Executive Summary: Key Legal and Evidentiary Issues

• Characterization of the March 5, 2025 email: whether it amounted to a formal “finding” by the construction manager under GC 2.2 and GC 8.2.2 of the CCDC 17 contract, triggering a 15-working-day deadline for a Notice in Writing of dispute.
• Interpretation and application of the contractual notice regime, including the defined term “Notice in Writing” and Article A-7 on addresses and methods of delivery, in determining if Integrum complied with GC 8.2.2.
• Distinction between settlement-oriented communications and a binding contractual “finding,” and whether BANC’s “effort to resolve all this” correspondence could fairly be treated as an adverse decision on the delay claim.
• Use of estoppel to prevent BANC from later re-characterizing its negotiation-framed communications as a “finding” once it believed the 15-day period had expired.
• Impact of prior case law (e.g., Arguson, IWK, Lorneville, Install-A-Floor) on strict versus flexible enforcement of contractual ADR timelines and waiver provisions in construction contracts.
• Consequences for the status of Integrum’s delay claim and access to ADR/court: the Court held the claim remains extant, and that BANC’s conduct deprived Integrum of a fair opportunity to trigger mediation and possible arbitration without waiving its rights.

Factual background and parties

The dispute arises from a construction project at 5858 Macara Street in Halifax, Nova Scotia, where Integrum Painting, operated by Shaun Graham, was retained to perform interior painting on a new Elevation building. Integrum contracted with 5858 Macara Street Limited under a standard form CCDC 17 Stipulated Price Contract dated April 25, 2023, for painting services on the project. 5858 Limited, whose principal was Alex Halef, later amalgamated with BANC Investments Limited in January 2024, and BANC became both owner of the building and successor to 5858 Limited’s rights and obligations under the contract. The contract identified 5858 Limited as both “Owner” and “Construction Manager,” and provided Mr. Halef’s contact information as the email address for notices in both capacities. There was no separate consultant designated under the contract. Integrum alleged that work on the building began on November 13, 2023, and that it encountered significant delays on the project. In response, on November 26, 2024, Integrum’s counsel wrote to Mr. Halef on a “without prejudice” basis, asserting a claim for delay costs and proposing settlement at $68,750 plus HST in exchange for a full and final release, following calculations of lost opportunity on other units. BANC did not counteroffer or engage substantively on the claim, but on December 6, 2024, BANC’s counsel requested documentation supporting the allegations of delay and quantum; Integrum’s counsel supplied particulars on January 3, 2025. As physical work on the Elevation project was drawing to a close in winter 2025, discussions shifted to the release of holdback funds. In February 2025, Mr. Halef met with Integrum’s partner, Glenda Mercer, a former BANC employee. According to Ms. Mercer’s affidavit, he pressed Integrum to drop the delay claim and suggested BANC would drop its deficiency claims and pay Integrum’s contractual amounts and holdback if the delay claim were abandoned. Mr. Halef disputed parts of this account but acknowledged telling Ms. Mercer that the delay claim lacked contractual merit and that he was the person responsible for verifying contract compliance.

Key correspondence and emerging dispute

On March 4, 2025, despite having counsel, Mr. Halef personally wrote a “without prejudice” email directly to Integrum’s counsel, copying his own counsel. In that email, he asserted that holdback monies were not owed because the invoice was premature and substantial completion had not been met. He raised alleged “hundreds of hours of deficiency work” done by others to fix Integrum’s work, indicated there might not be enough money left under the contract to cover those deficiency costs, and stated he was “happy to consider a comprehensive resolution of all issues,” including orderly payment of holdback, but warned that if Integrum insisted on dealing with delay and holdback separately, he was prepared to “vigorously defend” delay and holdback claims while pursuing recovery for deficiencies and rework. The next day, on March 5, 2025, Mr. Halef again bypassed counsel and emailed Mr. Graham directly, leaving all others off the chain “in an effort to resolve all this.” In this central email, he said he disliked holding payments but insisted there were real deficiencies documented with pictures. He asserted that Integrum’s delay claim was “baseless” with “absolutely no merit” from a contractual perspective because there was no written agreed schedule and, in his view, he was the only signing authority. He contrasted Integrum’s alleged evidentiary weakness on delay with his own documentation of rework and then urged Graham, as a fellow business owner, to resolve matters amicably, warning that only the lawyers would win and recounting a previous litigation experience where his counterpart ultimately accepted his initial “walk away” offer after incurring legal costs. On March 11, 2025, Integrum’s counsel replied to BANC’s counsel on a “without prejudice” basis, expressly referencing “Mr. Halef’s email” and characterizing BANC’s stance as an attempt to hold final invoices and holdback “hostage” until Integrum dropped its delay claim. Counsel reiterated that Integrum remained willing to negotiate amicably on the delay claim, with a reasonable settlement to include payment of holdback, final invoices, and a contribution toward delay losses, and asked BANC to state its position on the prior November settlement offer or else a notice of arbitration might be issued. On April 7, 2025, after another request for payment from Integrum, Mr. Halef sent an email repeating, substantively verbatim, the contents and tone of the March 5 email, including his view that the delay claim had no merit and his desire to settle “all this.”

Contractual dispute resolution framework and notice provisions

The CCDC 17 contract placed primary interpretive and dispute-screening responsibility on the construction manager. General Condition (GC) 2.2 required the construction manager “in the first instance” to give interpretations and make findings on matters in question relating to performance of the work or the requirements of the contract documents, except as to architectural and engineering matters and certain financing provisions. Under GC 8.1.1, “differences between the parties” regarding interpretation, application, administration or any failure to agree, which are “not resolved in the first instance by findings of the Construction Manager or the Consultant,” must be settled in accordance with Part 8 – Dispute Resolution. GC 8.2.1 required the parties to appoint a project mediator in accordance with CCDC 40, and GC 8.2.3 obligated them to make all reasonable efforts to resolve disputes by amicable negotiations with frank, candid, and timely disclosure. The pivotal clause was GC 8.2.2, which provided that a party is conclusively deemed to have accepted a finding of the construction manager and to have expressly waived and released the other party from any claims regarding the matter dealt with in that finding unless, within 15 working days after receipt of that finding, the party sends a Notice in Writing of dispute to the other party, the construction manager, and the consultant. That Notice in Writing must contain particulars of the matter in dispute and relevant contract provisions, and the responding party must issue a Notice in Writing of reply within 10 working days. The contract defined “Notice in Writing” as a written communication transmitted in accordance with Article A-7, which set out addresses for notices and permitted delivery by hand, courier, mail, fax, or electronic communication, specifying when notices are deemed received. The contact details for 5858 Macara Street Limited as Owner and Construction Manager both used Mr. Halef’s email address, while Integrum’s address and email were separately specified.

Procedural posture and BANC’s waiver argument

On May 15, 2025, Integrum’s counsel delivered a Notice of Arbitration to BANC, asserting two main claims: unpaid contractual amounts for work performed and holdback, and damages and expenses arising from alleged unreasonable delay on the project for which the respondent was said to be responsible. BANC’s counsel replied on May 21, 2025, contending that the Notice of Arbitration was invalid and non-compliant with the contract. The core of BANC’s position was that the delay claim was no longer arbitrable because it had been “deemed released and waived” under GC 8.2.2: according to BANC, the March 5, 2025 email from Mr. Halef, acting as construction manager, was a “finding” that the delay claim was baseless, and Integrum failed to send a Notice in Writing of dispute within 15 working days. BANC argued that as a result, any claim related to delay had been contractually extinguished. BANC further asserted that the claim for unpaid contractual amounts and holdback was “not yet arbitrable” because, under GC 8, arbitration could only follow failed amicable negotiations and mandatory mediation under CCDC 40. It said any discussion of unpaid amounts had to account for deficiencies BANC was rectifying and associated costs, and that it had asked its client to assemble particulars so that the parties could engage in amicable discussions on “properly outstanding issues.” In response, Integrum’s counsel wrote on May 26, 2025, taking the position that BANC’s May 21 letter was the first formal notice that the construction manager had rejected the delay claim and thus the first indication that a “finding” had been made. He also indicated Integrum’s willingness to proceed to mediation and proposed that both the delay issue and the deficiency/unpaid amounts issues be addressed together. BANC, however, replied on May 28, 2025, disagreeing that delay could be included in mediation, maintaining its view that the delay claim had been waived and released under GC 8.2.2. Against this background, Integrum brought the application in chambers, seeking a declaration that its right to claim for delay remained valid and that BANC must comply with the contract.

Legal issues and authorities applied

The Court framed two main questions. First, whether the March 5, 2025 letter from Mr. Halef to Mr. Graham constituted a “finding” by the construction manager within the meaning of GC 8.2.2 regarding Integrum’s delay claim, such that failure to send a formal Notice in Writing of dispute within 15 working days would bar the claim. Second, if it did constitute a finding, whether BANC was nonetheless estopped from asserting that characterization, given the way the correspondence and negotiations unfolded. A further consequential issue was the present status of Integrum’s delay claim, including whether it could proceed to mediation, arbitration, or court. In analyzing the nature of a “finding,” the Court considered Nova Scotia and other Canadian authorities interpreting similar CCDC dispute-resolution and notice provisions. In Arguson Projects Inc. v. Gil-Son Construction Limited, the Nova Scotia Court of Appeal had held that a contractor’s written communication rejecting a delay claim could constitute a “decision” under a subcontract dispute-resolution clause and that the subcontractor’s failure to provide timely written notice of dispute resulted in deemed acceptance and waiver. Decisions such as Urban Mechanical v. University of Western Ontario and Campbell Construction Limited v. Abstract Construction Inc. likewise enforced mandatory notice requirements strictly when expressed delay or extras claims had been clearly rejected in writing. However, other Nova Scotia cases—IWK Health Centre v. Northfield Glass Group Limited, Lorneville Mechanical Contractors Ltd. v. Clyde Bergemann Canada Ltd., and Install-A-Floor Limited v. The Roy Building Limited—emphasized the importance of the contractual expectation of amicable negotiations and ADR. Those cases held that imperfect compliance with timelines or procedural steps in the ADR clauses did not necessarily strip a party of its right to arbitration, particularly where the other party’s conduct contributed to delay or ambiguity and where public policy supported encouraging cooperative dispute resolution rather than punishing flexibility.

Characterization of the March 5 email and fairness considerations

The judge accepted that a “finding” need not be in any prescribed form or expressly invoke GC 2.2 or GC 8.2.2, but it must, in substance, clearly communicate that the construction manager has decided the particular claim will not be honoured. In Arguson, the decision-making email was understood by the subcontractor as a final determination that the delay claim would not be paid, and the evidence confirmed that understanding. By contrast, the Court found that in this case the March 5, 2025 email could not fairly be read as such a finding. It was framed as an “effort to resolve all this,” explicitly placed outside the usual counsel-to-counsel channel, and coupled with the earlier March 4 “without prejudice” letter proposing comprehensive settlement of “all issues,” including holdback and deficiencies, with an express willingness to negotiate. The email did contain two sentences asserting that the delay claim was “baseless” and lacking contractual merit, but those statements came in the course of advocacy and bargaining—essentially a “settlement position” intertwined with warnings about litigation cost—rather than a clear, formal determination under the contract’s dispute mechanism. The Court emphasized the “draconian consequences” that flow from treating something as a finding under GC 8.2.2: expiration of the 15-day period leads to deemed waiver and release of the claim. Given that consequence, basic fairness required that BANC communicate a finding in a way that would signal to a reasonable recipient that a binding decision had been made and that the clock for a Notice in Writing of dispute was running. The judge concluded that Mr. Halef’s conduct—requesting particulars of the delay claim through counsel, initiating a “without prejudice” negotiation overture, meeting with Ms. Mercer, and then writing directly to Mr. Graham and later repeating the same language—would lead a reasonable contractor and counsel to interpret the March 4 and 5 communications as part of an ongoing settlement dialogue about multiple issues, not as a formal rejection that started a strict deadlines regime. The Court also noted that Mr. Halef appeared to have been careful to couch his words strategically and inferred that he intended to obscure the fact that he might later argue a “finding” had been made, thereby setting up a waiver argument when the time limit could be said to have expired.

Application of estoppel against BANC

In the alternative, even if the March 5 email could technically be characterized as a finding, the Court held that BANC was estopped from relying on it as such. Drawing on modern, flexible estoppel principles from cases such as Dunn v. Vicars, Kings (County) v. Berwick (Town), Gulston v. Aldred, Gillis v. New Glasgow (Town), and the Supreme Court of Canada’s articulation of promissory estoppel in Trial Lawyers Association of British Columbia v. Royal & Sun Alliance Insurance Co., the Court identified BANC’s conduct as creating a reasonable and detrimental reliance. Through his words and behaviour, Mr. Halef represented that he was engaging in an attempt to resolve all outstanding issues by negotiation—“an effort to resolve all this,” willingness to be “reasonable,” and explicit invitations to discuss or meet—rather than signaling a closed decision on the delay claim. Integrum and its counsel in turn acted on that representation, treating the matter as open to negotiation and not as a concluded finding requiring a formal, time-sensitive Notice in Writing of dispute. The Court observed that BANC and its counsel did nothing to correct this impression until May 21, 2025, when they first asserted that the delay claim had been waived by operation of GC 8.2.2. By that point, BANC sought to rely on the very ambiguity it had fostered to claim a procedural bar against Integrum’s delay claim. In these circumstances, the judge concluded that it would be unfair and inconsistent with sound equity to allow BANC to go back on the underlying assumption its own conduct had created. BANC was therefore estopped from arguing that the March 5 email was a “finding” that triggered the waiver mechanism.

Status of the delay claim and next procedural steps

Having determined that the March 5, 2025 correspondence did not constitute a finding, and that BANC was in any event estopped from asserting otherwise, the Court turned to the status of Integrum’s delay claim under the contract. The earliest clear indication that BANC treated the matter as a formal rejection or finding came in BANC counsel’s letter of May 21, 2025, which expressly stated that the March 5 email was a finding and that Integrum’s delay claim was barred as a result of not providing a Notice in Writing of dispute within 15 working days. But by then, Integrum had already served its Notice of Arbitration on May 15, 2025, which contained the particulars of the dispute and relevant contract clauses and was addressed and delivered in a manner meeting the defined requirements of “Notice in Writing.” The Court held that this notice was sufficient to constitute a Notice in Writing of dispute under GC 8.2.2. Even if one looked instead to Integrum’s counsel’s letter of May 26, 2025, responding to BANC’s May 21 letter and insisting the delay claim remain in issue, that communication also fell well within any reasonable 15-day window triggered by BANC’s express assertion that a finding had been made. In addition, the Court found that Integrum had complied with the spirit, if not every technical step, of the ADR regime by expressing a willingness to proceed to mediation and by suggesting that both delay and deficiency/unpaid amounts be mediated together. It was BANC that refused to include the delay issue in mediation, effectively depriving Integrum of the full benefit of the contractual dispute-resolution pathway. In the judge’s view, this placed the parties in a position analogous to that described in GC 8.2.7, which provides that when the 10-day period following termination of mediation passes without a binding reference to arbitration, the arbitration agreement ceases to be mandatory and the parties may refer their unresolved disputes to the courts or any other agreed form of dispute resolution, including arbitration. Coupled with GC 8.3.1, which preserves rights and recourses where proper notice has been given, the Court concluded there had been no renunciation or waiver of Integrum’s substantive rights.

Outcome, successful party, and monetary consequences

In conclusion, the Supreme Court of Nova Scotia declared that Integrum’s delay claim remains extant and has not been contractually waived or released. The Court rejected BANC’s attempt to treat the March 5, 2025 email as a binding finding that extinguished the delay claim, both on a proper reading of the contract and by application of estoppel. As a result, the parties are free to pursue their unresolved disputes—regarding delay, holdback, and deficiencies—either in court or through arbitration or other ADR mechanisms they may agree upon, consistent with the structure of Part 8 of the CCDC 17 contract. The Court did not decide the merits or quantum of the delay or deficiency claims and made no findings on whether delay damages are actually payable or in what amount. The decision instead addresses only the procedural and contractual gateway: Integrum is entitled to advance its delay claim and is not barred by GC 8.2.2. On costs, the Court held that the Applicant, Integrum Painting, is entitled to its costs of the application, thereby identifying Integrum as the successful party. However, the judge left the amount of costs to be determined by the parties, granting them 15 business days to reach agreement and indicating he would accept short written submissions if they could not. No specific figure for damages, delay compensation, holdback, or costs is fixed in the reasons, so the total monetary award or costs in favour of Integrum cannot be determined from this decision alone.