IFP Technologies (Canada) Inc. v. Encana Midstream and Marketing et al., (2014) 591 A.R. 202 (QB)

• Judge: Stevens,Wittmann
• Neutral Citation: 2014 ABQB 470
• Citation: (2014), 591 A.R. 202 (QB),2014 ABQB 470,591 AR 202,(2014), 591 AR 202 (QB),591 A.R. 202
• Date: 14 March 2011
• Court: Court of Queen's Bench of Alberta (Canada)

IFP Tech. (Can.) Inc. v. Encana Midstream (2014), 591 A.R. 202 (QB)

MLB headnote and full text

Temp. Cite: [2014] A.R. TBEd. AU.108

IFP Technologies (Canada) Inc. (plaintiff/defendant by counterclaim) v. Encana Midstream and Marketing, PanCanadian Resources, Encana Corporation, Encana Oil & Gas Developments Ltd., Canadian Forest Oil Ltd. and The Wiser Oil Company (defendants/plaintiffs by counterclaim)

(0301 03520; 2014 ABQB 470)

Indexed As: IFP Technologies (Canada) Inc. v. Encana Midstream and Marketing et al.

Alberta Court of Queen's Bench

Judicial District of Calgary

Wittmann, C.J.Q.B.

July 30, 2014.

Summary:

IFP Technologies (Canada) Inc. and PanCanadian Resources (PCR) entered into an asset exchange contract in which IFP provided technology and gave up its overriding royalty, in exchange for a working interest in Eyehill Creek. IFP claimed that PCR breached the contract when it farmed out its interest in the Eyehill Creek reservoir to Wiser Oil Co. without IFP's consent. IFP sought damages for the loss of opportunity to pursue thermal and other enhanced recovery at Eyehill Creek. A key liability issue was whether IFP acted reasonably when it refused to consent to the proposed transaction between PCR and Wiser.

The Alberta Court of Queen's Bench found that IFP was unreasonable in withholding its consent to the Abandonment Reclamation and Option Agreement between PCR and Wiser. Wiser was novated into the Joint Operating Agreement and IFP retained its 20% working interest in thermal and other enhanced recovery at Eyehill Creek. If there was a breach, the Court found that the opportunity to pursue thermal or other enhanced recovery had not been destroyed; there had been no loss of opportunity. If IFP did lose an opportunity, it had failed to prove the value of its lost opportunity and the Court could not therefore make a damages award.

Contracts - Topic 4062

Remedies for breach - Accounting of profits (disgorgement) - When available or appropriate - IFP claimed PCR breached the Asset Exchange Agreement (AEA) between the parties when it farmed out its interest in Eyehill Creek to Wiser Oil without IFP's consent - IFP claimed an accounting of profits from Wiser and Canadian Forest, who were actively developing the property, on the basis the beneficial working interests in the property were held by IFP and Canadian Forest as co-tenants and that there was no contractual relationship between IFP and Canadian Forest - IFP's position was that the AEA granted it an undivided interest equal to 20% of PCR's working interest in Eyehill Creek and that it was only the Joint Operating Agreement (JOA) that limited the working interest to thermal and other enhanced recovery - According to IFP, the breach of contract terminated the JOA - Consequently, IFP submitted it now held a 20% working interest in the lands without limitation on the type of recovery - Canadian Forest argued that it was entitled to the benefit of the JOA, pursuant to which IFP agreed it was not entitled to benefit from primary production - The Alberta Court of Queen's Bench held that IFP had no contractual entitlement to a share of the proceeds of primary production - IFP was unreasonable in withholding consent to the farmout agreement, and Wiser was novated into the JOA - IFP would receive the benefit of its 20% working interest in Eyehill Creek if and when a thermal or other enhanced recovery project proceeded - See paragraphs 395 to 403.

Contracts - Topic 6806

Assignment - General - Without notice or consent - [See first and second Mines and Minerals - Topic 8223 ].

Contracts - Topic 7401

Interpretation - General principles - Intention of parties (incl. reasonable expectations of parties) - The Alberta Court of Queen's Bench reviewed cases that had considered the concept of reasonable expectations in the performance of a contract, and concluded that "[a] reasonable expectation, therefore, is an expectation held by both parties regarding the performance of obligations under the contract. One party's expectation cannot create an obligation on another party if that expectation is not shared. Reasonable expectations are rarely stated within a contract; rather, the reasonable expectations are an underlying principle of contractual performance in which each party performs in a manner consistent with the objectives, benefits and obligations of the contract. ... [A]ssessing whether expectations are reasonable requires an examination of the written agreements. The commercial context can also inform the interpretation of whether expectations are reasonable." - See paragraphs 208 and 211.

Contracts - Topic 7401

Interpretation - General principles - Intention of parties (incl. reasonable expectations of parties) - [See third and fourth Mines and Minerals - Topic 8223 ].

Damage Awards - Topic 1008

Contracts - Breach of contract - Loss of business opportunity - IFP claimed PCR breached the Asset Exchange Agreement (AEA) between the parties when it farmed out its interest in Eyehill Creek - IFP sought $45 million in damages for the loss of opportunity to pursue thermal and other enhanced recovery at Eyehill Creek - PCR submitted that even if the Court wholly accepted the claim, IFP was contractually limited to recover a maximum aggregate amount of $16 million pursuant to the AEA: "In no event shall the liability of PCR to IFP in respect of claims of IFP arising out of or in connection with this Agreement exceed, in the aggregate, the value for the PCR Assets ... [$16 million], taking into account any and all increases or decreases to such value that occur by virtue of the terms of this Agreement." - The Alberta Court of Queen's Bench found that any damages, had they been awarded, would have been limited to a maximum of $16 million - Given the language of the contract, IFP's claim for $45 million in damages was untenable - "On its face, a limitation of damages clause is legitimate and enforceable. IFP and PCR are sophisticated business entities who negotiated the AEA with the assistance of legal counsel. There is no indication of unconscionability or oppression at the time the contract was negotiated. There are also no public policy reasons to ignore the limitation clause." - See paragraphs 404 to 406.

Damages - Topic 206

Entitlement - Loss of chance - [See both Damages - Topic 1527 ].

Damages - Topic 1002

Mitigation - Duty to mitigate - IFP and PCR entered into an asset exchange agreement in which IFP provided technology and gave up its overriding royalty, in exchange for a working interest in Eyehill Creek - IFP claimed that PCR breached the contract when it farmed out its interest in the Eyehill Creek reservoir to Wiser Oil Co. without IFP's consent - IFP sought damages for the loss of opportunity to pursue thermal and other enhanced recovery at Eyehill Creek - The Alberta Court of Queen's Bench did not award damages, but addressed the parties' mitigation arguments - The Court rejected the defendants' claim that IFP failed to mitigate its damages - The onus was on the defendants to prove that IFP failed to take reasonable steps to mitigate its losses - Mitigation required only that a plaintiff take reasonable steps to avoid loss - The Court accepted IFP's argument that it would have been unreasonable to seek an operating partner and expend the money necessary to initiate a thermal development at Eyehill Creek while Wiser, and later Canadian Forest, were actively developing the field - See paragraphs 386 to 394.

Damages - Topic 1527

General damages - Elements of - Loss of opportunity (incl. interdependent relationship) - IFP claimed PCR breached the Asset Exchange Agreement between the parties when it farmed out its interest in Eyehill Creek - IFP sought damages for the loss of opportunity to pursue thermal and other enhanced recovery at Eyehill Creek - The Alberta Court of Queen's Bench, despite its finding that PCR was not liable for breach of contract, undertook a provisional assessment for loss of opportunity damages - The Court set out the general principles, and summarized the following steps in assessing damages - "(1) deciding whether the claim for lost opportunity is real, as opposed to fanciful; (2) assessing the value of the opportunity if it had been realized; and (3) assessing the likelihood the opportunity would have been realized and discounting the damages to reflect the possibility that the opportunity would not have been realized in any event." - See paragraphs 272 to 277.

Damages - Topic 1527

General damages - Elements of - Loss of opportunity (incl. interdependent relationship) - IFP claimed PCR breached the Asset Exchange Agreement between the parties when it farmed out its interest in Eyehill Creek - IFP sought damages for the loss of opportunity to pursue thermal and other enhanced recovery at Eyehill Creek - The Alberta Court of Queen's Bench, despite its finding that PCR was not liable for breach of contract, undertook a provisional assessment for loss of opportunity damages - The question was whether IFP's opportunity to benefit from development in 2001 (the time of the alleged breach) was real, not whether it was likely in the existing economic environment - IFP established that it had a real opportunity (paragraphs 280 to 285) - The second stage of the analysis was to determine the value of the lost opportunity - Given the difficulties with IFP's damages model resulting from critical errors introduced by several experts, any figure the Court selected for damages would be a guess - The Court rejected IFP's invitation to look elsewhere in the evidence for value - In the result, the Court was unable to assign a value to the lost opportunity (paragraphs 286 to 364) - The third part of the analysis required the Court to consider the likelihood IFP would have realized on the opportunity, and to apply an appropriate discount for the likelihood of non-occurrence - The Court concluded that there was no chance a thermal development would have proceeded at Eyehill Creek within a reasonable time of the alleged breach - Even if the Court had awarded damages, it would have discounted them by 100% to reflect the "chance of non-occurrence" - See paragraphs 365 to 385.

Mines and Minerals - Topic 8223

Oil and gas - Operation and production agreements - Farmout agreement - The plaintiff ("IFP") claimed that the defendant ("PCR"), breached its contract with IFP when it farmed out its interest in a reservoir to "Wiser Oil", without IFP's consent - A key liability issue was whether IFP acted reasonably when it refused to consent to the proposed transaction between PCR and Wiser Oil - The parties relied primarily on case law regarding reasonable withholding of consent in the landlord-tenant context - The Alberta Court of Queen's Bench, in discussing the legal principles applicable, stated that "[t]he court should not defer to the party withholding consent, but must assess the reasons for withholding consent and consider whether a reasonable person in similar circumstances would have made the same decision. The court should consider the purpose of the consent clause and the meaning and benefit it was intended to confer. ... The nature of the exercise before this Court, therefore, involves examining all the circumstances, including the commercial realities of the marketplace, the status quo under the agreements, the economic impact of the assignment and all other relevant factors to determine whether IFP acted reasonably in withholding its consent to the disposition to Wiser." - See paragraphs 158 and 166.

Mines and Minerals - Topic 8223

Oil and gas - Operation and production agreements - Farmout agreement - This was a claim for damages arising out of an alleged breach of contract - Clause 2401B(e) was at the core of the case - The relevant portion provided that "a party shall not dispose of any of its working interest, whether by assignment, sale, trade, lease, sublease, farmout or otherwise, without first complying with the provisions of Alternate B" - Alternate B described the requirement for consent, "which must not be unreasonably withheld" - IFP claimed PCR breached the contract between the parties when it farmed out its interest in Eyehill Creek to Wiser Oil, without IFP's consent - PCR argued that IFP acted unreasonably in withholding its consent - IFP claimed that primary development of Eyehill Creek would harm its interest in future thermal or other enhanced recovery operations, thereby having a material adverse effect on its working interest - PCR submitted that Wiser was doing no more than what PCR was entitled to do; the status quo was unchanged and IFP's justification for withholding consent was plainly unreasonable - The Alberta Court of Queen's Bench held that IFP was unreasonable in withholding its consent to the farmout agreement - The Court found comparison to the status quo to be a very important aspect of the analysis, as was the commercial reality of the marketplace at the time - See paragraphs 167 to 193.

Mines and Minerals - Topic 8223

Oil and gas - Operation and production agreements - Farmout agreement - IFP claimed PCR breached the contract between the parties when it farmed out its interest in Eyehill Creek to Wiser Oil without IFP's consent - Eyehill Creek had been identified as a potential candidate for development using steam-assisted gravity drainage (SAGD), a type of enhanced oil recovery process - The Alberta Court of Queen's Bench found that IFP acted unreasonably in withholding its consent to the farmout agreement - "I can appreciate why IFP believed the disposition to Wiser would be likely to have a material adverse effect on its working interest or future operations. The problem is that such belief must be objectively reasonable. IFP had the unilateral expectation that PCR would initiate a SAGD operation and would refrain from primary production, but the agreements provide no basis for this expectation. Furthermore, in the context of an industry mandating development rather than sitting on rights, an agreement in which each party could make decisions based on its own interests, and tenants-in-common ownership, I find it was unreasonable for IFP to object to the disposition to Wiser on the grounds Wiser would undertake something PCR was entitled to do and in fact was doing. It is not objectively reasonable to withhold consent and prohibit the alienation of PCR's interests on that basis." - See paragraph 198.

Mines and Minerals - Topic 8223

Oil and gas - Operation and production agreements - Farmout agreement - IFP claimed PCR breached the contract between the parties when it farmed out its interest in Eyehill Creek to Wiser Oil without IFP's consent - The Abandonment Reclamation and Option Agreement (ARO) between PCR and Wiser set out the rights and interests PCR transferred to Wiser - IFP claimed that PCR's action in entering into the ARO with Wiser constituted a breach of contract because it undermined the reasonable expectations of the parties at the time of contracting to pursue thermal development at Eyehill Creek - The Alberta Court of Queen's Bench rejected IFP's argument that it had a reasonable expectation that PCR would not pursue primary production at Eyehill Creek - "There is nothing in the agreements prohibiting primary production, as conceded by several IFP witnesses. If IFP wanted such a prohibition, it ought to have negotiated it as a term of the agreement. IFP has not identified any specific provision of the contract or industry practice that would indicate its expectations were reasonable. In the absence of express terms or shared expectations regarding primary production, IFP's argument on this ground must fail." - See paragraphs 209 to 212.

Mines and Minerals - Topic 8223

Oil and gas - Operation and production agreements - Farmout agreement - IFP claimed PCR breached the contract between the parties when it farmed out its interest in Eyehill Creek to Wiser Oil without IFP's consent - The Abandonment Reclamation and Option Agreement (ARO) between PCR and Wiser set out the rights and interests PCR transferred to Wiser - IFP claimed that PCR's action in entering into the ARO with Wiser constituted a breach of contract - The Alberta Court of Queen's Bench first found that IFP was unreasonable in withholding its consent to the ARO and that IFP's reasonable expectations argument failed - The Court next decided what flowed from these findings - "[T]he majority of the case law related to unreasonable withholding of consent comes from the landlord and tenant context. In those cases, when the court finds a landlord has unreasonably withheld consent to an assignment the effect is to dispense with the consent requirement" - The academic literature supported that approach - Applying those principles, IFP, in unreasonably withholding consent, freed PCR from the consent requirement - PCR was thus free to proceed with the ARO in the absence of IFP's consent since such consent was unreasonably withheld - Wiser was novated into the agreements between PCR and IFP, and the Joint Operating Agreement continued to bind Wiser and IFP - See paragraphs 213 to 219.

Mines and Minerals - Topic 8223

Oil and gas - Operation and production agreements - Farmout agreement - IFP claimed PCR breached the Asset Exchange Agreement between the parties when it farmed out its interest in Eyehill Creek to Wiser Oil - IFP sought damages for the loss of opportunity to pursue thermal and other enhanced recovery at Eyehill Creek - The Alberta Court of Queen's Bench was not persuaded that it was no longer possible to pursue thermal or other enhanced recovery operations in the Eyehill Creek reservoir - The improved technologies could overcome the challenges arising from the depletion of the reservoir caused by Wiser's primary operations, although there would be a higher cost in doing so - IFP had not proven that its working interest had been destroyed by the primary operations, although its value might have been reduced - "While the benefits of IFP's working interest may be more expensive to realize and there is now less oil in the ground, I was provided with limited evidence as to the increased costs of any future development. There is no way for me to calculate the value of any such potential loss. ... Furthermore, I note the contradictory nature of IFP's claim on this ground: IFP objects to Wiser's surrender of these lands, yet it also objects to Wiser's primary production, the most common method of maintaining leases in good standing." - See paragraphs 220 to 269.

Mines and Minerals - Topic 8223

Oil and gas - Operation and production agreements - Farmout agreement - IFP claimed PCR breached the contract between the parties when it farmed out its interest in Eyehill Creek to Wiser Oil without IFP's consent - The Alberta Court of Queen's Bench concluded that "[t]he contractual matrix entered into is at odds with the unilateral expectations of IFP. Were it to be granted the remedy asked for, the Court would, of necessity, acknowledge a better set of contracts conferring rights on IFP that IFP did not negotiate in the first instance. IFP cannot attain a remedy which it could not have obtained from PCR. IFP did not bargain for a joint venture, notwithstanding its unilateral expectations in this regard. It provided technology in exchange for a working interest. IFP's working interest was restricted to EOR [enhanced oil recovery]. It had no interest in primary production. Yet, primary production was contemplated in the contractual matrix. In conclusion, I find IFP was unreasonable in withholding its consent to the ARO [Abandonment Reclamation and Option Agreement] between PCR and Wiser. Wiser was novated into the JOA [Joint Operating Agreement] and IFP retains its 20% working interest in thermal and other enhanced recovery at Eyehill Creek. If I am wrong in this conclusion and there was a breach, I find that the opportunity to pursue thermal or other enhanced recovery has not been destroyed; there has been no loss of opportunity. If I am wrong in this conclusion and IFP did lose an opportunity, I find that IFP has failed to prove the value of its lost opportunity and this Court cannot therefore make a damages award." - See paragraphs 407 to 410.

Mines and Minerals - Topic 8236

Oil and gas - Operation and production agreements - Sale or transfer of interest - [See seventh Mines and Minerals - Topic 8223 ].

Cases Noticed:

Qunatrill et al. v. Alcan-Colony Contracting Co. Ltd. et al. (1978), 18 O.R.(2d) 333 (C.A.), refd to. [para. 133].

Spartan Developments Ltd. et al. v. 206559 Developments Ltd. et al. (2003), 346 A.R. 124; 320 W.A.C. 124; 2004 ABCA 12, refd to. [para. 136].

Opron Construction Co. v. Alberta (1994), 151 A.R. 241 (Q.B.), refd to. [para. 137].

Chapman Management & Consulting Services Ltd. v. Kernic Equipment Sales Ltd., [2004] A.R. Uned. 821; 2004 ABQB 870, refd to. [para. 139].

Sundance Investment Corp. v. Richfield Properties Ltd. et al. (1983), 41 A.R. 231 (C.A.), refd to. [para. 153].

Community Drug Marts P & S Inc. v. William Schwartz Construction Co. Ltd. (1980), 31 A.R. 466 (Q.B.), affd. [1981] A.J. No. 537, refd to. [para. 154].

Coopers & Lybrand Ltd. v. William Schwartz Construction Co. Ltd. - see Community Drug Marts P & S Inc. v. William Schwartz Construction Co. Ltd.

Exxonmobil Canada Energy v. Novagas Canada Ltd. et al. (2002), 318 A.R. 99; 2002 ABQB 455, refd to. [para. 155].

1455202 Ontario Inc. v. Welbow Holdings Ltd., [2003] O.T.C. 396 (Sup. Ct.), refd to. [para. 155].

Zellers Inc. v. Brad-Jay Investments Ltd., [2002] O.T.C. 795 (Sup. Ct.), refd to. [para. 159].

Hayes Forest Services Ltd. et al. (Bankrupt), Re, [2009] B.C.T.C. Uned. 1169; 2009 BCSC 1169, refd to. [para. 162].

Kaiser Francis Oil Co. of Canada v. Bearspaw Petroleum Ltd. et al. (1999), 240 A.R. 59; 1999 ABQB 128, refd to. [para. 165].

Bromley Park Garden Estates Ltd. v. Moss, [1982] 2 All E.R. 890 (C.A.), refd to. [para. 184].

Hayes Forest Services Ltd. v. Weyerhaeuser Co., [2007] B.C.T.C. Uned. 405; 2007 BCSC 722, refd to. [para. 188].

Mesa Operating Limited Partnership v. Amoco Canada Resources Ltd. (1994), 149 A.R. 187; 63 W.A.C. 187 (C.A.), consd. [para. 199].

Maritime Life Assurance Co. v. Regional Capital Properties Corp. et al. (1996), 190 A.R. 306 (Q.B. Master), affd. (1996), 195 A.R. 102 (Q.B.), refd to. [para. 202].

National Courier Services Ltd. v. RHK Hydraulic Cylinder Services Inc. et al. (2005), 390 A.R. 158; 2005 ABQB 856, consd. [para. 204].

Schluessel et al. v. Maier et al., [2001] B.C.T.C. 60; 2001 BCSC 60, revd. in part on other grounds, [2003] B.C.A.C. Uned. 120; 2003 BCCA 405, consd. [para. 206].

National Trustco v. Mead, [1990] 2 S.C.R. 410; 112 N.R. 1; 87 Sask.R. 161, refd to. [para. 217].

Ticketnet Corp. v. Air Canada (1997), 105 O.A.C. 87; 154 D.L.R.(4th) 271 (C.A.), leave to appeal refused (1998), 230 N.R. 400; 161 D.L.R.(4th) viii (S.C.C.), refd to. [para. 272].

Nathu v. Imbrook Properties Ltd. (1992), 125 A.R. 34; 14 W.A.C. 34 (C.A.), refd to. [para. 272].

Davies v. Taylor, [1974] A.C. 207 (H.L.), refd to. [para. 274].

Penvidic Contracting Co. v. International Nickel Co. of Canada Ltd., [1976] 1 S.C.R. 267; 4 N.R. 1, refd to. [para. 275].

Argus Machine Co. Ltd. v. Stan's Power Tong Service Ltd. (1988), 93 A.R. 18 (C.A.), affd. (1989), 97 A.R. 314 (C.A.), refd to. [para. 275].

Rec Holdings Co. et al. v. Peat Marwick Thorne et al., [1997] B.C.T.C. Uned. A28 (S.C.), refd to. [para. 275].

Sunshine Exploration Ltd. v. Dolly Varden Mines Ltd. (N.P.L.), [1970] S.C.R. 2, refd to. [para. 276].

Envirodrive Inc. v. 836442 Alberta Ltd. et al., 2005 ABQB 446, refd to. [para. 332].

Jacobson v. Sveen et al. (2000), 262 A.R. 367; 2000 ABQB 215, refd to. [para. 333].

Malton v. Attia et al. (2013), 573 A.R. 200; 2013 ABQB 642, refd to. [para. 334].

1159465 Alberta Ltd. v. Adwood Manufacturing Ltd. et al., [2010] A.R. Uned. 145; 2010 ABQB 133, affd. [2011] A.R. Uned. 347; 2011 ABCA 259, refd to. [para. 334].

McNamara Construction v. Balfour Beatty Power Networks Ltd. et al. (2007), 272 Nfld. & P.E.I.R. 53; 830 A.P.R. 53; 2000 CarswellNfld 402 (N.L.T.D.), refd to. [para. 338].

Frazer et al. v. Haukioja (2008) 58 C.C.L.T.(3d) 259 (Ont. Sup. Ct.), refd to. [para. 338].

McAlpine (Robert) Ltd. v. Byrne Glass Enterprises Ltd. et al. (2001), 141 O.A.C. 167 (C.A.), refd to. [para. 356].

Prothroe v. Adams et al. (1997), 203 A.R. 321 (Q.B.), refd to. [para. 361].

Athey v. Leonati et al., [1996] 3 S.C.R. 458; 203 N.R. 36; 81 B.C.A.C. 243; 132 W.A.C. 243, refd to. [para. 367].

British Westinghouse Electric & Manufacturing Co. v. Underground Electric Railway Co. of London, [1912] A.C. 673 (H.L.), refd to. [para. 386].

Biranda v. Anderson (1978), 16 A.R. 330 (Dist. Ct.), refd to. [para. 386].

Costello and Dickhoff v. Calgary (City) (1997), 209 A.R. 1; 160 W.A.C. 1 (C.A.), refd to. [para. 387].

Southcott Estates Inc. v. Toronto Catholic District School Board, [2012] 2 S.C.R. 675; 435 N.R. 41; 2012 SCC 51, refd to. [para. 393].

Midcon Oil & Gas Co. v. New British Dominion Oil Co., [1958] S.C.R. 314, refd to. [para. 396].

Authors and Works Noticed:

Bankes, Nigel, and Quesnel, Alicia, Recent Developments of Interest to Oil and Gas Lawyers (2000), 38 Alta. L. Rev. 294, p. 357 [para. 201].

Bentley, Christopher, McNair, John, and Butkus, Mavis, Canadian Law of Landlord and Tenant (6th Ed. 2013), vol. 2 (Looseleaf, June 11, 2014), p. 15-51 [para. 215].

Litman, M.M., and B.H. Ziff, Annotation to Sundance Investment Corp. v. Richfield Properties Ltd. et al., 24 Alta. L.R.(2d) 1, p. 2-4 [para. 191].

McGregor, Harvey, McGregor on Damages (18th Ed. 2009), p. 345 [para. 274].

Counsel:

Paul Edwards, Counsel for the plaintiff/defendant by counterclaim;

Rinus de Waal, Co-counsel for the plaintiff/defendant by counterclaim;

Grant N. Stapon, Q.C., Laurie A. Goldbach and Lawrence D. Ator, Counsel for the defendants/plaintiffs by counterclaim.

This trial was heard between January 31 and March 14, 2011, and oral argument on June 29 and 30, 2011, before Stevens, J., who passed away on May 13, 2014. Pursuant to rule 13.1, Wittmann, C.J.Q.B., of the Alberta Court of Queen's Bench, took conduct of the matter and delivered the following judgment and reasons, dated at Calgary, Alberta, on July 30, 2014.