Canadian Trade International Inc. v. Klein, 2015 SKQB 45

• Judge: Zuk, J.
• Court: Court of Queen's Bench of Saskatchewan (Canada)
• Case Date: February 11, 2015
• Jurisdiction: Saskatchewan
• Citations: 2015 SKQB 45;(2015), 469 Sask.R. 289 (QB)

Cdn. Trade Intl. Inc. v. Klein (2015), 469 Sask.R. 289 (QB)

MLB headnote and full text

Temp. Cite: [2015] Sask.R. TBEd. MR.023

Canadian Trade International, Inc. (plaintiff) v. Randall Todd Klein and Paula Jean Klein (defendants)

(2014 QB No. 1514; 2015 SKQB 45)

Indexed As: Canadian Trade International Inc. v. Klein

Saskatchewan Court of Queen's Bench

Judicial Centre of Saskatoon

Zuk, J.

February 11, 2015.

Summary:

The Kleins entered into a construction agreement with Canadian Trade International Inc. (CTI), which obligated CTI to construct a luxury home for the Kleins. The contract was terminated. CTI registered a claim of lien against the Kleins' property. The amount of the lien was $225,413.40. The Kleins applied for, inter alia, an order pursuant to s. 60 of the Builders' Lien Act vacating the claim of lien or, in the alternative, an order pursuant to s. 57(2) of the Act that the Kleins' post security for the lien in the amount of $20,000, or an amount in the discretion of the court, for the registered lien to be vacated.

The Saskatchewan Court of Queen's Bench dismissed the Kleins' application pursuant to s. 60 of the Act with leave to pursue the application at trial. With respect to whether the Kleins were entitled to an order pursuant to s. 57(2), CTI's lien exceeded the holdback amount and the court was not prepared to vacate CTI's lien by directing the Kleins to simply pay the holdback amount into court. In a situation such as this, the appropriate procedure was an application pursuant to s. 56(2) of the Act. It was not plain and obvious that CTI's claim, or the quantum thereof, was without merit. Therefore, the court had to consider the lien to be a valid lienable claim for the purposes of s. 56(2). Since CTI had established its claim of lien with sufficient particularity to meet the plain and obvious test, the court directed that CTI's lien be discharged upon payment into court of $225,413.40 plus $50,000 as security for costs, or posting of security in a like amount.

Mechanics' Liens - Topic 5055

Obtaining a lien - Vacating registered lien - Grounds for - [See Mechanics' Liens - Topic 8803 ].

Mechanics' Liens - Topic 6941

Loss or discharge of lien - Discharge by payment into court - General - [See Mechanics' Liens - Topic 8803 ].

Mechanics' Liens - Topic 7004

Loss or discharge of lien - Order vacating lien - Entitlement - General principles - [See Mechanics' Liens - Topic 8803 ].

Mechanics' Liens - Topic 7009

Loss or discharge of lien - Order vacating lien - Security - When required - [See Mechanics' Liens - Topic 8803 ].

Mechanics' Liens - Topic 8803

Costs - Security for costs - The Kleins entered into a construction agreement with Canadian Trade International Inc. (CTI), which obligated CTI to construct a luxury home for the Kleins - The contract was terminated - CTI registered a claim of lien against the Kleins' property - The amount of the lien was $225,413.40 - The Kleins applied for, inter alia, an order pursuant to s. 60 of the Builders' Lien Act vacating the claim of lien - The Kleins submitted that the lien was exaggerated and/or contained fraudulent invoicing - In the alternative, the Kliens sought an order pursuant to s. 57(2) of the Act that the Kleins' post security for the lien in the amount of $20,000, or an amount in the discretion of the court, for the registered lien to be vacated - The Saskatchewan Court of Queen's Bench dismissed the Kleins' application pursuant to s. 60 of the Act with leave to pursue the application at trial - CTI had sufficiently challenged or explained away the Kleins' allegations thereby establishing that the lien was not, on the face of it, grossly exaggerated, grossly inaccurate, obviously spurious, or otherwise incapable of being supported in law - With respect to whether the Kleins were entitled to an order pursuant to s. 57(2), CTI's lien exceeded the holdback amount and the court was not prepared to vacate CTI's lien by directing the Kleins to simply pay the holdback amount into court - In a situation such as this, the appropriate procedure was an application pursuant to s. 56(2) of the Act - It was not plain and obvious that CTI's claim, or the quantum thereof, was without merit - Therefore, the court had to consider the lien to be a valid lienable claim for the purposes of s. 56(2) - The court directed that CTI's lien be discharged upon payment into court of $225,413.40 plus $50,000 as security for costs, or posting of security in a like amount - See paragraphs 30 to 58.

Cases Noticed:

SaskCon Repair Services Ltd. v. Frontier Sandblasting & Painting et al. (2008), 321 Sask.R. 5; 2008 SKQB 299, consd. [para. 30].

H & S Holdings Inc. v. Noon (2011), 376 Sask.R. 228; 2011 SKQB 217, consd. [para. 33].

Rosewood Land Inc. v. Premier Mechanical & Electrical Ltd., [2014] Sask.R. TBEd. NO.026; 2014 SKQB 355, dist. [para. 34].

Evolution Homes Ltd. v. Zupanich (2014), 437 Sask.R. 113; 2014 SKQB 38, consd. [para. 34].

Town-N-Country Plumbing & Heating (1985) Ltd. et al. v. Schmidt et al. (1991), 93 Sask.R. 278; 4 W.A.C. 278 (C.A.), refd to. [para. 34].

RegWin Hotel Ltd. v. Quorex Construction Ltd. (2008), 326 Sask.R. 315; 2008 SKQB 421, refd to. [para. 34].

Cornerstone Developments Inc. v. Sawtooth Custom Homes Inc. (2011), 379 Sask.R. 297; 2011 SKQB 223, revd. (2011), 385 Sask.R. 28; 536 W.A.C. 28; 2011 SKCA 105, refd to. [para. 44].

Majestic Contractors Ltd. v. N.C.L. Contracting Ltd. et al., [1994] 2 W.W.R. 619; 117 Sask.R. 12 (Q.B.), consd. [para. 50].

Statutes Noticed:

Builders' Lien Act, S.S. 1984-85-86, c. B-7.1, sect. 22(1) [para. 47]; sect. 34 [para. 43]; sect. 56 [para. 49]; sect. 57 [para. 41]; sect. 60 [para. 31].

Counsel:

A.R. Touet, for the plaintiff;

G.A. Meschishnick, Q.C., for the defendants.

This application was heard before Zuk, J., of the Saskatchewan Court of Queen's Bench, Judicial Centre of Saskatoon, who delivered the following fiat on February 11, 2015.