Sharon C. Vogel

In a Commercial List dispute arising from a light rail transit project, the applicants sought declaratory relief alleging that the respondents breached a project agreement by entering into an operator agreement with the transit operator on terms inconsistent with the project agreement.

The respondents moved to stay the application based on release and arbitration provisions in earlier Minutes of Settlement, while the applicants moved for production of an unredacted copy of the operator agreement.

Applying the stay framework from Peace River, the court held the respondents failed to show even an arguable case that the dispute was caught by the settlement arbitration clause, because the alleged actionable wrong did not arise until the operator agreement was executed after the settlement effective date.

The court also ordered production of the complete unredacted agreement, finding it central to the issues and that the respondents had adduced no evidence capable of justifying redactions for confidentiality or commercial sensitivity.

Costs of $90,000 partial indemnity were awarded to the applicants.

The responding parties brought an application seeking declaratory relief regarding the moving parties' alleged failure to retain an operator for a light rail transit project.

The moving parties brought a motion to stay the application in favour of arbitration, relying on a dispute resolution clause in prior Minutes of Settlement.

The court granted the stay, applying the competence-competence principle and finding that the moving parties established an arguable case that the dispute fell within the arbitration agreement.

The court also found no undue delay by the moving parties in seeking the stay.

This is a costs endorsement from the Court of Appeal for Ontario, following an appeal where the lower court's judgment and costs order were set aside and the application remitted for rehearing.

The parties were unable to agree on the disposition of the original application costs.

The Court of Appeal determined that the fairest approach was to leave the issue of the application costs to the trier of fact on the rehearing, whether before a Superior Court judge or in an arbitral process.

Appeal costs had previously been awarded to the appellants.

This is an appeal concerning the interpretation of a complex project agreement for the Eglinton Crosstown LRT in the context of the COVID-19 pandemic.

The application judge had found that a specific contractual provision (s. 62.1(c)) requiring a "Variation Enquiry" was triggered by an internal email from the Crown agencies to their own staff, which was never sent to the consortium.

The Court of Appeal found that the application judge made a palpable and overriding error in concluding that this internal email constituted notification to the consortium.

The appeal was allowed, the original judgment set aside, and the application remitted to the Superior Court for a rehearing to consider other arguments, including good faith and the indivisibility of the Crown, which the application judge had not addressed.

The moving parties sought leave to appeal an order dismissing their motion for a stay of proceedings.

The Divisional Court dismissed the motion for leave to appeal and awarded costs of $10,000 to the responding parties.

The applicants sought $430,000 in costs following a successful application regarding a construction dispute.

The respondents argued that a settlement offer they made should limit the applicants' costs to the period before the offer, and that disbursements for online legal research should not be compensable.

The court found that the respondents' non-monetary settlement offer was more favourable than the judgment obtained by the applicants, as it would have led to a faster final determination of the underlying dispute.

Consequently, the applicants' costs were limited to $92,119.92 incurred before the offer.

The court also disallowed the $4,060.18 claimed for online legal research, finding the applicants failed to prove these costs did not fall within standard office overhead.

The applicants, a consortium of construction companies building the Eglinton Crosstown LRT, sought declarations that the COVID-19 pandemic constituted an Emergency under their Project Agreement, entitling them to a Variation Enquiry for an extension of the Substantial Completion Date.

The respondents moved to stay the application, arguing the contract required all litigation to be deferred until after Substantial Completion.

The court dismissed the motion for a stay, finding it would cause irreparable harm by depriving the applicants of their contractual right to seek an extension.

The court granted the declarations, holding that the pandemic was an Emergency and that the respondents had required the applicants to implement additional or overriding procedures (social distancing), thereby triggering the Variation Enquiry process.

The applicant sought judgment for $7.45 million pursuant to a settlement agreement.

The respondent claimed a right of set-off for insurance deductibles under the construction contract's owner-controlled insurance policies.

The applicant argued that a release executed as part of the settlement extinguished the respondent's right to claim the deductibles.

The court interpreted the release in its factual matrix and concluded it was limited to the five specific disputes settled, and did not terminate the applicant's ongoing obligation to pay deductibles under the continuing contract.

The application was dismissed.

Following the dismissal of the defendant's motion for partial summary judgment, the successful plaintiff sought costs on a partial indemnity scale.

The defendant argued the claimed amount was excessive and objected to the plaintiff's 'team approach' to the litigation.

The court found the division of labour reasonable but applied a discount to reflect the junior lawyers' experience and the fact that some work would apply to trial preparation.

Costs were fixed at $53,231.77 inclusive of fees, disbursements, and HST.

The applicant, Freyssinet Canada Limitée, brought a Rule 21 motion to determine a question of law regarding whether Parkway Infrastructure Constructors (PIC) is precluded from recovering damages claimed in its counterclaim, which are also claimed against Builder's Risk insurers.

Freyssinet argued that a covenant to insure in the Project Agreement, and potentially an implied term in the Subcontract, allocated risk away from it.

The court dismissed the motion, finding that material facts were in dispute, the enforceability and interpretation of the Subcontract were contested, and a full factual record was necessary for proper adjudication.

The court also found no legal bar to PIC's counterclaim, noting that PIC was not acting as an insurer bringing a subrogated claim against its own insured.

Chartis Insurance Company of Canada moved for partial summary judgment to dismiss a claim by Walsh Construction/Bondfield Partnership for payment on a performance bond, arguing the action was statute-barred.

The court found that determining whether the claim was statute-barred required extensive factual findings regarding the subcontractor's actual default, proper notice, and cure of defaults, which constituted genuine issues requiring a trial.

The motion was dismissed due to the complexity of the factual matrix and the risk of inconsistent findings with related construction lien actions involving other parties.

Following a successful motion, the plaintiff sought partial indemnity costs of $17,000.

The defendant argued the amount was excessive and proposed $6,000.

The court found the requested amount fair and reasonable, noting it was almost identical to the partial indemnity costs incurred by the defendant itself.

Costs were fixed at $17,000.

The moving parties sought a stay of five construction lien actions commenced by the construction manager and general contractor, arguing the disputes were subject to contractual arbitration clauses.

The dispute arose from a large construction project involving numerous subcontractors and more than fifty lien claims consolidated into a construction lien reference under the Construction Lien Act.

The court considered whether arbitration should proceed despite the risk of multiplicity of proceedings and the exclusion of subcontractor lien claimants from the arbitral process.

The court held that the moving parties had waived arbitration by first commencing litigation, had delayed unduly before seeking arbitration, and that a stay would cause unfairness and fragmented proceedings.

Exercising discretion under the Arbitration Act, 1991 and the Courts of Justice Act, the court refused the stay so that all disputes could proceed in the single court reference.

The City of Hamilton commenced an action against the architect and general contractor of an arena project for construction defects.

After years of inaction, the action was dismissed for delay by the registrar when the City's counsel inadvertently failed to attend a status hearing.

The City's motion to set aside the dismissal was denied by the motion judge.

On appeal, the Court of Appeal upheld the dismissal, finding that the 15-year delay was inordinately long, the critical five-and-a-half-year period of inaction was unexplained, and the delay caused actual prejudice to the defendants due to the unavailability and faded memories of key witnesses.

The appellants (CNR) insured a custom-built tunnel boring machine under an 'all risks' policy that excluded the cost of making good 'faulty or improper design'.

During construction, the machine failed due to excess differential deflection, allowing dirt to penetrate the main bearing and causing significant delay and repair costs.

The insurers denied coverage based on the design exclusion.

The Supreme Court of Canada held that the exclusion did not apply because the design was state-of-the-art and accommodated all foreseeable risks at the time it was finalized.

The Court concluded that a design is not 'faulty or improper' simply because it fails to withstand all foreseeable risks, provided it meets the highest engineering standards of the day.

The insurers, having been successful on appeal, sought costs for both the appeal and the lengthy trial.

The Court of Appeal awarded the insurers their costs of the proceedings on a partial indemnity scale, fixed at $135,000.

The court also awarded the insurers their costs of the trial on a partial indemnity scale, fixed at $510,000, noting that the trial involved complex factual and legal issues and that the claimed fees were reduced to reflect an appropriate partial indemnity recovery rate of approximately 65%.

The plaintiffs (CN companies) retained a manufacturer to build a custom tunnel boring machine (TBM) for a railway tunnel project.

The TBM broke down due to excess differential deflection, causing significant project delays.

The plaintiffs sought coverage under a builders risk insurance policy issued by the defendants.

The insurers denied coverage based on exclusions for faulty or improper design and inherent vice.

The trial judge found in favour of the plaintiffs, holding that the excess differential deflection was not foreseeable and thus the faulty design exclusion did not apply.

On appeal, the Court of Appeal allowed the appeal, finding that the trial judge erred in his foreseeability analysis.

The Court held that the risk of differential deflection was known and investigated by the designer, making it a foreseeable risk that the design failed to accommodate.

Consequently, the faulty or improper design exclusion applied, and the action against the insurers was dismissed.

The respondent investment dealer entered into a fidelity insurance contract with the appellant.

After discovering employee fraud, the respondent filed a proof of loss.

The appellant rescinded the bond, alleging misrepresentation in the application, and later brought a motion for summary judgment arguing the respondent failed to commence legal proceedings within the 24-month contractual limitation period.

The Supreme Court of Canada restored the motions judge's summary judgment in favour of the appellant, holding that there was no genuine issue for trial regarding the discovery of the loss, and that the contractual limitation period survived the appellant's wrongful rescission of the contract.