Date Issued: August 26, 2022

File: SC-2021-006479

Type: Small Claims

Civil Resolution Tribunal

Indexed as: Nagy v. Nejad, 2022 BCCRT 957

Between:

MARC NAGY

Applicant

And:

MIKE NEJAD and MAHDIS NAHASATI

Respondents

REASONS FOR DECISION
Tribunal Member:	Micah Carmody

INTRODUCTION

1.      This respondent, Mike Nejad, hired the applicant, Marc Nagy, to paint a home’s interior.

2.      Mr. Nagy painted the home over the course of a few days in August 2021. Mr. Nejad undisputedly paid Mr. Nagy $1,000. Mr. Nagy claims an outstanding balance of $669.50 in this dispute for labour, materials and fuel expenses.

3.      Mr. Nejad says he did not pay Mr. Nagy because there were outstanding defects. He also says Mr. Nagy said the job could be done for around $1,600. Mr. Nejad says I should dismiss the claim.

4.      Mr. Nagy and Mr. Nejad represent themselves in this dispute. The other respondent, Mahdis Nahasati, did not a Dispute Response as required and is technically in default, as discussed below.

JURISDICTION AND PROCEDURE

5.      These are the formal written reasons of the Civil Resolution Tribunal (CRT). The CRT has jurisdiction over small claims brought under section 118 of the Civil Resolution Tribunal Act (CRTA). Section 2 of the CRTA states that the CRT’s mandate is to provide dispute resolution services accessibly, quickly, economically, informally, and flexibly. In resolving disputes, the CRT must apply principles of law and fairness, and recognize any relationships between the dispute’s parties that will likely continue after the CRT process has ended.

6.      Section 39 of the CRTA says the CRT has discretion to decide the format of the hearing, including by writing, telephone, videoconferencing, email, or a combination of these. Here, I find that I am properly able to assess and weigh the documentary evidence and submissions before me. Further, bearing in mind the CRT’s mandate that includes proportionality and a speedy resolution of disputes, I find that an oral hearing is not necessary in the interests of justice.

7.      Section 42 of the CRTA says the CRT 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 CRT may also ask questions of the parties and witnesses and inform itself in any other way it considers appropriate.

8.      Where permitted by section 118 of the CRTA, in resolving this dispute the CRT may order a party to do or stop doing something, pay money or make an order that includes any terms or conditions the CRT considers appropriate.

ISSUE

9.      The issue in this dispute is whether the respondents owe Mr. Nagy the claimed $669.50 for painting work.

EVIDENCE AND ANALYSIS

10.   As the applicant in this civil proceeding, Mr. Nagy must prove his claims on a balance of probabilities, meaning more likely than not. I have considered all the parties’ evidence and submissions, but only refer to what is necessary to explain my decision.

11.   At the outset I will address Mahdis Nahasati’s liability. As noted, Mahdis Nahasati did not provide a Dispute Response and is in default. This means generally that liability is assumed. However, Mr. Nagy did not explain who Mahdis Nahasati is or why they may be responsible to pay for the paining work. Mr. Nagy’s claim is based on breach of contract, and it is undisputed that the contract was between Mr. Nagy and Mr. Nejad. The common law concept of privity of contract says that as a general rule, a contract cannot give rights or impose obligations on a person who is not a party to the contract. Therefore, I find the presumption of liability is rebutted and I dismiss the claim against Mahdis Nahasati. Where I use the term “parties” below, I refer to the contracting parties, Mr. Nagy and Mr. Nejad.

12.   On August 1, 2021, Mr. Nejad met Mr. Nagy at the home to be painted, which Mr. Nejad rented to tenants. Mr. Nagy did some work inspecting and repairing ventilation in the home and charged Mr. Nejad $170, which Mr. Nejad paid and is not at issue in this dispute. Mr. Nejad asked Mr. Nagy for a quote to paint the home’s interior.

13.   Although Mr. Nejad says Mr. Nagy said he could do the job for around $1,600, I find that was an estimate and the parties did not have a fixed-price contract. I say this because in the parties’ text messages, Mr. Nejad never contradicted Mr. Nagy’s initial text that the parties negotiated a “$35 hourly cost plus contract”.

14.   I also find based on the text messages that the parties agreed Mr. Nejad would reimburse Mr. Nagy for paint and reasonable supplies, and would pay a $25 per visit fuel charge.

15.   Mr. Nagy began work on August 2. At the end of each day Mr. Nagy sent Mr. Nejad a text message with a summary of his hours worked and the applicable charges for labour and fuel. Sometimes, Mr. Nagy sent photos to show the painting progress. Mr. Nejad consistently responded with acknowledgment or approval of the work and the charges.

16.   I accept Mr. Nagy’s evidence that Mr. Nejad agreed to pay Mr. Nagy every time the total owed reached $500. Mr. Nejad paid Mr. Nagy $500 on August 6, 2021, and another $500 on August 7. At that point, the work was unfinished, but Mr. Nejad expressed no concerns about the work’s pace or cost.

17.   Mr. Nagy returned on August 8 for 5 hours to finish painting baseboards and trim. I find the work was substantially complete at that point. The total balance due was $669.50, the amount claimed in this dispute. This included $57 for paint and stain blocker and $75 for 3 days’ fuel charges. The balance was labour charges. I note Mr. Nejad does not specifically dispute the supplies or fuel charges.

18.   On August 10, Mr. Nejad complained to Mr. Nagy that in 1 bedroom, the old colour underneath the new paint was bleeding through. He also said there was a “visible line” in the dining room. Mr. Nagy was prepared to paint a second coat in the bedroom and to address the dining room issue. However, Mr. Nejad said he would not pay for Mr. Nagy’s time to fix those issues.

19.   In submissions, Mr. Nejad says he was willing to pay Mr. Nagy if Mr. Nagy came back and finished the work. To be more specific, his text message said “please finish the bedroom at your own expense and I will pay the outstanding cost. Or I can hire someone else and deduct from the outstanding cost.”

20.   The law does not support Mr. Nejad’s position. First, as a general principle, a contractor is entitled to payment upon substantial completion of the work (see Belfor (Canada) Inc. v Drescher, 2021 BCSC 2403). I find Mr. Nagy substantially completed the painting work and was entitled to payment and an opportunity to address the alleged deficiencies. Second, from the parties’ texts I find that Mr. Nejad initially instructed Mr. Nagy to paint only 1 coat in the bedroom to reduce costs, so I find it was not truly a deficiency and Mr. Nejad was required to pay for a second coat. Third, Mr. Nejad agreed to pay Mr. Nagy each time the debt reached $500. As of August 10, Mr. Nejad owed $669.50. So, if Mr. Nejad wanted Mr. Nagy to do any more work, he was required to pay Mr. Nagy $500 first.

21.   As for Mr. Nejad’s argument that Mr. Nagy did not do adequate work overall, he only provided photos showing minor wall dents and marks and a few paint drips. I find that these were minor deficiencies that Mr. Nagy could have addressed had he been given the opportunity.

22.   For the above reasons, I find Mr. Nagy has established his entitlement to the claimed $669.50.

23.   The Court Order Interest Act applies to the CRT. I find Mr. Nagy is entitled to pre-judgment interest on the $669.50 debt from August 10, 2021, the date I find it was payable, to the date of this decision. This equals $4.46.

24.   Under section 49 of the CRTA and CRT rules, the CRT will generally order an unsuccessful party to reimburse a successful party for CRT fees and reasonable dispute-related expenses. I find Mr. Nagy is entitled to reimbursement of $150 in CRT fees. I also allow Mr. Nagy’s claim for $6.08 in printing costs and $12.27 for registered mail fees, which were supported by receipts and I find reasonable given Mr. Nejad undisputedly refused to provide an address for service. On a judgment basis, I reduce the claim for $75 in fuel costs related to 3 attempts to serve to $40 because Mr. Nagy did not provide receipts or mileage details.

ORDERS

25.   Within 14 days of the date of this order, I order Mr. Nejad to pay Mr. Nagy a total of $882.31, broken down as follows:

a.    $669.50 in debt,

b.    $4.46 in pre-judgment interest under the Court Order Interest Act, and

c.    $208.35, for $150 in CRT fees and $58.35 for dispute-related expenses.

26.   Mr. Nagy is entitled to post-judgment interest, as applicable.

27.   I dismiss the claims against Mahdis Nahasati.

28.   Under section 58.1 of the CRTA, a validated copy of the CRT’s order can be enforced through the Provincial Court of British Columbia. Once filed, a CRT order has the same force and effect as an order of the Provincial Court of British Columbia.