2014 QCCQ 13520, 2014 QCCQ 13520

Aura Maison inc. c. JGK Construction & Tec inc. 2014 QCCQ 13520 COURT OF QUEBEC CANADA PROVINCE OF QUEBEC DISTRICT OF MONTREAL TOWN OF MONTREAL « Civil Division » N° : 500-22-209868-143 DATE : November 28, 2014 ______________________________________________________________________ BY THE HONOURABLE NATHALIE CHALIFOUR, J.C.Q. ______________________________________________________________________ AURA MAISON INC. Plaintiff c.

JGK CONSTRUCTION & TEC INC. -et- HANG ZHANG Defendants ______________________________________________________________________ JUDGMENT ______________________________________________________________________ [ 1 ] The Plaintiff, Aura Maison Inc. ( Aura ), claims from the Defendants, JGK Construction & Tec Inc. ( JGK ) and Mr.

Hang Zhang ( Zhang ), solidarily, the sum of $11,833.19, representing the unpaid balance of an invoice for the work performed by Aura at the request of the Defendants. [ 2 ] JGK denies owing the amount claimed, for the following reasons: - As Aura was to be paid only when and if JGK was paid by the work provider and since JGK was never paid for the portion of the work done by Aura, it owns nothing to the latter; and - the work done by Aura had defects and was not performed in accordance with the rules of the trade. [ 3 ] As for Zhang, President and majority shareholder of JGK, he denies having any personal liability and has no contractual relationship with Aura.

THE QUESTIONS IN ISSUE 1- What are the terms of the agreement concluded between the parties as to Aura's remuneration? 2- Are the Defendants justified in complaining about the defects in the work and hold Aura liable? 3- Is Zhang personally liable? THE FACTS [ 4 ] In 2012, a contract is concluded between JGK and its client 9254-3164 Québec Inc. by which it undertakes to renovate and transform a building into a daycare for an amount of $262,386.96. [ 5 ] In the Spring of 2013, Zhang contacts Mr. Abou Jaoudé (Abou Jaoudé), the principal of Aura, to sub-contract part of the work in the back courtyard.

[ 6 ] On April 6, 2013, a fixed price contract is concluded between the parties for an amount of $15,521.63 [1] . The work to be performed by Aura consists namely in modifying the back staircase, demolish the garage, prepare the grounds to receive grass and organize a play area. The work starts at the end of April. [ 7 ] In the course of the work, JGK modifies in part the initial work order. On June 3 rd , 2013, the parties sign a new fixed price contract, for an amount of $19,833.19 [2] to replace the first contract.

In addition to the work Aura was to initially perform, it had, amongst other items, to provide and install a metallic fence. [ 8 ] Aura completed the work at the end of June 2013. JGK had by then, paid $8,000 in three instalments, $3,000 on April 17, 2013, $2,000 on May 2 nd , 2013 and $3,000 on June 3 rd , 2013. [ 9 ] As Aura only received $8,000 out of the total amount of the invoice of $19,833.19 [3] , it institutes its action on February 19, 2014.

THE ANALYSIS 1- What are the terms of the agreement concluded between the parties as to Aura's remuneration? [ 10 ] Defendants invoke a condition with respect to the remuneration of Aura that is not provided in the contract concluded between the parties, neither in the initial or final versions. [ 11 ] Abou Jaoudé is categorical, Aura would never have agreed to purchase the material and work during several weeks without any guarantee of being paid.

Moreover, Aura had no relationship with JGK’s client and no control of the work site. [ 12 ] The Court has no hesitation in concluding that, if JGK and Zhang, an experienced businessman, truly wanted Aura’s payment to be conditional on JGK’s own payment by its client, they would have specifically provided it in the contract.

The clause dealing with remuneration is one of the essential clauses of the agreement. [ 13 ] It is very unlikely that the Defendants would have agreed to sign two contracts with Aura without insisting that the condition, dealing with the remuneration of Aura, be included. [ 14 ] In civil matter, a party asserting a right must prove, on the balance of probabilities, the facts on which his claim is based.

This concept was explained by the authors Pierre Tessier and Monique Dupuis [4] in the following manner: En matière civile […] [la] preuve doit établir l’existence de faits, au moins de façon vraisemblable. […] Un degré raisonnable de certitude signifie un degré de probabilité supérieur à 50 %. La prépondérance est la probabilité, et la probabilité, c’est ce qui est « certain » à 51%, et non à 100%. Le résultat atteint peut donner une approximation de la vérité, ce qui suffit en vertu de la norme de prépondérance.

Tant mieux si la preuve est certaine, mais ce n’est pas essentiel. […] Il faut une preuve claire et convaincante . [ 15 ] In the present matter, the Defendants did not present, by a preponderance of evidence, facts which would prove the existence of the condition they assert.

Consequently, the Court does not accept the defence raised by Defendants, that, since JGK was not paid by its client, they owe nothing to Aura. 2- Are the Defendants justified in complaining about the defects in the work and hold Aura liable? [ 16 ] The Defendants never raised any complaints or ask, either verbally or in writing, that Aura correct its work.

Yet, throughout the time Aura was on the work site and executed its work, Zhang and his team were present, therefore, could easily have asked Aura to correct any deficiencies, if necessary. [ 17 ] Subsequently, no demand letter or written or verbal notice was given to Aura. The latter was ignorant of the Defendant’s dissatisfaction with the work that they now complain of. Having completed the work order, Aura left the site confident it would be paid and thus it had entirely fulfilled its obligations. [ 18 ] In fact, the Defendants never addressed a claim to Aura.

It is only in their Plea that the Defendants complain for the first time of Aura’s poor workmanship, without ever providing any description of the complaints. [ 19 ] The first time Aura learned of the specific complaints regarding its work is on October 2 nd , 2014, a few days before the trial. Aura then received an extract of a report written by a third party at the request of the work provider. [ 20 ] As provided in articles 1595 to 1598 of the Civil Code of Quebec , a demand letter was required prior to a legal action being instituted.

Aura had the right to this demand letter, at the appropriate time, outlining the complaints, to allow it to verify the state of the work, correct any problem or take whatever else measures to minimize its damages. [ 21 ] In his work, the author Vincent Karim [5] explains that, in the construction field the client must, except in exceptional circumstances notify the contractor of the poor workmanship within a reasonable delay of its discovery: Le client ne peut retenir aucune somme d’argent s’il ne met pas l’entrepreneur en demeure d’exécuter ses obligations. Il doit donc donner

à l’entrepreneur l’opportunité réelle de remédier à son défaut. Ainsi, lorsque l’entrepreneur propose des solutions à son client qui les refuse en procédant à la résiliation unilatérale du contrat, ce dernier pourra difficilement réclamer de l’entrepreneur les coûts des corrections alors qu’il ne lui a pas offert, en réalité, la possibilité de procéder lui-même à l’exécution de travaux correctifs. Ainsi, le client ne peut utiliser la retenue du solde contractuel aux fins du paiement de la garantie avant de faire parvenir à l’entrepreneur sa demande formelle d’exécuter, en nature, son obligation.

Les exceptions à cette nécessité de mettre en demeure formellement l’entrepreneur sont codifiées à l’

article 1597 C.c.Q .. Il appartient donc au maître de l’ouvrage de faire la preuve que les conditions relatives à l’existence de l’un des cas de mise en demeure de plein droit sont remplies. Ainsi, à

titre d’illustration, l’entrepreneur est en demeure de plein droit lorsqu’il manifeste clairement son intention de ne pas exécuter son obligation.

De même, l’entrepreneur remplira les conditions d’application de ce cas de mise en demeure de plein droit s’il connaissait bien l’exigence de fournir une garantie spécifique telle que libellée au contrat de construction, et que malgré les demandes qui lui ont été adressées par son client, son défaut persiste. [ 22 ] These exceptional circumstances are, for example, when the contractor clearly states that he will not fulfill his obligations or if the contractor was aware of the specific guarantee he had to provide, as outlined in the contract, and, notwithstanding the requests made by his client remains in default. [ 23 ] In this matter, none of the exceptional circumstances mentioned hereinabove, apply: • There was no urgency; • At the time Aura left the work site, the daycare was not in operation.

On the date of the hearing, the owner of the building had just received its permit to operate the daycare; • Aura was never informed of the defects, therefore it was never in the position to refuse to abide by its obligations or correct the work. [ 24 ] In Gérald Théoret Inc. c.

Couverture Germain Thivierge Inc. [6] , the court reaffirms the principle that the purpose of the demand letter is to allow the contractor to learn the nature of the complaints, to allow him to repair the defects, therefore providing him with the opportunity of executing his obligations . [ 25 ] The Court concludes that, in light of the absence of any demand letter or prior notice to Aura, it does not accept the Defendants’ arguments on this issue. 3. Is Zhang personally liable? [ 26 ] The contract in issue was concluded between Aura and Mr : Adam Zhang or JGK construction .

The July 11, 2013 invoice is addressed to JGK or Adam Zhang . [ 27 ] Hang Zhang is often called “Adam”; this explains the use of this surname in the contract and the invoice. [ 28 ] Zhang alleges not being able to read French and that in fact he did not read the contracts. However, the portion of the contracts dealing with his personal liability is written in English, as well as the description of the work to be performed by Aura. [ 29 ] Should Zhang not have read the contract, he would be the author of his own misfortune.

However, the Court does not give any credence to Zhang’s affirmation that he blindly signed the contract, since he had a second opportunity to do so at the signing of the second contract. Zhang could have easily crossed out his name if he did not wish to be personally liable. FOR THESE REASONS, THE COURT: GRANTS Plaintiff Aura Maison Inc.’s action ; CONDEMNS the Defendants JGK Construction & Tec Inc. and Hang Zhang, solidarily, to pay to Plaintiff the sum of 11 833,19 $ with interest at the legal rate plus the additional indemnity provided at

article 1619 C.C.Q., as of February 19, 2014, WITH COSTS . __________________________________ Nathalie Chalifour J.Q.C. Me Martina Bakula LEGAL LOGIK INC. Attorney for Plaintiff

Me Éric Steinberg Étude Éric Steinberg Attorney for Defendants Date of hearing : October 22, 2014