Is an owner entitled to look behind a bid submitted in response to an invitation to tender and determine whether it is compliant with the terms of the invitation to tender, even though on its face the bid is compliant? And if the owner does so, and determines that the bid is non-compliant, can the [...]

An agreement to mediate is often found in arbitration and building contracts. Yet, the impact of mediation upon court or arbitral proceedings is uncertain. Does an agreement to mediate mean that, until the mediation occurs, there is no cause of action and therefore there is no entitlement to commence arbitration or an action?  In that [...]

A building contract usually includes a term requiring that the work or materials supplied adhere to the specifications. The contract may also contain implied or express warranties that the work will be fit for the intended purposes of the building project and free of defects. What happens when those terms result in inconsistent results? What [...]

The Ontario Superior Court recently decided two important issues relating to construction liens. In Wellington Plumbing & Heating Ltd. v. Villa Nicolini Incorporated, the court held that a late-issued pro forma architect’s certificate was invalid, and that GST must be added to a holdback. Factual Background Villa Nicolini constructed a retirement home in Vaughan. The [...]

The Supreme Court of Canada has recently refused leave to appeal in Trevor Nicholas Construction Co. Ltd. v. Canada. In doing so, it has upheld the decisions of the Federal Court Trial Division and Federal Court of Appeal which declined to permit a bidder to rely on after-the-fact information to overturn an invitation to tender.  [...]

What are the limits of the trust fund liabilities under the Construction Lien Act? Those liabilities do not just apply to a contractor or subcontractor engaged in a building project.  Those liabilities may also apply to an officer or director or a person controlling the company. But can an officer, director or controlling person be [...]

Bonds and other forms of guarantees and indemnities are commonly used on construction projects. If a contractor applies for a performance bond, the bonding company will require the contractor to indemnify the bonding company. The bonding company may also require the principal shareholder of the contractor to guarantee the contractor’s obligation and to directly indemnify [...]

Is a party to a contract obligated to mitigate its damages at the same time that it is asking the court to order specific performance? Since the party wants the contract performed, not damages for non-performance, the obligation to mitigate seems to be totally inapplicable. Yet, in Southcott Estates Inc. v. Toronto Catholic District School [...]

The recent decision of the Australia High Court in Andrews v. Australia and New Zealand Banking Group Ltd. is important for the building industry.  While it dealt with a banking contract, the principles it applied are directly relevant to building contracts.  The central decision in Andrews v. ANZ is that the doctrine prohibiting contractual penalties [...]