Brad Goodsell Design Build Inc. (aka BG Custom Homes Limited) v. Leahey’s Landscaping & Contracting Ltd. Adjudicator: Eric K. Slone,, 2023 NSSM 47

SMALL CLAIMS COURT OF NOVA SCOTIA Citation: Brad Goodsell Design Build Inc. (BG Custom Homes Limited) v. Leahey’s Landscaping & Contracting Ltd. , 2023 NSSM 47 Date: 20230411 Docket: SCCH 520462 Registry: Halifax Between: Brad Goodsell Design Build Inc. (aka BG Custom Homes Limited) v. Leahey’s Landscaping & Contracting Ltd. Adjudicator: Eric K.

Slone, Heard: Via zoom on March 16, 2023, in Halifax, Nova Scotia Decision April 11, 2023 Counsel: Self-represented, for the Claimant Self-represented, for the Defendants By the Court: [ 1 ] The Claimant (“BG”) is a builder/contractor who was doing exterior work at a high-end property in Halifax, which included building a retaining wall and other work. [ 2 ] The Defendant (“Leahey’s”) was hired as a subcontractor to perform excavation work, in what was anticipated to be two phases. [ 3 ] On July 22, 2022 Leahey’s provided an estimate for the first phase of work, which quoted a price of $25,000.00 plus HST. [ 4 ] During that work Leahey’s discovered some obstacles.

One was a hidden foundation wall that had to be excavated. The other was buried tree trunks. Each of these items was added as an extra charge of $2,500.00, making the total for the work $30,000.00 plus HST. [ 5 ] The charge for the foundation wall was agreed to in advance. The charge for the stumps was accepted after the fact. Payment was made without reservation. [ 6 ] There is no basis to revisit the charges for this phase. [ 7 ] The second phase was not based on a fixed price, but was based on hourly rates for machinery and operators. Not everything went smoothly.

In the end, a bill for $20,045.00 plus HST ($23,051.75) was presented. Some aspects of it were disputed, with the result that Leahey’s commenced a Small Claims Court action (not this claim) to collect this amount. It also threatened to file a builder’s lien against the owner of the property, which BG wanted to avoid. [ 8 ] What followed was an exchange of settlement negotiations, which would normally be inadmissible but for the fact that Leahey’s claims that this resulted in a settlement that precludes this claim being successful.

[ 9 ] After some negotiation, Leahey’s was prepared to accept $18,750.00 to conclude the claim. The offer was contained in a December 13, 2022 letter from Leahey’s lawyer, which stated: This is the final offer. If a certified cheque or bank draft made out to BOYNECLARKE LLP in the amount of $18,750.75 is not received by end of day (5:00 pm) on December 15, 2022, the Claim for Lien will be filed on the property on December 16, 2022. [ 10 ] On the 14 th of December 2022, BG countered with two options.

It offered to settle outright for $16,815.88, or it would pay the $18,750.75 “under protest.” The under protest option would have required Leahey’s to provide further documentation to justify its invoice. Some supporting information had already been provided, which BG apparently considered inadequate. [ 11 ] This was met with a response from Leahey’s lawyer on December 15 at 1:27 p.m. which stated: .... my client is not willing to accept any funds “under protest.” Their final offer remains at $16,305 plus HST ($18,750.75) to resolve all outstanding matters between the parties.

If this amount is sent to the office today by the deadline, we will consider this to be acceptance of these terms and that all matters between the parties will be concluded and resolved. If funds aren’t received, we will proceed with a lien in the full amount outstanding to my client. [ 12 ] BG made the payment by the deadline.

Leahey’s did not file a lien, and had its Small Claims Court matter removed from the docket. [ 13 ] BG says that its payment was under protest, though there was no evidence that any such limitation was written onto the cheque or bank draft. [ 14 ] On January 16, 2023, BG commenced this Small Claims Court claim seeking to recover a refund of $13,000.75 out of what it had already paid.

Its theory is that the value of its work, covering both invoices, only justified payment of $35,000.00 plus HST. [ 15 ] Leahey’s counterclaimed for the balance of its original invoice, namely $4,301.00, though its primary position is that the claim was settled. [ 16 ] The evidence in support of its theory that the entire work was only worth $35,000.00, is totally unconvincing. BG asked another contractor to give an estimate based on a hypothetical contract for the work that Leahey’s had done. The estimate was not supported by any witness. Indeed, it was not even signed, let alone sworn.

Counsel for Leahey’s had no opportunity to cross examine the maker of such an estimate. [ 17 ] I give this estimate no weight. [ 18 ] One of the flaws in BG’s theory of the case is that it already accepted the full invoice for phase one, which was $30,000.00 plus HST. This was based on a fixed price plus approved extras. BG has no right to revisit this charge based only on its unhappiness with how phase two went. [ 19 ] If its theory were accepted, the value of the work in phase two would only be $5,000.00 plus tax.

This is an extreme proposition which has not been supported by any convincing evidence. [ 20 ] Lastly, there is the question of whether the debt has been settled. Counsel for Leahey’s cited a case of mine, Construction Technologies (CTI) Inc. v. Harbour Vista Apartments Ltd. , 2016 NSSM 45 , which discusses and applies the concept of accord and

satisfaction: [ 10 ] The basic principle of accord and satisfaction is met when a debt is settled, with an amount agreed upon, that puts an end to all obligations going in either direction. In most such cases it would be inequitable for the creditor to come back later and say, in effect, “you still owe me some money.” An accord and satisfaction settles the debt and all claims and counterclaims that may have existed at the time of the payment. [ 11 ] Not every payment will constitute an accord and satisfaction, even where the paying party writes a statement “paid in full” or some such language on the cheque.

It depends on the true intention of the parties. [ 21 ] I believe that this principle applies here. The true intention of the parties was initially ambiguous. But Leahey’s was clear that it would only forego its lien rights upon a final payment of $18,750.75. BG was prepared to take advantage of that promise by Leahey’s to forego lien rights, and made the payment.

It would be inequitable for BG to have it both ways. [ 22 ] I find that the claims were settled and that neither party has a right to revisit the issues which culminated in the settlement. [ 23 ] Even if I am wrong about the debt being settled, I find that the Claimant has failed to prove that the work covered by the second invoice was not of sufficient value to justify the amount paid. ORDER [ 24 ] In the result, the claim and counterclaim are both dismissed. In my discretion, I make no order as to costs. Eric K. Slone, Small Claims Court Adjudicator