Lake Manitoba Estates Ltd. v. Communities Economic Development Fund, (1990) 66 Man.R.(2d) 58 (CA)

• Judge: O'Sullivan, Philp and Twaddle, JJ.A.
• Court: Court of Appeal (Manitoba)
• Case Date: April 03, 1990
• Jurisdiction: Manitoba
• Citations: (1990), 66 Man.R.(2d) 58 (CA)

Lake Man. Estates v. Com. Economic Dev. (1990), 66 Man.R.(2d) 58 (CA)

MLB headnote and full text

Lake Manitoba Estates Ltd. (plaintiff/appellant) v. Communities Economic Development Fund (defendant/respondent)

(457/89)

Indexed As: Lake Manitoba Estates Ltd. v. Communities Economic Development Fund

Manitoba Court of Appeal

O'Sullivan, Philp and Twaddle, JJ.A.

April 3, 1990.

Summary:

Dumont had a right of first refusal on a lot of land suitable for resort development. He was involved in a community resort development project and was willing to commit the land to the project, if he acquired it. When he had to exercise his right of first refusal, the plaintiff then went to the Communities Economic Development Fund for the funds. To prevent the land from falling into foreign hands the Fund provided the funds for its purchase, but took the property in its own name with the intention of later conveying it to the community project, if it went ahead. Dumont understood, if the project did not go ahead, he would be able to obtain a deed to the land. The community project did not proceed but the Fund refused to convey the property to Dumont. He and his assignee, Lake Manitoba Estates, brought an action against the Fund for a transfer of the land.

The Manitoba Court of Queen's Bench, in a judgment unreported in this series of reports, dismissed the plaintiffs' action. The plaintiffs appealed.

The Manitoba Court of Appeal, in a judgment reported 2 Man.R.(2d) 295, allowed the appeal and the plaintiffs' action. The Court of Appeal held that the Fund held the land under a constructive trust for Dumont, where the Fund was unjustly enriched at the expense of Dumont.

Subsequently, Lake Manitoba Estates brought another action against the Fund for damages resulting from the refusal to convey. The Fund applied to have the statement of claim struck out on the ground of res judicata. A referee refused the application. The Fund appealed.

The Manitoba Court of Queen's Bench, in a judgment reported 27 Man.R.(2d) 118, dismissed the appeal and ordered that the action proceed to trial. The Fund appealed.

The Manitoba Court of Appeal, in a judgment reported 28 Man.R.(2d) 219, dismissed the appeal and affirmed that the matter should proceed to trial.

The Manitoba Court of Queen's Bench, in a judgment reported 61 Man.R.(2d) 173, allowed the action for damages, but refused to include exemplary damages. The court held that the action for damages was not barred on the ground of res judicata, because there was no basis for a claim for damages earlier. Lake Manitoba Estates appealed the assessment of damages.

The Manitoba Court of Appeal dismissed the appeal.

Damages - Topic 1309

Exemplary or punitive damages - Breach of trust - A government agency was found to have held land upon a constructive trust for a specific public purpose and to have wrongfully refused to convey the land to the cetui que trust when the purpose fell through - The agency refused to convey on the ground that the land was still to be used for public purposes - The Manitoba Court of Queen's Bench refused to award exemplary or punitive damages against the agency - The Manitoba Court of Appeal affirmed the assessment of damages.

Damages - Topic 4008

Interference with economic relations - Breach of fiduciary relationship - Breach of trust - General - The defendant wrongfully refused to convey land to the plaintiff - The land was planned for development for recreational lots and the development was delayed for several years by the defendant's refusal - The Manitoba Court of Queen's Bench allowed the plaintiff's action for damages caused by the delay in the amount of $75,000, an amount determined by consideration of the value of the land during the time it was wrongfully withheld and made up mostly of increased costs of development at the later date - The Manitoba Court of Appeal affirmed the assessment of damages.

Damages - Topic 4388

Torts affecting land and buildings - Occupation and use - Dispossession - [See Damages - Topic 4008 ].

Counsel:

J.S. Lamont, Q.C., and C.E. Carlson, for the appellant;

J.A. MacDonald and D.G. Murray, for the respondent.

This appeal was heard on April 3, 1990, before O'Sullivan, Philp and Twaddle, JJ.A., of the Manitoba Court of Appeal.

On April 3, 1990, Twaddle, J.A., delivered the following judgment orally for the Court of Appeal: