Executive Summary: Key Legal and Evidentiary Issues

• This case involves a small claims appeal by Sayed Ismail against Custom Carpentry by Marc Inc. over a disputed renovation invoice of $10,460.11.
• Central to the appeal is whether the six grounds raised by Mr. Ismail constitute questions of law or jurisdiction, as required under s. 20 of the Small Claims Act, SNB 2012 c.15.
• Contractual interpretation — including the agreed hourly labour rate and the scope of the renovation work — was treated as a question of mixed fact and law, not a pure question of law, following Sattva Capital Corp. v. Creston Moly Corp. [2014] 2 SCR 633.
• Grounds 1 through 5 of the appeal were dismissed as they each raised questions of fact, including disputes over the hourly rate, altered invoices, labour hours, materials costs, and the non-return valve installation.
• Procedural fairness under the audi alteram partem rule was engaged by Ground 6, as denial of natural justice constitutes an excess of jurisdiction and is a permissible ground of appeal.
• Despite Mr. Ismail's submissions, the court found no breach of procedural fairness, as the hearing spanned two full days and he was permitted to file written arguments at its conclusion.

Facts of the case

Sayed Ismail hired Custom Carpentry by Marc Inc. to perform renovations on his home. Upon completion, Custom Carpentry issued an invoice for $10,460.11. Mr. Ismail refused to pay, alleging that Custom Carpentry had unilaterally charged an hourly rate higher than agreed, inflated the hours worked, delivered poor workmanship — including improper installation of a non-return valve — and overcharged for materials. Custom Carpentry filed a claim against Mr. Ismail under the Small Claims Act for the full invoice amount. Mr. Ismail filed a response denying the claim and submitted a counterclaim of $4,000.00 for damages arising from delays, expected remediation of errors, and increased risk of failure of the house drainage system due to the allegedly improper installation of the non-return valve. Following a two-day hearing, the adjudicator issued a decision dated November 6, 2025, largely in favour of Custom Carpentry. After adjustments, the adjudicator awarded Custom Carpentry $9,229.08, allowed only $100.00 of Mr. Ismail's counterclaim to remedy deficiencies, and entered judgment against Mr. Ismail in the net amount of $9,129.08. Mr. Ismail filed a Notice of Appeal on December 8, 2025, pursuant to s. 20 of the Small Claims Act, raising six grounds of appeal before the Court of King's Bench of New Brunswick.

Contractual terms at issue

The central contractual dispute concerned the terms of an oral agreement for renovation work. Mr. Ismail alleged that the contract was unilaterally converted to a fixed-price arrangement and that the agreed labour rate was $45.00 per hour. The adjudicator, however, found based on her assessment of the parties' conduct and testimony that the scope of work had expanded at both Mr. Ismail's request and due to unforeseen circumstances, and that the parties had, through their conduct, agreed to an hourly rate of $50.00 per hour. The appeal also engaged s. 42.1(2) of the General Regulation – Small Claims Act, NB Reg. 2012-103, which limits appeals to the Court of King's Bench to questions of law or jurisdiction only.

Reasoning and analysis

Justice Morrison's analysis began with the threshold question of whether any of the six grounds raised a question of law or jurisdiction. Relying on Canada (Director of Investigations and Research) v. Southam Inc. [1997] 1 SCR 748 and Patel v. New Brunswick (Executive Director of Assessment), 2024 NBCA 108, the court affirmed that the standard of review on questions of law is correctness, but that findings of fact cannot ground an appeal to the Court. Applying Sattva Capital Corp. v. Creston Moly Corp. [2014] 2 SCR 633 — as canvassed in New Brunswick Highway Corporation v. MRDC Operations Corporation, 2023 NBCA 19 — the court held that contractual interpretation is a question of mixed fact and law, not a pure question of law. Grounds 1 through 3 were dismissed as factual disputes: Ground 1 concerned the adjudicator's assessment of the agreed rate and scope of work; Ground 2 challenged the adjudicator's finding that there was no evidence of an altered invoice; and Ground 3 disputed the adjudicator's acceptance of Custom Carpentry's time sheets over Mr. Ismail's own records. Ground 4, relating to the non-return valve, was likewise dismissed as a factual matter — Mr. Ismail bore the burden of proof on his counterclaim, called no independent expert evidence to refute the licensed plumber called by Custom Carpentry, and the court found no logical inconsistency between the adjudicator's inability to determine the valve's location and her separate finding that Mr. Ismail's claimed damages were too speculative to be recoverable. Ground 5 — alleging failure to address evidence on materials costs and quantities — was dismissed because a decision-maker is not required to address every piece of evidence, provided some evidence supports the findings made. Ground 6 was treated differently: the court found it raised a question of natural justice — specifically, the audi alteram partem rule — which constitutes an excess of jurisdiction and is a permissible ground of appeal. Applying the Baker v. Canada (Minister of Citizenship and Immigration) [1999] 2 SCR 817 factors as summarized in Wilson v. Department of Social Development, 2024 NBCA 41, the court confirmed that Mr. Ismail was entitled to a fair hearing. However, it found no breach: the matter was heard over two full days (considerably longer than the standard half-day allocation for small claims), and Mr. Ismail was permitted to file written arguments at the conclusion of the hearing.

Ruling and overall outcome

The Court of King's Bench dismissed the appeal in its entirety. All six grounds of appeal failed — grounds 1 through 5 because they raised questions of fact rather than law, and ground 6 because no breach of procedural fairness was established. Custom Carpentry by Marc Inc. was the successful party. As Custom Carpentry did not appear or participate in the appeal proceedings, the court declined to award it costs on the appeal. The net judgment of $9,129.08 entered against Mr. Ismail at the adjudicator level accordingly stands.