JKC Enterprises Ltd. et al. v. Woolworth Canada Inc. et al., 2001 ABQB 791

• Judge: Coutu, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: May 22, 2001
• Citations: 2001 ABQB 791;(2001), 300 A.R. 1 (QB)

JKC Ent. Ltd. v. Woolworth Can. Inc. (2001), 300 A.R. 1 (QB)

MLB headnote and full text

Temp. Cite: [2001] A.R. TBEd. OC.086

JKC Enterprises Ltd., Kenneth Franke and Jacqueline Franke (plaintiffs) v. Woolworth Canada Inc. and Wal-Mart Canada Inc. (defendants)

(Action No. 9401-14862; 2001 ABQB 791)

Indexed As: JKC Enterprises Ltd. et al. v. Woolworth Canada Inc. et al.

Alberta Court of Queen's Bench

Judicial District of Calgary

Coutu, J.

September 8, 2001.

Summary:

For 16 years, JKC Enterprises Inc. provided trucking services exclusively to the defendants (Woolco). Woolco, without prior notice to JKC, ceased using its services. JKC soon ceased operations. JKC asserted its relationship with Woolco was of the "intermediate" type, and was akin to an employment relationship which could only be terminated upon reasonable notice. JKC sued for damages for breach of contract and failure to give reasonable notice.

The Alberta Court of Queen's Bench allowed the action.

Contracts - Topic 4701

Discharge and termination - By notice - General - For 16 years, JKC Enterprises Inc. provided trucking services exclusively to the defendants (Woolco) - Woolco, without prior notice to JKC, ceased using its services - JKC soon ceased operations - JKC sued for damages for breach of contract and failure to give reasonable notice - JKC asserted its relationship with Woolco was of the "intermediate" type, and was akin to an employment relationship which could only be terminated upon reasonable notice - Woolco argued JKC was an independent contractor - The Alberta Court of Queen's Bench allowed the action - The relationship between the parties was a longstanding close one in which each placed complete reliance on each other - JKC was economically dependent on the revenue it earned from Woolco - JKC was not an independent contractor and it was entitled to reasonable notice of termination - See paragraphs 83 to 92.

Contracts - Topic 4704

Discharge and termination - By notice - What constitutes notice of termination - For 16 years, JKC Enterprises Inc. provided trucking services exclusively to a number of Woolco stores - When Wal-Mart purchased the Woolco stores, it ceased using JKC's services - JKC soon ceased operations - JKC sued for damages for breach of contract and failure to give reasonable notice - JKC asserted its relationship with Woolco was of the "intermediate" type, and was akin to an employment relationship which could only be terminated upon reasonable notice - Woolco argued that when JKC was invited to bid on the "new" contract for part of the work it had been doing that this was reasonable notice - The Alberta Court of Queen's Bench rejected this argument and allowed the action - See paragraph 121.

Contracts - Topic 4706

Discharge and termination - By notice - What constitutes reasonable notice - For 16 years, JKC Enterprises Inc. provided trucking services exclusively to the defendants (Woolco) - Woolco, without prior notice to JKC, ceased using its services - JKC soon ceased operations - JKC sued for damages for breach of contract and failure to give reasonable notice - The Alberta Court of Queen's Bench allowed the action - The relationship between the parties was a longstanding close one in which each placed complete reliance on each other - JKC was economically dependent on the revenue it earned from Woolco - JKC was not an independent contractor and it was entitled to reasonable notice of termination, which in the circumstances of this case was nine months - See paragraphs 93 to 120.

Damages - Topic 6741

Contracts - Employment relationship or contract - For breach by employer - General - For 16 years, JKC Enterprises Inc. provided trucking services exclusively to the defendants (Woolco) - Woolco, without prior notice to JKC, ceased using its services - JKC soon ceased operations - JKC sued, arguing that its damages were what the shareholders would have earned from the contract during a reasonable notice period prior to termination - Woolco argued that JKC, as a company, was the plaintiff and since it had always posted annual losses it could not prove any damages arising from the termination - The Alberta Court of Queen's Bench held that JKC's damages were the difference between what it actually paid its shareholders during the notice period and what it would have paid them had the contract continued - The court rejected a further argument that the average income of the shareholders over the last three years should be the figure used - The contract had expanded during this time and there was no reason it would not have continued in its final form - See paragraphs 123 to 142.

Damages - Topic 7070

Contracts - Contracts for services - Breach - Wrongful dismissal - [See Damages - Topic 6741 ].

Master and Servant - Topic 303

Nature of relationship - What constitutes an employer-employee relationship - [See Contracts - Topic 4701 ].

Master and Servant - Topic 1023

Contract of hiring (employment contract) - Parties - Employee - What constitutes - [See Contracts - Topic 4701 ].

Master and Servant - Topic 1230

Contract of hiring (employment contract) -Termination - Notice of termination - By employer - [See Contracts - Topic 4701 ].

Master and Servant - Topic 7504

Dismissal of employees - Nature and rights of employment - [See Contracts - Topic 4701 ].

Master and Servant - Topic 7998

Dismissal without cause - Notice of dismissal - When required - [See Contracts - Topic 4701 ].

Master and Servant - Topic 8000

Dismissal without cause - Notice of dismissal - What constitutes reasonable notice - [See Contracts - Topic 4706 ].

Cases Noticed:

Carter v. Bell & Sons, [1936] 2 D.L.R. 438 (Ont. C.A.), refd to. [para. 54].

Martin-Baker Aircraft Co. v. Canadian Flight Equipment, [1955] 2 Q.B. 556; 2 All E.R. 722, refd to. [para. 58].

Marbry et al. v. Avrecan International Inc. (1999), 119 B.C.A.C. 266; 194 W.A.C. 266 (C.A.), refd to. [para. 61].

Hillis Oil and Sales Ltd. v. Wynn's Canada Ltd., [1986] 1 S.C.R. 57; 65 N.R. 23; 71 N.S.R.(2d) 353; 171 A.P.R. 353; 25 D.L.R.(4th) 649, refd to. [para. 64].

Paper Sales Corp. v. Miller Brothers Co. (1962) Ltd. (1975), 7 O.R.(2d) 460, affd. (1975), 7 O.R. 460; 55 D.L.R.(3d) 492 (C.A.), refd to. [para. 65].

Mancino v. Nelson Aggregate Co., [1994] O.J. No. 1559 (Ct. J.), refd to. [para. 67].

Erb and Farris v. Expert Delivery Ltd. (1995), 167 N.B.R.(2d) 113; 427 A.P.R. 113; 14 C.C.E.L.(2d) 155 (T.D.), refd to. [para. 71].

Jackson v. Francis (Norman W.) Ltd., [1999] N.B.R.(2d) (Supp.) No. 4 (Q.B.), refd to. [para. 72].

Stephenson (Wayne) Sales Agencies Inc. v. Avercan International Inc. (1996), 11 O.T.C. 327 (Gen. Div.), refd to. [para. 72].

Western Equipment Ltd. v. Chesterton (A.W.) Co., [1982] B.C.W.L.D. 1211; [1982] B.C.J. No. 395 (S.C.), additional reasons (1983), 46 B.C.L.R. 64 (S.C.), refd to. [para. 74].

Henley v. Peeters Textile Mills Ltd. (1979), 1 A.C.W.S. 319 (Ont. H.C.J.), refd to. [para. 74].

Toronto Type Foundry Ltd. v. Miehle-Goss-Dexter Inc. (1969), 2 O.R. 431 (H.C.J.), refd to. [para. 74].

Boettcher v. Stremecki and Norlite Pharmacy (1969) Ltd. (1980), 25 A.R. 372 (Q.B.), refd to. [para. 74].

MacPhail v. Tackama Forest Products Ltd. (1993), 86 B.C.L.R.(2d) 218 (S.C.), refd to. [para. 75].

Bird v. Warnock Hersey Professional Services Ltd. (1980), 25 B.C.L.R. 95 (S.C.), refd to. [para. 75].

Lefebvre v. HOJ Industries Ltd.; Machtinger HOJ Industries Ltd., [1992] 1 S.C.R. 986; 136 N.R. 40; 53 O.A.C. 200; 91 D.L.R.(4th) 491; 40 C.C.E.L. 1, refd to. [para. 76].

Smith v. Undercoverwear Ltd. (1993), 42 A.C.W.S.(3d) 841 (Ont. Gen. Div.), refd to. [para. 79].

Clarke, Irwin & Co. v. Harrap (George C.) & Co. (1980), 9 B.L.R. 97 (Ont. S.C.), refd to. [para. 80].

Yamaha Canada Music Ltd. v. MacDonald and Oryall Ltd., [1990] 46 B.C.L.R.(2d) 363 (C.A.), refd to. [para. 80].

Stephenson (Wayne) Sales Agencies Inc. v. Avrecan International Inc. (1996), 11 O.T.C. 327 (Gen. Div.), refd to. [para. 80].

National Bowling & Billiards (1961), 27 D.L.R.(2d) 342, refd to. [para. 80].

Bardal v. The Globe and Mail Ltd. (1960), 24 D.L.R.(2d) 140 (Ont. H.C.), folld. [para. 95].

Lazarowicz v. Orenda Engines Ltd., [1961] O.R. 141 (C.A.), not folld. [para. 96].

Wiebe v. Central Transport Refrigeration (Man.) Ltd. (1994), 95 Man.R.(2d) 65; 70 W.A.C. 65 (C.A.), refd to. [para. 109].

Slater v. Sandwell, [1994] O.J. 1317, refd to. [para. 109].

Jackson v. Norman Francis Ltd., [1997] N.B.J. No. 147, refd to. [para. 116].

Big Sweeper Building Maintenance Ltd. v. Canadian Forest Products Ltd. (1991), 2 B.C.A.C. 36; 5 W.A.C. 36; 57 B.C.L.R.(2d) 56 (C.A.), refd to. [para. 140].

Authors and Works Noticed:

Canadian Encyclopaedic Digest (Western ) (3rd Ed. 1998), pp. 140-145 [para. 73].

Fudge, Judy, New Wine into Old Bottles? Updating Legal Forms to Reflect Changing Employment Norms, (1999), 33 U.B.C.L. Rev., 129 to 152 [para. 81].

Harris, David, Wrongful Dismissal (1989 Looseleaf Ed.), pp. 2-2, 2-7, 2-10 [para. 76]; 4-7 to 4-12.2 [para. 110].

Counsel:

Larry Heald, for the plaintiffs;

M. Burns, for the defendants.

This action was heard on May 22, 2001, by Coutu, J., of the Alberta Court of Queen's Bench, Judicial District of Calgary, who delivered the following decision on September 8, 2001.