LEGAL NOTES

Desco Plumbing & Heating Supply(Desco) is celebrating its 20th anniversaryin 2013. And, looking back on its hum-ble beginnings, the company is extremelyproud of the significant growth it has

experienced over the years.Desco, a subsidiary of Deschênes Groupe Inc.

(DGI), is a full-line distributor of plumbing, me-chanical, hydronic and HVAC products. The companyspecializes in supplying professional trade contractors

By DEEPAK NAYAK, MCA Toronto President

Continued On Page 2

D with products and services catering to the plumbing,heating, mechanical, industrial and institutional mar-kets in Ontario.

Along with the other subsidiaries of DGI, Descowas recently named as one of Canada’s Best ManagedCompanies for a fourth consecutive year. Addition-ally, the company is an active participant in many in-dustry groups, and is a member of associations suchas the Mechanical Contractors Association of Toronto

TContinued On Page 9

As the days arequickly becomingshorter, I hope eve-ryone has had awonderful summer

thus far. MCA Toronto’s summeragenda has been and continues tobe jam-packed with a host of so-cial and networking opportunitiesfor members to partake in.

The summer kicked-off with

the MCA Toronto Golf Classic,which was held on June 27, 2013,at the Nobleton Lakes Golf Clubin Nobleton, Ont. The annual clas-sic was once again a fantastic daywith MCA Toronto members,associates and industry partnersenjoying a great round of golf andcamaraderie.

One week following the golf

AContinued On Page 5

MCA TorontoNetworking OpportunitiesAbound This Summer

PRESIDENT’S MESSAGECOMPANY PROFILE

Contractor’s WarrantyTriggered By Defect Desco Plumbing

& Heating Supply20 years and Still Growing!

One of Desco’s boom trucks in action.With their large fleet of trucks, Desco can meetany delivery requirement.

By R. GLEN BOSWALL,Clark Wilson’s Construction &

Procurement Group

The recent decision of theBritish Columbia Courtof Appeal in Greater Van-couver Water District(GVRD) vs. North Ameri-

can Pipe & Steel Ltd. serves as a warn-ing to contractors about the riskstaken when they commit to followdesign specifications while also pro-viding an unqualified warranty againstdesign defects.

The case concerned a contract for

the supply of water pipe to theGVRD. The tender documents is-sued by the GVRD required that thepipes have a seal coat over a fibre matover-wrap. The documents also in-cluded contractual terms stating thesupplier “warrants… that theGoods… will conform to all applica-ble Specifications…” and “warrantiesand guarantees that the Goods arefree from all defects arising at any timefrom faulty design in any part of theGoods.” North American Pipe sub-mitted the winning bid and manu-

Arising From Owner’s Specifications

2 MCAT PIPELINE - Summer 2013

Desco Plumbing& Heating Supply

MCATBOARD OF GOVERNORS

PresidentD. Nayak

Modern Niagara Toronto Inc.First Vice President

A.L. ProwseH. Griffiths Co. Ltd.

Second Vice PresidentL. Carinci

Hi-Rise Mechanical Inc.TreasurerS. Munro

COFELY AdeltPast PresidentV. Di Gaetano

Royal Mechanical Inc.Director

M. BattagliaBattaglia Mechanical

DirectorB. Grist

Grist Mechanical Contractors Inc.

DirectorD. Belluz

Bering Mechanical Ltd.

DirectorD. Bennett

Black & McDonald Ltd.

DirectorF. L. Turano

GTA Mechanical

Ex-officio Director (GTECA)P. Sheridan

Plan Group Inc.

Ex-officio Director (TSM)T. Pierce

Alpha Free-Flow Ind. Ltd.

Ex-officio Director (MIAO)T. Kelly

INSCAN KAEFER Inc.

Ex-officio Director (ORAC)D. Russo

ReadAir Mech. Services Ltd.

PIPELINE is a “marketing andinformation periodical” publishedfor the Mechanical ContractorsAssociation of Toronto by PerksPublications Inc.

Publisher: Mike NoskoEditor: Tanja NowotnySales: Cathie Fedak

Advertising in PIPELINE isrestricted to member companiesof MCAT.

ppiPERKS PUBLICATIONS INC.3 Kennett DriveWhitby, Ont. L1P 1L5Tel: (905) 430-7267Toll Free: 1-877-880-4877Fax: (905) 430-6418E-mail: cathie@perkspub.comWeb Site: www.perkspub.com

MECHANICALCONTRACTORSASSOCIATION OF TORONTO595 Cityview Blvd., Unit 7Vaughan, Ont. L4H 3M7Tel: (416) 491-9004Fax: (416) 491-9007E-mail: McCabe@mcat.on.caWeb Site: www.mcat.on.ca

Continued From Page 1

Continued On Page 9

(MCAT), Canadian Institute ofPlumbing & Heating (CIPH), Build-ing Industry & Land DevelopmentAssociation (BILD) and the TorontoConstruction Association (TCA), toname a few.

Desco was formed in 1993 afterDGI entered the Ontario marketthrough its acquisitions of RocamoraBrothers Canada (1990), and Trian-gle Plumbing and Heating Supply

tions. In 2011, the company an-nounced the acquisition of RidlerHeating and Cooling Supply, withlocations in Rexdale and Guelph,Ont., and last November (2012), thefirm completed the purchase of West-ern Plumbing and Industrial Sup-plies, with two locations in Londonand Stratford, Ont.

Between new branch openingsand acquisitions, Desco has grown insize with regards to its employees, Customer Satisfaction.”

Although the firm is a supplierof plumbing and heating products,Desco is in the business of keepingpromises. The company’s employeesare the back-bone to great customerservice. The Desco team representssome of the most enthusiastic andknowledgeable people in the indus-try. With the average employee ten-ure at 13 years (many of the employ-ees have been with the company sinceits beginnings), contractors can easilyreceive an answer to any questions theymay have.

“Our employees are part of a fam-ily that drives our ‘Customer First’mandate,” said Jon Leeson, vice presi-dent and general manager of Desco.“Our team represents some of themost experienced and knowledgeablepeople in the industry from our cus-tomer service employees, our ware-house and delivery teams through toour sales representatives.”

Customer needs are the day-to-dayfocus at Desco.

“We are constantly looking at waysto continue to raise the bar when itcomes to looking after our custom-ers,” Leeson said. “We have designeda number of value-added contractorservices to make life easier for them.Initiatives such as our 24 hourcurbside program for after hours andemergency pick-up; our large and di-

versified fleet of boom and boxtrucks; our in-house project quota-tions department; and a team of en-thusiastic and experienced sales rep-resentatives are just a few of the ad-vantages of dealing with our com-pany.”

The business model at Desco isalso built around having the inven-tory that customers need, as well aswhere and when they need it. Theteam utilizes a state-of-the-art ware-house management system to man-age over 35,000 SKUs. This manage-ment system allows employees toinstantly identify the status of allproducts, orders, receipts and trans-fers, improves picking accuracy, andreduces contractor wait-times at thecounter.

A major part of the company’ssuccess is also tied to its delivery team,which is among the best in the in-dustry.

“The Desco team has worked hardto manage the various demands thatarise from the multiple segments thatwe cater to,” Leeson said. “Need a de-livery at 5 a.m.? No problem. Need ashipment placement on the thirdfloor of a building? No problem.”

Desco has its own GPS-equippedfleet of trucks with various capabili-ties that enable drivers to re-route onshort notice to meet customer de-

All steel and copper pipe is stored indoors at Desco to ensure that customers always receive pipe thatis free of rust and tarnishing.

The large Etobicoke Distribution Centre ensures that Desco has all the products its customers needevery day.

inventories, branch locations and de-livery fleet. The company currently hasover 500,000 sq. feet of warehouseand yard storage. Eight years ago theymoved to their current WorcesterRoad facility in Etobicoke, Ont.,which houses the head office of thefirm, along with the main distribu-tion centre. Plans are currentlyunderway to expand the distributioncentre to keep up with the company’scontinuing growth.

The team at Desco has a commongoal of consistently exceeding its cus-tomers’ expectations through indus-try leading “Service, Selection and

Inc. (1991).Shortly after Desco’s incorporation

in 1993, the company purchased threelocations that had been owned by J.B.Allen in western Ontario. Thisbrought the total number of branchesat that time to 10. In 1998, Descoentered the showroom business withthe launch of the “Water Closet” ban-ner. Today, the company is comprisedof 17 branch locations and threeluxury showrooms. Planning isunderway to continue to open newlocations across the province.

Growth for Desco over the pastthree years has come through acquisi-

Customers at Desco’s Etobicoke location enjoying one of their themed summer BBQs. Theme forthese BBQs include ‘Taste of Italy’, ‘Greek Week’ and ‘Mexican Fiesta’. Go to www.desco.ca for fullBBQ details and a 2013 schedule.

Each year Desco and selected vendors host a number of customer appreciation events like this tripto a Buffalo Bills game that included a tailgate party and tickets to the game.

MCAT PIPELINE - Summer 2013 3

STEWART MACINTOSH,Installer, Atlantica Mechanical

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ON THE LINKS

(From left) Brad Campbell, Richard Dubey, Glen Kellaway and Ian Dales.(From left) Terry Pierce, Neil Bell, Peter Minialoff and Kim Crossman.

(From left) Dino Russo, Dave Irwin, Gregg Little and David Steel.(From left) Luch Carinci, Tony Fiore, Silvio Arone and Ulisse Torelli.

(From left) Brian McCabe, Terry Snooks, Jim Hogarth and Deepak Nayak. (From left) Bruce Laitinen, Al Prowse, Jim Davidson and Mel Prowse.

Most Honest Team: (from left) Brian McCabe, Bruno Rossi, Wendy Page,Mark Barwood, Tom Kilmer and Deepak Nayak.

First Place Team: (from left to right) Brian McCabe, Doug Smith, JohnStewart, Brian Stewart, Elaine Hopkins and Deepak Nayak.

Third Place Team: (from left) Brian McCabe, Frank Syer, Bill Reynolds,Burney Grist and Deepak Nayak.

Second Place Team: (from left) Brian McCabe, George Watters, ScottWatters, Larry Infanti and Deepak Nayak.

On June 27, MCA Toronto hosted its 23rd

Annual Golf Classic, which saw over 200golfers tee off at the Nobleton Lakes GolfClub. Through their registration, participantsO

MCAT Members Take to the Linksfor the 23rd Annual Golf Tournament

contributed to both the Canadian Mechanical Contrac-tors Education Foundation (CMCEF) and the Ride toConquer Cancer. With a fine buffet breakfast followedby a 10 a.m. shot gun start, a good day was had by all.

4 MCAT PIPELINE - Summer 2013

The Young ExecutiveCommittee (YEC) hadits second annual GolfDay at the DiamondBack Golf Club in Rich-

mond Hill on Fri. May 31. Theweather was ideal and all participantshad a great time.

The YEC did something differ-ent this year and organized a charityraffle instead of a prize table. Throughthe generous donation of prizes bymany companies and ticket sales, the

SPECIAL FEATURE

TYoung ExecutivesHave Been Giving Back

group raised $1,060 for Youth With-out Shelter. The YEC is looking for-ward to making this an even biggerevent next year.

Last month, the YEC volunteeredfor an Adopt-A-Day with Habitat forHumanity York Region. The groupcollected online donations and thenvolunteered their time on Fri. July 26at a Sutton build site. While on-site,the group built and raised one wall,framed a second, put gravel on theweeping tile, dug a sump pit in the

basement and prepared trenches forthe plumbers. Thank you to every-one who donated and participated.The YEC members raised $2,246 forthis worthwhile charity.

The YEC is currently seeking newmembers with a goal of having evenmore companies represented. Meet-ings will commence in September.

If you or someone in your company is40 years of age or under, and would like toget involved, please contact Wendy Page atwendypage@mcat.on.ca.

MCAT PIPELINE - Summer 2013 5

PART THREE

The Need ForPrompt PaymentLegislation

In the construction industry,payment risk is both real andgreater than it needs to be. Pay-ment risk causes constructionbusinesses to operate in ways

that have negative consequences forthe economy. These broader eco-nomic consequences of payment riskinclude: diminished employment,fewer apprenticeships, lower produc-tivity as a result of reduced invest-ment in machinery and equipment,and higher construction costs result-ing in risk factors being incorporatedinto bid prices.

Limits on Contractors’ Capacityto Carry Payment Risk

The ability of contractors to takeon the risk of late payments is con-strained by two factors. The first istheir working capital. The second istheir access to bank credit. All con-struction companies, but especiallysmaller firms, encounter difficulty in-creasing their lines of credit when pay-ments owed to them are delayed. Al-ternatively, the terms on which creditmay be offered will be a deterrent.Consequently the amount of work-ing capital, relative to the size of pay-roll and obligations to suppliers, isthe most important determinant ofa construction company’s capacity totake on any additional risk of latepayment.

Economic Consequences

The average collection period is aproxy for the impact of payment de-lays on cash-flow. Figure One showsthat, in the construction industry, the‘average collection period’ for receiva-bles has increased in the last decade.This contrasts the trend for non-fi-nancial businesses as a whole.

For non-financial businesses, av-erage collection periods increasedfrom approximately 43.9 days in 2005to 48.5 days in 2010 and then fell backto 48.0 in 2011. In the construction in-dustry, however, the average collection pe-riod is both longer and increased moresharply – from 57.3 days in 2002 to 69.2

days in 2011.The essence of the late payment

risk in not wholly captured by changesin the average collection period. Thecore of the late payment risk is whatfinancial analysts call ‘tail risk’, namelythe risk that a few receivables will besubject to significant and uncertain de-lay. The nature of ‘tail risk’ is illus-trated in Figure Two.

Figure Two depicts a notional dis-tribution of payment periods, al-though the averages for 2002 and2011 reflect the estimates derivedfrom Statistics Canada data. Based onStatistics Canada data, the ‘averagecollection period’ increased from 57.3days in 2002 to 69.2 days in 2011. Ifthe cause of this were simply an 11day increase in the collection periodfor a typical payment, it might be in-ferred that the increase in late paymentrisk was comparatively moderate.However, trade contractors tell quitea different story. Their experience isthat the increase in the average collec-tion period was actually caused by anincrease in the proportion of pay-ments that fell into the significantlydelayed category, i.e., the portion ofthe graph to the far right of the aver-age. This is the ‘tail risk’. Although‘tail risk’ probably affected fewer than

I

Continued On Page 6

FIGURE ONE – Average Collection Period (Days) for Receivables:Construction Industry compared to All Non-Financial Business –1999 – 2011 (Canada)

FIGURE TWO – Illustration of Notional Distribution of Collection Periodsshowing the ‘Long Tail’ of Significantly Delayed Payments(Average Collection Periods based on Statistics Canada)

PRESIDENT’S MESSAGEContinued From Page 1

classic, MCA Toronto had a chanceto show its appreciation to theCommittee members who give oftheir time throughout the year. ACommittee Appreciation Nightwas held at the Toronto Blue Jaysgame at the Roger’s Centre on July4. Thank-you to everyone for yourcontinued hard work!

On July 10, the MCA TorontoExecutive joined the fundraisingefforts of the Canadian Mechani-cal Contracting Education Foun-dation (CMCEF) at its annual golftournament held at the CaledonGolf & Country Club in Caledon,Ont. Over $15,000 was raised dur-ing this event.

At the end of July, I had theopportunity to attend the UnitedAssociation’s (UA) National Con-ference in St John’s, Nfld. Thisconference was a wonderful op-portunity to meet with Mr. JohnTelford, International vice presi-dent and director of CanadianAffairs at UA Canada, along withhis staff. During our meeting, Ialso had a chance to discuss NorthAmerican construction trendswith Mr. Bill Hite, president of UAInternational. In a presentationduring the conference, Mr. Hite re-ported that plumbers, steamfittersand welders in Australia have nowjoined the UA.

In early August, I attended theMCA Ontario Summer meeting inKitchener, Ont. The MCA TorontoExecutive also attended the On-tario Construction Secretariat (OCS)Conference at Deerhurst Resort, toreview the current and future trendsof Unionized Construction.

At this time, I would like tothank the Joint Training Appren-

ticeship Committee (JTAC) for itscontinued hard work and dedica-tion. In mid-August JTAC mem-bers attended the UA Train-the-Trainer Industry Day in Ann Arbor,Mich., where contractors and clientsare invited to review and witness theextensive training our North Ameri-can workforce is exposed to on adaily basis. It is the constant train-ing and upgrading that our contrac-tors endure that distinguishes usfrom the competition.

MCA Toronto continues to bevery busy planning the celebrationsfor our 50th anniversary annual gen-eral meeting (AGM) being held atthe JW Marriott in Minett, Ont.,from Oct. 3 to 6, 2013. The PublicRelations committee has a full line-up of entertainment for the spe-cial weekend and all indications arethat the 50th anniversary AGM willbe sold out!

It is with a heavy heart that I reportthe loss of a great friend and fellowBoard member, Mr. Brent White ofGeo. A. Kelson Co. Ltd., on July 11.Brent will be sadly missed by his wifeShirley and his family. I know theMechanical Industry lost an excel-lent man when we lost Brent. He iscertainly going to be missed.

In closing I would like to thankthe MCA Toronto Board of Gov-ernors, the associates and the as-sociation staff for their supportover the last two years. During myterm as president, I have enjoyedmeeting and working with MCAToronto members and associates,as well as the provincial, nationaland international MCA’s. I lookforward to staying in touch withyou as we move forward and con-tinue improving our industry.

6 MCAT PIPELINE - Summer 2013

MCAT 2013Standard Practice

CommitteeThe following individuals comprise the 2013 / 2014 MCAT Standard Practice Committee:

Burney Grist, ChairGrist Mechanical(905) 629-1977

Terry WarrenE.S. Fox Ltd.(416) 569-5774

Brian EdmundsRosenberg & Parker of Canada(416) 733-2245

Don BennettBlack & McDonald(416) 366-2541

Jim BloreComstock Canada(905) 335-3333

Bob PhilipModern Niagara Toronto Inc.(416) 749-6031 x.298

Don SmithEnglish & Mould(905) 857-7778 x.298

MCA TorontoSafety Training

The Mechanical Con-tractors Association ofToronto (MCAT) hasbeen hosting a variety ofsafety courses in its newclassroom. In July,MCAT held sessions onWorking at Heights, Ba-sics of Supervising andStandard First Aid andCPR. These well at-

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The Need For Prompt PaymentContinued From Page 5

10 per cent of invoices, the effect wasto increase the average, but more im-portantly, to introduce a much higherdegree of uncertainty into overallcash-flow. For contractors who hadcommitted all or a large proportionof their resources to a single project,the seriousness of the increase incash-flow risk was considerable.

Cash RequirementsAll businesses require a certain

amount of cash to finance their on-going operations. Figure Three showsthe amount of cash and short-termdeposits needed to support $1,000of operating expenses in the construc-tion industry from 1999 to 2009.

As can be seen from Figure Three,the amount of cash needed to sup-port $1000 of operating expensesincreased from $73 in 2000 to $123 in2010 and then fell back to $116 in2011. This was an increase of almost59 per cent in the amount of cashthat a construction company needsto finance $1000 of operating ex-penses. The increase arose from twofactors. The first was stricter borrow-ing conditions, which caused compa-nies to rely on self-financing to agreater degree. The second was in-creased caution on the part of con-struction business related to the in-crease in payment risk that was evi-dent in Figure One.

The Consequences of Late PaymentsIncrease in ‘Lean Times’

Writing in the Journal of Commerce,one legal commentator observed thata contingent payment clause “givesrise to special problems in times ofrecession.”1 The experience of manycontractors is that in ‘lean times’ thereis an increase in both the frequency

and the risk of late payment. Theconsequences for contractors are seri-ous. In ‘lean times’, banks are morestringent in their credit requirements,especially for small- and medium-sized businesses. Typically banks re-duce the amount of credit they willmake available for a given amount ofreceivables. The result is that contrac-tors need more cash at the same timethat those higher up on the pyramidare slowing down the flow of funds.Those contractors that are unable tomarshal additional cash resourceshave no choice but to cut back on theamount of work they undertake. Theoverall result is that, in ‘lean times’, latepayments magnify job losses in the con-struction industry at precisely the timewhen public policy is striving to minimizejob losses.

The Financing Costs of one Contractorare the Financing Gains of Another

In construction, as in other indus-tries, time is money. Materials and

wages must be paid as the work isperformed. Whenever the flow ofthat money down the constructionpyramid is interrupted, additional fi-nancing costs are imposed on thosesub-contractors who are forced to waitfor payment beyond the normal invoic-ing period.

However, the entity that is hold-ing back the monies is enjoying acommensurate financing gain. Eitherthat entity can earn interest on the idlefunds or (more likely) it can avoidbank borrowing. Late payments imposefinancing costs on those further down theconstruction pyramid while, at the sametime, providing an unwarranted financinggain to those higher up the pyramid. Thisis not only unfair, but late paymentpractices also impose additional costson the construction industry and havenegative consequences for theeconomy as a whole. To see how thesenegative consequences arise, it is im-portant to understand how contrac-

Continued On Page 7

FIGURE THREE – Amount of Cash and Deposits Supporting $1000 ofOperating Expenses in the Construction Industry, Canada, 1999 – 2011– Calculations based on Statistics Canada, CANSIM Table No. 180-0003

tended courses will once again be held this fall.Don’t forget, MCAT also offers Confined Space training on a site

specific basis, including a procedure for that site. Please contact Wendy Pageat wendypage@mcat.on.ca to discuss your safety training needs further.

MCAT PIPELINE - Summer 2013 7

WSIB UPDATE

Pickering AirportA REALITY

tors respond to the risk of latepayment.

MANAGINGLATE PAYMENT RISK

Managing late payment risk iscritically important to the survivalof a construction business. Thereare six ways that contractors man-age the risk of late payment. Allof these have negative implica-tions for the economy.

1. Holding Down PayrollCommitments: For a givenamount of working capital, thereis an inverse relationship betweenthe level of payment risk and em-ployment. Figure Four illustratesthe inverse relationship betweenpayment risk and employment.

In Figure Four a reduction oflate payment risk from R1 to R2

leads to an increase in a contrac-tor’s capacity to take on additionalwork. This is shown by the move-ment along the employment linefrom E1 to E2. Conversely, an in-crease in the level of late paymentrisk, as happened over the pastseveral years, reduces the amountof work that a contractor will takeon. One of the most important

The Need ForPrompt Payment Continued From Page 6

and adverse economic conse-quences of increased payment riskis that it leads to less employmentthan would otherwise be the case.

2. Ratcheting Up theNumber of ‘Independent Op-erators’: Late payment risk en-courages contractors to restructuretheir work force to utilize a greaternumber of ‘independent opera-tors’. The reason for this is that‘independent operators’ can betreated as sub-contractors for pur-poses of off-loading payroll risk2.This practice fosters the ‘under-ground economy’ by eliminatingdeductions-at-source for incometax, complicating coverage underworkers’ compensation and cre-ating ambiguities about whetherworkers enjoy the protection oflabour standards and are entitledto EI benefits.

Figure Five shows the growthof ‘independent operators’ as ashare of the construction workforce in Ontario. As can be seen,the independent operator share ofconstruction employment isroughly double what it was in thelate 1980s.

Continued On Page 8

FIGURE FOUR – Relationship Between Trade Contractors’Risk of Late Payment and Capacity to Carry Employment

FIGURE FIVE – Independent Operators as a Percent of TotalEmployment in the Construction Industry Ontario – 1987-2012

Breaking ground on the new Pickering Airport site are (from left) Provincial Minister of Transpor-tation, Glen Murray; Federal Finance Minister, Jim Flaherty; Federal Environment Minister, PeterKent; and MP representing Ajax-Pickering, Chris Alexander.

FLIC

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Responsible, balanced approach for the future of the Pickering Landsends decades of uncertainty: Lands are being committed for anairport, economical development and a national urban park

The federal governmenthas announced that anew airport in Pickering,Ont., will be constructedon the Pickering Lands,

ending what the finance minister

called “decades of uncertainty” abouta parcel of property that has long lan-guished without a plan for its future.

“For residents of Durham Regionand the GTA, the Harper govern-ment is ending decades of uncertainty

about the future of the PickeringLands,” said Finance Minister, JimFlaherty. “There will be land for anairport, there will be urban and in-dustrial development, and there willbe considerable green space on theselands. We are striking a responsiblebalance that will allow us to preserveour quality of life, while creating jobsand long-term prosperity in DurhamRegion and the GTA. WithButtonville Airport closing, withHighway 407 being extended east-ward, and now clarity around thePickering Lands, Durham Region iswell positioned to be a hub for trans-portation, business development andjob creation.”

The Pickering Lands encompassapproximately 18,600 acres of landin Pickering, Markham and Uxbridge(56 kilometres northeast of down-town Toronto). The lands were ac-quired by the Canadian governmentin 1972, and retained for a possiblefuture airport.

Transport Canada released aNeeds Assessment Study in 2011 that

Continued On Page 8

T

8 MCAT PIPELINE - Summer 2013

The Need For Prompt PaymentContinued From Page 7

It is not the argument of this re-port that payment risk is the soledriver behind the increase in thenumber of ‘independent operators’.However, the risk management ben-efit of employing ‘independent op-erators’ rather than regular employ-ees, will not be lost on a contractor.Payment risk adds to the other incen-tives to restructure employment infavour of ‘independent operators.’The implications of this trend for‘underground practices’ in the con-struction industry have been de-scribed elsewhere.3 Among the mostimportant of these are evasion ofincome tax and premiums for work-ers’ compensation coverage.

3. Reducing Investment in Ap-prenticeship: New apprentices are anet cost to an employer, at least dur-ing the first year of training and some-times longer. This net cost is the em-ployer’s investment in the apprentice.In most trades, the investment is re-couped in the latter half of the ap-prenticeship period. Consequently, tobenefit from this investment, an em-ployer must plan on retaining an ap-prentice. Taking on an apprentice,therefore, entails a long-term employ-ment. The willingness of an em-ployer to take on employment com-mitment is reduced by an increase inpayment risk. This is because an in-crease in payment risk reduces the will-ingness of employers to take on long-term, fixed payroll costs.

The construction industry’s in-vestment in apprenticeship is impor-tant. Roughly 40 per cent of all ap-prenticeships originate in the con-struction industry.

4. Reducing Productivity: Anincrease in payment risk reduces thatamount of fixed costs that a contrac-tor will take on. This implies limitinglease or purchase commitments fornew machinery and equipment. Theimpact of this is to hold down pro-ductivity growth. Figure Six showstrends in labour productivity for theconstruction industry, compared withall goods-producing industries andall services-producing industries.

As can be seen in Figure Six, since1990, labour productivity in both thegoods-producing and the services-producing industries increased byapproximately 35 per cent. By con-trast, labour productivity in the con-struction industry did not show anysimilar trend to sustained productiv-ity growth.

5. Factoring Late Payment Riskinto Bids: Financing late paymentsand bearing the risk of late paymentsentail real, financial costs for bothtrade contractors and general contrac-tors. This cost was described in astudy for the Irish government:

“… bad payment practices in theconstruction industry can give rise to

substantial additional financing and trans-action costs as well as consuming con-siderable skilled resources in dealingwith disputes over payment thatcould otherwise be put to productiveuse.” 4

Faced with the risk of late paymentcontractors are obliged to factor intotheir bids a margin to compensate forthis risk, even when it does not material-ize. This point is emphasized byHendrickson in Project Management forConstruction:

“Since contractors do not havelarge capital assets, they typically donot have large amounts of creditavailable to cover payment delays.Contractors are also perceived as credit risksin many cases, so loans often require a pre-mium interest charge. Contractors facedwith large financing problems arelikely to add premiums to bids…” 5

A study of sub-contracting in theelectrical contracting sector came to thesame conclusion, even though itstated its finding in the obverse,namely that when late payment riskis taken off the table, bids are lowerthan they otherwise would have been:

“… when specialty contractors donot bear the risks associated with thesingle prime contracting methods (i.e.,bid shopping and payment delays)they are willing to lower their bids and forgothe premium they would normallycharge…” 6

Survey data reported by the Engi-neering News Record support the con-clusion that late payment risk isfactored into construction costs.When contractors were presentedwith ‘pay-when-paid’ clauses, 68 percent reported that they increased theirbid prices. Half of these indicatedthat they increased their bid price bymore than five per cent. When tradecontractors are unfamiliar with a gen-eral contractor or an owner/developer(if they are in a direct contractual rela-tionship), three-quarters report thatthey increase their bid price, with 40per cent saying that they do so by fiveto 10 per cent. Fully 90 per cent ofsurvey respondents indicated thatthey ‘pad’ their bid in circumstances

where there is a poor reputation forprompt payment.7

In his review of the factors lead-ing to the adoption of prompt pay-ment legislation in the U.S. federaljurisdiction, William Arnold com-ments that public sector constructioncosts were higher than necessary be-cause both general contractors andtrade contractors were factoring in thefinancing costs and risk costs of deal-ing with late payments.8

The foregoing discussion leads toa straight forward conclusion: costs arehigher than they need to be even on projectsthat maintain a prompt payment cycle. Thereason for this is that the risk of latepayment causes contractors to add amargin to their bids to compensatefor the potential financial costs. A con-tractor cannot know in advancewhether payment will be received inaccordance with the invoicing cycle.Consequently, projects that adhere toa prompt payment policy will stillhave construction costs that are higherthan they need be. In effect, thoseprojects are paying for the poor paymentpractices on other projects.

6. Reducing the Bidding Pool:Contractors also respond to the riskof late payment by declining to sub-mit bids. This can arise for two rea-sons. The first is that late paymentrisk reduces the amount of work thata contractor can take on with a givenamount of working capital. A con-tractor may have the organizationalresources to take on additional work,but will be constrained from doingso because their business has hit thelimit on the amount of payment riskit can carry. A second and related causeof passing on bidding opportunitiesmay be the reputation of those higherup on the construction pyramid forimposing payment delays. Prudentcontractors will demur when pre-sented with the opportunity to bidon such work. Less cautious, and of-ten less diligent contractors, may pur-sue the work, but usually at a cost toquality and performance. The result offew bidders is less competition and a ten-

Continued On Page 11

FIGURE SIX – Index of Labour Productivity – Canada 1990-2010

Pickering Airport A RealityContinued From Page 7

indicated an additional airport inthe region will be needed between2027 and 2037, when capacity at ex-isting airports in the GreaterGolden Horseshoe area is pre-dicted to be reached. At the time,the Canadian government com-mitted to developing a plan for thePickering Lands.

“As we protect land for a futureairport, a considerable tract of landwill also be made available for job-creating development that willbring new opportunities toPickering and Durham Region,”Flaherty said. “

Since 2011, the south-east quad-rant of the existing lands has beenidentified as the site for a futureairport. As a result, the westernportion (approximately 5000 acres)will be transferred to Parks Canadato form part of the future RougeNational Urban Park. This newpark will be more than 13 timesthe size of Stanley Park in Vancou-

ver, BC.“As announced in the 2011

Speech from the Throne and Eco-nomic Action Plan 2012, our gov-ernment is working with provin-cial, regional, municipal, Aborigi-nal and community partners to-wards the creation of a nationalurban park in the Rouge Valley,”said Environment Minister PeterKent. “With federal and provin-cial commitments for lands, we arenot one, but two steps closer tocreating a true ‘Canadian first’ withRouge National Urban Park – aplace where nature, culture andagriculture can be protected, appre-ciated, experienced and sup-ported.”

Transport Canada plans tomeet with stakeholders, busi-nesses and local communities forfeedback on the management ofthe remaining Pickering Lands.The airport is tentatively sched-uled to be built by 2027.

MCAT PIPELINE - Summer 2013 9

ICI MARKET TRENDS

mands. The logistics network at Descois designed so that they can move prod-uct from one branch to another,through the night, so it can be in thecustomer’s hands the next morning.

Desco also employs its own driv-ers, unlike many distribution firmsthat use third party logistics compa-nies. This enables drivers to actuallybuild relationships with customersand get a solid understanding oftheir needs.

It is essential in today’s businessworld to form strong vendor rela-tionships if you expect your businessto grow. Desco is extremely proud todistribute products from industryleading manufacturers such asVictaulic, Bibby, IPEX, Kitz, Brad-ford White, Luxaire, TOTO, Ameri-can Standard, Moen and Delta. Descoalso carries a full-line offering of cop-per pipe and fittings; steel pipe andfittings; weld fittings and flanges;

hangers and valves. Whether your re-quirements are relative to rough-in orfinishing, the company will have whatyou need to get the job done.

Desco has also grown significantlyin the HVAC and hydronic marketsover the past 10 years. The heatingteam at Desco offer heat loss and heatgain calculations, duct design services,in-floor loop layouts for hydronicssystems, equipment sizing and more.The company has BCIN (BuildingCode Identification Number) certifiedstaff that can help design, quote, sup-ply and deliver on any aspect of a heat-ing project from start to finish.

The other cornerstone of successat Desco is its sales team. One of themost experienced and dynamicgroups in the industry, the Descosales team knows that the needs ofevery customer are not the same.Therefore, Desco customers gain ac-cess to a dedicated sales rep that serves

as a liaison for all their day-to-day re-quirements. The company’s sales rep-resentatives are experts in identifyingthe needs of a customer, and sug-gesting and implementing solutionsto meet those needs.

Desco has also recently becomeactive in various social media chan-nels as well. In the last year the com-pany has become more interactivewith its customers through mediaportals such as Facebook, Twitter,LinkedIn and YouTube.

“Desco personnel realize that thenext generation of contractors aremuch more comfortable operating ina web-based environment, so whatbetter way to communicate upcomingpromotions, events, contests andcompany news,” Leeson said.

For more information, please contactDesco at (800) 561-5146 or visit the com-pany’s web site at www.desco.ca to find alocation near you.

Desco Plumbing & Heating Supply Continued From Page 2

factured the pipes according to the specifications.Subsequently, the seal coat on the pipes began

delaminating and it was determined that this problemwas caused by the GVRD specifications. The GVRDsued under the warranty for repair costs. North Ameri-can Pipe successfully defended itself at trial, arguingthe warranty should be restricted to design errors madeby the supplier.

The Court of Appeal disagreed, saying the war-ranty applied regardless of whose design gave rise tothe defects. The lesson to be learned was succinctlystated by the court’s Mr. Justice Chaisson when hewrote:

“[Warranty clauses such as the one used in this con-tract] distribute risk. Sometimes they appear to do sounfairly, but that is a matter for the marketplace, notfor the courts. There is a danger attached to such clauses.Contractors may refuse to bid or, if they do so, maybuild in costly contingencies. Those who do not pro-

tentially disastrous consequences. Parties to construc-tion or supply contracts may find it in their best inter-est to address more practically the assumption of de-sign risk. To fail to do so merely creates the potentialfor protracted and costly litigation.

If you have any questions about this article, contact R.Glen Boswall at (604) 643-3125 or rgb@cwilson.com.

Contractor’s Warranty Triggered By DefectContinued From Page 1

GTA Permits UpdateIndustrial permit issuance increased to its highest first-

quarter level since 2008, pointing to further increases inactivity going forward. Indeed, CBRE (a commercial realestate services firm) notes that 4.3 million square feet ofindustrial space is currently under construction, which iswell above-average for the region.

Though down year-over-year, the value of first quartercommercial permits was still healthy at $700 million,building on a record 2012. With such strong activity, thedialogue may eventually turn to whether the market isbeing over-built.

After two years of out-sized permit issuance, the valueof institutional building intentions slipped to roughly$270 million, bringing it more in-line with its historicaltrend.

Permit ValuesJanuary to March 2013

Sector Value (in 000s) % Change

Industrial

Commercial

Institutional

Total ICI $1,175,181 -25.8%

$269,270

$699,783

$206,128

-55.3%

-12.1%

11.4%

tect themselvesfrom unknownpotential riskmay pay dearly.Owners are un-likely to benefitfrom circum-stances wheresuppliers andcontractors arefaced with theprospect of po-

10 MCAT PIPELINE - Summer 2013

SPECIAL FEATURE

Ride To ConquerCancer 2013Team MCAT Crew Raises Over$84,000 for Cancer Research

The Mechanical Con-tractors Association ofToronto (MCAT) wasonce again represented atthis year’s Enbridge Ride

to Conquer Cancer held June 8 and 9,2013.

This annual event draws thou-sands of participants and brings to-gether communities of cancer survi-vors, cyclists and supports who trainand fundraise in order to participatein the two-day, 200 km trek betweenToronto and Niagara Falls.

In its sixth record-breaking year,the Enbridge Ride to Conquer Can-cer continues to be the largest cyclingfundraiser in Canadian history, hav-ing raised over $99.3 million for ThePrincess Margaret hospital alone, and$194.6 million for cancer institutesacross Canada.

Jon Leeson of Desco Plumbing& Heating Supply, was captain of the2013 Team MCAT Crew, which con-sisted of 38 riders representing GTAwholesalers, manufacturers and me-chanical contractors.

This year’s event saw 5020 ridersparticipate with a total of $19.1 mil-lion being raised for The PrincessMargaret Hospital. This year’s MCATCrew also out-did last year’sfundraising total of $80,536, by rais-ing $84,657.60 this year.

“We extend our utmost gratitude

and well wishes to this incrediblecommunity of riders, crew members,volunteers, and their extended net-works of family and supporters forhelping to make the sixth annualEnbridge Ride To Conquer Cancerand overwhelming success,” saidPaul Alofs, president and CEO ofThe Princess Margaret Hospital Foun-dation.

“This year over 187,600 new can-cer cases will be diagnosed in Canadaand 75,500 Canadians will die fromthis horrid disease. As one of the topfive cancer research centres in theworld, The Princess Margaret (Hos-pital) is determined to conquer cancerin our lifetime. This vital $19.1 mil-lion raised is already powering Per-sonalized Cancer Medicine at the Prin-cess Margaret Cancer Centre, enablingthe continuity of world-leading re-search, treatment advances, education

Tand new standards of care right herein Toronto.”

The 2014 Ride will be held June 7and 8. Registration for this event is avail-able at www.conquercancer.ca.

MCAT PIPELINE - Summer 2013 11

The Need For Prompt Payment

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September 22 to 27 – MCAA Advanced Leadership Institute Course 13 - Part One, Babson College’s Educa-tion’s Executive Conference Centre, Wellesley, Massachusetts, USA.

September 25 to 28 – MCA Canada 72nd Annual National Conference – Fairmont Winnipeg, Winnipeg, MB.For more information, please visit www.mcac.ca.

October 4 to 6 – MCA Toronto 50th Annual General Meeting – The Rosseau, A JW Mariott Resort & Spa,Minett, Ont.

November 10 to 15 – MCAA Advanced Leadership Institute Course 13 - Part Two, Babson College’s Educa-tion’s Executive Conference Centre, Wellesley, Massachusetts, USA.

December 4 to 6 – Construct Canada Trade Show, Metro Toronto Convention Centre, South Building. MCAToronto Booth #641.

* Courses / seminars will be held in MCA Toronto’s classroom located at 595 Cityview Blvd., Unit 7, Vaughan, Ont.

For more information regarding the above, contact: The Mechanical Contractors Association of Toronto (MCAT), Tel:(416) 491-9004, Fax: (416) 491-9007, E-mail: McCabe@mcat.on.ca.

Continued From Page 8

dency to higher construction costs.7. Undermining the Level Play-

ing Field: Competitive neutrality, ora ‘level playing field’, means that noentity enjoys an undeserved advan-tage or suffers from an unwarranteddisadvantage in competing for busi-ness. There are both ethical and eco-nomic reasons to value competitiveneutrality. The ethical case for a ‘levelplaying field’ is self-evident in any so-ciety that values fair play. The economiccase is more subtle. Competitive neu-trality ensures that resources are allo-cated to entities that secure their com-petitive advantage by ‘gaming the sys-tem.’ As described in this report, latepayment risks cascade down the con-struction pyramid. The further downthe pyramid a party operates, the par-ty’s exposure to payment risk isgreater. Those at the bottom of thepyramid have little or no capacity tooff-load payment risk. Those owner-developers and contractors that abideby prompt payment norms are at acompetitive disadvantage comparedto those who engage in late paymentpractices to economize on their fi-nancing costs. In the long run, thepressure is on others to engage in thesame late payment practices. The ‘levelplaying field’ is not self-supporting.A ‘level playing field’ requires a statu-tory framework.

Payment risk causes constructionbusinesses to operate in ways thathave negative consequences for theeconomy:

(1) Employment is lower becausethe amount of operational spendingthat can be supported by a givenamount of working capital is reducedwhen payment risk increases.

(2) Off-loading payroll risk by in-creasing the number of ‘independ-ent operators’ increases the scope for‘underground practices’, notably evad-ing income tax and workers’ compen-

sation premiums.(3) Increased payment risk leads

to fewer apprenticeships because em-ployers are less willing to make thelong-term employment commit-ments that are required for an invest-ment in apprentice training to be re-couped.

(4) Increased payment risk leadsto avoiding fixed costs and thereforeto less investment in new machineryand equipment. In turn, this reducesthe long-term productivity trend.

(5) Construction costs are higherbecause contractors must factor intotheir bids the financing costs and therisk costs associated with late pay-ments.

(6) Construction costs are alsohigher because late payment risk re-duces the size of the bidding pool.

(7) Late payment practices putcompetitive pressure on others toadopt the same opportunistic con-duct. The result is an erosion ofstandards and an undermining ofthe level playing field which is essen-tial for a healthy market.

Part Four, to be published in the Fall2013 issue, will focus on How PromptPayment Would Work.

FOOTNOTES(1) MacEwing, J. Marc, “Navigat-

ing the perils of ‘pay when paid’,” Jour-nal of Commerce, Sep. 3, 2009.

(2) The term ‘independent opera-tor’ originates in workers’ compen-sation legislation. The term connotesa worker who is self-employed andwho does not employ any otherworkers. It is not relevant to this defi-nition whether the individual is in-corporated.

(3) The Ontario Construction Sec-retariat (OCS) has published anumber of studies that highlight therole of ‘independent operators’ in thegrowth of the ‘underground

economy’. Among these are: OCSUnderground Economy in Construction– It Costs Us All (July 2010); OCS –Attacking the Underground Economy inthe ICI Sector of Ontario’s ConstructionIndustry (April 2004).

(4) Eire, Government of, “Con-struction Contracts Bill, 2010: Summaryof Regulatory Impact Analysis,” Depart-ment of Public Expenditure and Re-form, September 2011,www.per.g ov. ie/w p-content/uploads/Regulatory-Impact-Analy-sis-of-the-Construction-Contract-Bill.pdf [Emphasis added]

(5) Hendrickson, Chris and TungAu, Project Management for Construc-tion, second edition, Version 2.2b (firstedition published by Prentice Hall)h t t p : / / p m b o o k . c e . c m u . e d /index.html - See Chapter 7 [Empha-sis added]

(6) Rojas, Eddy M., Single vs. Mul-tiple Prime Contracting, University ofWashington for Electric International– Foundation for Electrical Construc-tion Inc. (2007)

(7) Meir, Jonathan, “ProcurementRisk-Shifting Contracts Hurt,” Engi-neering News Record – “Viewpoint”web site, posted May 27, 2002,www.enr.construction.com/opin-i o n s / v i e w P o i n t / a r c h i v e s /020527.asp. The survey covered 512contractors with a 20 per cent responserate. Illustrative ‘pay-when-paidclauses’ used in the survey were takenfrom standard clauses appearing incontracts issued by the New York CityMetropolitan Transit Authority.

(8) Arnold, William G., ThePrompt Pay Act Answer Book, 2009,Management Concepts.

This article is part of an in-depth re-port prepared by Prism Economics andAnalysis detailing the need for PromptPayment legislation within the construc-tion industry.

MCA Toronto Supports PrincessMargaret Hospital Cancer Research

Representatives from the Mechanical Contractors Association of Toronto attended the Mas-ter Insulators’ Association of Ontario Inc. Golf Tournament on Aug. 9, 2013 at NobletonLakes Golf & Country Club. All monies raised at this event were donated to Princess MargaretHospital for Mesothelioma early detection and research. Presenting the $10,000 chequefrom MCA Toronto are (from left) Bud McWatters, MCAT Past President; Vince Di Gaetano,MCAT Past President, a leading Princess Margaret Mesothelioma Research physician, Dr.Marc de Perrot; Al Prowse, MCAT Vice President and Eric Pay, MCAT Past Associates Com-mittee Chair.

12 MCAT PIPELINE - Summer 2013

AC Mechanical Contractors Ltd.Mr. C. PickardTel: 905-829-1705, Fax: 905-829-1706

Active Mechanical ServicesMr. W. ParkesTel: 416-679-8410, Fax: 905-679-8594

Aecon IndustrialMr. J. GagneTel: 519-653-3200, Fax: 519-621-8430

Ainsworth Inc.Mr. S. StewartTel: 416-751-4420, Fax: 416-751-9031

Aldin Industrial Inst. Ltd.Mr. G.A. GreenTel: 905-849-6688, Fax: 905-845-2468

Analysts of Pneumatic Sys. Ltd.Mr. D. StrainTel: 905-640-2333, Fax: 905-640-2444

Aqua Mechanical Contracting Ltd.Mr. M. RizzoTel: 905-608-2782, Fax: 905-608-2783

BSG Systems Group Inc.Mr. S. McLeanTel: 905-829-1655, Fax: 905-829-5996

Baragar Mech. Inst. Ltd.Mr. A. LombardiTel: 416-232-1777, Fax: 416-232-1239

Battaglia Mech. ServicesMr. M. BattagliaTel: 905-415-2136, Fax: 905-415-2137

Bennett Mechanical Inst. Ltd.Mr. A. QuinnTel: 905-689-7242, Fax: 905-689-7289

Bering Mechanical Ltd.Mr. D. BelluzTel: 416-231-1414, Fax: 416-234-0827

Bird Mechanical Ltd.Mr. B. BirdTel: 905-888-9339, Fax: 905-888-6009

Black & McDonald Ltd.Mr. D. BennettTel: 416-366-2541, Fax: 416-361-3170

Bomben Plumbing & Heating Ltd.Mr. E. BombenTel: 905-565-0300, Fax: 905-565-0822

Brady & Seidner Assoc.Mr. J. LongariniTel: 416-661-1981, Fax: 416-661-8351

Brooklin Mechanical Inc.Mr. B. McKenzieTel: 905-425-0512, Fax: 905-425-0710

Christal MechanicalMr. J. RaspaTel: 416-740-8818, Fax: 905-761-8565

Class 1 Inc.Mr. C. OverTel: 519-650-2355, Fax: 519-650-2366

Clima Mech. Contrs. Ltd.Mr. C. DefulviisTel: 905-851-1562, Fax: 905-851-1631

CMS Commercial Mech. Srv. Ltd.Mr. C. LaceyTel: 416-609-9992, Fax: 416-609-9597

COFELY AdeltMr. S. MunroTel: 905-812-7900, Fax: 905-812-7907

Comstock Canada Ltd.Mr. G. BirkbeckTel: 905-335-3333, Fax: 905-335-3169

Con-Trak Mech. ServicesMr. R. ColmerTel: 416-332-0335, Fax: 416-332-0447

Crossby Dewar Inc.Mr. J. de WitTel: 905-619-5120, Fax: 905-683-6778

Culliton Brothers Ltd.Mr. T. CullitonTel: 519-271-1981, Fax: 519-273-4885

Danton Mech. Contrs. Ltd.Mr. D. ClaramuntTel: 905-683-8054, Fax: 905-683-7398

Dependable Mech. Systems Inc.Mr. R. AhujaTel: 905-660-9144, Fax: 905-660-9145

Dolvin Mech. Contrs. Ltd.Mr. I. DiBonaventuraTel: 416-653-6504, Fax: 416-653-9798

Wm. Elliott Ltd.Mr. G. ElliottTel: 416-755-3371, Fax: 416-755-3165

English & Mould Mech. Contractors Inc.Mr. D. SmithTel: 905-857-7778, Fax: 905-857-9150

E.S. Fox Ltd.Mr. E. DownesTel: 905-354-3700, Fax: 905-354-5599

Firenza Plumbing & Heating Ltd.Mr. P. BaldassarraTel: 416-247-7100, Fax: 416-247-4575

Gauge Mechanical Services Inc.Mr. S. BickleTel: 905-832-9932, Fax: 905-417-5982

GH Medical Inc.Mr. M. PaquetteTel: 905-455-6771, Fax: 905-455-5088

Y.A. Gibb Inc.Mr. A. GibbTel: 905-436-7591, Fax: 905-436-6950

Gimco Ltd.Mr. D. CapotostoTel: 905-475-2920, Fax: 905-475-8249

Gorbern Mechanical Ltd.Mr. K. CollinsTel: 416-292-4277, Fax: 416-292-0961

Grace Instrumentation & Controls Ltd.Mr. T. GraceTel: 519-583-0807, Fax: 519-583-3702

Greenock Mechanical Ltd.Mr. D. SalmonTel: 416-439-5962, Fax: 416-291-0073

H. Griffiths Co. Ltd.Mr. A. ProwseTel: 905-850-7070, Fax: 905-850-7091Grist Mechanical Inc.Mr. D. GristTel: 905-629-1977, Fax: 905-629-1981GTA MechanicalMr. F. TuranoTel: 416-621-9991, Fax: 416-621-9983Heritage Mechanical Ltd.Mr. B. DalimonteTel: 905-738-0433, Fax: 905-738-6257

Hi-Rise Mechanical Inc.Mr. L. CarinciTel: 905-660-3444, Fax: 905-660-3448

Honeywell Ltd.Mr. P. ChowTel: 289-333-1000, Fax: 289-333-1333

Impact Mech. & Elec. Ltd.Mr. D. GormanTel: 905-219-0008, Fax: 905-219-0078

J.G. Mechanical Contracting Inc.Mr. J. GervasioTel: 905-660-5740, Fax: 905-660-4674K & S Plg. & Htg. Ltd.Mr. K. MautnerTel: 416-439-9904, Fax: 416-439-0512

Geo. A. Kelson Co. Ltd.Ms. M. KelsonTel: 905-898-3400, Fax: 905-898-5491

Kent McWatters Welding Co. Ltd.Mr. K. McWattersTel: 416-990-5957, Fax: 905-775-9012

Kingsgate Plumbing & Drain Inc.Mr. J. FernandesTel: 905-420-3557, Fax: 905-420-0879

Lisi Mechanical Ltd.Mr. B. LisiTel: 416-674-8333, Fax: 416-674-5399

Lockerbie & Hole Eastern Inc.Mr. L. ColemanTel: 800-669-2083, Fax: 519-751-9108Mack Mechanical Solutions Inc.Mr. A. MackTel: 905-760-5565, Fax: 905-760-7545Mapleridge Mechanical Contracting Ltd.Mr. R. AllinghamTel: 905-831-0524, Fax: 905-831-1628

Masen Mechanical Inc.Ms. M. SecaTel: 905-264-2012, Fax: 905-264-2013

McWatters Mechanical Ltd.Mr. A. McWattersTel: 905-727-2420, Fax: 905-727-7280

W. Mitchell & Son Mech. Contractors Ltd.Mr. C. MitchellTel: 905-831-7691, Fax: 905-831-4673

Modern Niagara Toronto Inc.Mr. B. SilbersteinTel: 416-749-6031, Fax: 416-749-4673

Motion Mechanical Contractors(2002) Inc.Mr. P. CarinciTel: 905-850-2911, Fax: 905-850-2673

MSB Mechanical Ltd.Mr. M. BlackTel: 905-235-4997, Fax: 905-235-4977

Multiwide Mechanical Contractor Ltd.Mr. F. DassaTel: 905-761-0777, Fax: 905-761-5790

Municipal Mechanical Contractors Ltd.Mr. U. MorresiTel: 905-794-0800, Fax: 905-794-1146

Nelson Welding Ltd.Mr. A. BokmaTel: 416-742-9180, Fax: 416-742-6897

NMI Technical Services Inc.Mr. S. NewlandsTel: 905-666-8213, Fax: 905-666-3079

Pankhurst Mechanical CompanyMr. S. PankhurstTel: 416-892-0195, Fax: 289-240-6564

Peeltown Welding Ltd.Mr. M. ClicheTel: 905-677-4437

Pipe-All PlumbingMr. F. CascheraTel: 905-851-1927, Fax: 905-851-2002

Piping Solutions Inc.Mr. S. RuggTel: 416-778-5151, Fax: 416-466-3986

Pivot SystemsMr. K. SarichTel: 416-466-5127, Fax: 416-466-7122

Plan Group Inc.Mr. B. McDonnellTel: 416-635-9040, Fax: 416-373-4157

Pneumatemp Systems Ltd.Mr. J. DaweTel: 416-746-4883, Fax: 905-478-8667

Pro-Tek Mechanical Inc.Mr. J. ZarbTel: 905-683-8315, Fax: 905-683-6231

Ram Mechanical Ltd.Mr. G. InglisTel: 905-795-9758, Fax: 905-795-9794

Robert B. Somerville Co. Ltd.Mr. K. AbrahamTel: 905-833-3100, Fax: 905-833-4368

Roberts Onsite Inc.Mr. T. WalkerTel: 519-578-2440, Fax: 519-578-2979

Rom-Tal Mechanical Inc.Mr. J. RomanoTel: 905-951-7057, Fax: 905-951-6495

Royal Mechanical Inc.Mr. V. DiGaetanoTel: 905-857-7002, Fax: 905-857-8002

M. Schultz MechanicalMr. B. HickmanTel: 905-881-6444, Fax: 905-881-3849

Sprint-Insight Inc.Mr. A. SalvatoreTel: 416-747-6059, Fax: 416-747-6903

The State Group Industrial LimitedMr. K. LewisTel: 905-293-7420, Fax: 905-672-1919

Stellar Mechanical Inc.Mr. T. Di GiuseppeTel: 416-748-8088, Fax: 416-748-8288

W.A. Stephenson Mech. Cont. Ltd.Mr. J. LowTel: 905-362-2175, Fax: 905-362-2176

Sutherland SchultzMr. J. ThomasTel: 519-653-4123, Fax: 519-653-3232

Torek Plg. & Mech. Ltd.Mr. D. KiteTel: 416-889-8819, Fax: 416-244-8909

Acudor - Jay R. SmithMr. S. SantamariaTel: 905-427-9957, Fax: 905-427-7354

Anvil International CanadaMr. R. EllisTel: 800-661-8998, Fax: 519-426-5509

Aon Reed Stenhouse Inc.Mr. C. QuennevilleTel: 519-430-7440, Fax: 519-672-3425

S.A. Armstrong Ltd.Mr. A. DubierTel: 416-755-2291, Fax: 416-757-9377

Barantas Inc.Ms. E. OliverTel: 416-410-4470, Fax: 905-875-3582

Bardon Supplies Ltd.Mr. B. RaycroftTel: 613-966-5643, Fax: 613-966-2026

Bibby-Ste-CroixMr. G. StuempfleTel: 416-818-2946, Fax: 519-249-0404

Blaney McMurtry LLPMr. M. GeigerTel: 416-593-1221, Fax: 416-593-5437

Bradford White Canada Inc.Mr. D. MilroyTel: 905-238-0100, Fax: 905-238-0105

Cello Products Inc.Mr. P. HowellTel: 800-265-7882, Fax: 519-621-4108

C.I.B.C. Wood GundyMr. P. O’keeffeTel: 416-369-2224, Fax: 416-369-7683Conbraco Industries Inc.Mr. J. CooperTel: 905-761-6161, Fax: 905-761-6666Corporate Safety ManagementMr. R. PartingtonTel: 416-720-8704, Fax: 905-686-9131

Crane SupplyMr. G. KellawayTel: 416-244-5351, Fax: 416-244-1734

Desco Plg. & Htg. SupplyMr. L. MooreTel: 416-213-1555, Fax: 416-798-9541

Dobbin Sales Ltd.Mr. B. LaingTel: 905-264-5465, Fax: 905-264-8445Emco CorporationMr. P. SilverbergTel: 416-748-4000, Fax: 416-747-7968Engineered AirMr. B. RochefortTel: 905-602-4430, Fax: 905-602-4546Federated Insurance Company of CanadaMr. M. Di TullioTel: 800-361-0790, Fax: 450-687-6663Garth IndustrialMr. B. YoungTel: 416-747-0511, Fax: 416-747-0445Glaholt LLPMr. C. WiebeTel: 416-368-8280, Fax: 416-368-3467Goodmans LLPMr. H. WiseTel: 416-979-2211, Fax: 416-979-1234Grundfos Canada Inc.Mr. D. MurfinTel: 905-829-9533, Fax: 905-829-9512GSW Water HeatingMr. W. KubilisTel: 519-843-1610, Fax: 519-787-5525Hill SuppliesMr. A. PerryTel: 905-883-0633, Fax: 905-883-0777Hilti (Canada) LimitedMr. S. BlayTel: 800-363-4458, Fax: 800-363-4459

HKMB International Insurance BrokersMr. S. BeitelTel: 905-948-0700, Fax: 905-948-0966

Independent Mechanical SupplyMr. G. TesterTel: 416-291-0048, Fax: 416-291-4565IPEX Inc.Mr. M. MercurioTel: 905-670-7676, Fax: 905-670-5295Kilmer Environmental Inc.Mr. E. CarneyTel: 905-890-8908, Fax: 905-890-8915LynCar Products Ltd.Mr. C. DaviesTel: 905-453-2400, Fax: 905-453-2404Marks Supply Inc.Mr. P. CormierTel: 519-578-5761, Fax: 519-743-2364Masco Canada Ltd.Mr. P. AshtonTel: 905-712-3030, Fax: 905-712-1456Mech Tech Marketing Inc.Mr. M. DunnTel: (416) 597-8663, Fax: (866) 296-6771

Motiontech Services Inc.Mr. F. MazzucaTel: 905-265-1775, Fax: 905-265-1776

Nailor Industries, Inc.Mr. G. DavieTel: 416-744-3300, Fax: 416-744-3360

N-Two Cryogenic Enterprise Inc.Mr. W. ChuckTel: 416-410-6487, Fax: 905-660-1635NobleMr. M. WilksTel: 905-760-6858, Fax: 905-760-6801Norton Rose OR LLPMr. R. CharneyTel: 416-216-4000, Fax: 416-216-3930Perks Publications Inc.Mr. M. NoskoTel: 905-430-7267, Fax: 905-430-6418Rheem Canada Ltd.Mr. G. GilbertTel: 800-268-6966 x.367, Fax: 800-200-5393Rosenberg & Parker of Canada Inc.Mrs. S. ThompsonTel: 416-218-1280, Fax: 647-591-2693Sherwood Plumbing Supplies Inc.Mr. G. IaboniTel: 905-677-8088, Fax: 905-677-5730Smillie, McAdams & Summerlin Ltd.Mr. R. ChewTel: 905-576-6900, Fax: 905-576-3900Stringer LLPMs. V. PonceTel: 416-862-1616, Fax: 416-862-7358Taylor Pipe SupportsMr. J. ConveyTel: 800-263-8652, Fax: 800-575-6902Trane Central OntarioMr. N. LjiljanicTel: 416-847-2820, Fax: 416-499-3615Trimble / AccubidMr. G. MarcelliTel: 905-761-8800, Fax: 905-761-1234Uponor Ltd.Mr. J. LeyteTel: 905-542-4708, Fax: 905-819-0351Vibro-AcousticsMr. J. ChmielewskiTel: 416-291-7371, Fax: 416-291-8049Victaulic Co. of CanadaMr. B. PinnockTel: 905-884-7444, Fax: 905-884-7446Watters Marketing Inc.Mr. G. WattersTel: 905-668-2135, Fax: 905-430-1654Watts IndustriesMr. D. PetrieTel: 905-332-4090, Fax: 905-332-8551

WolseleyMr. C. DunfordTel: 416-746-2171, Fax: 416-746-0795Zurn Industries Ltd.Mr. J. FesslerTel: 905-405-8272, Fax: 905-405-1292

Tormac Mechanical Contractors Ltd.Mr. M. CostanteTel: 905-828-7222, Fax: 905-828-9997W.M. Tough Contractors Ltd.Mr. W. ToughTel: 519-927-3792, Fax: 519-927-5827Ultimate Mechanical Services Inc.Mr. G. HendersonTel: 905-868-8001, Fax: 905-868-8009

Van Mechanical Inc.Mr. D. Di TullioTel: 905-793-9444, Fax: 905-793-9411Vanguard Mechanical Contracting Inc.Mr. J. FisherTel: 416-783-5936, Fax: 416-781-1798VR Mechanical Services Inc.Mr. V. RankineTel: 905-426-7551, Fax: 905-426-7164