Court File and Parties

Court File Nos.: CV-20-00643716-0000 and CV-21-00665941-0000 Date: 2022-05-27 Ontario Superior Court of Justice

Between: Court File No. CV-20-00643716-0000 BLACK & MCDONALD LIMITED, Plaintiff – and – EIFFAGE INNOVATIVE CANADA INC., FRANCOIS BORDACHAR, ALIRAZA PIRZADA and SHERRY ALWARD, Defendants

And Between: Court File No. CV-21-00665941-0000 BLACK & MCDONALD LIMITED, Plaintiff -and- LIBERTY MUTUAL INSURANCE COMPANY, Defendant

Counsel: Christopher Afonso and Michael Connolly, lawyers for the Plaintiff, Black & McDonald Limited Julie Rosenthal, and Jill Snelgrove, Lawyers for the defendants, Eiffage Innovative Canada Inc., Francois Bordachar, Aliraza Pirzada and Sherry Alward Laura Delemere and James MacLellan, lawyers for the Defendant, Liberty Mutual Insurance Company

Heard: March 8, 2022

Reasons for Decision

G. DOW, J.

[1] There are two actions commenced in this court with regard to a construction project pertaining to the Alex Fraser Bridge crossing the Fraser River in Delta, British Columbia. The plaintiff, Black & McDonald Limited (“Black & McDonald”) was a sub-contractor to the project. The “Prime Contract” was tendered by British Columbia’s Minister of Transportation to the defendant, Eiffage Innovative Canada Inc. (“Eiffage”). The work was to be completed by June 28, 2019 with provision for monetary deductions if completed thereafter. The defendants, Francois Bordachar, Aliraza Pirzada and Sherry Alward were employees of Eiffage. Francois Bordachar was a Director and CEO of Eiffage. Aliraza Pirzada was the construction manager for the project and Sherry Alward was the subcontracting administrator. The Statement of Claim alleges breaches of trust against them.

[2] Eiffage is an Ontario corporation with offices in Burlington. The Prime Contract to improve and renovate the bridge was for more than $19.2 million including changes. The “Subcontract” between Black & McDonald and Eiffage was for more than $4.7 million. It also included provisions for the work to be done so Eiffage could meet the June 28, 2019 completion date.

[3] Black & McDonald claims it is owed almost $3.5 million including change orders. Eiffage claims the work by Black & McDonald was not done properly or in a timely manner.

[4] The Primary Contract required both a performance bond (“Bond Agreement”) and a labour and materials bond to protect, typically, subcontractors and suppliers, which Eiffage posted through the defendant, Liberty Mutual Insurance Company (“Liberty Mutual”) and is the subject of the companion action.

[5] The work continued beyond June 28, 2019 with each of the parties taking steps to protect its position. This culminated in Black & McDonald issuing and serving Ontario Statements of Claim on the defendants in July, 2020.

[6] Black & McDonald maintains the contract was negotiated and signed by individuals employed by the corporate parties which operated out of their offices in Scarborough and Burlington. Further, invoicing on progress payments were made by Eiffage to Black & McDonald on an account with the Royal Bank of Canada from a branch in Concord, Ontario.

[7] The key provisions in the Prime Contract for the issues to be addressed are: a) GC 80.01 that the contract “shall be governed by and interpreted in accordance with the laws of British Columbia; b) GC 80.02 that Eiffage “attorns itself to the exclusive jurisdiction of the courts of the Province of British Columbia; c) GC 8.09 that “every Sub-Contractor observes the terms of the Contract so far as they apply to that portion of the Work to be performed by that Sub-Contractor; and d) GC9.01(c) that “all disputes” .. “shall be referred to and finally resolved by a single arbitrator following the rules of the British Columbia International Commercial Arbitration Centre for the conduct of domestic commercial arbitration”.

[8] The key provisions of the Subcontract for the issues to be addressed are: a) Article 2.1 that the “requirements, terms and conditions of the Prime Contract as far as they are applicable to the Sub-Contract, shall be binding upon the contractor and the sub-contractor”; and b) SCC 10.2.1 that the “laws of the Place of the Work shall govern the Sub-Contract Work .

[9] The key provisions of the Bond Agreement for the issues to be addressed are: a) Section 3(c) that no action shall be commenced by any claim “other than in a court of competent jurisdiction or in the province or territory of Canada in which the subject matter of the Contract, or any part thereof, is situated and not elsewhere, and the parties agree to submit to the jurisdiction of such Court”

[10] The defendants seek to dismiss or stay the actions on the basis they were not commenced in the proper forum. The plaintiff brought a cross-motion to compel the defendant, Eiffage to participate in arbitration as provided for in the contracts.

Analysis

[11] In accordance with Young v. Tyco International of Canada Ltd., 2008 ONCA 709 (paragraphs 23 to 34), the first question to determine is whether an Ontario Court has jurisdiction over the action. Given the residence of the multiple defendants and the dealings between the parties in Ontario, the defendant conceded jurisdiction simpliciter.

[12] The second question to determine is whether an Ontario Court should entertain the action. This is the forum non conveniens analysis in which the factors used to assess the connection to each forum as part of the motions judge exercising his or her discretion include: a) the location where the contract in dispute was signed; b) the applicable law of the contract; c) the location of witnesses, especially key witnesses; d) the location where the bulk of the evidence will come from; e) the jurisdiction in which the factual matters arose; f) the residence or place of business of the parties; and g) the loss of a legitimate juridical advantage.

[13] As noted, these factors are not exhaustive, the analysis is not mathematical, and the weight given to each factor may be assigned as appropriate.

[14] Further, the three principles to guide the exercise of the juridical discretion are: a) the standard to displace the plaintiff’s chosen jurisdiction is high; b) the balancing of the relevant factor should aim to achieve the twin goals of efficiency and justice; and c) a “prudential” rather than an aggressive approach to fact finding should be adopted because of the early stage of the proceedings.

[15] As part of this approach, the plaintiff’s version of what occurred should be accepted as long as it is reasonable.

[16] Regarding where the Subcontract in dispute was signed, the plaintiff maintains this occurred in Ontario. The residence of the corporate parties and individual defendants re-enforces that position. It supports the admission of the jurisdiction simpliciter and as a factor in favor of assuming jurisdiction and refusing the relief sought by the defendants.

[17] Regarding the applicable law of the contract, I have summarized above the various clauses in the Prime Contract and Subcontract that clearly point to the law of British Columbia being applied and that the parties have attorned to that jurisdiction. In his submission, counsel for the plaintiff raised the absence of any specific forum selective clause in the subcontract. I find that, given the clear statement in the Subcontract in Article 2.1 that the “requirements, terms and conditions of the Prime Contract, as far as they are applicable to the Subcontract, shall be binding upon the contractor and the sub-contractor” to be sufficient to apply to the Subcontract. This factor strongly supports granting the stay sought by the defendants.

[18] Regarding the location of witnesses, especially key witnesses, I must review the submissions made to me by the plaintiff about the post COVID reality that converted court proceedings from in person to virtual. I regard this as a neutral factor. Indeed, the presence of individual defendants and their corporate employers here in Ontario no longer requires the same degree of concern over forcing residents in this jurisdiction to travel beyond their boarders to defend themselves in claims arising from, such as here, construction projects in another province of Canada. I do not agree with the plaintiff’s submission the availability of witnesses outside Ontario to attend virtually somehow undermines the defendants’ position that British Columbia is the more appropriate forum. I do agree this new alternative method of hearing evidence significantly reduces the weight to be given to this factor and does not support the position of either party to any extent.

[19] Regarding the location of where the bulk of the evidence will come from, I acknowledge the plaintiff’s submission about invoices, payments and communication exchanged between the parties here in Ontario. However, that must be balanced by the original source for and the creation of that material which emanated from a renovation and improvement to a major structure crossing the Fraser River in British Columbia as well as the work performed, with paperwork created at that location. Again, this is not seen to be a determining factor or one that significantly favours one side or one jurisdiction over the other.

[20] Regarding the jurisdiction where the factual matters arose, while the plaintiff emphasized and structured their pleading and claim on the lack of payment for work performed and decisions made by individual defendants in this jurisdiction, those decisions relate to construction activity performed in Delta, British Columbia. This is a significant factor in concluding the determination of the issues between the parties be determined in that jurisdiction.

[21] Regarding the residence or place of business of the parties, this has already been addressed and supports the plaintiff’s request it be permitted to proceed with its action in Ontario.

[22] Finally, regarding the loss of a legitimate juridical advantage, the plaintiff failed to demonstrate any substantive difference in the state of the law or what will occur depending on the jurisdiction. Indeed, I would note the final appellate court from each jurisdiction is the same Court.

[23] This is not a situation, like Young v. Tyco International Canada Ltd., supra, where the plaintiff sought to pursue wrongful dismissal damages in Ontario where he had worked for the defendant for almost eight years under Ontario law before being assigned temporary positions in Wisconsin, Georgia and then Indiana, where he was dismissed. It was noted in that decision Indiana, like many American states, permits termination without severance or termination pay.

[24] As a result, although the standard to displace the plaintiff’s choice of jurisdiction is high, it must cede to the principle of efficiency and justice. The allegations of conduct by the individual defendants arose as a result of the contractual terms of the Prime Contract, the Subcontract and the Bond agreement. The terms contained in the Subcontract which incorporated the terms of the Prime Contract clearly anticipated and, I find, that the plaintiff knew or ought to have known its relationship was to be “governed by and interpreted” in accordance with the laws of British Columbia (GC80.01). Further, the parties accepted “the exclusive jurisdiction of the courts of the Province of British Columbia” (GC80.02).

[25] Submissions were made about interpretation of the “Place of the Work”. I have concluded the phrase “laws of the Place of the Work” pertains to what was the source for the payment of money by one party to another, that is the renovation and improvement of the Alex Fraser Bridge crossing the Fraser River in Delta, British Columbia.

[26] The allegations of breach of trust made by the plaintiff against the individual defendants are contained in paragraph 21 of the Amended Statement of Claim. They arise from and are linked to the position held by each individual defendant with the corporate defendant, Eiffage. All of defendants are being represented by the same counsel without any issues between them. Thus I find these claims should not be given separate consideration.

Conclusion

[27] As a result, the motion by the defendants Eiffage Innovative Canada Inc., Francois Bordachar, Aliraza Pirzada and Sherry Alward to stay this action is granted. Similarly, the motion by the defendant, Liberty Mutual Insurance Company to stay the action as against them is granted.

[28] The cross-motion by the plaintiff to compel the Eiffage defendants to participate in an arbitration raised concerns that the Eiffage defendants had refused to respond or proceed with what was provided for in the Prime Contract and Subcontract. I agree with counsel for the Eiffage defendants that should Eiffage not respond, it risks default proceedings as against it in accordance with the rules of the arbitral tribunal in question. I further agree that termination of whether the arbitrator has jurisdiction over the dispute is a matter for the arbitrator at first instances. The cross-motion is thus dismissed.

[29] However, the stay granted by me of these Ontario actions may be revisited should the defendants not abide by the terms of the Prime Contract, Subcontract or Performance Bond or raise issues arising from the passage of time in pursuing the jurisdiction issue in Ontario. I am seized of any such motion to vary my Order.

Costs

[30] Counsel provided their Costs Outlines following submissions. The plaintiff sought partial indemnity fees of $67,711.24 regarding the main motion and an additional $9,768.63 regarding his cross-motion, plus HST as against the Eiffage defendants.

[31] As against the defendant, Liberty Mutual Insurance Company, the plaintiffs sought partial indemnity fees of $10,617.14 plus HST.

[32] The Eiffage defendants sought partial indemnity fees totaling $110,444.36 inclusive of HST plus disbursements of $3,171.92. The defendant, Liberty Mutual Insurance Company sought partial indemnity fees of $20,281.50 plus HST and disbursements of $320.00.

[33] I was not advised of any applicable offers to settle. Given their success, the defendants should be awarded a fair and reasonable amount of its costs. I rely on the direction from the Court of Appeal in Boucher et al v. Public Accounts Council for the Province of Ontario et al, [2004] O.J. No. 2634 (at paragraph 24) that a fair and reasonable amount be determined by consideration of what should be paid by the unsuccessful party rather than any exact measure of the actual costs of the successful litigant.

[34] To that end, I would reduce the claim by the Eiffage defendants and award them costs in the amount of $68,711.24 plus HST of $8,932.46 and their disbursements of $3,171.92 for a total amount of $80,815.62.

[35] Regarding the defendant, Liberty Mutual Insurance Company, I would award them $10,617.14 plus HST of $1,380.23 and the disbursements of $320.00. for a total amount of $12,317.37.

[36] Both awards are payable forthwith.

Mr. Justice G. Dow Released: May 27, 2022