Canada: MT November 2017 Case summaries

Last Updated: November 21 2017
Article by Jonathan Martin

1. Repudiation of contracts through non-performance:
Limen Forming West Ltd. v Stuart Olson Dominion Construction Ltd, 2017 BCSC 1485

The defendant, Stuart Olson Dominion Construction Ltd (Stuart Olson), was the general contractor for the construction of a residential rental building, and plaintiff, Limen Forming West Ltd. (Limen), was awarded a subcontract for concrete formwork. The formal contract was not signed for formwork because of a dispute over whether Limen had to provide contract security. The parties negotiated terms of agreement and Limen began the work. Because of the ongoing disagreement over contract security, Stuart Olson made no progress payments. After completing approximately 30% of the work, Limen sent a demand for payment letter and, when agreement could not be reached, instructed its crew not to return to the worksite. Stuart Olson issued a notice of contract termination, taking the position that Limen had repudiated the contract. Limen sued for work performed plus loss of profits and overhead, and materials left on site. Stuart Olson counterclaimed for net damages of $181,669.15, after subtracting the value of Limen's work.

The action was allowed in part. The Court found that repudiation does not arise where stoppage was used to exert pressure on the payor to make progress payments in accordance with its contractual obligations. Anticipatory breach was not made out since Limen was in a position to carry out the work and did not remove its crew until the contract was terminated by Stuart Olson. Through its unreasonable position and notice of termination, it was in fact Stuart Olson which had repudiated the contract and Limen was entitled to work performed plus damages for breach of contract. The Court ordered damages for work performed in the amount of $934,930.50, inclusive of taxes and holdback, and for lost profits in the amount of $104,032, plus GST. The claims for overhead and materials left on site were dismissed.

Takeaway: Parties to a construction contract should beware in claiming repudiation by the opposing party prematurely lest their conduct be found to constitute repudiation.

2. Enforceability of construction contracts which are in violation of municipal zoning bylaws:
Nzeadibe v Khan, 2017 BCSC 1456

The defendant fraudulently represented to the plaintiff that if he purchased a certain lot, he could build a house on that lot that would measure 3,638 square feet and would incorporate a self-contained suite. The plaintiff purchased the lot relying on those representations. The city of Surrey zoning by-law permitted only residences up to 2,837 square feet and precluded secondary suites. The house that was actually built measured around 2,700 square feet and had no secondary suite. The plaintiff sued for breach of contract and fraudulent misrepresentation. Damages were awarded for fraudulent misrepresentation but damages for breach of contract were denied on the basis that the contract did not contain the promise to build the larger house. The Court also found that such a contract would be unenforceable due to statutory illegality because it violated the zoning bylaw. The Court distinguished this situation from cases where the illegal structure had in fact been built and the owner was seeking to avoid payment to the builder on the basis of illegality while at the same time retaining the benefit of the illegal structure. In this case, public policy was entirely against an individual seeking to claim damages solely for the loss of the profits he would have gained through the illegality.

Takeaway: The doctrine of illegality can be effectively used to defend an action for damages if the party relying on this defense has not itself benefited from the illegality.

3. Enforceability of liens containing incorrect information:
Norson Construction Ltd. v Clear Skies Heating & Air Conditioning, 2017 ABQB 544

A subcontractor hired Clear Skies Heating & Air Conditioning (Clear Skies) to install HVAC systems on the owner's project. Clear Skies filed a builders' lien for $131,798.10 against land, but mistakenly indicated that the subcontractor was the owner. The owner advised the general contractor, Norson Construction Ltd. (Norson), that  it would cease progress payments until the lien was removed. Norson applied to have the lien removed. The Court found that the recording of the wrong entity as owner on the lien did not vitiate the lien since no one was prejudiced by the error and the lien was in substantial compliance with s. 34 of the Builders' Lien Act. Norson appealed to a judge of the Court of Queen's Bench. The appeal was dismissed. The Court of Queen's Bench found that the lower court correctly stated the issue of prejudice in terms of whether anyone was misled by failure to register against the correct interest holder. The parties admitted that no prejudice resulted from the failure to file a lien against the correct owner as the correct property interest was identified in the statement of lien and was filed against the legal title to the property, ensuring that the owner would get notice. This case was distinguishable from one where both the property interest and the owner were incorrectly identified since in those cases there was a substantial risk that the owner of the liened interest would be misled.

Takeaway: Liens which incorrectly identify the property owner can still be enforced if they correctly identify the property against which the lien is asserted and the owner is not prejudiced.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Jonathan Martin
In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions