In Krieser v. Seligman, 2024 ONCA 827, the case revolved around the construction of a luxury home in Forest Hill, Toronto, and a subsequent legal battle involving allegations of contract breaches, construction deficiencies, and claims of fiduciary duty. In 2004, the plaintiffs contracted the defendant to build their home. While construction progressed, disputes emerged, leading the plaintiffs to withhold payments. Litigation ensued in 2007, with both parties asserting significant claims: the plaintiffs sought damages for alleged deficiencies, while defendant pursued payment for outstanding invoices. The case culminated in a trial in 2022-2023, where the trial court largely ruled against the plaintiffs. The appeal focused on two primary issues: the alleged breach of contract and a claim for breach of fiduciary duty. The plaintiffs argued that the trial judge erred in finding their delayed payments constituted a breach that disentitled them from warranty claims. Additionally, they contended the judge failed to … Read More
Entire Agreement Clause Not A Shield To Fraudulent Misrepresentation
In the recent Court of Appeal ruling of 10443204 Canada Inc. v. 2701835 Ontario Inc., 2022 ONCA 745, the Court of Appeal clarified that entire agreement clauses in contracts do not shield any representor or deprive any party to a contract from remedies available for a fraudulent misrepresentation. Background In May of 2019 the appellant Chirag Patel and his corporation 2701835 Ontario Inc. (the appellants) entered into a purchase agreement (the “APS”) with the respondent 10443204 Canada Inc. (the respondent), related to the purchase of a coin laundry business located in Brampton. The APS contained an entire agreement clause of which the relevant part indicated: “There is no representation, warranty, collateral agreement or condition, affecting this Agreement other than as expressed herein.” In accordance with amended terms to the APS concerning the purchase price the appellants made a partial payment of $100,000 on closing and the balance of the purchase … Read More
Rescission May Be Available Even If Innocent Third Parties Adversely Affected
In the recent Court of Appeal decision of Urban Mechanical Contracting Ltd. v. Zurich Insurance Company Ltd., 2022 ONCA 589, the Court of Appeal considered whether rescission is ever available as a matter of law when the rights of innocent third parties intervene and restitutio in integrum (putting the parties back to their original position) is impossible. The court answered in the affirmative. In the case the appellants brought two applications seeking a determination of whether, as a matter of law, a bond issuer can rescind a bond agreement on the basis of fraudulent misrepresentations and collusion when doing so would affect the rights of innocent parties. Background The case dealt with a public-private redevelopment project with infrastructure Ontario to build a new 17-storey patient care tower (the Project). The construction was to be financed and carried out by the private sector. The Project was subject to Ontario’s procurement process … Read More
When Construction Contracts Go Awry: Ontario’s New Construction Contract Adjudication Regime
Construction contracts come with expectations and potential risks to property owners and contractors. Property owners can face issues related to quality of workmanship, delays, and incomplete or abandoned work. Contractors (including sub-contractors) can deal with a myriad of problems which delay or hinder payment, including issues with other sub-trades, the general contractor, or the owner. Whether you are a property owner undertaking construction or renovations, or a contractor (or sub contract) who has been engaged on a project, if things don’t go as planned it’s important to know what your options for recourse may be. A newly established cost-effective adjudication regime has become an important option to consider. Want to learn more about how to protect yourself from a home renovation disaster? Check out our blog. With the Ontario Legislature’s ratification of the new Construction Act, prompt payment and adjudication came into effect on October 1, 2019. The new legislation … Read More
Construction Arbitrator | Reasonable Hourly Rate | Good Availability
Construction arbitrators must be able to arbitrate efficiently and at the pace required by the parties, disputes ranging from simple renovations and repair, to complex multi-party multi-staged projects. The ability to understand construction stages and complexities of design, architecture, engineering and project management, and technical dimensions of a construction dispute are the hallmarks of an effective construction arbitrator. Sole Arbitrator – $450.00 per hour, plus HST Experience In his practice here in Ontario, and when practicing in Dubai and Bermuda, David has been involved in a wide array of construction disputes, including, but not limited to project development, project finance, infrastructure and construction disputes, including matters involving parking garages, road building, residential house construction and renovation, condo development and financing disputes, numerous joint venture disputes, matters involving demolition, collapse, fire and flood, as well as contract disputes concerning construction quality and warranties; and labour disputes in the construction industry. Arbitrator … Read More
Construction Law Lawyers – An Overview of Construction Law
Construction law and practice, largely governed by the Construction Act, R.S.O. 1990, c. C.30 (the “Act”), is a specialized field of law which has unique attributes, processes and deadlines. One cannot contract out of the application of the Act and must abide by its provisions. Without going into the various intricacies, the following is a brief primer on some (not all) key parts of the Act for those that may need legal assistance with a construction related dispute. The Initial Contract A construction project will typically start with a contract between a property owner and a general contractor. For a fee, the contractor takes on the responsibility of overseeing the project and supplying services and/or materials to the construction project. The Subcontracts The contractor often needs help from tradespeople (“subcontractors” or “subtrades”) with various aspects of the project like plumbing, painting, etc. For such assistance, the contractor tends to enlist … Read More
COVID-19 / Coronavirus: Urgent Hearings in Small Claims Court
Since March 16, 2020, all hearings in the Ontario Small Claims Court have been suspended due to the COVID-19 pandemic. Although the Superior Court of Justice has had procedures in place to bring an urgent civil or commercial list hearing since March 15, 2020, the Small Claims Court was left without the ability to hear urgent motions and garnishment hearings until today. Today, the Chief Justice of the Superior Court of Justice released the updated Notice Regarding the Suspension of Small Claims Court Operations to outline the procedure to request an urgent hearing in Small Claims Court and to provide guidance on the type of matters a judge may find to be urgent. Urgent hearings may include: Cases in which a judgment debtor has an outstanding warrant for arrest issued in relation to a Small Claims Court proceeding; or Time-sensitive cases that would result in immediate and serious financial hardship … Read More
Toronto Lawyers for COVID-19 / Coronavirus Urgent Legal Services
See our information and resources regarding legal services during COVID-19 through these links to the Gilbertson Davis LLP website: Arbitration During the Pandemic Remote Arbitration Hearings – Emerging Protocols Arbitration & Court Closure Contract Arbitrator Event Cancellation Arbitrator Contract Termination Arbitrator Moving Litigation to Arbitration | Arbitration Options Business and COVID-19 Ontario Allows More Businesses To Reopen Soon Ontario to Permit Some Businesses to Reopen on May 4 Small Business Relief Resources Ontario Extends Mandatory Closure of Non-Essential Businesses Ontario-Canada Emergency Commercial Rent Assistance Program Construction and COVID-19 Are Closing Dates Extended Due to Construction Sites Closing? Urgent Hearings for Real Estate Closings Contracts and COVID-19 Pandemic Closures: Considerations For Commercial Tenants And Landlords How to Schedule an Urgent Civil or Commercial List Hearing Comments on Frustration and Force Majeure Clauses in The Huffington Post Legal Consequences on Commercial Contracts Distribution Agreements Manufacturing Contracts Shopping Mall Lease Deferral Contract Disputes … Read More
Ontario Courts Suspend Civil Jury Trials Due to COVID-19 / Coronavirus
On April 20, 2020, the Chief Justice of the Ontario Superior Court of Justice issued a Notice to the Profession, Public, Accused Persons and the Media Regarding the Suspension of Criminal and Civil Jury Trials to advise that criminal and civil jury trials will be suspended until September, 2020, at the earliest. Since March 17, 2020, the Ontario Superior Court of Justice has suspended all regular operations, including adjourning all civil matters except: (a) civil motions and applications deemed to be urgent and time-sensitive by the court; (b) outstanding warrants issued in relation to a Small Claims Court or Superior Court civil proceeding; and (c) the following expanded civil matters, subject to each region’s notice and effective April 6, 2020: (i) pre-trial conferences that were cancelled between March 16 and May 31, 2020, and to be held for the purpose of settlement; (ii) Rule 7 motions or applications for approval … Read More
COVID-19 / Coronavirus: Are Closing Dates Extended Due to Construction Sites Closing?
On April 3, 2020, the Ontario government ordered that further non-essential businesses must close by April 4, 2020 at 11:59 p.m. including closing down most construction sites in order to flatten the curve of the COVID-19 pandemic. The number of essential businesses was reduced from 74 to 44. The revised list of essential businesses can be found here. Construction sites related to the healthcare sector, provincial infrastructure such as transit, and projects related to the production of ventilators and other products directly related to fighting COVID-19 were permitted to remain open. Residential construction sites were permitted to remain open where: (i) a footing permit has been granted for single family, semi-detached and townhouses; (ii) an above grade structural permit has been granted for condominiums; or (iii) the work was related to renovations and started before April 4, 2020. Given the expansive definition of essential residential construction sites, it appears that … Read More
Prompt Payment Regime Takes Effect For Construction Projects
A major shift has been underway in Ontario since the legislature ushered in reforms under Bill 142, the Construction Lien Amendment Act, 2017, S.O. 2017, c. 24., perhaps none of which is more significant than the prompt payment regime which took effect on October 1, 2019. Changes To Lien Period: Effective July 1, 2018 Changes to the previous legislation (The Construction Lien Act) have come into effect in phases, with the first set of changes having taken effect in July of last year. We are now in the midst of transition rules which apply depending on the commencement date of a construction project to determine the applicable lien period which changed from 45 days to 60 days for prime construction contracts entered into after July 1, 2018. There were several additional notable changes which took effect as of July 1, 2018, including the extension of the period to perfect a … Read More
Entire Agreement Clause Upheld in Manorgate Estates Inc. v. Kirkor Architects and Planners
Entire Agreement Clauses are meant to prevent negotiations that occurred prior to the contract being formed from influencing the Court’s interpretation of the terms set out in the final contract. In other words, past discussions are to have no bearing on the understanding of the contractual terms. In theory, a fully integrated agreement of this kind supplants any earlier oral or written agreements. There is competing jurisprudence in which Entire Agreement Clauses have been both effective and ineffective. However, Manograte Estates Inc. v. Kirkor Architects and Planners is a recent Ontario Court of Appeal decision where an Entire Agreement Clause was effective. In Manograte Estates Inc. v. Kirkor Architects and Planners, the Ontario Court of Appeal upheld the Motion Judge’s decision that the Entire Agreement Clause in the relevant agreement, regarding architectural consulting for a construction project, operated as a complete defence to the appellants’ claim of alleged negligent misrepresentation. The Entire Agreement Clause … Read More
Grounds for Judicial Intervention on International Arbitral Awards – Key Takeaways
In Consolidated Contractors Group S.A.L. (Offshore) v. Ambatovy Minerals S.A., a decision of the Court of Appeal for Ontario, a USD$258 million project for the construction of a slurry pipeline from a nickel mine in the mountains of Madagascar to the coast lead to arbitration between the appellant (the contractor) and the respondent (tendered the project). After mutually agreeing to by-pass the adjudication stage of their three-stage dispute resolution process and go straight to a Tribunal, the appellant was only awarded $7M of its $91M claim and the respondent was awarded nearly $25M on its counterclaim. These awards were challenged on appeal as being made without jurisdiction, in breach of procedural fairness, and violating public policy. However, the appeal was dismissed. Judicial intervention in international arbitral awards under the United Nations Commission on International Trade Law (UNCITRAL) Model Law (the “Model Law”) – though given the force of law by the International Commercial Arbitration Act … Read More
Lost in Cyberspace : Legal causation in the age of AI and driverless cars
One day, in the immediate future, you might very well witness this scene from your office window. A lawyer jaywalks across a Toronto street to avoid being late for a firm risk management committee meeting. While she does so, she texts her colleague in Calgary with instructions on containing the legal liabilities arising from a northern Alberta oil plant shut-down that has already occurred in the future (a reality of simultaneity across locally-logged events across a multi-timezone world) after an eco-terrorist hacked into the plant heating system. It is at this moment that she is struck by an autonomous delivery van. The van was travelling the wrong way down a one-way street because the city transportation department had not uploaded a temporary change to traffic direction to accommodate a condo developer. An algorithm built into the telephone service to warn the lawyer of oncoming traffic fails to alert her because the … Read More
Under Construction: Major Reforms Coming To Construction Lien Act
The Ontario government has tabled Bill 142, which if passed will result in fundamental changes to the Construction Lien Act (the Act) and will have a significant impact on payment and dispute resolution practices within the construction industry. The most significant of the proposed amendments to the Act is the introduction of a mandatory prompt payment regime. Prompt payment regimes have been in place for decades in some other jurisdictions including the U.K., and there have long since been calls for Canada and Ontario to adopt a similar model. The impetus in adopting a prompt payment regime within this unique sector is to curb the systemic plague of gridlock on construction projects which arise due to payment disputes and lack of payment which lead to project disruptions – a chronic industry phenomenon. The regime will also serve to protect the most vulnerable segments of the sector such as subcontractors, who can … Read More
Construction Heavy Machinery & Equipment Disputes
We have experience and can act in matters relating to construction heavy machinery and equipment. Disputes often arise in connection with the purchase and sale, leasing, financing, use or operation of construction heavy machinery. Sometimes disputes arise in relation to ownership or possession of construction heavy equipment. We set out below some of the common types of disputes arising in relation to construction heavy equipment. Types of Disputes Common disputes include those related to: purchase and sale, pre-sale representations, warranties, damaged equipment, sale by auction, shipping heavy machinery and equipment, damages, loss and collapse, hire-purchase disputes, ownership and possession, and repossession by court order. Types of Construction Equipment A vast array of construction equipment is deployed in modern construction projects. Some construction companies lease and others purchase. Some have only occasional need for some construction heavy equipment. Typical construction heavy equipment and machinery includes: Backhoe loaders, breakers, bulldozers, chippers, compactors, concrete plants and pumps, conveyors, … Read More