The B.C./Yukon Court of Appeal has found a Yukon contractor was overpaid nearly $1 million for his work on a lengthy Whitehorse condo project.

In a decision made public Tuesday, three court of appeal justices concluded that the property's owner, Alex Shaman, overpaid the builder, Wayne Cunningham of Kareway Homes Ltd., by $915,597.28.

The case between the two men dates back to 2006. It began as an oral agreement to build a two-building condominium complex in Whitehorse.

The specific location of the units it not identified in the ruling.

The project is discribed as two buildings housing 10 condo units apiece.

Each unit would have two bedrooms and a den, with an attached two-vehicle garage.

Not long after the deal was struck, Shaman insisted they enter into an official written agreement. That was done in early February 2007, the court documents say.

The owner, Shaman's company 37889 Yukon Inc., invested approximately $1.9 million of its own money into the project. The rest was obtained through bank financing.

"The project was originally supposed to be completed by the end of December 2007, but in fact, substantial completion did not occur until late 2009,” says the ruling, written by Justice Chistopher Hinkson.

"The owner (Shaman) maintains that the total cost of the project was significantly in excess of the '07 estimate plus the agreed-upon extras.

"As a result of a disagreement between the parties about this alleged cost overrun, the builder (Kareway Homes Ltd.) ceased working on the project on September 28, 2009, and gave notice to the owner that it was terminating the contract and suing for damages.”

In his original decision, Yukon Supreme Court Justice Leigh Gower called the men "notoriously poor communicators.”

"I found at trial that Mr. Cunningham has a tendency to speak in very rapid-fire bursts of phrases, and frequently slurs his words together so that they are difficult to understand.

"Further, both he and Mr. Shaman have a tendency to speak in broken sentences, moving from one thought to another without a clear conjunction,” the justice said at the time.

"Mr. Shaman is also very soft-spoken and difficult to hear at times. Both persons were frequently indiscernible during their testimony, and I regularly had to ask each of them to repeat what they had said at various times.

"I find that this mumbling led to a degree of miscommunication between them.”

At trial, Cunningham insisted the parties had agreed to a contract which was partly in writing and partly oral and was in the nature of a "cost plus” contract, and that all of the extras charged to the project were agreed to by Shaman.

Shaman maintained that the contract was a "fixed price” contract, and that the appellant significantly exceeded the fixed price they agreed to.

In the end, Gower awarded Shaman more than $500,000, which included more than $311,000 for overpayment.

Now, the court of appeal ruled that last number was underestimated.

"The trial judge erred in reducing the amount of agreed upon extras; absent findings of recklessness or fraud, which were not present in this case, the balancing of risk agreed to by the parties to a fixed price contract should be respected,” a summery of the decision reads.

"As a result, the trial judge underestimated the overpayment by the respondent to the appellant by $603,826.03.

"The trial judge also made palpable and overriding errors in failing to assign any value to the project's unsold unit and in failing to credit the respondent with having paid for the cost of some of the items in the fixed price contract.”

The value of the project's one unsold unit, as well as other factors related to the project's profit, have been sent back to the trial judge for consideration.

Cunningham must pay the legal costs for both sides, the justices ruled.