COURT FILE NO.: CV-19-616601

DATE: August 28, 2020

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: The Reno Pros Inc. v. Blueprint Properties Inc.;

BEFORE: MASTER C. WIEBE

COUNSEL: F. Scott Turton for Blueprint Properties Inc.; Julian Binavince for The Reno Pros Inc.;

HEARING: August 27, 2020.

COSTS DECISION

[1] The defendant, Blueprint Properties Inc. (“Blueprint”), brings this motion on notice for an order under Construction Act, R.S.O. 1990, c. C.30 (“CA”) section 45 declaring the lien described in the claim of lien registered by the plaintiff, The Reno Pros Inc. (“Reno”), on the title to the subject lands, expired on account of a failure to preserve the lien in time. At the first trial management conference in this reference on July 3, 2020, I set a schedule for this motion. After the delivery of the motion record, on July 23, 2020 Reno conceded to Blueprint that the Reno lien had indeed expired as alleged. Therefore, the only issue argued today was the Blueprint claim for costs.

[2] Blueprint claims two awards of costs. First, it claims $5,120.20 in substantial indemnity costs for the March 7, 2019 motion Blueprint brought before me without notice for an order vacating the Reno claim for lien with posted cash security. Second, it claims $6,203.70 in partial indemnity costs for the motion heard by me by Zoom videoconference on August 27, 2020 for an order declaring the lien expired.

Vacating motion costs

[3] The proper preservation of the Reno lien turned on the issue of whether the new provisions of the CA applied. Reno was a subcontractor to Blueprint. Reno’s claim for lien stated that its last date of supply was December 21, 2018. It registered its claim for lien on February 15, 2019, namely 56 days later. Under the new provisions of the CA this was timely preservation; under the old provisions it was not.

[4] The project in issue was the refurbishment of a building by an insurer following a fire. Blueprint was the general contractor. Blueprint filed an affidavit sworn by Winston Ang, principal of Blueprint, which clearly showed that the insurer sought a quote from Blueprint and entered into a verbal contract with Blueprint in June, 2018, namely before July 1, 2018. There are emails substantiating these facts. Therefore, the application of the old provisions seems clear.

[5] I initially expressed a concern as to whether Blueprint should get any costs for the vacating motion. There was no evidence that Blueprint had approached Reno with the evidence in its motion record before bringing its vacating motion. I thought that, had that been done, Reno would probably have consented to having its claim for lien vacated without security thereby avoiding the vacating motion and indeed the within motion. There is an obligation under the CA on parties to take the least costly course of action, and I thought this would have been the least costly course of action.

[6] Counsel helpfully reminded me that the definitions of “contract” and “procurement” in the transition rules in CA section 87.3 (1)(a) and (b) were unclear in early 2019. Both CA section 87.3(2), which clarified the reference to “contract” in section 87.03(1)(a), namely that it did not pertain to subcontracts, and CA section 1(4), which defined the reference to the commencement of the “procurement process” in section 87.03(1)(b), were both brought into effect in July, 2019. Mr. Binavince, therefore, conceded that his client would probably not have consented to a vacating motion without security in March, 2019 as I surmised it would have. He conceded as a result that Blueprint is entitled to some costs thrown away as the vacating motion was unavoidable.

[7] Therefore, the real issue is the proper costs award to be given. Mr. Binavince argued that there was no basis for a substantial indemnity award, as he said Reno acted reasonably given the uncertainty in the statute at that time. Mr. Turton argued that there should be a substantial indemnity award, as there was no explanation from Reno as to why it did not register its claim for lien within the old 45 day lien period, which expired on February 4, 2019. He argued that Reno acted recklessly and brought on this issue by waiting past this 45 day period to register its claim for lien. While there is always merit in acting cautiously, I am not prepared to punish Reno with a substantial indemnity award of costs given the uncertainty in the statute at that time. Nevertheless, I will consider Reno’s conduct in failing to avoid this issue in my final award of costs.

[8] As to quantum, Mr. Turton advised that a partial indemnity costs amount would be in the vicinity of $3,500, which is about 60% of actual cost. Mr. Binavince argued that a vacating motion generally should be straight-forward and should not garner an award of costs of more than $1,500. He argued that having someone of Mr. Turton’s vintage and expense do most of the work on this motion was unreasonable and not what Reno reasonably would expect to pay. He in fact argued that the work on this motion merited an award of no more than $750. I think there is some merit to Mr. Binavince’s submission as the claimed costs do seem excessive. The vacating motion in issue was not a complicated one. I will take that point into consideration.

[9] Considering all of these factors, I have decided to award Blueprint $2,000 in partial indemnity costs for the vacating motion of March 7, 2019.

Costs of motion to declare lien expired

[10] Concerning the costs of the within motion, Mr. Binavince submitted that the claim of $6,203.70 was excessive. He argued that the 3.7 hours shown in the Blueprint bill of costs for legal research by Mr. Turton was too much, as the issues concerning the lien by this time were clear. He argued that the 6.6 hours shown for Mr. Turton’s work in preparing the motion was excessive as the critical evidence was not complicated, namely only a few emails. Mr. Turton responded that the complication on this motion was whether Blueprint was a “contractor” or “subcontractor,” as Blueprint was approached and dealt only with the owner’s insurer. Also, the contract was an oral contract. This all required evidence and legal research. I think the positions of both parties have merit. While the work and evidence concerning the contract and the agency issues were indeed necessary, those issues were not complicated and did not warrant the amount claimed. I will take this point into consideration in the award.

[11] Mr. Binavince argued that the partial indemnity rate shown for Mr. Turton was too high and should be $225/hour for a partial indemnity award. I do not accept that argument, as the claimed $300/hour is about 66% of Mr. Turton’s actual rate.

[12] There is another issue with the Blueprint bill of costs. It shows that Mr. Turton spent 3.4 hours in preparing the factum on August 17 and 18, 2020. It was undisputed that Mr. Binavince on behalf of Reno conceded the merits of the motion as early as July 23, 2020. As a result, I do not understand why the factum was prepared. All that remained to be determined was costs. I do not accept that the cost of preparing the factum was reasonable.

[13] Considering these factors, I have decided to award Blueprint $3,500 in partial indemnity costs for this motion.

Conclusion

[14] In conclusion, I award Blueprint $2,000 in partial indemnity costs for the March 7, 2019 vacating motion, and $3,500 in partial indemnity costs for this motion. This must be paid in thirty (30) days from today. The remainder of the motion went unopposed and is granted. Mr. Turton provided me with a draft form of order, which I have revised and signed. It is enclosed with this decision.

DATE: August 28, 2020

MASTER C. WIEBE