DeWolfe v. Mansour and Tru-Kent Developments Ltd., (1986) 73 N.S.R.(2d) 110 (TD)

• Judge: Nunn, J.
• Court: Supreme Court of Nova Scotia (Canada)
• Case Date: April 10, 1986
• Jurisdiction: Nova Scotia
• Citations: (1986), 73 N.S.R.(2d) 110 (TD)

DeWolfe v. Mansour (1986), 73 N.S.R.(2d) 110 (TD);

    176 A.P.R. 110

MLB headnote and full text

Dewolfe v. Mansour and Tru-Kent Developments Ltd.

(1985 S.H. No. 54227)

Indexed As: DeWolfe v. Mansour and Tru-Kent Developments Ltd.

Nova Scotia Supreme Court

Trial Division

Nunn, J.

April 16, 1986.

Summary:

Mansour, a developer, and DeWolfe, a real estate agent, agreed to build and sell apartment buildings. To do this they set up a company, Tru-Kent Developments Ltd. They each invested in the company, Mansour having a 60% interest and DeWolfe a 40% interest. Both were shareholders and officers of the company. The building project began to have trouble and DeWolfe wanted out of the deal, offering Mansour a chance to buy his shares. The parties through their solicitors agreed, inter alia, that DeWolfe would sell his shares to Mansour and resign as an officer and director of the company in return for three promissory notes totalling $130,000.00 and releases from certain guarantees. DeWolfe performed his part of the bargain but Mansour did not deliver the promissory notes. DeWolfe commenced an action to enforce the agreement reached by the solicitors. Mansour argued that the contract was unenforceable on the grounds that it was an unconscionable bargain and, alternatively, that there was economic duress.

The Nova Scotia Supreme Court, Trial Division, rejected Mansour's defences and held that the agreement was enforceable.

Contracts - Topic 1586

Formation - Consent - Duress - Defence of - When available - Economic duress - The Nova Scotia Supreme Court, Trial Division, referred to a discussion of when a contract would be set aside for economic duress - The court examined a contract between two business partners whereby one partner agreed to buy out the interest of the other but failed to do so, and determined that there was no "economic duress" - See paragraphs 27 to 31.

Equity - Topic 1121

Equitable relief - Contracts - Unconscionable bargain - General - The Nova Scotia Supreme Court, Trial Division, discussed when a contract will be set aside in equity for unconscionability - The court refused to set aside a contract for unconscionability where the parties had independent legal advice, the party alleging unconscionability was not forthright in his dealings surrounding the execution of the contract and there was no unfair advantage or inequality of bargaining power between the parties - See paragraphs 13 to 26.

Cases Noticed:

Lloyd's Bank Limited v. Bundy, [1974] 3 All E.R. 757, appld. [para. 15].

National Westminster Bank v. Morgan, [1985] 1 All E.R. 821, appld. [para. 17].

A & K Lick-a-Chick Franchises Limited v. Cordiv Enterprises Limited, Divito and Cordeau (1981), 44 N.S.R.(2d) 159; 83 A.P.R. 159, dist. [para. 25].

Ronald Elwyn Lister v. Dunlop Canada (1979), 27 O.R.(2d) 168, appld. [para. 27].

Authors and Works Noticed:

Fridman, G.H.L., The Law of Contract (1976), p. 127 [para. 14].

Counsel:

James L. Connors, for the plaintiff;

Lawrence W. Scaravelli, for the defendant.

This case was heard on April 10, 1986, before Nunn, J., of the Nova Scotia Supreme Court, Trial Division, who delivered the following decision on April 16, 1986: