“THE HIGH COST OF REMEDIATION” – The Importance of Having Clear and Transparent Communication on Fees

30. September 2019 0

The decision of A Speedy Solutions Oil Tank Removal Inc. v. Garraway, 2019 BCSC 1091 provides remediation companies along with both sellers and purchasers of properties alike with an important and timely reminder of the need for clear and transparent communication with respect to fees and how professional services will be charged.

At its core, this case involved a contractual dispute for fees associated with the removal and remediation of contaminated soil at a property.  In it, A Speedy Solutions Oil Tank Removal Inc. claimed against Ms. Garraway, a property owner, for the contract price of removing and remediating contaminated materials from her former property in Burnaby, which amounted to $166,702.73.

Speedy’s excavation and remediation of the contaminated soil, along with its restorative landscaping of Ms. Garraway’s lot were not in dispute; instead, what was in contention was the cost of the work undertaken by Speedy, and more specifically, whether the performance of the contract amounted to a consumer transaction that was unconscionable pursuant to the Business Practices and Consumer Protection Act.

The evidence showed that Speedy told Ms. Garraway that it would charge a flat rate fee that was dependent upon the amount of tonnes of soil that was removed from the site, which was exclusive of costs relating to environmentalist fees, bioremediation, contaminated water disposal (charged per litre), removing and replacing fences and gardens (as the contamination had migrated onto neighbouring property) and the hourly rate for additional labourers.

Despite Speedy’s awareness of Ms. Garraway’s sensitivity to cost and her repeated inquiries during the performance of the work for an estimate, none was ever provided until the work was completed months later at a total cost of $166,702.73.  In order to dispute the reasonableness of Speedy’s invoice, Ms. Garraway submitted a report authored by a senior environmental engineering expert, who opined that the true cost of performing the work was $80,000 and that furthermore, core testing could have been performed in order to determine the extent and spread of the contamination on the property, the results of which would have assisted in estimating the scope of work and ultimate cost.

Following an assessment of the evidence, the Court ultimately held that the contract between Speedy and Ms. Garraway was, in fact, an unconscionable consumer transaction between parties of inequitable bargaining power and as a result, ordered that the contract be set aside and limited Ms. Garraway’s obligation to Speedy for the performance of the work to $80,000, which the court believed was a fair estimate given the expert evidence on what the actual cost of the work was.

Therefore, the conclusions reached by the court in the Speedy Solutions decision serves as a timely reminder on the importance of ensuring that there is clear and transparent communication between transacting parties with respect to professional fees, lest unequitable consumer transactions potentially attract intervention by the courts.

 

Questions? Comments? Concerns? Contact Andrew Tang at atang@harpergrey.com or anyone else from our team listed on the Authors page.

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