A Cautionary Tale On The Necessity Of Strict Compliance With Contractual Terms In Construction Agreements Before Refusing To Proceed With Work Unless Paid

INTRODUCTION

The recent decision by the Ontario Superior Court of Justice in Campus Contracting Inc v. Torbear Contracting Inc., 2023 ONSC 6782 ("Campus v Torbear") is a compelling reminder of the dangers associated with abandoning a construction project for non-payment as well as the necessity, and benefits, of strict compliance with contractual terms, including in respect of payment, notice and termination.

In this case, and in the context of competing positions (and competing expert evidence) with respect to the reason for the failure of pressure testing, failure of water main pipes and failure of four couplings/joints connected to the subject pumping station, the court was asked to consider the scope of work of each of the respective parties and to determine which party breached the subject agreement between them.