Date Issued: March 9, 2018

File: SC-2017-002851 and SC-2017-006282

Type: Small Claims

Civil Resolution Tribunal

Indexed as: H.Y. Engineering Ltd. v. Aziza, 2018 BCCRT 72

 

Between:

H.Y. Engineering Ltd.

Applicant

And:

Osman Aziza

Respondent

And:

H.Y. Engineering Ltd.

Respondent By CounTerclaim

 

 

REASONS FOR DECISION
Tribunal Member:	Kate Campbell

INTRODUCTION

1.         The applicant, H.Y. Engineering Ltd. (HYE), was hired to provide civil engineering services for the respondent Dr. Aziza’s townhouse development project. HYE says Dr. Aziza failed to pay $2,832.82 for work performed.

2.         Dr. Aziza says he does not owe HYE $2,832.82 because they overbilled or did not perform the work. Dr. Aziza has also filed a counterclaim, seeking the return of a $4,000 retainer paid to HYE in November 2016.

3.         HYE is self-represented. Dr. Aziza is represented by Russell McDonough, a lawyer.

JURISDICTION AND PROCEDURE

4.         These are the formal written reasons of the tribunal. The tribunal has jurisdiction over small claims brought under section 3.1 of the Civil Resolution Tribunal Act (Act). The tribunal’s mandate is to provide dispute resolution services accessibly, quickly, economically, informally, and flexibly. In resolving disputes, the tribunal must apply principles of law and fairness, and recognize any relationships between parties to a dispute that will likely continue after the dispute resolution process has ended.

5.         The tribunal has discretion to decide the format of the hearing, including by writing, telephone, videoconferencing, email, or a combination of these. I decided to hear this dispute through written submissions because I find that there are no significant issues of credibility or other reasons that might require an oral hearing. Neither party requested an oral hearing.

6.         The tribunal may accept as evidence information that it considers relevant, necessary and appropriate, whether or not the information would be admissible in a court of law. The tribunal may also ask questions of the parties and witnesses and inform itself in any other way it considers appropriate.

7.         Under tribunal rule 121, in resolving this dispute the tribunal may: order a party to do or stop doing something, order a party to pay money, or order any other terms or conditions the tribunal considers appropriate.

ISSUES

8.         The issues in this dispute are as follows:

a.      Is Dr. Aziza required to pay HYE $2,832.82 for engineering services?

b.      Is HYE required to return Dr. Aziza’s $4,000 retainer?

BACKGROUND

9.         On December 9, 2015, Dr. Aziza and HYE signed an agreement which said HYE would provide engineering and civil design services for the townhouse project. The agreement set out the scope of work to be performed, and listed specific hourly rates for each type of engineering service.

10.      HYE performed work for Dr. Aziza in December 2015 and January 2016. There were some payment delays, and invoices show that in early September 2016, Dr. Aziza owed HYE $517.13 for work performed in January 2016.

11.      On September 12, 2016, Dr. Aziza’s architect, acting on Dr. Aziza’s behalf, emailed HYE with instructions to perform additional work. HYE was asked to update their civil drawings as soon as possible, based on “significant revisions” to the design of the buildings and the site plan. Dr. Aziza’s business agent Mr. Syed was copied on the correspondence, and on most of the subsequent emails.

12.      HYE emailed Mr. Syed on September 13, 2016, asking him to be aware that the revision work would be billed at their hourly rates.

13.      Email correspondence shows that in October 2016, HYE engaged in discussions with the architect and an arborist about where to locate services such as sewer pipes without having to remove trees on neighbouring lots. In an October 12, 2016 email to the architect, HYE said the revised architectural site plan would require more costly servicing and asked for directions on how to proceed. On October 18, 2016, the architect emailed HYE with another revised site plan. He instructed HYE to proceed with revisions “per this latest site plan”.

14.      On October 26, 2016, HYE emailed Dr. Aziza and Mr. Syed, saying they were reluctant to proceed with additional work because of the overdue account. HYE said that to move forward they required a retainer of $4,517.13. The email said that after payment of the January 2016 invoice for $517.13, the $4000 balance would be retained throughout the progress of the project and would be applied to the last invoices payable. The email said the $4000 retainer would not be used as a credit or as advance payment on the first invoice or monthly progress invoices.

15.      Dr. Aziza paid HYE the requested $4,517.13 on November 3, 2016. HYE performed further work, and provided a revised preliminary site grading plan and preliminary servicing plan.

16.      HYE provided two further invoices for additional work performed: an October 31, 2016 for $3,554.72, and a November 30, 2016 invoice for $3,278.10.

17.      A January 24, 2017 billing statement from HYE said Dr. Aziza owed $2,832.82. This was comprised of the October 31, 2016 and November 30, 2016 invoice amounts, minus the $4000 retainer. HYE seeks an order that Dr. Aziza pay the $2,832.82.

REASONS AND ANALYSIS

18.      In a civil claim such as this, the applicant HYE bears the burden of proof, on a balance of probabilities. For the counterclaim, Dr. Aziza bears the burden of proof on a balance of probabilities. I have only addressed the evidence and arguments to the extent necessary to explain my decision.

HYE’s Claim for $2,832.82

19.      Dr. Aziza disputes the October 31, 2016 invoice. He says HYE charged fees in excess of the original agreement without explanation, and the invoice does not justify the amount claimed. He says HYE is either billing for the same work twice, or is billing for work not performed.

20.      I do not agree with this submission. Dr. Aziza did not provide any details about the alleged duplicate work or incomplete work. Also, the December 2015 agreement between the parties specifies that work would be billed at an hourly rate, and while it contained an estimate for preliminary design services, it does not indicate any cap on fees. Finally, after receiving the new site plan on September 12, 2016, HYE reminded Mr. Syed that the revision work would be billed at their hourly rates.

21.      Email correspondence provided by HYE shows that their engineer was working on the project in October 2016. HYE says the revised architectural site plan provided by the architect in September 2016 was completely different from the versions provided in December 2015 and January 2016, so everything they previously designed had to be redone. They also say the work was challenging. Dr. Aziza has not refuted these assertions, which I accept based on the documents provided in evidence. Dr. Aziza has not provided contrary evidence showing that HYE did not perform the work set out in the October 31, 2016 invoice.

22.      However, in a March 10, 2017 email to the architect, the HYE engineer wrote that the October 2016 invoice included some costs for “liaison/coordination” from February 2016 to August 2016 which HYE had not invoiced previously.

23.      The December 9, 2015 agreement signed by both parties says in paragraph IX that progress invoices for works completed in full or in part for previous months services will be issued on or about the 7^th day of the month. Therefore, I find HYE was not entitled to bill for work from February to August 2016 in October 2016.

24.      Although this issue was raised by Dr. Aziza in the tribunal process, HYE has not provided specific evidence about how much of the October 2016 invoice amount relates to work from February to August 2016. This previous work is not mentioned on the invoice itself, which does not include the dates that work was performed and does not show how many hours were worked.

25.      HYE says that under the terms set out in paragraph IX of the December 9, 2015 agreement, Dr. Aziza was obliged to raise any concerns about their invoice within 30 days of receiving it. While I agree that the December 9, 2015 agreement applies, I find that HYE cannot rely on this provision since the October 2016 invoice does not mention any work from February to August 2016, and they did not inform Dr. Aziza about that aspect of the bill until March 2017, after the architect attempted to dispute it.

26.      Since the October 31, 2016 invoice is not itemized, there is no way to determine how much of the $3,554.72 invoice reflects work performed from February to August 2016. I find HYE violated paragraph IX of the agreement by not billing for the work the month after it was performed, and did not did not disclose that breach until March 10, 2017. For that reason, I find that Dr. Aziza is not obliged to pay the outstanding $2,832.82.

Counterclaim for Retainer

27.      Dr. Aziza says HYE improperly used money from the $4000 retainer to pay the October 31, 2016 invoice for $3,554.72. He says this was done without authorization, and was contrary to the terms set out in HYE’s October 26, 2016 email.

28.      HYE admits that the retainer was not handled in accordance with the terms of the October 26, 2016 email, but says Dr. Aziza is still contractually required to pay their invoices. Dr. Aziza says that because of this breach, HYE should be ordered to return the $4000 retainer, after which he will pay HYE $3,281.10 for the November 2016 invoice.

29.      I find that the $4000 retainer should not be returned.

30.      The parties agree that the November 30, 2016 invoice for $3,278.10 is correct. Since Dr. Aziza owned $3,278.10, it would be meaningless for the tribunal to order refund and repayment of the same amount.

31.      Regarding the October 31, 2016 invoice, as explained above I find that Dr. Aziza is not required to pay the outstanding $2,832.82 because HYE inappropriately billed him for work performed from February to August 2016. The total invoice was for $3,554.72.

32.      Quantum meruit is a legal term meaning a reasonable sum of money to pay for work done when the amount due is not stipulated in a legally enforceable contract. It is clear from the documents provided in evidence that HYE did significant work in October 2016 relating to the two new site plans provided in September and October 2016. This work was specifically requested by the architect on September 12, 2016 and October 18, 2016.

33.      For that reason, I find that Dr. Aziza required is not entitled to reimbursement of the remaining $721.90 of the retainer because the work performed by HYE in October 2016 was worth at least that amount on a quantum meruit basis.

Summary and Tribunal Fees

34.      In summary, Dr. Aziza is not required to pay HYE $2,832.82, and HYE is not required to return the $4,000 retainer.

35.      Under section 49 of the Act, and the tribunal rules, the tribunal will generally order an unsuccessful party to reimburse a successful party for tribunal fees. As HYE’s claim was not successful, I do not order reimbursement of their tribunal fees. Because Dr. Aziza was not successful in his counterclaim, I also do not order reimbursement of his tribunal fees.

ORDERS

36.      I dismiss HYE’s claim. I also dismiss Dr. Aziza’s counterclaim.