2011 QCCQ 319, 2011 QCCQ 319

YL Productivité inc. c. DDI Heat Exchangers Inc. 2011 QCCQ 319 COURT OF QUEBEC Small Claims Division CANADA PROVINCE OF QUEBEC DISTRICT OF MONTREAL TOWN OF MONTREAL Civil Division No: 500-32-110589-084 DATE: January 19, 2011 ______________________________________________________________________ BY THE HONOURABLE SUZANNE HANDMAN, J.C.Q. ______________________________________________________________________ Y. L. PRODUCTIVITÉ INC. 3410 de Bavière, Longueuil (Québec) J4M 2Y9 Plaintiff v.

DDI HEAT EXCHANGERS INC. 305 Baffin, Dollard-des-Ormeaux (Québec) H9A 3G4 Defendant ______________________________________________________________________ JUDGMENT ______________________________________________________________________ [ 1 ] Y.L. Productivité Inc. is suing DDI Heat Exchangers inc. (“DDI”) for professional fees of $3,622.23. DDI presented a cross demand for the amount of $6,790.56, claiming it suffered damages because of Y.L. Productivité's report. The evidence: [ 2 ] DDI designs and manufactures heat exchangers.

A production problem had arisen at Les Aciers Sofatec Inc., the subcontractor that fabricates DDI's equipment. Cracks appeared in the metal because of a welding problem. [ 3 ] Philippe St-Hilaire, the engineer who had designed the heat exchanger for DDI, contacted Y.L. Productivité, a specialist in the area of heavy equipment manufacturing, to resolve the problem. It was unable to determine the nature of the problem from a diagram. [ 4 ] DDI then gave Y.L.

Productivité a mandate to visit its manufacturer Sofatec, check its welding procedure to determine the cause of the problem, make recommendations and prepare a short report. Y.L. Productivité's rate was $90 per hour plus expenses. [ 5 ] Y.L. Productivité's president met Mr. St-Hilaire and Sofatec's representatives at its facility, early on December 19, 2007 and reviewed the material and the welding procedure. He found a major lamellar tearing problem and presented his solutions to resolve the problem, leaving the premises at approximately 6:00 p.m.. [ 6 ] Y.L.

Productivité prepared a short preliminary report, pending receipt of a chemical analysis of the base metals used. It sent this report to Mr. St-Hilaire and to DDI respectively on December 23, 2007 and December 28, 2007. [ 7 ] Y.L. Productivité's invoice came to $1,649.77, involving 15.5 hours including travel time. DDI paid $470.394 alleging that it corresponds to 5 hours of work. Y.L. Productivité then sent a revised bill for $1,179.38, which was never paid. [ 8 ] Y.L. Productivité sued for its consulting fees. DDI presented a cross demand. As a result Y.L. Productivité's insurance was increased by $795.

It is claiming a total of $3,622.23, representing this extra cost, the balance of its fees and damages. **********

[ 9 ] DDI maintained it had authorized Y.L Productivité to spend only 3 hours for its visit plus 2 hours of travel time to resolve a particular problem. One additional hour was allowed to prepare the report. If more were needed, Y.L. Productivité was to provide a written proposal as to the estimated cost to find a solution. Y.L. Productivité denied these allegations. [ 10 ] DDI contested the time Y.L.

Productivité spent at Sofatec's facilities as well as the time spent writing its report, which included research and consultation. [ 11 ] DDI also maintained that the element of time was crucial since approximately 20 Sofatec welders were waiting for the resolution of the problem. DDI claimed Y.L. Productivité had been hired on December 18, 2007 and although the issue was urgent, it only sent a preliminary report on December 28, 2007, advising not to act on the report; on January 23, 2008, it was still waiting for the metal analysis. [ 12 ] According to DDI, Sofatec resolved the problem on December 19, 2007.

The report DDI subsequently received, from Y.L. Productivité, was therefore useless. [ 13 ] DDI complained the extra cost it incurred resulted from Y.L. Productivité's review of the design whereas Y.L Productivité was hired to look only at the welding issue. DDI was concerned that if a design problem were found, it would be held responsible since its engineering subcontractor, Mr. St-Hilaire, had designed the equipment. [ 14 ] DDI alleged that since the solution proposed by Y.L.

Productivité for the welding problem was a redesigned joint, its manufacturer Sofatec charged DDI $40,000 for extra labour involved in correcting the problem. [ 15 ] Y.L. Productivité denied it had recommended that the equipment be redesigned; rather it considered that the fabrication should be modified. It explained that its use of the term “redesigned joint” referred to a different assemblage, which would render it easier to manufacture the equipment. In its view, the assemblage was causing the problem and not the design. Analysis: The Principal action: [ 16 ] Y.L.

Productivité is claiming the balance of its account. DDI refuses to pay, alleging it had accepted only 3 hours of service, 1 hour of travel time and 1 hour to prepare a report. Y.L. Productivité denied its mandate was limited to 3 hours. [ 17 ] The evidence does not support DDI's position. The amount of time foreseen for the visit was for a minimum of 3 hours. This necessarily implies that billing will not be less than that amount. However, no maximum time is foreseen. Y.L.

Productivité indicated that it is not possible beforehand to determine the exact amount of time required to resolve the problem. [ 18 ] Travel time to the facility was 1 hour. Therefore, a return trip is 2 hours, as invoiced. [ 19 ] DDI objected to the number of hours spent on the report, claiming it had asked for a short report. The report is, in fact, a short document, consisting of six (6) pages of large print, a number of photographs, a list of test reports, description of welding methodology and a chemical analysis of a number of samples.

According to the un-contradicted evidence, it was intended to provide DDI with Y.L. Productivité's findings; it also had to serve DDI if it was sued by Sofatec. [ 20 ] DDI reproached Y.L. Productivité for having done research in the literature and consulting a colleague. This argument is not retained. Such work is not unusual particularly in light of the report's intended purpose, namely to provide DDI with Y.L. Productivité's findings and to serve DDI if a lawsuit was instituted by Sofatec. [ 21 ] As for DDI's allegation that Y.L.

Productivité's work was useless given that Sofatec solved the problem on December 19, 2007, it must be recalled that Sofatec had been working on the problem since it arose in early December and Y.L. Productivité's visit was only scheduled for December 19th. In addition, Y.L. Productivité was consulted to obtain another opinion. [ 22 ] In sum, Y.L. Productivité was hired to determine the cause of a welding problem raised by Sofatec and to provide its recommendations. Y.L. Productivité carried out the mandate, as requested by DDI.

No time limit was foreseen to do the review and provide a written report on its findings and recommendations. [ 23 ] DDI, having hired Y.L. Productivité, is obliged to respect its contractual obligations. Accordingly it must pay Y.L. Productions $1,179.38 for its services. [ 24 ] Y.L. Productivité is also claiming $1,647,85 for costs related to his travel, time spent preparing his case as well as moral and punitive damages. The Court does not compensate parties for the time spent to prepare and present their case. Punitive damages are granted only for a violation of the Law.

Moral damages are awarded for such claims as pain and suffering and/or psychological injuries. [ 25 ] In the present case, the Court limits the damages to the trouble and inconvenience suffered and grants a nominal amount of $200. The Cross Demand: [ 26 ] DDI is claiming $6,790.56, alleging Sofatec charged it $40,000 for extra labour costs, resulting from the proposals made to rectify the welding problem. DDI maintains Y.L.

Productivité's report caused it prejudice since it points to the existence of a design problem although its mandate was only to consider the welding problem. [ 27 ] DDI is claiming $3,240 for 36 hours at $90 per hour for time spent dealing with Sofatec to undo the damages allegedly caused by Y.L. Productivité's report and to negotiate a reduction of Sofatec's costs. It is also claiming $2,500 as part of the costs charged by Sofatec, as well as its court costs and taxes.

[ 28 ] However, the document produced in support of its claim is a bill from Sofatec for $40,000, which reads as follows: “SR&D experimental work on the Flange Gasket of a rectangular heat exchanger to test performance under extreme high pressures” [ 29 ] The invoice indicates that work was performed in the context of a research and development project.

A claim has been made to recover tax credits, the result of which is not yet known. [ 30 ] DDI also submitted another document from Sofatec which states that the extra manufacturing charges of $40,000 was based on “overruns” of the time lost, caused by configurations as stated in Y.L.

Productivité's report as well as a report from Wolfgang Blach, an engineer, who wrote: “Although from a functional end-user point of view the final geometry is the same, from a manufacturing point of view this is indeed a design change, due to the work required in making the weld preparations (grinding and/or machining of the bevels).” [ 31 ] It should be recalled that Y.L. Productivité was hired to find the cause of a welding problem and recommend solutions. It did so. [ 32 ] DDI contends that Y.L.

Productivité's report points to redesigning the joint and as a result, it suffered damages since Sofatec charged it for “overrun” costs. [ 33 ] Y.L. Productivité points out that its report was never destined to be provided to Sofatec; rather it was to be used in an eventual lawsuit. Moreover, Y. L. Productivité claims it indicated that the problem was caused by the manufacturing process and the term it used, namely “redesigned joint” referred to a different assemblage and not to the design per se . [ 34 ] If the problem is a manufacturing problem as Y.L.

Productivité contends, then Sofatec should be responsible for the cost of rectifying it. If the problem resulted from a design deficiency, the engineer who prepared the design would ultimately be responsible for his concept. In fact, as a result of DDI's damages, it has sued the corporation under which, Phillipe St-Hilaire, its design engineer operates, for that corporation's alleged errors and omissions [ 35 ] However, the Court is not called upon to determine this issue. In either scenario, Y.L.

Productivité, having been mandated to resolve a problem, is not responsible for its conclusions. [ 36 ] Consequently, no condemnation will be made against Y.L. Productivité for the hours DDI spent with Sofatec, with respect to issues raised by that company. For the same reason, Y.L. Productivité is not liable for any costs charged by Sofatec. [ 37 ] DDI is also claiming compensation for the preparation of its Court case and the time spent in Court. Such claims are not granted. [ 38 ] Given that DDI's cross demand, which is completely unfounded, resulted in an increase in Y.L.

Productivité's insurance rates, the Court awards Y.L. Productivité the amount of $795. In the Court’s view, the damages claimed are directly related to the frivolous cross demand presented against Y.L. Productivié. FOR THESE REASONS, THE COURT: GRANTS Plaintiff's claim; CONDEMNS D.D.I. Heat Exchangers Inc. to pay Y.L. Productivité inc. $2,174.38 plus interest at the legal rate and the additional indemnity foreseen by

section 1619 of the Civil code of Quebec since April 25, 2008 plus judicial fees of $176. DISMISSES Defendant's cross demand. __________________________________ SUZANNE HANDMAN, J.C.Q. Date of hearing: October 26, 2010