Rebuilding the Books Before the Settlement Conference Resumed in Picton

The situation

By the time Femke came to our office, she had already tried almost everything a small contractor tries before calling a lawyer. She had sent two demand letters. She had offered to meet Saskia, the retail worker who owned the shop being renovated, in person to walk through the invoices line by line. She had even agreed to knock a small amount off the final bill just to get it resolved. None of it worked, and by the time she filed a claim in Small Claims Court and sat through a settlement conference that went nowhere, she was no closer to being paid than the day she sent her first letter.

The dispute was over a renovation Femke's small contracting business had done on a clothing shop Saskia ran, with build-out work extending into an adjoining unit that Samir, a hairdresser, was fitting out as a salon. The two spaces shared a wall and some of the same structural work, and Saskia and Samir had split the contract between them under a single project agreement. The written contract used the phrase 'fixed price for the scope described,' but the scope description itself was thin, and change orders had been handled informally over text messages as the work progressed. When the final invoice came in at roughly $22,000 above the original number, Saskia and Samir refused to pay the difference, arguing the contract was fixed price, full stop, and that anything beyond it was Femke's problem to absorb.

Femke's position was that the changes — moved outlets, an extra doorway, upgraded flooring after water damage was discovered mid-project — were plainly outside the original scope and had been agreed to, informally, as they came up. The trouble was that her own records did not make that easy to see. Her invoicing mixed original scope and change-order work together without separating them, and the settlement conference judge had noted, not unkindly, that neither side's paperwork made the story easy to follow, and had adjourned the matter to a later date rather than setting it down for trial, so that both sides could sort out their numbers before the case went any further.

The dispute sat in Small Claims Court territory, in the roughly $8,000 to $35,000 range, and Femke's own financial position was tight. She was not a large operation, and months of unpaid work on a project of this size had already put pressure on her ability to take on new jobs. She needed the matter resolved, not dragged out, but she also could not afford to simply write off the amount owed.

What was actually at stake

What was actually at stake was not just the roughly $22,000 in dispute. It was which reading of the contract would govern: a strict 'fixed price means fixed price' interpretation that would leave Femke absorbing every change made mid-project, or a reading that treated the contract's fixed price as covering only the scope described at signing, with anything beyond that priced separately by agreement, whether or not that agreement was ever formalized in writing.

This distinction mattered beyond this one project. If a fixed-price clause with a thin scope description could be read to swallow every later change a client verbally requested, it would make every contract Femke signed going forward far riskier for her business, since clients routinely ask for adjustments once work is underway. Small contractors rarely have the leverage to insist on a fully re-papered contract every time a client wants a moved outlet or an upgraded finish, and if the law read a bare fixed-price clause as absorbing all of that automatically, contractors like Femke would either have to eat those costs constantly or refuse reasonable requests outright. Getting the interpretation right here was as much about the principle for her future contracts as it was about this specific invoice.

The other side's position rested on a plausible-sounding but ultimately thin argument: that the words 'fixed price' meant exactly that, regardless of what was added later, unless a new written contract had been signed. If that argument won, Saskia and Samir would owe nothing beyond the original number, and Femke would be left having done roughly $22,000 of work for free, work that both of them had asked for as it came up and had watched being done without objection at the time.

The complication was that Femke could not simply assert the changes were outside scope and expect to be believed. Her invoices, as they stood, blended the original job and every change order into a single running total with no clear line between them. Without separating the two, a judge would have every reason to accept the other side's simpler story: one project, one fixed price, no exceptions. The numbers only made sense once someone actually rebuilt the accounting from the underlying job records, separating original scope from add-on work and matching each change to the text message or conversation that had authorized it. Until that work was done, Femke's own paperwork was, if anything, evidence for the other side's version of events rather than her own.

What we did

1. Pulled every underlying record behind the blended invoices. Femke had kept receipts, supplier invoices, site photos and text threads, but none of it had been organized by scope. We went through the full project file and rebuilt a line-by-line accounting that separated the original fixed-price scope from every later change, so the numbers could actually be checked against the contract language rather than taken on faith.
2. Matched each change order to a specific authorization. For every item outside the original scope, we located the text message, email or dated note where Saskia or Samir had asked for or approved the change. This turned a vague claim of 'they asked for extras' into a documented list, each entry tied to a date, a person and a specific instruction.
3. Identified the interpretation argument the case actually turned on. Rather than arguing generally that the invoice was fair, we focused the case on a single legal question: whether 'fixed price for the scope described' could reasonably be read to include work outside that described scope. Contract interpretation in a case like this generally looks at the words used, read in the context of what both sides understood at the time, not a strict literal reading in isolation.
4. Asked to bring the matter back before the settlement conference rather than proceed straight to trial. Because the first conference had been adjourned specifically so the numbers could be sorted out, we asked the court to reconvene it once the rebuilt accounting was ready. A settlement conference gives both sides a chance to present their positions to a judge and get an informal, non-binding read on the case before the cost and risk of a trial, and reconvening it let us test the interpretation argument on a real judge while the file was still open to it.
5. Watched how the other side's position held up under questioning. When the settlement conference judge asked Saskia and Samir's representative directly how a fixed-price clause with an undefined scope could reasonably capture unrelated later requests like a new doorway or a flooring upgrade prompted by water damage, the answer was noticeably weaker than the written argument had suggested. That moment told us the interpretation argument was likely to hold at trial too.
6. Built the settlement position around that signal. Rather than pushing straight to trial, we used the settlement conference judge's visible skepticism as leverage in settlement discussions immediately afterward, presenting Saskia and Samir with the same rebuilt accounting and the same authorization trail, and making clear in plain terms that a trial outcome was unlikely to look any better for them once the same evidence was tested again in front of a different judge.
7. Kept the pressure realistic and specific. We did not ask for more than the documented change orders supported, even on items where a stronger-sounding number might have been arguable. Holding the claim to exactly what the rebuilt accounting could actually prove made the settlement offer harder to dismiss as a negotiating tactic, and easier for the other side's advisor to recommend accepting rather than fight.

The outcome

Within a few weeks of the reconvened settlement conference, Saskia and Samir's representative came back with an offer close to the full amount Femke's rebuilt accounting supported. After a short negotiation over a handful of the smaller, less clearly documented items, the matter settled for roughly $19,500 of the approximately $22,000 originally in dispute, paid within a set schedule rather than as a single lump sum.

Femke gave up a small amount on the least-documented change orders rather than push those specific items to trial, a reasonable trade given that even strong cases carry some risk and the reconvened settlement conference had already done most of the work of showing where the case stood. The larger, well-documented items were paid in full, and the settlement avoided the further weeks of preparation and the trial date itself, which would have added cost on both sides regardless of who ultimately won.

This was a clear win, and the strategy that produced it is worth naming plainly: the settlement conference let Femke test her interpretation argument on a real judge, at low cost, before either side had spent the money and time a trial requires. Combined with accounting that could finally show, item by item, what belonged to the original scope and what did not, it turned a dispute that had stalled through two demand letters and a first settlement conference that went nowhere into one that resolved within weeks. The demand letters had failed because they simply repeated Femke's position without giving Saskia and Samir any reason to see it differently; the reconvened settlement conference worked because it let a neutral judge test that same position out loud, in front of the people who needed to hear it.

For Femke, the lesson carried past this one project. Her invoicing now separates original scope from change orders as a matter of course, with each change order requiring a short written confirmation before work begins rather than relying on a text exchange to be sorted out later. That single change should make the next dispute, if there is one, considerably shorter, and considerably less dependent on rebuilding months of records after the fact.

What you can learn from this