Executive Summary: Key Legal and Evidentiary Issues

• Dispute arose from construction work and payment obligations under the Inuvik High Point Wind Project’s access road contract.

• Northland sought summary judgment to dismiss ONEC’s claims and secure judgment on its counterclaim for unpaid invoices.

• Central legal questions involved contract interpretation, surety bond coverage, and alleged torts including inducing breach of contract.

• Evidence issues included conflicting affidavit testimony, lack of documentation for certain invoiced amounts, and credibility challenges.

• Court found liability in Northland’s favor against ONEC and Liberty but ordered a trial solely to determine damages.

• Claims against NWT Energy Corporation were dismissed, resulting in split cost awards.

Facts and outcome of the case

Background of the dispute
This litigation stems from the Inuvik High Point Wind Project, an infrastructure project to construct a wind turbine, battery storage system, and supporting facilities in Inuvik, Northwest Territories. NWT Energy Corporation (NTE) owned the project. ONEC Construction Inc. was engaged through a Prime Contract for access road construction, and Northland Builders Ltd., a Gwich’in-owned company, became involved through an Integrated Project Delivery (IPD) Contract with ONEC. Liberty Mutual Insurance Company acted as ONEC’s surety under a Labour and Material Payment Bond.

The relationship between ONEC and Northland was contested, with ONEC claiming a partnership and Northland asserting it was a subcontractor. Disputes arose over unpaid invoices, the scope of work, and project delays. ONEC alleged Northland induced breaches of contract, damaged equipment, and misused fuel after termination of the IPD Contract. Northland counterclaimed for breach of contract and sought payment for work and standby charges.

Procedural history
ONEC filed its Statement of Claim on April 27, 2023. Northland responded with a Statement of Defence and Counterclaim on September 21, 2023, seeking payment from ONEC, Liberty, and, alternatively, from NTE. On September 19, 2024, Northland applied for summary judgment to dismiss ONEC’s claim and obtain judgment on its counterclaim.

Court’s analysis
Justice Annie Piché reviewed whether the issues could be decided without a trial under Rules 174–176 of the Supreme Court of the Northwest Territories Rules. The court found ONEC had presented no evidence to support its tort and damage claims against Northland. It rejected new breach of contract arguments not pleaded in the Statement of Claim.

On the counterclaim, the court concluded that Northland was not a party to the Prime Contract with NTE but did have a direct contract with ONEC under the IPD Contract, qualifying as a claimant under the bond. ONEC and Liberty were held liable for contractual damages. However, the judge found factual disputes and credibility issues regarding invoice amounts, particularly unsupported flat-rate charges and labor claims, which required a trial to resolve damages.

Outcome
The court dismissed ONEC’s claims against Northland entirely. Northland succeeded in establishing liability against ONEC and Liberty on its counterclaim, with the damages amount to be determined at trial. The claim against NTE was dismissed.

Costs
Northland was awarded party-and-party costs against ONEC and Liberty. NTE was awarded party-and-party costs against Northland. No damages were set at this stage, as quantification will be addressed at trial.