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

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

Adrian Miedema

About Adrian Miedema

Adrian is a partner in the Toronto Employment group of Dentons Canada LLP. He advises and represents public- and private-sector employers in employment, health and safety and human rights matters. He appears before employment tribunals and all levels of the Ontario courts on behalf of employers. He also advises employers on strategic and risk management considerations in employment policy and contracts.

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