Pearls of Wisdom from the Bench

On April 29, 2021, Justice Sutherland, Master Wiebe, and Master Robinson shared pearls of wisdom with the Ontario Construction Bar during the webcast “An Evening with the Bench”, hosted by the Ontario Bar Association. This year’s rendition of the annual event covered the practice of construction law during the COVID-19 pandemic, motions in writing, References, virtual hearings, the effect of 2020 Suspension of Limitation Periods, issues under the Construction Act, expert witnesses, and important decisions.

We thank Justice Sutherland, Master Wiebe, and Master Robinson for volunteering their time to share their helpful insights with the Bar.

General Practice Tips

Justice Sutherland, Master Wiebe, and Master Robinson offered a number of general practice tips based on their experiences on the Bench during the COVID-19 pandemic.

First and foremost, counsel must read and follow the Practice Directions issued by the Court. Treat the Practice Directions as if they were the Rules of Civil Procedure. Following the Practice Directions will make the Bench’s job easier and will help to ensure you are being the most effective advocate for your client.

The Bench candidly noted that the quality of written submissions has declined “dramatically” in the past year. They advised attendees to edit materials thoroughly and ensure everything is included before submitting.

It is also critical that counsel only file materials once. Filing materials multiple times or in multiple ways can result in more than one Judge or Master receiving your materials. This can, and has, resulted in conflicting decisions.

Motions in Writing

For motions in writing, counsel must take care to ensure all materials are included. Since counsel will not get an opportunity to appear before the Bench, it is key to anticipate questions from the Bench and address them in the written materials.

Justice Sutherland, Master Wiebe, and Master Robinson stressed that counsel must know and lead evidence with respect to the legal test for the relief they are seeking. This includes being conscious of leave requirements in the Construction Act, where applicable.

The Bench reminded counsel to ensure all materials are bookmarked and hyperlinked. This will assist the Judge or Master with accessing the materials quickly and easily. If the written materials reference a pleading or previous Order, include it. Do not assume that the Judge or Master has the entire file at their fingertips, even the documents that have been filed at the courthouse.

For motions to vacate a lien by posting security under section 44 of the Construction Act, counsel should provide proof of the date of the relevant contract if the matter is governed by the Construction Act as it read before July 1, 2018 if they are seeking to post less security. The front page, signature page, and page showing the date of the contract is often sufficient, and counsel should avoid submitting lengthy contracts in full to the Master.   

References

With respect to References, Master Wiebe and Master Robinson are doing everything possible to ensure that matters proceed swiftly toward trial. This is particularly true for smaller lien matters. Master Wiebe and Master Robinson endeavor to make Orders, even before counsel appear before the Master, to advance the matter to trial. In some cases, the trial will occur at what would have been the first pre-trial conference.

Counsel should include their availability with their materials for the Order for Trial. The Bench will not be sympathetic toward counsel asking for adjournments if they did not include their availability with the materials.

Virtual Hearings

Due to the ongoing COVID-19 pandemic, many matters are currently being heard by way of virtual hearing. This is expected to continue even when the pandemic is over. As such, it is crucial for counsel to familiarize themselves with the relevant technology. Master Wiebe, Master Robinson and Justice Sutherland provided some useful tips for virtual hearings, which are discussed below.

With the advent of virtual hearings, there are fewer opportunities for counsel to meet informally as they would if a matter were being heard in a courtroom. One suggestion was for counsel to take initiative to arrange a time to confer before a hearing, to narrow the issues and/or discuss the possibility of settlement.

During virtual hearings, it is important to remember that you are still in court. The same etiquette should be maintained as if you were physically before a Judge or Master. This includes refraining from the same things you would refrain from in court, such as eating and drinking beverages other than water. Even if counsel is not required to gown, proper business attire should be worn. Remain civil; do not argue or debate with opposing counsel. Do not talk to your off-screen colleagues or others in the room. Essentially, refrain from doing anything that could be distracting to the Judge or Master on the other side of your screen.

In addition to the same general considerations that apply to an in-person hearing, there are also unique considerations for virtual hearings that counsel should keep in mind. Be mindful of the positioning of your camera. In other words, think about what those on the other side of your camera are seeing. Maintain confidentiality, especially when working from home. A Judge or Master may ask you and/or your witness to move your camera around the room you are in, to make sure that no one is in the room who should not be. Master Wiebe recommends that witnesses attend virtual hearings from their lawyer’s office, so that the lawyer can monitor the witness to ensure there is no interference during their testimony.

Be mindful of body language, your own and others. If you prefer to give submissions while standing, feel free to stand. However, do not pace in and out of the view of your camera. Generally, ensure you are comfortable, but not too comfortable. As Master Robinson put it, “A touch of discomfort made me a better advocate.” Use appropriate posture. If you are sitting down, sit up straight and do not slump in your chair. Remain alert. Be aware if a witness starts looking at a document when you have not shared any documents on the screen. If you have a second (or third) screen, make sure it is not behind you, so that you are not turning back to look at it. This is distracting and may cause sound issues.

As with all hearings, counsel should ensure they are adequately prepared. In the case of a virtual hearing, more planning may be required. Counsel should be prepared to quickly show documents using the screen sharing function of the program they are using. It is important for counsel to be as comfortable with their electronic materials as the would be with physical materials. Make sure you are giving page references so that they are accessible to the court and other parties. For example, if using CaseLines, use the CaseLines reference for materials. If you are using PDF, use the PDF page numbers (which may be different from the page numbers on the document itself). Use virtual bookmarks and hyperlinks where appropriate. If you do not appropriately reference pages, a Judge or Master may interrupt you during your submissions or cross-examinations.

The pandemic has been an interesting time for junior lawyers who are just starting to get oral advocacy experience. There are both pros and cons to starting out as a lawyer in a virtual world. One advantage is that, when giving submissions, juniors can basically read their arguments from their notes verbatim, by splitting their screen between the virtual hearing and their notes. One potential disadvantage is that there is no natural debrief with senior counsel on the walk back to the office from the courthouse. To ensure juniors are being properly trained, time should be set aside after hearings to virtually debrief and discuss.

Moving forwards, the Bar can expect directions from each jurisdiction on what to expect at virtual hearings. In the meantime, counsel are encouraged to agree to a preliminary set of questions to be put to witnesses, such as “Are you alone?”, “Do you have any documents in front of you?” and “What applications do you have open on your computer?” Some Judges or Masters may develop their own preliminary questions to help set the ground rules of the hearing or trial. For example, Master Wiebe holds a Protocol Trial Management Conference before virtual trials, to deal with practical and procedural issues for the trial before the trial commences.

Question and Answer Period

During a question-and-answer period at the end of the event, counsel were given the opportunity to ask Master Wiebe, Master Robinson and Justice Sutherland questions.

Effect of 2020 Suspension of Limitation Periods

Several of the questions pertained to Ontario Regulation 73/20, which temporarily suspended limitation periods in 2020 in response to the COVID-19 pandemic, and its effect on the lien preservation and perfection deadlines under the Construction Act.^[1] Under O. Reg. 73/20, limitation periods in civil matters were suspended from March 16, 2020 to September 13, 2020 inclusively, except those under the Construction Act. Limitation periods under the Construction Act were suspended on March 16, 2020, but O. Reg 73/20 was amended so that the suspension was lifted as of April 16, 2020.^[2] This was a period of uncertainty for the construction bar, particularly regarding the effect of the suspension on the lien timelines under the Construction Act.

During the event, a question was asked about whether Judges and Masters would demonstrate some leniency with respect to missed timelines for preserving and perfecting liens under the Act as a result of the uncertainty caused by COVID-19 and O. Reg. 73/20. The answer was a clear no – there is an abundance of case law that failure to meet the lien timelines is generally fatal to the lien claim (absent the existence of another validly perfected lien under which the lien can shelter). While the strict timelines under the Construction Act cannot be extended, even in extraordinary circumstances, an expired lien claim may be allowed to continue as a breach of contract and quantum meruit claim.

Various Lien Deadlines under the “New” Act

It is common for counsel to ask questions about issues that affect lien timing under the “new” Construction Act at the end of this event, and this year was no exception.

One interesting question raised by an attendee related to section 31(6) of the Construction Act, and the requirement for a notice of termination of contract to be published by the terminating party in a construction trade newspaper. Master Wiebe predicts that “zero” owners will do this and wondered how this will play out in practice, given the relationship between publication of the notice of termination and lien deadlines.

Another useful tip provided by the Bench was that if a party is close to the two-year deadline in section 37 of the Construction Act, they may pass a trial record and then move for a judgment of reference (even in Toronto), thus helping to ensure that the action is not dismissed for not having been set down for trial within two years.

Expert Witnesses

An attendee asked the Bench how counsel can make the best use of expert witness testimony. The Bench provided the following tips with respect to expert witness testimony.

First, consider whether you need an expert. If you do, clearly define the scope of the expert’s opinion and which area they should be qualified in. Counsel should consider putting into evidence the instructional letter given to the expert, along with the expert report itself.  Remember that experts must be impartial and must only give opinion evidence (not fact evidence). Counsel must tender and prove the facts that experts rely on through the evidence of fact witnesses. Another helpful tip was that experts who see the weaknesses of their client’s case are viewed as more credible by some members of the Bench. Always remember that an expert’s purpose is to provide opinions that will assist the court. They should not make conclusions, as the trier of fact is the ultimate decision maker.

Notable Cases

Finally, there was a discussion of notable decisions that have been released since last year’s Evening with the Bench event.

First, the Bench discussed R&V Construction v. Baradaran.^[3] This decision was the culmination of years of litigation, and has widespread implications concerning the powers of a referee under the Construction Act, procedural fairness and lawyer’s obligations when acting against self-represented litigants. In 2016, the owner moved under section 47 of the Construction Act for an Order “discharging [the Contractor’s] lien and dismissing the action, or in the alternative, an order reducing lien security.” This was the only motion before the Master. At the hearing, the Master characterized the motion as a motion for summary judgment and found that she had jurisdiction to use the so-called enhanced powers granted to judges on such a motion under Rule 20.04(2.1) of the Rules of Civil Procedure. The Master granted judgment in favour of the contractor, R&V Construction Management Inc., and found that there were no genuine issues for trial.

The owner moved to oppose the Master’s Report and the Superior Court held that the Master had exceeded her jurisdiction by employing the enhanced powers. The contractor appealed this decision to the Divisional Court. The Divisional Court dismissed the appeal but disagreed with the motion judge’s findings in respect of the powers available to a Master on reference under the Construction Act. To summarize, the Divisional Court noted that section 67 of the Construction Act makes clear that a construction lien referee’s jurisdiction is not limited to “summary trials” but includes appropriate interlocutory proceedings. The Construction Act requires a summary process, not a summary trial. While summary trials may be a “good solution” in some cases, in others, disposition without a trial, such as by summary judgment, may be the more “summary”, and thus appropriate, solution. Indeed, section 67 of the Construction Act accords a Master the power to consent to a summary judgment motion being brought under Rule 20 where such disposition without trial “would expedite the resolution of the issues in dispute”. If the Master who gives such consent is a referee, the Master on reference has the powers given to him or her under section 58 of the Construction Act, which includes the Enhanced Powers. On the other hand, if the Master who consents to hearing a motion for summary judgment is not a referee, then the Master’s powers are limited to those given to him or her under the Rules of Civil Procedure.

The Divisional Court held that motions Judge erred in holding that the Master, as a Master on reference, did not have jurisdiction to use the enhanced powers on a motion for summary judgment. Nevertheless, the Divisional Court held that the Master had denied the self-represented owner procedural fairness in granting judgment to the contractor.

The Divisional Court found that the Master incorrectly described the motion as a motion for summary judgment. A motion under section 47 of the Act is not a motion for summary judgment. It is always a defensive motion and “does not provide a means for the plaintiff to move for judgment.” As such, the contractor’s response to the owner’s motion did not put the owner on notice that judgment could be granted against him, thus denying him procedural fairness when judgment was, in fact, granted against him. Indeed, the contractor was clear in stating its position that it was only seeking a trial, not judgment.  In sum, the Divisional Court affirmed on the matter of general interest that a Master on reference may use the enhanced powers in disposing of a summary judgment motion. However, the Divisional Court dismissed the contractor’s appeal on the basis that summary judgment had been granted without a motion by the contractor and with the owner having been deprived of procedural fairness on the unique facts of this case. The Court accordingly remanded the case back to another construction lien Master to proceed on its merits.

Second, Prasher Steel Ltd v. Maystar General Contractors was discussed, which was an appeal from a Master on a judgment granted on a motion to enforce a settlement under Rule 49 for summary judgment under Rule 20.^[4] The takeaway from the decision is that any time a Master makes a factual finding in the context of a reference, the Master must issue a Master’s Report, which is then subject to confirmation in the Superior Court, pursuant to the Rules of Civil Procedure. The Master’s Report determines the routes by which the Master’s decision may be reviewed and appealed. Because no Report was issued by the motions Master in this case, the case was remitted back to the Master to issue a Report in accordance with his findings on the motion, despite that fact that this would lead to delay and expense for the parties, because it is an important practice point for construction lien cases and the issuance of a Report affects the appropriate appeal routes.

Conclusion

An Evening with the Bench is always a highly anticipated and well-attended event. It is the one night a year where the construction bar can ask the Bench their questions directly. Traditionally, it is also a night where the construction Bar in Toronto and the surrounding areas gathers to mingle over dinner. This year may have looked a bit different, since the event had to take place virtually. However, there was no shortage of connection or valuable insight. In fact, it was easier than ever for construction lawyers outside of Toronto to join their colleagues and the Bench.