COURT FILE NO.: CV-20-00000056
DATE: 20211208
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
ANTHONY BARRETT
Plaintiff
– and –
MIKE FRASER A.K.A. MICHAEL FRASER AND C.O.B. AS MIKE FRASER CONSTRUCTION AND RENOVATION
Defendant
M. Kathleen Kinch, for the Plaintiff
No one appearing for Defendant
HEARD: November 22, 2021
REASONS FOR JUDGMENT
Di Luca J.:
[1] The plaintiff, Anthony Barrett, hired the defendant, Mike Fraser, to build a barn on his property. A contract was signed. Materials arrived and Mr. Fraser started building the barn but never finished. He eventually bailed on the job citing delays beyond his control and unspecified health issues.
[2] An action for breach of contract was commenced on June 19, 2020, seeking $105,000 in damages. Mr. Fraser filed a statement of defence. A pre-trial was held on October 13, 2021. Mr. Fraser did not attend, and the matter was set down for hearing during the November sittings. The pre-trial judge, Bale J., noted in his Endorsement, “If the defendant fails to appear at trial, the plaintiff will be entitled to proceed to prove his claim in the defendant’s absence.”
[3] When the matter was called for trial, Mr. Fraser did not attend. Counsel confirmed that the Trial Record had been properly served and further confirmed that she followed up by telephone and left voice messages for the defendant.
[4] In the defendant’s absence, the trial proceeded on the basis of the material filed in the Trial Record, which included the affidavits of Mr. Barrett and a real estate agent, Ms. Amanda Roberts. The Trial Record also included “read-ins” from the transcript of the examination for discovery of Mr. Fraser. The Trial Record was supplemented by the closing submissions of counsel.
Findings and Analysis
(i) Breach of Contract
[5] In February or March of 2019, the plaintiff, Mr. Barrett, met with the defendant, Mr. Fraser, to discuss retaining his services to build a 40x80 foot pole barn on his property. On March 5, 2019, Mr. Fraser provided a written quote for $98,319.09 which included labour, materials and HST.
[6] On the basis of the quote, the parties entered into a signed contract. While the original quote for the barn referenced a size of 40x80 feet, the contract makes reference to a barn that is only 40x60 feet. The terms of the contract include payment of $99,688.50 in four installments of approximately $24,922.00.
[7] The first installment was paid on March 12, 2019. Mr. Barrett believed that work would start on the barn on July 1, 2019, though that did not happen. As it turns out, Mr. Fraser did not submit payment for municipal work permits until July 22, 2019. Mr. Barrett followed up with the municipality and was advised that the permit application that had been submitted was deficient.
[8] Eventually the permits were issued and work began, though not at the pace expected by Mr. Barrett. Given the slow pace of work on the barn, Mr. Barrett was hesitant to provide the second installment, however he did so with payments of $10,000 on September 30, 2019 and $15,000 on October 4, 2019.
[9] Three days later, Mr. Fraser requested the third installment advising that roof trusses would be imminently delivered and work would progress rapidly thereafter. Mr. Barrett complied and provided the third installment on October 11, 2019.
[10] On October 24, 2019, Mr. Fraser began installing steel siding to the frame of the barn. Mr. Barrett noticed that the steel siding was the wrong colour. He advised Mr. Fraser, who acknowledged the mistake and indicated he would order more steel siding to correct the issue.
[11] Given the delays in advancing the project, Mr. Barrett contacted Mr. Fraser’s suppliers directly and learned that trusses had not been ordered until October 8, 2019 and would require six weeks for manufacture.
[12] When the trusses were finally delivered in December 2019, Mr. Fraser advised that he did not have a crew available to install them. On December 12, 2019, Mr. Barrett enlisted two of his friends to assist Mr. Fraser in installing the trusses.
[13] On December 13, 2019, Mr. Fraser advised that he would not be attending at the job site.
[14] On December 16, 2019, Mr. Fraser sent an email advising that he could not complete the job, blaming delays “beyond his control” and “a decline on my health.” Mr. Fraser suggested that the final installment could be given to someone capable of completing the job.
[15] After Mr. Fraser terminated the contract, a number of items remained outstanding including:
a. Ordering and installing windows;
b. Completing installation of trusses to specifications outlined in the building permit;
c. Installing hurricane hangers;
d. Completing strapping;
e. Ordering and installing steel roof;
f. Pouring a concrete floor; and,
g. Grading.
[16] In his examination for discovery, Mr. Fraser admitted that the work on the barn was “unfinished” and explained that the following items remained outstanding: a concrete floor, two overhead doors, the man doors, municipal inspections, window installation and complete the steel work. He also admitted that the timing of his departure from the project resulted in the barn being left open to the elements for the winter. Lastly, he admitted that he was “in over his head” on this project.
[17] When asked to explain where the installments were allocated, Mr. Fraser only had evidence of $13,000 being spent on materials and permits. He acknowledged receipt of approximately $75,000 from Mr. Barrett and conceded that he should return at least $25,000.
[18] Based on the forgoing, there is no issue that Mr. Fraser is liable for breach of contract. On his own admission, he did not fulfill his contractual obligations.
(ii) Damages
[19] Mr. Barrett seeks a variety of damages as a result of Mr. Fraser’s failure to build the barn in accordance with the terms of the contract.
[20] In early 2020, Mr. Barrett retained Sky-High Restoration and Consulting Services to examine the work done by Mr. Fraser and to provide an opinion on any noted deficiencies. While the report prepared was simply appended to Mr. Barrett’s affidavit, the content of the report was put to Mr. Fraser during the examination for discovery and Mr. Fraser testified that he accepted the contents of the report in its entirety. As such, the report has been adopted as an admission against interest and is admissible for the truth of its contents.
[21] According to the report, the following issues were noted:
a. There were large discrepancies between the material quoted and the material actually delivered on site and/or the materials required to complete the project;
b. Insufficient/incorrect material was ordered;
c. The barn constructed was not consistent with the drawing submitted and the building code requirements;
d. The quality of the workmanship was inconsistent and deficient in a number of regards; and,
e. The building was out of square causing issues with the roof trusses and requiring additional material for repair.
[22] Sky-High estimated that $27,912 of material had been used to build the barn. Sky-High further estimated a labour cost of $22,000, for a total value provided of $49,912.
[23] In terms of completing the project to the specifications set out in the proposal, Sky-High estimated costs of approximately $81,200. I note that this amount includes $20,000 for a concrete floor that is not mentioned in the initial estimate, but was clearly the subject of agreement as between the parties. Indeed, the concrete floor is mentioned in several text message exchanges between the parties.
[24] Sky-High also advised that the estimated cost for building the barn as set out in the proposal should have been between $130,000-$150,000. As such, it appears that Mr. Fraser significantly underestimated the costs of building the barn in his initial estimate, even allowing for the permissible overages noted in the contract.
[25] Following receipt of the report, Mr. Barrett hired Sky-High to finish the steel work at a cost of $15,729.60. Mr. Barrett eventually sold his property with the barn uncompleted, though by the time of the sale, the barn had passed municipal inspections.
[26] Mr. Barrett seeks damages of $175,815.77 broken down as follows:
a. The full amount paid to Mr. Fraser - $74,922.14;
b. The amount paid to Sky-High - $15,729.60;
c. Out of pocket expenses for materials included in estimate - $5,164.03; and,
d. Loss of value to the property - $80,000.
[27] In the alternative, he proposes to credit Mr. Fraser for $22,000 in labour and $13,000 in materials, leaving $140,115.76 in damages.
[28] In terms of assessing damages, I note that the damages should place Mr. Barrett in the same position he would have been in had Mr. Fraser completed the barn as set out in the contract.
[29] As such, I find as follows:
a. Mr. Fraser received $74,922.13 from Mr. Barrett. In accordance with the report from Sky-High, I find that Mr. Fraser provided material and labour in the amount of $49,912. He should be credited with this entire amount. This would leave an over payment by Mr. Barrett of $25,010.13. I decline to credit Mr. Fraser with a lower amount based on materials provided in the amount of $13,000. That is the value of materials that Mr. Fraser was able to prove. However, the plaintiff’s own witness pegs the value of materials provided much higher. On this issue, I see no reason to reject the plaintiff’s own witness.
b. I accept that $81,200 would have been required to complete the barn to Mr. Barrett’s satisfaction. That said, I note that $20,000 of this amount is directed to the concrete floor for the barn. While the initial estimate does not provide a cost for the materials for the concrete floor, it is clear from the text exchanges between Mr. Barrett and Mr. Fraser that Mr. Fraser agreed to include a concrete floor. However, the written contract only obliges Mr. Fraser to provide the materials as set out in the estimate. As such, I am unable to find that Mr. Fraser agreed to supply the concrete for the floor, though he agreed to provide the labour. Further, I note that the $20,000 estimate provided by Sky-High does not include a breakdown of labour versus materials. Given the rough 50-50 split between labour and materials on the whole project as quoted by Mr. Fraser, I am prepared to find that $10,000 is an appropriate estimate for the labour involved in completing the concrete floor.
c. While I accept that $71,200 would have been required to complete the barn to the specifications set out in the contract, I note that Mr. Barrett would have been required to pay a final installment of $24,922 in accordance with the terms of the contract. In order to avoid double counting, if $71,200 was required to complete the barn on Mr. Fraser’s side the contract, it is only fair to account for the fact that Mr. Barrett would have been required to make a final payment of $24,922. This leaves a balance of $46,278.
d. I decline to separately award damages for $15,729.60 for the amount paid to Sky-High to conduct some of the remediation work on the barn. This amount is included in the $81,200 estimate provided by Sky-High.
e. Mr. Barrett paid $5,164 for steel, wood, screws, and waste removal in October 2020. All these items were to have been provided by Mr. Fraser in 2019 under the terms of the contract. However, the cost of these additional materials would have been included in the $81,2000 estimate by Sky-High which was dated March 6, 2020, and therefore pre-dated these expenses.
f. In terms of the impact that the unfinished barn had on the value of Mr. Barrett’s property at the time he sold it, I note that the evidence contains an affidavit from Amanda Roberts, the real estate agent who sold the property. She asserts that the incomplete barn reduced the list price by $60,000-$80,000. She provides no basis whatsoever upon which the court can assess her opinion on this issue, other than stating that the incomplete barn was the subject of feedback from multiple buyer’s agents. Nonetheless, she advises that the property sold for $21,000 over asking price. I decline to order any amount in damages in relation to the value of the property. I do so for several reasons. First, Ms. Roberts was not qualified to provide an expert opinion on real estate values. Her evidence on the impact of the incomplete barn is not only conclusory, but it is also grounded in unsubstantiated lay opinion. It is entitled to little, if any, weight. Second, her evidence is that the listing price of the property would have been $60,000-$80,000 higher if the barn had been completed. However, Mr. Barrett chose not to complete the barn before selling the property, despite obtaining a quote from Sky-High to do so. Instead, he chose to spend approximately $21,000 to get the barn in a saleable, though incomplete condition. The choice to proceed in that fashion was his, but in doing so he failed to mitigate his damages. To be clear, I completely understand why Mr. Barrett opted to spend $21,000 to remediate the barn instead of spending $81,200 to complete the barn. However, he cannot now claim the damages that would have resulted had the barn been completely finished.
g. When I combine the numbers, I find that Mr. Barrett is entitled to damages of $25,010.13 for the amount he overpaid in relation to the unfinished barn. I also find that he is owed $46,278.00, which is the amount that Sky-High estimated would be required to complete the barn to the specifications set out in the contract, less the final installment owing on the contract and less $10,000 for the concrete required for the floor. As such, I find that total damages owing are $71,288.13.
[30] Based on the foregoing, I am prepared to order judgment against Mr. Fraser in the amount of $71,288.13 plus pre and post judgment interest and costs. For the purposes of enforcement, I note that the defendant Mike Fraser’s full name is Michael William Fraser.
[31] Counsel has provided a costs outline which includes $2,659.67 in disbursements and full indemnity fees of $12,851.49. On a partial indemnity basis, the fees are $7,710.89. In my view, the fees and disbursements sought are entirely reasonable given the issues at stake and the manner in which the case proceeded. I order costs of $10,500 all inclusive, payable within 30 days.
Justice J. Di Luca
Released: December 8, 2021
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Anthony Barrett
Plaintiff
– and –
Mike Fraser a.k.a. Michael Fraser and c.o.b. as Mike Fraser Construction and Renovation
Defendant
REASONS FOR JUDGMENT
Justice J. Di Luca
Released: December 8, 2021