Executive Summary: Key Legal and Evidentiary Issues

• The central issue was whether a one-page budget or a later four-page pricing document formed the binding construction contract.

• The court upheld that the December 17, 2018 budget document was the valid agreement.

• Bellsam’s failure to call key witnesses led to adverse inferences that undermined its position.

• The reviewing judge affirmed that factual findings and contract interpretation by the Associate Justice were entitled to deference.

• Bellsam's new argument about lender approval was rejected as it was not raised at trial.

• The motion was dismissed for lack of legal or factual error, and the Associate Justice’s report was confirmed.

Background and dispute

The case of Bellsam Contracting Ltd. v. 2567714 Ontario Inc., 2025 ONSC 2887 involves a construction lien action stemming from a partial build-out of a cosmetic surgery clinic in Toronto’s Yorkville neighbourhood. The project was led by Nadine and Dr. Cory Torgerson, who hired Bellsam Contracting Ltd., a general contractor known for building medical and dental facilities. Bellsam carried out construction between December 2018 and July 2019 and was paid over $2.4 million. However, the project was not completed, and Bellsam eventually ceased work and filed a lien action under Ontario’s Construction Act.

The core dispute focused on which of two documents governed the parties’ contractual relationship: a one-page budget estimate from December 17, 2018, quoting a cost of $2.3 million, or a four-page pricing proposal from January 15, 2019, with a revised amount of $2,699,340.

Findings at trial of an issue

Associate Justice Robinson previously conducted a trial of an issue to determine the governing contract. He concluded that the December 2018 document was the operative contract and that the January 2019 proposal was simply an unaccepted estimate. His decision was grounded in testimony from seven defence witnesses, with Bellsam presenting only one witness—an office manager lacking direct knowledge of key events. Significant portions of that testimony were hearsay and excluded by consent. The Associate Justice also drew adverse inferences against Bellsam for failing to call individuals who had firsthand knowledge of the contractual discussions.

The Associate Justice applied established principles of contract formation and interpretation, including the approach set out by the Supreme Court of Canada in Sattva Capital Corp. v. Creston Moly Corp., to conclude that the earlier budget was the binding agreement. Bellsam’s argument that the later document formed a revised contract was rejected due to lack of acceptance and consideration.

Motion to oppose confirmation of report

Bellsam brought a motion under Rule 45.09 of the Rules of Civil Procedure, seeking to oppose the confirmation of the Associate Justice’s report. Justice Leiper reviewed the matter and emphasized the high degree of deference owed to trial-level findings of fact and credibility. Citing authorities such as Housen v. Nikolaisen and Sjostrom Sheet Metal Ltd. v. Geo A. Kelson Company Ltd., she affirmed that review is limited to correcting errors of law or palpable and overriding errors of fact.

Justice Leiper found that Bellsam’s new argument—that Nadine’s text message made contract acceptance conditional on lender approval—was never raised at trial and unsupported by evidence. Desjardins, the alleged lender, was not a party to the contract, and Bellsam called no evidence from its representatives. As such, the judge declined to consider a theory that was not advanced before the Associate Justice.

Conclusion and outcome

Justice Leiper concluded that the Associate Justice’s decision was thorough, well-reasoned, and free of any legal or factual error. The motion was dismissed, and the interim report was confirmed. If the parties cannot agree on costs, they were invited to submit written arguments of no more than three pages.

This case demonstrates the importance of presenting complete, credible evidence at trial, especially in contract disputes arising in the construction context. It also reinforces the principle that appellate-level courts will not second-guess trial judges’ factual determinations absent a clear and compelling reason.