With apologies to Mark Twain for the mangling of his famous quote, fans of specific performance may be cheered by the very recent decision of the Court of Appeal in Maraschiello v. Shellrock Developments Ltd.

For the uninitiated, specific performance is an Order granted by a Court requiring the party in breach of obligations under a contract to perform those obligations.

In this case, the plaintiffs sold their farm, where they had lived and worked since 1978, to Shellrock.  The terms of the agreement included an obligation on Shellrock to use best efforts within 12 months after the May 2004 closing date to obtain a severance of a 1 acre parcel of the property on which the plaintiffs’ house was located.  The intention was that the plaintiffs would continue to own and live in their house.

Shellrock failed to obtain the severance and the plaintiffs sued for specific performance, alleging that Shellrock had failed to use best efforts to obtain the severance.  The plaintiffs maintained that had Shellrock made best efforts, or in fact any reasonable effort, it is very likely that severance would have been obtained.  Continue reading →

The area around Georgian Bay between Wasaga Beach and Meaford contains many interesting features.  The beaches along Georgian Bay, the private ski clubs in the area, the pedestrian village of Blue Mountain, a lengthy cycling trail, and beautiful golf courses are only some of the many wonderful recreational features of the area.  As idyllic as it may sound, however, weird things happen in that neighbourhood as evidenced by the recent Court of Appeal decision in a case between the Town of Meaford and a group of home and cottage owners along Georgian Bay and the Meaford area.

In this case, to quote the Court, the Town of Meaford quite literally “found a by-law in a box in its basement”.  I am not kidding.  The by-law was passed in August 1854 by the municipal council in place at the time.  It was entitled By-law No. 11 for 1854 and established a lakeshore road along 4 adjoining lots.  The road surface would have covered about 6,000 feet abutting Georgian Bay.

The by-law was never registered on title.  Rather, it was lost to history for about 150 years.  In fact, the road surface was largely lost to Georgian Bay when the area was washed out in a storm in 1986.  Continue reading →

Many years ago, I acted for a client who was in the business of running junkets to gambling destinations in the Caribbean. He was quite a gambler himself and managed to rack up a significant debt at a Puerto Rico casino which he neglected to pay. The casino sued him in Ontario, and he retained me to defend him.

I did come up with a number of arguments for setoffs based on his business relationship with the casino concerning the planeloads of gamblers he was bringing in, but I was intrigued by the fact that there did not seem to be very much of a defence to the casino’s claim against him for his gambling debt.

From time to time, someone comes up with an interesting defence to an action to collect gambling debts. The latest effort was put forward in a case recently decided by the Court of Appeal called Moreira et al. v. Ontario Lottery and Gaming Commission et al.

In this case, the Plaintiffs were high stakes gamblers who had lost over $2 million playing roulette at the Niagara Fallsview Casino Resort over a span of about 3 ½ years. During that time, they signed markers to the casino. When the casino demanded payment on the markers, the Plaintiffs sued first and demanded the return of all of the money that they had lost.  Continue reading →

I recently submitted a paper entitled “The Role of Anger in Mediation” for the Masters course I’m taking at Osgoode Hall Law School in ADR. The paper was well received, and I am in the process of trying to have it published. It is fairly lengthy, but it may be of interest to anyone who participates in mediations, either as a party, as counsel or as mediator. I attach a copy on the link below.

The Role of Anger in Mediation

In an action against a company whose financial status is questionable, it is common to consider whether or not it might be possible to sue an individual representative of the company, such as its owner or president, in the hope that if a judgment is not enforceable against the company, it might be enforceable against the individual.  Sometimes, such an action is brought as a tactical step, intended to intimidate or unsettle the company’s decision-maker into a quick settlement.

The law is very clear on the point.  As a general rule, an individual representative of a corporate entity will not be liable for wrongful conduct unless it can be established that the individual committed what the cases refer to as an “independent tort”.  In other words, the alleged wrongful conduct on the part of the individual has to be independent from the tort or breach of contract allegedly committed by the company.  Otherwise, and if the individual was simply making decisions on behalf of the company, there is no personal liability.

An interesting twist on the point arose on the facts of a recent Court of Appeal decision, Richards v. Media Experts M.H.S. Inc. and Mark Sherman.

In that case, Ms. Richards sued her former employer, Media Experts, for damages for wrongful dismissal.  She also sued Mr. Sherman, the executive chairman of Media Experts, for damages for the torts of intentional and negligent infliction of nervous shock.  The alleged shock arose out of the act of termination.

The courts have become very sensitive to any attempt to fix liability on an individual where the claim against his company is problematic.

Mr. Sherman brought a motion to have the claim dismissed as against him, and succeeded.  The motion judge noted that the Plaintiff’s employment contract contained a clause limiting the company’s liability for wrongful dismissal to compensation equal to 12 months’ pay.  The judge went on to conclude that to permit a claim to proceed against Mr. Sherman would allow the Plaintiff to circumvent that clause, by obtaining compensation over and above the contract amount.

Continue reading →

The recent decision of the Ontario Court of Appeal in Di Battista v. Di Battista Farms Ltd. et al. is a useful reminder of the requirements for certainty before a contract will be found to be binding and effective.

In this case, Tony Di Battista worked with his three brothers in construction.  Together with their nephew, they started Di Battista Farms Ltd. which owned property in Kleinburg, Ontario.

A dispute arose, and Tony was bought out by the other shareholders.  As part of the buyout, they signed a memorandum of agreement indicating that they would all cooperate with either or both of Tony or their nephew if either decided to try to obtain a building permit to build a house on a part of the property.

The word “cooperation” is open-ended and lacks specificity.

About 15 years later, Tony decided to try to obtain a building permit and asked his brothers to consent to his application for a severance of a section of the property.  They refused.  Tony then sued to enforce the memorandum of agreement.

The judge hearing the matter dismissed Tony’s application, finding that there was not sufficient certainty in the contract.  Tony appealed to the Court of Appeal.  The Court of Appeal agreed with the judge and dismissed the appeal.  Continue reading →

The recent Superior Court of Ontario decision in Robert Moore Pharmacy Ltd. et al. v. Shoppers Drug Mart Inc. is an interesting reminder of the legal status of the duty of good faith as it applies to franchises.

In Ontario, franchises are regulated by a specific statute, the Arthur Wishart Act. This statute appears to have been enacted in response to a number of cases in which franchisors appeared to be taken advantage of franchisees in some significant way. I say that because its provisions are extremely favourable to franchisees.

The obligations that it places on a franchisor are onerous. A franchisor’s failure to comply with even the most technical of requirements under the Act may well have disastrous results for it.

Among the more significant policy principles behind the Act is the obligation on franchisors to act in good faith.

In this case, the Plaintiff was a Shoppers Drug Mart franchisee. Its franchise agreement provided for an original one-year term and the potential for two one-year renewal terms. The renewal terms were to come into existence automatically if neither party took the steps to terminate the agreement during its existence by giving notice.  Continue reading →