Roenisch v. Sheep Creek Ranch Ltd. et al., (1993) 138 A.R. 15 (QB)

• Judge: Rawlins, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: March 04, 1993
• Citations: (1993), 138 A.R. 15 (QB)

Roenisch v. Sheep Creek Ranch Ltd. (1993), 138 A.R. 15 (QB)

MLB headnote and full text

Dr. Harold Roenisch (plaintiff) v. Annie Helen Bangs, also known as Heln Bangs, Milo Bangs and Sheep Creek Ranch Ltd. (defendants)

(Action No. 8801-12321)

Harold Roenisch, Jr. (plaintiff) v. Sheep Creek Ranch Ltd., R.D. Veterinary Centre Ltd., Harold W. Roenisch, Sr., Theresa Roenisch-Hurd and the Royal Trust Company (defendants)

(Action No. 8801-16387)

Indexed As: Roenisch v. Sheep Creek Ranch Ltd. et al.

Alberta Court of Queen's Bench

Judicial District of Calgary

Rawlins, J.

March 4, 1993.

Summar y:

Roenisch Sr. incorporated a family sheep farming corporation, Sheep Creek Ranch, as part of an estate freeze in 1966. This mech­anism allowed Roenisch Sr. to roll some of his property into the corporation. Subsequently Roenisch Sr. commenced an action against Sheep Creek Ranch to enforce a debenture securing Sheep Creek's indebt­edness to him. In response, his son, Roe­nisch Jr., sued to set aside the debenture and other agreements between his father and Sheep Creek Ranch, and alternatively, claimed a set off-for personal benefits received by Roenisch Sr. from Sheep Creek Ranch during the years 1966 to 1986.

The Alberta Court of Queen's Bench allowed both actions in part.

Contracts - Topic 1586

Formation of contracts - Consent - Duress - Defence of - When available - Roe­nisch Sr. obtained a debenture from a family owned farming operation to secure the company's indebtedness to him - When Roenisch Sr. subsequently sued to enforce the debenture, his son argued that the debenture was unenforce­able because of duress - The Alberta Court of Queen's Bench reviewed the test for economic duress and held that the son was not coerced to the extent that his con­sent to the deben­ture was vitiated - See para­graphs 45 to 52.

Equity - Topic 1122

Equitable relief - Contracts - Uncon­scionable bargain defined - Roenisch Sr. obtained a debenture from a family owned farming operation to secure the company's indebted­ness to him - When Roenisch Sr. subsequently sued to enforce the deben­ture, his son argued that the debenture and a loan agreement and a­greement and ac­knowledgment between the parties were unenforceable because of unconscionability - The Alberta Court of Queen's Bench reviewed when an agree­ment would be set aside for unconscionability - The court held that the debenture was valid; how­ever, the loan agreement and agreement and acknowledgment were unconscionable in their present form - The court, exercis­ing its equitable jurisdiction, made a dec­laration of the amount actually owing under the agreements - See para­graphs 45 to 52, 71 to 91.

Fraud and Misrepresentation - Topic 603

Undue influence - What constitutes - Roenisch Sr. obtained a debenture from a family owned farming operation to secure the company's indebtedness to him - When Roenisch Sr. subsequently sued to enforce the debenture, his son argued that the debenture was unenforce­able because of undue influence - The Alberta Court of Queen's Bench discussed the test for undue influence and rejected the son's argument - See paragraphs 53 to 61.

Cases Noticed:

Campbell v. Campbell (No. 2) (1990), 83 Nfld. & P.E.I.R. 340; 260 A.P.R. 340 (Nfld. S.C.), refd to. [para. 39].

Morrison v. Coast Finance (1965), 55 D.L.R.(2d) 710 (B.C.C.A.), refd to. [para. 41].

Dewolfe v. Mansour (1986), 73 N.S.R.(2d) 110; 176 A.P.R. 110 (S.C.T.D.), refd to. [para. 44].

Pao On et al. v. Lau Yiu et al., [1979] 3 All E.R. 65 (P.C.), refd to. [para. 45].

Gordon (In Trust) v. Roebuck (1992), 57 O.A.C. 64; 9 O.R.(3d) 1 (C.A.), refd to. [para. 45].

Goodman Estate v. Geffen, [1991] 2 S.C.R. 353; 127 N.R. 241, refd to. [para. 53].

Bakken Estate, Re (1992), 104 Sask.R. 67 (Q.B.), refd to. [para. 57].

Cashin v. Cashin, [1938] 1 W.W.R. 788 (P.C.), refd to. [para. 68].

Tulick Estate v. Ostapowich (1988), 91 A.R. 381 (Q.B.), refd to. [para. 80].

Inche Noriah v. Shaik Allie Bin Omar, [1929] A.C. 127 (P.C.), refd to. [para. 80].

Collins v. Forest Hill Investment Corp. et al., [1967] 2 O.R. 351 (Co. Ct.), refd to. [para. 86].

Bickerton v. Walker (1885), 31 Ch. Div. 151 (C.A.), refd to. [para. 87].

Marshall Wells Alberta Co. v. Alliance Trust Co. et al., [1920] 1 W.W.R. 907 (Alta. C.A.), refd to. [para. 88].

Feldstein v. Nystrom et al. (1961), 29 D.L.R.(2d) 62 (B.C.S.C.), refd to. [para. 89].

Bank of Nova Scotia v. Simonot et al. (1992), 105 Sask.R. 154; 32 W.A.C. 154 (C.A.), refd to. [para. 89].

Authors and Works :

Bernstein, Jack, The Family Business in Transition: Tax and Legal Aspects of Transfers to the Next Generation, p. 56 [para. 67].

Counsel:

R.E. Nation and S.A. Roberts, for the plaintiff, Dr. Harold Roenisch Sr.;

A.R. Robertson, for the defendants, Harold Roenisch Jr. and Sheep Creek Ranch Ltd.

This case was heard before Rawlins, J., of the Alberta Court of Queen's Bench, Judicial District of Calgary, who delivered the fol­lowing decision on March 4, 1993.