Cape Breton Development Corp. v. Roper (D.) Services Ltd., 2005 NSCA 7

• Judge: Cromwell, Oland and Hamilton, JJ.A.
• Court: Court of Appeal of Nova Scotia (Canada)
• Case Date: January 20, 2005
• Jurisdiction: Nova Scotia
• Citations: 2005 NSCA 7;(2005), 229 N.S.R.(2d) 307 (CA)

Cape Breton Dev. v. Roper Services (2005), 229 N.S.R.(2d) 307 (CA);

 725 A.P.R. 307

MLB headnote and full text

Temp. Cite: [2005] N.S.R.(2d) TBEd. JA.035

D. Roper Services Limited (appellant/respondent by cross-appeal) v. Cape Breton Development Corporation (respondent/appellant by cross-appeal)

(183925; 2005 NSCA 7)

Indexed As: Cape Breton Development Corp. v. Roper (D.) Services Ltd.

Nova Scotia Court of Appeal

Cromwell, Oland and Hamilton, JJ.A.

January 20, 2005.

Summary:

Devco issued an invitation for tenders for the banking, blending and lifting of coal products at a coal preparation plant. Roper Ltd. was awarded the contract. Roper's equipment began to suffer breakdowns. Devco terminated the contract, claiming that Roper was unable to perform its obligations under the contract. Devco sued Roper, claiming reimbursement of monies advanced to Roper and for expenses incurred for equipment rentals and other activities necessitated by Roper's failure to perform under the contract. Roper counterclaimed for damages arising out of losses allegedly caused by Devco's wrongful termination of the contract and for extras performed under the contract for which it was never paid. Roper also alleged negligent misrepresentation and breach of contract, arguing that the coal tonnages provided by Devco were substantially less than those set out in the invitation for tender and incorporated into the purchase order.

The Nova Scotia Supreme Court, in a decision reported 202 N.S.R.(2d) 201; 632 A.P.R. 201, held that Roper fundamentally breached the contract by failing to perform due to equipment breakdown. Devco fundamentally breached the contract by failing to provide coal approximating the tonnages it had represented. The court denied Roper's claim for negligent misrepresentation. Roper was not entitled to any claim for loss of profits for the unexpired term of the contract because it would have been operating at a loss even if the estimated tonnages had been provided. Even if there had been a loss, it would have been limited to 30 days because Devco was entitled to terminate the contract on 30 days notice. Devco was entitled to be reimbursed for certain equipment rentals and extra costs it incurred and overpayments made to Roper ($270,307). The court awarded Roper $10,000 for extras that it had performed. Roper appealed, arguing that the judge erred in finding that it was in breach of contract, in failing to find Devco liable in negligent misstatement and in assessing damages as he did. Devco cross-appealed, submitting that the judge erred in finding that Devco was in breach of the contract and in holding that it was not entitled to rely on the exclusion from liability provisions in it.

The Nova Scotia Court of Appeal dismissed the appeal. The court noted that Roper's appeal was directed primarily at the trial judge's findings of fact. However, the court held that the judge did not make any reviewable error with respect to the facts. As for the cross-appeal, Devco acknowledged that if the appeal failed, the cross-appeal would have no effect on the trial judge's order. It was, therefore, not necessary for the court to address the issues raised by cross- appeal and it, too, was dismissed.

Contracts - Topic 3730

Performance or breach - Fundamental breach - What constitutes a fundamental breach - Devco issued an invitation for tenders for the banking, blending and lifting of coal products at a coal preparation plant - Roper Ltd. was awarded the contract - Roper's equipment began to suffer breakdowns - Devco terminated the contract, claiming that Roper was unable to perform its obligations under the contract - Devco sued Roper for damages resulting from Roper's failure to perform under the contract - Roper counterclaimed for damages for Devco's wrongful termination of the contract and for extras - Roper also alleged negligent misrepresentation and breach of contract, arguing that the coal tonnages provided by Devco were substantially less than those set out in the invitation for tender and incorporated into the purchase order - The trial judge held that Roper fundamentally breached the contract by failing to perform due to equipment breakdown - Devco fundamentally breached the contract by failing to provide coal approximating the tonnages it had represented - The court denied Roper's claim for negligent misrepresentation - Roper appealed and Devco cross-appealed - The Nova Scotia Court of Appeal dismissed the appeals.

Fraud and Misrepresentation - Topic 2508

Misrepresentation - General principles - Negligent misrepresentation - [See Contracts - Topic 3730 ].

Practice - Topic 8800

Appeals - General principles - Duty of appellate court regarding findings of fact - The Nova Scotia Court of Appeal stated that findings of fact will not be reversed on appeal unless the trial judge made a palpable and overriding error - The same degree of deference should be paid to inferences drawn from the facts and to all of the trial judge's findings whether based on findings of credibility or not - See paragraph 44.

Practice - Topic 8800.1

Appeals - General principles - Duty of appellate court regarding findings of mixed law and fact by trial judge - The Nova Scotia Court of Appeal stated that mixed questions of fact and law, such as the application of a legal standard to a set of facts, should be reviewed according to the palpable and overriding error standard unless the alleged error can be traced to an error of law which may be extricated from the mixed question of law and fact - Where that is possible, the alleged legal error should be reviewed on the standard of correctness - See paragraph 45.

Practice - Topic 8800.2

Appeals - General principles - Duty of appellate court regarding findings of law - The Nova Scotia Court of Appeal stated that errors of law, such as the misstatement of a legal principle or a wrong characterization of a legal standard, attract the correctness standard of review - See paragraph 46.

Cases Noticed:

Guarantee Co. of North America v. Gordon Capital Corp., [1999] 3 S.C.R. 423; 247 N.R. 97; 126 O.A.C. 1, consd. [para. 30].

Housen v. Nikolaisen et al., [2002] 2 S.C.R. 235; 286 N.R. 1; 219 Sask.R. 1; 272 W.A.C. 1, refd to. [para. 44].

Queen (D.J.) v. Cognos Inc., [1993] 1 S.C.R. 87; 147 N.R. 169; 60 O.A.C. 1, refd to. [para. 62].

Hedley Byrne & Co. v. Heller & Partners Ltd., [1964] A.C. 465, refd to. [para. 65].

Authors and Works Noticed:

Fridman, Gerald Henry Louis, The Law of Torts in Canada (2nd Ed. 2002), p. 403 [para. 65].

Counsel:

Vincent Gillis, for the appellant/respondent by cross-appeal;

Aidan Meade and John W. MacDonald, for the respondent/appellant by cross-appeal.

This appeal was heard before Cromwell, Oland and Hamilton, JJ.A., of the Nova Scotia Court of Appeal. The following decision was delivered for the court by Cromwell, J.A., on January 20, 2005.