Ali v. O-Two Medical Technologies Inc., (2013) 313 O.A.C. 189 (CA)

• Judge: Gillese, Juriansz and Strathy, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: September 26, 2013
• Jurisdiction: Ontario
• Citations: (2013), 313 O.A.C. 189 (CA);2013 ONCA 733

Ali v. O-Two Medical Tech. Inc. (2013), 313 O.A.C. 189 (CA)

MLB headnote and full text

Temp. Cite: [2013] O.A.C. TBEd. DE.006

Samir Ali (plaintiff/appellant) v. O-Two Medical Technologies Inc. (defendant/respondent)

(C56718; 2013 ONCA 733)

Indexed As: Ali v. O-Two Medical Technologies Inc.

Ontario Court of Appeal

Gillese, Juriansz and Strathy, JJ.A.

December 5, 2013.

Summary:

Ali had an agreement with O-Two Medical Technologies Inc. to sell its products in Iraq on a commission basis. On December 5, 2006, Ali negotiated a large sale to the Iraqi Ministry of Health. On December 12, 2006, O-Two purported to unilaterally change the commission agreement and informed Ali that it would be paying him a lower rate of commission. O-Two and the Iraqi Ministry of Health went on to complete their transaction. Ali became entitled to receive his commission in November 2007. On November 23, 2007, O-Two tendered payment of Ali's commission at the lower rate. On September 16, 2009, Ali issued a statement of claim against O-Two based on breach of contract and quantum meruit. O-Two moved for summary judgment on the basis that Ali's claims arose outside the two year limitation period under s. 4 of the Limitations Act.

The Ontario Superior Court, in a decision reported at [2013] O.T.C. Uned. 880, allowed the motion for summary judgment and dismissed Ali's claim. Ali appealed.

The Ontario Court of Appeal allowed the appeal, set aside the motion judge's order and dismissed the motion for summary judgment.

Contracts - Topic 3544

Performance or breach - Anticipatory breach - What constitutes - [See Limitation of Actions - Topic 2023 ].

Contracts - Topic 3664

Performance or breach - Repudiation - What constitutes repudiation - [See Limitation of Actions - Topic 2023 ].

Limitation of Actions - Topic 15

General principles - Discoverability rule - Application of - [See Limitation of Actions - Topic 2023 ].

Limitation of Actions - Topic 2023

Actions in contract - Actions for breach of contract - When time commences to run - Ali had an agreement with O-Two Medical Technologies Inc. to sell its products in Iraq on a commission basis - On December 5, 2006, Ali negotiated a large sale to the Iraqi Ministry of Health - On December 12, 2006, O-Two purported to unilaterally change the commission agreement and informed Ali that it would be paying him a lower rate of commission - In August 2007, Ali demanded that commission be paid at the higher rate - O-Two replied by letter in September 2007, reiterating its previous position - O-Two and the Iraqi Ministry of Health went on to complete their transaction - Ali became entitled to receive his commission in November 2007 - On November 23, 2007, O-Two tendered payment of Ali's commission at the lower rate - On September 16, 2009, Ali issued a statement of claim against O-Two based on breach of contract and quantum meruit - O-Two moved for summary judgment on the basis that Ali's claims arose outside the two year limitation period under s. 4 of the Limitations Act - O-Two argued that Ali's claim arose when it changed the commission structure in December 2006 - The motion judge allowed the summary judgment motion and dismissed Ali's claim - The Ontario Court of Appeal allowed Ali's appeal - The doctrine of anticipatory breach was relevant to the timing of the breach - O-Two's change in Ali's commission structure in December 2006 was a repudiation of its contractual obligations before it became obligated to pay the commission in November 2007 - Rather than accept the repudiation, Ali chose to treat the contract as subsisting and continued to press for payment in full - He therefore did not know that he would suffer "damage" until the payment of his commissions fell due in November 2007 and O-Two did not make full payment - Ali's claim was filed in time.

Cases Noticed:

Caglar v. Moore et al., [2005] O.T.C. 935 (Sup. Ct.), refd to. [para. 9].

Hamilton (City) v. Metcalfe & Mansfield Capital Corp. et al. (2012), 290 O.A.C. 42; 2012 ONCA 156, refd to. [para. 9].

Brown v. Belleville (City) (2013), 302 O.A.C. 354; 114 O.R.(3d) 561; 2013 ONCA 148, refd to. [para. 14].

Wadsworth v. RBC Dominion Securities Inc. et al., [2007] O.A.C. Uned. 194; 2007 ONCA 340, refd to. [para. 16].

Guarantee Co. of North America v. Gordon Capital Corp., [1999] 3 S.C.R. 423; 247 N.R. 97; 126 O.A.C. 1, refd to. [para. 25].

MacNaughton v. Stone, [1949] O.R. 853, refd to. [para. 25].

Authors and Works Noticed:

Fridman, Gerald Henry Louis, The Law of Contract in Canada (6th Ed. 2011), p. 585 [para. 22].

Waddams, S.M., The Law of Contracts (6th Ed. 2010), para. 621 [para. 24].

Counsel:

Tim Gleason and Megan Reid, for the appellant;

David A.S. Mills and Jennifer A.N. Corak, for the respondent.

This appeal was heard on September 26, 2013, before Gillese, Juriansz and Strathy, JJ.A., of the Ontario Court of Appeal. Juriansz, J.A., delivered the following judgment for the court on December 5, 2013.