Executive Summary: Key Legal and Evidentiary Issues

• Personal liability for a grossly exaggerated builders’ lien does not extend to an employee/agent who verified and served the lien; only the lien claimant can be liable under s. 53 of The Builders’ Lien Act (BLA).

• Interpretation of s. 53 turned on textual coherence and legislative purpose; the “person” who registers and “is owed” is the lien claimant, not its agent.

• Strike application properly allowed under Rule 7-9(2)(a) for no reasonable cause of action; abuse of process analysis was unnecessary once that conclusion was reached.

• Attempts to ground a negligence claim against the agent failed; the BLA does not create a duty of care owed by a lien claimant’s agent to the opposing party.

• Costs against agents are possible under s. 97(1) BLA, but “costs” are not a stand-alone cause of action and do not justify naming the agent as a defendant.

• Appeal dismissed; usual costs awarded to B&M and Farnham, request for elevated costs denied.

Background and parties
Ministikwan Lake Cree Nation contracted with JV&M Civil Constructors for work on water infrastructure projects. JV&M subcontracted mechanical and electrical work to Black & McDonald (B&M) under fixed-price subcontracts. After disputes over quality and timeliness, JV&M signed certificates of substantial performance but withheld full payment. B&M filed and served a lien; its division manager, Brian Farnham, swore the verifying affidavit under s. 50(3) BLA and served the lien on JV&M. B&M then sued JV&M, Ministikwan, and others for breach of contract, unjust enrichment, and breach of trust.

Counterclaim and chambers ruling
JV&M defended and counterclaimed, alleging the lien was grossly exaggerated and that both B&M and Farnham should be liable, including for solicitor-client costs. Farnham and B&M applied to strike the claims against Farnham. The Chambers judge struck those portions under Rule 7-9(2)(a) (no reasonable claim) and, alternatively, as an abuse of process under Rule 7-9(2)(e), awarding $5,000 costs. JV&M appealed.

Issues on appeal
The Court of Appeal considered whether the Chambers judge erred in: (1) striking the counterclaim against Farnham for disclosing no reasonable cause of action and as an abuse of process; and (2) not permitting JV&M to amend to add negligence and a claim for solicitor-client costs under s. 97 BLA.

Court’s analysis
Interpreting s. 53 BLA The core question—can someone other than the lien claimant be sued for a grossly exaggerated lien?—was answered “no.” Applying the modern approach, the Court read s. 53’s text in context and purpose: the “person who registers a claim of lien” and the person “who is owed” are one and the same—the lien claimant (which may be a corporation). Imposing personal liability on an agent who gains no benefit from the lien would undermine the scheme of the Act, which protects those supplying work and materials on credit. The Court endorsed the Chambers judge’s reliance on Ontario authority (Christie Mechanical) reaching the same conclusion. Therefore, any s. 53 liability lies with B&M as lien claimant, not with Farnham as its agent.

Negligence claim against the agent The proposed negligence amendment failed as a matter of law. The BLA does not create a duty of care owed by a lien claimant’s agent to an owner or contractor. Sections cited by JV&M (including 22, 28, 50(3), 83) do not establish proximity or a tort duty by an agent; the only statutory liability route for wrongful liens is s. 53, which applies to the lien claimant. Consequently, a negligence claim against Farnham had no reasonable chance of success.

Costs against non-parties under s. 97(1) BLA While s. 97(1) expressly allows a court to order costs against a party’s solicitor or agent—e.g., where an excessive lien is pursued—“costs” are an incident of litigation, not a “cause of action.” Thus, possible exposure to costs does not justify naming the agent as a defendant. The proper course is to seek costs at the conclusion of proceedings without adding the agent as a party.

Abuse of process
Given the absence of a reasonable cause of action, the Court found it unnecessary to decide abuse of process. The strike under Rule 7-9(2)(a) was sufficient to sustain the result.

Disposition and costs
The appeal was dismissed. The Court declined B&M’s request for elevated costs, instead granting one set of costs for the appeal and one set for the application to perfect the appeal, in the usual manner.