Cowper-Smith and the Law of Proprietary Estoppel: Implications for the Oil and Gas Lease?

By: Nigel Bankes

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Case Commented On: Cowper-Smith v Morgan, 2017 SCC 61 (CanLII)

The Supreme Court of Canada handed down its decision in Cowper-Smith v Morgan in December 2017. The decision is an important decision on proprietary estoppel. While it arises in the context of a family dispute it deserves to be read by commercial lawyers including oil and gas lawyers. It is one of the curiosities of the Canadian law of estoppel that some of our leading cases have come out of fact patterns involving the “unless” form of the oil and gas lease from the 1960s and 1970s from Alberta and Saskatchewan. These cases include Canadian Superior Oil Ltd. v Paddon-Hughes Development Co., [1970] S.C.R. 932, 1970 CanLII 3 (SCC) and Sohio Petroleum Co. v Weyburn Security Co., [1971] S.C.R. 81, 1970 CanLII 137 (SCC). These cases continue to be influential in oil and gas lease matters and beyond. The typical fact pattern involves a missed or late payment during the primary term or a missed or late shut-in payment during the secondary term which automatically terminates the lease unbeknownst to either party. The parties continue to act as if the lease is in force and in some cases the lessee expends considerable monies on the leased lands including drilling a new well. But in the end, all is for naught. The lease is dead and to this point estoppel arguments aimed at reviving the lease have largely failed; in some cases on the basis that estoppel cannot be used as a sword (to create a new lease), and in other cases, and most commonly, on the basis that the lessee never acted to its detriment on the basis of a representation made by the lessor that the lease was still in effect; typically there was no such representation, the lessee was simply proceeding on the basis of its own understanding of the legal position. Continue reading →

Is a Bad Lawyer a Bad Person?

By: Alice Woolley

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In 1976 Charles Fried famously asked, “Can a good lawyer be a good person?” (“The Lawyer as Friend: The Moral Foundations of the Lawyer-Client Relation” (1976) 85 Yale LJ 1060 at 1060).

Law and morality are distinct. As a consequence, lawyers sometimes represent bad people, and sometimes help people do bad things. There is thus a legitimate question about whether being a lawyer is consistent with an ethical life. Nonetheless, Fried answered his question “yes”. Because of the law’s legitimacy and justification, a lawyer who assists people to pursue their goals and interests through the law can be – is – a good person. She does a job worth doing. Continue reading →

The AESO Line Loss Marathon Inches Towards the Finish Line

By: Nigel Bankes

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Decision Commented On: Milner Power Inc. & ATCO Power Ltd. Complaints Regarding the ISO Transmission Loss Factor Rule and Loss Factor Methodology, Phase 2 Module C, AUC Decision 790-D06-2017, December 18, 2017

In a pre-Christmas post on the power purchase arrangements (PPAs) saga I hinted that, at least from the perspective of the energy regulatory lawyers in the city, the PPA saga must be the gift that keeps on giving; but this epithet must be even more so for the line loss dispute—for this truly is a marathon. And while the latest decision of the Alberta Utilities Commission (AUC) gets us a little closer to the finish line, I fully expect that we shall see further applications to the AUC for review and variance and perhaps several more trips to the Court of Appeal. Indeed I believe that there is still one outstanding application (Capital Power Corporation v Alberta (Utilities Commission), 2015 ABCA 197 (CanLII) and see also at paras 150-152 of this decision) for permission to appeal an earlier decision which application was adjourned sine die pending the outcome of the AUC’s decision on the merits (i.e. this decision). Continue reading →

R v EJB: Another Unconstitutional Mandatory Minimum Sentence

By: Daphne Wang

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Case Commented On: R v EJB, 2017 ABQB 726 (CanLII)

In a previous post, Professor Erin Sheley commented that R v Nur, 2015 SCC 15 (CanLII), may have started a “widespread dismantling of the Criminal Code’s policy of gun-related mandatory minimums.” Since Nur, constitutional challenges to mandatory minimums have reached beyond gun-related crimes. The Supreme Court of Canada in R v Lloyd, 2016 SCC 13 (CanLII), held the one-year mandatory minimum for drug trafficking under s 5(3)(a)(i)(D) of the Controlled Drugs and Substances Act, SC 1996 c 19, to be unconstitutional (at para 56). By doing so, the SCC left other offences with mandatory minimums vulnerable to constitutional challenge under s 12 of the Charter. Following Lloyd, the recent Court of Queen’s Bench decision R v EJB found the one-year mandatory minimum for sexual exploitation under s 153(1.1)(a) of the Criminal Code, RSC 1985, c C-46, to be of no force or effect (at para 90). Continue reading →

Approaching the Standard of Review for Standard Form Contracts Remains Unclear

By: Nicholas Konstantinov

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Case Commented On: EnCana Oil & Gas Partnership v Ardco Services Ltd, 2017 ABCA 401 (CanLII)

This case involves a dispute between EnCana and its payroll supplier, Ardco, over an indemnity provision in their Master Service and Supply Agreement (“Master Agreement”). In 2006, EnCana enlisted the services of Ardco to manage its contract operators. Ardco delivered these services only to EnCana; it paid and provided benefits and insurance to the contractors but was reimbursed by the larger corporation. The hiring and firing, supervision, and onsite management, including the supply of equipment, was EnCana’s responsibility. Continue reading →