Elbow River Marketing Limited Partnership v. Canada Clean Fuels Inc. et al., 2012 ABQB 277

• Judge: Tilleman, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: December 09, 2011
• Citations: 2012 ABQB 277;(2012), 538 A.R. 145 (QB)

Elbow River Marketing v. Can. Clean Fuels (2012), 538 A.R. 145 (QB)

MLB headnote and full text

Temp. Cite: [2012] A.R. TBEd. MY.044

Elbow River Marketing Limited Partnership (appellant/respondent by counterclaim) v. Canada Clean Fuels Inc. and CCF International Corp. (respondents/appellants by counterclaim)

(0801 04501; 2012 ABQB 277)

Indexed As: Elbow River Marketing Limited Partnership v. Canada Clean Fuels Inc. et al.

Alberta Court of Queen's Bench

Judicial District of Calgary

Tilleman, J.

April 26, 2012.

Summary:

Elbow River Marketing Limited Partnership (ERM) brokered fuels. It formed an agreement with CCF International Corp. to deliver diesel fuel. ERM thought it was dealing with Canada Clean Fuels Inc. (Canada Clean). ERM sued CCF and Canada Clean for breach of contractual obligations. CCF and Canada Clean applied for summary judgment to dismiss the action.

A Master of the Alberta Court of Queen's Bench granted summary judgment dismissing the action against Canada Clean, leaving CCF as the sole defendant. ERM applied to amend its statement of claim, appealed the decision of the Master, and applied to introduce new evidence on the appeal, pursuant to rule 6.14 of the new Rules of Court. The issues involved the interpretation of rule 6.14, and several issues of law, including: (a) partnership (b) agency, and (c) piercing the corporate veil.

The Alberta Court of Queen's Bench, in a decision reported at 511 A.R. 356, allowed the appeal. The question of a partnership between CCF and Canada Clean was a genuine issue for trial. In light of that decision, the court did not address agency and the piercing of the corporate veil, and refrained from deciding ERM's application to amend the pleadings. CCF and Canada Clean appealed.

The Alberta Court of Appeal, in a decision reported at 2011 ABCA 258, returned the matter to the Court of Queen's Bench, to be reheard.

The Alberta Court of Queen's Bench made the following orders: "(1) Pursuant to Rule 3.65, ERM is permitted to file and serve the proposed Amended Statement of Claim in its entirety. To be effective, the pleading must be filed and served within 30 days of this decision. (2) The action as against Canada Clean Fuels Inc. will proceed to trial with respect to the partnership claim only. The claims related to agency and 'piercing the corporate veil' are dismissed."

Agency - Topic 301

Creations of relations - General - What constitutes - The plaintiff alleged that the defendant corporation "Canada Clean" was liable under the contract that the plaintiff entered into with the defendant corporation "CCF", on the ground that CCF was an agent of Canada Clean - The Alberta Court of Queen's Bench stated that "[t]he usual test for agency is the existence of an agency agreement (express or implied) whereby the principal agrees to have the agent act on the principal's behalf. However, agency can also be found where one entity (usually a controlling shareholder) exerts extensive control over a corporation alleged to be acting as agent. It is in this context that a corporation is sometimes said to be a 'sham', 'cloak', 'conduit', or 'alter ego' ... There is much overlap between what I will call here 'agency by control' and some of the principles related to piercing the corporate veil." - See paragraph 124 - "Another manner is which a principal may be liable for the acts of an agent, even in the absence of an agency agreement, is by estoppel. Agency by estoppel arises where the (1) the principal represents that the agent has the authority to act on its behalf in the way the agent is acting; (2) a third party relies on the representation; (3) the party alters its position as a result of the reliance" - See paragraph 131.

Agency - Topic 301

Creations of relations - General - What constitutes - ERM sued CCF and Canada Clean, sister corporations, for breach of contractual obligations - A ground on which ERM alleged that Canada Clean was liable under the contract that ERM entered into with CCF, was that CCF was an agent of Canada Clean - A Master decided that the question was not a genuine issue for trial, and granted summary judgment to Canada Clean, dismissing the action against it - The Alberta Court of Queen's Bench held that the Master's ruling stood - There was no arguable case for agency on the specific grounds advanced by ERM, namely, by estoppel and by control - ERM's argument related to agency by estoppel could not succeed, as it had not pointed to any communication or conduct by Canada Clean that was unequivocally a representation that CCF was its agent - Its claim of agency by control also failed, because, while Canada Clean might very well have controlled CCF, that was not enough to establish liability as principal in the absence of other very clear evidence of agency, or of fraud or dishonesty, or of some other inappropriate reason for the corporate structure that was employed - There was nothing in the evidence that gave ERM's agency claim a chance of success at trial - See paragraphs 136 to 168.

Company Law - Topic 313

Nature of corporations - Lifting the corporate veil - Related companies - ERM sued CCF and Canada Clean, sister corporations, for breach of contractual obligations - A ground on which ERM alleged that Canada Clean was liable under the contract that ERM entered into with CCF, was that it was appropriate to "pierce the corporate veil" that separated Canada Clean from its parents and sisters - In a summary judgment application, the Master did not allow a claim on that basis to proceed (claim not adequately pleaded), and dismissed the action against Canada Clean - On this appeal, the Alberta Court of Queen's Bench considered the claim on its merits - The court set out the traditional bases on which courts had lifted the corporate veil - See paragraphs 173 to 193 - In the end result, the court concluded that it was not too flagrantly unjust to decline to pierce the corporate veil - It was plain and obvious that a claim based on piercing the veil would fail, and the court therefore dismissed that claim - "Piercing the corporate veil renders the theory of corporate law useless, and except for cases of fraud or manifest injustice, I am not prepared to do that" - See paragraphs 194 to 205.

Company Law - Topic 4801

Contracts by companies - Contracts by agents - General - [See first Agency - Topic 301 ].

Courts - Topic 1127

Masters - Appeals from - Standard of review - The Alberta Court of Queen's Bench considered the appropriate level of deference that was owed to a Master under the change in the Rules of Court - "Until the new Rules of Court came into effect in Alberta in 2010 it was long-settled law in Alberta that a superior court judge had unrestricted ability to substitute his/her discretion for that of a Master ... [T]his was based in part on the fact that appeals from a master were hearings de novo. Under the new rules, appeals from Masters' decisions are on the record, though the judge still retains discretion to admit new evidence if it is relevant and material: Rule 6.14(3). ... In summary, the standard of review that I apply in this appeal is that of correctness for questions of law, and deference absent 'palpable and overriding error' for findings of fact." - See paragraphs 50 to 54.

Courts - Topic 8350

Provincial courts - Alberta - Court of Queen's Bench - Jurisdiction - Appeals from Master - A Master granted summary judgment to the defendant Canada Clean, dismissing the action brought against it by ERM, leaving CCF as the sole defendant - ERM appealed - The Court of Queen's Bench reversed the Master's decision - Canada Clean and CCF then appealed to the Court of Appeal - The Court of Appeal returned the matter to the Court of Queen's Bench, to be reheard - ERM argued that the issue of whether or not Canada Clean and CCF were partners should not be reheard or reconsidered - The Alberta Court of Queen's Bench considered all of the grounds of the appeal, including the partnership issue - The Court of Appeal had allowed the appeal - In the result, it was as if the decision of the Court of Queen's Bench never happened - That being the case, the issue of whether the partnership question was a genuine issue for trial could not be res judicata - Further, the doctrines of res judicata, issue estoppel and abuse of process applied to the rehearing of an issue or case in a subsequent action; this was the same action - In any event, it was permissible, even preferable, to relitigate an issue when fairness dictated that the original result should not be binding in the new context - See paragraphs 41 to 49.

Estoppel - Topic 386

Estoppel by record (res judicata) - Res judicata as a bar to subsequent proceedings - Issues decided in prior proceedings (incl. validity of statutes) - [See Courts - Topic 8350 ].

Estoppel - Topic 1103

Estoppel in pais (by conduct) - Representation - By statement - Representations which found estoppel - [See third Partnership - Topic 10 ].

Estoppel - Topic 1164

Estoppel in pais (by conduct) - Representation - By conduct - Course of conduct by litigant - [See third Partnership - Topic 10 ].

Partnership - Topic 10

General - Partnership - What constitutes - The case at bar directly engaged the defendants' potential liability as partners, in the context of whether the partnership question presented a triable issue - The defendants asserted that the Partnership Act did not prevail, that the Act provided indicia of a partnership but that the existence of a partnership was ultimately a matter of contract - The Alberta Court of Queen's Bench stated that the defendants' assertion "that partnership is created by agreement, not statute, is true only in the sense that, unlike a corporation - which is an entirely statutory construction that exists solely at the whim of its governing statute - a partnership is created by the will and acts of its partners, rather than by the granting of registration by a governing authority in compliance with corporate legislation. In that sense, I agree that partnerships exist independently of statute. However, since the enactment of the Partnership Act, it is the Act that determines how to recognize if a partnership exists. ... [T]he Act is not a complete code, but it does prevail." - See paragraphs 74 to 76.

Partnership - Topic 10

General - Partnership - What constitutes - The Alberta Court of Queen's Bench stated that "[t]he Supreme Court has deconstructed the definition of partnership common to the various Partnership Acts, noting that a partnership has 'three essential ingredients: (1) a business, (2) carried on in common, (3) with a view to profit.'" - In the case at bar, the court considered each of the three essential ingredients and used them as a framework to decide whether the partnership question presented a triable issue - See paragraphs 77 to 95.

Partnership - Topic 10

General - Partnership - What constitutes - The Alberta Court of Queen's Bench stated that, even if there was no express partnership agreement and none could be inferred, a person could be liable as an apparent partner, combining concepts of holding out and partnership by estoppel (Partnership Act, s. 17(1)) - To be liable under s. 17(1), "an apparent partner must either make a representation or knowingly permit the representation, but the representation can be by conduct. ...[T]he third party advancing a claim against the apparent partner must have relied upon the representation, though the plaintiff need not show that it acted solely because of the representation ... Furthermore, the third party creditor may not advance a claim on the basis of this section if the creditor was aware of the true state of affairs; i.e., if the plaintiff knew that the apparent partner was not a partner, its claim cannot succeed ... This flows logically from the reliance requirement." - See paragraphs 96 and 97.

Partnership - Topic 10

General - Partnership - What constitutes - CCF and Canada Clean (the defendants) applied for summary judgment to dismiss the action brought against them by ERM - One of the alleged grounds of liability of Canada Clean for CCF's contractual obligations was that the defendants were partners - ERM had adduced evidence that the defendants shared, inter alia, office space, a website, telephone numbers, staff, bank accounts, management, and ownership - The defendants were in the business of dealing in biodiesel fuel, and had dealings with ERM in relation to the same contracts - The defendants adduced evidence meant to show that the partnership issue was not a genuine issue for trial - That evidence took the form of an affidavit of Angelucci, the president of both defendants - A Master granted summary judgment dismissing the action against Canada Clean, leaving CCF as the sole defendant - The Alberta Court of Queen's Bench held that the defendants had not met their burden of showing that there was no genuine issue to be tried - Angelucci's statements that the defendants were not partners and did not represent that they were partners were more in the nature of a legal conclusion than statements of fact addressing the partnership indicia - The Master placed too much emphasis on Angelucci's statements to the exclusion of, for example, the conduct of the defendants - In the end result, the court ordered that the action as against Canada Clean proceed to trial with respect to the partnership claim - See paragraphs 98 to 103.

Partnership - Topic 10

General - Partnership - What constitutes - CCF and Canada Clean (the defendants) applied for summary judgment to dismiss the action brought against them by ERM - One of the alleged grounds of liability of Canada Clean for CCF's contractual obligations was that the defendants were partners - ERM had adduced evidence that the defendants shared, inter alia, office space, a website, telephone numbers, staff, bank accounts, management, and ownership - The defendants were in the business of dealing in biodiesel fuel, and had dealings with ERM in relation to the same contracts - The Alberta Court of Queen's Bench held that the defendants had not met their burden of showing that there was no genuine issue for trial - In any event, ERM had adduced sufficient evidence to persuade the court that there was a genuine issue to be tried - It was not contentious that there was a "business" (the purchase and sale of biodiesel fuel), and it was conducted "with a view to profit" - The question was whether the defendants carried on that business "in common", or in the alternative if Canada Clean was otherwise liable under s. 17 of the Partnership Act (holding out) - ERM adduced significant evidence of an arrangement between the defendants that looked like a partnership, and the defendants dealt with ERM in a way that indicated that they were each part of the same business - There was also some evidence that there was actually a holding out with reliance within the meaning of s. 17 - In the end result, the question of a partnership between CCF and Canada Clean was a genuine issue for trial - See paragraphs 103 to 122.

Partnership - Topic 101

Tests of existence - General - [See first and second Partnership - Topic 10 ].

Partnership - Topic 103

Tests of existence - General principles - Carrying on business in common - [See second Partnership - Topic 10 ].

Partnership - Topic 104

Tests of existence - General principles - Carrying on business with a view of profit - [See second Partnership - Topic 10 ].

Partnership - Topic 302

Tests of existence - Holding-out - What constitutes - [See third Partnership - Topic 10 ].

Practice - Topic 666

Parties - Adding or substituting parties - Adding or substituting defendants - Application of limitation periods - [See Practice - Topic 670 ].

Practice - Topic 670

Parties - Adding or substituting parties - Adding or substituting defendants - Requirement of amendment of statement of claim - A Master granted summary judgment to the defendant Canada Clean, dismissing the action against it, leaving CCF as the sole defendant - The management and ownership between Canada Clean and CCF overlapped - The plaintiff applied to amend its statement of claim and appealed the Master's decision - The amendments had the effect of adding Canada Clean, previously struck from the action - The defendants objected to the amendments on the ground that "an amendment may not add a new party or a new cause of action after the expiry of a limitation period, 'unless permitted by statue'" - The Alberta Court of Queen's Bench added Canada Clean as a defendant - The amendments met the requirements of s. 6(4) of the Limitations Act, namely, they related to the "conduct, transaction or events described in the original pleading" - Also, Canada Clean had sufficient knowledge of the claim that it would not be prejudiced in maintaining a defence - The court also considered rule 3.74 of the Rules of Court, and was satisfied that the order did not result in any prejudice to Canada Clean or CCF that could not be addressed by a costs award, an adjournment, and/or terms - See paragraphs 29 to 36.

Practice - Topic 672

Parties - Adding or substituting parties - Adding or substituting defendants - Circumstances when allowed - [See Practice - Topic 670 ].

Practice - Topic 712

Parties - Adding or substituting parties - Notwithstanding limitation period - Statutory authorization - [See Practice - Topic 670 ].

Practice - Topic 716

Parties - Adding or substituting parties - Notwithstanding limitation period - Prejudice to opposing party - [See Practice - Topic 670 ].

Practice - Topic 2110

Pleadings - Amendment of pleadings - Adding new cause of action or "claim" - A Master granted summary judgment dismissing the action against Canada Clean, leaving CCF as the sole defendant - The plaintiff (ERM) applied to amend its statement of claim, and appealed the Master's decision - The defendants objected on the basis that the amendments sought to introduce a new cause of action following expiry of the limitation period - They argued that the new claim was in misrepresentation and focussed on ERM's claim based on the intertwining of the two companies such that they should be treated as one (justifying piercing the corporation veil) - The Alberta Court of Queen's Bench held that the Limitations Act, s. 6(2), governed - Section 6(2) applied to the situation where a party was adding a claim but not adding a party - It provided that a defendant was not entitled to immunity from a new claim if "the added claim [is] related to the conduct, transaction or events described in the original pleading in the proceeding." - In this case, that condition was satisfied - In the result, pursuant to rule 3.65, the court ordered that ERM be permitted to file and serve the proposed amended statement of claim in its entirety, within 30 days of the decision - See paragraphs 37 to 39.

Practice - Topic 2111

Pleadings - Amendment of pleadings - Prohibition against adding new action or "claim" which is statute barred - [See Practice - Topic 2110 ].

Practice - Topic 2122.2

Pleadings - Amendment of pleadings - Statement of claim - On appeal - [See Practice - Topic 670 and Practice - Topic 2110 ].

Practice - Topic 2139.3

Pleadings - Amendment of pleadings - On summary judgment application - [See Practice - Topic 670 and Practice - Topic 2110 ].

Practice - Topic 2188

Pleadings - Amendment of pleadings on appeal - Amendment where opposite party not prejudiced - [See Practice - Topic 670 ].

Practice - Topic 5702

Judgments and orders - Summary judgments - Jurisdiction or when available or when appropriate - [See fourth and fifth Partnership - Topic 10 ].

Practice - Topic 5708

Judgments and orders - Summary judgments - Bar to application - Existence of issue to be tried - [See fourth and fifth Partnership - Topic 10 ].

Practice - Topic 5719

Judgments and orders - Summary judgments - To dismiss action - [See fourth and fifth Partnership - Topic 10 ].

Practice - Topic 8825.6

Appeals - General principles - Duty of appellate court on reviewing summary judgment decisions - [See Courts - Topic 1127 ].

Cases Noticed:

Ignition Energy Ltd. et al. v. Direct Energy Marketing Ltd., [2011] A.R. Uned. 166; 2011 ABQB 90, refd to. [para. 19].

Manson Insulation Products Ltd. v. Crossroads C & I Distributors et al., [2011] A.R. Uned. 82; 2011 ABQB 51, refd to. [para. 20].

Dow Chemical Canada Inc. et al. v. Nova Chemicals Corp. (2010), 495 A.R. 338; 2010 ABQB 524, refd to. [para. 20].

Barker v. Budget Rent-A-Car of Edmonton Ltd., [2011] A.R. Uned. 437; 2011 ABQB 127, refd to. [para. 22].

235049 Alberta Ltd. et al. v. 1102440 Alberta Ltd. et al. (2011), 529 A.R. 229; 2011 ABQB 720, refd to. [para. 24].

Zukiwski v. Yakmac Investments Ltd. (1999), 244 A.R. 136; 209 W.A.C. 136 (C.A.), refd to. [para. 25].

Condominium Corp. No. 0321365 et al. v. 970365 Alberta Ltd. et al. (2012), 519 A.R. 322; 539 W.A.C. 322; 2012 ABCA 26, refd to. [para. 44].

Toronto (City) et al. v. Canadian Union of Public Employees, Local 79 et al., [2003] 3 S.C.R. 77; 311 N.R. 201; 179 O.A.C. 291; 2003 SCC 63, refd to. [para. 47].

Wright v. Disposal Services Ltd. and Marsh (1977), 8 A.R. 394; 80 D.L.R.(3d) 671 (T.D.), refd to. [para. 50].

Alberta (Treasury Branches) v. Valerio (2011), 527 A.R. 278; 2011 ABQB 580, refd to. [para. 50].

Royal Bank of Canada v. Place (2010), 504 A.R. 230; 2010 ABQB 733, refd to. [para. 51].

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. 51].

Lee v. Lepage et al., [2010] A.R. Uned. 914; 2010 ABQB 829, refd to. [para. 52].

Janvier et al. v. 834474 Alberta Ltd. et al. (2010), 511 A.R. 76; 48 Alta. L.R.(5th) 156; 2010 ABQB 800, refd to. [para. 53].

Manufacturers Life Insurance Co. v. Executive Centre at Manulife Place Inc., [2011] A.R. Uned. 252; 48 Alta. L.R.(5th) 178; 2011 ABQB 189, refd to. [para. 56].

Encana Corp. v. ARC Resources Ltd. (2011), 523 A.R. 108; 2011 ABQB 431, refd to. [para. 56].

Lameman et al. v. Canada (Attorney General) et al., [2008] 1 S.C.R. 372; 372 N.R. 239; 429 A.R. 26; 421 W.A.C. 26; 2008 SCC 14, refd to. [para. 58].

Tottrup et al. v. Clearwater No. 99 (Municipal District) (2006), 401 A.R. 88; 391 W.A.C. 88; 2006 ABCA 380, refd to. [para. 60].

Pioneer Exploration Inc. Estate (Bankrupt) v. Euro-Am Pacific Enterprises Ltd. (2003), 339 A.R. 165; 312 W.A.C. 165; 2003 ABCA 298, refd to. [para. 60].

Dow Chemical Canada Inc. v. Shell Chemicals Canada et al. (2010), 477 A.R. 112; 483 W.A.C. 112; 2010 ABCA 126, leave to appeal denied (2010), 413 N.R. 389; 510 A.R. 399 (S.C.C.), refd to. [para. 60].

Murphy Oil Co. et al. v. Predator Corp. et al. (2004), 365 A.R. 326; 2004 ABQB 688, affd. (2006), 384 A.R. 251; 367 W.A.C. 251; 55 Alta. L.R.(4th) 1; 2006 ABCA 69, refd to. [para. 62].

Backman v. Minister of National Revenue, [2001] 1 S.C.R. 367; 266 N.R. 246; 2001 SCC 10, refd to. [para. 69].

Continental Bank Leasing Corp. v. Minister of National Revenue, [1998] 2 S.C.R. 298; 229 N.R. 58; 163 D.L.R.(4th) 385, refd to. [para. 77].

Cox and Wheatcroft v. Hickman (1860), 11 E.R. 431; 8 H.L. Cas. 268, refd to. [para. 82].

Sproule v. McConnell, [1925] 1 D.L.R. 982; [1925] 1 W.W.R. 609 (Sask. C.A.), refd to. [para. 82].

Green v. Harnum (2006), 259 Nfld. & P.E.I.R. 141; 781 A.P.R. 141; 19 B.L.R.(4th) 236; 2006 NLCA 46, refd to. [para. 83].

Spire Freezers Ltd. v. Minister of National Revenue, [2001] 1 S.C.R. 391; 266 N.R. 305; 2001 SCC 11, refd to. [para. 94].

Brown Economic Assessments Inc. v. Stevenson et al. (2004), 249 Sask.R. 214; 325 W.A.C. 214; 2004 SKCA 89, refd to. [para. 97].

Kamen v. Rose et al., [2001] O.T.C. 567 (Sup. Ct.), refd to. [para. 113].

Prince Albert Co-operative Association Ltd. v. Rybka, [2011] 4 W.W.R. 266; 362 Sask.R. 232; 500 W.A.C. 232; 2010 SKCA 144, refd to. [para. 114].

Partners in Psychiatry v. Canadian Psychiatric Association, [2011] O.A.C. Uned. 81; 81 B.L.R.(4th) 136; 2011 ONCA 109, refd to. [para. 115].

Director of Investigation and Research, Competition Act v. Southam Inc. et al., [1997] 1 S.C.R. 748; 209 N.R. 20; 144 D.L.R.(4th) 1, refd to. [para. 117].

Patrus v. Workers' Compensation Board (Alta.) et al. (2011), 527 A.R. 105; 2011 ABQB 523, refd to. [para. 117].

Iroquois Falls Community Credit Union Ltd. v. Co-operators General Insurance Co. et al. (2009), 249 O.A.C. 210; 2009 ONCA 364, refd to. [para. 120].

Walters et al. v. Clark (2006), 211 O.A.C. 278 (C.A.), refd to. [para. 120].

Sullivan v. Golden Intercapital (GIC) Investments Corp. et al., [2010] A.R. Uned. 387; 2010 ABQB 338, refd to. [para. 120].

Combined Air Mechanical Services Inc. et al. v. Flesch et al. (2011), 286 O.A.C. 3; 108 O.R.(3d) 1; 2011 ONCA 764, refd to. [para. 121].

Smith, Stone and Knight Ltd. v. Birmingham (City), [1939] 4 All E.R. 116 (K.B.), refd to. [para. 125].

Sun Sudan Oil Co. et al. v. Methanex Corp. et al. (1992), 134 A.R. 1; 5 Alta. L.R.(3d) 292 (Q.B.), refd to. [para. 125].

Indian Residential Schools, Re, [2002] A.R. Uned. 563; 222 D.L.R.(4th) 124; 2002 ABQB 667, refd to. [para. 131].

Freeman & Lockyer v. Buckhurst Park Properties (Mangal) Ltd., [1964] 1 All E.R. 630; [1964] 2 Q.B. 480 (Eng. C.A.), refd to. [para. 132].

Doiron v. Manufacturers Life Insurance Co. et al. (2003), 339 A.R. 371; 312 W.A.C. 371; 2003 ABCA 336, dist. [para. 132].

Vanbiesbrouck et al. v. Missere et al., [2006] O.T.C. Uned. 838; 2006 CarswellOnt 4966 (Sup. Ct.), refd to. [para. 134].

Crown Manufacturers Ltd. v. Texas Refinery Corp. of Canada Ltd. (No. 595) (1984), 31 Sask.R. 266; 5 C.L.R. 42 (Q.B.), refd to. [para. 134].

Bank of Montreal v. Canadian Westgrowth Ltd. et al. (1990), 102 A.R. 391; 72 Alta. L.R.(2d) 319 (Q.B.), refd to. [para. 162].

Salomon v. Salomon & Co., [1897] A.C. 22 (H.L.), refd to. [para. 174].

Kosmopoulos et al. v. Constitution Insurance Co. of Canada et al., [1987] 1 S.C.R. 2; 74 N.R. 360; 21 O.A.C. 4; 34 D.L.R.(4th) 208, refd to. [para. 176].

Transamerica Life Insurance Co. of Canada v. Canada Life Assurance Co. et al. (1996), 2 O.T.C. 146; 28 O.R.(3d) 423 (Gen. Div.), refd to. [para. 177].

Gregorio v. Intrans-Corp. and Paccar of Canada Ltd. (1994), 72 O.A.C. 51; 18 O.R.(3d) 527; 115 D.L.R.(4th) 200 (C.A.), refd to. [para. 177].

Tirecraft Group Inc. v. High Park Holdings ULC et al. (2010), 511 A.R. 17; 37 Alta. L.R.(5th) 330; 2010 ABQB 653, refd to. [para. 178].

Clarkson Co. v. Zhelka (1967), 64 D.L.R.(2d) 457 (Ont. H.C.), refd to. [para. 178].

Phillips v. 707739 Alberta Ltd. et al. (2000), 259 A.R. 201; 77 Alta. L.R.(3d) 302 (Q.B.), refd to. [para. 181].

Polly Peck International plc, Re, [1996] B.C.C. 486 (Eng. Ch.), refd to. [para. 184].

Dumbrell v. Regional Group of Companies Inc. et al. (2007), 220 O.A.C. 64; 85 O.R.(3d) 616; 279 D.L.R.(4th) 201 (C.A.), refd to. [para. 184].

Saskatoon Real Estate Board v. Saskatoon (City), [1988] 3 W.W.R. 338; 61 Sask.R. 215 (C.A.), refd to. [para. 185].

Casden v. Cooper Enterprises Ltd. et al. (1990), 34 F.T.R. 241 (T.D.), refd to. [para. 189].

Manley Inc. v. Fallis (1977), 2 B.L.R. 277; 38 C.P.R.(2d) 74 (Ont. C.A.), refd to. [para. 191].

Sinclair v. Dover Engineering Services Ltd. (1987), 11 B.C.L.R.(2d) 176 (S.C.), refd to. [para. 191].

B.G. Preeco I (Pacific Coast) Ltd. v. Bon Street Holding Ltd. (1989), 37 B.C.L.R.(2d) 258; 60 D.L.R.(4th) 30 (C.A.), refd to. [para. 191].

Statutes Noticed:

Limitations Act, R.S.A. 2000, c. L-12, sect. 6 [para. 21].

Partnership Act, R.S.A. 2000, c. P-3, sect. 1(g), sect. 4(c), sect. 7(a) [para. 69]; sect. 7(b) [paras. 69, 112, 113]; sect. 17(1), sect. 105 [para. 69].

Rules of Court (Alta.) (2010), rule 3.62, rule 3.65 [para. 17]; rule 3.74 [para. 18]; rule 7.3(1) [para. 55].

Authors and Works Noticed:

Canadian Encyclopedic Digest (Western, 4th Ed.), vol. 9, title 22, §44-54 [para. 181].

Fridman, Gerald Henry Louis, The Law of Agency (7th Ed. 1996), pp. 114 [para. 131]; 115 [para. 134].

Manzer, Alison R., A Practical Guide to Canadian Partnership Law (Looseleaf) (October 2011 release), paras. 1.340 [para. 83]; 1.370 [para. 71]; 2.240 to 2.310 [para. 90]; 2.242 [para. 84]; 2.330 [para. 118]; 2.340 to 2.342 [para. 84]; 2.640 [para. 83]; 2.650 [para. 72]; 2.770 [para. 85]; 2.956, 3.600 [para. 97].

McGuinness, Kevin P., Canadian Business Corporations Law (2nd Ed. 2007), §§ 2.37 [para. 129]; 2.28, 2.29, 2.45 [para. 181].

VanDuzer, J. Anthony, The Law of Partnerships & Corporations (2009), pp. 36 [paras. 79, 84]; 130 to 139 [para. 181]; 137 to 138 [para. 129].

Welling, Bruce, Corporate Law in Canada: The Governing Principles (2nd Ed. 1991), pp. 114 to 121 [para. 184].

Welling, Bruce, Corporate Law in Canada: The Governing Principles (3rd Ed. 2006), p. 139 [para. 158].

Counsel:

Norm Machida and Michael Vogel, for the appellant;

Clinton Ford, for the respondents.

This appeal was heard on December 9, 2011, before Tilleman, J., of the Alberta Court of Queen's Bench, who delivered the following memorandum of decision, dated at Calgary, Alberta, on April 26, 2012.