Executive Summary: Key Legal and Evidentiary Issues

• Dispute over a terminated construction management contract, including whether a binding construction budget existed and how that affected fee and profit claims.

• Contention over whether interest should follow contractual prime-plus rates in Article A-6.2 or the statutory Court Order Interest Act, and whether any pre-judgment interest was owing at all.

• Major reduction of JM Bay’s construction management, rezoning, and anticipated profit claims after the Registrar’s assessment and the court’s findings on overhead and quantum.

• Determination that earlier deposits and payments fully satisfied any amounts that could have attracted pre-judgment interest, resulting in no pre-judgment interest award.

• Application of contractual, compounded post-judgment interest on the net judgment from March 12, 2025, after accounting for substantial prior and subsequent payments by the defendant.

• Apportioned costs under Rule 14-1(9), with JM Bay only recovering half of its trial costs and part of the assessment costs due to divided success and the defendant’s substantial success in limiting the claims.

Facts and procedural history

JM Bay Properties Inc. entered into a Construction Management Contract with the Tung Cheng Yuen Buddhist Association in September 2015 for a building project, under which JM Bay was to act as construction manager. The relationship deteriorated and the Association terminated the contract, prompting JM Bay to sue for construction management fees, rezoning-related fees, a substantial loss of anticipated profit, and various other heads of damage, along with a builders lien. The case proceeded in the Supreme Court of British Columbia through several phases: liability and most quantum issues were addressed in reasons reported as 2022 BCSC 81 and 2022 BCSC 364, a further damages decision issued as 2025 BCSC 424, and a separate decision, 2025 BCSC 2281, dealt with outstanding issues of interest and costs. At trial, JM Bay’s invoices and claims were subjected to close scrutiny. While a January 2018 invoice sought a large sum, the court found that only $875 for a temporary power pole and a tree protection sign was actually owing under the contract at that time, and that this amount had already been covered by a $31,500 deposit and earlier construction management payments exceeding $40,000. Many of JM Bay’s other claims—reimbursable expenses, miscellaneous costs, damages for breach of a dispute resolution clause, and termination-without-cause damages—were dismissed.

Assessment, quantum findings, and interest clause

Because of evidentiary gaps on the size of the construction fee, the rezoning fee, and the loss of anticipated profit, the judge ordered an assessment before a Registrar. At that assessment, JM Bay’s rezoning fee claim, originally advanced at over $40,000, was settled at $6,000. JM Bay also accepted that its 7.5% construction management fee must be calculated on actual construction costs of $60,000, resulting in a fee of just $4,500 instead of a percentage of a projected $7.7 million budget. The Registrar could not fix the loss of profit and sent that issue back to the trial judge, who ultimately awarded $152,727.50—less than half of what JM Bay had claimed—after accepting much of the defendant’s position on how overhead should be treated. A key contractual provision, Article A-6.2, governed interest where the owner failed to pay amounts due “under the Contract or in an award by arbitration or court,” stipulating interest 2% above prime for the first 60 days and 4% above prime thereafter, compounded monthly, based on the Royal Bank of Canada’s prime business loan rate. JM Bay argued this clause should apply to both pre-judgment and post-judgment interest in place of the Court Order Interest Act.

Rulings on pre-judgment interest, post-judgment interest, and costs

On pre-judgment interest, the judge held there were no outstanding amounts left unpaid that could attract such interest, because the deposit and early payments fully covered any sums arguably due under the contract before judgment. The court also accepted that the main components awarded later—$4,500 for the construction management fee, $6,500 for the rezoning work fee, and $152,727.50 for loss of anticipated profit—were properly characterised as amounts due under a court award rather than pre-existing contractual debts, further undermining any pre-judgment interest claim. In contrast, the court found that Article A-6.2 applied to post-judgment interest. Post-judgment interest was ordered to run from March 12, 2025 (the date of the loss-of-profit judgment), on the three heads of award, net of the $31,500 deposit and two prior payments (net of $875), and subject to a large later payment by Tung Cheng of $120,000 on July 27, 2025. The precise dollar amount of interest was left to counsel to calculate using the contract formula. On costs, the court concluded that, viewed globally, JM Bay did not enjoy “substantial success,” since many claims failed and the core surviving claims were sharply reduced. Nevertheless, as the party that ultimately recovered damages, JM Bay was awarded party-and-party costs at Scale B for 6½ days of trial and one day of the Registrar’s assessment, with each side bearing its own costs for the interest and costs hearing. Overall, JM Bay Properties Inc. emerged as the successful party, with principal damages totalling approximately $163,727.50 plus contractual post-judgment interest and partial costs, although the exact final net amount after credits, interest, and costs cannot be determined from the reasons alone.