Assignment 1 - Sample Case Brief

Spectra Architectural Group v. St. Michael’s Extended Care Centre Society, [2002] A.J. No. 565 (Alta. Q.B.)

Facts:

  1. St. Michael’s Extended Care Centre Society (“St. Michael’s”) hired Spectra Architectural Group in 1985 to develop the conceptual design of a 68 unit senior citizens lodge.
  2. The work was to be performed pursuant to a standard R.A.I.C. Client-Architect agreement.
  3. St. Michael’s authorized Spectra to proceed with architectural services on June 29, 1988.
  4. There was an addendum to the agreement in August 10, 1998.
  5. There were two terms to the contract:
  6. The fees for basic architectural services were fixed,
  7. Compensation for additional services were to be negotiated or calculated based on hourly rates in the contract.
  8. The relationship broke down and on May 5, 1989 St. Michael’s gave notice to Spectra that the contract was terminated.
  9. Spectra sued, claiming additional compensation for:
  10. Changes made to the drawings before the construction tenders;
  11. Compensation for expenses incurred at the time of termination of the contract;
  12. Termination payment.
  13. St. Michael’s counterclaimed, alleging breach of contract and negligence.

Issues:

  1. Whether Spectra performed work additional to its contract.
  2. Whether Spectra was entitled to additional fees for the additional work, if any.
  3. Whether Spectra had incurred additional costs due to changes to the work.
  4. Whether Spectra had incurred additional expenses.
  5. Whether Spectra was entitled to a termination payments.

Law

  1. The base contract was a very general contract for architectural services.
  2. With respect to compensation for additional services, the court found that notwithstanding entitlement, the claimant must maintain proper documentation of costs incurred. Further, any claim for additional compensation must be for work that advances the project.
  3. The Lien Act provides that a person filing an invalid or excessive lien shall pay the costs associated with that lien.

Analysis

  1. Spectra claimed for work on the Lodge and Tunnel link, which was mentioned in the base contract. Since it was mentioned there, the Court ruled that all work involved was part of the base contract.
  2. Spectra claimed for the expense of producing “slicks” for the subsequent architect; St. Michael’s had requested mylar prints. Since the “slicks” did not advance the subsequent work, the claim was denied.
  3. Spectra claimed for additional hours spent working on extra work. Spectra attempted to document this additional cost by “estimates”. The court found that only costs substantiated by proper time records could be claimed.
  4. When interpreting the contract, the Court took a very broad view of “basic services” in it and would not consider additional compensation for evaluation of building materials and equipment.
  5. The Court found that the termination clause in the Contract was enforceable even if Spectra was found at fault.

Conclusion

  1. Spectra did not receive compensation for the three (3) cases where Spectra proved entitlement for additional work because their documentation was inadequate.
  2. Spectra did not receive compensation for the “slicks” since they did not advance the work.
  3. Spectra received compensation in accordance with the termination clause.
  4. Spectra was penalized for grossly overstating its lien claim by having to pay a pro-rata portion of the costs of the letter of credit needed to remove the lien.