Potash Corp. of Saskatchewan Inc. v. Mosaic Potash Esterhazy Limited Partnership, 2011 SKQB 283

• Judge: Gabrielson, J.
• Court: Court of Queen's Bench of Saskatchewan (Canada)
• Case Date: July 15, 2011
• Jurisdiction: Saskatchewan
• Citations: 2011 SKQB 283;(2011), 381 Sask.R. 1 (QB)

Potash Corp. v. Mosaic Potash (2011), 381 Sask.R. 1 (QB)

MLB headnote and full text

Temp. Cite: [2011] Sask.R. TBEd. AU.016

Potash Corporation of Saskatchewan Inc. (plaintiff/defendant by counterclaim/applicant) v. Mosaic Potash Esterhazy Limited Partnership (defendant/plaintiff by counterclaim/respondent)

(2009 Q.B.G. No. 666; 2011 SKQB 283)

Indexed As: Potash Corp. of Saskatchewan Inc. v. Mosaic Potash Esterhazy Limited Partnership

Saskatchewan Court of Queen's Bench

Judicial Centre of Saskatoon

Gabrielson, J.

July 15, 2011.

Summary:

Mosaic owned and operated the Esterhazy potash mine. PCS owned potash reserves around the mine. Mosaic mined the PCS reserves under a mining agreement. A dispute arose regarding the agreement's termination. PCS sued Mosaic, seeking, inter alia, a declaration as to the amount of potash that remained to be delivered. PCS applied for an interlocutory injunction restraining Mosaic from altering the status quo by ceasing to deliver potash in accordance with the terms of the mining agreement.

The Saskatchewan Court of Queen's Bench allowed the application.

Injunctions - Topic 1606

Interlocutory or interim injunctions - General principles - Balance of convenience - Mosaic owned and operated the Esterhazy potash mine - PCS owned potash reserves around the mine - Mosaic mined the PCS reserves under a mining agreement - A dispute arose regarding the agreement's termination - PCS sued Mosaic, seeking, inter alia, a declaration as to the amount of potash that remained to be delivered - PCS applied for an interlocutory injunction restraining Mosaic from altering the status quo by ceasing to deliver potash in accordance with the terms of the mining agreement - The Saskatchewan Court of Queen's Bench allowed the application - The balance of convenience strongly favoured granting the injunction - There was no suggestion that Mosaic would suffer any irreparable harm - If Mosaic was successful at trial, its damages were quantifiable - PCS had filed an undertaking to pay damages and had the ability to pay - An interlocutory injunction would preserve the status quo - See paragraphs 41 to 43.

Injunctions - Topic 1607

Interlocutory or interim injunctions - General principles - Requirement of strong prima facie case or appearance of right - Mosaic owned and operated the Esterhazy potash mine - PCS owned potash reserves around the mine - Mosaic mined the PCS reserves under a mining agreement - A dispute arose regarding the agreement's termination - PCS sued Mosaic, seeking, inter alia, a declaration as to the amount of potash that remained to be delivered - PCS applied for an interlocutory injunction restraining Mosaic from altering the status quo by ceasing to deliver potash in accordance with the terms of the mining agreement - The Saskatchewan Court of Queen's Bench allowed the application - The court disagreed with Mosaic's position that PCS was seeking a mandatory injunction such that PCS had to establish a strong prima facie case - The order sought was one prohibiting Mosaic from ceasing deliveries, which was more like a prohibitory injunction - PCS had to establish a serious issue to be tried, which was an issue that was neither frivolous nor vexatious - There was a valid dispute between the parties - Billions of dollars were at issue - It was impossible to determine the merits of each side's position based on the affidavit evidence - There was a serious issue to be tried - See paragraphs 11 to 26.

Injunctions - Topic 1616

Interlocutory or interim injunctions - General principles - Arguable issues of law involved or serious question to be tried - [See Injunctions - Topic 1607 ].

Injunctions - Topic 1779.9

Interlocutory or interim injunctions - Preservation of status quo - Pending outcome of action - [See Injunctions - Topic 1606 ].

Injunctions - Topic 1802

Interlocutory or interim injunctions - Requirement of irreparable injury - What constitutes - Mosaic owned and operated the Esterhazy potash mine - PCS owned potash reserves around the mine - Mosaic mined the PCS reserves under a mining agreement - A dispute arose regarding the agreement's termination - PCS sued Mosaic, seeking, inter alia, a declaration as to the amount of potash that remained to be delivered - PCS applied for an interlocutory injunction restraining Mosaic from altering the status quo by ceasing to deliver potash in accordance with the terms of the mining agreement - The Saskatchewan Court of Queen's Bench allowed the application - The evidence filed by PCS had established "more than a mere possibility of irreparable harm" - If PCS was unable to meet its commitments for delivery of potash products to its customers, it would be impossible to calculate in monetary terms how its reputation was affected or what future sales had been lost - The effect on its market share for succeeding years would also be difficult, if not impossible, to quantify - Mosaic's proposal of three alternatives for continuing delivery of potash on terms different from the mining agreement was specious - A litigant seeking an interlocutory injunction did not have to accept an alteration to the terms of a contract that it was seeking to enforce in order to avoid the irreparable harm it would otherwise suffer - See paragraphs 27 to 40.

Injunctions - Topic 2304

Mandatory injunctions - Mandatory and restrictive injunctions distinguished - [See Injunctions - Topic 1607 ].

Cases Noticed:

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, refd to. [para. 9].

First Choice Capital Fund Ltd. v. First Canadian Capital Corp. - see Aquino et al. v. First Choice Capital Fund Ltd. et al.

Aquino et al. v. First Choice Capital Fund Ltd. et al., [1997] 9 W.W.R. 177; 157 Sask.R. 253 (Q.B.), refd to. [para. 9].

Carlson v. Carlson Holdings Ltd. et al. (2005), 264 Sask.R. 282; 2005 SKQB 189, dist. [para. 10].

Townsend v. Canada (Attorney General) (2011), 389 F.T.R. 77; 2011 FC 512, refd to. [para. 10].

University of Regina Faculty Association et al. v. University of Regina et al. (1999), 182 Sask.R. 85 (Q.B.), refd to. [para. 10].

Centre Ice Ltd. v. National Hockey League et al. (1994), 166 N.R. 44; 53 C.P.R.(3d) 34 (F.C.A.), refd to. [para. 10].

La Plante et al. v. Society for the Prevention of Cruelty to Animals (Sask.) (2011), 371 Sask.R. 123; 518 W.A.C. 123; 2011 SKCA 43, folld. [para. 13].

Island View (Resort Village) v. Romashenko (2010), 346 Sask.R. 126; 477 W.A.C. 126; 2010 SKCA 4, refd to. [para. 13].

Baynton v. Mills et al. (2008), 313 Sask.R. 266; 2008 SKQB 108, refd to. [para. 13].

Carbert v. Farm Credit Corp., [1993] 3 W.W.R. 198; 106 Sask.R. 123 (Q.B.), refd to. [para. 15].

Apotex Fermentation Inc. et al. v. Novopharm Ltd. et al., [1994] 7 W.W.R. 420; 95 Man.R.(2d) 241; 70 W.A.C. 241 (C.A.), refd to. [para. 16].

Rogers Cable TV Ltd. v. 373041 Ontario Ltd., [1994] O.J. No. 844 (C.J.), refd to. [para. 16].

Grey v. Edmonton (City) (2005), 377 A.R. 350; 2005 ABQB 231, refd to. [para. 16].

D.M. et al. v. Board of Education of Regina Roman Catholic Separate Division No. 81 (1994), 128 Sask.R. 206; 85 W.A.C. 206 (C.A.), dist. [para. 17].

Barton-Reid Canada Ltd. v. Alfresh Beverages Canada Corp., [2002] O.T.C. 799 (Sup. Ct.), dist. [para. 17].

TDL Group Ltd. v. 1060284 Ontario Ltd. et al. (2001), 150 O.A.C. 354 (Div. Ct.), refd to. [para. 18].

Erinwood Ford Sales Ltd. et al. v. Ford Motor Co. of Canada Ltd., [2005] O.T.C. Uned. 517; 6 B.L.R.(4th) 182 (Sup. Ct.), refd to. [para. 18].

674834 Ontario Ltd. v. Culligan of Canada Ltd. et al., [2007] O.T.C. Uned. 306; 28 B.L.R.(4th) (Sup. Ct.), refd to. [para. 18].

Look Communications Inc. v. Bell Canada, [2007] O.T.C. Uned. G40 (Sup. Ct.), refd to. [para. 18].

Shepherd Homes Ltd. v. Sandham, [1970] 3 W.L.R. 348, refd to. [para. 19].

Films Rover Ltd. v. Cannon Film Sales Ltd., [1987] 1 W.L.R. 670; [1986] 3 All E.R. 772 (Ch. Div.), refd to. [para. 20].

American Cyanamid Co. v. Ethicon Ltd., [1975] A.C. 396; [1975] 2 W.L.R. 316 (H.L.), refd to. [para. 20].

National Commercial Bank Jamaica Ltd. v. Olint Corp., [2009] N.R. Uned. 164; [2009] 1 W.L.R. 1405; [2009] UKPC 16, refd to. [para. 21].

Summerside Seafood Supreme Inc. v. Prince Edward Island (Minister of Fisheries, Aquaculture and Environment) et al. (2006), 256 Nfld. & P.E.I.R. 277; 773 A.P.R. 277; 271 D.L.R.(4th) 530 (P.E.I.C.A.), appld. [para. 22].

101109718 Saskatchewan Ltd. et al. v. Agrikalium Potash Corp. et al. (2011), 375 Sask.R. 136; 525 W.A.C. 136; 2011 SKCA 82, refd to. [para. 31].

RBC DS Financial Services Inc. v. Saskatchewan (Life Insurance Council) (1994), 31 C.P.C.(3d) 304 (Sask. Q.B.), refd to. [para. 37].

Arcas Group Inc. et al. v. Beaumont et al., [2009] Sask.R. Uned. 195; 81 C.P.C.(6th) 377; 2009 SKQB 419, refd to. [para. 37].

Stegg Ltd. et al. v. Moffatt et al., [2006] Sask.R. Uned. 15; 2006 SKQB 7, refd to. [para. 37].

Cybersurf Corp. v. Shaw Cablesystems G.P. (2009), 468 A.R. 240; 80 C.P.C.(6th) 382; 2009 ABQB 152, refd to. [para. 40].

Christie v. British Columbia (Attorney General) et al. (2006), 223 B.C.A.C. 253; 369 W.A.C. 253; 264 D.L.R.(4th) 468 (C.A.), refd to. [para. 40].

British Columbia (Attorney General) v. Wale et al., [1987] 2 W.W.R. 331 (B.C.C.A.), affd. [1991] 1 S.C.R. 62; 120 N.R. 208, refd to. [para. 42].

Edmonton Northlands v. Edmonton Oilers Hockey Corp. (1993), 147 A.R. 113; 23 C.P.C.(3d) 49 (Q.B.), refd to. [para. 42].

Authors and Works Noticed:

Sharpe, Robert J., Injunctions and Specific Performance (2010), pp. 2-59 to 2-60 [para. 14]; paras. 2.530 [para. 41]; 2.630 [para. 14].

Counsel:

Gordon J. Kuski, Q.C., Kent E. Thomson, Amanda M. Quayle and Maureen E. Armstrong, for the applicant;

Douglas C. Hodson, Q.C., and David R. Haigh, Q.C., for the respondent.

This application was heard by Gabrielson, J., of the Saskatchewan Court of Queen's Bench, Judicial Centre of Saskatoon, who delivered the following fiat on July 15, 2011.