Executive Summary: Key Legal and Evidentiary Issues

• Scope and breach of the home renovation contract, including the contractor’s obligation to act honestly, in good faith, and to complete the project in a timely and workmanlike manner.
• Effect of default under the Rules of Civil Procedure, and the extent to which pleaded facts are deemed admitted on a motion for default judgment.
• Evidentiary sufficiency of the homeowner’s affidavit and supporting documents to prove deficient work, incomplete performance, and the cost of remediation and completion.
• Allocation of liability between a sole proprietor and the business name (MGP Consulting Group), treating both as one and the same for judgment and enforcement purposes.
• Measure of contractual damages in a construction context, including recovery of additional costs to fix shoddy work, complete the project, and pay related consequential expenses.
• Treatment of overlapping negligence and contract claims where the same factual matrix and damages render a negligence analysis unnecessary.

Facts of the case

John and Christine Papanicolaou hired contractor Maurizio Privitera, operating under the business name MGP Consulting Group, to carry out a substantial renovation of their home. The work included bedroom and bathroom renovations, a new kitchen, new flooring, and a new back deck. The arrangement was formalized in a written agreement under which MGP Consulting Group would act as project manager for the entire renovation project, sourcing subcontractors, materials, and overseeing the work. The Agreement set a contract price of $270,000 plus tax, with a $35,000 reduction corresponding to the tax component, and specified that the project was to be completed by December 15, 2022. MGP Consulting Group presented a quote and represented that it had the requisite skill to perform and manage the renovation.
Under the project management terms, MGP Consulting Group undertook several key obligations: to source subcontractors, suppliers, and materials; to act honestly and in good faith in the clients’ best interests; to perform its services in a timely and diligent manner; and to prepare a schedule with milestone dates for the clients. These provisions set the standard by which the contractor’s performance would be assessed, particularly in terms of timeliness, workmanship, and fiduciary-like duties around honesty and good faith in managing funds and work on site.
The work did not progress as planned. According to the plaintiffs’ pleadings and affidavit evidence, the renovation work was poorly performed and significantly delayed. Assurances from Mr. Privitera that the work would be properly and promptly completed were not borne out. Subcontractors left the site because they were not paid, indicating cash-flow or payment failures by the contractor that directly impacted progress. A home inspection report later catalogued multiple deficiencies in the workmanship and construction quality.

Contract performance, deficiencies, and termination

The plaintiffs paid a deposit of $130,000 toward the renovation, but the project never approached completion. Instead, they were presented with an invoice suggesting that the entire deposit had been exhausted when, on the evidence, that was not accurate. This false or misleading invoice was an important factual element supporting the inference that MGP Consulting Group had not acted honestly or in good faith as required by the Agreement, particularly in its handling and accounting of project funds.
By December 2022, in light of extensive deficiencies, lack of progress, and non-payment of subcontractors, the plaintiffs terminated the Agreement and engaged new contractors to salvage and complete the work. They obtained estimates both to remediate the defective work already carried out and to complete the remaining portions of the renovation. The plaintiffs then proceeded with a different contractor structure to finish the project at a higher overall cost than originally contemplated.
Building Integrity was retained to remediate and complete the project (on a reduced scope compared to the original plan) for $335,598.50. The plaintiffs also paid $30,284 to Pronto Construction to complete the necessary framing. A third contractor, K-Mac Contracting, was paid $33,500 to remediate and properly build the deck that had been started, but poorly executed and left unfinished by the defendants. In addition to these construction costs, the plaintiffs incurred extra storage charges of $2,163.95 due to an approximate six-month delay in project completion, $2,257.74 to re-purchase balcony doors damaged by the defendants, and $508.50 for the home inspection report that documented the deficiencies.

Procedural history and default judgment posture

Procedurally, the defendants were noted in default on March 26, 2024, after failing to defend the action. The claim against co-defendant Nadia Zannella was stayed under s. 69.3(1) of the Bankruptcy and Insolvency Act, and the remaining defendants were served with the plaintiffs’ motion materials for default judgment on May 3, 2024. A motion was later brought by some defendants to set aside the noting in default. Following several attendances, Justice Brownstone denied the motion to set aside the default as against Mr. Privitera and MGP Consulting Group, while granting relief to co-defendant Jennifer Pannozzo. As a result, the default judgment motion proceeded in writing only against Mr. Privitera and MGP Consulting Group.
Because those defendants remained noted in default, the factual allegations in the statement of claim were deemed admitted. However, the court emphasized that even on a default motion, a judge must scrutinize the deemed admissions and supporting evidence to ensure that the plaintiff is legally entitled to the judgment sought. Deemed admissions do not extend to conclusions of law or mixed fact and law; the facts as pleaded must, if accepted as true, establish the legal elements of the claim and justify the remedy requested.

Status of MGP Consulting Group as a sole proprietorship

The decision also addressed the legal status of MGP Consulting Group. It was not a separate legal entity but a business name under which Mr. Privitera operated as a sole proprietor. Under Rule 8.07 of the Ontario Rules of Civil Procedure, a person carrying on business under a business name may be sued in that business name. The court clarified that, in substance, the liability analysis focused on the acts and omissions of Mr. Privitera himself; any judgment against the business name would effectively be enforceable against the property used in the sole proprietorship’s business and was duplicative of the judgment against him personally. As pleaded, both Mr. Privitera and MGP Consulting Group were named as defendants, but for liability purposes they were treated as one and the same.

Liability analysis and measure of damages

On the basis of the admitted facts and the affidavit evidence of Mr. Papanicolaou, the court found that MGP Consulting Group had breached the Agreement. It failed to complete the project in a timely manner and did not perform the work in a good and workmanlike fashion. The mismanagement of subcontractors, non-payment causing trades to leave the site, incomplete and defective work, and the false invoice suggesting depletion of the deposit all supported the finding of breach. As a sole proprietor, Mr. Privitera was personally responsible for any breach committed in the name of MGP Consulting Group.
The plaintiffs had also pleaded negligence in the performance of the work, but the court found that once breach of contract was established and the damages sought were the same under both theories, it was unnecessary to undertake a separate negligence analysis. The contractual framework, including express obligations to act honestly, in good faith, and with diligence, was sufficient to ground liability and the requested relief.
In assessing damages, the court applied the standard contractual principle that an innocent party is entitled to be placed in the position they would have occupied had the contract been properly performed. The Agreement contemplated completing the entire project for $270,000. In reality, the plaintiffs paid a total of $534,312 (including the original $130,000 deposit and all subsequent remediation and completion expenses). This meant they had to spend $264,312 more than the contract price to have the renovation completed to the standard they were originally promised. The court accepted the plaintiffs’ documentary back-up and evidence for these expenses, including the remediation and completion contracts, storage charges, replacement doors, and inspection fees, and concluded that these costs were properly recoverable as damages arising from the contractor’s breach.

Outcome and total monetary relief

The court granted default judgment in favour of the plaintiffs, John and Christine Papanicolaou, against defendants Maurizio Privitera and MGP Consulting Group. It ordered damages in the amount of $264,312, reflecting the additional costs the plaintiffs incurred beyond the original $270,000 contract price to remediate and complete the renovation. The court also awarded partial indemnity costs, finding the amount claimed to be fair and reasonable, and fixed those costs at $10,3014 as written in the reasons, despite the internal inconsistency of that figure. In addition, the judgment included an award of pre- and post-judgment interest pursuant to the Courts of Justice Act, though the precise dollar value of interest was not calculated in the reasons. Accordingly, the successful parties are the plaintiffs, who obtained judgment for $264,312 in damages plus $10,3014 in costs and an unquantified amount of pre- and post-judgment interest, such that the exact overall total monetary sum cannot be fully determined from the text of the decision alone.