32262 B.C. Ltd. v., (1998) 216 A.R. 33 (CA)

• Judge: Hetherington, O'Leary and Hunt, JJ.A.
• Court: Court of Appeal (Alberta)
• Case Date: March 26, 1998
• Citations: (1998), 216 A.R. 33 (CA)

32262 B.C. Ltd. v. See-Rite Optical (1998), 216 A.R. 33 (CA);

   175 W.A.C. 33

MLB headnote and full text

Temp. Cite: [1998] A.R. TBEd. AP.012

32262 B.C. Ltd.

(appellant/respondent by cross-appeal)

v. See-Rite Optical Ltd. and

Richard Crockett

(respondents/appellants by cross-appeal)

(9603-0074-AC)

Indexed As: 32262 B.C. Ltd. v.

See-Rite Optical Ltd. et al.

Alberta Court of Appeal

Hetherington, O'Leary and

Hunt, JJ.A.

March 26, 1998.

Summary:

See-Rite renewed a lease for a sign from the plaintiff for 77 months. See-Rite made payments until April 1991 when it requested the plaintiff to remove the sign. The plaintiff removed the sign and requested See-Rite to remit, pursuant to clause 24 of the lease, the remaining 70 monthly payments. See-Rite failed to make the further payments. The plaintiff sued See-Rite for, inter alia, pros­pective damages.

The Alberta Court of Queen's Bench, in a decision not reported in this series of reports, held, inter alia, that clause 24 was a penalty clause and therefore, unenforceable. The court calculated the damages. The plaintiff appealed. See-Rite cross-appealed.

The Alberta Court of Appeal, O'Leary, J.A., dissenting in part, allowed the appeal and dismissed the cross-appeal.

Contracts - Topic 4046

Remedies for breach - Liquidated damages and penalties - Whether deposit or amount specified is a penalty or liquidated dam­ages - See-Rite renewed a lease for a sign from the plaintiff - The lease, clause 24, provided that, upon breach of the lease by See-Rite, the remaining rental payments for the balance of the term were payable as liquidated damages - The Alberta Court of Appeal held that clause 24 was enforceable - It was a genuine pre-estimate of damages and was not a penalty clause - See para­graphs 5 to 18.

Personal Property - Topic 4202

Rental agreements - General - Display signs - [See Contracts - Topic 4046 ].

Personal Property - Topic 4324

Rental agreements - Breach by lessee - Action for balance - [See Contracts - Topic 4046 ].

Personal Property - Topic 4367

Rental agreements - Rent - Payment of - Where lessee repudiates lease - [See Con­tracts - Topic 4046 ].

Cases Noticed:

Dunlop Pneumatic Tyre Co. v. New Gar­age and Motor Co., [1915] A.C. 79, refd to. [para. 12].

Thermidaire Corp. v. H.F. Clarke Ltd. (1974), 3 N.R. 133; 54 D.L.R.(3d) 385 (S.C.C.), refd to. [para. 13].

J.G. Collins Insurance Agencies Ltd. v. Elsley et al., [1978] 2 S.C.R. 916; 20 N.R. 1; 83 D.L.R.(3d) 1, refd to. [para. 13].

Alwest Neon Signs Ltd. v. Henze (1989), 105 A.R. 343 (C.A.), refd to. [para. 14].

32262 B.C. Ltd. v. Thomas (N.R.) Pro­fessional Corp. et al. (1995), 170 A.R. 161 (Q.B.), refd to. [para. 14].

Keneric Tractor Sales Ltd. v. Langille, [1987] 2 S.C.R. 440; 79 N.R. 241; 82 N.S.R.(2d) 361; 207 A.P.R. 361; 43 D.L.R.(4th) 171, refd to. [para. 16].

Highway Properties Ltd. v. Kelly, Douglas & Co., [1971] S.C.R. 562; [1972] 2 W.W.R. 28; 17 D.L.R.(3d) 710, refd to. [para. 20].

Goldhar v. Universal Sections and Mould­ings Ltd., [1963] 1 O.R. 189; 36 D.L.R.(2d) 450 (C.A.), refd to. [para. 22].

Blue Chip Investments Inc. v. Hicks (1985), 54 Nfld. & P.E.I.R. 260; 160 A.P.R. 260; 18 D.L.R.(4th) 755 (Nfld. C.A.), refd to. [para. 23].

North Bay T.V. & Auto Ltd. v. Nova Electronics Ltd. et al. (1984), 12 D.L.R.(4th) 767n; 47 O.R.(2d) 588n (C.A.), affing. 4 D.L.R.(4th) 88; 44 O.R.(2d) 342; 30 R.P.R. 169 (H.C.), refd to. [para. 23].

Deerfoot Mall (Calgary) Ltd. v. Dalmont Enterprises (1987), 77 A.R. 204; 37 D.L.R.(4th) 429 (C.A.), refd to. [para. 23].

Sign-O-Lite Signs Ltd. v. Windsor Ply­wood (Kelowna) Ltd. (1988), 88 A.R. 301; 61 Alta. L.R.(2d) 21 (Q.B.), refd to. [para. 27].

32262 B.C. Ltd. (c.o.b. Wallace Neon) v. Goldstein, [1993] B.C.J. No. 2707 (B.C. Prov. Ct.), refd to. [para. 48].

Authors and Works Noticed:

Bridge, M.C., Damages for Breach of Hiring Agreements (1987), 3 B.F.L.R. 344, generally [para. 43].

Snell, Principles of Equity (27th Ed. 1973), p. 535 [para. 13].

Waddams, S., The Law of Damages (1996), pp. 8-7 to 8-9 [para. 15].

Counsel:

R.A. Beeken, for the appellant/respondent by cross-appeal;

E.W. Onusko, for the respondent/appellant by cross-appeal, See-Rite;

B.R. King, for the respondent, Crockett.

This appeal was heard before Hetherington, O'Leary and Hunt, JJ.A., of the Alberta Court of Appeal. The decision of the court was delivered on March 26, 1998, and the following opinion were filed:

Hunt, J.A., Hetherington, J.A., concurring - see paragraphs 1 to 38;

O'Leary, J.A., dissenting in part - see paragraphs 39 to 49.