Jeffrie v. Hendriksen et al., (2015) 360 N.S.R.(2d) 65 (CA)

Judge:Oland, Farrar and Bryson, JJ.A.
Court:Nova Scotia Court of Appeal
Case Date:February 10, 2015
Jurisdiction:Nova Scotia
Citations:(2015), 360 N.S.R.(2d) 65 (CA);2015 NSCA 49
 
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Jeffrie v. Hendriksen (2015), 360 N.S.R.(2d) 65 (CA);

    1135 A.P.R. 65

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Temp. Cite: [2015] N.S.R.(2d) TBEd. MY.031

Roderick Jeffrie (appellant) v. Anthony Hendriksen, Inland Marine Services Limited and Three Ports Fisheries Limited (respondents)

(CA 414372; 2015 NSCA 49)

Indexed As: Jeffrie v. Hendriksen et al.

Nova Scotia Court of Appeal

Oland, Farrar and Bryson, JJ.A.

May 20, 2015.

Summary:

Shareholders in a company had a falling out. They had multiple meetings to discuss the purchase of the plaintiff's shares. The parties reached a verbal agreement, but the transaction was not completed. The plaintiff sued for enforcement of the agreement. In the alternative, the plaintiff alleged oppressive conduct by Hendriksen.

The Nova Scotia Supreme Court, in a decision reported at (2013), 327 N.S.R.(2d) 218; 1036 A.P.R. 218, dismissed the action. The defendants sought solicitor and client costs or alternatively, a significant lump sum.

The Nova Scotia Supreme Court, in a decision reported at (2013), 330 N.S.R.(2d) 200; 1046 A.P.R. 200, determined the costs issues. The plaintiff appealed.

The Nova Scotia Court of Appeal allowed the appeal and remitted this matter to the application judge to determine whether specific performance or an assessment of damages would be the appropriate remedy. The cost award was set aside. The court left the assessment of costs of the original application and the costs of the assessment of remedy to the application judge.

Company Law - Topic 9781

Actions against corporations and directors - Action for oppressive conduct - When available (incl. time for) - Shareholders in a company had a falling out - They had multiple meetings to discuss the purchase of the plaintiff's shares - The parties reached a verbal agreement, but the transaction was not completed - The plaintiff sued for enforcement of the agreement - In the alternative, the plaintiff alleged oppressive conduct by the respondent - The application judge dismissed the action - The litigation was initiated by the plaintiff in order to extricate himself from his business relationship with the respondent in Three Ports and to receive compensation for his interest - The examples raised by the plaintiff in support of the alleged oppression were not matters which appeared to have concerned him prior to late 2010 or early 2011 - In fact, his evidence was that as of June 2010 he withdrew from any involvement in Three Ports - He did not seek financial information or answers to any questions or concerns which he had - He pursued a sale transaction with the respondent as his exit strategy - When that failed, he looked for any argument which might assist him in achieving his goal, and that included allegations of oppression - The court was not satisfied that he had met the burden of showing any conduct on the part of the respondent which would amount to oppression or unfair treatment of him - He had not satisfied the court that he had suffered any significant harm as a result of anything done by the respondent as officer, director or shareholder of Three Ports - Even if the court were to conclude that there had been oppression, it would not grant the remedy requested by the plaintiff - The court should only intervene to the extent needed to rectify the oppression and nothing more - The plaintiff's concerns with respect to corporate management and accounting information would not justify requiring the respondent to purchase his interest in the company, nor to wind it up - The Nova Scotia Court of Appeal held that the application judge was right to decline oppression relief to the plaintiff - As a general principle, the court would not give a litigant relief under the Companies Act which the litigant had the means of pursuing corporately himself - See paragraphs 60 to 65.

Contracts - Topic 1104

Formation of contract - General principles - Oral contracts - Shareholders in a company had a falling out - They had multiple meetings to discuss the purchase of the plaintiff's shares - The parties reached a verbal agreement, but the transaction was not completed - The plaintiff sued for enforcement of the agreement - The application judge dismissed the action - The plaintiff decided that he no longer wanted to be associated with the respondent and he took the reasonable approach of trying to negotiate a buyout of his shares - These discussions spanned several months but never resulted in a final and binding agreement - Despite the consensus on many of the key issues, the court concluded that legal obligations were intended to be conditional on a written agreement being signed, which never occurred - The Nova Scotia Court of Appeal allowed the plaintiff's appeal - "The application judge erred in law by bi-furcating the 'reasonable bystander' test to the facts before him. The fundamental task he was faced with was determining whether or not an agreement had been reached. Having found that such an agreement had been reached on September 16, it was an error to then super-add the requirement of writing to the question of whether a binding agreement had been reached. That exercise should have been implied in his original finding. One can only conclude the application judge found that an agreement had been reached on September 16 based on the conduct of the parties, objectively viewed, and then - using the same test - found that there was not really any binding agreement because it was supposed to be in writing. Alternately, based on the facts found by the application judge, a written agreement was not essential to the formation of a binding agreement between the parties." - See paragraphs 6 to 59.

Cases Noticed:

Creston Moly Corp. v. Sattva Capital Corp., [2014] 2 S.C.R. 633; 461 N.R. 335; 2014 SCC 53, refd to. [para. 6].

United Gulf Developments Ltd. et al. v. Iskandar et al. (2008), 267 N.S.R.(2d) 318; 853 A.P.R. 318; 2008 NSCA 71, refd to. [para. 17].

Trajkovich v. Ontario (Minister of Natural Resources) et al. (2009), 256 O.A.C. 322; 2009 ONCA 898, refd to. [para. 25].

Mountain v. Mountain Estate (2012), 299 O.A.C. 66; 2012 ONCA 806, refd to. [para. 30].

Bawitko Investments Ltd. v. Kernels Popcorn Ltd. (1991), 53 O.A.C. 314 (C.A.), refd to. [para. 37].

Mitsui & Co. (Point Aconi) Ltd. v. Jones Power Co. et al. (2000), 189 N.S.R.(2d) 1; 590 A.P.R. 1; 2000 NSCA 95, leave to appeal refused (2001), 270 N.R. 196; 193 N.S.R.(2d) 400; 602 A.P.R. 400 (S.C.C.), refd to. [para. 40].

UBS Securities Canada Inc. v. Sands Brothers Canada Ltd. (2009), 248 O.A.C. 146; 2009 ONCA 328, refd to. [para. 43].

Aegon Capital Management Inc. et al. v. BCE Inc. et al. (2008), 383 N.R. 119; 2008 SCC 69, refd to. [para. 64].

Authors and Works Noticed:

Fridman, Gerald Henry Louis, The Law of Contract in Canada (5th Ed. 2006), p. 15 [para. 19].

Counsel:

Roderick Jeffrie, appellant in person;

Ezra B. Van Gelder, for the respondents.

This appeal was heard at Halifax, N.S., on February 10, 2015, by Oland, Farrar and Bryson, JJ.A., of the Nova Scotia Court of Appeal. The following judgment of the Court of Appeal was delivered by Bryson, J.A., on May 20, 2015.

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