Motkoski Holdings Ltd. v. Yellowhead (County), (2008) 452 A.R. 59 (QB)

• Jurisdiction: Alberta
• Court: Court of Queen's Bench of Alberta (Canada)
• Judge: Smith, J.
• Citation: (2008), 452 A.R. 59 (QB),2008 ABQB 780
• Date: 03 December 2008

Motkoski Holdings Ltd. v. Yellowhead (2008), 452 A.R. 59 (QB)

MLB headnote and full text

Temp. Cite: [2009] A.R. TBEd. JA.045

Motkoski Holdings Ltd. (plaintiff) v. Yellowhead County (defendant)

(0303-12682; 2008 ABQB 780)

Indexed As: Motkoski Holdings Ltd. v. Yellowhead (County)

Alberta Court of Queen's Bench

Judicial District of Edmonton

Smith, J.

December 19, 2008.

Summary:

The plaintiff negotiated the purchase of land from the defendant county for a motel development. The county knew that the lands could be "nuisance lands" because it was a possible former landfill site. A report commissioned by the county recommended further investigation and disclosure to any purchaser. The county did not investigate and did not disclose this information to the plaintiff. Information in the county's possession confirmed the landfill. Soil testing undertaken by the plaintiff indicated the existence of waste which could only be removed with great expense. The plaintiff, unable to proceed with its development unless the waste was removed from its lands and adjacent lands owned by the county, sued the county for damages. The county pleaded caveat emptor based on the "sale as is" provisions of the purchase and sale agreement.

The Alberta Court of Queen's Bench, in a judgment reported (2008) 452 A.R. 31, found the county liable for fraudulent misrepresentation (deceit) or, alternatively, for concealment of a latent defect. Both were exceptions relieving the plaintiff from the application of the caveat emptor doctrine. The court assessed $885,854 damages for actual loss ($185,854 out-of-pocket expenses) and consequential loss (lost opportunity to earn $700,000 profits over for two years). The plaintiff applied for formal judgment and costs on a solicitor-client or multiple column 4 basis. The county sought a stay of the judgment.

The Alberta Court of Queen's Bench determined the content of the formal judgment and awarded the plaintiff costs at double Column 4, including second counsel fees, expert fees and costs of exhibit books. The court stayed the judgment for one year or until there was a decision on appeal, whichever was sooner, subject to conditions.

Practice - Topic 5418

Judgments and orders - General - Drawing orders and judgments - The plaintiff was awarded damages for the defendant's fraudulent misrepresentation respecting the sale of land - The plaintiff requested that the formal judgment note the court's finding of fraudulent misrepresentation - The Alberta Court of Queen's Bench stated that "the finding of fraudulent misrepresentation does not confer relief upon the plaintiff. It is a legal conclusion made as part of the reasoning which led to the result which is the money judgment. Therefore, the formal judgment shall not reflect the reasons which include a finding of fraudulent misrepresentation." - See paragraphs 3 to 6.

Practice - Topic 5854

Judgments and orders - Enforcement of judgments - Stay of - The plaintiff negotiated the purchase of land from the defendant county for a motel development - The county knew that the lands could be "nuisance lands" because it was a possible former landfill site - A report commissioned by the county recommended further investigation and disclosure to any purchaser - The county did not investigate and did not disclose this information to the plaintiff - Information in the county's possession confirmed the landfill - Soil testing undertaken by the plaintiff indicated the existence of waste which could only be removed with great expense - The plaintiff, unable to proceed with its development unless the waste was removed from its lands and adjacent lands owned by the county, sued the county for damages - The county pleaded caveat emptor based on the "sale as is" provisions of the purchase and sale agreement - The county was liable for fraudulent misrepresentation (deceit) or, alternatively, for concealment of a latent defect - Both were exceptions relieving the plaintiff from the application of the caveat emptor doctrine - The county deliberately concealed information, with an intention to deceive the plaintiff - Had this information been disclosed, the plaintiff would not have purchased the land, but would have pursued another business venture - The court assessed $885,854 damages - The Alberta Court of Queen's Bench allowed the county's application to stay the judgment for one year or pending an appeal decision, whichever was sooner, subject to conditions - There was a danger that if the appeal succeeded, the plaintiff would be unable to repay the judgment, which constituted irreparable harm - The balance of convenience favoured a stay - See paragraphs 28 to 38.

Practice - Topic 7110.1

Costs - Party and party costs - Special orders - Increase in scale of costs - Conduct of opposite party - The plaintiff negotiated the purchase of land from the defendant county for a motel development - The county knew that the lands could be "nuisance lands" because it was a possible former landfill site - A report commissioned by the county recommended further investigation and disclosure to any purchaser - The county did not investigate and did not disclose this information to the plaintiff - Information in the county's possession confirmed the landfill - Soil testing undertaken by the plaintiff indicated the existence of waste which could only be removed with great expense - The plaintiff, unable to proceed with its development unless the waste was removed from its lands and adjacent lands owned by the county, sued the county for damages - The county pleaded caveat emptor based on the "sale as is" provisions of the purchase and sale agreement - The county was liable for fraudulent misrepresentation (deceit) or, alternatively, for concealment of a latent defect - Both were exceptions relieving the plaintiff from the application of the caveat emptor doctrine - The county deliberately concealed information, with an intention to deceive the plaintiff - Had this information been disclosed, the plaintiff would not have purchased the land, but would have pursued another business venture - The court assessed $885,854 damages - The Alberta Court of Queen's Bench declined to award solicitor-client costs on the basis of the fraudulent misrepresentation, because the fraud was pre-litigation and there was no objectionable conduct by the defendant relating to the litigation itself and the litigation was not unjustly defended - However, the county's conduct did warrant increased costs, which were to be taxed at double Column 4 - See paragraphs 7 to 27.

Practice - Topic 7454

Costs - Solicitor and client costs - Entitlement to solicitor and client costs - Improper, irresponsible or unconscionable conduct - [See Practice - Topic 7110.1 ].

Practice - Topic 8954

Appeals - Stay of proceedings pending appeal - What constitutes "irreparable harm" - [See Practice - Topic 5854 ].

Cases Noticed:

Collavino Inc. v. Tihama Development Authority (TDA) an Organ of the Republic of Yemen (2007), 444 A.R. 1; 91 Alta. L.R.(4th) 378; 2007 ABQB 497, refd to. [para. 5].

Friends of the Oldman River Society v. Canada (Minister of Transport and Minister of Fisheries and Oceans), [1992] 1 S.C.R. 3; 132 N.R. 321; 88 D.L.R.(4th) 1, refd to. [para. 10].

Young v. Young et al., [1993] 4 S.C.R. 3; 160 N.R. 1; 34 B.C.A.C. 161; 56 W.A.C. 161; 108 D.L.R.(4th) 193, refd to. [para. 11].

K.C. v. College of Physical Therapists (Alta.) (1999), 244 A.R. 28; 209 W.A.C. 28; 1999 ABCA 253, refd to. [para. 12].

Walsh v. Mobil Oil Canada et al. (2008), 440 A.R. 199; 438 W.A.C. 199; 296 D.L.R.(4th) 178; 2008 ABCA 268, refd to. [para. 13].

Jackson and Parkview Holdings Ltd. v. Trimac Industries Ltd. et al. (1993), 138 A.R. 161; 8 Alta L.R.(3d) 403 (Q.B.), refd to. [para. 13].

Sidorsky et al. v. CFCN Communications Ltd. et al. (1997), 206 A.R. 382; 156 W.A.C. 382; 53 Alta. L.R.(3d) 255 (C.A.), refd to. [para. 13].

Strathcona (County) v. Half Moon Lake Resort Ltd. et al. (2001), 281 A.R. 103; 248 W.A.C. 103; 197 D.L.R.(4th) 70; 2001 ABCA 50, refd to. [para. 13].

Ramrakha et al. v. Zinner et al. (1994), 157 A.R. 279; 77 W.A.C. 279; 24 Alta. L.R.(3d) 240 (C.A.), refd to. [para. 13].

Steeves v. English, [2004] A.R. Uned. 94; 6 R.F.L.(6th) 125; 2004 ABCA 195, refd to. [para. 13].

Performance Industries Ltd. v. Hancock et al., [2007] A.R. Uned. 890; 155 A.C.W.S.(3d) 1041; 2007 ABCA 6, refd to. [para. 13].

Baker v. Canada (Minister of Citizenship and Immigration), [1999] 2 S.C.R. 817; 243 N.R. 22; 174 D.L.R.(4th) 193, refd to. [para. 15].

RJR-MacDonald Inc. et Imperial Tobacco Ltd. v. Canada (Procureur général), [1994] 1 S.C.R. 311; 164 N.R. 1; 60 Q.A.C. 241; 111 D.L.R.(4th) 385, refd to. [para. 28].

Edmonton (City) v. Westinghouse Canada Inc. et al. (1996), 187 A.R. 153; 127 W.A.C. 153; 42 Alta. L.R.(3d) 356 (C.A.), refd to. [para. 28].

Counsel:

Rod J. Wasylyshyn and Lara M. Levesque (Ogilvie LLP), for the plaintiff;

Anthony W. Slemko and Duncan Purvis (Parlee McLaws LLP), for the defendant.

This matter was heard on December 3, 2008, before Smith, J., of the Alberta Court of Queen's Bench, Judicial District of Edmonton, who delivered the following judgment on December 19, 2008.