Ontario Court Considers United Nations Convention on Contracts for the International Sale of Goods on Summary Judgment Motion

Andrew Ottaway, B.A. (Hons.), LL.B.Civil Litigation, Commercial, Commercial and Contract Litigation, Commercial Litigation, Contract Disputes, Cross-Border Litigation, International Sale of Goods, Sale of Goods0 Comments

In Solea International BVBA v. Bassett & Walker International Inc., 2018 ONSC 4261, the Ontario Court of Appeal had directed the Superior Court to rehear a motion for summary judgment applying the provisions of the United Nations Convention on Contracts for the International Sale of Goods (“CISG”), representing a rare instance of the Ontario Court explicitly considering the CISG.   The case involved the sale of shrimp by the plaintiff to the defendant.  The defendant argued, among other things, that it was not required to pay for the shrimp because the plaintiff breached a fundamental term of the contract, being provision of  a Health Certificate with a statement guaranteeing that the shrimp was free of certain diseases. The defendant argued that as a result of breach of a fundamental term, it was entitled to declare the contract avoided (pursuant to Article 49 of the CISG). In rejecting that defence, the … Read More

Ontario Court of Appeal Considers Contractual Duty of Good Faith

Andrew Ottaway, B.A. (Hons.), LL.B.Commercial0 Comments

In CM Callow Inc. v. Zollinger, 2018 ONCA 896 (CanLII) the plaintiff company provided maintenance services to condos managed by the defendant condo corporations. The defendants entered in two two-year maintenance contracts with the plaintiff: one for summer maintenance and one for winter maintenance.  The winter contract (which ran from November 2012 to April 2014) allowed for early termination by the defendants on 10 days’ notice. In March or April of 2013, the defendants decided to terminate the winter contract, but did not provide notice of termination of the agreement until September 12, 2013.  The defendants delayed informing the plaintiff that they were terminating the contract in order to avoid interfering with the defendant’s work under the summer contract (which ran from May 2012 to October 2013).  The plaintiff provided free work in the summer of 2013 as an incentive for the defendants to renew the contracts. The defendants knew … Read More

Supreme Court Considers an ISP’s Right to Costs in Norwich Orders for Copyright Infringement

Peter Neufeld, B. Soc. Sc., J.D.Appeals, Appellate Advocacy, Civil Litigation, Commercial, Copyright Infringement, Intellectual Property, Norwich Order0 Comments

Norwich Orders have become a common tool to detect wrongdoers hiding behind the elusive veil of the internet. Whether the matter is with respect to defamation, intellectual property infringement, or fraud, the equitable remedy of pre-action discovery to compel Internet Service Providers (“ISPs”) to disclose a wrongdoer’s identity can help claimants determine their causes of action before they commence litigation. A question that has been raised, however, is who bears the costs of the Norwich Order? Is it the claimant seeking the Norwich Order or the ISP subject to the equitable remedy? To complicate the matter further, how does this interact with an ISP’s obligations under the “notice and notice” regime pursuant to Canada’s Copyright Act? By way of background, ss. 41.25 and 41.26 of the Copyright Act govern the statutory “notice and notice” regime for alerting alleged copyright infringers in Canada. These sections under the Copyright Act state that … Read More

Ontario Court Finds No Jurisdiction in Multinational Class-Action against Volkswagen

Andrew Ottaway, B.A. (Hons.), LL.B.Commercial0 Comments

In Leon v. Volkswagen AG, 2018 ONSC 4265 (CanLII), the plaintiff, who resides in Ontario, purchased American Deposit Receipts (ADRs) in respect of Volkswagen shares. The Volkswagen shares plummeted when Volkswagen disclosed that it had perpetrated fraud. Owners of the common shares commenced proceedings in Germany.  The plaintiff initially commenced a class action in respect of his ADRs in New Jersey. The plaintiff conceded in the New Jersey action that the US Federal Court had jurisdiction over the subject matter of the claim and that the venue was proper. However, the plaintiff later withdrew from the US proceedings and commenced the subject class action in Ontario.  The Ontario class action included Ontario purchasers of the ADRs and of common shares (unlike the US proceedings, which were in respect of ADR purchasers only).   Volkswagen brought a motion to dismiss the action on the basis that Ontario did not have jurisdiction … Read More

Federal Court of Appeal Considers Reviewing of Evidence in Judicial Review Applications

Peter Neufeld, B. Soc. Sc., J.D.Administrative Law, Appeals, Business Litigation, Civil Litigation, Commercial, Commercial Litigation, Judicial Review0 Comments

In judicial review applications, like most legal proceedings, evidence plays an essential role in securing a successful result. This includes not just the quality of the evidence, but the process through which the court considers that evidence. The Federal Court of Appeal’s recent decision in Apotex Inc. v. Canada (Health), 2018 FCA 147 (“Apotex”) affirms the control accorded to judges when reviewing evidence in judicial review applications.

Court of Appeal Considers Ontario Labour Relations Board’s Jurisdiction, Limitation Periods in Class Actions

Peter Neufeld, B. Soc. Sc., J.D.Administrative Law, Appeals, Civil Litigation, Class Action Defence, Commercial, Employment, Employment & Wrongful Dismissal, Jurisdictional Challenges, Tribunals, Wrongful Dismissal0 Comments

In United Food and Commercial Workers Canada, Local 175, Region 6 v. Quality Meat Packers Holdings Limited, 2018 ONCA 671 (“Quality Meat Packers”), the Ontario Court of Appeal considered (1) the Ontario Labour Relations Board’s (“OLRB”) jurisdiction to decide claims related to the wrongful dismissal of unionized employees; and (2) whether, in proposed representative proceedings under Rules 12.08 and 10.01, representation orders must be obtained during the limitation periods for the individuals’ claims.

When is Oral Evidence Required to Resolve Credibility Issues in Summary Judgment Motions?

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Appeals, Business Litigation, Civil Litigation, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Litigation, Contract Disputes, Contract Termination, Franchise | Licensing, Franchise Law, Summary Judgment0 Comments

The Ontario Court of Appeal decision in 2212886 Ontario Inc. v. Obsidian Group Inc., 2018 ONCA 670, involved the appeal of a partial summary judgment decision in a dispute between the franchisor and a franchisee of Crabby Joe’s Tap and Grill.  In this case, the franchisee operated a Crabby Joe’s franchise for a year and a half prior to serving a notice of rescission of the franchise agreement on the franchisor. Claims The franchisee claimed that the disclosure document provided was materially deficient and it was entitled to rescind the franchise agreement within two years of execution of the franchise agreement under section 6(2) of the Arthur Wishart Act (Franchise Disclousre), 2000 (“the Act”).   The franchisee claimed for rescission damages under section 6(6) of the Act and also damages for breach of contract and breach of the fair dealing obligations under the Act.  In response, the franchisor brought a counterclaim for a declaration that the franchise agreement was validly terminated and a … Read More

Entire Agreement Clause Upheld in Manorgate Estates Inc. v. Kirkor Architects and Planners

Janice Perri, B.A. (Summa Cum Laude)Appeals, Appellate Advocacy, Business Torts | Economic Torts, Civil Litigation, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Law, Commercial Litigation, Construction | Builders, Construction Litigation, Contract Disputes, Misrepresentation, Negligence, Real Estate | Developers, Real Estate Litigation0 Comments

Entire Agreement Clauses are meant to prevent negotiations that occurred prior to the contract being formed from influencing the Court’s interpretation of the terms set out in the final contract. In other words, past discussions are to have no bearing on the understanding of the contractual terms. In theory, a fully integrated agreement of this kind supplants any earlier oral or written agreements. There is competing jurisprudence in which Entire Agreement Clauses have been both effective and ineffective. However, Manograte Estates Inc. v. Kirkor Architects and Planners is a recent Ontario Court of Appeal decision where an Entire Agreement Clause was effective. In Manograte Estates Inc. v. Kirkor Architects and Planners, the Ontario Court of Appeal upheld the Motion Judge’s decision that the Entire Agreement Clause in the relevant agreement, regarding architectural consulting for a construction project, operated as a complete defence to the appellants’ claim of alleged negligent misrepresentation. The Entire Agreement Clause … Read More

Shareholders’ Remedies under the OBCA: An Overview (Part 2/2) 

Janice Perri, B.A. (Summa Cum Laude)Business Law, Business Litigation, Civil Litigation, Closely-Held Business Disputes, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Law, Commercial Litigation, Corporate Disputes, Corporate Litigation, Directors' and Officers' Liability, Oppression Remedies, Partnership Dispute, Partnerships and Shareholder Disputes, Shareholder Disputes0 Comments

When a shareholder’s rights are breached, there are a variety of legal remedies available under the Ontario Business Corporations Act (“OBCA”). For more information on shareholders’ rights, please click here to see part 1 of this post. Oppression Remedy It is first important to note that as per the Ontario Court of Appeal decision Maurice v. Alles, the standard two-year limitation period set out in the Limitations Act applies to oppression remedy claims. The “clock starts to run” when the oppressive conduct first began, meaning that individuals must not delay if they wish to pursue an oppression remedy. The oppression remedy under s. 248 of the OBCA is broad in nature, and there is a large amount of judicial discretion afforded in its application. The oppression remedy can be an especially strong tool in protecting minority shareholders. When the Court determines that there has been oppressive conduct, unfairly prejudicial conduct, or conduct that disregards the interests of any shareholder it may make an order to resolve the matter in a variety of ways. … Read More

Shareholders’ Rights under the OBCA: An Overview (Part 1/2) 

Janice Perri, B.A. (Summa Cum Laude)Business Law, Business Litigation, Civil Litigation, Closely-Held Business Disputes, Commercial, Commercial and Contract Litigation, Commercial Contracts, Commercial Law, Commercial Litigation, Corporate Disputes, Corporate Litigation, Directors' and Officers' Liability, Oppression Remedies, Partnerships and Shareholder Disputes, Shareholder Disputes0 Comments

Under the Ontario Business Corporations Act (“OBCA”), shareholders of a corporation have a variety of rights. Outlined below are a few rights that all shareholders should be aware they possess. Please click here to see part 2 of this post on shareholders’ remedies. Voting Rights The board of directors, under s. 115 are ultimately responsible for managing or supervising the management of the business and affairs of a corporation. Major business decisions also involve the participation of the board of directors, though sales, leases, or exchanges of all or substantially all the property of the corporation that is not in the ordinary course of business requires the approval of shareholders (s. 184(3)). Shareholders also have voting rights that allow them to control the makeup of the board of directors (s. 119(4)), and also the ability to remove directors under s. 122(1) (though this is subject to exceptions under s. 120(f)). Shareholders have additional voting rights under … Read More

The Supreme Court of Canada On Defence Against the Tort of Conversion (Teva Canada Ltd. v. TD Canada Trust)

Janice Perri, B.A. (Summa Cum Laude)Appeals, Appellate Advocacy, Business Law, Business Litigation, Business Torts | Economic Torts, Civil Litigation, Commercial, Commercial Law, Commercial Litigation, Employee Fraud, Finance Litigation, Financial Services | Investment, Fraud, Fraud Recovery, Fraudulent Schemes, Investment | Financial Services0 Comments

In Teva Canada Ltd. v. TD Canada Trust, Teva Canada Ltd. (“Teva”), a pharmaceutical company, “was the victim of a fraudulent cheque scheme implemented by one of its employees”, (para 1). Teva claimed the collecting banks were liable for the tort of conversion. Teva Canada Ltd. v. TD Canada Trust provides insight into the Bills of Exchange Act‘s (“BEA”) section 20(5) defence to the tort of conversion, by clarifying the approach used to determining whether a payee is “fictitious or non-existing”. In the event that a payee is deemed fictitious or non-existing within the meaning of section 20(5) of the BEA, the bill may be treated as payable to the bearer, and thus can be negotiated by simple “delivery” to the bank meaning endorsement is not required, and the defence will succeed (para 5). Justice Abella, writing for the majority, outlined the two-step framework a bank must satisfy to demonstrate that a payee is fictitious or … Read More

What Does the Illegal Substances Clause Mean in OREA Agreements of Purchase and Sale?

Nick P. Poon, B.Sc. (Hons.), B.A., J.D.Agents and Brokers, Appeals, Broker and Agent Claims, Civil Litigation, Commercial, Commercial Litigation, Contract Disputes, Contract Termination, Misrepresentation, Negligence, Real Estate Agent and Broker, Real Estate Litigation0 Comments

The Court of Appeal decision in Beatty v. Wei, 2018 ONCA 479, involved the failed closing of a residential property in Toronto and the proper interpretation of an illegal substances clause that is commonly found in OREA Agreements of Purchase and Sale. Illegal Substances Clause in OREA Agreement of Purchase and Sale In this case, about a month after entering into the Agreement of Purchase and Sale, the purchaser’s real estate agent discovered the property had been previously used as a marijuana grow-op in 2004.  The purchaser sought to terminate the agreement and demanded the return of the $30,000 deposit.  The sellers refused to terminate the agreement and commenced an application for a declaration that the purchaser breached the agreement by failing to close and an order that the sellers were entitled to the deposit and related damages.  In response, the purchaser commenced a competing application for similar relief. The dispute was in respect to … Read More

Business “One Step Removed” From Tort Liability: Rankin (Rankin’s Garage & Sales) v. J.J.

Janice Perri, B.A. (Summa Cum Laude)Appeals, Appellate Advocacy, Civil Litigation, Commercial, Negligence0 Comments

The neighbour principle derived from Donoghue v. Stevenson that underlies the Anns/Cooper test continues to animate all of tort law. The pendulum continues to swing regarding who we can properly call our “neighbours” for legal purposes. While limiting who qualifies as our neighbours is necessary to prevent indeterminate liability, a balance must be struck to ensure just and fair outcomes. Rankin (Rankin’s Garage & Sales) v. J.J., in a strong 7-2 decision, represents the Court attempting to strike such a balance. In Rankin (Rankin’s Garage & Sales) v. J.J. a 15-year-old Plaintiff, J., suffered a catastrophic brain injury as a result of being the passenger in a car accident that occurred after his 16-year-old friend, C., stole a car from Rankin’s Garage & Sales (paras 1-5). Justice Karakatsanis, writing for the majority of the Supreme Court of Canada, held that there was no duty of care owed in this case by a business that stores vehicles to someone who is injured following the theft of … Read More

Mattresses and Slogans and Interlocutory Injunctions, Oh My! (Sleep Country Canada Inc. v. Sears Canada Inc.)

Janice Perri, B.A. (Summa Cum Laude)Brand Protection, Business Law, Business Litigation, Civil Litigation, Commercial, Injunction & Specific Performance, Intellectual Property, Passing Off, Trademark Infringement0 Comments

In Sleep Country Canada Inc. v. Sears Canada Inc., Sleep Country Canada Inc. (“Sleep Country”) was granted an interlocutory injunction against Sears Canada Inc. (“Sears”) to prevent Sears from using their slogan “THERE IS NO REASON TO BUY A MATTRESS ANYWHERE ELSE” while the trade-mark infringement litigation (in which Sleep Country claims Sears’ slogan infringes on Sleep Country’s trade-marked slogan of, “WHY BUY A MATTRESS ANYWHERE ELSE”) is ongoing.   The three-part test set out in RJR-MacDonald v. Canada (Attorney General) was ultimately satisfied. The heart of the case was not on whether this was a serious issue or on the balance of convenience, but rather, on whether irreparable harm was established.   The Court found in favour of Sleep Country’s arguments that confusion, depreciation of goodwill, and loss of distinctiveness would result, as well as, a loss of sales in the minimum 18-24-month period between the time of this hearing and the determination of the … Read More

Grounds for Judicial Intervention on International Arbitral Awards – Key Takeaways

Janice Perri, B.A. (Summa Cum Laude)Appeals, Arbitration, Commercial, Commercial and Contract Litigation, Commercial Arbitration, Commercial Leasing, Commercial Litigation, Construction | Builders, Construction Litigation, Enforcement of Foreign Arbitral Awards, UNCITRAL0 Comments

In Consolidated Contractors Group S.A.L. (Offshore) v. Ambatovy Minerals S.A., a decision of the Court of Appeal for Ontario, a USD$258 million project for the construction of a slurry pipeline from a nickel mine in the mountains of Madagascar to the coast lead to arbitration between the appellant (the contractor) and the respondent (tendered the project). After mutually agreeing to by-pass the adjudication stage of their three-stage dispute resolution process and go straight to a Tribunal, the appellant was only awarded $7M of its $91M claim and the respondent was awarded nearly $25M on its counterclaim. These awards were challenged on appeal as being made without jurisdiction, in breach of procedural fairness, and violating public policy. However, the appeal was dismissed. Judicial intervention in international arbitral awards under the United Nations Commission on International Trade Law (UNCITRAL) Model Law (the “Model Law”) – though given the force of law by the International Commercial Arbitration Act … Read More

McDonald’s Not Served Valid Revocation of Waiver – Commercial Leasing in the Court of Appeal

David Alderson, LL.B, LL.M (Commercial and Corporate), Q.Arb, Lawyer and ArbitratorAppeals, Arbitration, Business Litigation, Commercial, Commercial and Contract Litigation, Commercial Arbitration, Commercial Leasing, Injunction & Specific Performance, Real Estate Litigation, Retail Litigation, Shopping Mall Lease Disputes0 Comments

The Court of Appeal for Ontario in North Elgin Centre Inc. v. McDonald’s Restaurants of Canada Limited, 2018 ONCA 71 allowed an appeal by McDonald’s from a decision on applications by both parties to determine whether  the subject lease came to an end on a described date because McDonald’s had not complied with the renewal provision in the lease. The Court of Appeal allowed the appeal of the decision of the application judge, that despite that the parties were in negotiations, and that the respondent had waived its right to insist on strict compliance with the  terms of the renewal provision (to refer the determination of the renewal rental rate to arbitration), that the respondent had effectively revoked its waiver and reverted to its strict legal rights, namely to terminate the lease in the absence of the referral of the dispute on renewal rental rate to arbitration within the permitted time. On the … Read More

Greater Harmonization of International Commercial Arbitration Laws

David Alderson, LL.B, LL.M (Commercial and Corporate), Q.Arb, Lawyer and ArbitratorArbitration, Commercial, Commercial Arbitration, Commercial List Matters, Cross-Border Litigation, Debt and Enforcing Judgments, Enforcement of Foreign Arbitral Awards, International Sale of Goods0 Comments

Legislation based on the UNCITRAL Model Law on International Commercial Arbitration (1985), with amendments as adopted in 2006 (the “Model Law”) has been adopted in 78 States of a total of 109 jurisdictions, including Canada, Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island, Quebec, Saskatchewan and Yukon. The legislation in Ontario, Canada, amends previous legislation based on the Model Law and is based on the text, with amendments as adopted in 2006, of the UNCITRAL Model Law on International Commercial Arbitration. Recent jurisdictions to enact Model Law legislation include: In 2017: Australian Capital Territory, Fiji, Jamaica, Mongolia, Qatar, and South Africa. In 2016: Myanmar, Republic of Korea, and Uganda. The continued expansion of an already substantial number of jurisdictions enacting Model Law legislation means even greater harmonization of national laws through all stages of the commercial arbitration process, from the arbitration agreement itself, to the recognition and … Read More