1642190 Alberta Ltd. et al. v. Paragon Industries Ltd., 2014 MBQB 35

• Judge: Bryk, J.
• Court: Court of Queen's Bench of Manitoba (Canada)
• Case Date: February 06, 2014
• Jurisdiction: Manitoba
• Citations: 2014 MBQB 35;(2014), 301 Man.R.(2d) 287 (QB)

1642190 Alta. v. Paragon Ind. (2014), 301 Man.R.(2d) 287 (QB)

MLB headnote and full text

Temp. Cite: [2014] Man.R.(2d) TBEd. FE.030

1642190 Alberta Ltd., on behalf of Venexo Properties Limited Partnership and 1602598 Alberta Ltd. o/a "The Pint Winnipeg", Oil City Hospitality Group Inc. and Mark Fitton (applicants) v. Paragon Industries Ltd. (respondent)

(CI 13-01-82506; 2014 MBQB 35)

Indexed As: 1642190 Alberta Ltd. et al. v. Paragon Industries Ltd.

Manitoba Court of Queen's Bench

Winnipeg Centre

Bryk, J.

February 6, 2014.

Summary:

Fitton, president of the applicant Oil City Hospitality Group Inc., requested a quote from Paragon Industries Ltd. for interior demolition work on a property. Collins, an estimator and job foreman at Paragon, provided an estimate of $36,500. When the work was not completed as expected, Fitton advised Paragon to cease work and made a payment of $23,000. Paragon demanded additional funds. Fitton negotiated a settlement with Collins, who accepted a further $8,000 in exchange for a release signed by Collins. The release described Collins as Project Manager and provided that Collins had authority to bind the corporation. The next day, Paragon's president returned the release and cheque, stating that Paragon was not bound by the settlement signed by Collins. Paragon maintained that $48,969.29 was still owed for its work on the property. It filed a lien against the property in that amount. Fitton, for the applicants, applied under s. 55(3) of the Builders' Lien Act to vacate the lien.

The Manitoba Court of Queen's Bench dismissed the application.

Agency - Topic 1410

Authority of agent - Apparent authority - Holding out by corporation - What constitutes - [See Mechanics' Liens - Topic 5055 ].

Mechanics' Liens - Topic 5055

Obtaining a lien - Vacating registered lien - Grounds for - Fitton, president of the applicant Oil City Hospitality Group Inc., requested a quote from Paragon Industries Ltd. for interior demolition work on a property - Collins, an estimator and job foreman at Paragon, provided an estimate of $36,500 - When the work was not completed as expected, Fitton advised Paragon to cease work and made a payment of $23,000 - Paragon demanded additional funds - Fitton negotiated a settlement with Collins, who accepted a further $8,000 in exchange for a release signed by Collins - The release described Collins as Project Manager and provided that Collins had authority to bind the corporation - The next day, Paragon's president returned the release and cheque, stating that Paragon was not bound by the settlement signed by Collins - Paragon maintained that $48,969.29 was still owed for its work on the property - It filed a lien against the property in that amount - Fitton, for the applicants, applied under s. 55(3) of the Builders' Lien Act to vacate the lien, asserting that Collins had either actual or apparent authority to negotiate a settlement and sign the release - The Manitoba Court of Queen's Bench dismissed the application - The applicants had not proven that Paragon made any representation to them that Collins had authority to negotiate a settlement and sign a release - There was no evidence that Collins was held out as anything more than an employee with very specific responsibilities - While Collins had signed the release, the court also had to take into consideration Paragon's immediate response - Even if the evidence had been more comprehensive, a contested matter such as this with disputed facts should be determined at trial and not on a s. 55(3) application - The validity of the settlement and release went to the heart of the matter - See paragraphs 61 to 76.

Mechanics' Liens - Topic 5057

Obtaining a lien - Vacating registered lien - Bars - [See Mechanics' Liens - Topic 5055 ].

Mechanics' Liens - Topic 7004

Loss or discharge of lien - Order vacating lien - Entitlement - General principles - [See Mechanics' Liens - Topic 5055 ].

Cases Noticed:

Freeman & Lockyer v. Buckhurst Park Properties (Mangal) Ltd., [1964] 2 Q.B. 480 (C.A.), refd to. [para. 30].

Hely-Hutchinson v. Brayhead Ltd., [1968] 1 Q.B. 549 (C.A.), refd to. [para. 32].

Rockland Industries Inc. v. Amerada Minerals Corp. of Canada Ltd., [1980] 2 S.C.R. 2; 31 N.R. 393; 21 A.R. 79, refd to. [para. 41].

2438667 Manitoba Ltd. et al. v. Husky Oil Ltd. et al. (2005), 39 B.L.R.(4th) 199 (Q.B.), refd to. [para. 52].

Aurora Quarrying Ltd. v. Lynngold Resources Inc. et al. (1992), 82 Man.R.(2d) 113 (Q.B.), refd to. [para. 59].

Authors and Works Noticed:

Harvey, Cameron, Agency Law Primer (3rd Ed. 2003), pp. 67 [para. 53]; 88 [para. 50].

Counsel:

Jonathan M. Woolley and Meghan C. Ross, for the applicants;

R. Grenville Waugh, for the respondent.

This application was heard by Bryk, J., of the Manitoba Court of Queen's Bench, Winnipeg Centre, who delivered the following judgment on February 6, 2014.