Executive Summary: Key Legal and Evidentiary Issues

• The dispute concerned whether JonesCo Contracting Incorporated was entitled to charge Andrea Caldwell an additional $82,432.00 for infill and excavation services beyond the fixed-price contract without her prior consent or a change order.

• The contract explicitly required that extra services and materials be agreed to in advance and confirmed by a change order, which was not done for the additional charge at issue.

• JonesCo’s arguments relied on both the interpretation of the contract and a quantum meruit defense, but both were rejected by the court.

• The court found there was no genuine issue of material fact, making the matter appropriate for summary judgment.

• Ms. Caldwell paid the disputed amount “under protest” to obtain the keys to her new home after JonesCo refused to provide possession until full payment was made.

• The court ordered JonesCo to reimburse Ms. Caldwell the $82,432.00, together with pre-judgment interest and costs of the motion.

Facts of the case

Andrea Caldwell (the Plaintiff) entered into a fixed-price contract with JonesCo Contracting Incorporated (the Defendant) for the construction of a house at 250 Owl Drive, Musquodoboit Harbour, Nova Scotia. The contract, titled “Building Contract, New Home Construction,” was signed on October 19, 2021, and set the total price at $648,429.95, including HST, with adjustments for allowance items as listed in Schedule “A.” The agreement required a $40,000.00 deposit and four subsequent draws to cover the contract price.

Schedule “A” included a $5,000.00 allowance for “Foundation / structural rock infill,” which covered all infill materials, trucking, rolling or tamping, engineering, and removal of unsuitable materials. This allowance was set by JonesCo without input from Ms. Caldwell. The contract stated that if the final amount for any allowance exceeded the allocated amount, the client must pay the extra at closing.

On April 18, 2023, JonesCo invoiced Ms. Caldwell an additional $71,680.00 plus HST of $10,752.00 (totaling $82,432.00) for infill extras in its fourth and final draw. Ms. Caldwell paid this amount “under protest” to obtain the keys to her new home, as JonesCo would not release possession until full payment was received. In total, Ms. Caldwell paid $838,460.40 to JonesCo, exceeding the fixed-price agreement by $190,030.45. The parties agreed that JonesCo had overcharged Ms. Caldwell $23,000.00 due to an arithmetical error, which was resolved by agreement and was not part of this motion.

Discussion of policy terms and clauses at issue

The contract contained several relevant provisions. Clause 9 (“EXTRAS”) stated that the contractor would only receive additional remuneration for extra services and materials when both parties had agreed to the cost and date of completion, and the amendment had been confirmed by a change order. The buyer was to pay for extras promptly upon their completion, and any unforeseen conditions requiring extra work were to be communicated and billed to the buyer after prior notification and consent.

Clause 8 (“CHANGES”) allowed the buyer to request changes in writing, which the contractor would confirm in writing with the additional cost, to be attached as a “Change order.” The last sentence of this clause stated that change orders were not required by the contractor for excavation, infill materials, or geotechnical items required due to lot conditions or placement of the home on the lot.

Clause 4(c) under “Buyer’s Covenants” addressed lot conditions, stating that the buyer was responsible for all existing lot conditions, including the need for fill materials to correct grades or import structural rock, with all associated costs being the responsibility of the buyer. Clause 1(b)(i) under “Scope of Work” stated that the contractor was not responsible for obtaining well or geotechnical engineering, and that any infilling amounts required additional to allowance amounts listed in Schedule “A” were the buyer’s responsibility. An affidavit from Mike Jones, JonesCo’s Owner and President, acknowledged a drafting error in this provision, clarifying that it should have referenced Schedule “A.”

Prior to signing the agreement, JonesCo’s President sent Ms. Caldwell an email on August 30, 2021, mentioning the possibility of extra costs “in case we need structural rock,” estimating $10,000–$15,000 might be needed. However, the court noted that the agreement constituted the entire contract, and pre-contract discussions would only be relevant if there were ambiguities.

Legal analysis and application of summary judgment principles

The court applied Nova Scotia Civil Procedure Rule 13.04 and the analytical framework from Shannex Inc. v. Dora Construction Ltd., 2016 NSCA 89, and Arguson Projects Inc. v. Gil-Son Construction Limited, 2023 NSCA 72. The court found there was no genuine issue of material fact: the facts were undisputed, and the dispute was purely legal—whether JonesCo was entitled to the extra payment under the contract or on a quantum meruit basis.

The court determined that JonesCo’s failure to notify Ms. Caldwell and obtain her consent for the additional work before proceeding was a breach of the agreement. The court also rejected JonesCo’s quantum meruit defense, citing authority that equitable remedies such as quantum meruit cannot override the express terms of a valid contract.

Ruling and outcome

The Supreme Court of Nova Scotia granted Ms. Caldwell’s motion for partial summary judgment. The court ordered JonesCo to reimburse Ms. Caldwell the $82,432.00 she paid for the extra infill and excavation charges, along with pre-judgment interest and the costs of the motion. The court left the determination of the exact amount of costs and interest to be resolved by counsel or, if not agreed, by further written submissions within 30 days. Other claims by Ms. Caldwell against JonesCo, which were not the subject of this summary judgment motion, remain to be litigated in due course. In this decision, Ms. Caldwell was the successful party and was awarded the full amount she sought for the disputed extras.