IN THE PROVINCIAL COURT OF BRITISH COLUMBIA

[1]           Travis Molison and Kirk Niedermayer were once friends.  Mr. Niedermayer hired Mr. Molison to replace windows and siding (the “Project”) at his home located at 1102 Sterling Drive in Prince George (the “house.”)  Mr. Molison and his crew performed work on the Project.  Mr. Niedermayer opened an account at RONA so that materials used on the Project could be purchased on that account.  Ultimately, the Project passed inspection and Mr. Niedermayer’s bank released the funds to him to pay for the work.  However, Mr. Niedermayer did not pay Mr. Molison anything for the work he and his workers performed on the Project.

[2]           Mr. Molison seeks payment for the labour that he and his workers put into the Project.  Mr. Molison says that he estimated the materials to be approximately $14,000.00, and that it was agreed that the labour for the Project would be $14,000.00.  During the Project one wall of the garage was discovered to be rotten and he said Mr. Niedermayer and he agreed that the labour to rebuild it and to reframe a window opening (so that it could have a patio door installed in it in future) would be an additional $1,000.00.  He says Mr. Niedermayer agreed to allow him to charge some materials on a different job of Mr. Molison’s to Mr. Niedermayer’s RONA account, which he agrees should be deducted from his claim.  Mr. Molison seeks, accordingly, $15,000.00 less the items charged to Mr. Niedermayer’s account.  At trial, Mr. Molison agreed that some small reductions, in the amount of $1,075.00 should be made to that amount to complete some work that remained unfinished when the contractual relationship broke down, as well as to address some deficiencies in the work that was done.

[3]           Mr. Niedermayer has taken various positions throughout this litigation.  In his Reply and throughout the trial, Mr. Niedermayer maintained that there was no contract between himself and Mr. Molison with respect to his obligation to provide payment, although he appears to rely on the existence of a contract with respect to the obligations of Mr. Molison to perform work.  With respect to that work, however, he said that Mr. Molison was “dishonest, incompetent, and failed to perform the work in a good and workmanlike manner.”  Mr. Niedermayer also claimed “breach of trust and unjust enrichment”, by which he meant that Mr. Molison had been enriched by charging certain supplies to Mr. Niedermayer’s RONA account without his knowledge or permission.  He specifically claimed that Mr. Molison had “fraudulently stolen misappropriated goods by ordering them from suppliers and charging them to [Mr. Niedermayer]” and “converting the goods” to his own use without Mr. Niedermayer’s authorization.

[4]           Mr. Niedermayer filed a Counterclaim seeking damages of $46,381.94 for breach of contract, negligence, fraud, conversion of goods and unjust enrichment.  The particulars included “fraud, theft, misappropriation and conversion”, unjust enrichment, “stolen windows”, cost to replace windows, siding, ledger boards, temporary siding, additional costs for “second batch of windows”, damage to the roof causing it to leak, roof repair and wall repair.  In March 2013 Mr. Niedermayer claimed he intended to apply to transfer this claim to Supreme Court as his counterclaim was greater than the small claims court jurisdiction, but then failed to do so for eight months, with the result that this matter was eventually tried in Small Claims Court.

[5]           At the start of trial Mr. Niedermayer also claimed that Mr. Molison “took off” before the Project was finished.  He also asserted that he expected Mr. Molison to cover the costs of materials for the Project because “contractors always do that.”  Mr. Niedermayer said that he had not paid Mr. Molison anything and would not do so until the job is done completely and properly.

[6]           In final submissions, Mr. Niedermayer conceded Mr. Molison did not cause the roof damage and leaking that he claimed in his Counterclaim. To the surprise of all, he then admitted that there was a contract between himself and Mr. Molison by which he agreed to pay Mr. Molison $15,000.00 for labour for the Project; however, he sought to set off $12,650.00 against that amount for labour costs to finish the windowsills and trim, fix the windows, and do mudding and taping, all of which he said was part of the job but not finished.  He made no submissions with respect to replacement of “improperly installed” siding nor replacing the windows as claimed.

[7]           The parties disagree about when the Project was to commence and why it did not commence until September.  The issue of timing is important, because, due to time constraints certain choices about materials and Project priorities were made which are now at issue in this litigation.

[8]           Mr. Niedermayer claims that Mr. Molison had “four months” to complete the Project, but had not completed it by the time of the bank inspection at the end of October 2012.  Mr. Niedermayer claimed he began discussions with Mr. Molison in May 2012, before he went to Europe, and one of his complaints is that he had to chase Mr. Molison all summer to get him to do the job.  Mr. Molison said that he began to speak with Mr. Niedermayer in June 2012, after Mr. Niedermayer had returned from a visit to Europe, about Mr. Niedermayer’s plan to do some renovations at the house.

[9]           It is clear from Exhibit 4, the Buyer’s Statement of Adjustments with respect to Mr. Niedermayer’s purchase of the house, that Mr. Niedermayer did not have possession until June 20, 2012.  Also in evidence is a “chat” dated June 7, 2012 from Mr. Niedermayer to Mr. Molison saying:

[10]        Mr. Molison wrote back suggesting they talk when Mr. Niedermayer returns and Mr. Niedermayer agreed to do so.  However, it would appear that Mr. Niedermayer had still not responded by June 15, because Mr. Molison texted him that day, saying “let me know when you’re back in Bro I come c u.”

[11]        Accordingly, I do not accept Mr. Niedermayer’s evidence that he discussed the renovations to the Property with Mr. Molison in May, because his text dated June 7th is obviously an introduction to the subject and, contrary to his assertion that he had to chase Mr. Molison, it is clear that Mr. Niedermayer had not responded to Mr. Molison about it by June 15^th.  I do not accept that Mr. Niedermayer expected the work to occur in June because he did not even own the Property until June 20, 2012.  Mr. Niedermayer also complained that Mr. Molison did not commence work in July, but it is clear from the text messages that went on between the parties that by mid July 2012, Mr. Niedermayer was still considering choices as to the style of windows.

[12]        On August 4, 2012, Mr. Molison texted Mr. Niedermayer indicating that he was still working on his “costs” and Mr. Niedermayer responded that the job had to be finished near the end of August or “they” [the bank] would not release the money for his renovations to him.  (I find that text be disingenuous, because the actual deadline appears to have been the end of October 2012).  On August 9, 2012 Mr. Molison responded to Mr. Niedermayer’s suggestion that he would seek to obtain a $10,000.00 draw from the bank to commence the work, as follows:

[13]        Mr. Molison asked to have the money released in draws upon completion of stages so that he could pay his crew as the work proceeded.  Mr. Niedermayer claimed that the bank refused to do that, something I find rather odd, given the funds were made available specifically for a renovation Project.

[14]        By text on August 9^th, Mr. Niedermayer texted Mr. Molison stating that the bank suggested he find someone to do the Project who was prepared to carry the costs of it and Mr. Molison replied that he did not know any contractor that would do that, but suggested opening an account at RONA to cover the materials costs.

[15]        It was not until August 24th that Mr. Niedermayer stated that he was going to RONA to talk to them about setting up an account. Mr. Molison confirmed with him that no materials could be ordered until the account was set up.  On August 28th, Mr. Niedermayer texted Mr. Molison that he had set up an account and that Mr. Molison’s name was on it too.  However, on September 4th he texted Mr. Molison that he may have to cancel the renovations because RONA only gave him a $5,000.00 limit, which was “completely useless.”  Mr. Niedermayer then asked Mr. Molison how much the expenses would be.  Mr. Molison replied that although the materials would probably cost between $13,000.00 and $14,000.00, an account of $16,000.00 would be “for sure” enough for materials and Mr. Niedermayer responded “okay cool bro thanks I’ll get it all straightened out.”  On September 5th, Mr. Niedermayer confirmed that RONA agreed to provide an account for materials in the amount of $16,000.00.

[16]        Mr. Molison testified that he understood that Mr. Niedermayer’s bank required that the renovations be completed by the end of October 2012, in order to receive the payout of the mortgage funds allocated for the renovation.  He had hoped to work on the Project in August and had been obtaining quotes on windows for the Project. However, he was not prepared to finance the purchase of the materials for Project personally and accordingly it could not commence until Mr. Niedermayer made those arrangements.

[17]        Mr. Niedermayer now claims that Mr. Molison should have personally financed not only the labour but also all of the materials required for the Project, without any payment, advance, or contribution by Mr. Niedermayer, and should have done so by the beginning of August.  However, the text messages clearly state that when Mr. Niedermayer said the bank told him to “find someone that can carry the costs” Mr. Molison said he did not know any contractor that would do that and specifically said he could not do that.  It is abundantly clear from the contemporaneous text messages, that the parties had no such agreement.

[18]        Mr. Niedermayer also asserts that it is industry standard for contractors to carry Project costs, but he has produced no evidence to support that contention.  I do not accept Mr. Niedermayer’s assertion that the financing of the Project was the responsibility of Mr. Molison.  To the contrary, it is clear that Mr. Molison refused to finance the materials and Mr. Niedermayer’s claim to the contrary is simply false.

[19]        In view of the foregoing, I am of the view that all delays in the commencement of the Project to that point were due to Mr. Niedermayer’s failure to make the proper arrangements to purchase the materials for the Project.  The delay in commencement of the Project meant that there was very little time left between September 5th and October 31st, the financial inspection deadline.  As often happens with construction projects, there were unexpected problems, as a result of which certain compromises regarding the windows and siding were made.  Mr. Niedermayer seeks compensation from Mr. Molison with respect to those compromises.  However, since Mr. Niedermayer’s failure to obtain financing to purchase materials was the cause of the time pressure, I am of the view that he should bear the burden of the choices that were made to accommodate the problem he created.

[20]        The Project involved changing the windows, some doors and siding at the house. Mr. Molison gave evidence that he and Mr. Niedermayer discussed what the Project would cost.  Mr. Molison was aware that Mr. Niedermayer was obtaining financing from his lender in order to pay for the Project.  Mr. Molison says that Mr. Niedermayer told him the amount of the financing was $28,000.00.  Mr. Molison testified that he estimated that the materials would cost approximately $14,000.00 and that the labour would use up the remaining $14,000.00.  After the Project was underway, it became apparent that one of the garage walls was rotten and would have to be rebuilt.  Also Mr. Niedermayer wanted his bedroom window reframed in such a way that he could later install a patio door.  There does not appear to be any dispute between the parties that these items were “extras” and would cost $1,000.00.

[21]        Mr. Niedermayer claimed in his Reply and Counterclaim, and in his evidence before me, that there was no discussion at all about what the Project would cost and claims that he repeatedly asked Mr. Molison for a quote but never received one. Nevertheless, he acknowledges that Mr. Molison and his crew did work on the Project with Mr. Niedermayer’s full approval and direction.  Much time was taken up in court with evidence on both sides of the question of whether Mr. Molison was to be paid on the basis of an agreed contract price or on the basis of quantum meruit, which simply means Mr. Molison would be paid for the value of the work done.

[22]        Because Mr. Niedermayer insisted that there was no agreement, that the cost of the labour would be $15,000.00, much time was spent in evidence seeking to establish the value of the work done.  In fact, an extra day of hearing was required so that the parties could obtain quotes with respect to the value of the work done.  Mr. Niedermayer made repeated assertions that the work done by Mr. Molison was worth less than the $15,000.00 claimed but paradoxically also asserted that the cost merely to finish the job was $12,650.00.  He did not provide the Court with any quotations from anyone indicating that the work performed was worth less than $15,000.00.

[23]        Mr. Molison gave evidence as to the number of labour hours at varying rates that were spent on the job which places the labour at an amount I calculate to be in excess of $15,000.00.  Mr. Molison went to the effort of finding another contractor to provide an estimate of the labour required to do the work that Mr. Molison had done.  That quote from Bunce Contracting states the value of the work done to be $26,732.00 plus tax, for a grand total of $29,939.84.  That quote would seem to corroborate Mr. Molison’s evidence that the price he charged for the work was well below market value and that the price given to Mr. Niedermayer was discounted on the basis that Mr. Niedermayer was his friend.  However, in his closing submissions, Mr. Niedermayer said that “he doesn’t have a leg to stand on” concerning the contract price for the labour and conceded that the labour for the Project was agreed at $15,000.00.

[24]        Since it would appear that Mr. Niedermayer now concedes that there was an agreed contract price and that the price was $15,000.00 for labour, I find that there was an agreement to perform the labour on the Project for that amount.  However, I am also satisfied on the evidence before me, that the value of the work done was considerably more than $15,000.00.

[25]        Mr. Molison says that he agreed to replace the siding on the house and to change the windows and some of the doors on the house.  He said that Mr. Niedermayer wished to keep costs down so the agreement was that he would not install trim for the windows and he would only do mudding and taping, not finishing.  When he and his workmen discovered that the garage wall was rotten, it was agreed to reframe the garage wall.  Additionally, Mr. Niedermayer requested that his bedroom window be reframed so that he could put in a patio door at some future time.  The parties agreed that the cost for additional labour required for these extras would be $1000.00, for a total of $15,000.00 for labour.  Although later problems with the windows required that other window openings be reframed, Mr. Molison did not, and does not, seek additional compensation for the additional labour required.

[26]        Mr. Niedermayer claims that the price included the finishing work around the windows, that is, the window returns (windowsills) and trim and insulation.  Mr. Molison agrees that he was to install insulation around the windows, but claims that he did so and that the insulation was done when he left the job.  He conceded that the insulation installed around the windows is certainly missing in the photos provided by Mr. Niedermayer, and testified that the cost to install, or re- install it would be $2.00 per window.  He says there was no agreement to do the window returns with drywall because Mr. Niedermayer told him he intended to have all the returns and trim made out of wood after he did new floors in the home.

[27]        On this point, I accept the evidence of Mr. Molison.  I have examined the photographs provided by Mr. Niedermayer which show the windows and drywall.  If completion of drywall returns around all windows had been agreed between the parties, but simply not yet completed before they parted ways, I would have expected to see some of the window returns completed as it would make sense to complete the installation of drywall returns around each window before moving on to the next.  However, it is clear that the dry walling is complete around all of the windows, but none of the windows have drywall returns for the windowsills. It seems to me that if it had been agreed between the parties that the window returns were to be done with drywall that Mr. Niedermayer would have noticed and complained, as the job progressed, that none of the returns were done despite the completion of all the other drywall around all of the windows.  There is no evidence before me that he did so.  I infer, therefore, that the absence of drywall returns around the windows was, as Mr Molison testified, by agreement of the parties.

[28]        Mr. Molison testified that after the inspection occurred he texted Mr. Niedermayer about whether the Project had passed, expecting to receive payment for the work done thus far.  The exchange between them is largely contained in the text messages they sent to one another.  Mr. Niedermayer confirmed on October 31, 2012 at 11:05 pm that it [the Project] had passed inspection and the following morning asked when the remaining siding was coming in from the supplier.  Mr. Molison responded that it had come in the previous day, but he was waiting for the payment to come in so he could “bang out the rest of your job this weekend.”  Mr. Niedermayer asked what cash had to do with finishing “the last little bit” and Mr. Molison explained at length that he and his workmen needed to be paid, including that he had had to borrow money to buy food.

[29]        Mr. Molison asked on November 2nd to be informed when the funds came in and Mr. Niedermayer told him that day “not yet”.  On Saturday, November 3rd Mr. Niedermayer again texted Mr Molison claiming that he had “no cash until the lawyer gets a hold of [him]”.  These representations by Mr. Niedermayer were false: he had received the renovation funds from his bank already.

[30]        Mr. Molison worked on preparing a final invoice for Mr. Niedermayer, in particular working out which items charged to the RONA account were for his own account rather than the Project, as well as attempting to ensure that Mr. Niedermayer was not overcharged for materials which RONA supplied late or incorrectly.  He went to the house to pick up leftover materials (including the windows that didn’t fit) to return them to RONA.  When he arrived at the Project, he entered using the key he had been given and found his own tools moved and locked up inside the house and his level was propped against the front door to barricade the door, as seen in the photograph he took entered as Exhibit 2.  Mr. Niedermayer admitted in Court that he had taken Mr. Molison’s tools and barricaded the door intending to lock Mr. Molison out, without telling Mr. Molison that he was no longer welcome in the house.

[31]        In any event, Mr. Molison entered with the key he had been given.  He found a letter in the kitchen addressed to Mr. Niedermayer which made it clear that Mr. Niedermayer had lied to him about not receiving funds from his lawyer.  Exhibit 3A is a photograph of a letter dated November 1, 2012 from Traxler Haines, barristers and solicitors to Mr. Niedermayer, which states:

[32]        At that point Mr. Molison picked up his tools, as well as the leftover materials and windows to return to RONA.  Those returns amounted to $7,539.23.  However, when he got to RONA, he discovered that Mr. Niedermayer had put a hold on his RONA account with the result that the returns would not be accepted by RONA.  Mr. Molison texted Mr. Niedermayer seeking instructions and Mr. Niedermayer told him to leave them at RONA, and did not respond when he was informed that RONA would not accept them back unless Mr. Niedermayer released the hold on the account.  (Mr. Niedermayer did not in fact release the hold until shortly before the trial began in 2014, but as soon as he did so, the returns were credited to his account, as he acknowledged in Court.) 

[33]        At that point it was clear that the relationship between the parties, contractual and otherwise, had broken down.  Mr. Molison texted Mr. Niedermayer repeatedly over the next few days in an effort to get paid so that the Project could be finished, including offering a holdback of $1,000.00 to ensure completion of the last few details.  Mr. Niedermayer eventually responded that Mr. Molison would not get a cent until the Project was “done” despite the fact that Mr. Niedermayer admitted in his testimony that he had locked the house up with Mr. Molison’s tools inside specifically intending to lock Mr. Molison out of the Project.

[34]        By locking Mr. Molison out of the Project, Mr. Niedermayer intended to prevent Mr. Molison from completing the “last little bit” that was left to be done on the Project; I therefore find that Mr. Niedermayer repudiated the contract between them and relieved Mr. Molison of any obligation to complete further work on the Project, as of November 2, 2012. 

[35]        It is also clear that the Project was substantially complete at the time that it was inspected and that as a result Mr. Niedermayer’s bank released the funds to pay for the Project.(As I noted above, Mr. Niedermayer himself characterized the remaining work as “that little bit”).  I find, therefore, that the Project was substantially complete as at the date of inspection.  Although it is apparent that the parties did not formally agree what precise event would trigger the timing of payment for the work, it is clear that Mr. Molison had been expecting draws throughout the Project and had been put off by various assurances by Mr. Niedermayer that he would be paid when money came in from the bank.  When those funds were released to Mr. Niedermayer because the Project was “Complete” to the satisfaction of the bank, Mr. Niedermayer was obliged, in my view, to pay Mr. Molison for his labour to that point.  His refusal to do so was a breach of the contract between them.  

[36]        Mr. Niedermayer claims “the claimant fraudulently ordered goods for himself from a building supplier and charge the price of the goods to the defendant without the defendant’s authorization.”  The evidence from Mr. Molison was that he had the permission of Mr. Niedermayer to charge certain items to Mr. Niedermayer’s RONA account, particularly because Mr. Niedermayer had not advanced him any funds for his work on the Project.  The following text messages are pertinent:

[37]        This offer from Mr. Niedermayer for Mr. Molison to use his account is in direct response to Mr. Molison’s request to have a cash advance to pay for labour.  Clearly the use of Mr. Niedermayer’s account is intended to assist Mr. Molison with personal cash flow otherwise the offer to use the account makes no sense.  In my view, it is absolutely clear from these text messages that Mr. Molison did have authorization to charge items of his own to Mr. Niedermayer’s account.  Accordingly, I find that Mr. Niedermayer has not proved this allegation of fraud on the part of Mr. Molison and, in fact, the text messages make it clear that Mr. Niedermayer made these allegations of fraud knowing they were false.

[38]        Mr. Molison has examined the RONA account and he testified that he charged $2,365.91 worth of materials to Mr. Niedermayer’s account and he says that should be deducted from what he is owed.  Mr. Niedermayer was not satisfied with that amount but he did not establish for me any basis for a finding that the calculations were incorrect or that some other figure was correct.  I accept that the sum of $2,365.91 was charged to Mr. Niedermayer’s account by Mr. Molison and that amount will be deducted from his claim.

[39]        Mr. Molison was unable to order the windows for the Project until Mr. Niedermayer arranged financing for the purchase of materials.  The window order was placed with RONA on Sept 4, 2012.  They did not arrive until Sept 28^th.  On October 1st, Mr. Molison discovered that the windows were the wrong configuration, a fact for which he takes responsibility.  There was not time to re-order from the same manufacturer before the financial inspection deadline.  So Mr. Molison went around to various window suppliers and found some to substitute that were slightly different, by a different manufacturer.  They were also less expensive.  He texted this information to Mr. Niedermayer.  Mr. Niedermayer’s response was “Ok cool, no worries then.”  Mr. Molison also sent photos of the new windows by text to Mr. Niedermayer, who responded “Just got that pic bro it looks fine to me.”  Ultimately Mr. Niedermayer retained three windows from the original batch and the remaining windows were chosen from the new batch located by Mr. Molison.  Mr. Molison was obliged to reframe several of the window openings to accommodate the new windows, which cost extra labour for which Mr. Niedermayer was not charged.

[40]        I find that Mr. Niedermayer accepted and approved the changes to the windows. Those changes were necessary because Mr. Niedermayer failed to obtain financing for the Project within a reasonable time prior to the financial deadline imposed by his bank - something for which he alone was responsible.  Mr. Molison took responsibility for having ordered the windows in the wrong size and he rectified that error to Mr. Niedermayer’s satisfaction, as is clearly established in the text messages.  I find, therefore, that Mr. Niedermayer has not suffered any loss with respect to the changes in the windows.

[41]        Mr. Molison agreed to install new vertical siding on the exterior of the house.  In one area, some siding was placed on the house that did not match the remainder, because insufficient siding was shipped, due to an ordering error at RONA.  It was necessary to have the house completely closed in prior to the inspection by the bank.  So Mr. Molison installed horizontal siding instead and agreed to replace this portion of the siding when matching siding became available.  When Mr. Niedermayer locked Mr. Molison out of the Project, the matching siding had not yet been installed.

[42]        Despite being prevented from completing that work by the actions of Mr. Niedermayer, Mr. Molison maintains that he had agreed to replace that siding for no additional cost to Mr. Niedermayer and is prepared to make good on that now.  He states that it will take a half day’s work to replace the siding, a value of $400.00.  He offers that deduction from his claim.

[43]        Mr. Niedermayer has not provided any evidence as to the cost of removing that siding and replacing it.  I find that the quotes he provided in his materials are unhelpful because they go far beyond the scope of the work he contracted with Mr. Molison to do.  I therefore accept the evidence of Mr. Molison on this point.  I find that the value of that deficiency is $400.00.

[44]        Mr. Niedermayer also complains that the siding and trim are not the colours he preferred.  The siding he wanted would have taken too long to arrive to be installed prior to the bank deadline.  That time pressure was created by Mr. Niedermayer and he must live with the choices he made as a result.  His text messages confirm that he specifically ordered “Siding - kaycan, flagstone; trim - kaycan white” which is what he got.  There is no merit to this deficiency claim.

[45]        Mr. Molison says that the mudding was part of the job which was to be done, naturally, at the end.  He was unable to finish it because he was locked out of the Project by Mr. Niedermayer.  Mr. Niedermayer complains that there is very narrow cut about the width of a breadknife through the drywall near the front door which must be repaired.  He says that the cut punctures the vapour barrier and can only be repaired by removal of the drywall, replacement of the vapour barrier, and re-dry walling and finishing.  Mr. Molison agrees the cut was caused by his workman and he says it can be repaired by applying drywall mud to the area.  He says that the cut through the vapour barrier at that point is of no consequence because the drywall is placed solidly against the header above the door at that point and no moisture can enter there.  Mr. Niedermayer did not provide any witness with expertise in this area to contradict Mr. Molison and I accept Mr. Molison’s evidence on this point.  He is prepared to have a deduction from what is owed to him to repair it.

[46]        Mr. Molison concedes that some of the drywall work in the garage is not up to his standard.  He says the cost to repair that drywall, both labour and materials, is $75.00 and he is willing to have that deducted from what is owed to him.

[47]        Mr. Niedermayer complains that the drywall mudding has not been completed in the areas where drywall was installed.  As I have found, that was the fault of Mr. Niedermayer, because he breached their contract by locking Mr. Molison out and refusing to pay him when the Project was substantially complete.  Nevertheless, Mr. Molison agrees that this work was to be included in the contract price.  He says that the value for all the mudding, (including the area near the front door) is $600.00 and he is willing to have that deducted from what is owed to him.

[48]        Mr. Niedermayer has complained that some of the windows have been installed with insufficient room around them to allow for movement and insulation.  He acknowledges that they all open and close, although he claims one does not close completely.  Mr. Niedermayer admits he has no particular knowledge or expertise about window installation and he did not provide any witnesses to provide evidence to me to assist with establishing his claim that they are improperly installed.  I have examined the photographs and the windows appear to be functional to me.  Mr. Molison says that the windows were installed correctly and that they function normally.  There is no independent evidence on this point one way or the other.

[49]        Mr. Niedermayer claims that insulation was not placed around the windows.  Mr. Molison says that the insulation was put in place when he left, but acknowledges that it is clearly missing from around the windows shown in the photos provided by Mr. Niedermayer.  He suggests that someone must have removed the insulation.  In any event, he says that the cost to insulate the windows is $2.00 per window.  There is no independent evidence on whether the windows were insulated, one way or the other.

[50]        In deciding this issue, I take into account that it is clear from the text messages that Mr. Molison was forthright and honest in his dealings with Mr. Niedermayer during the Project and he impressed me in the same fashion in his conduct at trial by in his willingness to concede his mistakes or errors of workmanship throughout the trial.  By contrast, it is apparent that Mr. Niedermayer misled or outright lied to Mr. Molison throughout his dealings with him on the Project and continued to make assertions during the trial which he later conceded or were proved to be groundless.  Given that Mr. Niedermayer’s assertions have all proved to be false wherever independent evidence is available, I am inclined to prefer the evidence of Mr. Molison wherever it conflicts with that of Mr. Niedermayer.  Accordingly, I accept the evidence of Mr. Molison that the windows were installed correctly and that they were insulated when he left the Project.

[51]        Mr. Niedermayer complains that the “J- Strip” at the bottom edge of the vertical siding was installed incorrectly and is crooked.  He has provided photos that show that the J-Strip appears crooked in one area, in photos taken in March 2014.  Mr. Molison says he installed the J-strip correctly and that it was perfectly straight when he left the job.  He has provided photos that clearly show that the J-Strip in that same area was straight when it was installed in October 2012.  It may be that it has settled in the two winters that have passed since its installation.  I have considered the photos and evidence presented by both parties and I find that I am not satisfied that Mr. Niedermayer has established that the J-strip was installed incorrectly.

[52]        Mr. Niedermayer filed a Counterclaim.  In that Counterclaim he repeated many of the claims he made in his Reply.  The deficiency claims were addressed already in arriving at the appropriate amount owed to Mr. Molison for his claim, and it is not proper to  claim them twice - that  is, once in the Reply and again in the Counterclaim.  It now remains to be decided whether Mr. Niedermayer has substantiated the claims and additional damages he claims in his Counterclaim.

[53]        Those claims appear to be:

[54]        The summary of costs and damages includes the following additional claims:

[55]        As I mentioned earlier, this Counterclaim duplicates a number of the complaints made in the Reply.  With respect to the items to be deducted from Mr. Molison’s claim, such as the RONA account, the work that had yet to be finished at the time the Mr. Niedermayer repudiated the contract (mudding and taping and replacement of a portion of siding), they have been addressed in the context of the Claim and Reply.

[56]        With respect to the balance of the claims contained in the Counterclaim, I have found that they are entirely without merit.

[57]        It is in that context that I have considered Rule 20(5) of the Small Claims Rules which provides that a penalty of up to 10% of the claim or counterclaim (as the case may be) may be imposed on a party who proceeds through trial with no reasonable basis for success.

[58]        I note that the amount claimed was $46,381.94 and that Mr. Niedermayer stated in the claim that he “does not waive his Counterclaim for amounts over $25,000.00 and will apply to transfer this action to the Supreme Court of British Columbia.”  The Court record from the Settlement Conference occurring March 25 2013 indicates the matter was adjourned specifically for Mr. Niedermayer’s counsel, Mr. Nicholson, to apply to transfer this matter to Supreme Court.  However, Mr. Niedermayer never, in fact, made any application to transfer this matter to Supreme Court.  I also note Mr. Molison’s evidence that he was so poverty stricken as a result of Mr. Niedermayer’s refusal to pay him for his work that he and his family were forced onto social assistance.  I infer from that evidence that Mr. Molison does not have the resources to retain counsel to represent him in Supreme Court.  A suspicious person might infer that this unfounded, very large counterclaim was filed for no other purpose than to intimidate Mr. Molison into giving up his Claim altogether rather than face a Supreme Court trial without a lawyer.

[59]        Regardless of the motivation, the result of filing this unfounded Counterclaim was a delay of approximately a year in bringing this matter to trial, thus dragging out the hardship imposed on Mr. Molison and his family by Mr. Niedermayer’s breach of contract.

[60]        I take particular note that the allegations of fraud, theft, break and enter and misappropriation against Mr. Molison, are not only found to be without merit, but it is clear that they were known to be false at the time that they were alleged.  In fact, it was Mr. Niedermayer who lied to Mr. Molison about the release of the construction funds and he admits he took Mr. Molison’s tools while attempting to lock him out of the house - which is theft.  I note that this dishonest behaviour on the part of Mr. Niedermayer appears to be a pattern; throughout the Project, every time Mr. Molison asked for some cash to pay for labour, Mr. Niedermayer put him off, saying things like “no worries” or deflecting the text conversation to some other topic.  It seems to me that a fair inference from this behaviour, when combined with Mr. Niedermayer’s failure to pay anything at all for the work and his trumped up Counterclaims, is that Mr. Niedermayer intentionally abused the trust placed by Mr. Molison in his friendship and never had any intention to pay Mr. Molison.  Never has it been more truly said, “with friends like that, who needs enemies.”

[61]        I am satisfied that Mr. Niedermayer filed this Counterclaim and proceeded to trial with no reasonable basis for success.  In view of the aggravating factors I have noted above, I am of the view that the penalty should be 10% of the Counterclaim.  However, given that the jurisdiction of this Court caps such a claim at $25,000.00, I am of the view that the maximum penalty I can properly impose is $2,500.00.  I therefore impose that amount.

[62]        For the reasons stated above, I find that there was a contract between Mr. Niedermayer and Mr. Molison that Mr. Molison would replace the windows and siding on the house and rebuild the garage wall and that Mr. Niedermayer would pay him $15,000.00 for his labour.  Mr. Molison had substantially performed the contract when Mr. Niedermayer breached the contract by locking him out of the Project and refusing to pay him anything for his work.  Mr. Molison charged certain items to Mr. Niedermayer’s account (with permission) and has admitted certain deficiencies and these will be deducted from the contract price.  I have also assessed a penalty of $2.500.00 against Mr. Niedermayer for the reasons stated above.  The breakdown of these amounts is as follows:

[63]        Mr. Molison is also entitled to prejudgement interest on $11,559.09 from November 2, 2012, the date that Mr. Niedermayer breached the contract between them, as well as filing fees and service fees.  I further direct that Mr. Niedermayer will pay the amount due to Mr. Molison forthwith.