Cases Condisidered: Marathon Canada Ltd v. Enron Canada Ltd, 2008 ABQB 408;
Marathon Canada Ltd v. Enron Canada Ltd, 2009 ABCA 31.

PDF Version: Terminating a long term gas sales contract on account of a material adverse change: the continuing fallout from the collapse of the Enron Empire

The Court of Appeal, in a memorandum of judgement authored by Justices Ellen Picard, Peter Costigan and Jack Watson, has affirmed the decision at trial of Justice Terence McMahon of the Alberta Court of Queen’s Bench. Justice McMahon held that Marathon Canada had lawfully terminated a natural gas purchase contract with Enron Canada. Marathon chose to terminate when Enron Canada’s US parent (Enron Corp) fell into serious financial difficulties. Both courts also held that: (1) Marathon was entitled to recover $560,000 damages for natural gas that it had delivered prior to contract termination, but that, (2) Enron Canada was not entitled to recover liquidated damages of some $126 million based on a counter-claim of wrongful termination and the estimated\guesstimated present value of Marathon’s future deliveries at the contract price.

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Cases Considered: Brewer v. Fraser Milner Casgrain LLP, 2008 ABCA 435;
Baum v. Calgary (City), 2008 ABQB 791

PDF Version:  Disability Discrimination in the Workplace

Two recent Alberta decisions (one from the Court of Queen’s Bench and one from the Court of Appeal) illustrate the significance of the process followed by decision-makers when analyzing whether, under the Human Rights, Citizenship and Multiculturalism Act, R.S.A. 2000, c. H-14 (”HRCMA“), a person has been discriminated against, and, if so, whether the employer has accommodated the person to the point of undue hardship. As noted by Madam Justice Eidsvik in Baum v. Calgary (City), 2008 ABQB 791 (”Baum“): “Accordingly, the law on the duty to accommodate has become quite well developed however, the initial test [see #1 below] has been sparsely discussed until recently” (at para. 29). These two cases illustrate this observation.

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Cases Considered: Orbus Pharma Inc. v. Kung Man Lee Properties Inc., 2008 ABQB 754.

PDF Version:  A Welcome Primer on Interpreting Covenants in Leases

This case is about the proper interpretation of a term in a commercial lease concerning the ability of the tenant to assign or sublet the premises. The provision appeared to say that when the tenant asked for the landlord’s consent to an assignment or sublease, the landlord could either consent or refuse consent or - and this was the controversial point - cancel the lease altogether. Although this clearly reasoned and well-written decision turns on the exact wording of the relevant provision in the lease, there is nevertheless a great deal of precedential value in this decision because of the principles of law used by Justice Scott Brooker in his approach to the interpretative task. Characterizing the provision as “astute bargaining” on the part of the landlord that allowed it to terminate a lease with a rent substantially below market rates (at para. 68), this judgment is also a marked contrast with the decision in 550 Capital Corp. v. David S. Cheetham Architect Ltd., 2008 ABQB 370. In that earlier case, the tenant’s contorted efforts to evade the consequences of a similar clause in its lease were rewarded: see the critique of this decision written by Nick Rafferty and myself in “What’s Wrong with Landlord’s Rights?”

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Cases Considered: Tsuu T’ina Nation v. Frasier, 2009 ABCA 23.

PDF Version: “Litigation by installments”: Further Developments in the Black Bear Crossing Dispute

As noted in a previous post, a February 2008 decision of the Alberta Court of Appeal effectively prevented the Tsuu T’ina Nation from enforcing an eviction notice against residents of Black Bear Crossing whose band membership was disputed until such time as the membership of the residents was resolved (see 2008 ABCA 74). The Tsuu T’ina’s application for leave to appeal to the Supreme Court of Canada was denied on October 30, 2008 (see 2008 CanLII 55966). Meanwhile, the parties were before the Alberta courts again when the Tsuu T’ina Nation cut off the water and utilities for the three remaining residents of Black Bear Crossing (BBC). The Tsuu T’ina Nation was held in civil contempt by Justice Jo’Anne Strekaf of the Court of Queen’s Bench for refusing to supply the residents with these services after being ordered to do so. Those orders had been made as conditions of an adjournment granted to the Tsuu T’ina in respect of its underlying action pursuing eviction of all remaining residents of BBC on October 20, 2008. The Court of Appeal had left such an action open to the Tsuu T’ina if it did not discriminate between member and non-member residents. On January 15, 2009, Justice Patricia Rowbotham of the Alberta Court of Appeal granted the Tsuu T’ina leave to appeal Justice Strekaf’s October 20, 2008 order (2009 ABCA 23). In a strange twist, however, the previous day Justice Strekaf granted the Tsuu T’ina an eviction order in respect of the one remaining resident of BBC, the other two having moved out after accepting the Nation’s offer of a year’s accommodation off-reserve (see here).

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Cases Considered: R. v. Krieger, 2008 ABCA 394

PDF Version:  Medical Marihuana Suppliers and the Charter

There have been several cases before the courts raising issues concerning the right to access medical marihuana as a defence to criminal charges under the Controlled Drugs and Substances Act, S.C. 1996, c. 19. Grant Krieger, a well known Calgary-based supporter of the legalization of marihuana and its use for medical purposes, and someone who suffers from multiple sclerosis himself, has brought several such claims. His attempts to raise the defence of necessity in criminal law have not been particularly successful (see R. v. Krieger, 2003 ABCA 85; R. v. Krieger, 2005 ABCA 202). Arguments based on Krieger’s right to use and produce marihuana as an aspect of his security of the person under s.7 of the Canadian Charter of Rights and Freedoms have met with more success (see R. v. Krieger (2000), 225 D.L.R. (4th) 164, 2000 ABQB 1012, aff’d 2003 ABCA 85, leave to appeal refused, [2003] S.C.C.A. No. 114). More recently, Krieger tried to push the limits of the jurisprudence by claiming a Charter defence to charges of trafficking marihuana for medical purposes in circumstances where he was supplying others with the drug.

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Cases Considered: Bearspaw Petroleum Ltd. v. Alberta Energy and Utilities Board, 2008 ABCA 405;
Bearspaw Petroleum Ltd. v. Alberta Energy and Utilities Board, 2009 ABCA 3.

PDF Version: Obtaining leave to appeal an ERCB decision: Where is the justice?

Section 41 of the Energy Resources Conservation Act, R.S.A. 2000 c. E-10 provides for an appeal from a decision of the Energy Resources Conservation Board (ERCB) on questions of law or jurisdiction with leave of the Court of Appeal. The test for leave includes a consideration of four factors: (1) whether the point on appeal is of significance to the practice; (2) whether the point raised is of significance to the action itself; (3) whether the appeal is prima facie meritorious; and (4) whether the appeal will unduly hinder the progress of the action. Bearspaw Petroleum Ltd. v. Alberta Energy and Utilities Board is one of many recent leave to appeal decisions from the Court (See for example “Landowners, Procedural Fairness and Alberta’s Energy Resources Conservation Board” ). What strikes me about this decision is how it compares to the Court’s decision to deny leave to appeal in Sawyer v. Alberta Energy and Utilities Board, 2007 ABCA 297 (see “Standing against public participation at the Alberta Energy and Utilities Board”).

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PDF Version:  The Counterview to a National Securities Regulator in Canada

I am coming to the aid of an old friend. Having worked as legal counsel at the Alberta Securities Commission, I can tell you the current securities regulatory system works and is far less fragmented than most suggest. Indeed provincial (and territorial) securities regulation serves Canadians very well notwithstanding the challenges of operating within such a large and diverse a nation as Canada. Of all the legitimate reasons to implement a national securities regulator, let’s be clear that “fixing the system” is not one of them.In the early part of the 20th century, various provinces enacted securities legislation to regulate the sale of securities in their jurisdiction. In 1932, the U.K. Privy Council upheld Alberta’s securities legislation as within the provincial constitutional purview with its Lymburn v. Mayland decision, [1932] A.C. 318. Until the 1960s, most provincial governments administered their securities legislation within the executive branch. Presumably growth in the size and complexity of the capital market within certain provinces led governments to create provincial administrative agencies known as securities commissions and delegate regulatory authority to them. Shortly thereafter a federal proposal for securities regulation was published in 1979. Similar national proposals have surfaced more recently with the Crawford Report in 2005 and now the Hockin Report. The point of this history lesson is simply to observe that provincial jurisdiction over securities regulation has been challenged time and time again almost from the day it started.

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Cases Considered: Smorag v. Nadeau, 2008 ABQB 714

PDF Version: The Spectre of Personal Liability for Guardians of Dependant Adults

The decision in Smorag v. Nadeau is noteworthy because the Workers’ Compensation Board (WCB) argued that the defendant was personally liable for a health care decision she made in her role as the guardian of an adult who lacked the mental capacity to make that decision for herself. Madam Justice June Ross appears to have accepted this novel argument. She found that the Dependant Adults Act, R.S.A. 2000, c. D-11, under which the defendant had been appointed guardian and granted the power to make health care decisions for the dependant adult, did not protect the defendant from personal liability. Although Justice Ross did, in the end, strike down the lawsuit against the defendant personally, she did so only because she was not prepared to find a duty of care owed by the defendant to an employee of the extended care facility where the dependant adult resided. That part of the decision - an Anns analysis - raises some interesting issues in itself. However, I want to focus on the fact that the law suit against the defendant in her personal capacity got as far as the Anns analysis. I will also look at whether Bill 24, the new Adult Guardianship and Trusteeship Act, S.A. 2008 c. A-4.2 that will replace the Dependant Adults Act later this year, removes the spectre of personal liability for guardians.

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Cases Considered:  John Custer v. Syncrude Canada

PDF Version: Environmental Private Prosecution Update: John Custer v. Syncrude Canada

On January 7, John Custer swore an information in front of a Justice of the Peace in Edmonton alleging violation by Syncrude Canada of section 5.1 of the Migratory Birds Convention Act, S.C. 1994, c. 22 for depositing substances harmful to migratory birds in its Aurora Mines tailing pond. The prohibition in section 5.1 reads as follows:

5.1 (1) No person or vessel shall deposit a substance that is harmful to migratory birds, or permit such a substance to be deposited, in waters or an area frequented by migratory birds or in a place from which the substance may enter such waters or such an area.

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Cases Considered: Devon Canada Corporation v. PE-Pittsfield, LLC, 2008 ABCA 393.

PDF Version: Limited Partnerships: Devon Canada Corporation v. PE-Pittsfield, LLC

In Devon Canada Corporation v. PE-Pittsfield, LLC, the Alberta Court of Appeal clarified the law respecting foreign limited partnerships and discovery of limited partners in two respects. First, it determined that limited partners cannot be examined when the limited partnership is named as a defendant in an action. Second, it determined that a foreign, unregistered limited partnership has the same rights and obligations of a limited partnership under Alberta law.

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