Homexx Corp. v. Nelson, 2013 ABQB 513

Court of Queen ’ s Bench of Alberta Citation: Homexx Corp. v. Nelson, 2013 ABQB 513 Date: 20130911 Docket: 1103 13589; 1203 07176 Registry: Edmonton Between: Homexx Corp. Plaintiff - and - Rodney Nelson & Judy Nelson Defendants And Between: 1203 07176 Rodney Nelson & Judy Nelson Plaintiffs - and – Homexx Corp. Defendant _ ________________________________________ ______________

_ ________________________________________ ______________ Arbitration Appeal Memorandum of Decision of the Honourable Madam Justice A.B. Moen _________________________________________ ______________ Table of Contents I. Introduction . 3 II.

Summary of Conclusions . 4 III. Discussion . 4 A. What is the standard of review? . 5 1. On the issues raised by the Nelsons . 5 2. Duty to be fair 6 3. Jurisdiction . 6 B. The Arbitrator’s Decisions . 7 July 26, 2011 Award . 7 April 10, 2012 . 8 C. The Legislation . 9 D. Do the parties raise questions of law? . 9 1. Do the Nelsons Raise Questions of Law? . 10 a. Delay . 10 b. Relevant evidence . 10 c. Missed issue . 11 d. Damage principles in contract law .. 12 2. Does Homexx Raise a Question of Law? . 12 E. Were there errors of law made by the Arbitrator? . 13 1. Conclusion . 14 2.

Other issues if in error on whether they constitute questions of law .. 14 IV. Conclusion . 14 I. Introduction [ 1 ] The Nelsons built a home in Fort Saskatchewan under a contract with a builder, Homexx Corporation (Homexx). The Purchase Agreement was a standard contract for the purchase and sale of land and buildings. The details were set out in schedules to the

contract. [ 2 ] The Nelsons claim that the house was not built according to the agreed upon specifications. In particular, they complained that the house was built too low for the drainage in the area and the driveway had insufficient slope to meet the grading standards. They say that the contract provided for a slope on the driveway and a plot elevation for the house, neither of which were achieved when the home was built.

They claim that the poor grade caused pooling, icing and other problems with their new home and driveway. [ 3 ] The initial stage of the dispute was referred to Conciliation under the Alberta New Home Warranty Program, and the Conciliation Report concluded that none of the homeowners’ concerns were the result of defects in workmanship or materials and required no action by Homexx. In regards to the grading of the driveway, the Conciliation Report concluded that any discrepancy in the driveway grade with the City’s requirements were a matter of contract, not workmanship or materials.

The Conciliation Report did not find any drainage problems and concluded that the driveway had a positive slope, as required. [ 4 ] The Nelsons then sought arbitration, filing a Notice to Arbitrate. The arbitration hearing occurred in December 2010. [ 5 ] The Arbitrator rendered an Interim Award in July 2011. On request of both parties, the Arbitrator reconsidered a number of points and rendered another Interim Award in April 2012. [ 6 ] Neither party agrees with the decision of Arbitrator.

They both appeal that decision for different reasons. [ 7 ] The Nelsons appeal the arbitration decision. [ 8 ] The Arbitrator found that Homexx breached the purchase contract, but she awarded a different remedy than the one they sought. They wanted the house raised and sought over $300,000 to do so; the arbitrator concluded that this was an extreme remedy in the circumstances and that an appropriate remedy would be to have the driveway slope corrected or have a reverse driveway installed.

She further considered that damages might be warranted if these corrections decreased the re-sale value of the home, and awarded damages for that difference. [ 9 ] Homexx also appeals arguing that the Arbitrator erred in rejecting the Developer’s approval of the Nelson’s lot grading and that she awarded a remedy, repairing the driveway grade, that she had no jurisdiction over since the approach to the driveway is not owned by the Nelsons, but by the City. [ 10 ] This appeal raises the following questions: 1. What is the standard of review? 2. Do the appeals raise questions of law 3.

Were there errors of law made by the Arbitrator? 4. Was there a breach of natural justice caused by the delay of the Arbitrator in giving reasons? 5. If an error of law or a breach of natural justice, what is the remedy? II.

Summary of Conclusions [ 11 ] In my view, with the exception of the question of delay, the Nelsons have not raised a question of law. The alleged errors of law include the failure to consider relevant evidence, breach of the “missed issue “rule, misapplication of damages principles in contract law, and findings made in the absence of evidence. Upon review, these alleged errors are errors of fact or mixed fact and law, and thus not subject to appeal. Even if they raise questions of law, the standard of review is reasonableness, as none of the alleged errors are questions of general law of central importance to the legal system as a whole, and the Arbitrator’s decision was reasonable.

[ 12 ] The Nelsons also allege a breach of natural justice by delay, however, s 15(1) of the Arbitration Act provides a remedy for delay. The parties could have applied to the Court for relief for undue delay. It would not be appropriate to permit the parties to wait to complain about delay until the decision is released and then complain of delay if they do not like the decision. This raises the concern that this application was premature. The Arbitrator’s awards were both titled “Interim Award”; the Arbitrator continued to have jurisdiction to resolve issues related to implementation and costs.

Further, the Nelsons have never sought a variance from the City. [ 13 ] Homexx argues that the arbitrator made an error of law in awarding a remedy that requires property not owned by the Nelsons be remedied, alleging that this was an error of jurisdiction. Homexx addressed two letters to the arbitrator, asking her to deal with this question, and no response has been forthcoming. This appears to be a question of mixed law and fact.

Moreover, it is apparent that the Arbitrator considered this difficulty, raised in submissions by Homexx before the second Interim Decision, as she alternatively awarded the costs of installing a reverse driveway if replacing the existing driveway at the appropriate slope was not possible. III. Discussion [ 14 ] The arbitration was conducted under the Alberta New Home Warranty Program (the Warranty Program) and the Arbitration Act , RSA 2000, c. A-43.

The Arbitration Act provides that, unless the parties agree in the contract to the right to appeal on questions of law, fact, and mixed fact and law, an appeal may only be brought on a question of law with leave, subject to conditions. In the Agreement to Arbitrate, the parties agreed to an appeal on a question of law, therefore leave is not required but the parties may only appeal a question of law. A. What is the standard of review? 1. On the issues raised by the Nelsons [ 15 ] The Nelsons argue the following issues are questions of law: a. Breach of natural justice – delay; b.

Failure to consider relevant evidence; c. “missed issue” or failure to consider relevant evidence (root cause of the dispute); and d. Failure to apply correct principles of damages in contract and making findings in the absence of evidence (reverse driveway). [ 16 ] The parties assert that the standard of review on questions of law before an arbitrator is correctness.

However, the Supreme Court of Canada in recent decisions has made the standard of review reasonableness on almost all questions before the superior court. [ 17 ] Reasonableness was discussed fully by the Supreme Court of Canada in Dunsmuir v New Brunswick , 2008 SCC 9 , [2008] 1 SCR 190 at paras 32 , 34 and 41, where the court decided that there were to be only two standards of review: reasonableness and correctness.

At para 55, the Court noted: A question of law that is of “central importance to the legal system ... and outside the ... specialized area of expertise” of the administrative decision maker will always attract a correctness standard (Toronto (City) v. C.U.P.E., at para. 62). On the other hand, a question of law that does not rise to this level may be compatible with a reasonableness standard … [ 18 ] The questions raised here are not of central importance to the legal system and fall within the specialized expertise of the arbitrator.

The question of whether particular issues or evidence should have been considered is limited to the factual circumstances of this case. Further, the Arbitrator’s decision that raising the house was an extreme remedy in the circumstances was also specific to this dispute. Her decisions were not precedential and were not central to the legal system. [ 19 ] In Nor-Man Regional Health Authority Inc. v.

Manitoba Association of Health Care Professionals , 2011 SCC 59 the Supreme Court considered “whether arbitral awards that apply common law or equitable remedies are for that reason subject to judicial review for correctness” (at para 32). In that case, it was a question of whether the Arbitrator imposed estoppel appropriately.

The Court concluded that the arbitrator was entitled to deference in its application of common law and equitable remedies and set the standard of review as reasonableness. [ 20 ] I conclude that if the questions raised by the Nelsons raise a question of law, it is subject to the reasonableness standard.

[ 21 ] Reasonableness is a deferential standard in which the reviewing court looks into whether the tribunal’s decision “falls within a range of possible, acceptable outcomes which are defensible in respect of the facts and the law” ( Dunsmuir , at para 47 ). [ 22 ] Here we have an arbitration which falls squarely under the Arbitration Act whereby the legislature and the parties, by their contract, decided to give decision making power to an arbitrator and restrict the court’s supervision of those arbitrators.

The Home Warranty Program required disputes between the home owner and the builder be resolved by arbitration. The arbitrator in this case was chosen to arbitrate a construction dispute. There is no information as to the expertise of the specific arbitrator but the recent decisions of the Supreme Court of Canada suggest that we should assume that the arbitrator is acting within that arbitrator’s expertise unless there is some evidence to the contrary.

We do not have any evidence to suggest that the particular arbitrator in this case did not have experience in the area resolving disputes about house construction. [ 23 ] In my review of the arbitrator's decision, I must show deference to the arbitrator bearing in mind that the questions before this arbitrator may not lend themselves to one specific, particular result. There may in fact be a number of possible, reasonable conclusions. Therefore, I must inquire into the qualities that make a decision reasonable both as to the process of articulating the reasons and outcomes.

In considering whether the decision is reasonable, I must be concerned with the existence of justification, transparency and intelligibility within the decision-making process. Does the decision fall within a range of possible, acceptable outcomes which are defensible in respect of the facts and law?: Newfoundland and Labrador Nurses' Union v. Newfoundland and Labrador (Treasury Board) , 2011 SCC 62 , [2011] 3 SCR 708 at para. 11 citing Dunsmuir paragraphs 47 to 48 . 2.

Duty to be fair [ 24 ] The Nelsons also complain that the arbitrator was not fair because the arbitrator took a long time to render both her original decision and her reconsideration decision. The time she took was outside the time agreed by the parties. [ 25 ] The standard of review on a question of the duty to be fair is correctness: Boardwalk Reit LLP v. Edmonton (City) , 2008 ABCA 220 at para 174 ; Grand Central Properties Inc v Cochrane (Town) , 2013 ABCA 69 at para 14 . [ 26 ] However, this complaint may not be an issue of a duty to be fair. If not, the standard of review is reasonableness. 3.

Jurisdiction [ 27 ] Homexx argues that the Arbitrator made a jurisdictional error that should be subject to the correctness standard. The Arbitrator ordered Homexx to correct the driveway grading, including the approach which is on City land. Homexx says that the Arbitrator did not have jurisdiction to order Homexx to do anything on third party’s land, that is, on land owned by the City. [ 28 ] The Supreme Court of Canada in Alberta (Information and Privacy Commissioner) v.

Alberta Teachers' Association , 2011 SCC 61 suggested that there may be no true questions of jurisdiction (at para 34), and that in any event, they will be rare and exceptional. [ 29 ] If the Arbitrator made a jurisdictional error, it would be subject to the correctness standard.

If, however, the alleged error is not jurisdictional, the standard would be reasonableness. [ 30 ] I conclude that the question of whether the Arbitrator could make an order which had the effect of ordering Homexx to repair the approach to the Nelson’s driveway is not a jurisdictional error and therefore, is subject to the reasonableness standard. B. The Arbitrator’s Decisions [ 31 ] The Arbitrator rendered an Interim Award, dated July 26, 2011 and then following requests for clarification rendered an additional Interim Award, dated April 10, 2012 that amended the initial award.

July 26, 2011 Award [ 32 ] The Arbitrator summarized the Nelsons’ claim as breach of contract for building the house at the wrong elevation and for failing to provide a lot grading certificate approved by the City of Fort Saskatchewan. The Nelsons sought a remedy of raising the house 12-16 inches to provide the proper grade to the driveway. The Arbitrator summarized the issue as whether Homexx breached the

Purchase Agreement or its duty of care by: 1. Not meeting the Alberta Building Code by not completing the lot grading to comply with City engineering standards, the approved Drainage Plan, and municipal by-laws; 2. Not taking steps to provide the Nelsons with a lot grading certificate approved by the City; 3.

Not completing the work according to industry standards. [ 33 ] She noted that if there was a breach, the next issue to be addressed would be remedies and damages, and whether there was a fundamental breach of the contract because of the extent of the damages. [ 34 ] She concluded that Homexx breached the Purchase Agreement because it did not meet the grading requirements in the design plot plan and the area drainage plan. She reviewed and identified the Purchase Agreement, the community’s Architectural Controls, the City by-laws, the Building Code, the Development and Building Permit.

She concluded that the interplay of these documents lead to the conclusion that the Purchase Agreement contains a builder commitment about lot grading, and that commitment was breached because the driveway did not meet the elevations required by the area drainage plans, the architectural controls, and the development and building permits.

Further, she held that the Purchase Agreement was breached because although Homexx provided the Nelsons with a final grading certificate approved by the developer, the developer should not have approved the certificate since it did not meet the Development and Building Permit requirements, and thus would not be approved by the City. She noted that Mr. Benoit, city engineer, indicated that a variance could be sought from the City after the completion of the building. She further concluded the garage floor met the Development and Building Permit requirements and industry standards.

As a remedy for the breach of the Purchase Agreement, she directed Homexx to correct the driveway to meet the requirements of the design plot plan and the area drainage plan, by either removing and replacing the existing driveway or installing a reverse driveway. Homexx was further required to obtain a lot grading certificate that showed the grades and elevations met the design plan. April 10, 2012 [ 35 ] The Arbitrator then dealt with the questions raised by the parties in regards to the first Interim Award: 1. Jurisdiction to make findings concerning the Developer; 2.

A request to re-open the hearing to permit new evidence on the developer’s approval of the lot grading certificate, industry standards, and the reverse driveway; 3. A request to reconsider parts of the award to correct errors, amend the award and make an additional award concerning the house’s elevation. [ 36 ] On the elevation of the house, the Arbitrator identified the evidence she relied on in concluding that the elevation of the house was not the real issue, and in particular Mr. Benoit, the City’s engineering director, gave evidence that the City does not consider house elevation when assessing grading.

Further, she relied on the evidence of Mr. Heisler, the Nelsons’ expert, and Mr. Benoit that the only grade concerns were with the driveway, and that there may be more than one way to remedy such a grading issue. She noted that the Notice to Arbitrate specified a “grading issue”, and not a house elevation issue. [ 37 ] In regards to industry standards, she conceded that she did not specifically answer that question, and then added paragraphs to address the question.

She concluded that the industry standards are the same as the contractual requirements which require Homexx to meet or exceed the Alberta Building Code. [ 38 ] In regards to the comments about the Developer, she noted that the Developer was not a party to the arbitration or the Purchase Agreement. Her comments were merely to provide insight into her findings about Homexx, and did not purport to exercise jurisdiction over the developer. [ 39 ] In regards to remedy, she rejected the Nelsons’ assertion that she erred in finding that raising the house was an extreme remedy.

In particular, relying on the evidence before her, she noted that: 1. The real issue was not the elevation of the house, but the grading;

2. Mr. Benoit’s evidence was that there was more than one way to correct the grading issue and thatthe City would consider a variance application if one were made; 3. It was premature to say that the only remedy is to raise the house; and finally 4. The Nelsons’ concerns about the future look of their house were not relevant to the driveway gradingissue. [40] She noted that raising the house would be an extreme remedy because that breach of contract was not a fundamental breachjustifying rescission or such an expensive remedy when other options are available.

She further concluded that Homexx need not do therepairs itself, given the acrimonious relationship between the parties, and ordered Homexx to pay the costs of correcting the driveway tomeet the elevation and grading in the design plot. She ordered the parties to each obtain independent estimates for altering the drivewayand the average of the estimates would be the sum payable to the Nelsons. If a reverse driveway was required, the Arbitrator alsoordered the parties to obtain independent appraisals of the property value to determine the average of any difference in value before andafter the driveway was changed.

C. The Legislation [41] The relevant legislation is attached as an appendix to this decision. The following provisions of the Arbitration Act, RSA2000, c.

A-43 are most relevant: 15(1) The court may remove an arbitrator on a party’s application under section 13(6), or may do so on a party’s application if thearbitrator … delays unduly in conducting the arbitration... 16(1) When an arbitrator’s mandate terminates, a substitute arbitrator shall be appointed, following the procedures that were usedin the appointment of the arbitrator being replaced. 44(1) If the arbitration agreement so provides, a party may appeal an award to the court on a question of law, on a question offact or on a question of mixed law and fact. …

(5) The court may confirm, vary or set aside the award or may remit the award to the arbitral tribunal and give directions aboutthe conduct of the arbitration.

(6) Where the court remits the award to the arbitral tribunal in the case of an appeal on a question of law, it may also remit to thetribunal the court’s opinion on the question of law. D. Do the parties raise questions of law? [42] The Arbitration Act (s. 44(2)) provides that the parties may appeal an award to the Court if the arbitration agreement soprovides. The Application to Arbitrate and the Reply to the Application to Arbitrate included a right to appeal to the court on questions oflaw in accordance with the Arbitration Act.

Therefore, the parties must raise a question of law to have a right of appeal. [43] A question of law is generally described as what is the correct test, while a question of mixed fact and law is the application ofthat test to the facts. In Canada (Director of Investigation and Research, Competition Act) v.

Southam Inc., (SCC),[1997] 1 SCR 748 the Supreme Court of Canada noted at para 35: Briefly stated, questions of law are questions about what the correct legal test is; questions of fact are questions about what actually tookplace between the parties; and questions of mixed law and fact are questions about whether the facts satisfy the legal tests. 1. Do the Nelsons Raise Questions of Law? [44] The Nelsons argue the following issues are questions of law:

a. Breach of natural justice – delay; b. Failure to consider relevant evidence; c. “missed issue” or failure to consider relevant evidence (root cause of the dispute); d. Failure to apply correct principles of damages in contract and making findings in the absence of evidence (reverse driveway). a. Delay The contents of the duty to be fair and the principles of natural justice are context dependent, and a breach of the duty to be fair, ifestablished, will result in the Court setting aside a decision by an administrative tribunal : Baker v.

Canada (Minister of Citizenship andImmigration), (SCC), [1999] 2 SCR 817, at para 21. This raises a question of law. b. Relevant evidence The failure to consider relevant evidence is generally a question of law, but a question of weighing and assessing evidence is not. Asnoted in Southam, a question of law is about identifying the correct legal test. In Southam, at paras 39-41, the Court noted that if thetribunal identifies the correct test as requiring it to consider factors A,B, C, and D, and it only considers A, B, and C, that is an error oflaw.

However, a tribunal is “not required to make an explicit finding on each constituent element, however subordinate, leading to itsfinal conclusion “ : Newfoundland and Labrador Nurses' Union v. Newfoundland and Labrador (Treasury Board), 2011 SCC 62 atpara 16. Not discussing particular points of evidence, in the absence of a legal test that requires its consideration, is not an error of law. [45] The errors alleged by the Nelsons included the Arbitrator not addressing what they identify as the key issue: the house wasbuilt at the wrong elevation based on an uncorrected survey error.

That is a question of fact that the Arbitrator did, in fact, address indetail. For example, at para 31 of her award the Arbitrator noted that the house was raised 13 inches when the foundation was excavated,and at para 38, she noted that the house was built 13 inches higher than the survey. This was a question of fact that was addressed by theArbitrator, not a question of law. The Nelsons allege further errors dealing with the elevation of the house, but each of these werereferred to and considered by the Arbitrator, including consideration of testimony from Mr. Benoit, for the City and Mr.

Heisler, for theNelsons. Her understanding and consideration of this evidence are questions of fact, not law. [46] Further, the Nelsons argue that the Arbitrator erred in law in interpreting the contract by concluding compliance with theCity’s engineering standards was not an implied term of the contract. The Arbitrator concluded that the parties had not intended to adoptthose engineering standards, because if they had, they would have expressly done so in the contract.

She considered the evidence that theEngineering standards were not a condition of the Development Permit and that the City’s website states that the standards are to serve asa guideline, not “rigid standards” to reach that conclusion. [47]

Interpretation of contracts may raise a question of law or a question of mixed fact and law, depending upon the context of theissue raised. See Dow Chemical Canada Inc. v. Shell Chemicals Canada Ltd., 2010 ABCA 126 (at para 11 and 12): A trial judge's determination of the factual matrix surrounding the contract in light of the evidence as a whole (including if appropriateextrinsic evidence) is a matter of fact… Once the exact terms and nature of the contract, and the surrounding facts, have beenestablished, the

interpretation of the words of the contract is a matter of law. [48] The error alleged here by the Nelsons is about the factual matrix of the contract and amount to a finding of fact or, at most,mixed fact and law. The Arbitrator considered all the surrounding documents to interpret what were the express and implied terms of thecontract, including the Purchase Agreement, the community’s Architectural Controls, the City by-laws, the Building Code, theDevelopment and Building Permit; this is akin to determining “which documents, promises, and consideration constitute the contract”per para 11 in Dow Chemical.

The Nelsons have not alleged a specific error in the “interpretation and application of contract principles”per para 12 of Dow Chemical. [49] As well, the Nelsons argue that the Arbitrator erred in law by failing to properly consider Homexx’s failure to meet municipaland industry standards and Homexx’s failure to call expert evidence in response to their evidence. These are clearly questions requiringapplication of the facts and are not questions of law. c.

Missed issue The Nelsons argue that the Arbitrator missed the central issue of the dispute - the root cause of the construction deficiency - theallegation that the house was constructed at the wrong elevation. The Nelsons cite the evidence in support of this argument and note that

this evidence was highlighted by the Arbitrator who summarized the Nelson’s argument on this point. The fact that this argument requires a recitation of evidence (the accuracy of which is challenged by Homexx in its brief) demonstrates that this is a question of mixed fact and law. Further, how can it be said that the Arbitrator missed the issue when she expressly summarized the Nelson’s argument on the point?

She considered the evidence about the elevation of the house and rejected the Nelsons’ submissions on the point. [ 50 ] The Nelsons also argue the Arbitrator did not specifically address the issue of non-compliance with industry standards, and complain she did not find that the industry standards required a 2% slope on the driveway. The Arbitrator, however, addressed the Nelson’s concerns and particularly points out in para 17 that the driveway was to be constructed to standard industry practice.

Further, she considered the impact on the existing grade, which is less than 2%, on drainage into the garage and the home. She finds from the evidence of the experts that the landscaped areas of the lot drained away from the house and garage to the side swells to the back of the lot to the drainage pond as they were intended to do [para 20]. In other words, she considered the practical implications of the grade being less than 2%. [ 51 ] These are questions of fact, not law. d.

Damage principles in contract law The Nelsons argued that having found Homexx to be in breach of the contract, the Arbitrator was required to order Homexx to “pay the cost of completing the contract or putting the defect right.”: Harvin D Pitch and Ronald M Snyder, Damages for Breach of Contract, 2nd ed. (looseleaf) (Toronto: Carswell, 1989) at 2-5.

The Nelsons argued that to do so, the Arbitrator should have awarded the cost to elevate the house, and cited the evidence that supports their position, including the expert opinion that the only way to achieve the repair would be to lift the house, evidence from a contractor that could do such a job and its costs, alternate repair possibilities raised by Homexx, and the factual problems in implementing the Arbitrator’s remedy. These are all questions of fact.

The Arbitrator was aware of the proposed remedy by the Nelsons and rejected it, based on the evidence before her. [ 52 ] Thus, I conclude that the only question of law raised by the Nelsons’ appeal is the issue of delay and whether the delay breaches the principles of natural justice and the duty to be fair. 2. Does Homexx Raise a Question of Law? [ 53 ] Homexx also appeals, and argues that the Arbitrator made an error of law by requiring it to correct the driveway grade.

It asserts that it received final grading approval from the developer, and the arbitrator had no jurisdiction to assert that the developer erred in granting that approval. It further challenges the Arbitrator’s choice of remedy on the basis that it is impossible because it requires Homexx to alter the Approach, on property owned by the City. [ 54 ] Jurisdiction to make an order is a question of law, but I note that the Arbitrator did not purport to exercise jurisdiction over the developer.

She only found, as a matter of fact, that the developer approved the grading in the face of the evidence that it did not meet the required specifications. That was a finding of fact she was entitled to make and not a question of law. [ 55 ] As to whether the remedy is possible or not, that is also a question of fact, not a question of law. She did not attempt to exercise jurisdiction over City property and did not require steps be taken to correct the slope of the City-owned access.

Rather she ordered that the driveway be replaced to meet the slope requirements, and, taking into account Homexx’s submissions that the road may make fixing the slope of the driveway impossible, she alternatively provided that Homexx pay the costs of installing a reverse driveway. [ 56 ] I conclude that Homexx has not raised a question of law. E.

Were there errors of law made by the Arbitrator? [ 57 ] As I found above there is only one potential error of law and this is a breach of duty to be fair. [ 58 ] The contents of the duty to be fair and the principles of natural justice are context dependent, as noted previously. Delay may give rise to a breach of the duty to be fair, but not necessarily. See: Flock v. Flock , 2007 ABQB 307 and Metcalfe v. Metcalfe , 2006 ABQB 798 .

In Metcalfe , Nation J declined to set aside the award because the applicant had not objected to the delay until after the award, and had only asked their counsel to inquire as to when a decision might be expected. Similarly, the parties here had written the Arbitrator following a 5 ½ month delay after the first hearing and had written again six months after the second hearing to inquire when a decision might be forthcoming, but they did not complain or take steps under s. 15 of the Act. As in Metcalf e, they did not complain until after a decision was reached.

[ 59 ] I conclude that it would be inappropriate to allow the Nelsons to wait until they saw the award and then object to the timing because they were not happy with the decision. They have not identified any unfairness in the proceedings arising from the delay, but suggested only that the delay meant that the Arbitrator was more likely to make errors. The arbitrator’s decision was thorough and complete. While the Nelsons object to her findings, they were reasonably based on the evidence before her, and one cannot get around the restriction of appeal on questions of law by asserting delay lead to errors in fact.

There was a remedy available to the parties if they believed the delay was undue and they did not exercise that remedy. [ 60 ] This particular allegation raises the question of whether the appeal was premature. The Arbitrator titled her decisions as “Interim Awards”, suggesting she retained jurisdiction to deal with further issues. [ 61 ] Further, the Nelsons have never sought a variance from the City, although evidence introduced at the hearing suggested that this was a possible approach. Mr.

Benoit made it clear that no variance had been sought from the City, but that variances are often granted after construction when such problems arise. The City had refused to approve the lot grading certificate because the slope on the property does not comply with the architectural controls, among other things. Mr. Benoit explained that the developer approves that lot grading as part of the area drainage plan, and issues a lot grading certificate which is then sent to the City. In the case of the Nelsons, the City filed it and did not look at it until Mr. Nelson asked them to come and inspect the property.

The City expects the developer and builder to manage this aspect and the developer is to ensure the grading matches the design grades. Neither the developer nor the builder can change the design grades without City approval. All of this is found by the Arbitrator in para 23 of the Initial Decision. Further, she found that the developer should not have approved the lot grading certificate because the grades did not match the design grades. [ 62 ] It appears that the Nelsons could have sought City approval but did not. This left the Arbitrator without evidence as to the City’s approach to the problem. 1.

Conclusion [ 63 ] Having determined that there was only one alleged error of law – the question of delay – I conclude that the appeal should be dismissed. The Nelsons only objected to the delay after the decision was rendered and did not take advantage of the remedy under the Act when there is undue delay. In light of that available remedy and the fact that the Nelsons have not established any unfairness or prejudice caused by the delay, I conclude that the duty to be fair was not breached. 2.

Other issues if in error on whether they constitute questions of law The Arbitrator found that Homexx breached its Purchase Contract with the Nelsons by failing to build the driveway at the grade required under the contract, and as a remedy required Homexx to pay to correct the driveway, either by correcting the slope or installing a reverse driveway. These remedies were raised by the evidence and the arbitrator reached a reasonable conclusion of the evidence before her. If additional evidence were required, it was up to the parties to present it to the Arbitrator at the hearing.

Were it necessary to do so, I would conclude that the Arbitrator arrived at a reasonable conclusion. IV. Conclusion [ 64 ] I dismiss both appeals. Since neither party was successful, each will bear their own costs. Heard on the 6 th and 7 th day of December, 2012. Dated at the City of Edmonton, Alberta this 11 th day of September, 2013. A.B. Moen J.C.Q.B.A.

Appearances: C. Devlin McLennan Ross LLP for Rodney and Judy Nelson G. Ferri and G. Akers, QC Nicholl & Akers for Homexx Corp.