This case involves a dispute over a renewal contract for the rental of a water cooler. The plaintiff, City Water International Inc., claimed the defendant, Wax Hairdressing Inc., breached the renewal contract by failing to make payments. The court found that the individual who signed the renewal contract on behalf of Wax Hairdressing had apparent authority to bind the company. The court also found Wax Hairdressing was estopped from arguing it was not bound by the contract given it made payments according to the contract for years. The court awarded damages of $1879.25 to the plaintiff.

1. Case Name:
City Water International Inc. v. Wax Hairdressing Inc.
Between
City Water International Inc., Plaintiff. and
Wax Hairdressing Inc., Defendant
[2012] O.J. No. 6252
Court File No. SC-10-110171-00
Ontario Superior Court of Justice
Small Claims Court - Toronto, Ontario
W.C. De Lucia Deputy J.
Heard: July 19, 2012.
Oral judgment: July 19, 2012.
(14 paras.)
Counsel:
M. Riddell, for the Plaintiff.
S. Makrigiannis, for the Defendant.
REASONS FOR JUDGMENT
1 W.C. De LUCIA DEPUTY J. (orally):-- In the matter of City Water International Inc, as
plaintiff and Wax Hair Dressing Inc. and Spiro Makrigiannis as defendants, the trial was heard this
day, July 19th, 2012. The plaintiff, was represented by Mr. Riddell and the defendant's were self
represented. The plaintiff claims through an amended plaintiff's claim the sum of $1903.17 and they
are claiming pre-judgment interest from September 28th, 2010 pursuant to the Courts of Justice Act,
post judgment interest and court costs.
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2. 2 The brief background is as follows, that the plaintiff is a corporate entity carrying on business
in Ontario, and wherein it carries on a number of activities, such as distributing and renting and
servicing and selling point of use water filtration, and purification systems to businesses and to
individuals. The defendant - the corporate defendant Wax Hairdressing Inc. was one of the parties
that originally entered into a business arrangement to rent, what we will call for the purposes of this
Judgment - a water cooler for its business at the business location at 533 - sorry - okay that's the
correct address, 533 was the subsequent address and the first address was as per the contract, let me
just go to that. At 388 Richmond Street West unit two, that's where the parties had the original
dealings. And the plaintiff in the normal course of its business presented certain documents with
respect to rental of the water cooler. And that arrangement was entered into in 2003.
3 The arrangement or agreement became a contract which was stipulated by both parties, a
binding agreement and an enforceful agreement as set out at Exhibit Number 1, which also has the
rental terms, but also has the service agreement terms. No dispute as to that contract of 2003 that
ran for five years and no default by the defendant. The plaintiff comes claiming the sum as
indicated earlier, as it alleges there was a breach of the renewal contract which was submitted in
evidence as Exhibit Number 2, and entered into on or about March 10th, 2008. Again, the same
parties the plaintiff as City Water International Inc. as lessor and the defendant Wax Hairdressing as
the lessee.
4 This document at Exhibit 2 is the critical document because the plaintiff is alleging the breach
occurred under what I will call contract number two or the renewal contract and the defendant
rebuts by saying that there was no enforceable contract entered into in March of 2008. And basing
his argument or its argument regarding the renewal contract that no person with authority signed the
document to bind Wax Hairdressing, it's not the signature of the authorized party being Mr. Spiro
Makrigiannis, and his evidence is that Ms. Courtney Reynolds back in March of 2008 at 388
Richmond St. West had no authority and the plaintiff cannot bind him or it to the rental payments as
contemplated under the renewal contract. The plaintiff maintains in its evidence that the renewal
contract is a binding, enforceable agreement and that the party who signed has ostensible authority
and apparent authority to bind the defendant and the terms Were set out. The only thing that
changed was the rent per month and the end date of the renewed contract, otherwise all of the terms
and conditions of the original contract were to remain in full force and effect.
5 The plaintiff's evidence was supported by the documents submitted, not only the actual under
oath evidence of Mr. Lowery as the accounts receivables and collections personnel of the plaintiff.
But each document describes the corporate or the contractual life between the parties under the first
contract and then it maintains under the renewal contract. And so we do have the terms as set out in
Exhibit 1. We have the renewal contract in Exhibit 2, and then the plaintiff in Exhibit 3, sets out
what is called the final invoice as it was requested by the defendant to pick up the water cooler, on
or about September the 22nd 2010, and no further payments were made or have been made for a
period of time, and the invoice as set out in Exhibit 3 captures the amount owing from April lat,
2010, through to the end of the term contract end date as set out in contract two, June 30th, 2013. It
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3. also captures the removal cost as contemplated under the contract of the equipment of $321.17 for a
total, plus HST, of $1903.17 forming the basis for their claim.
6 The defendant's rebuttal on several points-in particular his most emphatic point is that no one
with authority signed therefore I am not bound. I accept the evidence and the supporting case law
that in fact Ms. Reynolds had the ostensible authority and it is not incumbent on the plaintiff to
investigate that authority but it will be incumbent upon the defendant to rebut it. And from 2010, it
was noted that a series of payments were made and the evidence shows that I find that after the
renewal contract - I find that the authority was there to bind Wax Hairdressing. A further eight
payments were made by the defendant Wax Hairdressing to the plaintiff, and for the defendant to
come to court now, and to argue not a binding contract when its conduct and its payments were
consistent with the contract and its terms.
7 So I do find that the defendant is estopped from arguing that he is not bound. The payments
have been made during that period of time, from March of '08 to about April 1st, 2010. And further
the evidence is that Mr. Makrigiannis monitored the accounts of the business and so was fully aware
of the debits and the obligations and he does admit that he accepted the fact that he was bound or
that he owed the money. He believes under the old contract when in fact the contract was renewed. I
don't accept, nor do I find that Mr. Makrigiannis - or the company in fact Wax Hairdressing - did
not know or did they reject at any time, at the earliest instance contract number two.
8 It is also telling as Exhibit Number 4 which was the payment history between the lessee Wax
Hairdressing and the plaintiff City Water, in that the contact person on page two or on page one of
the documents from the beginning was Courtney Reynolds.
9 So I do find based on the evidence and an objective analysis of the plaintiff's evidence and the
exhibits that as to the contractual relationship between the plaintiff and the defendant Wax
Hairdressing, I do find that the renewal contract is an enforceable and binding and valid agreement
that incorporates all of the terms of the original agreement and service agreement as set out in
Exhibit 1.
10 There was no evidence as to the Consumer Price Index to support the plaintiff's claim of the
CPI to be added to the removal cost contemplated and set out in the agreement. So I will not allow
the additional $21 and change that was set out in the final invoice at Exhibit 3. I also find that the
amount claimed from April 1st, 2010 to June 30th, 2013, in the amount of $1363.05 constitute
liquidated damages. They can be readily calculated by the terms of the agreement and so it does not
constitute a penalty provision, but rather liquidated damages, and in fact the plaintiff will be entitled
to what will be called the expectant damages under the contract number 2. And I also do find that
the defendant's non-payment constituted a breach of the contract. As to the various locations
referenced in the defendant's testimony, be it 388 King West or 533 King West or 787 King West,
they speak to the business turmoil of the defendant's life, as opposed to the contractual obligations
with City Water.
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4. 11 As to the corporate existence or validity of the defendant Wax Hairdressing Inc. I find that
there is no evidentiary foundation before me to make any decision that would disturb what were and
may still be the parties. The plaintiff could have readily and easily provided certified copies of any
corporate searches. The defendant could have easily provided any certified copies of searches, or a
certificate of status as to its existence, or the plaintiff a certificate of status that it had been
dissolved. Neither party provided anything for this court to disturb the existence of these parties. So,
I accordingly I find that the defendant - the corporate defendant is the proper party and that is not to
be disturbed, nor do I find that Mr. Makrigiannis would then become personally liable. So the
corporate entity for the purposes of this judgment and the evidence before me is the proper lessee
and party that is liable. There is no personal guarantee of Mr. Makrigiannis, so accordingly there is
no finding of liability as to him personally, there is a finding and a judgment for the amounts as
claimed except for the consumer price adjustment that was referred to earlier. So based on the
evidence before me the plaintiff has discharged its onus as to its claim as against Wax Hairdressing
Inc.
12 And the calculation being as per Exhibit Number 3, being the final invoice, and the amount
would be $1363.05 and the $300 for a total of $1663.05, and then Mr. Riddell if you want to
calculate that for me, the 13 per cent of that amount. Or I will calculate the 13 per cent on that
amount. I am just trying to pull out the $21.17 that was added in. So it looks like it is $1663.05 and
HST of $216.20. Do you agree?
13 MR. RIDDELL: Yes.
14 THE COURT: For the HST, so for a total of $1879.25. So there will be Judgment - the
.endorsement will read Judgment for the plaintiff in the amount of $1879.25. There will also be
pre-judgment interest from the amount - the date as claimed in September of 2010 and the date set
out in the amended claim being September 28th, 2010, and post-judgment interest in accordance to
the Courts of Justice Act.
qp/s/qljel/qlrdp/qlrxg
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