Dawson City subcontractor says company that built Yukon Housing duplex owes them money

A subcontractor who worked on a new duplex in Dawson City, Yukon, says the company contracted by the Yukon government didn't pay them in full.

The Yukon Housing Corporation awarded the $1.5-million contract to Grey Customs, which is owned by Riley Grey. The duplex has a one-bedroom and a two-bedroom unit.

Grey Customs hired another local company, Gammie Trucking, to do groundwork on the site prior to the duplex going up.

Gammie Trucking owner Sylvie Gammie said everything was going smoothly with the contractor until the groundwork was completed in September 2022.

"[He] got us to do the job, then tried to get us to lower the price after we did the job," Gammie said. "[He] came to us for terms that if we would help him out and if he could give us post-dated cheques over the winter."

Gammie said they agreed, thinking they were helping out a local up-and-coming entrepreneur. However, she alleges that he missed payments.

"He made a few payments and then we left on holidays to Mexico," she said. "We missed noticing the December payment didn't go through. And ... we noticed the January payment didn't go through."

When Gammie contacted the bank to inquire about the issue, she said she was told that Grey had put a stop payment on all of the remaining post-dated cheques from December 2022 to March 2023. 

Gammie provided copies of the four returned cheques from Grey Customs to CBC News. Each one is made out to Gammie Trucking Ltd. for $18,000 and they are all marked by the bank as "payment stopped."

Yukon Housing Corporation awarded the $1.5-million contract to Grey Customs to build a duplex on 7th Avenue in Dawson City, Yukon. Subcontractors hired by Grey Customs said they're still waiting for payment. (Chris MacIntyre/CBC)

After learning of this, Gammie said she turned to a government program where subcontractors can file grievances and the territory will help ensure they're paid. But she was disappointed by the response.

"Apparently we missed the deadline by nine days," she said. "They wouldn't take our claim and they wouldn't help us."

'He's in the Cayman Islands'

Again, out of desperation, Gammie said she contacted the Yukon Housing Corporation to explain that her company was still owed $72,000 from Grey Customs, but that led to another dead end.

"They said, 'Oh no, Grey Customs signed an affidavit that they paid all their subcontractors, so we're not going to help you,'" Gammie said. "[They said], 'You can now take your own legal actions or whatever.'"

Gammie said they took take action in the form of a demand letter, followed by a lawsuit, but she believes Grey has left the country.

"He's in the Cayman Islands," she said.

CBC reached out to Riley Grey for comment but did not receive a response.

A December 2023 video posted to his social media account states he had plans to launch a surfing business in the Cayman Islands in 2024. More recent posts are of promotional videos for that surfing company, and appear to be filmed in the Cayman Islands.

Last summer, in 2023, while Grey was in town briefly, her husband presented the letter to Grey which told him he had seven days to pay the outstanding amount owed or else they'd take him to court.

Before the seven days were up, Gammie said Grey had left the city again, and she hasn't seen him back since.

Grey had been a longtime resident of Dawson City when his company was awarded the contract, and had previously won other construction contracts around the city.

Gammie said although business must continue as normal, this whole experience has left her with a very bad impression of the government.

"It just seems really wrong that their answer was, 'The guy signed that he had paid you,' she said. "Like is there any follow up on [the Yukon government's] part ?"

After Grey left town, Gammie filed a lawsuit against Grey Customs. The August 2023 statement of claim filed to the Supreme Court of Yukon claims the agreement between Gammie Trucking and Grey Customs for just over $100,000 was binding and enforceable. It asks the court to order that Grey Customs either pay the $72,000 or "alternatively, general damages for breach of contract, debt and unjust enrichment."

The claims against Grey have not been proven in court.

Gammie said that because Grey is away, they can't serve him the lawsuit. As a result the case is suspended indefinitely, she said.

Legislation outlines process

Philippe Mollet, acting vice-president of operations with the Yukon Housing Corporation, said disputes between general contractors and subcontractors are usually private sector matters.

"If a dispute ... is not resolved, then one of the parties has the option to take legal action through the court system," Mollet said.

Mollet said the Yukon government has implemented legislation that helps protect subcontractors through the contract and procurement regulation.

"The money remaining to be paid to a general contractor on the public work project can be reserved for payment to a subcontractor based on the outcome of the dispute, and/or the court action," he said. "Under regulation, in order to reserve such funds, subcontractors must file a claim at the procurement support centre within 120 days."

Mollet said in this particular case, because Gammie missed the deadline to submit, there is nothing the government can do.

"Contracts between two entities and here, in this specific case, between the contractor and subcontractor, is not the responsibility of Yukon Housing Corporation," he said.