) ) EBC Inc. Applicant – v. –, 2023 ONSC 671

CITATION : EBC Inc. v. City of Ottawa, 2023 ONSC 671 OTTAWA COURT FILE NO.: 22-88431 DATE: 2023-01-30 ONTARIO SUPERIOR COURT OF JUSTICE BETWEEN: ) ) EBC Inc. Applicant – and – City of Ottawa Respondent ) ) ) ) ) ) ) ) ) G. Cullwick, for the Applicant R. Ghignone / R. Tam, for the Respondent ) HEARD Via Zoom: December 01, 2022 DECISION ON APPLICATION P.J. BOUCHER J. [ 1 ] The applicant, EBC Inc. (“EBC”), seeks the following: a. A declaration that the respondent City of Ottawa (the “City”) failed to pay to EBC $124,300 including HST of holdback funds, and an order for payment; b.

A declaration that the City failed to pay to EBC $111,015.68 including HST, and an order for payment; and c. A declaration that the City failed to pay EBC interest owing in the amount of $62,197.45 , and an order for payment. [ 2 ] The City opposes the requested relief and asks that the application be dismissed with costs. Background [ 3 ] The parties entered into a design-builder stipulated price contract dated July 24, 2015 (the “Contract”) for the design and build of the Ottawa Art Gallery expansion and the Arts Court redevelopment (the “Project”).

They agreed Regis Côté & Associates (“RCA”) would be the Consultant for the Project. On the same day the Contract was signed, the parties entered into an Amendment Agreement in which they agreed, among other things, to reduce the Contract Price of $33,192,000.00 by $110,000 plus all “Value Added Taxes” thereon. The work on the Ottawa Art Gallery (the “OAG”) was substantially performed by April 26, 2018; the Arts Court redevelopment (the “OAC”) by July 19, 2019. [ 4 ] When substantial performance of the OAG portion of the Contract was reached, there were outstanding issues between the parties.

They wished to avoid the registration of a construction lien, the time limit for registration of which would expire, with respect to the OAG portion of the Contract, on July 03, 2018. The parties accordingly negotiated an agreement (the “Lien Agreement”) effective as of July 03, 2018, though it was only signed by the parties on September 18, 2018. [ 5 ] Briefly stated, the Lien Agreement established a timeframe for the mutual exchange of documentation, mediation and arbitration. The parties were unable to resolve their issues through mediation and accordingly proceeded to arbitration.

They argued a jurisdictional motion before the arbitrator and thereafter the process was broken down into three phases. The arbitration concluded in May 2021 when the arbitrator released his phase three decision. [ 6 ] Prior to the release of the phase three decision, EBC demanded payment of various amounts of money from the City. The parties were unable to resolve all these issues and some form part of this application. The Law [ 7 ] The parties agree on the law that applies to the questions raised in this proceeding. They part ways, however, on its

application to the facts of this case. [8] The leading decision on contractual

interpretation is Sattva Capital Corp v. Creston Moly Corp, [2014] S.C.C. No. 33. TheSupreme Court encouraged courts to take a common-sense approach and highlighted the importance of determining the parties’ intent byconsidering the words of the contract in light of the factual matrix (at para. 50). [9] The court further held that the factual matrix “should consist only of objective evidence of the background facts at the timeof the execution of the contract […], that is, knowledge that was or reasonably ought to have been within the knowledge of both partiesat or before the date of contracting” (at para. 58). [10] The Ontario Court of Appeal recently summarized the principles applicable to

interpretation of a commercial contract asfollows: a. determine the intention of the parties in accordance with the language they have used in the written document, based upon the"cardinal presumption" that they have intended what they have said; b. read the text of the written agreement as a whole, giving the words used their ordinary and grammatical meaning, in a manner thatgives meaning to all of its terms and avoids an

interpretation that would render one or more of its terms ineffective; c. read the contract in the context of the surrounding circumstances known to the parties at the time of the formation of the contract.The surrounding circumstances, or factual matrix, include facts that were known or reasonably capable of being known by the partieswhen they entered into the written agreement, such as facts concerning the genesis of the agreement, its purpose, and the commercialcontext in which the agreement was made.

However, the factual matrix cannot include evidence about the subjective intention of theparties; and d. read the text in a fashion that accords with sound commercial principles and good business sense, avoiding a commercially absurdresult, objectively assessed. (Weyerhaeuser Company Limited v. Ontario (Attorney General), 2017 ONCA 1007, at para. 65.) [11] With respect to the last point, the court must look at the result from the perspective of both parties, not simply one. What mayseem a fair result to one party could seem absurd to the other – see Kentucky Fried Chicken Canada v.

Scott’s Food Services Inc., (ONCA), at para. 27. Does the City owe EBC the holdback funds ($124,300)? Background [12] In their facta and in oral argument EBC referred to the holdback funds as the BLG trust funds. The City referred to them asthe deficiency funds. For the sake of clarity, I will refer to them as the holdback funds, primarily because that is how they are defined inthe claim for relief in the notice of application. [13] The parties agreed in paragraph 2.3 of the Lien Agreement to have the City’s lawyers, Borden Ladner Gervais (“BLG”), hold$464,743.81 in trust.

These funds were to be released in accordance with paragraph 2.6, which provided EBC until September 15, 2018 toaddress the alleged deficiencies and incomplete work (as set out in paragraph 2.4 (a) – (

g) of the Lien Agreement). The parties agreedBLG would release funds to EBC upon receipt of proof the deficiency or incomplete work had been rectified.

After September 15, 2018,however, any remaining funds would be released to the City “and used to rectify and/or complete said remaining deficiencies and/orincomplete work.” At paragraph 2.7 of the Lien Agreement the parties agreed “[a]ny amounts released by BLG to the City afterSeptember 15, 2018 may form the basis of a claim by EBC against the City, such claim to be resolved in accordance with the ClaimsProcess…” [14] Paragraph 4.4 of the Lien Agreement defines the Claims Process as follows: “a. On or before September 15, 2018, the Parties shall exchange all documentation relating to their respective claims; b.

On or before September 30, 2018, the Parties shall meet with each other to attempt to negotiate a resolution to any outstandingpending change orders and claims; c. On or before November 1, 2018, if a resolution is not achieved through the negotiation process described in paragraph 4.4(

b) above,the Parties shall agree on the appointment of a mediator and choose a date and place of mediation, which mediation is to take place nolater than January 31, 2019; and d. On or before April 30, 2019, if a resolution is not achieved through the mediation process described in paragraph 4.4(

c) above, theParties shall commence binding arbitration with an arbitrator to be agreed upon by the Parties. The Parties agree that the chosenmediator cannot also serve as arbitrator.”

[ 15 ] The parties agreed to extend the September 15, 2018 deadline to November 16, 2018. The parties now agree the $464,743.81 was never paid to BLG, although there is disagreement about the impact of this change and when it came to be known to EBC, which will be discussed in further detail later. Position of EBC [ 16 ] EBC argues they were not made aware of the failure of the City to transfer the holdback funds to BLG until early 2021. This prevents the City, EBC submits, from relying on paragraph 2.7 of the Lien Agreement.

Briefly stated, the monies could not be returned to the City if they had not been provided to BLG. [ 17 ] The parties continued to negotiate regarding the deficiencies and incomplete matters until April 2019, when EBC advised the City that all the matters in

section 2.4 of the Lien Agreement had been addressed. In total, the City paid $353,728.13 to EBC, leaving $124,300 unpaid. [ 18 ] EBC submits this holdback represents matters the City failed to bring to their attention. The whole point of the Lien Agreement, EBC argues, was to openly discuss and work toward resolving the outstanding matters. The City, EBC alleges, failed to give EBC notice, as required by paragraphs 7.1.2, 7.1.3 and 7.1.4 of the Lien Agreement, of EBC’s alleged failure to complete Contract work.

Since they were not given the chance to correct the issues, the City could not engage in self-help or keep the holdback funds, it is submitted. [ 19 ] EBC believes the holdback funds represent costs associated with allegedly deficient “as built” drawings submitted by EBC as well as repairs to concrete flooring. With respect to the former, EBC submits they had neither created nor delivered any “as built” drawings prior to the formation of the Lien Agreement. Accordingly, they could not have formed part of the general deficiencies listed in paragraph 2.4 of the Lien Agreement.

Further, EBC argues they were never given notice of deficiencies regarding “as built” drawings. [ 20 ] The concrete flooring staining issue was set out in paragraph 2.4(

d) of the Lien Agreement. RCA and EBC’s flooring subcontractor notified the City in September 2018 that the stains were a normal occurrence. EBC believed the matter was resolved, and argues the City failed to raise it within the Claims Process. EBC argues it was not made aware the City had hired someone else to work on the concrete flooring until 2021, when the City delivered its evidence on this application. Position of the City [ 21 ] The City argues EBC was aware prior to execution of the Lien Agreement that the holdback would not be paid to BLG in trust.

Counsel for the City in a September 12, 2018 email to counsel for EBC referred to the holdback funds as the “funds formerly contemplated to be held by BLG.” In an email containing the signed Lien Agreement on September 18, 2018, counsel for EBC noted funds would be paid directly to EBC by the City. [ 22 ] In addition, the City submits that between September 15, 2018 and April 16, 2019, EBC made several requests of the City, not BLG, for payment from the holdback funds.

On April 16, 2019 EBC asked the City to release the remaining holdback funds after the City had only days earlier refused on the basis of outstanding deficiencies. [ 23 ] The City further argues EBC was required to raise the dispute about the holdback funds within the dispute resolution mechanisms of the Contract or the Lien Agreement, neither of which was done. This prevents EBC, the City submits, from bringing the claim within this application. The dispute resolution process was a way the parties agreed to give notice to each other about issues between them.

The City submits EBC cannot circumvent this process by bringing this application. Doing so, they argue, amounts to an abuse of process ( British Columbia (Workers’ Compensation Board) v. British Columbia (Human Rights Tribunal), 2011 SCC 52 , at para. 36 ). [ 24 ] The City also relies on Arbitrator Stephen Morrison’s jurisdictional ruling dated March 22, 2020. Mr. Morrison was asked by the parties to determine the scope of disputes that could be determined in the arbitration process and the documentary evidence that could be relied upon.

He determined that the parties were not prevented by the Lien Agreement from bringing other claims that had not been set out therein. This was in response to EBC’s submission that the Lien Agreement covered all claims between them. Mr.

Morrison also ruled that the arbitration could only address claims that had been advanced prior to September 19, 2018. [ 25 ] In any event, the City argues, the application is barred by the Limitations Act, 2002 because it was brought outside the two- year period (even considering the 183-day suspension because of the pandemic) after the City advised EBC they would not pay the balance of the holdback funds. The City’s position is that EBC ought to have known this by April 16, 2019 at the latest.

Analysis [ 26 ] For the reasons that follow, the applicant’s claim for payment of the holdback funds is dismissed. [ 27 ] I find the non-payment to BLG of the holdback funds is of no moment in deciding this issue. EBC seeks to rely on this non- payment in support of its argument the City was not entitled to simply retain the balance of the holdback funds. While I appreciate the parties did not amend the Lien Agreement to remove the transfer to BLG, the parties were clearly aware of this change and worked with it prior to execution of the Lien Agreement.

Counsel referred to it in correspondence prior to signature of the Lien Agreement. EBC thereafter made demands for payment directly to the City. Clearly the parties were aware the funds would not be paid to BLG, and this issue is of no moment. [ 28 ] This did not change the amount of money the parties agreed would form the holdback fund. This did not stop the parties from

working together regarding various payments to EBC from the holdback funds. In fact, this continued until mid-April 2019 when theCity advised EBC by email there were still unresolved issues that prevented payment of the balance. The parties thereafter continuedwith the Claims Process. [29] At that point the Lien Agreement was over six months old, and Mr. Morrison’s jurisdictional ruling was about a year away. Inote in their submissions on the jurisdictional issues, EBC asked Mr. Morrison to find that all the claims between the parties were subjectto the Claims Process under the Lien Agreement. Mr.

Morrison rejected that position and found the Lien Agreement did not prevent theparties from bringing other claims pursuant to the Contract. [30] Paragraph 8 of the Contract sets out the dispute resolution process and includes notice, negotiation, mediation, and arbitration.There is no dispute in the evidence that EBC did not follow this process regarding the balance of the holdback funds.

Nor did it pursue itin the Claims Process. [31] EBC’s claim that the City only told them the reason why they retained the balance when it was too late for them to pursueoptions other than this Application is not determinative of this issue. The point is that as of April 16, 2019 EBC was aware the City didnot intend to make any further payments from the holdback fund while issues remained unresolved. At that point they could have tried toraise it within the Claims Process, though it would likely have been too late given the September 19, 2018 deadline.

Indeed, Mr.Morrison concluded in his jurisdictional ruling that he could only consider matters which had been raised on or before that date. [32] His jurisdictional ruling was also clear, however, that claims not within the Claims Process could be brought by the partiesunder the Contract. At that point, again, EBC could have raised the issue of non-payment of the balance of the holdback funds. That iswhere the parties agreed disputes would be raised, subject to the Lien Agreement.

EBC did not need to know the reason why the Citywas not paying the holdback money to engage the dispute resolution mechanism in the Contract. Given it was likely too late to bring itunder the Claims Process, the dispute resolution process under the Contract was the proper forum for the dispute, not an application tothe court. [33] I am not aware of any appeal of the jurisdictional ruling. I find that EBC’s position that the Lien Agreement represents theparties’ attempt to make each other aware of all outstanding issues is an inappropriate collateral attack on the jurisdictional ruling.

EBCseeks to relitigate this issue when it chose not to appeal the jurisdictional ruling. (see Danyluk v. Ainsworth Technologies Inc., 2001 SCC44 , at para. 14). [34] In any event, I also find the application itself was brought outside the two-year limitation period in

section 4 of theLimitations Act, 2002 and is accordingly statute-barred. If EBC believed it was entitled to the balance of the holdback funds, it did notneed to wait, as alleged, for the City’s rationale for non-payment to start a claim. EBC was aware as of April 16, 2019 that approximately$200,000 of the holdback fund was being retained by the City. As a result, EBC had discovered or ought to have discovered its claimagainst the City by that date. The Notice of Application was issued on January 25, 2022, outside the two-year limitation period. Did the City fail to pay to EBC $111,015.68?

Background [35] The applicant refers to these funds as holdback funds; the respondent, as the Contract Credit. For clarity I will refer to them asthe “Contract Credit” given that is what the parties understood it to mean in their Amendment Agreement dated July 24, 2015(hereinafter the “Amendment Agreement”). [36] On the same day they signed the Contract, the parties entered into the Amendment Agreement, which among other things,reduced the Contract price by $110,000 plus all Value Added Taxes (for a total of $111,015.68). The City withheld the Contract Creditfrom the final holdback.

Position of EBC [37] While EBC acknowledges the validity of the Amendment Agreement, it argues the City by its conduct either waived theContract Credit or should be estopped from seeking its enforcement. [38] First, EBC argues that the parties agreed in the Lien Agreement that the Contract Credit had been dealt with and would not befurther applied.

Paragraph 2.2, for example states that “the Parties acknowledge and agree that the uncontested balance currently owingby the City to EBC under the Contract is $562,743.81.” EBC submits that if the City believed the Contract Credit was still valid, itwould have deducted it from the total in paragraph 2.2 of the Lien Agreement.

In short, EBC suggests the City made an accounting errorwhen the Lien Agreement was entered into and is trying to make up for it by retaining the Contract Credit from the final holdback. [39] Second, EBC submits that the City, by its conduct after signing the Lien Agreement, signaled it did not intend to be bound bythe Contract Credit. More than thirty-six applications for payment were submitted by EBC pursuant to the Contract and each of them setout the original price of the Contract. At no point, according to EBC, did the City point out the Contract Credit had been omitted.

Inaddition, EBC suggests, the City did not ask for a Change Order under the Contract. [40] EBC argues the City did not mention the Contract Credit for four years until the City in an email to EBC said they woulddeduct it from the next payment.

This deduction did not take place, which EBC suggests reinforced their understanding the ContractCredit had already been accounted for. [41] Finally, EBC suggests the City failed to bring a formal claim against EBC, in the Claims Process or otherwise, andaccordingly EBC was further led to believe the Contract Credit had been dealt with. [42] EBC submits they relied on the City’s conduct to their detriment. They would have, for example, not given up their power tolien the project if they were not certain about how much remained to be paid to them. They also did not advance a claim for the money in

the Claims Process and by the time the City said they expected the Contract Credit to be honoured, it was too late to form part of the Claims Process. Position of the City [ 43 ] The City submits the Contract defines a Change Order as a written amendment to the Contract signed by the Owner and the Design-Builder. The Amendment Agreement, it is suggested, is therefore by definition a Change Order which reduced the Contract Price accordingly.

The City further submits the Contract Price was a stipulated price which covered both the design and build for the OAG expansion and the OAC redevelopment. [ 44 ] A plain reading of the Lien Agreement, the City argues, shows that it was never the intention of the parties that it would set out all the amounts owing between them.

Paragraphs 1.3 and 2.2 state the Lien Agreement specifically excludes “work under the Contract covered by cash allowances and the Arts Court Repurposing.” The City submits this plain wording demonstrates the parties intended the Lien Agreement to cover the OAG work alone. [ 45 ] The City further submits that when substantial performance of the OAC was reached, the City noticed EBC had been paid the full Contract Price for that work. The City accordingly notified EBC of this oversight and indicated the Contract Credit would be deducted from the next payment to EBC.

There is no dispute this did not come to pass and instead the City waited until the final holdback to deduct the Contract Credit. The City’s evidence on this delay is both that they did not want to put EBC in a difficult financial position regarding payment of their ongoing invoices and that they had not yet received a response to their email regarding withholding the Contract Credit. [ 46 ] Finally, the City argues that with the expiry of the time to lien the OAG project, the City was lawfully permitted to deduct the Contract Credit from funds it released to EBC.

To do otherwise, it is submitted, would have unjustly enriched EBC, who would have received more than the Contract Price. This, the City submits, would have been a commercially absurd result. Analysis [ 47 ] For the reasons that follow, the applicant’s claim for payment of the $111,015.68 is dismissed. [ 48 ] The Contract defines a Change Order at paragraph 2 of the

definitions

section as a “written amendment to the Contract signed by the Owner and the Design-Builder stating their agreement upon”, among other things, “the method of adjustment or the amount of the adjustment in the Contract Price, if any.” A plain reading of the Contract brings me to the conclusion that the Amendment Agreement is a Change Order within the meaning of the Contract. [ 49 ] I also find the Contract was for both the OAG and the OAC and that it was a stipulated price contract. The first page of the Contract clearly sets this out.

Nothing in the record suggests otherwise. [ 50 ] I again respectfully disagree with EBC’s submission that the Lien Agreement was intended to set out all the outstanding payments and obligations between the parties. This is the same argument that was rejected by Mr. Morrison in his jurisdictional ruling. For the reasons already discussed, EBC’s position is an inappropriate collateral attack on the jurisdictional ruling. [ 51 ] In any event, I find the Lien Agreement specifically excludes at paragraphs 1.3 and 2.2 cash allowances and the OAC repurposing from the uncontested balance owing under the Contract.

Although my review of the evidence suggests counsel for the City drafted the Lien Agreement, it is clear from the exchange of emails found at Exhibits 4 and 5 of Andy Smith’s Affidavit sworn June 30, 2022, that both parties negotiated the wording of the agreement. I need look no further than the plain wording and meaning of the Lien Agreement to determine the intentions of the parties on this point. [ 52 ] I also reject EBC’s estoppel argument. One of the cases EBC relies upon in support of this position, Dean Construction Co. v.

MJ Dixon Construction Ltd. , 2011 ONSC 4629 , is distinguishable from the facts on this application. In Dean the parties’ contract limited overhead and profit claims to five percent. Despite this, the owner paid it at fifteen percent on eighty-two Change Orders. The court accepted the builder’s waiver and estoppel argument. In this application, there is a static contract price for both the OAG and the OAC repurposing that was not adjusted for the Contract Credit until later in the project, after EBC had been paid in full for the OAC repurposing.

There is no evidence of an agreement that monies over and above the Contract Price would be paid to EBC. Waiting to confirm the Contract Credit would be deducted from a payment to EBC did not amount to waiver. [ 53 ] In the City’s email they indicated they intended on deducting the Contract Credit from the next invoice.

Kristin Ratcliffe for the City closed that August 07, 2019 email by stating “If you have any questions or wish to discuss, please contact me.” I accept her explanation that having not heard back from EBC on this issue, she chose not to deduct it from ongoing invoices but rather from the final holdback. [ 54 ] I fail to see how EBC could have relied to their detriment on the City’s delay in applying the Contract Credit. Pursuant to the jurisdictional ruling, the parties were free to bring other claims under the Contract outside of the Claims Process in the Lien Agreement.

Further, Kristin Ratcliffe’s email was clear, and she welcomed EBC to contact her about this issue. Her decision not to deduct the Contract Credit from the next invoice payment was not a waiver of that term of the Amendment Agreement. If EBC believed otherwise, she had clearly opened the door for a discussion on the issue, which never happened. [ 55 ] In addition, this was a stipulated price contract, the value of which was reduced by the parties pursuant to a valid Change Order.

It would be a commercially absurd result if first, EBC received more than the value of the contract without any consideration flowing to the City in the absence of a clear waiver, and second, if the City was required to bring a claim against EBC to make sure the Contract Credit was applied. [ 56 ] The City’s decision to deduct the Contract Credit from the final holdback was lawful. The time for the registration of a lien had expired. Under the Construction Lien Act , when liens have expired or otherwise been satisfied or protected by other means, the

owner is permitted to set-off against the holdback outstanding claims or debts (see Man-Shield (Now) Construction Inc. v. Rainy River District School Board , 2012 ONSC 323 , at para. 16 ). That is what the City did in this case. Did the City fail to pay EBC interest owing in the amount of $62,197.45? Position of EBC [ 57 ] EBC argues they are owed interest pursuant to paragraph 5.3.1 of the Contract at the rate of one per cent above the prime lending rate, compounded monthly, with respect to three invoices allegedly paid late.

Interest applies equally, they submit, to the Phase 1 arbitration award as well as the Phase 2 settlement. This is so, they suggest, because paragraph 5.3.1 of the Contract states that interest also applies to “an award by arbitration or court”. EBC agrees the invoices were in dispute; however, it relies on paragraph 5.3.2 which states that interest accrues on disputed items from the date it would have been due and payable until it is paid in full. EBC also seeks interest on the holdback funds and the Contract Credit.

Given I have dismissed these claims I need not address the request for interest on them any further. Position of the City [ 58 ] The City denies any liability for interest as alleged by EBC, for several reasons. First, with respect to the three invoices, the City submits that the invoice for Change Orders 88, 204 and 287 was resolved by way of a settlement which did not include interest. Additionally, the City argues that EBC failed contrary to the Contract to counter-sign change orders regarding monies paid by EBC to RCA.

When a settlement was reached on this claim, which did not include interest, the City issued a Change Order, it was counter- signed by EBC, and paid within two months by the City. Regarding the third invoice for Staircase C, the City argues the invoice was issued before the work was completed and before it could pass inspection under the Building Code and the Fire Code. The City’s position is that they paid the invoice within 18 days of proper completion of the work. [ 59 ] Second, with respect to the Phase 1 award, the City argues Mr. Morrison’s decision did not include costs.

The parties worked closely together for some time to determine the correct amounts owing under this award and in fact agreed it should be reduced by approximately $10,000. The City does not believe they should be penalized with costs for the time they took to work out the correct numbers with EBC. [ 60 ] Finally, the City submits the Phase 2 settlement the parties reached did not contemplate interest.

Analysis [ 61 ] At the outset I note that in contrast to the other matters in dispute, the interest question was only briefly addressed in the evidence and written submissions of the parties, as well as their oral argument. [ 62 ] The interest provisions in the Contract are clear. Paragraph 5.3.1 states that interest applies to payments either party fails to make as they become due under the terms of the contract or pursuant to an award by arbitration or the court, until they are paid in full. [ 63 ] There is no provision in the Contract for interest on settlements reached by the parties.

The uncontested evidence is that the invoice for Change Orders 88, 204 and 287 as well as the Phase 2 settlement represent settlements of disputes between the parties. There is no evidence in the record before me to suggest the parties intended interest to apply to these settlements. I must accordingly dismiss these requests for interest. [ 64 ] The invoice for monies paid by EBC to the Consultant, RCA, is problematic for EBC because it did not originally counter- sign the Change Order as required by the Contract.

Moreover, the parties reached a settlement on this issue, and again, there is no evidence they intended interest to apply to this settlement. This claim for interest is also dismissed. [ 65 ] I accept the City’s evidence that the invoice for Staircase C was issued prior to completion and prior to it being able to pass the inspections for the Building Code and the Fire Code. The invoice was paid promptly after these inspections were completed and accordingly the request for interest on this invoice is dismissed. [ 66 ] Finally, I agree with EBC that interest under the Contract is payable on the Phase 1 award.

The plain wording in the Contract confirms interest is payable on arbitration awards from the time they are made. Mr. Morrison’s Phase 1 decision is silent as to costs and accordingly the interest provisions in the Contract apply. I understand the parties agreed to reduce the Phase 1 award to $84,051.70. The time it took to reach this agreement did not stop the interest clock in the Contract from running.

Interest is therefore payable for the 266 days from the date of the award to the payment of the agreed upon award (August 20, 2020 to May 13, 2021) at the rate of 3.45 per cent for a total of $2,136.95 (as set out in Jocelyn Bernier’s affidavit sworn May 02, 2022 at exhibit 55). This interest is payable within 30 days of the date of this decision. Conclusion [ 67 ] For these reasons, I declare the City owes $2,136.95 in interest on the Phase 1 award to EBC. I order the City to pay this interest within 30 days of this decision.

The balance of the application is dismissed. [ 68 ] If the parties cannot agree on costs, the City may deliver costs submissions of no more than two pages, double-spaced, not including any offers to settle and bill of costs within fifteen days of this decision. EBC may deliver costs submissions with the same restrictions within fifteen days of receipt of the City’s submissions. There will be no reply. Late submissions will not be considered. [ 69 ] I would like to thank counsel for their able assistance, and in guiding me, with their cogent arguments, through the voluminous electronic record.

____________________________________ The Honourable Mr. Justice P.J. Boucher Released: January 30, 2023 CITATION : EBC v. City of Ottawa, 2023 ONSC 671 OTTAWA COURT FILE NO.: 22-88431 DATE: 2023-01-30 ONTARIO SUPERIOR COURT OF JUSTICE BETWEEN: EBC Inc. Applicant – and – City of Ottawa Respondent DECISION ON APPLICATION Boucher, J. Released: January 30, 2023