valid claim for an extra regarding the additional brickwork. Osmi Homes proceeded with the work without authorization or approval, and did so at its own risk if Mr. Kingrani did not agree to pay for it, which he did not.

vi. Basement framing

[109] I have found that basement framing did not form part of Osmi Homes’ contract scope of work. In my view, the additional work of framing the basement is a sufficiently fundamental change to the contract scope of work to constitute an extra. However, for it to be a compensable extra, there must have been express or implied agreement between Osmi Homes and Mr. Kingrani to the extra and either an agreed price or quantifiable value for the services and materials supplied.

[110] Mr. Kingrani argues that he cannot have agreed to the work, since there were no layout drawings for the basement framing and Austin Green testified that the work was performed at the instructions of Mr. Jhaveri. He further argues that a reasonable owner would expect the contractor to seek instruction or input on what the owner wanted in the basement before proceeding with framing. I do not accept that argument. A layout for the basement is provided in permit drawing no. A2.2, which includes the locations and dimensions of all basement rooms, such as a bedroom, recreation room, and theatre. There is no evidence that framing was not in accordance with this layout, and similarly no evidence supporting that Osmi Homes completed the work in a layout to which Mr. Kingrani objected. Mr. Kingrani alludes to the basement framing being performed improperly in a commentary at Exhibit M to his affidavit, but no evidence substantiating that allegation was tendered. Nothing in the evidence suggests that basement framing has specialized requirements for which detailed specifications would be required. I am satisfied that Austin Green is an experienced framing contractor, and that Future World would have been unable to frame the basement with reference to the permit drawings.

[111] There is no evidence supporting any discussion or express agreement for the framing work to be charged as an extra before the work was performed, or discussion of any price for the work. However, Mr. Kingrani confirmed it was his expectation that basement framing would be completed, and it is undisputed that he was aware the work was being performed. While I accordingly accept that Mr. Kingrani did not expressly agree to the framing work as an extra, he was aware that the work was being performed and did not object to either the work proceeding or the layout a framed. Mr. Kingrani assented to the work being performed as it was done.

[112] There was no quotation for the work and no evidence supporting any agreement as to price prior to the work being performed, so it falls to Osmi Home to prove the value of the work on a quantum meruit basis. In my view, Osmi Homes has proven the claimed cost of the installation work, but has failed to satisfy its evidentiary onus of proving the claimed cost of lumber materials supplied.

[113] Future World charged Osmi Homes the sum of $8,500 plus HST for installation of the basement framing. Austin Green testified that the price was negotiated and paid in advance by Osmi Homes at Mr. Green’s request. He testified in cross-examination that such pre-payment was his ordinary practice in working with Mr. Jhaveri where he was working on multiple concurrent projects involving substantial labour. There is no indication in the evidence regarding when the price for the basement framing work was negotiated and agreed between Osmi Homes and Future World. I thereby infer and find that the basement framing work was negotiated, subcontracted and pre-paid at approximately the same time in early October 2015. I also find that the amounts paid to Future World represent a reasonable amount for the work performed and accept that amount in assessing the value of the extra on a quantum merit basis.

[114] Osmi Homes claims lumber material costs of $4,088 for purchases from Canada Tools Supplies Ltd., Rona, and Home Depot from August and October 2015. The invoices and receipts were not totalled anywhere in Osmi Homes’ evidence, and do not total the claimed amount of $4,088. For one invoice, the purchased items are covered by a payment receipt and cannot be seen. Mr. Jhaveri testified that the agreement to complete basement framing was reached prior to lumber being ordered in August 2015, and that he purchased lumber for the basement framing well before the work commenced because he always buys lumber in bulk and then additional lumber as needed.

[115] I do not accept Mr. Jhaveri’s evidence regarding purchasing lumber for basement framing in August, months before that work was performed, which I have also found is work that had not yet been subcontracted. In my view, Mr. Jhaveri’s evidence is self-serving and lacks credibility, particularly since no evidence supports that he personally ordered, picked up, delivered, or was present during delivery of any of the lumber. He did not testify that he personally made these purchases or picked up the lumber, nor did he testify to any basis for knowing that the lumber was taken to the Church Project (as opposed to other projects) and used specifically for the basement framing work.

[116] Austin Green could not recall if lumber for the basement framing was supplied by Osmi Homes or if he ordered it himself. He confirmed that he did not order the lumber identified in the Canada Tool Supplies Ltd. invoices, although believed he probably requested the material. He testified that the Rona receipts were for materials that he or his workers picked up for the Church Project, which he believed he would have separately submitted to Osmi Homes for reimbursement. He could not say where any of the purchased lumber was used, although in re-examination was able to confirm that some of the Rona receipts related to lumber used for the basement. When asked if he would have ordered lumber in July for work in October, Mr. Green confirmed that he could not answer that, since the invoices showed a small amount of lumber that “could have been be for anything.” He indicated that the quantity of lumber in the Canada Tool Supplies Ltd. invoices would not have been for a basement, since a basement would have required larger amounts of lumber. That led him to ask examining counsel if there was another section with building materials.

[117] Given Mr. Green’s uncertainty regarding where lumber purchased in August was used, I accept the argument made by Mr. Kingrani that it would have been needed for other construction purposes. I also accept Mr. Green’s testimony and find that the Rona receipts represent purchases made and paid for by Future World. Mr. Green testified that these would have been submitted to Osmi Homes, but there is no evidence from Osmi Homes that any lumber purchased by Future World was separately invoiced by Future World or reimbursed by Osmi Homes. I accordingly find that the cost of the lumber purchased from Rona was included in the framing subcontract price paid by Osmi Homes to Future World.

[118] Mr. Jhaveri’s evidence does not support any basis for personal knowledge that the lumber purchased in October from either Canada Tool Supplies Ltd. or Home Depot was supplied specifically for basement framing. Mr. Green did not testify regarding the receipt from Home Depot, but his evidence on the Rona receipts contradicts Mr. Jhaveri’s evidence that Osmi Homes purchased all lumber in the invoices and receipts. In my view, the evidence does not support a finding that the lumber reflected in the Canada Tool Supplies Ltd. and Home Depot receipts from October was material used for basement framing at the Church Project.

[119] Osmi Homes has failed to satisfy its onus to demonstrate that, on a balance of probabilities, the invoices and receipts for lumber purchases were additional material costs actually incurred by Osmi Homes in respect of basement framing. I accordingly find that there is no valid claim for any extra regarding these material costs.

vii. Soffits and eaves

[120] I have already found that supply and installation of standard soffits, eaves and downspouts formed part of Osmi Homes’ base contract scope of work. There is no dispute that only standard soffits, eaves and downspouts were installed. No evidence supports any change in the work, such as upgraded materials at a higher cost. I accordingly find no basis for Osmi Homes to claim an extra regarding this work.

viii. Metal cap over the front porch

[121] I have already found that supply and installation of the copper roof assembly depicted on the permit drawings was included in the base contract scope. I have also found that the parties agreed to substitute the cap material from copper to a less expensive metal. However, that change in material was to the benefit of Osmi Homes. Osmi Homes’ actual cost of supplying the less expensive metal cap would be a net savings in its actual costs of construction. There is accordingly no basis for any extra. While there may have been a basis for Mr. Kingrani to argue entitlement to an abatement in the contract price, no such abatement was argued and no evidence was tendered supporting any discussion of or agreement to abatement.

[122] Although unnecessary to disposition of Osmi Homes’ claimed extra for the metal cap, even if I had found the work constituted an agreed extra, I would nevertheless find that Osmi Homes has failed to meet its onus of proving the value of services and materials supplied. Mr. Jhaveri’s evidence is that he paid the manufacturer and installer for the metal cap, but cannot locate the invoices. The billing to Mr. Kingrani is said to be based on Mr. Jhaveri’s notes, but no such notes were presented at trial. Neither the manufacturer nor installer were called as witnesses and nothing was tendered in evidence suggesting that Osmi Homes made any attempt to obtain the invoice(s) directly from the manufacturer and installer, who were not even identified. During his cross-examination, Mr. Jhaveri was specifically asked to identify the relevant installation contractor, but could not. He testified that he had met the contractor for the first time on this job and paid him, although acknowledged he had no invoices or proof of payment. When asked if Mr. Jhaveri had lost contact with the contractor, he testified that, after this job, he “didn’t find him.”

[123] Given my findings regarding reliability and credibility of Mr. Jhaveri’s evidence, I would not have accepted Mr. Jhaveri’s evidence on the amounts paid for manufacturing and installing the metal cap without corroboration, which Osmi Homes did not tender.

ix. As-built survey costs and engineering reports

[124] I am not satisfied that Osmi Homes has met its evidentiary onus to demonstrate that the following payments purportedly made on behalf of Mr. Kingrani are either legitimate or compensable extras:

(a) a deposit paid to Mandarin Surveyors on April 6, 2015 in the amount of $1,130 for its survey services, which were subsequently invoiced by Mandarin Surveyors in its invoice dated October 1, 2015 for $1,582, including HST;

(b) payment of Mandarin Surveyors’ invoice dated April 1, 2015 for $282.50, including HST, to prepare a survey plan, which was paid by cheque dated April 10, 2015;

(c) payment of LHW Engineering Ltd.’s invoice dated April 16, 2015 for $395.50, including HST, for an engineering report, which was paid by cheque dated April 17, 2015; and

(d) payment of LHW Engineering Ltd.’s invoice dated April 28, 2015 for $300, including HST, for an engineering opinion purportedly required by the City, regarding which no details were put in evidence, which was paid by cheque dated May 23, 2015.

[125] Firstly, I am unable to find on Mr. Jhaveri’s uncorroborated evidence that the surveys and engineering reports were required for construction to continue or that their unavailability caused any delay to the project as stated by Mr. Jhaveri. No evidence was tendered on why they were required, who specifically advised Mr. Jhaveri that they were required, or what specifically they entailed. For example, I was directed to no statutory or other authority for a City requirement for the as-built foundation survey purportedly obtained from Mandarin Surveyors.

[126] Secondly, even assuming the surveys and engineering reports were required, I do not agree with Osmi Homes’ interpretation of the contract that Mr. Kingrani was responsible for obtaining and submitting them. In my view, obtaining and providing an as-built foundation survey or engineering reports are not reasonably interpreted as falling within item #3 under “Owner’s Responsibility” in the contract, which states, “All city inspection and city charges or any deposits for the property will be Owners responsibility”. They are not City inspections, City charges, or deposits for the property. At best, fees were paid by Osmi Homes to third parties in order to satisfy construction requirements. However, nothing in the contract or evidence supports that it was reasonably understood by the parties that Mr. Kingrani had responsibility to confirm that Osmi Homes’ work had been properly performed before construction could continue. In my view, clear contractual language would be required to make an owner responsible for verifying compliance of a contractor’s work with construction requirements. There is no such term in the contract.

[127] Thirdly, I find that Mr. Jhaveri’s evidence on these payments lacks credibility for a number of reasons, including the following:

(a) Despite alleging that Mr. Kingrani retained the surveyor and engineer, none of the invoices are addressed to him. The October 1, 2015 invoice from Mandarin Surveyors has no addressee, while the April 1, 2015 invoice indicates “To:” but is blank beside it (although Mr. Jhaveri denied in cross-examination that he had redacted the addressee). Both invoices from LHW Engineering Ltd. are addressed to Om Sai Marble Inc., a company controlled or operated by Mr. Jhaveri.

(b) Despite evidence in Mr. Jhaveri’s first affidavit that LHW Engineering Ltd.’s engineering report was required by the City before work could proceed, the related invoice was rendered and paid by Osmi Homes at a point when it appears that demolition and excavation had only recently been completed. No evidence was given regarding what “as-built” condition required an engineering report at that stage of construction or what efforts were made to have Mr. Kingrani arrange the report if it was his contractual responsibility.

(c) Osmi Homes elected to tender no corroborating testimony or documentary evidence for Mr. Jhaveri’s evidence. No representative from either Mandarin Surveyors or LHW Engineering Ltd. was called as a witness to testify on who retained them, the work performed, or the need for that work. The City’s building inspector was not called to corroborate Mr. Jhaveri’s evidence that the surveys and reports were required before the City would allow construction to proceed. The surveys and reports themselves were not tendered into evidence at trial. Mr. Jhaveri gave evidence that he did not retain copies when they were filed with the City, but there is no evidence of any efforts to obtain them from the City, the surveyor, or the engineer.

(d) I prefer the evidence of Mr. Kingrani that he had no contractual relationship with Mandarin Surveyors or LWH Engineers Ltd. regarding the subject survey work and engineering reports, and that he had no discussions with Mr. Jhaveri regarding them. There is a complete absence of any corroborating evidence for Mr. Jhaveri’s testimony. I do not accept that Mr. Jhaveri’s email dated October 6, 2015, in which Osmi Homes’ list of work included, “Waiting for the Survey, without which further work of Insulation and Drywall cannot proceed”, supports any finding that Mr. Kingrani had knowledge of the requirements and his responsibility for the surveys and engineering reports. When pointed to that email in cross-examination, Mr. Kingrani credibly testified that he did not understand what it meant and that he understood the email was sent by Mr. Jhaveri in response to his requests for explanation of delays in the job.

[128] Timing of the claim for extra is also significant. Notwithstanding that each payment was made in April or May 2015, these claimed extras were not charged to Mr. Kingrani until April 12, 2016, by which time Osmi Homes had purportedly completed all of its work and the payment dispute had already arisen. The four invoices post-date Osmi Homes’ claimed date of last supply on April 9, 2016 and were issued two days prior to registration of the claim for lien on April 14, 2016. I do not accept Mr. Jhaveri’s testimony that, because the payments were small amounts, he did not want to bother Mr. Kingrani at the time, but once the dispute was going to litigation he invoiced all amounts owing under the contract. The delayed invoicing is conduct more consistent with Osmi Homes having viewed these costs as part of its own scope of work, and then seeking to recharacterize them as extras in retaliation once the relationship had broken down.

[129] I accordingly find that the survey and engineering costs were incurred by Osmi Homes in the ordinary course of construction, not as extras, and are properly included in the base contract price.

x. Priming interior walls

[130] Priming of interior drywall was performed by Osmi Homes. The “Scope of Work” schedule does not include any painting work and clearly states, “Drywalls including taping and mudding ready for priming”. In his affidavit evidence, Mr. Kingrani acknowledges that the contract requirement was for drywall to be “ready for priming” and states his understanding that he was responsible for painting. Nevertheless, during cross-examination, Mr. Kingrani testified that priming was included in the contract, since Osmi Homes did not expressly exclude it. In my view, the contract is unambiguous that all drywall was to be “ready for priming”, not primed.

[131] Evidence from Mr. Jhaveri and Mr. Kingrani is in conflict regarding whether Mr. Kingrani requested priming work. However, I need not determine whether Mr. Kingrani instructed Osmi Homes to prime the walls. On January 15, 2016, Mr. Jhaveri sent pictures to Mr. Kingrani by text message showing the priming work in progress. Osmi Homes argues that, at a minimum, Mr. Kingrani acquiesced in the extra. I agree. Mr. Kingrani was aware the work was proceeding, yet did not object to Osmi Homes performing it. In my view, even if Mr. Kingrani subjectively believed he would not be charged for the extra, either because he erroneously believed it was included in the contract or because Mr. Jhaveri had said he “needed” to do that work, that belief was not reasonable. Given the unambiguous contract language, a reasonable owner in Mr. Kingrani’s position would not interpret the contract to include priming work nor expect a contractor to gratuitously perform extra work that the owner knows is proceeding. I accordingly find that Mr. Kingrani at least impliedly agreed to the extra by his acquiescence during performance of the work.

[132] Osmi Homes claims $3,955 for priming the interior walls, comprised of the price to purchase primer, the amounts paid to Osmi Homes’ painting subcontractor, plus a 20% markup for ordering primer and supervising the painting work. Mr. Jhaveri’s evidence is that Osmi Homes purchased the primer from Markham Colours & Decor Ltd. and the painting work was performed by Victor Guevara. Mr. Guevara was not called as a witness.

[133] Osmi Homes has not satisfied its evidentiary onus regarding proving its cost of primer. The invoice for primer post-dates both Mr. Guevara’s invoice for priming work and the cash payment receipt signed by Mr. Guevara. During cross-examination, Mr. Jhaveri’s self-serving testimony was that the primer was bought earlier, and that Markham Colours & Decor Ltd. invoiced after the fact because Osmi Homes has an account there. Mr. Jhaveri testified that the primer was purchased and applied in January, but not invoiced until the end of February. However, Mr. Jhaveri confirmed that he did not collect the primer himself. Rather, his “guy” went to pick up the primer after his spouse had called Markham Colours & Decor Ltd. Neither were called as witnesses. Mr. Jhaveri provided no evidentiary basis to support personal knowledge that the same primer was used at the Church Project.

[134] Although Mr. Guevara was not called as a witness, the authenticity of his invoice and the related payment receipt were not challenged. The receipt notes payment for “Priming work (labour and stuff)”. No explanation of “stuff” was provided. Since I do not accept that the invoice from Markham Colours & Decor Ltd. has been proven to be in respect of priming paint for the Church Project, I find that “stuff” includes primer, and that the amount charged by Mr. Guevara of $2,825 represents a reasonable amount for the work performed from which to assess the value of the extra.

xi. Winter heating costs

[135] Osmi Homes claims $2,825 for propane heating costs resulting from construction extending into the winter months. Osmi Homes argues that Mr. Kingrani’s changes to Osmi Homes’ scope of work and the delay in providing required surveys and engineering reports to the City pushed the Church Project into the winter, which required Osmi Homes to incur costs for winter heating until the furnace was installed. I am not satisfied that argument is supported by the evidence for several reasons, as follows:

(a) As outlined above, I have found that Osmi Homes has failed to establish the need for the as-built foundation survey and engineering report and opinion and, further, that obtaining them was Mr. Kingrani’s responsibility. It follows that Mr. Kingrani is not responsible for any delay associated with them. However, even if I had accepted Osmi Homes’ position, the alleged delay is entirely unsubstantiated by the evidence. No witness was called and no evidence was tendered by Osmi Homes to corroborate Mr. Jhaveri’s statements that the Church Project was in any way impeded from proceeding.

(b) Duration for construction of the Church Project was agreed at six months, to be completed by September 30, 2015. If construction had been completed by that time, heating should not have been necessary. There is no evidence on when the furnace was delivered, installed and operational. Also, no testimony or evidence addresses why the building enclosure could not have been completed and why the furnace could not have been installed prior to the cold weather.

(c) The only evidence addressing when the house was enclosed is the “critical path chart” appended to Mr. Jhaveri’s first affidavit. It indicates that the building was enclosed and insulated by November 6, 2015. Completion of soffits is the only work post-dating completion of insulation that appears relevant to the building enclosure. The “critical path chart” indicates that soffits and eaves were installed between January 15 and February 5, 2016. To the extent that the installation of soffits was required to complete the enclosure, which is unclear on the evidence, there is no evidence supporting why that work was not or could not have been done sooner.

(d) No evidence supports that notice was given to Mr. Kingrani or that he had knowledge regarding winter heating costs being incurred by Osmi Homes that would be charged to Mr. Kingrani as an extra. There is accordingly no evidence supporting any express or implied agreement to an extra.

[136] In addition to the foregoing, effective cross-examination of Mr. Jhaveri cast doubt on the reliability of propane invoices, with several appearing to clearly pre-date work on the Church Project. Authenticity of rental invoices tendered by Osmi Homes was also challenged on the basis that they have been altered from their original form. Mr. Jhaveri was cross-examined on the variances and was unable to provide an explanation, but denied that he or Osmi Homes’ staff altered the invoices. However, since the evidence tendered by Osmi Homes does not substantiate a need for winter heating attributable to any act or omission of Mr. Kingrani, I need not address the authenticity of these invoices.

[137] In my view, Osmi Homes has failed to meet its onus of proving the need for, agreement to, or price of heating costs. I accordingly find that heating costs do not constitute a valid or compensable extra.

xii. Generator gas costs

[138] Osmi Homes claims $5,650 for gasoline allegedly purchased to run an electrical generator, which Mr. Jhaveri indicates was required in the absence of Mr. Kingrani having made arrangements for temporary power to the site during construction. Mr. Kingrani disputes that he was ever told he was responsible to provide Osmi Homes with an electrical generator and gas to fuel it. It appears undisputed that Mr. Kingrani did supply a generator for use by Osmi Homes.

[139] For the following reasons, I have determined that Osmi Homes’ evidence on the claimed costs is unreliable and unverifiable. I accordingly find that Osmi Homes has not proved that the claimed costs were actually incurred in respect of the Church Project. Determinations on whether Mr. Kingrani was contractually required to supply temporary power during construction and whether he expressly or impliedly agreed to an extra for generator gas costs are thereby legally moot.

[140] Despite claiming $5,650, Mr. Jhaveri’s affidavit states the he was “only able to locate invoices which total to the sum of $5,227.97.” A total of 78 pages of supporting documents were tendered, comprised of a two-page summary chart followed by a series of gas invoices, invoices from Future World, and cheques supporting proof of payment to Future World. The invoices are not totalled in the summary chart, but do not appear to total the $5,227.97 figure identified in Mr. Jhaveri’s affidavit. No evidence was tendered demonstrating how the $5,227.97 figure was reached. Neither Austin Green’s affidavit nor his viva voce testimony addressed the gas purchases reflected in Future World’s invoices.

[141] Mr. Kingrani challenges the receipts, notably the volume of gasoline shown as being purchased in many receipts. While a number of receipts show smaller volumes of gasoline, such as 18.963 litres, 20.575 litres, and 11.384 litres, there are a number of receipts showing substantial volumes of gasoline, such as 101.443 litres, 106.579 litres, 96.169 litres, 98.568 litres, and 94.897 litres. Mr. Kingrani argues that these represent gas receipts from filling vehicles for use, not for use in the generator. Certain receipts also include items that clearly have nothing to do with gasoline, such as drinks, cigarette packs and lottery tickets. At least one receipt includes a purchase of engine oil. Another receipt is for $450 in diesel fuel, which is at odds with the other receipts for gasoline. There is no evidence on the reason for a diesel fuel purchase. One receipt was shown to be dated a few days after the contract was signed. Mr. Jhaveri dismissed the entries for drinks, cigarettes and lottery tickets as his contractors trying to get something for themselves, and seemed to agree that they were not properly chargeable to the Church Project. Nevertheless, the fact that they form part of the amount claimed by Osmi Homes calls into question the reliability of the accounting work performed in allocating these charges to generator fuel for the Church Project.

[142] Mr. Jhaveri’s evidence is that he relied on his office staff to keep records for each project. Gasoline receipts produced and relied upon in this litigation are those from the subfolder for the Church Project, which he believes were correctly filed. He confirmed that he did not audit the receipts, because he knew their filing was done contemporaneously with work on the project. The responsible office staff were not identified or called as witnesses. Through cross-examination, Mr. Jhaveri was demonstrated to have no personal knowledge of whether these receipts do, in fact, relate to the Church Project.

[143] For these reasons, I find that Osmi Homes has failed to satisfy its evidentiary burden of proving that any of these costs were incurred specifically in respect of fuel purchases necessary to run the generator on the Church Project. I accordingly find that the claimed generator gas costs do not constitute a valid or compensable extra.

xiii. Cold room door

[144] It is undisputed that the supply and installation of a cold room door was excluded from the contract. Mr. Kingrani’s affidavit evidence is that he did not recall Osmi Homes installing the cold room door, and that he did not recall the door being installed on the dates when he visited the house. Conversely, Austin Green’s affidavit states unequivocally that Future World did install the door. He was not cross-examined on that statement. As I have noted, Mr. Green was quite credible. Mr. Green’s unequivocal evidence that the cold room door was installed is not inconsistent with Mr. Kingrani’s inability to recall that the work was done. I accordingly find that the cold room door was supplied and installed.

[145] Osmi Homes has the burden of proving an express or implied agreement to the extra. Mr. Jhaveri’s evidence is that the work was performed at the request of Mr. Kingrani and with his verbal approval prior to the work proceeding. Mr. Kingrani denies that he asked Osmi Homes to supply and install the cold room door, and testified that he had no discussions with Mr. Jhaveri about installing it. Their directly conflicting evidence cannot be reconciled. I was pointed to no evidence corroborating any instruction from Mr. Kingrani or agreement to supply and installation of the cold room door, or the timing of an agreement being reached. Mr. Kingrani denied discussing the cold cellar door with Mr. Jhaveri and, as noted, did not recall it being installed. He was asked few questions about the door during his cross-examination. Having regard to my credibility findings, I prefer the evidence of Mr. Kingrani that the extra was not discussed. I thereby find there was no express agreement to the extra.

[146] There is also nothing in evidence beyond Mr. Jhaveri’s self-serving statements, which I have rejected, supporting that Mr. Kingrani had any knowledge that the cold cellar door was purchased, delivered to the site, or installed. In my view, the evidence accordingly also does not support an implied agreement for Osmi Homes to supply and install the cold room door as an extra.

[147] Since there was no express or implied agreement to the extra, I need not consider the amounts claimed by Osmi Homes for supply and installation of the door. In the absence of such agreement to the extra, it is not compensable.

xiv. Electrical changes – pot lights, outlet relocation, cabinet lighting

[148] Osmi Homes charged Mr. Kingrani $1,600 plus HST for additional electrical work, which is identified in its invoice as an additional 16 pot lights, relocation of refrigerator and microwave points, and undermount kitchen lighting. Notwithstanding the invoice description of the work, Mr. Jhaveri’s first affidavit refers only to additional pot lights and refrigerator and dishwasher outlets, making no mention of undermount kitchen lighting.

[149] Dealing first with the pot lights, I have already found that the contract scope of work included only 100 pot lights. Osmi Homes claims for an extra 16 pot lights. Mr. Jhaveri testified that an additional 16 pot lights were charged based on the actual count of 116 pot lights after installation. I am satisfied from the corroborating evidence of Riaz Ahmed that a total of 116 pot lights were installed. However, I am not satisfied that evidence supports any express or implied agreement by Mr. Kingrani to an extra for additional pot lights. The evidence does not support that Mr. Kingrani was ever made aware that the total number of pot lights being installed would exceed or was exceeding the 100 pot lights provided in the contract. It also does not support any discussion with Mr. Kingrani regarding an extra for additional pot lights being charged prior to the completion of pot light installation.

[150] Mr. Jhaveri testified that Mr. Kingrani was on site giving instructions on pot light locations as they were being installed, and that he must have given directions to Riaz Ahmed. I question the credibility of that self-serving evidence. Mr. Ahmed confirmed during his cross-examination that Osmi Homes had provided Frinz with electrical drawings that identified the locations of pot lights, and that he was also told to add pot lights by Mr. Jhaveri where, for example, some corners may have looked dark. Although he did indicate in re-examination that he had some direct interactions with Mr. Kingrani, that fact is not included in Mr. Ahmed’s affidavit and was never clearly stated during cross-examination. Also, the extent, nature and frequency of any such interactions with Mr. Kingrani was never tendered into evidence.

[151] However, I need not address the existence of electrical drawings nor make a determination on the credibility of Mr. Jhaveri’s evidence. If Mr. Jhaveri’s evidence is accepted, then Mr. Kingrani was at best indicating desired locations of pot lights. In my view, general instructions on desired pot light locations is insufficient to satisfy Osmi Homes’ evidentiary burden. To support a finding that Mr. Kingrani expressly agreed or otherwise assented or acquiesced to an extra for additional pot lights, evidence is required supporting that Mr. Kingrani knew or reasonably ought to have known that additional pot lights were being installed above the 100 pot lights provided in the contract. There is no such evidence. I accordingly find that there was no specific discussion or express agreement regarding any extra for additional pot lights, that Mr. Kingrani did not know nor ought to have known that additional pot lights were being installed, and that there was thereby no implied agreement for an extra. The extra is according not compensable.

[152] Given my determination, I need not consider the amount charged. Nevertheless, I would have found that Osmi Homes has failed to establish a reasonable value for the work. Mr. Jhaveri’s evidence that he “learned that the price to supply and to install a pot light is the sum of $91.53 for a total amount of $1,464.48 for 16 pot lights” is unsubstantiated. No evidence was given on how, when or from whom that information was obtained. Although that figure is reflected in handwriting on Frinz’s invoice appended to Mr. Jhaveri’s first affidavit, Mr. Ahmed confirmed it was not his handwriting. Mr. Ahmed also confirmed there was a written subcontract with Osmi Homes, which was not tendered into evidence, and that it included separate pricing for interior and exterior pot lights. Although asked repeatedly during cross-examination, he would not confirm the price agreed with Osmi Homes to supply and install interior pot lights, but did confirm it was much less than the handwritten amount of $81 plus HST per pot light.

[153] Regarding the balance of electrical work charged for relocating refrigerator and microwave outlets and installing under mount kitchen cabinet lighting, Osmi Homes has failed to prove the cost of the work, rendering an assessment of whether the work was expressly or impliedly agreed by Mr. Kingrani legally moot. Mr. Ahmed’s affidavit states his belief “that the pricing of this additional work was fair and reasonable and was not inflated.” However, there is no evidence of the amounts charged by Frinz for the outlet relocation and cabinet lighting work. The invoice tendered as relating to this extra electrical work describes the scope of work as “Electrical works for changing overhead wire connection”. Mr. Ahmed’s affidavit does not discuss the invoice. Cross-examination of both Mr. Ahmed and Mr. Jhaveri quickly demonstrated that the invoice has nothing to do with the extra charged to Mr. Kingrani by Osmi Homes, but rather relates to work to change the electrical service from an underground connection to an overhead connection. That is not an extra charged by Osmi Homes, nor is it identified by Osmi Homes as being claimed in its Scott Schedule or anywhere in its affidavit evidence-in-chief.

[154] It is therefore evident and I find that the invoice is not in respect of additional electrical work to change the location of two outlets and to install cabinet lighting, which is the work identified in Osmi Homes’ invoice as an extra. There is no other evidence supporting a price quoted to Mr. Kingrani, Osmi Homes’ actual cost for the outlet relocation and cabinet lighting work, or a reasonably inferred cost of that work. I accordingly find that Osmi Homes has failed to prove the value of the alleged extra work.

xv. Osmi Homes’ markup

[155] I agree with Mr. Kingrani’s position that, when calculated against pre-markup totals, the actual markup charged by Osmi Homes is not consistently 20% from invoice to invoice, with some invoices having a higher or lower markup. No credible explanation was given by Mr. Jhaveri for charging variant markups for claimed extras. In Mr. Jhaveri’s second affidavit, he states that a 20% markup was discussed with and agreed by Mr. Kingrani. Mr. Kingrani denies any discussion or agreement regarding a 20% markup. There is direct conflict in their evidence. Given the lack of any corroboration for agreement to any markup on extras, and taking into account my credibility findings, I prefer the evidence of Mr. Kingrani. I accordingly find that there was no agreement on any chargeable markup on Osmi Homes’ actual costs of completing extras.

[156] Notwithstanding that there was no agreement to a markup, it would be a commercially unreasonable result to deny Osmi Homes any markup on its actual costs of performing compensable extras for necessary coordination and supervision work. Mr. Jhaveri’s second affidavit suggests that 20% is an “industry normal” markup for labour and material charged by a trade for extra work. I do not accept Mr. Jhaveri’s self-serving evidence. By his own evidence, he had never worked for a client prior to the Church Project and had only previously performed construction on his own projects. It is thereby unclear on what experience Mr. Jhaveri bases his opinion on markups. I accordingly give no weight to his views on industry norms. No other evidence was tendered on the quantum of a standard contractor markup in Ontario home renovation and construction.

[157] In my view, absent evidence on standard contractor markup rates in home construction, but given the commercial unfairness to Osmi Homes of denying it any markup, I find that a commercially reasonable markup on extras in the circumstances of this case is 10% of the actual costs of services and materials.

c. Amount owing to Osmi Homes before payments and set-offs

[158] Osmi Homes substantially completed its contract work, and acknowledges that it did not supply or install the required air conditioning unit and did not install toilets. A credit memo dated April 12, 2016 was issued in the amount of $3,000 plus HST for that incomplete work. Mr. Kingrani has not accepted the credit and instead claims for actual costs incurred in supplying and installing the air conditioning unit and toilets. The parties agree that Mr. Kingrani is not entitled to both the credit given by Osmi Homes and the related set-off claimed by Mr. Kingrani. Subject to any adjustment arising from assessment of Mr. Kingrani’s set-off claim, I have applied Osmi Homes’ credit against allowed claim amounts.

[159] Before accounting for payments made and proven set-offs, the amount owing to Osmi Homes on account of its supply of services and materials, including compensable extras, is $578,995.50. Since alleged incomplete work is minor in nature, and addressed further below with Mr. Kingrani’s set-offs, that figure is calculated from the amounts actually billed by Osmi Homes with reference to the amounts in the “Progress Payment” schedule, less a de minimus overcharge to the agreed contract price, plus allowed extras, less the credit given by Osmi Homes, as follows:

Base Contract Work Demolition and excavation (Invoice no. 1024) $ 17,613.75 Backfill and underground drainage (Invoice no. 1025) 40,260.00 Footings/foundations (Invoice no. 1026) 40.260.00 Lumber delivery (and structural steel) (Invoice no. 1027) 62,906.25 First and second floor structure (Invoice no. 1028) 40,260.00 Roof ply (Invoice no. 1029) 35,277.50 Shingles and windows (Invoice no. 1030) 60,390.00 All rough-in (Invoice no. 1031) 60,390.00 Insulation (Invoice no. 1038) 20,130.02 Drywall delivery (Invoice no. 1039) 20,130.02 Drywall installation (Invoice no. 1040) 20,130.02 Mud and tape (Invoice no. 1042) 20,130.02 External stone wall (Invoice no. 1033) 35,227.50 External brickwork (Invoice no. 1032) 30,195.00 Subtotal $ 503,250.08 Less: Base contract overbilling - 0.08 Total Base Contract Work $ 503,250.00

Allowed extras Basement framing $ 8,500.00 Priming 2,500.00 Subtotal $ 11,000.00 Allowed markup (10%) 1,100.00 Total Allowed Extras $ 12,100.00

Amount owing Total Base Contract Work $ 503,250.00 Total Allowed Extras 12,100.00 Less: Credit for a/c and toilets - 3,000.00 Subtotal $ 512,350.00 HST 66,605.50 Total amount owing (before payments and set-offs) $ 578,995.50

d. Payment terms and manner of payment

[160] Another disputed issue is accounting of payments made on account of the Church Project. The parties dispute the payment terms of the contract, when Osmi Homes’ invoices were rendered to Mr. Kingrani, if certain payments were made at all, and the accounting of payments, including allocation of payments and loan credits as between the Church Project and the Wellington Project. Payments to Osmi Homes were made in one of three manners:

(a) payments directly from Mr. Kingrani;

(b) payment credits in satisfaction of loan debts owed by Mr. Jhaveri; and

(c) payments to Osmi Homes from third parties on behalf of Mr. Kingrani, some of whom are said by Mr. Kingrani to have been loan debtors making payments directly to Osmi Homes on Mr. Kingrani’s behalf rather than paying Mr. Kingrani.

[161] Each party prepared a separate accounting of payments on the Church Project outlined in charts appended to their affidavit evidence. Mr. Kingrani’s position on payments is set out in an updated Scott Schedule of payments appended as Exhibit G to his affidavit (the “Payment Scott Schedule”). Osmi Homes’ initial trial position on payments was set out in a chart appended as Exhibit X to Mr. Jhaveri’s first affidavit, but that accounting was revised in response to the Payment Scott Schedule in a further chart appended as Exhibit D to Mr. Jhaveri’s second affidavit.

[162] During closing submissions, Mr. Kingrani submitted that Osmi Homes bears the onus of demonstrating not only its supply of services and materials to the Church Project, but also the contract price that Osmi Homes alleges is outstanding. To the extent that Mr. Kingrani suggests that Osmi Homes has an evidentiary burden to prove payments, in my view, that is not a correct statement of law. Once a debt has been established by a contractor, the onus shifts to the owner to demonstrate that payment of the debt has been made or that the debt is not payable by reason of set-offs or on some other basis. It is accordingly Mr. Kingrani’s evidentiary onus to demonstrate that disputed payments or credits were actually paid or should be credited.

[163] Before addressing my assessment of payments, I address the contractual payment terms and findings on when Osmi Homes’ invoices were rendered, the weight to be given to monthly progressive payment detail summaries tendered by Osmi Homes, and the extent of relevant loan-related payment credits.

i. Payment terms and timing of invoices

[164] Mr. Jhaveri’s evidence is that Osmi Homes rendered invoices in accordance with the “Progress Payment” schedule to the contract. Statements are alleged to have been provided to Mr. Kingrani on a monthly basis setting out the amounts paid during that month and attaching applicable invoices. However, that package form is not the form in which invoices and statements were tendered at trial, nor was it apparently how they were produced during discoveries in the litigation.

[165] Osmi Homes’ invoice amounts do closely correlate to the “Progress Payment” schedule amounts. However, Mr. Kingrani’s evidence is that he received no invoices from Osmi Homes until October 6, 2015, some six months after Osmi Homes commenced work on the Church Project, but had nevertheless been making payments because Mr. Jhaveri had been asking for money and, since Mr. Kingrani was going regularly to the property, he knew work was progressing. He also knew he would be paying Osmi Homes an aggregate of approximately $1 million for both the Church Project and the Wellington Project.

[166] On October 6, 2015, an email was sent by Mr. Jhaveri attaching all of Osmi Homes’ invoices to that date. The email states, “Invoices are attached here.” Mr. Kingrani argues this is the first time he received any of these invoices. According to Mr. Jhaveri, the invoices attached to the email were re-sent following Mr. Kingrani’s request for a copy of all invoices “to enable him to present them to a lender to show the work that had been performed to enable the lender to justify the value of property with construction completed and the amount of the construction mortgage.” He maintained in cross-examination that the invoices had previously been provided to Mr. Kingrani. Mr. Kingrani responded to the email by stating, in part, “you [sic] invoices are not acceptable. please visit my office and discuss, i didnt ask you money for 24% interest from you.” During cross-examination, Mr. Kingrani confirmed that he was objecting to the 24% interest on overdue accounts noted on the invoices, which is consistent with having only seen the invoices for the first time on October 6, 2015.

[167] To support that invoices were provided earlier than October 6, 2015, Osmi Homes relies heavily on a text message from Mr. Kingrani on July 31, 2015 stating, “Pls keep the invoices in ur car. May b we meet today so I collect from u,”. Mr. Kingrani testified that he did not know to which invoices he was referring in the text message, and that it could well have been invoices from the Wellington Project.

[168] I accept Mr. Kingrani’s evidence that Osmi Homes’ invoices were not provided until October 6, 2015. The only corroboration for Mr. Jhaveri’s evidence that they were provided earlier is the July 31, 2015 text message, which I find is not clearly in respect if invoices on the Church Project. It also suggests multiple invoices were to be delivered, which seems contrary to Mr. Jhaveri’s evidence that each invoice had been hand delivered monthly.

[169] Payments were not made in accordance with either payment provision in the­ contract. Mr. Kingrani testified that was because Osmi Homes received $106,000 at the outset and neither party asked for payments to be made in accordance with the contract. Emails were sent by Mr. Kingrani in January 2016 and March 2016 expressing confusion over accounting on the two projects and seeking Osmi Homes’ position on how much it had received and how much work remained. No evidence supports that Mr. Jhaveri provided his own accounting prior to Osmi Homes registering its lien.

[170] I find that neither party requested or expected compliance with either payment provision of the contract, and that there was legitimate confusion by Mr. Kingrani over payment accounting to which Osmi Homes did not respond. I find that the parties, by there conduct, agreed not to be bound by the formal payment terms of the contract.

ii. Progressive payment detail summaries

[171] In his affidavit evidence, Mr. Jhaveri put forward monthly progress payment detail summaries for both the Church Project and the Wellington Project, which he testified were handed to Mr. Kingrani personally each month. These summaries, each of which are signed by Mr. Jhaveri, outline payments that Mr. Jhaveri acknowledges having received and indicate payment allocations to the Church Project consistent with Osmi Homes’ position. Osmi Homes argues that Mr. Kingrani was accordingly aware of the payments acknowledged by Osmi Homes and payment allocations made throughout the course of construction on the Church Project.

[172] The authenticity of these monthly progressive payment detail summaries was challenged by Mr. Kingrani, who testified that he was never given any of them. Mr. Jhaveri gave evidence that they were prepared by his office at the end of each month, but did not identify who prepared them. He testified that he signed them and that he gave them by hand to Mr. Kingrani. The copies tendered in evidence bear Mr. Jhaveri’s signature. He did not explain when or how they were created, including whether or not they were duplicate originals retained by Osmi Homes (in which case the originals were not tendered at trial) or were photocopies from the originals that were purportedly provided to Mr. Kingrani and, if so, who made the photocopies. On the totality of the evidence, I am not satisfied that Osmi Homes has proven the authenticity of these documents.

[173] In any event, credibility of Mr. Jhaveri’s evidence is squarely engaged by Mr. Kingrani’s unequivocal denial that he received the progressive payment detail summaries. There is no evidence corroborating Mr. Jhaveri’s testimony, such as contemporaneous emails attaching the summaries or testimony from the unidentified office staff member who prepared them. Taking into account my credibility findings, I accept Mr. Kingrani’s evidence that the monthly progressive payment detail summaries were not given to him as alleged by Mr. Jhaveri, and find accordingly.

[174] Since authenticity has not been proven, and I have in any event found that they were not provided to Mr. Kingrani, I have not considered them in determining what payments were actually made and what allocations were agreed.

iii. Loan-related payment credits

[175] Limited evidence was tendered regarding loans made to Mr. Jhaveri by Mr. Kingrani through his company. With the exception of one example promissory note, neither party put forward clear evidence on when loans were made to Mr. Jhaveri, in what amounts, and on what terms. Evidence was also in conflict regarding loan payment credits on the Church Project and the Wellington Project, and was also unclear on whether such credits included accrued interest. Inconsistencies between evidence at trial and the accounting presented by both parties has made it necessary to review all loan payment credits.

[176] Mr. Kingrani’s affidavit adopts the Payment Scott Schedule as being “true and accurate.” The Payment Scott Schedule notes a total of $190,000 in loans at item nos. 1-7. None of these loans are disputed by Osmi Homes, although Osmi Homes does dispute Mr. Kingrani’s accounting of payment credits related to them. Item no. 11 is not noted as a loan payment credit, but Mr. Kingrani acknowledged in cross-examination that the $106,000 payment does relate to loans that he believes are separate loans from those listed at item nos. 1-7. There are two additional cash loans not listed in the Payment Scott Schedule, but which are identified in a loan repayment receipt signed by the parties: one for $11,000 given on June 10, 2014 and another for $20,000 given on July 3, 2014.

[177] Having considered the evidence, I find that nine loans totalling the principal amount of $221,000 were advanced that are relevant to payment accounting on the Church Project, as follows:

(a) a loan by cheque dated October 10, 2013 for $25,000, undisputed by Osmi Homes and listed at item no. 1 of the Payment Scott Schedule (seemingly cheque no. 0103 referenced in a disputed letter from Mr. Jhaveri dated July 31, 2015, although that correlation is not entirely clear from the evidence);

(b) a loan by cheque dated February 27, 2014 for $30,000, undisputed by Osmi Homes and listed at item no. 2 of the Payment Scott Schedule (seemingly cheque no. 0156 referenced in Mr. Jhaveri’s letter of July 31, 2015, although that correlation is not entirely clear from the evidence);

(c) a loan by cheque dated February 27, 2014 for $15,000, undisputed by Osmi Homes and listed at item no. 3 of the Payment Scott Schedule (seemingly cheque no. 0157 referenced in Mr. Jhaveri’s letter of July 31, 2015, although that correlation is not entirely clear from the evidence);

(d) a loan by cheque dated February 27, 2014 for $15,000, undisputed by Osmi Homes and listed at item no. 4 of the Payment Scott Schedule (seemingly cheque no. 0158 referenced in Mr. Jhaveri’s letter of July 31, 2015, although that correlation is not entirely clear from the evidence);

(e) a cash loan on June 10, 2014 for $11,000, confirmed by the first loan repayment receipt signed by the parties;

(f) a cash loan on July 3, 2014 for $20,000, confirmed by the first loan repayment receipt signed by the parties;

(g) a loan by cheque dated September 10, 2014 for $70,000, confirmed by both the promissory note appended as Exhibit H to Mr. Kingrani’s affidavit and the second loan repayment receipt signed by the parties, and listed at item no. 5 of the Payment Scott Schedule;

(h) a loan by cheque dated November 4, 2014 for $25,000, confirmed by the cheque copy appended as Exhibit N to Mr. Jhaveri’s second affidavit and listed at item no. 6 of the Payment Scott Schedule; and

(i) a loan by cheque dated November 4, 2014 for $10,000, confirmed by the cheque copy appended as Exhibit N to Mr. Jhaveri’s second affidavit and listed at item no. 7 of the Payment Scott Schedule.

[178] Loan payment credits for the Church Project and the Wellington Project are identified in the Payment Scott Schedule at item nos. 9-11 and 22, totalling $232,000. That amount exceeds the total principal loans of $221,000. No evidence was tendered by Mr. Kingrani nor any argument made on what constitutes the difference of $11,000. His evidence is that the $101,000 in aggregate loan credits identified at item nos. 9 and 10 of the Payment Scott Schedule relate to the loans identified at item nos. 1-5 and 7, and that the $25,000 payment credit identified at item no. 22 relates to the $25,000 loan identified at item no. 6. No correlation to specific loans was given in evidence for the $106,000 loan payment credit at item no. 11,

[179] Osmi Homes relies on the position set out in the accounting chart at Exhibit D to Mr. Jhaveri’s second affidavit. That shows total loan credits of $207,000, with $132,000 allocated to the Church Project and $75,000 allocated to the Wellington project. The $14,000 difference between the $207,000 in acknowledged loan credits and the $221,000 in principal loans is explained by Mr. Jhaveri in a portion of his letter of July 31, 2015. It purports to outline what comprises the $106,000 payment credit at item no. 11 of the Payment Scott Schedule, which is a payment regarding which Mr. Jhaveri signed a receipt acknowledging the $106,000 payment, but that does not refer to any loans. The authenticity (but not admissibility) of the July 31, 2015 letter was challenged by Mr. Kingrani, who described it as a “fake document” and testified that he did not receive it. The letter states as follows:

In April 2015, you requested us to consider $106000.00 as a part payment for construction of 132 church ave from loan cheques. (cheques #0103, #0156, #0157, #0158, #00040 & #012 = $120000. A balance of $14000 and remaining interest on this loan is paid back separately in cash to you. There is no balance remaining on this loan.).

[180] Mr. Kingrani denies having received the cash payments alleged by Mr. Jhaveri in this letter. No other evidence was tendered by Osmi Homes substantiating or corroborating cash payments of $14,000 plus accrued interest on the loans.

[181] Having considered the evidence, it is clear that item no. 10 in the Payment Scott Schedule does relate to the loan identified at item no. 5. However, I do not accept that item no. 9 relates in any way to the loans identified at item nos. 1-5 and 7. Firstly, item nos. nos. 1-5 and 7 aggregate to a total of $165,000 in loans, whereas item nos. 9 and 10 represent an aggregate payment credit of $101,000. Mr. Kingrani tendered no evidence to explain the variance of $64,000 or where that amount was otherwise credited. Secondly, item no. 9 specifically refers to “Osmi Loan Repayment Receipt, signed by Jhaveri for part payment of $31,000 for Church and Wellington projects”, yet Mr. Kingrani’s evidence fails to address that loan repayment receipt, which expressly identifies the two cash loans from June 10 and July 3, 2014 that are not identified in the Payment Scott Schedule. I find that item no. 9 does not relate to any of the loans identified at item nos. 1-5 and 7 of the Payment Scott Schedule, and instead relates to a loan payment credit identified in the loan repayment receipt signed by the parties regarding the loans from June 10 and July 3, 2014.

[182] The other variance between the positions of the parties is regarding item nos. 11 and 22 of the Payment Scott Schedule. Mr. Jhaveri acknowledges the loan credit for $106,000 at item no. 11, but says the $25,000 credit at item no. 22 is already included in that $106,000 payment credit. As noted above, Mr. Kingrani acknowledged during his cross-examination that the $106,000 was a payment credit for Mr. Jhaveri’s loan debts, although testified that he believed it was in respect of two separate promissory notes from those identified in the Payment Scott Schedule. There is no documentary evidence supporting additional loans totalling $106,000. Mr. Kingrani testified that his photocopies of the relevant cheques were with Mr. Jhaveri and that he had nothing in writing confirming the two promissory notes relating to the $106,000. Through effective cross-examination, Mr. Kingrani was demonstrated to have no recollection of what comprised the $106,000, defending himself on the basis that he did not have his accounting with him. However, there appears to be no accounting of the $106,000 in any evidence tendered at trial. Mr. Jhaveri was not cross-examined on the matter.

[183] Mr. Kingrani’s testimony regarding the existence of two additional loans not included in the loans identified in the Payment Scott Schedule is consistent with the missing two cash loans from June 10 and July 3, 2014. In the absence of evidence supporting any other loans, I find that these are the two loans to which Mr. Kingrani referred during his cross-examination, and that he misconstrued to which payment credit they related.

[184] The result of the foregoing is that, on one hand, Mr. Kingrani claims that $232,000 in loan credits were agreed for the Church Project and the Wellington Project, but he has tendered no explanation for the extra $11,000 in payment credits. On the other hand, Osmi Homes claims that the $221,000 in relevant loans have been satisfied by crediting $207,000 to the Church Project and the Wellington Project, with the balance of $14,000 plus accrued interest on the loans being separately paid. In my view, both parties ought to have put forward clearer loan accounting, including the extent of accrued loan interest and its payment, and better evidence supporting their respective positions on allocation of loans as payment credits, including Mr. Jhaveri’s allegations of separate cash payments on those loans. Nevertheless, I must weigh the evidence that has been tendered. Since the evidence of Mr. Jhaveri and Mr. Kingrani is in direct conflict, credibility has been a factor in my assessment.

[185] I have several difficulties with Mr. Jhaveri’s evidence, including the following:

(a) Mr. Jhaveri would have the court accept that he routinely signed payment receipts and progressive payment detail summaries, yet did not seek any written receipts or confirmation of cash payments for either the $14,000 in principal paid or the payment(s) of accrued interest on the loans;

(b) The two loan repayment receipts in evidence expressly acknowledge that interest on the aggregate $101,000 in principal loans was separately paid. Mr. Jhaveri acknowledges cash payment of interest on the remaining $120,000 in loans, as set out in his disputed letter, but his evidence is conveniently silent on the amount of interest purportedly paid to Mr. Kingrani in addition to the $14,000 loan payment, as well as the payment dates and means of cash payment. There is also no evidence of what, if any, interest on those loans had previously been paid by Mr. Jhaveri. Considering the date and quantum of the loans, the amount of interest accrued to April 1, 2015 (the date of contract execution for the Church Project) would likely be significant, and at a rate of 24% per annum (the interest rate provided in the $70,000 promissory note) could well exceed the unexplained $11,000 in Mr. Kingrani’s evidence;

(c) Mr. Jhaveri’s evidence must also be weighed with regard to Mr. Kingrani’s denial during cross-examination that he received the cash payments. During that testimony, Mr. Kingrani appeared to show genuine confusion at the suggestion that Mr. Jhaveri made a part cash payment of the $120,000 in loans when loans were being credited to the Church Project and the Wellington Project as payments for Osmi Homes’ work; and

(d) Mr. Jhaveri relies solely on his disputed letter for corroboration. In seeking to prove its authenticity, the totality of Mr. Jhaveri’s evidence was to confirm that it was his signature on the letter, that it was prepared around the date of the letter for the purpose of showing Mr. Kingrani the progress of work and outstanding payments for both projects, and that Mr. Jhaveri personally handed it to Mr. Kingrani. Mr. Kingrani denied it was ever given to him. Like the progressive payment detail summaries, Mr. Jhaveri did not explain when or how the copy of the signed letter tendered in evidence was created, including whether or not it was a second original retained by Osmi Homes or if it was a photocopy of the original letter purportedly handed to Mr. Kingrani and, if so, who made the photocopy. I am not satisfied that Osmi Homes has proven the authenticity of the letter. I accordingly give it no weight in my assessment of evidence.

[186] In my view, accepting Mr. Jhaveri’s evidence results in unexplained gaps in loan and credit accounting. Conversely, Mr. Kingrani’s affidavit evidence and testimony is not inconsistent with the evidence on its totality. Evidence tendered by both parties supports that all of the relevant loans were subject to interest, although the only evidence of any agreed interest rate is found in the promissory note tendered regarding the $70,000 loan given on September 10, 2014, which includes a 24% interest term. Since the only evidence of satisfaction of accrued interest is in respect of the loan repayment receipts for the $31,000 and $70,000 payments, I find that it is reasonably inferred from the evidence that unpaid interest had accrued on the remaining $120,000 in loans. I have rejected Mr. Jhaveri’s evidence on cash payment of $14,000 and accrued interest. Although, Mr. Kingrani’s evidence does not expressly address the additional $11,000 credited, I infer and find that accrued interest in that amount remained payable when the subject loans were allocated as payment credits on account of Osmi Homes’ work. Such an inference is consistent with the documentary evidence and allows it to be reconciled with Mr. Kingrani’s evidence in a commercially reasonable manner.

[187] For the foregoing reasons, I prefer the evidence of Mr. Kingrani and find that loan payment credits in the aggregate amount of $232,000, inclusive of accrued loan interest, was agreed by the parties and attributed as payment credits for Osmi Homes’ work on the Church Project and the Wellington Project. The allocation dispute is addressed below.

e. Payments and loan credits

[188] Mr. Kingrani calculates that he paid a total of $586,844 to Osmi Homes, including loan credits. Osmi Homes calculates the aggregate payments and credits to be $441,674. When the positions of the parties on payments and allocation between the Church Project and the Wellington Project are closely reviewed, they are in substantial agreement. As reflected in Osmi Homes payment chart at Exhibit D to Mr. Jhaveri’s second affidavit and verifiable against the Payment Scott Schedule, both parties agree that $415,674 was paid or credited on account of the Church Project. The differences in their remaining respective payment calculations fall into four categories, as follows:

(a) Disputed allocation of payments and loan credits between the Church Project and the Wellington Project, relating to item nos. 9, 10, 14, and 18 in the Payment Scott Schedule;

(b) Alleged double-accounting of a payment, relating to item no. 22 in the Payment Scott Schedule;

(c) Undisputed payments that Osmi Homes denies are related to the Church Project, relating to item nos. 52, 55 and 56 (in part) in the Payment Scott Schedule; and

(d) Payments that Osmi Homes denies were made or received, relating to item nos. 27, 43, 53, 56 (in part), 57, 62, and 64 in the Payment Scott Schedule.

i. Disputed allocations

[189] An agreement was ultimately reached between the parties for payments to be allocated evenly between the Church Project and the Wellington Project. Mr. Kingrani has generally allocated all payments and loan credits on an equal basis, with a few exceptions. Osmi Homes disputes Mr. Kingrani’s allocations of four otherwise undisputed payments and credits.

[190] Item no. 14: On May 7, 2015, a payment was made by cheque in the amount of $10,000 by Mr. Kingrani’s company to Mr. Jhaveri’s company, Om Sai Marble Inc. Mr. Kingrani has credited the full amount to the Church Project, whereas Osmi Homes has credited the Wellington Project. A receipt was signed by Mr. Jhaveri on behalf of Osmi Homes expressly confirming a payment on account of the Wellington Project. Mr. Jhaveri’s cross-examination testimony was that two $10,000 cheques were given in May 2015, and one was attributed to each of the Church Project and the Wellington Project. The signed receipt is unambiguous. Mr. Kingrani testified that he had no recollection of where it was to be allocated, did not know who was right in their allocation, and stated it was up to Mr. Jhaveri to allocate as the receiver of the payment. I accordingly find that the payment is properly allocated in full to the Wellington Project.

[191] Item no. 18: On May 29, 2015, a payment of $10,000 was made by Vatsal Khamar. Mr. Kingrani has credited the full amount to the Church Project, whereas Osmi Homes has credited the Wellington Project. A receipt was signed by Mr. Jhaveri on behalf of Osmi Homes for the payment, but the receipt does not indicate the payment was on account of a particular project (contrary to Mr. Jhaveri’s suggestion in his second affidavit). The evidence on allocation of this payment is less than satisfactory. Mr. Jhaveri’s only evidence is a statement in his second affidavit that Osmi Homes allocated the payment to the Wellington Project, plus a reference in Exhibit F (adopted into his evidence) to a “verbal agreement as explained below” that is not explained. On cross-examination, Mr. Kingrani confirmed that he did not know if Osmi Homes was correct that the payment was to be allocated to the Wellington Project. Given Mr. Kingrani’s uncertainty and Mr. Jhaveri’s failure to tender cogent evidence of any agreement by Mr. Kingrani to allocate the payment to the Wellington Project, I find that the parties did not specifically agree to have this payment allocated to either project, such that equal allocation is fair and appropriate.

[192] Item nos. 9 and 10: The parties dispute allocation of the loan credits for $31,000 and $70,000. Both relevant receipts state that the loan repayment amounts are attributed as “part payment for the outstanding balance that [Mr. Kingrani] owes to Mr. Hitesh Jhaveri (Osmi Homes Inc.) for the construction contract of 132 Church Ave North York and 492 Wellington Crescent Oakville.” No specific allocation between the projects is indicated.

[193] In Mr. Jhaveri’s second affidavit, he states that the two loan repayment receipts were signed at the same time on November 9, 2015, and that he and Mr. Kingrani verbally agreed to allocate $26,000 of the total loan credits to the Church Project and $75,000 to the Wellington Project. Mr. Jhaveri maintained that evidence during cross-examination. It is entirely uncorroborated. Also, no explanation was provided in either his affidavit evidence or his viva voce testimony for why an uneven allocation for these loan payment credits was proposed or agreed. The only documents indicating such an uneven allocation are the two November 2015 progressive payment detail summaries for the Church Project and the Wellington Project, which I have found were not delivered to Mr. Kingrani. Mr. Kingrani denied having negotiated any such division of the payments during his cross-examination.

[194] During Mr. Jhaveri’s cross-examination, he was challenged that his position on allocation was “concocted” in response to Mr. Kingrani’s allocation evidence. That was denied by Mr. Jhaveri. I am not satisfied that the evidence supports a finding that the position was “concocted”. Nevertheless, the evidence of Mr. Jhaveri and Mr. Kingrani is in direct conflict. In the absence of any corroboration for Mr. Jhaveri’s testimony, and having regard to my credibility findings, I prefer the evidence of Mr. Kingrani. I accordingly find that there was no agreement to uneven allocation and accept Mr. Kingrani’s allocation of the loan credits equally in the amount of $50,500 to each of the Church Project and the Wellington Project.

ii. Double accounting

[195] Item no. 22: I have already found that that relevant loans totalling the principal amount of $221,000 were advanced to Mr. Jhaveri and that $232,000 in payment credits were agreed by the parties on account of principal and accrued interest. It follows from those findings that the $25,000 loan credit is not double accounting as argued by Osmi Homes. The sole remaining issue is allocation. Mr. Kingrani has allocated the credit equally between the Church Project and the Wellington Project. Osmi Homes denied the payment credit at all, which I have not accepted. No alternative argument was made by Osmi Homes for allocation of this loan credit. I thereby find that equal allocation is appropriate.

iii. Payments allegedly unrelated to Church Project

[196] Item no. 52: Mr. Jhaveri acknowledges that a payment of $10,101 was made by Mahesh Patel and Vanita Patel to Osmi Homes, but his evidence is that it had nothing to do with the Church Project or the Wellington Project. Rather, it is said to have been repayment of a loan arranged between Mr. Jhaveri and those individuals in India. No evidence supporting the existence of such a loan arrangement was tendered. Mr. Kingrani’s affidavit of evidence-in-chief contains no evidence on the $10,101 payment, his relationship with the Patels, or why they were making a payment on his behalf. The Patels were not called as witnesses. During cross-examination, he testified that he did not accept it was a personal loan to Mr. Jhaveri, and relied on having the cheque as proof of that statement. Mr. Kingrani further testified that he personally provided the cheque to Mr. Jhaveri with a blank payee.

[197] There is no dispute that the cheque was deposited. An image of the deposited cheque was tendered at trial by Mr. Kingrani. Although that document was not produced in the litigation, Osmi Homes did not challenge its authenticity or admissibility. During Mr. Kingrani’s cross-examination, Osmi Homes’ tendered the version of the cheque produced in Mr. Kingrani’s affidavit of documents. The deposited cheque image includes different handwriting for the payee and an additional handwritten memo stating, “on behalf of Anil Kingrani for 132 Church Ave & 492 Wellington Cres”, which is not included on the copy of the cheque produced in Mr. Kingrani’s affidavit of documents. Mr. Kingrani was questioned about the discrepancies, and testified that he personally provided the cheque to Mr. Jhaveri in the form produced in his affidavit of documents, but with a blank payee. He testified that he subsequently wrote in “Osmi Homes Inc.” on the photocopy when providing it to his counsel for this litigation. Mr. Kingrani testified that he did not write the memo and that he did not know with any certainty who did. He also testified that he received the cheque image from the Patels.

[198] Mr. Jhaveri’s second affidavit does not indicate how the cheque was provided to him. He was not cross-examined on when and from whom the cheque was received or if he wrote the payee and the memo. When Mr. Jhaveri was presented with the deposited cheque image during his cross-examination, he testified that the image was different than the cheque and stated, “it is not written what is written” regarding the memo, which Mr. Jhaveri testified was blank. In giving this testimony, Mr. Jhaveri exhibited genuine and credible confusion at the memo notation.

[199] While the evidence supports a finding that the cheque was cashed by Osmi Homes, insufficient evidence was tendered by Mr. Kingrani to support a finding that, on a balance of probabilities, the cheque was a payment made on behalf of Mr. Kingrani. Since it is Mr. Kingrani’s onus to prove disputed payments, and he has not met that onus, I find that the payment was not on account of the Church Project, in whole or in part.

[200] Item nos. 55 and 56 (in part): Osmi Homes disputes that two bank transfers are related to the Church Project: one on November 27, 2015 in the amount of $3,325 and another on December 9, 2015 in the amount of $3,000. Mr. Jhaveri acknowledges receipt of the transfers to his personal account, but says that both payments were repayment of debts owed to by Deepak Khatri to Mr. Jhaveri. No evidence regarding the details of those debts was tendered.

[201] There is no affidavit evidence or testimony from either Mr. Kingrani or Mr. Khatri suggesting that the $3,325 bank transfer was made by Mr. Khatri. Mr. Jhaveri provided no basis for his assertion in that regard. Regarding the $3,000 bank transfer (and the related cash payment, discussed further below), Mr. Kingrani testified that he instructed Mr. Khatri to pay Mr. Jhaveri because Mr. Kingrani was not in the country, after which Mr. Khatri transferred the money to Mr. Jhaveri’s account.

[202] During cross-examination, Mr. Khatri was specifically asked if he had any money exchanges with Mr. Jhaveri at any time and if he had a personal loan from Mr. Jhaveri in India. Mr. Khatri confidently confirmed that he had never borrowed money or anything from Mr. Jhaveri and never had a personal loan. I accept Mr. Khatri’s evidence, particularly given that Mr. Jhaveri’s self-serving statements that he had loaned money to Mr. Khatri are entirely uncorroborated by any other evidence. Since I do not accept Mr. Jhaveri’s evidence that these bank transfers were repayment of a loan to Mr. Khatri, I find that they were both payments on account of Osmi Homes’ work and are properly allocated equally to both projects in accordance with the agreement of the parties on allocation of payments in effect at the time of these payments.

iv. Payments allegedly not made/received

[203] Mr. Jhaveri denies receiving a number of payments claimed by Mr. Kingrani. In all but two instances, Mr. Jhaveri denies the payments were made at all. In those two instances, receipt of payment cheques is acknowledged, but Osmi Homes argues that the payments were never received because the cheques were never cashed.

[204] Item no. 27: Mr. Jhaveri denies receiving a payment of $32,500 from Vatsal Khamar on June 29, 2015. Mr. Kingrani’s contrary testimony is that he was told by Mr. Khamar by email that the payment was made. That email is not in evidence. A letter dated September 20, 2016, purportedly signed by Mr. Khamar and purporting to confirm that the payment was made, is included among the payment receipts at Exhibit J to Mr. Kingrani’s affidavit. However, Mr. Khamar’s affidavit does not address either the alleged $32,500 payment or the letter. Given my determination that Mr. Khamar’s evidence lacked both credibility and reliability, I have given no weight to his attempt to explain his payments. There is no other evidence corroborating that the payment was made, or even in what form the amount was paid. Mr. Kingrani has not met his onus of proving that this disputed payment was made. I accordingly find that it was not.

[205] Item no. 43: Osmi Homes disputes accounting for a payment in the amount of $10,000 from Navin Patel, for which Mr. Jhaveri signed a receipt acknowledging that he received the payment from Mr. Patel on September 9, 2015. Mr. Jhaveri does not dispute that he signed the receipt. In my view, the acknowledgement of payment is sufficient to satisfy Mr. Kingrani’s evidentiary onus regarding the payment being made. I turn now to Mr. Jhaveri’s evidence on why the payment should not be credited.

[206] Mr. Jhaveri’s evidence is that the payment was by a cheque from Mr. Patel that was never cashed and, accordingly, Osmi Homes did not receive the funds. Mr. Patel was not ultimately called as a witness by Mr. Kingrani and his affidavit evidence has not been considered. There is no dispute that a cheque dated September 4, 2015 from Mr. Patel for $10,000 was given to Mr. Jhaveri. Mr. Jhaveri testified during cross-examination that he found the cheque in a closet drawer after litigation had commenced, and learned it had not been deposited when he checked bank records. He testified that he telephoned Mr. Patel, but that he did not answer the phone. The original, uncashed cheque was tendered in evidence at trial, so I am satisfied that the cheque was not cashed. However, I am not satisfied that Osmi Homes did not receive the funds in another form prior to Mr. Jhaveri signing the receipt acknowledging payment, and I do not accept Mr. Jhaveri’s evidence that Mr. Kingrani was given notice that the funds had not actually been received.

[207] Mr. Jhaveri’s second affidavit states that, after being provided with the cheque, Mr. Patel advised him by text message that he did not have the funds, but confirmed during cross-examination that there was no such text message. Mr. Jhaveri further states that he texted Mr. Kingrani to advise him that Mr. Patel did not have the funds. The text message exchange relied upon, which is between September 1 and 10, 2015, is appended to Mr. Jhaveri’s second affidavit. Neither Mr. Jhaveri nor Mr. Kingrani were specifically cross-examined on the exchange. While the text messages appear at first blush to corroborate Mr. Jhaveri’s evidence, on closer review, I find that they do not.

[208] A text message exchange on September 1, 2015 does corroborate that Mr. Jhaveri advised Mr. Kingrani that he had been told by Navin Patel that Mr. Patel did not have the funds. Payment from Mr. Khamar is thereafter discussed, which seems to correlate with undisputed payments made by Mr. Khamar on behalf of Mr. Kingrani on September 8, 2015. No other text messages after September 1, 2015 refer or clearly relate to Navin Patel. The uncashed cheque from Mr. Patel is dated September 4, 2015. Mr. Jhaveri provided no explanation for why the cheque was post-dated or, if not, how a September 1, 2015 text message could relate to a cheque that had not yet been written. There is also no explanation for why he acknowledged receipt of payment on September 9, 2015, five days after the date of the cheque and eight days after the text message exchange.

[209] While I accept that Mr. Patel’s cheque was not cashed, Mr. Jhaveri’s corroborating evidence for why it was not cashed is a text message pre-dating the cheque date with no explanation for the discrepancy. In my view, he has thereby failed to explain why the payment receipt was signed if funds had not been received. In the absence of such an explanation, I find nothing in the evidence supporting that I should not be treating the receipt as confirming what it says, namely that payment was made on September 9, 2015. There is no evidence after September 1, 2015 corroborating that Mr. Patel did not have the funds to pay Osmi Homes. I accordingly infer that Mr. Patel did make payment to Mr. Jhaveri on September 9, 2015 as expressly reflected in the receipt acknowledged to have been signed by Mr. Jhaveri.

[210] Item no. 53: Mr. Jhaveri denies receiving a $2,500 cash payment from Urmilaben Hazariwala. Since Ms. Hazariwala could not be affirmed and Mr. Kingrani ultimately determined not to call her as a witness, her affidavit is not being considered. Mr. Jhaveri’s evidence that the payment was not made is accordingly uncontested. I find that the payment was not made.

[211] Item no. 56 (in part): In addition to the $3,000 bank transfer on December 9, 2015 discussed above, Deepak Khatri’s affidavit evidence is that he also made a $2,000 cash payment to Mr. Jhaveri on the same date. Mr. Jhaveri denies receiving this payment, since he was in India at the time. To corroborate that he was in India for most of December 2015, Mr. Jhaveri tendered pages from his passport and his flight confirmations. Authenticity of the flight confirmations was challenged, but authenticity of the copies of passport pages was not. Mr. Jhaveri’s passport includes an arrival stamp from the New Delhi airport on December 5, 2015 and a departure stamp from the New Delhi airport on December 29, 2015. No evidence supports that the passport arrival and departure stamps were forged, nor was that argument advanced. Cross-examination did not succeed in casting doubt on the accuracy of Mr. Jhaveri’s evidence. Notably, I accept Mr. Jhaveri’s testimony that he had continued ability to send emails regarding the Church Project from airports and while in India. Also, in my view, the fact that a cheque payable to Osmi Homes was cashed during the period when Mr. Jhaveri was in India is not sufficient evidence to find that he was not actually in India. I accordingly accept Mr. Jhaveri’s evidence, as corroborated by his passport, and find that he was in India between December 5 and 29, 2015.

[212] Mr. Khatri was an honest and forthright witness, but was shown during cross-examination to have no specific recollection of making the cash payment or to whom it was made, guessing he paid it to whoever Mr. Jhaveri had instructed him to pay. Significantly, he explained his difficulty remembering by stating, “he used to call me for small payments: when can I do this, when can I go, when can I do this”. Although the reference to “he” was never specifically confirmed, I understood it to be Mr. Kingrani. Mr. Jhaveri was in India at the time of the alleged payment. Since Mr. Khatri had no specific recollection of making the cash payment, appears to have made regular “small payments” for Mr. Kingrani, and no evidence of another recipient or theory for how the $2,000 was paid was put forward, I find that the cash payment was not made.

[213] Item no. 57: Rajesh Kingrani testified that he had been given $7,000 in cash by his brother to pay to Mr. Jhaveri and met with him in the evening on December 12, 2015. I have accepted and found that Mr. Jhaveri was in India between December 5 and 29, 2015. Effective cross-examination of Mr. Kingrani confirmed that Mr. Kingrani does not know who he met. Mr. Kingrani honestly admitted that he could not remember the face of the person he met, he did not see any identification for the person, and he believed it was Mr. Jhaveri because of his text messages with his brother, which were not in evidence. No document was obtained acknowledging receipt of this payment. While he suggested that Mr. Jhaveri might have sent someone else if he was in India, it was conjecture rather than recollection. Having weighed the evidence, Mr. Kingrani has failed to prove on a balance of probabilities that the payment was made. I accordingly find that it was not.

[214] Item no. 62: In Mr. Kingrani’s accounting, an aggregate of $40,300 is credited for payments purportedly made by Vatsal Khamar, comprised of three payments in the amount of $10,300, $20,000 and $10,000. Mr. Khamar’s affidavit states that the $10,300 payment was made on November 9, 2015, the $20,000 payment was made on December 5, 2015, and the $10,000 payment was made on December 23, 2015. Mr. Jhaveri denies receiving the cash payments for $20,000 and $10,000, since he was in India on the dates those payments are alleged to have been made. Mr. Jhaveri’s evidence is that the $10,300 payment is a cheque that was never cashed, regarding which Mr. Jhaveri testified in cross-examination that he assumed Mr. Kingrani was aware. The original, uncashed cheque was tendered in evidence.

[215] During cross-examination, Vatsal Khamar agreed that his affidavit says, “paid to Mr. Hitesh Jhaveri (Osmi Homes)”, and not paid to someone else. Mr. Khamar had no knowledge or recollection of how the $20,000 payment was made. He testified that, although he could not recall, it must have been by “cash, cheque, certified cheque or email money transfer”, although believed it was by cheque. He testified that he had proof of the payments, yet no such proof of payment was tendered at trial. Mr. Khamar proceeded to testify that he must have made the two payments to Mr. Jhaveri by cash during meetings with Mr. Jhaveri at Mr. Khamar’s home, testifying that Mr. Jhaveri had come to his house “for sure”. When challenged that Mr. Jhaveri was not in Canada at the time, Mr. Khamar testified that it must have been his wife who came. When challenged that Mr. Jhaveri’s wife was also not in Canada, he had no answer, but maintained his testimony that he was certain Mr. Jhaveri came to his house to collect cash, regarding which Mr. Khamar was “110% sure”. He then testified that someone must have been sent to collect the money on December 5 and 23, 2015.

[216] With respect to the cheque, neither Mr. Kingrani nor Mr. Khamar gave any evidence explaining the circumstances around a letter purportedly from Mr. Khamar confirming the payment, which was included with other payment receipts appended to Mr. Kingrani’s affidavit, but is not referenced by Mr. Khamar in his affidavit. Mr. Khamar testified during cross-examination that he believed Mr. Jhaveri had cashed the cheque. When challenged that the cheque had not been cashed, he suggested that if it was not cashed, then Mr. Jhaveri would have collected cash from Mr. Khamar’s house. That evidence morphed into confidence that Mr. Jhaveri had said he did not want to cash the cheque, wanted cash, and that arrangements were then made for Mr. Jhaveri to come to Mr. Khamar’s house for cash, which Mr. Khamar testified “is exactly what must have happened”. Mr. Khamar’s conveniently changing evidence was not credible and I have given it no weight.

[217] The amounts paid by Mr. Khamar were purportedly amounts owed by Mr. Khamar to Mr. Kingrani for loans. Details of those underlying debts are not in evidence, and there is no evidence from Mr. Kingrani confirming that he treated the debts as having been satisfied, in whole or in part. In brief re-examination, Mr. Khamar was asked to confirm that the amounts he paid were credited from amounts owed by Mr. Khamar to Mr. Kingrani. The question was objected to on the basis of relevance, but I overruled the objection. In my view, whether Mr. Kingrani detrimentally relied on the payments having been made is relevant. However, Mr. Khamar did not answer the question. Instead, he testified that he was “pretty sure” Mr. Jhaveri received the money from Mr. Khamar’s company or Mr. Khamar himself totalling the amounts and that there “must be proof and evidence.”

[218] No evidence corroborates that Mr. Khamar made the $30,000 in disputed cash payments, and no evidence that Mr. Kingrani treated Mr. Khamar’s alleged debts as being satisfied, in whole or in part, by the payments. Mr. Kingrani has not satisfied his evidentiary onus. I find that the cash payments were not made.

[219] Regarding the uncashed cheque, Mr. Jhaveri acknowledges that it was given to him by Mr. Khamar, but there is no document signed by Mr. Jhaveri confirming receipt of the payment, as was the case with the similarly disputed payment by Navin Patel. Absent such an acknowledgment of payment, Mr. Kingrani must prove the payment was made. There is no evidence that the $10,300 was “paid” by Mr. Kingrani. The cheque was not cashed and I have not accepted Mr. Khamar’s evidence that it was alternatively paid by cash. Had Mr. Kingrani “paid” the amount by crediting Mr. Khamar on account of an equal debt owed or reimbursing him, there may have been detrimental reliance. However, in my view, the evidence does not support a finding that Mr. Khamar owed that amount to Mr. Kingrani, that the $10,300 was credited as between Mr. Kingrani and Mr. Khamar, or that Mr. Khamar was reimbursed the amount. I accordingly find that the funds were not received by Osmi Homes and that Mr. Kingrani did not “pay” those funds to Mr. Khamar, either by loan credit or reimbursement. I thereby find Mr. Kingrani is not entitled to any payment credit for the amount.

[220] Item no. 64: Mr. Kingrani claims credit for payments totalling $12,927 made by Navin Patel to Mr. Jhaveri on behalf of Mr. Kingrani. The Payment Scott Schedule refers to “Letter dated September 21, 2016 from Patel”, but that letter is not in evidence. Mr. Jhaveri denies receiving the $12,927 either in a series of payments or in a lump sum. Mr. Patel was not ultimately called as a witness, so his affidavit is not being considered. Mr. Jhaveri’s evidence that the payment was not made is accordingly uncontested. I thereby find the amount was not paid.

[221] Taking into account my determinations above, I find that a total of $491,836.50 in payments and loan credits are properly accounted on the Church Project, calculated as follows:

Undisputed payments/credits $ 415,674.00 Item no. 9: Loan repayment credit (50% allocation) 15,500.00 Item no. 10: Loan repayment credit (50% allocation) 35,000.00 Item no. 18: Payment from Vatsal Khamar (50% allocation) 5000,00 Item no. 22: Loan repayment credit (50% allocation) 12,500.00 Item no. 43: Payment from Navin Patel (50% allocation) 5,000.00 Item no. 55: Bank transfer (50% allocation) 1,662.50 Item no. 56: Payment by Deepak Khatri (50% allocation) 1,500.00 Total payments/credits $ 491,836.50

f. Deficiencies and incomplete work

[222] As is common in construction cases, a Scott Schedule was prepared and filed that includes Mr. Kingrani’s allegations of deficient and incomplete work and claimed costs of rectification and completion, as well as Osmi Homes’ responses and positions on those items. Mr. Kingrani’s evidence at trial was generally consistent with the positions in the Scott Schedule, although limited or no evidence was tendered on several items. In addition to items outlined in the Scott Schedule, Mr. Kingrani also gave evidence regarding other alleged deficiencies and incomplete work.

[223] Authenticity of all of documents tendered by Mr. Kingrani in support of his set-offs and counterclaim were challenged by Osmi Homes by way of written notice dated August 1, 2019. Written notices confirming document challenges to authenticity or admissibility that a party was maintaining were required by July 30, 2019. In response to the authenticity challenge, Mr. Kingrani sought to prove the documents through his own brief supplementary viva voce examination-in-chief. None of the original versions of the invoices and other documents were tendered and none of the persons or trades supplying materials or performing the work outlined in the invoices and documents were called to authenticate them.

[224] Since Osmi Homes’ late-served notice of document objections was not in compliance with the ordered deadline, I am prepared to find that the documents are deemed to be authentic. However, had there been no challenge to authenticity of the documents, it would not equate to an admission by Osmi Homes that its work was incomplete or that the alleged completion and rectification work was actually performed. At best, it would be an acknowledgment that the invoices were rendered or the documents were created as purported. It remains Mr. Kingrani’s onus to demonstrate, on a balance of probabilities, that there was incomplete or deficient work, that rectification work was completed, and the value of that work. A finding of authenticity regarding these documents does not lead to any inference that Osmi Homes’ work was incomplete or deficient as alleged.

[225] Invoices and emails tendered by Mr. Kingrani have been tendered both as proof that Mr. Kingrani incurred the charges and also as proof of the truth of their contents, namely the noted work is accurately identified as being deficient and incomplete, that the identified materials were supplied, and that the identified work was performed. As noted, Mr. Kingrani elected not to call any inspectors, suppliers or contractors to testify regarding their observations and completion or rectification work performed. During cross-examination, Mr. Kingrani confirmed that he had proof of payment for the trade invoices, but no such proof of payment was tendered at trial. No photographs of the alleged deficient and incomplete work were tendered, which Mr. Kingrani confirmed during cross-examination he did not take because he did not think taking pictures was necessary while the project was ongoing or that pictures would be needed, since he was not thinking about going to court at the time. I found his evidence on this point to lack credibility considering that all of the invoices post-date registration of Osmi Homes’ claim for lien and many post-date commencement of litigation.

[226] Mr. Kingrani has elected to support his testimony with only supplier and trade invoices, inspection notes and a few emails. The hearsay use of those documents has been a factor in weighing their evidentiary value, particularly since in many cases Mr. Kingrani was demonstrated through cross-examination to have no involvement in purchase of materials or no supervision of work that is the subject of certain invoices.

[227] In addressing the alleged deficiencies and incomplete work, I have referred to the Scott Schedule itemization and noted the amount claimed by Mr. Kingrani for each item. I have generally addressed them in reverse order of magnitude. Additional items not included in the Scott Schedule are then addressed.

i. Porch and exterior wall work - $21,815.94 (Scott Schedule Item No. 9)

[228] Mr. Kingrani alleges that substantial repairs were required to complete and remedy deficiencies in both Osmi Homes’ porch installation work and further exterior work. Mr. Kingrani’s evidence is that the work was performed by Smart Home Solutions, whose invoice in the amount of $21,815.94 was tendered into evidence. During cross-examination, Mr. Kingrani’s counsel confirmed that rear deck work identified in the invoice, totalling $5,340.60 plus HST, was not being claimed. The remaining items, namely front porch soffit and trim, a concrete formed staircase, natural stone capping, limestone stonework repairs, and porch precast and stucco, are claimed.

[229] Other than limited testimony arising from Mr. Kingrani’s cross-examination and Smart Home Solutions’ invoice, no evidence was tendered regarding the alleged deficient and incomplete work. No witness from Smart Home Solutions was called, and the invoice does not indicate who specifically performed the work. Mr. Kingrani’s affidavit contains only general statements that substantial repairs and completion of the front porch work was required and undertaken. Very few of Mr. Kingrani’s own observations were given regarding the issues purportedly rectified by Smart Home Solutions. The invoice has been tendered for the truth that the brief descriptions of work represent work that was necessary and actually performed. That hearsay use has been significant in assessing the weight to be given to the invoice. For the following reasons, I find that it is not a reliable source of evidence on the subject disputed deficiencies, and have accordingly given it limited weight.

[230] As noted earlier in these reasons, Osmi Homes denies it was given notice of deficiencies in its work. The only evidence supporting notice to which the court’s attention was specifically drawn is an email dated April 13, 2016, in which Mr. Kingrani advised Mr. Jhaveri that certain “minor work” was still required. Mr. Kingrani testified he received no response to the email, which was sent one day prior to registration of Osmi Homes’ claim for lien. The email is not particularly specific as to locations or extent of the required “minor work”, stating as follows:

Mr. Jhaveri

as i have sent you email regarding the minor work in pending at church ave

stcko damaged.

stone around the garage door. precost peace on right hand side of one window.

pls let me know, either you can fix it, or i have to get it done.

if u do not get it done in coming week then i will get it fixed

pls reply thanks anilkingrani

[231] The soffit and trim were confirmed to relate to an area behind the precast medallion installed by Osmi Homes that was left rough. Osmi Homes does not dispute the work was not done, but argues it was not part of its scope of work. During cross-examination, Mr. Kingrani acknowledged that the permit drawings do not depict the front porch soffit and trim. Nevertheless, in my view, it would be commercially unreasonable to find that Osmi Homes was not required to install the porch ceiling soffit and trim when it is undisputed that Osmi Homes did install and was required to install the metal porch roof and the remainder of the porch structure, and has further been held responsible to install soffits and eaves for the remainder of the house. I accordingly allow the set-off claim for the cost of that work, being $774 plus HST.

[232] Smart Home Solutions charged $2,322 plus HST for what appears to be supply and installation of a concrete formed staircase at the front porch. Under the heading, “Front Porch Stairs Base”, the description states, “Concrete formed staircase, 4 ft footings, rough finish, to be covered in natural stone capping, 8ft wide, (6) steps total complete”. No evidence or argument from the parties specifically addresses whether the front porch stairs were work within Osmi Homes’ contract scope of work. As already noted, Mr. Jhaveri’s cross-examination testimony was that the porch was not mentioned in the contract because it was part of the foundation wall and cold cellar ceiling. However, Mr. Jhaveri’s second affidavit acknowledges that Osmi Homes “did not install the porch railings as that was not part of the scope of work” and that “Anil Kumar agreed to complete the finishing parts of the construction of a house of which the porch railings and the porch roof were part of his responsibility.” Permit drawing no. A2.3 depicts “landscape steps” from grade to the raised front porch adjacent to the cold cellar wall. Permit drawing no. A3.1, A3.3 and A3.4 depict railings extending down the front porch steps. Since Mr. Jhaveri’s evidence only clearly excluded the railings and the metal cap from Osmi Homes’ front porch work, I infer and find that the porch steps were an undisputed part of Osmi Homes’ contract scope of work.

[233] Evidence on the front porch stairs is less than ideal. There is no evidence from Mr. Kingrani that Osmi Homes did not supply and install the concrete stairs, or completed them deficiently, nor is there any indication in Smart Home Solutions’ invoice that the staircase was understood to be unfinished or deficient. There is also no evidence from Osmi Homes on these points. However, it is Mr. Kingrani’s evidentiary onus to prove his set-off claim and counterclaim. Mr. Kingrani gave no specific evidence on the stairs himself and did not tender any corroborating documents or testimony. Mr. Jhaveri was not cross-examined on the porch stairs. In my view, an invoice for supply and installation of a front staircase does not itself support a proper inference that the front staircase was incomplete or deficient in the absence of corroborating evidence that the staircase was not installed by Osmi Homes or was installed deficiently. I find that Mr. Kingrani has not met his evidentiary onus to establish this set-off claim.

[234] Smart Home Solutions also charged for installing natural stone capping over the front porch and stairs. The permit drawings do not depict natural stone capping, which Mr. Kingrani acknowledged during his cross-examination. Permit drawing no. A1.1 notes only a concrete porch. No evidence has been tendered supporting that natural stone finishing was agreed or reasonably understood to form part of the contract. Mr. Kingrani also tendered no evidence supporting that the natural stone capping installed by Smart Home Solutions was an equivalent to what was agreed or was reasonably expected to be supplied and installed by Osmi Homes pursuant to the contract. I find that Mr. Kingrani has not met his evidentiary onus to establish this set-off claim.

[235] Mr. Kingrani testified that limestone stonework was left incomplete by Osmi Homes. He confirmed that he relies entirely on Smart Home Solutions’ invoice as evidence of improper installation of limestone stonework that required rectification. No photographs were tendered and, as noted, no witness from Smart Home Solutions was called to corroborate the alleged incomplete and deficient work or explain the extent or nature of the issue. Notwithstanding my favourable view of Mr. Kingrani’s credibility, his uncorroborated lay opinion that Osmi Homes’ work was incomplete and deficient is insufficient to satisfy his evidentiary onus.

[236] I similarly find that Mr. Kingrani has failed to meet his evidentiary onus of establishing alleged deficiencies with porch precast and stucco work performed by Osmi Homes. Smart Home Solutions’ invoice indicates there was “poor installation” of porch precast and that adjustments to the columns and header were required. It further provides statements regarding the stucco installation being “left exposed”. Mr. Kingrani tendered no evidence of his own observations, no photographs, and did not call a representative of Smart Home Solutions to explain the meaning behind “poor installation” and “left exposed”. I am unable to find that there were any deficiencies based on the limited evidence tendered. I find that Mr. Kingrani has not met his evidentiary onus to establish this set-off claim.

ii. Grading, excavation and leveling - $7,627.50 (Scott Schedule Item No. 10)

[237] Mr. Kingrani claims $7,627.50 for grading, levelling and excavation work performed by ISA Co. Trading Inc. (“ISA”). ISA’s invoice is comprised of 6 items, as follows:

(a) Six truck hauling charges for “Extra soil from leveling and grading” on April 22, 2016 at a rate of $300 per haul;

(b) Excavation to “connect city pipe” on April 22, 2016 for a charge of $800;

(c) Leveling and grading the front and back yard on April 23, 2016 for a charge of $2,500, less a credit discount on service of $450;

(d) A bin on April 24, 2016 for a charge of $500;

(e) Levelling work for interlock on April 27, 2016 for a charge of $500;

(f) Truck hauling charges for two loads of soil for interlock on May 3, 2016 for a charge of $300 per load; and

(g) Excavation described as “4 ft excavation Services for stairs wall foundation” on May 4, 2016 for a charge of $500.

[238] Mr. Kingrani’s affidavit evidence on this work was brief, stating only as follows:

Osmi, during excavation piled large amounts of soil and fill in the backyard. He left it there after he stopped work. He also failed to level and grade the land during his construction. That was within his scope of work. The grading, levelling and excavation required to repair was performed by ISA Co. Trading Inc. or about April, 2016.

[239] Consistent with his affidavit, Mr. Kingrani’s testimony was that Osmi Homes left substantial excavation debris in the backyard that needed to be removed. Mr. Jhaveri’s response to ISA’s invoice is located in a document appended to his second affidavit and adopted into his evidence, in which Mr. Jhaveri states that Osmi Homes’ excavators “did not leave a mound of mud on the back of the property and there is no evidence than any such mound of mud was left.” Mr. Jhaveri suggests that excess mud “was caused by grading and leveling for drainage purposes around the exterior of the house which was not part of the contract”, although that statement appears to be nothing more than his unfounded opinion.

[240] Mr. Kingrani’s explanation of ISA’s work does not address all itemized work on the invoice. For example, it is not clear whether the charge for truck hauling removal of “extra soil from leveling and grading” on April 22, 2016 is in respect of extra soil left by Osmi Homes, or if it relates to the excavation, leveling or grading work listed on the invoice as being performed by ISA on April 22 and 23, 2016. Neither Mr. Kingrani’s affidavit evidence nor viva voce testimony support a finding that he was present throughout ISA’s work. No photographs were tendered. No representative from ISA or any other witness was called to explain the work itemized in ISA’s invoice or why it was required. The invoice itself contains no information regarding those matters.

[241] A number of ISA’s charges also appear on their face to be beyond Osmi Homes’ contract scope of work. Excavation “to connect city pipe” appears to be work in respect of bringing city water or drainage connections to the property, which is expressly an owner responsibility under the contract with Osmi Homes. There is nothing in the contract and no evidence supporting a finding that Osmi Homes agreed to complete leveling or grading of the front and back yards or to perform preparation work for installation of interlock. The 4-ft excavation charge might relate to the front porch stair work performed by Smart Home Solutions (which refers to 4-ft footings), but there is no evidence confirming that and, in any event, I have found that Mr. Kingrani has not shown that front porch stair work was required as a result of any incomplete or deficient work performed by Osmi Homes.

[242] On the totality of the evidence, I am not satisfied that Mr. Kingrani has met his evidentiary onus of establishing these alleged deficiencies in Osmi Homes’ work.

iii. Plumbing rough-in and fixtures - $6,799.99 (Scott Schedule Item No. 1)

[243] Mr. Kingrani alleges that certain plumbing rough-in was not completed, and that toilets and shower fixtures were not supplied or installed. Osmi Homes’ position is that all plumbing rough-in was completed and all fixtures were installed, other than installation of the toilets that are the subject matter of the credit memo. An invoice from AAR Plumbing & Heating Supply (“AAR”) for $6,799.99 was tendered as proof of purchase and supply of the outstanding fixtures. An email exchange with James Adams of Build.ca is also tendered to support that shower fixtures were not supplied.

[244] The only bathroom details expressly noted in the contract are the supply and installation of four toilets and three Grohe bathroom shower fixtures. Mr. Kingrani’s evidence is that no toilets were supplied by Osmi Homes and that two of the three Grohe fixtures were also not supplied. Conversely, Mr. Jhaveri’s evidence is that the toilets and fixtures were supplied and that all fixtures were installed. Invoices were tendered supporting Osmi Homes’ purchases of the toilets and three Grohe fixtures with a “thermo rough-in”. Mr. Jhaveri testified that the toilets were delivered to site, but not installed because bathroom tiling work was not complete. His testimony on cross-examination was that he had purchased the toilets six months in advance because he buys them when they are “cheap in the market”.

[245] During cross-examination, Mr. Kingrani expressed his belief that the invoices tendered by Osmi Homes are fake. He supported his view by stating that if the address for the toilet supplier was searched on the internet “you would be shocked”. The allegation that these invoices are fake or forged was never put to Mr. Jhaveri during cross-examination, nor was any evidence regarding the “shocking” information about the address of the toilet supplier. I have accordingly given no weight to Mr. Kingrani’s unfounded opinion.

[246] In my view, neither AAR’s invoice nor the email exchange with Mr. Adams of Build.ca are reliable evidence to corroborate Mr. Kingrani’s otherwise self-serving evidence that the toilets and bathroom fixtures were not supplied by Osmi Homes. I say this for several reasons:

(a) The contract calls for supply and installation of four toilets. Consistent with the permit drawings, Mr. Kingrani acknowledged during cross-examination that there are four bathrooms in the house. However, AAR’s invoice clearly indicates that nine toilets were purchased at a price of $425 each ($25 per toilet higher than the cost indicated on the invoice tendered by Osmi Homes). No explanation was provided for purchasing an additional five toilets.

(b) No specific evidence was given regarding the four faucets listed on AAR’s invoice, what an “A/S Fluent” is and why it was required, or what comprised “plumbing supplies” charged at $147.69 and why they were necessary. Mr. Kingrani’s affidavit evidence states, “The plumbing rough-ins were not completed and the toilets and two of the three shower fixtures were neither supplied or installed at 132 Church.” There is no suggestion that faucets were not supplied and installed, which is consistent with Osmi Homes’ position that they did not form part of its contract scope of work.

(c) The Church Project address is not noted anywhere on the AAR invoice. The listed shipping address is an address in Woodbridge, Ontario. That address was not explained and was not otherwise in evidence. In conjunction with the unexplained toilet and faucet purchases, the shipping address raises questions about whether the items were, in fact, for the Church Project.

(d) When asked in cross-examination to explain why only two Grohe shower fixtures were ordered from AAR, Mr. Kingrani explained it was because AAR helped with the smaller two bathrooms and he had to get the third fixture online because he could not find it. That, according to Mr. Kingrani’s testimony, is why he emailed James Adams of Build.ca. However, that testimony seems inconsistent with Mr. Kingrani’s affidavit, which states two shower fixtures were not supplied and the third was supplied, but was installed deficiently and required jet repair (which is the subject matter of a separate deficiency claim). The need to source and purchase a third fixture was not clarified in the evidence.

(e) Other than Mr. Kingrani’s cross-examination testimony noted above, no specific evidence was given regarding the email exchange with James Adams. In the email to Mr. Adams, Mr. Kingrani includes a copy of an email from Danny Lai from Grohe stating, “It looks like you are missing a lot of parts, and I will suggest to bring all these pictures to one of the Grohe dealers […]”. The referenced pictures were not tendered at trial and nothing in the email indicates the Church Project. Mr. Adams’ response indicates that Mr. Kingrani is to ship certain Grohe parts to Build.ca, but no explanation was provided by Mr. Kingrani regarding what was being discussed, why parts were to be shipped, if they were shipped, and what came of it.

[247] I have generally preferred the evidence of Mr. Kingrani where it conflicts with the evidence of Mr. Jhaveri. However, in this instance, the evidence tendered to corroborate Mr. Kingrani’s position that the toilets and fixtures were not supplied has questionable reliability, and no other corroboration has been tendered. In this instance, I find Mr. Jhaveri’s evidence to be more credible, particularly since Osmi Homes’ purchase of the toilets and Grohe shower fixtures is corroborated by purchase invoices and Mr. Jhaveri was never cross-examined on Mr. Kingrani’s serious allegation that they are “fake” invoices. I accordingly find that the toilets were supplied and the shower fixtures were supplied and installed by Osmi Homes. There is accordingly no basis for a set-off claim for the purchase of new toilets or shower fixtures.

[248] Toilets were admittedly not installed by Osmi Homes. While Mr. Jhaveri’s evidence-in-chief did not distinguish what portion of the $3,000 credit memo related to the air conditioning unit and what portion related to toilet installation, he testified during cross-examination that he credited an aggregate of $200 for the uninstalled toilets ($50 per toilet). No evidence substantiating that estimate was provided by Mr. Jhaveri. I do not accept that Osmi Homes’ credit of $50 per toilet is reasonable. It is, in my view, an unrealistically low estimate for the cost of toilet installation, particularly in Toronto. However, Mr. Kingrani has tendered no evidence supporting his actual installation costs. From the limited evidence, AAR appears to be only a supplier, but in any event AAR’s invoice makes no reference to installation. In the absence of evidence from either party supporting the actual or a reasonable estimated cost of toilet installation, I am left with fixing an amount that is fair, reasonable and equitable considering that toilet installation is an acknowledged incomplete part of Osmi Homes’ contract scope of work. I accordingly fix the fair and reasonable cost of installing the toilets at $150 per toilet, for an aggregate of $600, plus HST, which I allow as a set-off.

iv. Air conditioning unit - $2,712.00 (Scott Schedule Item No. 4)

[249] Mr. Kingrani claims $2,712.00 for supply and installation of the air conditioning unit, as invoiced by AD Appliance Service. Osmi Homes does not dispute that the air conditioning unit was not supplied, but argues that a credit has already been given. I accept Mr. Kingrani’s evidence and find that the air conditioning unit was supplied and installed by AD Appliance Service at the price charged in the invoice, namely $2,400 plus HST.

[250] As noted, the parties agree that Mr. Kingrani is not entitled to both Osmi Homes’ credit and the set-off for incomplete work. I have already found that the reasonable cost of toilet installation is $150 per toilet, for a total of $600 plus HST. Unintentionally, the result of my findings is entitlement to an aggregate set-off of $3,000 plus HST for the supply and installation of the air conditioning unit and installation of toilets, which is the same credit given by Osmi Homes, although calculated differently.

v. HRV unit - $5,650.00 (Scott Schedule Item No. 8)

[251] Although listed in the Scott Schedule as incomplete work, Mr. Kingrani provided no direct affidavit evidence regarding the required HRV unit. Its supply and installation (or lack thereof) was also not addressed in viva voce testimony at trial. The only evidence supporting that the HRV unit was not supplied and installed is found in a list of Mr. Kingrani’s commentary on allegedly deficient and incomplete work at Exhibit M to his affidavit, which Mr. Kingrani states in his affidavit is an accurate summary of the work he completed. That list includes the statement, “H.R.V. unit is not installed according to contract he has to supply but he did not, till today's date there is no HRV unit installed”. Mr. Jhaveri responded to the allegation in Exhibit BB of his second affidavit, which states, “In response to Anil Kumar's statement that there was no H.R.V., I have obtained an affidavit in response to this statement and the documents filed in exhibit N to [Mr. Kingrani’s affidavit], that contradicts Anil Kumar's allegations.” This refers to the affidavit of Clement Morgan, which was withdrawn when Mr. Morgan did not attend for his cross-examination.

[252] There is no evidence that an HRV unit was supplied and installed after Osmi Homes left the Church Project, so there is no evidence supporting any quantifiable loss for this item. As noted earlier in these reasons, Mr. Kingrani’s counsel confirmed during his client’s cross-examination that no claim was being pursued for incomplete or deficient work for which no invoice was tendered in Exhibit N to Mr. Kingrani’s affidavit. None of the invoices address the supply and installation of an HRV unit.

[253] While Osmi Homes generally bears the evidentiary onus of proving its supply of services and materials, it is Mr. Kingrani’s evidentiary onus to prove his set-off claim and counterclaim. His unsubstantiated allegation that the HRV unit was not installed is made in a document containing a series of unsubstantiated allegations regarding Osmi Homes’ work that is appended to Mr. Kingrani’s affidavit and casually adopted into his evidence. No corroborating documentation was tendered or witnesses called. This is another instance in which I find Mr. Kingrani’s evidence lacks credibility. I accordingly find that the HRV unit was supplied and installed, and that Mr. Kingrani has failed to prove any compensable loss arising from that work.

vi. Garage door installation - $2,870.20 (Scott Schedule Item No. 5)

[254] Mr. Kingrani claims for the cost of supplying and installing garage doors, regarding which he has tendered an invoice from Maple Overhead Garage Doors in the amount of $2,870.20. Garage doors are not mentioned anywhere in the contract. Mr. Kingrani argues that the garages required garage doors, so the supply and installation of garage doors was included in the contract. Conversely, Osmi Homes argues that garage doors were not included in the base contract scope of work, which provides the following regarding doors:

DOORS Details:

Door from garage to the house installed

Door from walk out basement installed

Door in family Room out to Deck installed

External Main door material and labor not included

The bedrooms and other interior doors are not included

[255] As put to Mr. Kingrani on cross-examination, there is a door depicted in the permit drawings at the rear of the garage that leads into the house. The permit drawings also depict a door to the walk-out on the lower level and a door from the family room to the deck. Those three doors appear to match the above descriptions of the doors included in the contract.

[256] Mr. Kingrani testified during cross-examination that the he understood supply and installation of the garage doors to be included in the “Scope of Work” schedule item “Door from garage to the house installed”. He disagreed that it refers to the entry door from the garage to the house. During re-examination, Mr. Kingrani testified that he had discussed the garage doors with Mr. Jhaveri after signing the contract, and Mr. Jhaveri had specifically agreed he would supply and install the garage doors. Mr. Kingrani also pointed out that there is a second door in the garage leading outside, which was supplied by Osmi Homes, even though the “DOOR Details” section refers only to a singular door. He testified that he understood the contract would include all doors for the garage, including the two supplied by Osmi Homes and the two garage doors.

[257] Garage doors are not expressly referenced in the contract or expressly excluded the in “DOOR Details” section. They are not the same type of door that is the subject matter of that section. Each of the referenced doors appear to be hinged doors, as is the additional door from the garage to which Mr. Kingrani referred in his cross-examination. The permit drawings depict a double garage with two garage door openings. However, no evidence supports any agreement or reasonable understanding that garage doors were to be supplied and installed, or what make, model or price point was expected. Moreover, Mr. Kingrani has only tendered evidence that he purchased the garage door components, but there is no evidence that those components are an appropriate equivalent to what ought to have been installed.

[258] Having reviewed the language of the contract and weighed the evidence of the parties, I find that supply and installation of garage doors was not part of Osmi Homes’ contract scope of work. It is thereby not incomplete work for which Mr. Kingrani is entitled to claim any set-off.

vii. Electrical inspection, pot lights and light fixtures - $2,373.00 (Scott Schedule Item No. 2)

[259] Both the Scott Schedule and Mr. Kingrani’s affidavit indicate that CC Commercial Inc. was paid $2,373 to complete light fixture installation that was the responsibility of Osmi Homes. Nevertheless, in his brief supplementary examination-in-chief, Mr. Kingrani confirmed that the invoice had nothing to do with Osmi Homes, and does not relate to Mr. Kingrani’s set-off and counterclaim. Although Mr. Kingrani alleges that an electrical inspection was not done and that there were other electrical deficiencies, such as missing electrical connections and switches, no other evidence was tendered supporting those deficiencies or any quantifiable loss incurred by Mr. Kingrani. I accordingly find that Mr. Kingrani has not made out this set-off claim.

viii. Security system installation - $1,395.00 (Scott Schedule Item No. 3)

[260] Mr. Kingrani alleges that a security system, intercom system and stereo speakers were not installed as required by the contract. Mr. Kingrani claims for amounts paid to Confident Security Systems Ltd. (“Confident”) in the amount of $1,395, including HST. During cross-examination, Bo Liu testified that Shelltech’s scope of work included what was invoiced by Confident, except for supply and installation of an LG 22-inch monitor and power stereo amplifier. Mr. Liu confirmed that the monitor would be used with the security cameras, but is not something he supplies to his customers. He also confirmed that the amplifier would be for speakers, but did not provide it.

[261] Phase 6 of the “Scope of Work” schedule includes the supply and installation of smart wiring, telephone wiring, intercom with colour monitor, security cameras with HDCVI DVR 1TB surveillance hard disk, and music speakers for channel music. Under a subsequent heading of “SMART WIRING Details” the following work is identified:

SMART WIRING Details:

Networking Wiring: Cat SE network wiring with bracket and plate to the basement Master room, Bedroom X3, Living, Family, study, Dinning [sic]

Intercom Details: 7" TFT, 4 wire col or monitor with 4 wire waterproof Video camera Running pipe from Top floor X2, Main floor X2, Basement X2 to Garage

Central Vacuum: Running pipe from Top floor X2, Main floor X2, Basement X2 to Garage

Speakers: Channel Music system 6.5 85W POLY CEILN SPKR PR with clear sound quality with no noise Master Bedroom, living room, Dinning [sic].

Security Cameras: 4 Security Cameras installed with kit HDCVI 720P high quality waterproof Dome camera *4 with HDCVI DVR 1TB surveillance hard disk.

Telephone Wiring: Telephone wiring with bracket and plate to the basement Master, Kitchen, Study.

TV cable Wiring: TV Cable wiring with bracket and plate to the basement Master room, Bedroom X3, living, Family, Study, and Dinning [sic]

[262] The above contract scope of work is the same scope of work reflected in Shelltech’s invoice, which is the same work that Mr. Liu states in his affidavit was completed, invoiced and paid in full. Mr. Liu testified confidently that all work was performed, and he specifically recalled installing 4 cameras at the at front, back and both sides of the house. In re-examination, Mr. Liu confirmed that he had supplied and installed a recorder with hard disk and video doorbell intercom, all of which are items included in the Confident invoice. There is nothing in the evidence supporting that supply and installation of a monitor and amplifier was part of Osmi Homes’ contract scope of work.

[263] Mr. Kingrani testified that Mr. Liu was lying to the court, otherwise he would not have had to engage Confident. To the contrary, I found Mr. Liu to be a credible witness who was honest and forthright in his answers. Mr. Kingrani could have, but did not, call a corroborating witness from Confident or could have tendered evidence other than a single invoice for work purportedly performed. I accept Mr. Liu’s evidence on the work performed by Shelltech. There is no evidence supporting a finding that either the installation work or equipment was deficient. To the extent that Mr. Kingrani engaged Confident to perform the work outlined in the invoice, I find that it was either work beyond the scope of Osmi Homes’ contract or work untaken for reasons other than correcting deficiencies or completing unfinished work.

ix. Furnace installation - $1,279.10 (Scott Schedule Item No. 6)

[264] Deficiencies are alleged with the furnace installation, in respect of which the sum of $1,279.10 is claimed, comprised of $79.10 for the cost of an Enbridge inspection on January 25, 2017 and $1,200 for the subsequent cost of OM Heating & Air Conditioning (“OM Heating”) remedying the allegedly deficient furnace installation. Neither Enbridge’s inspector nor the contractor from OM Heating were called as witnesses. Mr. Kingrani’s evidence is that Enbridge’s inspector confirmed that the furnace installation work was done improperly, and that OM Heating was engaged to correct the deficiencies.

[265] Mr. Kingrani relies on the Enbridge inspector’s inspection notice dated January 25, 2017 as proof of the furnace installation deficiencies. During Mr. Kingrani’s brief viva voce examination-in-chief, he testified that the inspector found many “discrepancies”. However, the only evidence of those discrepancies are statements made by Mr. Kingrani in his commentary on deficient and incomplete work at Exhibit M to his affidavit, and handwritten notes in the inspection notice. In my view, neither are sufficient to demonstrate deficiencies in Osmi Homes’ work on a balance of probabilities. I note the following:

(a) In the Exhibit M document, Mr. Kingrani comments that the furnace work was done unprofessionally. It is an expert opinion that Mr. Kingrani is not qualified to give. The document further states that Enbridge’s inspector gave Mr. Kingrani “a hard time” to fix issues such as there being no pressure tags on pipes and a valve not being installed. These are uncorroborated hearsay statements.

(b) The inspection notice lists a number of items under the heading “Infractions”, including the notes, “furnace union needed”, “proper itemized pressure test tag”, “perm id tag at manifold” and “pressure test tags fireplaces”, among others. In my view, these notes are not self-explanatory and required evidence to explain how the items represent deficiencies in Osmi Homes’ work.

[266] OM Heating’s invoice notes installation and pressure testing of ¾” gas tight pipe, installation of union and ½” shutoff to furnace and pressure test, and pressure testing of a further four gas lines. It is unclear from the invoice if the ¾” gas tight pipe and pressure testing of that and four other gas lines relate to the furnace. In explanation, Mr. Kingrani testified that Enbridge’s inspector told him the gas pipes to the fireplaces were not large enough and had to be changed. However, Mr. Kingrani’s testimony also confirmed that he was installing new appliances in January 2017. No evidence on the differences, if any, between existing appliances and the new appliances was tendered that would allow the court to confirm that the change in gas pipe sizes was not because of a change in the appliances.

[267] There is also no evidence on why OM Heating’s work was required. While the contract does provide that Osmi Homes is to supply gas lines to two fireplaces, the deck and a cooktop, Mr. Kingrani agreed during cross-examination that he was responsible for supplying the fireplaces and stove. Mr. Kingrani was challenged on how Osmi Homes could reasonably complete pressure testing prior to installation of all gas appliances. Mr. Kingrani was unable to explain the purpose of the pressure tests and tendered no evidence on when the gas appliances were installed or why any pressure testing would be required prior to installation of all gas appliances.

[268] There is some evidence from Mr. Kingrani that Osmi Homes failed to complete grounding of the furnace, which is work purportedly completed by Elkonor Inc. However, while there is a letter from “Bogdan” of Elkonor Inc. purporting to certify that gas pipe grounding at the Church Project was completed, Mr. Kingrani tenders that letter for the truth of its contents without any corroborating evidence that Osmi Homes was required to do the grounding, on what basis it was required work, and that Osmi Homes failed to do it. Also, no invoice was tendered for Elkonor Inc.’s work and no damages are claimed.

[269] Mr. Kingrani has failed to meet his evidentiary onus of establishing, on a balance of probabilities, that Enbridge’s inspection and OM Heating’s work, which did not occur until over nine months after Osmi Homes left the Church Project, relates to Osmi Homes’ contract scope of work and were necessary as a result of defects in that work.

x. Gas line connections and defects - $1,200.00 (Scott Schedule Item No. 7)

[270] Mr. Kingrani’s affidavit does not address gas line connection issues or defects. During Mr. Kingrani’s brief supplementary viva voce examination-in-chief, he testified that Elkonor Inc. performed work to ground gas pipes that Enbridge’s inspector identified as requiring grounding. The Enbridge inspection notice does include a parenthetical note reading, “electric bonding (ground gas line)”. As noted above, a letter from “Bogdan” of Elkonor Inc. was tendered, but he was not called as a witness. No evidence was tendered supporting any quantifiable loss on account of gas line connection work. The deficiency claim in respect of gas lines and connections has not been made out.

xi. Other alleged deficiencies and incomplete work (Not included in Scott Schedule)

[271] There are a number of additional deficiencies and incomplete work alleged by Mr. Kingrani on which some evidence was tendered, but which are not reflected in the Scott schedule, namely that Osmi Homes:

(a) failed to complete drywall in the kitchen next to the window;

(b) failed to put a water connection for the garden in the backyard;

(c) failed to install water and sewage lines to the house;

(d) failed to properly frame the basement, resulting in “a lot of time and money to get it fixed”;

(e) installed only one of two skylights required by the contract;

(f) failed to install insulation in the roof side;

(g) failed to demolish and remove the existing driveway; and

(h) deficiently installed body jets in a bathroom, requiring repair work by a third party.

[272] The driveway and body jets were the subject matter of viva voce testimony or specific affidavit evidence at trial. Evidence of the other six items is only found in Mr. Kingrani’s commentary on deficient and incomplete work at Exhibit M to his affidavit. No direct or corroborating evidence was tendered to substantiate them or support any quantification of loss associated with them. No submissions were made regarding what treatment should be given to them. During Mr. Kingrani’s cross-examination, his counsel confirmed that these items are alleged as deficiencies, but do not form part of Mr. Kingrani’s claim. In my view, there is insufficient evidence to find that these items were, in fact, deficient or incomplete work.

[273] Mr. Kingrani testified that Osmi Homes failed to demolish and remove the existing driveway, which he viewed as being included in the demolition phase of the contract work. Osmi Homes disputes that demolishing the existing driveway was part of its work. Mr. Kingrani testified that the driveway demolition was completed by ISA, although acknowledged the work was not part of ISA’s invoice in evidence. Mr. Kingrani testified that he paid for the demolition work, but no evidence was tendered regarding any payment or quantifiable loss being incurred. I need not determine whether it was part of Osmi Homes’ contract scope of work. If it was part of Osmi Homes’ work, then failing to complete it is not a sufficiently material breach of contract to deny Osmi Homes’ claim and, in any event, there is no loss claimed in respect of the demolition work.

[274] Mr. Kingrani also alleges deficient installation of shower fixture jets in the master en suite bathroom. Mr. Kingrani claims $1,285 was spent to have “John” from Plumbing & Drain Solutions Inc. reinstall Grohe body jets. The relevant invoice describes the scope of work performed as “Reinstall body jets due to improper installation.” The date of the invoice is July 5, 2016. Mr. Kingrani confirmed in cross-examination that no notice of the alleged deficiency was given to Osmi Homes and Mr. Jhaveri was never given an opportunity to return to rectify the deficiency. “John” was not called as a witness to explain what he meant by “improper installation”. Other than the invoice and Mr. Kingrani’s unparticularized cross-examination testimony that there was a “big problem” with the body jets, no evidence regarding the nature and extent of the alleged deficiency was tendered. In my view, Mr. Kingrani has not met his evidentiary onus of demonstrating that the body jets were installed deficiently on the limited evidence tendered, and thereby has not established entitlement to the claimed set-off.

xii. Failure to provide Tarion insurance (Not included in Scott Schedule)

[275] Exhibit M to Mr. Kingrani’s affidavit also alleges that Mr. Jhaveri “promised” to provide Tarion insurance, which was a reason for Mr. Kingrani engaging Osmi Homes instead of another contractor. This alleged representation was not the subject matter of any viva voce examination. Mr. Jhaveri’s affidavit evidence denies that Osmi Homes was ever going to provide Tarion warranty coverage. The contract language is consistent with Mr. Jhaveri’s evidence, providing expressly that Osmi Homes would “provide the TARION only if the builder is allowed to complete the entire project till occupation permit”. Mr. Kingrani tendered no evidence supporting that the extent of work performed by Osmi Homes triggered any requirement for Tarion registration by Osmi Homes. No evidence was tendered supporting any quantification of loss associated with lack of Tarion insurance. I accordingly find that Osmi Homes was not required to provide Tarion insurance and that, in any event, Mr. Kingrani has suffered no loss on account of Osmi Homes not registering the house with Tarion.

xiii. Calculation of set-off

[276] For the foregoing reasons, I find that Mr. Kingrani has proven and is entitled to a net set-off in the amount of $874.62, calculated as follows:

Front porch ceiling soffits and trim $ 774.00 Toilet installation 600.00 Supply and installation of air conditioner 2400.00 Less: Credit already accounted for a/c and toilet installation - 3,000.00 Subtotal $ 774.00 HST 100.62 Total allowed set-offs $ 874.62

g. Timeliness of the lien

[277] Osmi Homes has the evidentiary onus of proving timeliness of its lien. Subsection 31(2) of the now-former Construction Lien Act, RSO 1990, c. C.30 (the “CLA”) (the provisions of which remain applicable to this proceeding by operation of section 87.3 of the current Construction Act, RSO 1990 c. c.30) provides that a contractor’s lien expires at the conclusion of the 45-day period following the date the contract is completed or abandoned. Last supply is not relevant to the lien rights of a prime contractor. Osmi Homes’ lien was registered on April 14, 2016. Accordingly, if the contract was completed or abandoned prior to February 29, 2016, then Osmi Homes’ lien rights would already have expired at the time the lien was registered.

[278] Given the contract price, subsection 2(3) of the CLA deems that the contract is completed when the price of completion or correction of a known defect is $1,000.00 or less. It is undisputed that Osmi Homes did not supply and install the air conditioning unit, nor did it install the toilets, both of which were within Osmi Homes’ contract scope of work. The actual cost of supplying and installing the air conditioning unit was $2,400 plus HST, and I have allowed $600 plus HST as the cost of toilet installation. Osmi Homes’ credit memo for these items was issued on April 12, 2016. There is no evidence of any agreement to remove the items from the contract scope of work prior to that date. The cost to complete the contract was thereby higher than $1,000 as of April 12, 2016.

[279] Mr. Kingrani pleads that Osmi Homes abandoned the contract. No case law was submitted on the legal requirements for abandonment. No argument was made regarding either a specific date on which Osmi Homes formed an intention to abandon prior to April 12, 2016 or a date of actual abandonment. In early April 2016, emails were still being exchanged regarding the work. There is no evidence supporting any subjective or objective intention of Osmi Homes to abandon the contract. In my view, it would be a commercially unreasonable result to hold that issuing a credit for relatively minor work that a contractor no longer intends to complete amounts to abandonment of the contract, particularly at a point where the contract work was otherwise completed, subject to minor deficiencies.

[280] I accordingly find that the contract was not abandoned by Osmi Homes at all, and was not completed more than 45-days prior to registration of Osmi Homes’ claim for lien. The lien is thereby timely.

h. Breach of contract

[281] Given my findings above, after deducting the allowed payments and allowed set-offs, Osmi Homes is owed the sum of $86,244.38 on account of its services and materials. I have found that Osmi Homes did not abandon the contract. Mr. Kingrani’s basis for non-payment was that Osmi Homes had been overpaid for the work performed and that there were also deficiencies and incomplete work. I accept there was no agreement that Osmi Homes would not supply and install the air conditioning unit, would not supply and install front porch soffits and trim, or would not install toilets. Osmi Homes’ failure to complete that work did constitute a breach of the contract. However, in my view, these were minor breaches that would not amount to grounds for termination and, in any event, did not warrant any withholding greater than the estimated value of these items less the credit given by Osmi Homes.

[282] Since Mr. Kingrani’s basis for withholding payment is not supported by the findings made on the evidence, it follows that Mr. Kingrani materially breached the contract by failing to make payment of the amounts found owing to Osmi Homes.

i. Pre-judgment interest

[283] In its statement of claim, Osmi Homes claims pre-judgment interest in accordance with the Courts of Justice Act, RSO 1990, c. c.43. The contract does not include any agreement regarding interest on overdue amounts. Although Osmi Homes’ invoices indicate a 24% interest charge on unpaid amounts, Mr. Kingrani confirmed he was objecting to that interest rate in his email of October 6, 2015, and there is no evidence supporting an agreement on an interest rate or from when interest would accrue.

[284] Given the evidence, I find that the parties had no agreement that interest would be payable on unpaid amounts during the course of the contract. Pursuant to subsection 128(1) of the Courts of Justice Act, Osmi Homes is entitled to pre-judgment interest from the date its cause of action arose. No evidence was tendered on the specific date on which the relationship between the parties broke down, leading to registration of the claim for lien. I accordingly find that Osmi Homes’ cause of action arose on the same date as the registration.

VII. Conclusion

[285] For the foregoing reasons, I find that Osmi Homes is entitled to a lien in the amount of $86,244.38 and judgment against Mr. Kingrani in the amount of $86,244.38, plus pre-judgment interest from April 14, 2016 to the date of this judgment at the rate of 0.8% per annum pursuant to the Courts of Justice Act in the amount of $2,795.74, for a total of $89,040.12.

VIII. Costs

[286] As set out in the Notice to the Profession released by the Chief Justice of the Superior Court of Justice dated March 15, 2020, regular operations of the Superior Court of Justice have been suspended to protect the health and safety of all court users and to help contain the spread of the 2019 novel coronavirus (COVID-19). Currently, only urgent and consent civil applications and motions are being heard by the court in accordance with the Notices to the Profession released by the Chief Justice dated March 15 and April 2, 2020 and the Notice to Profession – Toronto released by the Regional Senior Judge dated April 2, 2020, as revised April 22, 2020.

[287] The parties are encouraged to settle costs. If agreement cannot be reached, then written costs submissions shall be submitted. Osmi Homes shall deliver written costs submissions by May 21, 2020. Mr. Kingrani shall thereafter deliver his responding costs submissions by June 4, 2020. Osmi Homes shall thereafter be entitled to deliver reply cost submissions by June 11, 2020. Costs submissions shall not exceed five pages, excluding any offers to settle or case law, with any reply cost submissions not to exceed two pages. Both parties previously filed bills of costs, but those bills of costs are not currently available to me as a result of current remote operations. Accordingly, copies of the previously delivered bills of costs shall also be re-submitted with the parties’ costs submissions.

[288] Since I am unaware of the current circumstances of the parties or their counsel, if the above timetable cannot be met by one or both of the parties as a result of the ongoing pandemic, then the parties must confer on how they propose to proceed with cost submissions and may write to me jointly via my Assistant Trial Coordinator. If agreement cannot be reached, the parties shall prepare a joint letter briefly setting out their respective positions on the timing of cost submissions. Counsel and parties are reminded and encouraged to consider the call for cooperation in the Notice to the Profession released by the Chief Justice, which states, “During this temporary suspension of regular operations, the Court calls upon the cooperation of counsel and parties to engage in every effort to resolve matters.”

[289] Service of all costs submissions by email is hereby authorized. All costs submissions shall be submitted by email directly to me or my Assistant Trial Coordinator with a scanned copy of proof of service. Hard copies shall not be required since the parties should not be attending the courthouse at this time. Original proof of service need only be filed if the court so directs. In the absence of receiving written submissions as directed above, the parties shall be deemed to have agreed on costs.

IX. Report

[290] The parties shall prepare and file a draft report in the form prescribed by the CLA, with any necessary modifications. The draft report shall be submitted by email directly to me or my Assistant Trial Coordinator in Word-compatible electronic format by no later than the deadline for reply costs submissions. If the parties are unable to agree on the form of my final report, a hearing may be required to settle the report, but that hearing cannot be arranged until non-urgent opposed hearings are being scheduled.

MASTER TODD ROBINSON

Released: May 1, 2020

COURT FILE NO.: CV-16-553425

DATE: 2020 05 01

ONTARIO

SUPERIOR COURT OF JUSTICE

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

B E T W E E N:

OSMI HOMES INC.

Plaintiff

• and -

ANIL KUMAR a.k.a. ANIL KUMAR KINGRANI

Defendant

REASONS FOR JUDGMENT

Master Todd Robinson

Released: May 1, 2020