Let Me Be Direct: Pleading Admissions As Evidence Of A Direct Contract

The trial decision in Sjostrom Sheet Metal Ltd. v. Geo A. Kelson Company Limited¹ contains several insights for parties navigating disputes arising from distressed construction projects.

In Sjostrom, the Ontario Superior Court granted relief to an unpaid subcontractor, denied relief to a contractor for failure to provide timely notice of default, and dismissed a sub-subcontractor's lien claim due to the failure to prove labour costs.

In arriving at its decision, the court overcame a number of evidentiary hurdles to find a valid and unwritten direct contract between a subcontractor and a sub-sub-subcontractor. The court relied on admissions in the subcontractor's own pleadings to support its finding. The court also reviewed other evidentiary and notice issues applicable to a broad range of projects.