Court File and Parties
COURT FILE NO.: 18-75629-A1 DATE: 20210219 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: SIEMENS CANADA LIMITED, Plaintiffs AND GRC ARCHITECTS INC. and MIRITON LTD, Defendants AND PCL CONSTRUCTORS CANADA INC., COVERTITE EASTERN LTD. and CLEB CONSULTANT INC., Third Parties
BEFORE: The Honourable Justice C.T. Hackland
COUNSEL: Nadia J. Authier, for the Third Party, Covertite Eastern LTD (Moving Party) John A. Little, for the Defendant, GRC Architects Inc. Iain Peck, for the Third Party, PCL Constructors Canada Inc.
HEARD: January 5, 2021
Endorsement (Summary Judgment Motion)
Background
[1] The moving party Covertite Eastern Ltd. (“Covertite”) is the defendant in a Third-Party Claim advanced by the defendant GRC Architects Inc. (“GRC”). Covertite seeks an order for summary judgement pursuant to Rule 20 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, dismissing the Third Party Claim.
[2] This action arises out of persistent water infiltration problems which occurred in the roofing structure of a building at Algonquin College in Ottawa. The construction of the building was undertaken by Siemens Canada Ltd., the plaintiff in the main action. The construction included the installation of five air handling units (AHUs) on the roof of one of the buildings. Subsequent to the instillation of the AHUs, Covertite was retained by the construction manager on the project, PCL Constructors Canada Inc., (PCL), to install the roofing seal and flashing on the building.
[3] During the course of the project water infiltration problems emanating from the roof were identified and several reviews and investigations were undertaken to determine the possible causes including the design and installation of the AHUs and/or the manner of sealing the roof membrane around the AHUs and related issues. Several consultants prepared reports discussing both the ongoing problems and the proposed remediation. These investigations took place during and after completion of the project because the water infiltration problems persisted. There was considerable controversy as to whether there were deficiencies in the roof design concerning the sealing of the roof membrane around the AHUs or whether there were workmanship problems with the roof membrane installation, which installation was the responsibility of Covertite. These will be important factual issues to be determined when the main action is tried.
[4] Covertite contends that the leakage problems were ultimately determined to be design related, pertaining to the AHUs and leakage emanating through the walls of these units. This is why, Covertite suggests, that the plaintiff in the main action (Siemens) is pursuing only the two defendants GRC and Miriton Ltd., who supplied the design. Covertite argues that its mandate was the instillation of the roof membrane and flashing and it had no design responsibility. As noted, both GRC and Miriton, the defendants in the main action, have commenced Third Party proceedings against Covertite. Covertite argues that if the plaintiff succeeds at trial in proving design defects against either or both of the two defendants, there would be no basis to seek contribution and indemnity against Covertite who had no responsibility for the design. Covertite adds that in any event there were no problems with its workmanship in installing the roof membrane and flashing.
[5] In response, GRC submits that it is claiming indemnity against Covertite under the Negligence Act on the basis that Covertite is or may be fully or partially responsible for the damages as claimed by the plaintiff. GRC points out that there is evidence in the record from GRC and from roofing experts who have consulted on the project indicating negligence or poor workmanship on the part of Covertite. GRC has pled in its statement of defence in the main action that the work performed by PCL and its subcontractor, Covertite, was not carried out properly thereby causing damage to the plaintiff. Miraton has filed a similar defence making allegations of improper workmanship. It can therefore be seen that a major issue in the trial of the main action and any cross-claims, will be the cause of the damages and, in particular, whether such damages arose from design deficiencies or construction / workmanship deficiencies, or a combination of the two.
[6] GRC refers to a number of expert’s reports or studies undertaken with respect to the ongoing water infiltration problems, eg. the CLEB report of October 5, 2015, the Daly Building Consulting report dated May 10, 2016 and a further CLEB report dated February 24, 2017, all of which identified deficiencies in the construction work carried out by Covertite. These allegations of workmanship deficiencies are supported by GRC’s affiant, Mr. Livingston.
[7] As to the progress of proceedings, the parties advise that examinations for discovery are now complete in the main action and in the subject GRC Third-Party action against Covertite, PCL and CLEB Inc., although Covertite has not yet answered its undertakings. In the other Third Party action brought by Miriton Ltd. in which Covertite and PCL are also defendants, discoveries have not yet taken place. Covertite is not currently seeking summary judgement dismissing Miriton’s Third Party Claim against it.
[8] GRC raises the concern, in my opinion with some merit, that the overlapping issues of whether design and or faulty construction caused or contributed to the damages claimed by the plaintiff will necessarily have to be determined in the main action and in the Miriton Third-Party action. The determination of these issues on this motion, on a limited record, creates a real risk of inconsistent findings in this Third-Party action and the Miriton Third-Party action and the main action.
The Issue
Has Covertite established that there is no genuine issue requiring a trial and is it premature to make this determination?
Analysis
[9] The Court of Appeal has clearly stated that motions for partial summary judgement in circumstances such as are present in this case should be considered a ‘rare procedure’. Justice Pepall explained in Butera v. Chown Cairns LLP, 2017 ONCA 783 (at para 34):
A motion for partial summary judgment should be considered to be a rare procedure that is reserved for an issue or issues that may be readily bifurcated from those in the main action and that may be dealt with expeditiously and in a cost effective manner. Such an approach is consistent with the objectives described by the Supreme Court in Hryniak and with the direction that the Rules be liberally construed to secure the just, most expeditious, and least expensive determination of every civil proceeding on its merits.
[10] GRC’s Third-Party Claim against Covertite is founded on the basis that the actions of Covertite have caused or contributed to the damages claimed against GRC by the plaintiff and is advanced pursuant to the provisions of section 5 of the Negligence Act, R.S.O. 1990, c. N.1 which provides:
Wherever it appears that a person not already a party to an action is or may be wholly or partly responsible for the damages claimed, such person may be added as a party defendant to the action upon such terms as are considered just or may be made a third party to the action in the manner prescribed by the rules of court for adding third parties. R.S.O. 1990, c. N.1, s. 5.
[11] There appears to be credible evidence in the record both supporting and challenging the proposition put forward by GRC that Covertite’s negligence contributed to the damages allegedly incurred by the plaintiff Siemens. These relatively complex and contested technical issues are best adjudicated on a full evidentiary record at trial.
[12] It has been observed that a Third Party may bring a motion for summary judgement on discrete issues, however, such a motion will not be appropriate where the matters to be determined on that motion remain to be determined in the main action or in related proceedings, giving risk to duplicative or inconsistent findings of fact. In the present case the same issues in this Third Party action will have to be tried in the main action and in the Miriton Third Party action.
[13] In a case very similar to the present, Hamilton City v. Thier+Curran Architects Inc., 2015 ONCA 64 Brown J.A. stated at para 23:
In my respectful view, the motion judge committed such an error in principle by granting summary judgment dismissing the Third Party Claims of TCA against Urban and Tricin. In his reasons, the motion judge acknowledged that dismissing the Third Party Claims would not put to rest the issue of any responsibility Urban and Tricin might bear for the construction delays at the project: “delay will still be dealt within the various claims for lien and counter-actions.” The granting of summary judgment dismissing the Third Party Claims creates a risk of inconsistent findings of fact concerning the responsibility of Urban and Tricin for any construction delays. Given that risk, it was an error in principle for the motion judge to view the dismissal of the TCA Third Party Claims as a proportionate means to achieve a just result. The facts concerning the delay issues advanced in the TCA Third Party Claims are too closely intertwined with the facts about delay raised in the main actions involving the Wentworth Lodge project to permit the granting of summary judgment dismissing the Third Party Claims before the main actions have been tried.
[14] The Third Party PCL joins the defendant GRC in opposing Covertite’s motion to dismiss the Third Party Claim. PCL points out that the GRC Third Party claim against it is virtually identical GRC’s Third Party Claim against Covertite. GRC’s Third party claim states in sub-paragraphs 12(a-f):
a. PCL and/or Covertite failed to follow the architectural design and specifications of GRC; b. PCL and/or Covertite altered the architectural design and specifications of GRC; c. PCL and/or Covertite failed to carry out the work in a good and workmanlike manner; d. PCL and/or Covertite failed to obtain the warranty required by GRC during the submittal process; e. PCL failed to ensure that the work of Covertite was carried out in accordance with the architectural design and specification of GRC and in a good and workmanlike manner; f. PCL and/or Covertite failed to take reasonable and appropriate steps to remediate any fault construction of the roof.
[15] I think PCL is correct in observing that dismissing GRC’s Third Party Claim against Covertite will still leave the same overlapping and identical allegations in GRC’s Third Party Claim against PCL. This creates the risk of inconsistent findings of fact should it be determined at the trial of the main action that the Covertite work caused, or contributed, to the plaintiff’s damages. In the decision of the Court of Appeal in Cannacord Genuity Corp. v Pilot, 2015 ONCA 716, dealing with a similar situation, the Court observed:
- The findings of fact necessary to reach a fair and just determination on the merits could not be made in this case without taking into consideration the evidence of the other defendants who were in the same relationship to Cannacord and Colosimo. The possibility of inconsistent verdicts based on the same claims made with respect to the same agreement is real and the concern for substantive justice is significant. Furthermore, given the necessity of trying the same defences put forward by the other defendants as well as Colosimo’s counterclaim, granting summary judgment against Colosimo would not result in any significant reduction in trial time that would be necessary for the adjudication of the balance of the claims and counterclaims. (emphasis added)
Disposition
[16] I am satisfied that granting summary Judgement on this motion dismissing GRC’s Third Party Claim against the moving party Covertite would not achieve any judicial economy in that essentially the same issues would need to be tried in both the main action and The Third party action that the defendant GRC is pursuing against PCL. This would be inconsistent with the objectives identified by the Supreme Court in Hryniak of proportionality, efficiency and cost effectiveness. It would also open the door to conflicting findings of fact, which would be an unacceptable outcome to the administration of justice. In any event Siemens, the Plaintiff in the main action, is not involved in this motion and the technically complex factual issues that are presented in this dispute are wholly unsuitable for adjudication on the incomplete paper record currently available to the court.
[17] In view of my findings, I will not determine a contractual limitation issue also raised by Covertite on this motion (but which has not been pled or examined upon) and will leave that issue to the trial.
[18] The motion by Covertite seeking dismissal of the Third Party action brought against it by the Defendant GRC is dismissed, with costs reserved to the trial judge.
Date: February 19, 2021
COURT FILE NO.: 18-75629-A1 DATE: 20210219 ONTARIO SUPERIOR COURT OF JUSTICE RE: SIEMENS CANADA LIMITED, Plaintiffs AND GRC ARCHITECTS INC. and MIRITON LTD, Defendants AND PCL CONSTRUCTORS CANADA INC., COVERTITE EASTERN LTD. and CLEB CONSULTANT INC., Third Parties COUNSEL: Nadia J. Authier, for the Third Party, Covertite Eastern LTD (Moving Party) John A. Little, for the Defendant, GRC Architects Inc. Iain Peck, for the Third Party, PCL Constructors Canada Inc. ENDORSEMENT (summary judgment motion) Justice Charles T. Hackland Released: February 19, 2021