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“Construction Manager” was Constructor on Project, Despite use of New “Model”

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A new “model” of construction, where a “construction manager” was used instead of a “traditional general contractor”, did not insulate the construction manager from safety charges.

Reid & DeLeye Contractors Ltd. was retained as a “construction manager” on a project owned by Future Inns Cambridge Inc.  The construction contract included the following provision:

“Under this type of construction management arrangement, the traditional roles and relationship of owner/general contractor disappear.  The Owner engages the trade contractors directly and thereby assumes much of the role and responsibility of the traditional general or prime contractor.”

A labourer on the project suffered a fractured arm when he fell off scaffolding.  The construction manager, Reid & DeLeye, was charged as “constructor” under the Ontario Occupational Health and Safety Act.

Reid & DeLeye argued that the use of a construction manager, rather than general contractor, was a new and more-efficient model, and that because the owner contracted with the subtrades, the owner – not Reid & DeLeye – was the constructor under the OHSA.

The Ontario Court of Justice disagreed.  The contract with the project owner stated that Reid & DeLeye was to provide “site management” and “leadership to [the Construction Management Team] on all matters relating to construction”.  The contract between the owner and a forming subtrade stated that Reid & DeLeye will “assume overall responsibility for establishing and coordinating the safety precautions and programs”.  The court decided that the contracts showed that Reid & DeLeye was to oversee that safety precautions were undertaken by all employers and employees on the project and that safety programs were in place.  Also, Reid & DeLeye’s conduct on the project showed that it understood that it was required to oversee the sub-trades’ use of scaffolds. 

The court said that the more control a company exerts, the more likely that it was a constructor.  Here, Reid & DeLeye was the constructor on the project.

This case illustrates the importance of the terms of contructions contracts, but also of the on-the-ground actitivities of the parties, in determining who is the constructor.  A “construction manager” will be the constructor, and therefore at risk of charges and fines, if in fact it has control over a project, even if the construction contract tries to avoid having the construction manager be the “constructor”.

Ontario (Ministry of Labour) v. Reid & DeLeye Contractors Ltd.: http://www.canlii.org/en/on/oncj/doc/2011/2011oncj472/2011oncj472.html