Ontario Superior Court of Justice

Court File No.: CV-24-00713690-0000
Date: 2025-06-25

BETWEEN:
Ranjani Venkataramani, Plaintiff
– and –
Abdulla Abdul Fatah, 5053767 Ontario Inc., John Doe Construction Corp, and Golden Seal Construction Corp., Defendants

Appearances:
Mary Paterson and Rohan Shah, for the Plaintiff
Heard: In Writing

Judge:
M.A. Sanderson

Introduction

[1] This is a motion in writing for default judgment.

[2] I have reviewed the motion record filed on Case Center in support of the Plaintiff’s, Ms. Ranjani Venkataramani’s (hereinafter “Ms. V”), motion for default judgment, including the Statement of Claim, her two affidavits affirmed January 31, 2025 and February 6, 2025, and Exhibits thereto, including her chronology of events and her damages and costs calculations.

Chronology

[3] In 2021, Ms. V decided to renovate her home.

[4] She wanted to be able to rent part of her basement to generate income during her anticipated upcoming retirement and also to update portions of the main and upper floors of her house, including her kitchen.

[5] On September 9, 2021, Ms. V posted an ad on the Smart Reno website.

[6] On September 14, 2021, a Mr. Fatah (hereinafter “Mr. F”), the sole director and shareholder of the corporate defendant/numbered company 5053767 Ontario Inc. operating as Apolo and Co. (hereinafter “Apolo”), visited her at home at 165 Collingsbrook Boulevard, Toronto (see Statement of Claim paragraph 16).

[7] Mr. F provided Ms. V with a two-part quote of $38,500 for Apolo to do renovations in her basement, and of $56,700 for renovations on her main and upper floors (hereinafter the “specified renovations”).

[8] The Plaintiff, Ms. V, believed that Apolo was a reputable, experienced, insured contractor.

[9] She negotiated a contract for the specified renovations for a total price of $75,000.

[10] On September 23, 2021, Ms. V entered into the contract with Apolo (see Statement of Claim paragraph 20).

[11] The contract recites that Apolo was an approved, licensed, insured construction renovation company in good standing.

[12] The contract set out the scope of work (Statement of Claim paragraph 22) and estimated time for completion of the renovations (two months). Apolo agreed to complete the renovations within that timeline.

[13] The contract contained a payment schedule (Statement of Claim paragraphs 23-24) and a liquidated damages clause in the event of delayed completion/$150 per day (see Statement of Claim paragraph 25).

[14] In her affidavit filed in support of her motion for default judgment, Ms. V has deposed that on September 26, 2021, to pay for the specified renovations she took out a second mortgage on her home for $75,000 at a variable interest rate (changed on December 29, 2022 to a fixed rate of 5.69%).

[15] Ms. V has deposed that on the same day she advised Mr. F that she wanted to rent out the renovated basement for extra income during retirement.

[16] Apolo was incorporated on September 29, 2021.

[17] Shortly after the contract was signed, Apolo started some of the work, but there were permitting delays (paragraphs 29-31). No building permit was issued until December 7, 2021.

[18] There were other delays. Toronto Hydro did not upgrade the electrical panel in the basement until February 22, 2022.

[19] Although the electrical delay is not mentioned in the Statement of Claim, Ms. V now concedes in her affidavit that the timing of the upgrade of the electrical panel in the basement was beyond Apolo’s control and that the expected date of completion to be used in her delay calculations should be April 22, 2022, two months from the date of the electrical panel upgrade by Toronto Hydro on February 22, 2022.

[20] In July 2022, Apolo had still not completed the renovations (Statement of Claim paragraph 33, Affidavit paragraph 36).

[21] Ms. V’s affidavits in support of her request for default judgment contain details of communications/emails with Apolo about delays.

[22] On Apolo’s last day of attendance at her home, September 14, 2022, the renovation remained incomplete (affidavit paragraph 40).

[23] Ms. V paid Apolo $63,750 (the contract price minus $11,250) towards the contract price.

[24] Ms. V has many complaints about the poor quality of Apolo’s work.

[25] On October 20, 2022 (see Statement of Claim paragraph 40, affidavit paragraph 53), Ms. V made a formal complaint to the Ministry of Public and Business Service Delivery.

[26] On May 25, 2023, with help from Pro Bono Ontario, she made a written demand to Apolo (see Case Center A-373): “Please treat this letter as formal legal demand that you compensate me for breaching your contractual obligation to me. I estimate my losses are $33,750” (Affidavit of Ms. V Exhibit EE paragraph 56).

[27] On July 5, 2023, she served notice on Apolo and Mr. F of her intention to seek damages under s.18 of the Consumer Protection Act (see Affidavit paragraph 57) as well as a Notice of Termination. At that time (Case Center - A378-379), she included an itemized list of deficiencies and was estimating her damages at $112,250, composed of repair costs of $57,500 plus liquidated delay damages of $54,750 ($150 per day from February 7, 2021 to September 14, 2022).

[28] On January 29, 2024, the Statement of Claim herein was issued against Apolo and Mr. F.

[29] In it, the Plaintiff claimed damages to be determined at trial against Apolo for Breach of Contract and against both Apolo and Mr. F for breach of the Consumer Protection Act (“the CPA”), negligence, negligent representation, and punitive damages of $50,000.

[30] Mr. F was served with the Statement of Claim on January 31, 2024 and Apolo was served on February 1, 2024.

[31] Neither Apolo nor Mr. F filed Statements of Defence within the deadlines specified under the Rules of Practice.

[32] Counsel for the Plaintiff noted both Defendants in default on April 2, 2024.

[33] On February 6, 2025, the Plaintiff brought this motion for Default Judgment under the Simplified Procedure.

[34] The Plaintiff has complied with the order of Koehnen J. requiring service on Apolo and Mr. F of the motion record and endorsement.

[35] The Defendants did not respond or indicate that they intended to oppose the motion within the timelines specified in the order of Koehnen J.

[36] Therefore, this Motion for Default Judgment was scheduled to be dealt with in writing, and on April 15, 2025 was referred to me for resolution.

Analysis and Law

Default Judgment Generally

[37] Rule 19.02(1) provides that a defendant who has been noted in default is deemed to admit the truth of all allegations of fact made in the Statement of Claim.

[38] Rule 19.05 provides that a judge may grant judgment, dismiss an action or order that an action proceed to trial.

[39] Rule 19.06 provides that a plaintiff is not entitled to judgment merely because the facts alleged in the Statement of Claim are deemed to be admitted, unless those facts entitle the plaintiff to judgment.

[40] Stated differently, liability does not flow automatically to the plaintiff after a defendant has been noted in default. The facts that have been pleaded in the Statement of Claim deemed to be admitted must entitle the plaintiff to judgment at law.

[41] Only when the applicable legal tests applied to the facts deemed to be true have been met is the Court to sign default Judgment.

[42] Strathy J. as he then was in Salimijari v. Pakjou wrote at paras. 30-34, that the duty of the court to absent defendants and the public on default judgment motions is to ensure that manifestly unsustainable claims are not mechanically processed.

Application of the Test Here

[43] In the Statement of Claim, the Plaintiff claimed damages to be determined at trial against Apolo for Breach of Contract and against both Apolo and Mr. F for breach of the Consumer Protection Act, negligence and negligent representation and punitive damages of $50,000.

[44] In its factum, counsel for the Plaintiff claimed jointly and severally against Mr. F and Apolo in the amount of $270,106.60 for Breach of the CPA, alternatively against Apolo for $270,106.60 for Breach of Contract, alternatively jointly and severally against Mr. F and Apolo for $135,600 for negligence, or alternatively $63,750 for Negligent Misrepresentation, jointly and severally against Mr. F and Apolo for punitive damages of $10,000, costs of $24,987.80 plus taxes.

[45] As the Plaintiff has claimed against the Defendants Apolo and/or Apolo and Fatah based on several alternative causes of Action, I shall go through the deemed admissions of fact and tests to be applied with regard to each cause of action pleaded.

Liability of Officers / Directors Generally

[46] In Khursheed v. Venedig Capital, 2019 ONSC 5190, paras 26-28 Nishikawa J. wrote:

[26] The case law makes clear that unless there is an independent cause of action against them, officers, directors and employees are protected from personal liability for acts carried out under a corporate name. As the Court of Appeal stated in ScotiaMcLeod Inc. v. People’s Jewellers Ltd., 26 O.R. (3d) 481 (C.A.), at pp. 490-491:

The decided cases in which employees and officers of companies have been found personally liable for actions ostensibly carried out under a corporate name are fact-specific. In the absence of findings of fraud, deceit, dishonesty or want of authority on the part of employees or officers, they are also rare. … In every case, however, the facts giving rise to personal liability were specifically pleaded. Absent allegations which fit within the categories described above, officers or employees of limited companies are protected from personal liability unless it can be shown that their actions are themselves tortious or exhibit a separate identity or interest from that of the company so as to make the act or conduct complained of their own.

[27] The Court of Appeal went on to say that a corporation’s directors or officers may cause it to sign a contract, since a corporation can only operate through human agents. However, this does not mean that “if the actions of the directing minds are found wanting, that personal liability will flow through the corporation to those who caused it to act as it did”: Scotia McLeod v. People’s Jewellers, at p. 491.

[47] FNF Enterprises Inc. v. Wag and Train Inc., 2023 ONCA 92 dealt with a Rule 21 motion.

[48] The Motions judge in that case had to determine, whether, assuming the facts pleaded were true, it was plain and obvious that each of the plaintiffs' pleaded claims disclosed no reasonable cause of action.

[49] On the issue of piercing the corporate veil, Zarnett JA for the Ontario Court of Appeal wrote:

[14] The motion judge accepted that the gist of the pleading was to allege that:

[The] defendants vacated the premises early and without cleaning up, stopped paying rent, gave no notice and declined to answer all communications. They started up the same business in plain sight nearby. [Ms.] Ross is the sole shareholder and director of the corporation and treats its earnings as her own. It is alleged that these acts constitute fraud or improper conduct designed to avoid paying amounts properly owing.

[15] However, he considered that the facts pleaded:

… do not disclose an actionable tort committed by [Ms.] Ross. Nor do they disclose fraud or improper conduct, or conduct by her that exhibits a separate identity from that of the corporation. If what is pleaded is true, she caused her closely-held corporation to breach its contract. She did not cause the corporation to disappear. [Ms.] Ross’s conduct does not rise to such a level that application of the logic of Salomon would lead to a result that is flagrantly opposed to justice. I find it plain and obvious that the action cannot succeed against her personally.

[17] Piercing or lifting the corporate veil is an equitable exception to certain statutory rules. Those rules provide that a corporation is a separate legal person (with the consequence that its property, rights, and obligations are its own, not those of the individuals through whom it acts)…

[18] The test for piercing the corporate veil in Ontario is that set out in Transamerica Life Insurance Co. of Canada v. Canada Life Assurance Co., aff’d [1997] O.J. No. 3754 (C.A.). That case set out a two-part test, at pp. 433-34: “courts will disregard the separate legal personality of a corporate entity where it is completely dominated and controlled and being used as a shield for fraudulent or improper conduct.”… Ms. Ross’ control of Wag and Train and her decision that it breach the Lease was held not to satisfy the improper conduct aspect of the Transamerica test.

[50] In Kosmopoulos v. Constitution Insurance Co., Wilson J. of the Supreme Court of Canada wrote at para 12:

As a general rule a corporation is a legal entity distinct from its shareholders: Salomon v. Salomon & Co., [1897] A.C. 22 (H.L.) The law on when a court may disregard this principle by "lifting the corporate veil" and regarding the company as a mere "agent" or "puppet" of its controlling shareholder or parent corporation follows no consistent principle. The best that can be said is that the "separate entities" principle is not enforced when it would yield a result "too flagrantly opposed to justice, convenience or the interests of the Revenue"…

[51] To summarize, generally, the civil liability of directors and other officers of a corporation is different from that of the natural person. The corporate structure usually offers corporate directors, officers, and shareholders protection from personal liability. A plaintiff is normally limited to seeking to collect against the assets of the corporation itself. That said, directors and officers may be held personally liable for conduct related to the corporation if they are implicated in behaviour so egregiously wrong or illegal that protecting them is morally repugnant (e.g. fraud).

Liability for Breach of Contract

[52] I have considered whether the pleadings and affidavit support a finding of liability for breach of contract against Apolo or Mr. F or both.

[53] In my view, it is noteworthy that at paragraph 48 of the Statement of Claim the Plaintiff claims damages for breach of contract against Apolo only.

[54] In the factum herein, the Plaintiff does not seek to attach liability to Mr. F for breach of contract. If there is no liability against Mr. F for breach of contract, he should not be required to pay damages for breach of contract. (This is relevant because in the Notice of Motion for Default Judgment, the Plaintiff does seem to be seeking to have this Court find liability and allow her to recover some contractual damages against both Mr. F and Apolo.)

[55] At paragraph 4 the Plaintiff alleged the following breaches of contract: (a) failing to complete and abandoning the Renovations; (b) failing to advance the Renovations in a timely manner and causing delays; (c) failing to supply the necessary manpower to complete the renovations; (d) failing to perform its work in a good and workmanlike manner; (e) failing to ensure due and proper execution of the Renovations; and (f) failing to adequately manage the renovations or at all during construction.

[56] I note that there is no specific pleading in the Statement of Claim regarding Mr. F’s activities separately from Apolo, nor is there any allegation that breaches (a)–(f) above constituted an independent tort committed by Mr. F (except possibly allegations of negligence and negligent misrepresentation). There is no pleading that Mr. F’s actions were separate from Apolo’s in a manner to make them his own.

[57] I am satisfied that the facts alleged in the Statement of Claim deemed to be admitted support a finding that Apolo breached the contract as specified.

[58] I am not satisfied on the present pleading and affidavit evidence that default judgment now against Mr. F personally for breach of contract is warranted.

Claims for Unliquidated Contractual Damages Generally

[59] The quantum of unliquidated damages awarded must be fair and appropriate in the circumstances (Churchill v. Aero Auction Sales Inc., 2019 ONSC 4766, para 1).

Overall Quantum of Damages Claimed for Breach of Contract

[60] The Plaintiff in her Notice of Motion is seeking default judgment in breach of contract for $271,756.60. In her affidavit at paragraph 78 and in her factum she is claiming $270,106.60 for breach of contract.

[61] The amount of her claim for breach of contract has greatly increased over time.

[62] On May 25, 2023, as mentioned earlier, in a written demand that Apolo compensate her (Case Center A373), she estimated her damages then at $33,750 (Affidavit of Ms. V Exhibit EE paragraph 56).

[63] By July 5, 2023 (see Affidavit paragraph 57), Ms. V (Case Center p A378) was estimating her contractual damages at $112,250 composed of repair costs of $57,500 plus liquidated delay damages of $54,670.

Specific Claims for Unliquidated Damages

(a) Cost of Completing the Contracted Renovations and Remedying the Deficiencies in the Work Already Completed

[64] The first element of her contractual claim is a claim for the repair/curing deficiencies portion of her unliquidated damages claim.

[65] Ms. V seeks default judgment against Apolo for $135,600 (Case Center A-409). At paragraph 43 of the Statement of Claim the Plaintiff alleges that there were numerous deficiencies in various aspects of the Renovations, including but not limited to: (a) uneven tiling and leaking in the drywall in the basement bathroom, (b) insecure placement of rods in the stairwell connecting the main and second floor, (c) improper and incomplete installation of the exhaust unit, and (d) inadequate and incomplete installation of the laminated veneer lumber for beams in the main floor.

[66] The affidavit of the Plaintiff filed in support of this motion outlines additional deficiencies. However, Ms. V made it clear in her affidavit that under the contract, Apolo installed floors in the basement, albeit imperfectly, except under the stairs, and installed a bathroom including a shower and sink, but that the shower leaked and the taps on the sink were mixed up.

[67] Her estimate of this aspect of her damages claim—cost of completion and correcting her list of deficiencies—has varied over time from $33,750 on May 25, 2023, to $57,500 on July 5, 2023. She now claims $135,600.

[68] To support her claim for cost of completion and of repairs, Ms. V sought quotes from four contractors.

[69] She made it clear at paragraph 75 of her affidavit that in seeking the four estimates of repair costs from the four contractors included as exhibits that they did not comport with the list of work needed that she had prepared: “…with the help of my lawyers I prepared an itemized list of areas of work…that need to be completed and or repaired and shared it with numerous contractors. Unfortunately, every single contractor I contacted refused to use the list I prepared as a basis for preparing their quotations.”

[70] She deposed at paragraph 76 that the contractors’ quotes were based on their assessments of my home and how they wanted to break down the work that needs to be completed and repaired.

[71] In other words, she seemed to be acknowledging that the contractors’ estimates she has provided to this Court as the basis for determining completion and repair costs do not strictly track her list of renovations done and deficiencies she believes need to be corrected under the contract.

[72] The quotes provided by the four contractors (Exhibits II, JJ, KK, LL) range from $71,883.09–$120,000 without tax / $81,227.89–$135,600 inclusive of tax.

[73] For (a) the repair/curing deficiencies portion of her unliquidated damages claim, Ms. V bases her claim for $135,600 default judgment against Apolo on the estimate provided by KS Homes (Case Center A-409).

[74] I note that the KS Homes’ estimate for the basement includes not just the correction of the deficiencies but also removal of all the flooring and baseboards installed by Apolo pursuant to the contract, demolition of the bathroom installed by Apolo, building and outfitting of a completely new bathroom, and installation of new vinyl floors and baseboards throughout the basement.

[75] In my view, given the content of Ms. V’s affidavit, the KS Homes estimate covers work and costs beyond what Ms. V deposed was needed to finish the specified renovations and to repair any deficiencies in them.

[76] While it would have been preferable to have more and better evidence on these costs, this is a Simplified Rules case.

[77] The Court should attempt to do the best it can to assess the damages as inexpensively and expeditiously as is reasonably feasible.

[78] While they do not strictly track the work completed and the work she believes is needed to remedy the deficiencies, the four quotes, taken together, along with the Plaintiff’s lists of the work done under the contract and needing to be completed, and the photographs in Appendix A in my view do provide a sufficient evidentiary basis for extrapolating and determining the cost of completing the specified renovations and correcting the deficiencies.

[79] Based on that evidence and the pleading deemed to be admitted, partial Default Judgment against Apolo for Breach of Contract for this aspect of her claim is warranted in the amount of $80,000.

(b) Unliquidated Breach of Contract Damages Claimed for Delay (i) Loss of Rental Income

[80] In her Statement of Claim at paragraph 64, Ms. V pleaded that as a result of Apolo’s and Mr. F’s failure to properly finish her basement as promised, she could not rent it out as planned. (Here she appears to be seeking an aspect of damages for delayed completion against Mr. F personally although she has only claimed against Apolo for the cost of repairs.)

[81] At paragraph 65 of her Statement of Claim: Apolo and Mr. F personally knew or ought to have known that the failure to properly complete the basement work would prevent Ms. V from renting it out. As a result, the Defendants are liable for Ms. V’s loss of rental income.

[82] Even assuming that rental loss could be compensable for the reasons set out earlier, I would not find liability against Mr. F for this aspect of a breach of contract claim on the pleading and affidavit to date.

[83] On quantum of damages at paragraph 86 of her affidavit Ms. V deposed: “I could have been renting the basement as of May 1, 2022 had Apolo completed the renovation properly.”

[84] At paragraph 88 of her affidavit she deposed: Between May 1 and date of this affidavit, I estimate the loss of rental income to be approximately $49,401 which I calculated by multiplying the number of months between May 1, 2022, and the date of this affidavit—1006 days—so around 33 months and the monthly rental income of $1,497.

[85] As proof of her rental loss (affidavit paragraph 88) she annexed Exhibit MM (Case Center page A-418)—a GTA May 2022 Rent Report showing an average rental price in Scarborough for a one-bedroom apartment of $1,497 per month.

[86] I do not find Exhibit MM to be an adequate evidentiary basis on which to base default judgment now for $49,401 for this head of damages.

[87] From the diagrams in the Record of the basement area and the details of the renovations to be done under the contract, it appears she was not comparing apples and apples. Even after the renovations were complete, the area in her basement to be rented would not have included a complete apartment with a kitchen and living area comparable to the one bedroom comparator mentioned in Exhibit MM.

[88] Is there a sufficient basis in the evidence to determine reasonable rent for a downstairs room and a bathroom?

[89] Ms. V deposed about an earlier intention to charge $800 per month rent for that space. However, she provided no evidentiary basis upon which this court could reasonably conclude that $800 per month would have been a reasonable market rate for such space.

[90] Even considering that this is a Simplified Rules Case, I am unable, without further evidence, to fairly quantify this aspect of the damages claim.

[91] It follows that I cannot give default judgment now for this and that if so advised the Plaintiff must pursue this aspect of her claim in the usual course.

(c) Unliquidated Delay Costs—Contractual Claim for Cost of Additional Interest Paid

[92] The Plaintiff seeks unliquidated damages of $19,255.60 against Apolo and Mr. F for additional interest costs paid as a result of Apolo’s breach of contract.

[93] This is arguably another contractual delay claim because she alleges it arose because of delayed completion of the renovations.

[94] At Paragraph 46 of the Statement of Claim the Plaintiff pleaded: “…not only is she unable to supplement her income by renting her basement she must continue working to pay off her second mortgage because of extra interest costs she has incurred as a result of being unable to rent out her basement starting on May 1, 2022.”

[95] In her affidavit (at paragraph 94) she deposed that she used a mortgage calculator to determine the amount of this claim.

[96] Had she had been receiving the $800 per month rental (at paragraph 93) that she originally intended to charge, she alleged she could have paid her second mortgage down by $800 per month starting in May of 2022 and by the date of her affidavit in early 2025 she would have saved $19,255.60 in interest payments.

[97] Again, even assuming that lost interest could properly be included in her contractual claim, no sufficient evidentiary basis for the $800 per month has been provided upon which default judgment for this amount would be warranted.

[98] Again, if the Plaintiff wishes to pursue this claim, I am of the view that this aspect of action must proceed in the ordinary course.

Claim for Liquidated Damages for Contractual Delay

[99] The Plaintiff also seeks liquidated damages of $150 per day.

The Legal Test to be Applied

[100] In her Statement of Claim at paragraphs 48 and 49, Ms. V has pleaded: Apolo is liable for $76,950 arising from the $150 per day penalty that started to accrue on February 27, 2022 (the day Ms. V anticipated the renovations would be complete) and stopped accruing July 5, 2023 (the day Ms. V cancelled the contract).

[101] In her affidavit at paragraph 81 Ms. V deposed: “Under the contract I am allowed to deduct $150 per day for each day the renovations are incomplete after the anticipated completion date.” She claimed liquidated damages over 439 days April 22, 2022–July 5, 2023 = $65,850.

[102] Before liquidated damages clauses in contracts will be held to be enforceable it must be shown that the liquidated damage charge in the contract—here $150 per day—is a realistic estimate of the damages that the Plaintiff would suffer in the event the renovations were not completed within the two months estimated for completion. (HF Clarke Ltd. v. Thermidaire Corp.)

[103] Here, no evidence has been adduced to illustrate that $150 per day is/was a realistic estimate nor has a logical rationale for the inclusion of the number of days for the period chosen been provided.

[104] I am not satisfied that default judgment for liquidated damages now is warranted.

[105] If so advised, pursuit of that claim may proceed in the ordinary course.

Duplicative Delay Claims

[106] In my view, to recover contractual delay damages here, the Plaintiff must either prove with adequate evidence and argument that she meets the test for recovering liquidated damages for delay (and abandon her claim for unliquidated contractual damages for delay) or she must prove with adequate evidence and argument her claim for unliquidated damages for delay (and abandon her claim for liquidated damages). She cannot recover both.

Claim for Default Judgment for Breaches of the Consumer Protection Act

[107] In her factum, counsel for the Plaintiff sets out her claim in addition, or in the alternative, for Default Judgment of $271,756.60 for damages against both Apolo and Mr. F under the Consumer Protection Act.

[108] The Plaintiff seeks default judgment against Apolo as supplier and Mr. F as agent, on the basis that they breached the warranty they provided to the Plaintiff under s. 9(1) of the Consumer Protection Act and that Apolo and Mr. F engaged in misleading or deceptive representations contrary to s. 14(1) and 17(1) of the Consumer Protection Act in that they represented that the renovations would be completed in a timely manner, to a quality standard, and that Apolo was insured. She seeks damages under s. 18.

[109] The Plaintiff has pleaded that this is a consumer agreement between supplier and a consumer under s. 9(1) of the CPA.

[110] Under the Act, a supplier is defined as a person who is in the business of selling goods or services…and includes an agent of the supplier and a person who holds himself out to be a supplier or an agent of the supplier.

[111] Under s. 9(1) a supplier is deemed to warrant that services supplied under a consumer agreement are of a reasonably acceptable quality.

[112] Section 18(1) of the Consumer Protection Act provides: any agreement, whether written, oral or implied, entered into by a consumer after, or while a person has engaged in an unfair practice, may be rescinded by the consumer, and the consumer is entitled to any remedy that is available at law, including damages.

[113] Section 18(2) provides: a consumer is entitled to recover the amount by which the consumer’s payment under the agreement exceeds the value that the goods or services have to the consumer or to recover damages, or both, if rescission of the agreement under subsection (1) is not possible.

[114] Section 18(12) provides: Each person who engaged in an unfair practice is liable jointly and severally with the person who entered into the agreement with the consumer for any amount to which the consumer is entitled under this section.

[115] Counsel for the Plaintiff has submitted that since Apolo had not been incorporated at the time the contract was entered into, Mr. F was a supplier in his personal capacity.

[116] I do not accept that submission. The work complained of was done by Apolo after it was incorporated.

[117] Counsel for the Plaintiff has submitted in the alternative that Mr. F is caught within the definition of supplier because the definition includes persons who hold themselves out to be suppliers or agents of supplier. (See: Statement of Claim paragraph 69.)

[118] As sole director of Apolo Mr. F may not technically have been an agent of Apolo. See Corporate Officers as Agents Harvard Law School Forum February 24, 2017 Deborah De Mott wrote: As rightly observed by Justice Jessel MR in Great Eastern Railway v. Turner LR 8 Chancery D 149 that the directors have sometimes been called trustees or commercial trustees, and sometimes they have been called agents. It does not much matter what you call them so long as you understand what their true position is, which is that they are commercial men managing a trading concern for the benefit of themselves and all other shareholders in it. We should truly understand their roles as director in whole and refrain ourselves to term them as agent or trustee in true legal terms. It can be concluded that directors are neither agents nor trustees in true legal terms. However, they possess elements of agency, trusteeship in their nature of duty but none of these terms can describe directors in their position in totality. The role of director involves combination of agency, trusteeship, but do not make him an agent or trustee in its real sense.

[119] Directors and officers will generally not be held civilly liable under the CPA except under the usual piercing the corporate veil standard.

[120] Were I deciding this issue in the absence of deemed admissions in the pleading, given the caselaw to the effect that Mr. F is not technically an agent of Apolo, I would have required further proof that Mr. F expressly held himself out as an agent of Apolo.

[121] However, the Plaintiff has pleaded at paragraphs 69-70 of the Statement of Claim (that must be deemed to be true) that Mr. F held himself out to be an agent of Apolo, breached the warranty and failed to provide renovation services to a reasonably acceptable quality.

[122] The combined effect of the deemed admission in paragraphs 69-70, the definition of supplier and of s. 18(12) seems to make both Apolo and Mr. F liable to pay damages for unfair practices and misrepresentations under s. 9(1), s. 14(1), s. 17(1) and s. 18(12) of the CPA.

The Notice Provision

[123] Section 18(3) provides: a consumer must give notice within one year after entering into an agreement if (a) a consumer seeks to rescind the agreement under ss (1) or (b) the consumer seeks recovery under ss2 if rescission is not possible.

[124] Section 18(15) provides: If a consumer is required under this Part in order to obtain a remedy a court may disregard the requirement to give notice if it is in the interest of justice to do so.

Notice Here

[125] Notice was not given here until July 2023. The Plaintiff did not give notice within one year as required.

[126] Given that Ms. V was not represented at the time she failed to give notice and that the CPA is a consumer protection statute, to be broadly and liberally construed, I am of the view that in the interests of justice I should disregard the notice provision here as authorized under s. 18(15). (Wright v. United Parcel Service Canada Ltd., 2011 ONSC 5044)

Damages Under the CPA

[127] Given that the unfair practices, misrepresentations, etc. alleged under the CPA are said to have caused Ms. V to enter into the contract, the quantification of damages claimed in contract and under the CPA are similar, and the considerations already mentioned in respect of the contractual damages claim apply to her claim under the CPA, except that I have held both Apolo and Mr. F to be jointly and severally liable under the CPA.

[128] I therefore am prepared to award partial default judgment now against Apolo and Mr. F under the CPA for the same $80,000 awarded earlier in breach of contract against Apolo only.

[129] For the reasons mentioned earlier, if so advised, Ms. V may pursue the balance of her CPA damages claim for unliquidated damages and punitive damages in the usual course.

Liability of Apolo and Mr. F for Negligence

[130] The Plaintiff has pleaded in her Statement of Claim at paragraph 54 that Apolo acted negligently.

[131] She pleaded at paragraph 57 of the Statement of Claim that it was foreseeable that Apolo’s negligence would result in Ms. V’s damages in an amount to be determined at trial.

[132] I accept that Apolo owed Ms. V a duty of care as a general contractor.

[133] I accept that breach of the standard of care/failure to do the renovations in a reasonably competent matter would result in foreseeable damages.

[134] To that extent, I award default judgment for negligence against Apolo.

Liability of Mr. F for Negligence

[135] Ms. V pleaded (inconsistently with paragraph 57) at paragraph 55 that Apolo and Fatah owed a duty of care to perform renovations to the standard of a reasonably competent contractor in the circumstances and that Apolo and Mr. F breached the Standard of Care by (a) failing to perform aspects of the renovation in a good and workmanlike manner free of deficiencies and (b) failing to make proper onsite quality control during performance of the renovations.

[136] At paragraph 59, she pleaded that as general contractors Apolo and Mr. F owed a duty of care to Ms. V.

[137] In law Mr. F was not a general contractor. A pleading to that effect does not make him so.

[138] That pleading is insufficient to make Mr. F liable in his personal capacity for Negligence.

[139] In her pleading on Negligence again she does not specifically plead facts sufficient to warrant piercing of the corporate veil, nor has she pleaded sufficient facts to support a finding of Mr. F’s engaged in negligent acts separate from the conduct of Apolo such as to make the conduct complained of his own.

[140] Default judgment against Mr. F for negligence is not warranted at this time.

Damages Against Apolo for Negligence

[141] Just as with her damages calculations for breach of contract, apart from the $80,000 cost of completing and repairing the renovations already ordered to be paid by Apolo, the balance of her damage calculations for negligence are insufficiently grounded on the evidence to warrant default judgment damages for negligence at this stage of the proceedings.

[142] I therefore award partial default judgment against Apolo in the same amount of $80,000 for negligence. I do not award this amount in addition.

Negligent Misrepresentation

Liability

[143] At paragraph 59, Ms. V pleaded that as general contractors, Apolo and Mr. F owed a duty of care to Ms. V.

[144] At Paragraph 60 Ms. V pleaded that Apolo and Mr. F made several negligent misrepresentations to Ms. V.

[145] At paragraph 65: Apolo and Mr. F stated numerous things during the negotiation of the contract that turned out to be untrue, including that they were qualified, Apolo had general liability insurance, and Apolo had been in business for many years.

[146] In her affidavit at paragraph 19: In the contract Apolo said that Apolo is approved licensed, Golden Seal is fully insured, the estimated time for the renovations was two months, and would complete the renovations under the timelines in the contract.

[147] At paragraph 62: Ms. V relied on the representations to her detriment, as she suffered damages from hiring a general contractor who was not properly qualified to do the renovation. But for the representations …she would never have considered entering into a contract with a contractor who may not be properly insured. She then continued: knew or ought to have known that the Plaintiff was relying on their representations in selecting contractor.

[148] Ms. V would not have entered into the contract but for Apolo’s negligent misrepresentations.

[149] However, she expressly conceded that she understood that she was looking to the company Apolo, not Mr. F in the event the representations turned out to be misrepresentations.

[150] At paragraph 69 of her affidavit, she deposed: To be sure I wanted to be sure that whatever company I chose to complete the renovations had enough experience and was qualified [emphasis added].

[151] It follows that Ms. V did not rely on Mr. F being the contractor.

[152] Her claim for default judgment now against Mr. F personally for negligent misrepresentation must fail on that basis.

[153] I have already referred to Khursheed v. Venedig Capital, 2019 ONSC 5190, paras 26-28.

[154] Further, and again at para 28 of the same decision:

In order to properly plead a cause of action against the directors or officers of a corporation, a separate claim must be stated against the individuals in their personal capacity…The statement of claim must allege actions conducted by the individuals which are themselves tortious or exhibit a separate identity or interest from that of the corporation so as to make the act or conduct complained of their own.

[155] Here the Statement of Claim does not specifically plead sufficient facts upon which this court could reasonably conclude that in making the representations admittedly about Apolo, Mr. F exhibited a separate identity or interest from that of the corporation so as to make the act complained of his own.

[156] Again, there are insufficient allegations to support a legal conclusion that the corporate veil should be lifted in respect of the negligent misrepresentation allegations.

[157] At para 16 of Khursheed v. Venedig Capital, 2019 ONSC 510 is contained the following:

Section 4 of the Statute of Frauds provides that “[n]o action shall be brought … to charge any person upon any special promise to answer for the debt, default or miscarriage of any other person … unless the agreement upon which the action is brought, or some memorandum or note thereof is in writing and signed by the party to be charged therewith or some person thereunto lawfully authorized by the party…”

[158] In sum, the pleading of negligent misrepresentation does not support a partial default judgment against Mr. F now.

[159] I accept that Ms. V relied on Apolo’s negligent misrepresentation and that she would not have entered into the contract but for that misrepresentation.

[160] The pleading does support partial default judgment against Apolo for negligent misrepresentation.

Damages For Negligent Misrepresentation

[161] In its factum, counsel for the Plaintiff specifies that her claim for negligent misrepresentation is for $63,750.

[162] On damages to be assessed against Apolo, damages based on negligent misrepresentation overlap with the $80,000 already awarded.

[163] I am prepared to award partial default judgment for $63,750 against Apolo for negligent misrepresentation. This award is not in addition to the $80,000 for breach of contract.

[164] Again, to prove the balance of her damages claimed for misrepresentation stemming from the hiring of Apolo, further evidence is required and the action must proceed in the usual course.

Aggravated and Punitive Damages

[165] Now, under this head of Damages Ms. V is claiming $10,000.

[166] At paragraph 73 of the Statement of Claim the Plaintiff pleaded: Apolo’s and Mr. F’s conduct…sought to undermine the legitimate contractual and financial interests of Ms. V. As a result she suffered a significant amount of mental and emotional distress.

[167] At paragraph 74: Apolo took advantage of Ms. V’s vulnerability and engaged in conduct that was wilful, deliberate, entirely without care, high handed and an intentional disregard of the rights of Ms. V. A punitive damages award is necessary to deter Apolo and Mr. F from acting similarly in the future.

[168] Just because the Plaintiff characterized the conduct as she did does not automatically render it sufficiently egregious to meet the requisite legal test.

[169] Nor does the pleading at paragraph 75: Apolo and Mr. F’s actions warrant a finding they are liable to Ms. V for aggravated and punitive damages in the amount of $50,000, pre-empt the duty of this court “not to mechanically process” this aspect of the claim.

[170] I am not satisfied on the pleading and evidence to date that default judgment should go for punitive and aggravated damages.

Disposition

[171] I award the Plaintiff immediate default partial judgment of $80,000 against Apolo and the same $80,000 as against Apolo and Mr. F jointly and severally for her claim under the CPA.

[172] I award partial default judgment against Apolo for negligence and negligent misrepresentation as set out above (to be subsumed in the $80,000 award already made against Apolo).

[173] As specified earlier, if so advised, the Plaintiff is at liberty to continue this action in the usual course and to seek further damages for, inter alia, contractual delay / lost interest, Negligence and Negligent Misrepresentation and punitive damages in the usual course.

[174] The Defendants are ordered to pay costs of this motion to the Plaintiff fixed at $15,000 inclusive of disbursements and HST. The Plaintiff has undertaken to forward these costs once received to Pro Bono Ontario.

Released: June 25, 2025

M.A. Sanderson