Thompson Bros (Constr) Ltd v, 2014 ABQB 708

Court of Queen ’ s Bench of Alberta Citation: Thompson Bros (Constr) Ltd v 823334 Alberta Ltd, 2014 ABQB 708 Date: 20141118 Docket: 0603 05693 Registry: Edmonton Between: Thompson Bros. (Constr.) Ltd. Plaintiff/Defendant by Counterclaim (Respondent) - and - 823334 Alberta Ltd and Stuart Eggleton Defendants/Plaintiffs by Counterclaim (Applicants) _______________________________________________________ Reasons for Judgment of the Honourable Madam Justice D.C. Read _______________________________________________________ Facts:

[ 1 ] In 2002, Larry Thompson was the vice president of Thompson Bros. (Constr.) Ltd. a family owned construction company. In his position he met with customers and bid on projects. On October 2, 2002, Stuart Eggleton met Larry Thompson in his office and asked him for a quotation to perform excavation work, site grading and construction of access roads for land near Morinville. This visit set in motion the events that culminated in a lawsuit that went to a one-day trial on November 13, 2014. [ 2 ] The Statement of Claim commencing this lawsuit was issued by Thompson Bros. on May 9, 2006.

It named two defendants: 823334 Alberta Ltd. (“823”) and Stuart Eggleton and claimed the remainder owing on two invoices for excavation work, totalling $116,548.71. [ 3 ] By order dated March 17, 2011, this action was dismissed against 823 because of a limitation issue. Stuart Eggleton is the sole remaining defendant. [ 4 ] There are two narrow issues between the remaining parties: a. Did Stuart Eggleton contract personally with Thompson Bros for the work they performed? b. If the answer to the first question is yes, was there an acknowledgment of a debt given by Mr.

Eggleton’s lawyer to extend the limitation period that would otherwise have expired? [ 5 ] After the initial meeting between Mr. Thompson and Mr. Eggleton, a quotation dated October 22, 2002 and addressed to Sterling Properties attention Stu Eggleton was faxed from an employee of Thompson Bros. identified as S. Grant Smythe. Mr. Thompson said Mr. Smythe was the chief estimator for Thompson Bros. at the time. The quotation set out unit prices for four types of stripping of soil and excavation and set out as well, a

schedule of what was called “force account” rates for machinery. The quotation referred to “quantities shown from your site plan” and contained specific estimated quantities of material to be stripped or excavated. An amount, called “total tender” was provided in the estimate; this was just a calculation of the estimated quantities multiplied by the unit prices. [ 6 ] A nine page set of drawings, that included elevations and site plans was provided by Ronald Hubscher, an employee of Thompson Bros. in answer to undertakings given. These drawings were made part of Exhibit 16. Mr.

Thompson’s evidence was that these were the drawings that Grant Smythe would have had in order to prepare the quotation. He recalled that Mr. Smythe had shown him some drawings connected with the job but was not able to clearly identify those in Exhibit 16, as what Mr. Smythe had shown him and at one point in cross examination denied they were the same. [ 7 ] Mr. Eggleton said he could not recall whether he had left any drawings with Mr. Thompson but he was certain that he did not provide the exhibit 16 drawings to Thompson Bros. and he does not know where they came from. Mr.

Eggleton identified many of the drawings as depicting work and plans for a neighbouring property owned by Celtic Homes Inc. (“Celtic”). Mr. Smythe has left Thompson Bros and did not give evidence. [ 8 ] The parties agree that Thompson Bros. did work on the site set out in the drawings and that the work was done properly and at the unit prices set out in the quotation. [ 9 ] The land in question consists of two adjoining parcels of land – one owned by a numbered company, 997045 Alberta Ltd. (“997”). This corporation is presently held 58.1% by Stuart Eggleton.

His evidence was that he was likely the sole shareholder and director of this corporation in 2002. The other parcel was then and is now owned by Celtic. Stuart Eggleton is not and has never been either a shareholder or a director of Celtic and no person or corporation related to Mr. Eggleton has or ever had an interest in Celtic. Corporate search results as of March 13, 2004 for 997, Celtic and 823 were made exhibits in this action. [ 10 ] Mr.

Eggleton’s evidence was that in 2002 both Celtic and 997 were seeking subdivision of their respective parcels of land and he was cooperating with Celtic and its principals at the time in order to obtain subdivision of both parcels. He needed some earth work done to build berms on the land owned by 997 because the berms were a condition of subdivision approval for the residential development planned on 997’s land. Celtic’s proposed subdivision was for a planned industrial development on their land. Celtic needed the berms and other extensive earth work done as well. Mr.

Eggleton said that the exhibit 16 drawings detailed the work to be done on the Celtic land including excavation for a large drainage pond.

While it was not clear from his evidence in chief whether the drawings also showed all the earth work to be done on 997’s land, it was clear from his evidence that at least one of the berms was to be located on the boundary between Celtic’s and 997’s lands. [ 11 ] The numbers shown on Exhibit 16 were sometimes difficult for both the witnesses and me to read because the copies were not clear, but it appears the quantities of earth to be moved set out on at least some of the drawings, particularly one showing grading apparently for a large industrial structure, are similar to but not the same as those found in the quotation. [ 12 ] It has been agreed by the parties in this lawsuit that on or about October 24, 2002, Thompson Bros. orally agreed to perform services relating to provision of materials, equipment and services in order to complete excavating, site grading and construction of access roads for “a subdivision” at or near Morinville. [ 13 ] It is also agreed that Thompson Bros. completed the work on both the 997 lands and the Celtic lands between October 30, 2002 and November 15, 2002. [ 14 ] It is further agreed that on about December 3, 2002, Thompson Bros. invoiced for the work in the total amount of $220,074.50 plus GST of $15,405.22.

Thompson Bros. also issued a further invoice amount of $999.06 plus GST of $69.93 on April 3, 2003. [ 15 ] Both invoices were addressed to 823 at 205, 9940 106 Street in Edmonton (the “Invoice Address”). The corporate search results made exhibits show that this address is not the registered office for either 997 or Celtic. This was, however, the address on a business card Mr. Eggleton left with Mr. Thompson at their October 2 meeting.

[ 16 ] The corporate search result for 823 indicates that corporation has been dissolved since July 2005. The Invoice Address was not the last registered office for 823 either. The only reference to the Invoice Address in any of the corporate searches is found on the March 2014 search result for 823. It shows that at dissolution, the records for the corporation were in the possession of Stuart Eggleton, in care of the Invoice Address. The search also shows the Invoice Address as the address for Stuart Eggleton as director of 823 at the time of dissolution.

Discussion: Issue 1: Did Stuart Eggleton contract personally with Thompson Bros.? [ 17 ] I conclude on the evidence that the Plaintiff has not proven that it had an agreement with Stuart Eggleton for the work performed so as to make Mr. Eggleton personally liable. [ 18 ] Although there was some writing associated with this contract, which I will discuss below, the agreement reached on or about October 24, 2002 was an oral contract. Oral contracts are, of course, as enforceable in law as written contracts.

The difficulty with an oral contract is that their terms are sometimes difficult to ascertain, reliant as they are upon what the parties to a contract say they agreed to. Here, the only disagreement is as to who Thompson Bros. contracted with to do the work. [ 19 ] The onus is on the Plaintiff to prove that it contracted personally with Mr. Eggleton. [ 20 ] Mr. Thompson’s evidence was that he understood he was making the agreement with Mr. Eggleton personally. He said Mr. Eggleton told him that he was representing himself personally when he came to the office on October 2 and it was Mr.

Eggleton who called to tell them to go ahead once he received the quotation. His evidence was that he thought the exact words Mr. Eggleton used were “It’s good. Let’s get going.” [ 21 ] He also said the first time he heard 823 mentioned was when it came time to invoice for the work done. His evidence was that he asked Mr. Eggleton to whom the invoice should be sent and Mr. Eggleton said to send it to 823. He said he had never heard of Celtic Homes when he had his initial discussion with Mr. Eggleton.

He did agree that he heard of Celtic Homes at some point in his dealings on this contract; he said he knew Celtic Homes was involved because that was the name of the over-all property. He said he also knew they owned part of the land. He said he did not meet with anyone from Celtic and there was no reason to do so since it was Mr. Eggleton who was “doing the job”. [ 22 ] However, Mr. Thompson’s cross-examination evidence was not nearly so clear and my impression of his evidence was that Mr.

Thompson did not have a clear idea, even at trial, of what entity or entities Thompson Bros. dealt with. [ 23 ] I find that Mr. Thompson does not have a clear memory of exactly what was discussed in his office on October 2, 2002 and that perhaps he was never certain with whom Thompson Bros. was contracting. As he said, his focus was upon getting the job, getting it done and getting paid for it, not upon with whom he was contracting. [ 24 ] In cross-examination, Mr. Thompson was taken to evidence he gave in a previous examination under oath where he was asked whether Mr.

Eggleton told him he, personally, and not one of his companies, wanted to retain Thompson Bros., his answer was “no”. When asked to explain this statement, Mr. Thompson said that Mr. Eggleton told him they would be working for him and to him that meant the same thing. [ 25 ] However, he was then taken to an affidavit he swore in 2009 where he stated Thompson Bros. was retained by Mr. Eggleton and 823 and that the agreement was that 823 would pay for all of the services regardless of on whose land the services were performed. When asked to explain this statement, Mr. Thompson responded by saying that Mr.

Eggleton said he would pay for it and how he would pay is not important as long as Thompson Bros. got paid. [ 26 ] The paper work in this matter similarly evidences at least lack of precision and perhaps confusion about names. Both invoices have the words ‘Celtic Homes’ directly below the address. In his evidence, Mr. Thompson at first said he had never heard of Celtic Homes when he reached agreement to do the work. He said the reference on the invoices was an error or a typo. He then said that the reference could be because it was the name of the property.

However, he was also shown internal documents from Thompson Bros. listing the names and hours of people who had worked on the project. The reference on one of the documents was to “Celtic Homes Morinville”. The reference on another said “Sterling Properties”. [ 27 ] It was suggested to Mr. Thompson in cross-examination that there were two names on the internal documents because Thompson Bros. was well aware that they were dealing with two different entities. He had difficulty responding but finally admitted that some work had been done for Celtic – but only for one day.

This admission seems directly contradictory to his previous evidence that he had “never heard” of Celtic Homes or that it was simply the name of the property. [ 28 ] Mr. Thompson’s evidence was that Mr. Eggleton gave him his card when he came into the office and that was one of the reasons he believed he was dealing with Mr. Eggleton personally. The business card in evidence was identified by Mr. Eggleton as the one he left with Mr. Thompson. The card said “Sterling Properties” with Mr. Eggleton’s name beneath. Mr. Eggleton said he gave this card to Mr. Thompson only to provide some contact information. Mr.

Thompson said during cross-examination that he assumed Sterling Properties was the name of a company. However, Mr. Thompson also said that at their first meeting he was not sure if Mr. Eggleton had a company and he had not mentioned one. [ 29 ] The quotation was sent to “Sterling Properties attention Stu Eggleton”, at the address shown on the business card. As I have already indicated, the invoices were sent to 823 at the same address. [ 30 ] Mr. Eggleton’s evidence was that the name Sterling Properties is not a corporation, at all but a trade name. It was agreed by

the parties that in 2002, the trade name was owned by 714574 Alberta Ltd., a corporation owned by Mr. Eggleton’s wife. A declarationof trade name was made in 1997. [31] A sketch plan was attached to the December 3, 2002 invoice, showing two sites, labelled site 1 and site 2. On the sketch thereare also items labelled berm 1, berm 2, and berm 3 and others marked pile 1 and pile 2. The sketch plan is not otherwise identified. Noris it referenced in the invoice.

However, I assume, because no one gave any evidence to the contrary, that the sketch was sent along withthe invoice and was intended to show where the work that was billed for in the invoice had been done. Mr. Eggleton identified the bermlabelled berm 3 as running along the border of 997’s property but said 997’s land was not otherwise a part of the sketch and wouldgenerally be located in the part of the sketch that had an arrow and the letter ‘N’ and showed only which direction on the sketch wasnorth but was otherwise blank.. [32] None of this documentation is consistent with Mr.

Thompson’s stated understanding that he contracted personally with Mr.Eggleton and that he had no idea that any corporation was involved. Mr. Thompson’s evidence in cross-examination is also inconsistentwith what he said in examination in chief. [33] On the other hand, the documentary evidence is consistent with Mr. Eggleton’s evidence. [34] Like Mr. Thompson, Mr. Eggleton cannot recall exactly what was said at the October 2 meeting. He does recall, however,meeting with Mr. Thompson and another person and said he “cannot imagine not telling them that 997 and Celtic were doing this work”.

He said he knows he made it very clear that Celtic was involved although he says he told them that 823 would pay the bills. [35] However, Mr. Thompson was clear that a lot of the work that Thompson Bros. did was actually for the benefit of CelticHomes, on their land, and in reference to their subdivision. He agreed, though, that he was the one who met with Mr. Thompson and itwas him who told Thompson Bros. to proceed to do the work. [36] I conclude that Thompson Bros. was aware of the involvement of Celtic Homes.

The reference on the invoice to “CelticHomes” is an indication that Thompson Bros. knew the work was associated with that company, as is the internal documentation whichseparates the workers’ hours into two groups – one labelled ‘Sterling Properties’ and one labelled ‘Celtic Homes’. I conclude as wellthat Thompson Bros. was aware that 823 had agreed to be responsible for accounts. The invoices were sent to 823 and cancelled chequeswere entered into evidence to show that a total of $120,000 on account was paid by cheque drawn on the bank account of 823. [37] However, Mr.

Eggleton did not agree to be personally responsible and I conclude that Thompson Bros. was well aware of this,as well.. Mr. Eggleton’s uncontradicted evidence was that he has never received an invoice addressed to him personally and no demandletter was ever sent to him personally. Nor, on the evidence, did Thompson Bros. ever make any other demand on him to pay the unpaidportions of the invoices. In fact, Mr. Eggleton said, the first notice he had of any claim against him personally was when he received theStatement of Claim.

These are not the actions of a plaintiff who considers another to be personally liable. [38] Admittedly, Mr. Eggleton’s actions at the time did little to clarify the lack of precision. Mr. Eggleton agreed in cross-examination that he received the quotation sent by Mr. Smythe. When asked to explain the similarity between the quotation numbers andthose in Exhibit 16, he said he did not pay any attention to the estimate numbers when he received the quotation as he was interestedonly in the unit prices.

He agreed as well that he never questioned why the quotation was sent to Sterling Properties and that he providedno written documentation to anyone at Thompson Bros. respecting 823, 997 or Celtic. It may be that Mr. Eggleton also did not addresshis mind to exactly whom he was contracting on behalf of. He also agreed that 997 later sued Celtic to try to recover the monies owed toThompson Bros. but said this was as a favour to Thompson Bros. [39] However, Mr. Eggleton was adamant that he did not contract with Thompson Bros. personally and had no intention to do so. [40] The evidence is not crystal clear.

It may be that Mr. Eggleton was vague in his discussion with Mr. Thompson about whatentity was entering into the oral contract with Mr. Thompson. It may be that Mr. Thompson did not address his mind to the issue at thetime. However, on the issue of what was actually said at the meeting, where their evidence differs, I prefer that of Mr. Eggleton to that ofMr. Thompson. The reliability of Mr. Thompson’s evidence and his credibility was damaged by his contradictory evidence on cross-examination. I conclude on the basis of Mr. Eggleton’s evidence that Mr. Eggleton did not tell Mr.

Thompson that he would bepersonally responsible to pay for the work done and that he, personally, was contracting with them. [41] It is likely that Mr. Eggleton was acting as an agent for Celtic Homes at the time and also as an agent for either or both of 823,whom Mr. Eggleton agreed would be responsible for the invoices, and/or 997, the owner of the lands.

While he certainly did not use theword ‘agent’, the evidence shows that he mentioned the involvement of at least 823 and Celtic and the documents show that ThompsonBros. was aware of the existence of both of these entities. [42] I have read Con-Force Products Ltd v. Rosen et al, (SK KB), 64 D.L.R.(2d) 63, relied on by the Plaintiffbut in that case the situation was quite different. In Con-Force, a Mr. Rosen and his partner a Mr. Boyle intended to build a motel and,for that purpose incorporated a company.

They engaged architects but never revealed the existence of the company to the architects.However, the architects were empowered to act as agent to call for and review tenders for the construction of the motel. They did so andthe construction company bid on the project, sending a letter quoting for the work to Mr. Rosen in care of a business name. The letterspecified that acceptance of the offer set out in the letter would constitute a binding contract. Notwithstanding that the letter was sent toMr.

Rosen, the architects wrote to the Plaintiff by return indicating they were “authorized by the owners” to accept the offer. The courtfound that Rosen had contracted personally in the circumstances. [43] Mr. Rosen never mentioned the existence of the corporation to his agent, the architects, and the architects were thus, unaware,in their dealings with the plaintiff as agent for the owners that the owners were anyone else than Rosen and Boyle. Indeed the architecttestified to this effect.

As a consequence, of the architects’ representation, the Plaintiff made the offer to the individual and the architectsaccepted on behalf of the individual. [44] The facts in Con-Force are far different from the situation here. In his dealings with Mr. Thompson, Mr. Eggleton was acting

as the agent. Unlike the architects in Con-Force , Mr. Eggleton was under no misapprehension that he was contracting for himself personally. In fact, he was certain he was not. Whatever, Mr. Thompson thought, unlike the plaintiff in Con-Force , Thompson Bros. did not make an offer in writing addressed personally to Mr. Eggleton. Instead, the quotation was addressed to Sterling Properties attention Stu Eggleton. Mr. Thompson’s evidence was that he ‘thought’ Sterling Properties was a corporation. [ 45 ] For the foregoing reasons, I conclude the Plaintiff has not proven that Mr.

Eggleton personally was a party to the contract. Issue 2: Was there an acknowledgment of a debt given by Mr. Eggleton’s lawyer to extend the limitation period which would otherwise have expired? [ 46 ] Because I have concluded that Mr. Eggleton is not personally liable, I need not address the limitation question. [ 47 ] Unless for special reason, costs should follow the event. If desired, the parties may further address costs within 60 days. Heard on the 13 th day of November, 2014. Dated at the City of Edmonton, Alberta this 17 th day of November, 2014. D.C. Read J.C.Q.B.A. Appearances: Roderick C.

Payne Hustwick Payne for the Plaintiff/Defendant by Counterclaim Kentigern A Rowan, QC Ogilvie LLP for the Defendants/Plaintiffs by Counterclaim