An Ontario Superior Court judge has dismissed a motion1 by two homeowners to stop, Integricon Construction, a construction company from garnishing their bank accounts, reinforcing the power of the province’s new prompt payment and adjudication system under the Construction Act. The decision confirms that an adjudicator’s order for payment can be swiftly enforced, even if there are parallel legal actions like a construction lien or disputes about the contract’s termination.
The case involves homeowners Derek Stevens and Ashna Latchmiah, who hired Integricon Construction Inc. in July 2022 to perform significant work on the construction of their new single-family home. The project was financed by the Royal Bank of Canada. According to court documents, the contract signed by the parties included a specific “draw schedule” that dictated when payments were to be made to Integricon based on the completion of certain construction milestones.
After the homeowners made an initial payment of $170,828.19, Integricon began work. By September 20, 2024, the company had completed the foundation and backfilling of the property, which was the trigger for the second scheduled payment. Integricon subsequently issued an invoice for the second draw, amounting to $215,243.53. However, a dispute quickly arose when the homeowners refused to pay. Their refusal was based on the position of their bank, RBC, which would not release the next portion of the construction loan. An appraisal firm retained by the bank had determined that while the foundation and backfill work was 100% complete, it only constituted 15% of the overall project value. The bank required 25% of the total project to be finished before it would advance more funds.
The homeowners argued that their payment obligation to Integricon was tied to their ability to get funds from RBC. They pointed to emails exchanged before the contract was signed where they had discussed RBC’s requirements and a potential payment schedule of four equal 25% draws. Despite these discussions, the final written contract established a payment schedule based on specific work milestones, not overall project percentages. The contract contained no clause making payments conditional on the bank’s approval.
Faced with non-payment, Integricon issued a notice of default on November 4, 2024, and ceased further work on the project. On January 15, 2025, the company took advantage of the relatively new adjudication process under the Construction Act, a system designed to resolve payment disputes quickly to keep construction projects and funds flowing. While the adjudication was underway, Integricon also registered a construction lien against the homeowners’ property for $364,380.49 on February 10, 2025.
On March 12, 2025, the adjudicator, Marcel D. Mongeon, released his determination, siding firmly with Integricon. He found that the contract was clear and unambiguous. The agreement required the homeowners to pay the second draw upon the completion of the foundation and backfill, a milestone that Integricon had met. The adjudicator rejected the homeowners’ argument that the bank’s financing conditions should be read into the contract. He concluded that the “disconnect” between what the homeowners had agreed to pay their contractor and the terms of their loan from the bank was not the contractor’s responsibility. He ordered Mr. Stevens and Ms. Latchmiah to pay the outstanding invoice of $215,243.53 plus interest.
Following the adjudicator’s decision, the homeowners offered to pay the amount owed if Integricon would agree to return to the job. When the payment was not made, Integricon terminated the contract on March 25, 2025. The homeowners argued this termination was an improper repudiation of the agreement. Seizing its enforcement rights under the Construction Act, Integricon filed the adjudicator’s determination with the Superior Court, giving it the same power as a formal court order. On April 11, 2025, the company served Notices of Garnishment on the homeowners’ banks, leading to their accounts being frozen and approximately $130,000 being seized and sent to the Sheriff’s Office.
In response, the homeowners brought a motion before the Superior Court, asking Justice Sunil S. Mathai to set aside, stay, or refuse the garnishment. They argued that enforcing the order would be unfair and inequitable. Their main arguments were that Integricon should not be paid since it had terminated the contract and would not be completing the work, and that allowing both the garnishment and the lien to proceed created a risk of “double recovery” for the contractor. They suggested that Integricon was only entitled to the value of the actual work performed, which they calculated to be just over $47,000 more than the first draw they had already paid.
In his decision released August 13, 2025, Justice Mathai dismissed the homeowners’ motion entirely. He found that their motion was effectively an improper attempt to appeal or stay the adjudicator’s decision through the back door. Justice Mathai explained that the Construction Act provides a very specific and narrow path for challenging an adjudicator’s determination, which requires seeking permission for a judicial review from the Divisional Court within 30 days. The homeowners had not followed this procedure. A garnishment motion, he noted, is not the proper venue to challenge the correctness of the underlying order being enforced.
Justice Mathai stated that allowing the homeowners to use a garnishment motion to undermine the adjudicator’s finding would “effectively eviscerate the purpose of the prompt payment and prompt adjudication provisions” of the Act. These provisions were specifically enacted by the legislature to prevent the kind of payment delays that can stall construction projects.
He systematically rejected the homeowners’ arguments of unfairness. He found nothing in the adjudicator’s decision to suggest the payment order was conditional on Integricon continuing work. The order was for a milestone already completed. Furthermore, the later termination of the contract did not erase the debt that had already become due. Citing a previous case, Justice Mathai affirmed that rights that arise before a contract is terminated continue to exist.
Addressing the concern about double recovery, the judge found little risk of it occurring. He noted that the Act permits adjudication and lien actions to proceed at the same time. He explained that there are legal mechanisms to prevent a contractor from being paid twice for the same work. For instance, any money recovered through garnishment could be used to reduce the amount of security the homeowners would have to post to vacate the construction lien. Ultimately, a judge in the main lien action would determine the final amounts owed and could order the repayment of any funds if necessary.
Justice Mathai concluded that the homeowners’ motion was an attempt to get the court to “do indirectly what it cannot do directly”, which is to stay the adjudicator’s payment order. He ruled that he lacked the jurisdiction to do so and that there was nothing unfair about Integricon using the legal enforcement tools provided by the statute. The judge dismissed the motion, allowing the garnishment process to continue.
