Legal Blog

Extra Labour Cost – Excessive Lien

McLarty v. 2210961 Ontario Limited 2020 Ont SCJ

A contractor charged extra labour based on a “shop rate” of $60 an hour (a rate that it applied to all customers) rather than the actual rate plus burden. The judge held that the rate was standard in the industry and that, because the contractor included in his quote, an estimate for labour at the same rate, he had a right to that rate. The court analogized the claim to an auto repair shop charging the same rate to every customer, regardless of the wage cost of the individual actually performing the work. Using the same logic, the court held that the plaintiff was not allowed to claim an enhanced rate for overtime work. The amount awarded was $124,000 but the lien claim was $203,000. The judge concluded that the lien claim was exaggerated. However, because the defendant filed no evidence to prove it suffered damages, the judge gave nothing as compensation.

Written by Jonathan Speigel, the founding partner of Speigel Nichols Fox LLP, leads the litigation and construction practices.