Indexed as:

Maidstone (Township) v. Loosemore Excavating Inc.

Between

Corporation of the Township of Maidstone

(plaintiff (appellant)), and

Loosemore Excavating Inc., Henry Regts and Thames Valley

Engineering Inc. (defendants (respondents)), and

Simcoe & Erie General Insurance Company (third party

(respondent))

[1998] O.J. No. 5046

84 A.C.W.S. (3d) 257

Docket No. C25833

 Ontario Court of Appeal

 Toronto, Ontario

Krever, Labrosse and Doherty JJ.A.

Heard: November 25, 1998.

 Judgment: December 2, 1998.

(4 pp.)

Building contracts -- Liability of builder -- Damages, measure of -- Defences -- Reliance on expertise of others.

Appeal by the plaintiff Township and cross-appeal by the defendant contractor from an award of damages under a construction contract. The plaintiff was awarded judgment in the amount of $61,793. There was an additional claim for $8,560 which was disallowed. The trial judge found that the contractor's work was below standard but also found that the Township had failed to show that it used the most reasonable means to correct the deficiency. There was a further claim for $1,926 which was not referred to by the trial judge. The contractor's cross-appeal contended that as the engineer approved the work, in the absence of a finding of negligence by the engineer, there could be no finding that the contractor's work failed to meet the contractual standard.

HELD: Appeal allowed in part and cross-appeal dismissed. There was ample evidence to show that parts of the contractor's work fell below the contractual standard, and such a finding did not require a finding of negligence on the part of the engineer. Therefore, the cross-appeal was dismissed. The Township was entitled to its claim for $8,560 because it met the required onus of showing that the steps taken were an appropriate response to the problem created by the deficiency. The claim for $1,926 was also allowed as the judge's failure to allow it was clearly an oversight. There was no basis on which to interfere with any other findings.

Counsel:

Richard A. Dinham and Brian McAllister, for the appellant.

Raymond G. Colautti and Craig M. Houle, for the respondent Regts and Thames Valley Engineering Inc.

James A. LeBer, for the respondent, Loosemore Excavating Inc.

The following judgment was delivered by

1     THE COURT (endorsement):-- This is an appeal and cross-appeal from the judgment granting the Township of Maidstone judgment against the contractor Loosemore Excavating Inc. in the amount of $61,793.54 plus interest and granting the contractor judgment on its counterclaim against the Township in the amount of $4,484.44. The action arises from the design and construction of a drain and pumping station and related work.

2     The Township's claim against the contractor and the contractor's counterclaim both required an assessment of competing opinion evidence as to the quality of the contractor's work and the steps needed to correct deficiencies in that work. That evidence was directed to numerous aspects of the work done and was both detailed and technical. The trial judge made a careful item-by-item assessment of the claims and the competing evidence. Apart from two relatively minor matters, we see no basis upon which we can interfere with his findings. Those two matters are:

- Item 20 - concrete under the CNR bridge ($8,560.00): The trial judge found that the contractor's work was below the standard required under the contract. He disallowed this claim on the basis that the Township had failed to show that it had used the "most reasonable" means available to correct the deficiency in the work. In our view, the Township was not required to meet that onus, but was only required to show that the steps taken were an appropriate response to the problem created by the deficiency. The Township met that standard.

- Drain excavation on County Road 46 ($1,926.00): This claim was not referred to by the trial judge in his reasons. His failure to allow this claim was clearly an oversight in that he did allow an identical claim relating to drain excavation on another county road.

3     We would vary the award made in favour of the Township against the contractor by adding $10,486.00 ($8,560.00 plus $1,926.00). We would not otherwise disturb the amounts awarded on the claim or the counterclaim.

4     In its cross-appeal on the counterclaim, the contractor also contended that as the engineer approved its work, there could be no finding that its work failed to meet the standard set out in the contract absent a finding that the engineer was negligent. Not only was there no such finding, the trial judge found that the engineer was not negligent.

5     It does not follow that a failure to prove that the engineer fell below the applicable standard in approving work done by the contractor necessitates a finding that the work done was in accordance with the standards set in the contract. These are two distinct issues. There was ample evidence that parts of the contractor's work fell below the standard required by the contract. Indeed, the real question at trial was not whether any of the work fell below that standard but rather, how much of the work failed to meet that standard.

6     There was also a claim by the Township and a cross-claim by the contractor against the project engineer. Both were dismissed and the engineer was awarded costs as against the Township, which costs were added to the costs awarded to the Township against the contractor. The Township appeals from the trial judge's finding that it had not shown that the engineer was negligent.

7     The allegation that the engineer was negligent was fully canvassed by the trial judge who properly concluded that there was no expert evidence as to the applicable standard of care and no evidence that the standard was not met by the engineer. In the absence of such evidence, we can find no error in the trial judge's conclusion that the Township failed to prove that the engineer was negligent.

8     Finally, we see no error in the trial judge's disposition of the costs. In particular, we are not satisfied that he erred in the exercise of his discretion in refusing to grant the engineer solicitor and client costs.

9     Save for the relatively minor variation in the amount awarded to the Township on its claim against the contractor, we would dismiss the appeal and the cross appeals. The successful parties on each of the appeals are entitled to their costs of that appeal.

KREVER J.A.

 DOHERTY J.A.

 LABROSSE J.A.

cp/d/mii/DRS