B.B.J. Enterprises Ltd. et al. v. Wendy's Restaurants of Canada Inc. et al.

• Jurisdiction: Nova Scotia
• Court: Supreme Court of Nova Scotia (Canada)
• Judge: Edwards, J.
• Citation: 2004 NSSC 37,(2004), 222 N.S.R.(2d) 52 (SC)
• Date: 16 February 2004

BBJ Ent. Ltd. v. Wendy's Restaurants (2004), 222 N.S.R.(2d) 52 (SC);

 701 A.P.R. 52

MLB headnote and full text

Temp. Cite: [2004] N.S.R.(2d) TBEd. MR.030

B.B.J. Enterprises Limited, B. Yazer Holdings Limited, Brendon Yazer and Beverly Niven Yazer (plaintiffs/respondents) v. Wendy's Restaurants of Canada Inc. and Wendy's International Inc. (defendants/applicants)

(102025; 2004 NSSC 37)

Indexed As: B.B.J. Enterprises Ltd. et al. v. Wendy's Restaurants of Canada Inc. et al.

Nova Scotia Supreme Court

Edwards, J.

February 18, 2004.

Summary:

Wendy's contracted to purchase the assets of one of its franchises that was in financial trouble. One-half hour before the sale was to close, the vendor was asked by Wendy's to sign a release barring any future action respecting the sale. The vendor's financial situation left no other option but to execute the release, as it was imperative that the sale be completed. Six years later, the vendor sued Wendy's for damages respecting the sale. Wendy's pleaded the release and applied for a determination as to its validity.

The Nova Scotia Supreme Court held that the release was unconscionable and invalid. Wendy's presented the release, which had not been part of the sale negotiations, with knowledge that the vendor had no choice but to sign it. Accordingly, the vendor was not barred from suing.

Releases - Topic 3403

Grounds of invalidity - Unconscionability - Wendy's contracted to purchase the assets of one of its franchises that was in financial trouble - One-half hour before the sale was to close, the vendor was asked by Wendy's to sign a release barring any future action respecting the sale - The vendor's financial situation left no other option but to execute the release, as it was imperative that the sale be completed - Six years later, the vendor sued Wendy's for damages respecting the sale - Wendy's pleaded the release and applied for a determination as to its validity - The Nova Scotia Supreme Court held that the release was unconscionable and invalid - Wendy's presented the release, which had not been part of the sale negotiations, with knowledge that the vendor had no choice but to sign it - Accordingly, the vendor was not barred from suing.

Cases Noticed:

Stephenson v. Hilti (Canada) Ltd. (1989), 93 N.S.R.(2d) 366; 242 A.P.R. 366 (T.D.), appld. [para. 13].

Counsel:

M. Joseph Rizzetto, for the plaintiffs/ respondents;

John T. Shanks, for the defendants/applicants.

This application was heard on February 16, 2004, at Sydney, N.S., before Edwards, J., of the Nova Scotia Supreme Court, who delivered the following judgment on February 18, 2004.