Union Properties Inc. v. Monenco Advisory Services Ltd. et al., (1996) 190 A.R. 257 (QB)

• Judge: Smith, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: September 18, 1996
• Citations: (1996), 190 A.R. 257 (QB)

Union Prop. Inc. v. Monenco Advisory (1996), 190 A.R. 257 (QB)

MLB headnote and full text

Union Properties Inc. (plaintiff) v. Monenco Advisory Services Limited and Monenco Agra Inc. (defendants)

(Action No. 9303-23206)

Indexed As: Union Properties Inc. v. Monenco Advisory Services Ltd. et al.

Alberta Court of Queen's Bench

Judicial District of Edmonton

Smith, J.

September 18, 1996.

Summary:

Union Properties Inc. (Union) leased office space to Monenco Agra Inc. (Monenco). The lease was renegotiated in 1985 for 10 years and a new lease signed in 1986. In 1993, prior to the expiration of the lease term, Monenco abandoned the premises. Monenco repudiated the lease, alleging breaches and claiming damages for those breaches. Union then terminated the lease and claimed all arrears, loss and damages.

The Alberta Court of Queen's Bench de­termined the issues accordingly.

Deeds and Documents - Topic 5004

Rectification - Persons entitled - The Alberta Court of Queen's Bench reviewed the law relating to rectification - See paragraphs 41 to 59.

Deeds and Documents - Topic 5004

Rectification - Persons entitled - [See Landlord and Tenant - Topic 2443 ].

Landlord and Tenant - Topic 2443

The lease - Variation or alteration - By collateral agreement or warranty - Union leased office space to Monenco - The lease was renegotiated in 1985 for 10 years - It stipulated a lease amount for the first 60 months and then stated, inter alia, that the lease amount for the next 60 months would be at "Market Rental Value" (MRV) - In 1993, prior to the expiration of the lease term, Monenco abandoned the premises - Union terminated the lease and claimed all arrears, loss and damages - At issue was the lease rental rate for the second 60 months - Union argued, inter alia, there were letters and verbal dis­cussions that formed a contract collateral to the lease indicating that the MRV lease price for the second 60 months equalled $12 per square foot - Accordingly, the lease should be rectified - The Alberta Court of Queen's Bench rejected Union's argument - See paragraphs 1 to 59.

Landlord and Tenant - Topic 2605

The lease - Interpretation - Commercial lease - Market rental value - In determin­ing the definition of "Market Rental Value" as used in a commercial lease, the Alberta Court of Queen's Bench stated that "I find the term MRV [Market Rental Value] is clear indication of a rental amount that the market in question would bear assuming willing participants. Further, I find the industry is well versed in deter­mining such rental rates, had tested methods for such determinations, and is capable of providing sufficiently certain ranges of values" - See paragraph 15.

Landlord and Tenant - Topic 2824

The lease - Breach by tenant - Abandon­ment of leased property - Union leased office space to Monenco - The lease was renegotiated in 1985 for 10 years - It stipulated a lease amount for the first 60 months and then stated, inter alia, that the lease amount for the next 60 months would be at "Market Rental Value" (MRV) - After the first 60 months expired, Union alleged that the second 60 month term required Monenco to pay a rental rate of $12 per square foot - Monenco claimed that it was only required to pay the MRV, which was less than $12 - Nonetheless, Monenco paid $12 per square foot until 1993, when it abandoned the premises - In calculating Union's damages for Monenco's abandonment, the Alberta Court of Queen's Bench reviewed the lease and calculated an MRV amount less than $12 per square foot - Further, Monenco was entitled to resti­tution for overpayment of the rent during this time - See paragraphs 61 to 69.

Landlord and Tenant - Topic 6064

Surrender and abandonment - Abandon­ment - By tenant - Liability for rent - [See Landlord and Tenant - Topic 2824 ].

Words and Phrases

Market Rental Value - The Alberta Court of Queen's Bench discussed the meaning of this phrase as used in a com­mercial lease.

Cases Noticed:

Horse & Carriage Inn Ltd. v. Baron (1975), 53 D.L.R.(3d) 426 (B.C.S.C.), refd to. [para. 13].

Canada v. Cattermole Timber Ltd. (1975), 12 N.R. 586 (F.C.A.), refd to. [para. 14].

Hawrish v. Bank of Montreal (1969), 66 W.W.R.(N.S.) 673 (S.C.C.), refd to. [para. 30].

Heilbut, Symons & Co. v. Buckleton, [1913] A.C. 30 (H.L.), refd to. [para. 30].

Barrett et al. v. Krebs et al. (1995), 164 A.R. 218; 27 Alta. L.R.(3d) 27 (Q.B.), refd to. [para. 42].

B.P. Resources Canada Ltd. v. General American Oils Ltd. (1989), 95 A.R. 121; 66 Alta. L.R.(2d) 82 (Q.B.), refd to. [para. 43].

American Merchant Marine Insurance Co. v. Buckley-Termaine Lumber & Timber Co., [1920] 3 W.W.R. 878 (B.C.S.C.), refd to. [para. 43].

Canada Square Corp. v. Versafood Serv­ices Ltd. et al. (1981), 130 D.L.R.(3d) 205 (Ont. C.A.), refd to. [para. 55].

Canadiana Gifts Ltd. v. Friedman, Friedman and Fong; Friedman, Friedman and Fong v. Canadiana Gifts Ltd. (1981), 32 A.R. 354 (Q.B.), refd to. [para. 57].

Mobil Oil Canada Ltd. v. Storthoaks (Rural Municipality), [1976] 2 S.C.R. 147; 5 N.R. 23; [1975] 4 W.W.R. 591, refd to. [para. 62].

Highway Properties Ltd. v. Kelly, Douglas & Co., [1972] 2 W.W.R. 28 (S.C.C.), refd to. [Schedule A].

Keneric Tractor Sales Ltd. v. Langille, [1987] 2 S.C.R. 440; 79 N.R. 241; 82 N.S.R.(2d) 361; 207 A.P.R. 361; 43 D.L.R.(4th) 171, refd to. [Schedule A].

Adanac Realty Ltd. v. Humpty's Egg Place Ltd. (1991), 113 A.R. 215; 78 Alta. L.R.(2d) 383 (Q.B.), refd to. [Schedule A].

Michaels et al. v. Red Deer College, [1976] 2 S.C.R. 324; 5 N.R. 99; [1975] 5 W.W.R. 575, refd to. [Schedule A].

Calmonton Investments Ltd. v. Tangye (1988), 87 A.R. 22 (C.A.), refd to. [Schedule A].

L.A. Furniture and Appliances Ltd. v. 330061 Alberta Ltd. (1988), 92 A.R. 111; 62 Alta. L.R.(2d) 186 (Q.B.), refd to. [Schedule A].

Saskatoon Square Ltd. v. Dunwoody & Co. and Burlingham, [1993] 7 W.W.R. 257; 111 Sask.R. 161 (Q.B.), refd to. [Schedule A].

Timberline Haulers Ltd. and Norwood Disposal Ltd. v. Grande Prairie (City) (1988), 89 A.R. 188; 59 Alta. L.R.(2d) 43 (Q.B.), refd to. [Schedule A].

West Edmonton Mall Ltd. v. McDonald's Restaurants of Canada Ltd. (1993), 144 A.R. 331 (Q.B.), affd. (1995), 178 A.R. 127; 110 W.A.C. 127 (C.A.), refd to. [Schedule A].

Goss v. Nugent (Lord) (1833), 110 E.R. 713, refd to. [Schedule A].

Gillespie Brothers & Co. v. Cheney, Edgar & Co., [1896] 2 Q.B. 59, refd to. [Schedule A].

Francey v. Wawanesa Mutual Insurance Co., [1990] 6 W.W.R. 329; 108 A.R. 82 (Q.B.), affd. [1992] 1 W.W.R. 52; 117 A.R. 318; 2 W.A.C. 318 (C.A.), refd to. [Schedule A].

Canadian Imperial Bank of Commerce v. Trapp (1985), 60 B.C.L.R. 241 (S.C.), refd to. [Schedule A].

Berry v. Berry, [1929] 2 K.B. 316, refd to. [Schedule A].

Pyramid Construction (Calgary) Ltd. v. Feil (1957), 11 D.L.R.(2d) 140 (Alta. T.D.), refd to. [Schedule A].

Boult Enterprises Ltd. v. Bissett (1985), 67 B.C.L.R. 273 (C.A.), refd to. [Schedule A].

Alta-West Group Investments Ltd. v. Femco Financial Corporation Ltd. and Femco Ventures Ltd. (1984), 57 A.R. 33; 34 Alta. L.R.(2d) 5 (Q.B.), refd to. [Schedule A].

Merrett Management Ltd. et al. v. Sellars et al. (1986), 76 A.R. 64 (Q.B.), refd to. [Schedule A].

Diversified Development Co. v. Cosmo­tology Schools of Canada Ltd. (1983), 44 A.R. 116 (Q.B.), refd to. [Schedule A].

Pointe Anne Quarries Ltd. v. M.F. Whalen, The (1921), 63 S.C.R. 109, refd to. [Schedule A].

Canada Deposit Insurance Corp. v. Cana­dian Commercial Bank (1990), 105 A.R. 368 (Q.B.), refd to. [Schedule A].

ITT Industries of Canada Ltd. v. Toronto-Dominion Bank (1988), 90 A.R. 310; 63 Alta. L.R.(2d) 87 (Q.B.), refd to. [Schedule A].

McMillen v. Chapman, [1953] 2 D.L.R. 671 (Ont. C.A.), refd to. [Schedule A].

Augdome Corp. v. Gray et al., [1975] 2 S.C.R. 354; 3 N.R. 235; 49 D.L.R.(3d) 372, refd to. [Schedule A].

B.G. Preeco 3 Ltd. v. Universal Explora­tions Ltd. (1987), 80 A.R. 225; 54 Alta. L.R.(2d) 65 (Q.B.), refd to. [Schedule A].

Devon Estates Ltd. v. Royal Trust Co. et al. (1994), 161 A.R. 111 (Q.B.), refd to. [Schedule A].

Willow Tree Holdings Ltd. v. Sims (1991), 100 N.S.R.(2d) 216; 272 A.P.R. 216; 15 R.P.R.(2d) 277 (T.D.), refd to. [Schedule A].

Krenzel et al. v. Interprovincial Security Patrol (Red Deer) Ltd. et al. (1982), 38 A.R. 153 (Q.B.), refd to. [Schedule A].

Winbaum v. Zolumoff, [1956] O.W.N. 27 (C.A.), refd to. [Schedule A].

Inverarity v. Muller (1926), 31 O.W.N. 339 (H.C.), refd to. [Schedule A].

Davey v. Christoff (1916), 28 D.L.R. 447 (Ont. C.A.), refd to. [Schedule A].

Saint George Mansions Ltd. v. Hethering­ton (1918), 41 D.L.R. 614 (Ont. C.A.), refd to. [Schedule A].

Central Mortgage & Housing Corp. v. Conaty (1967), 61 D.L.R.(2d) 97 (Alta. C.A.), refd to. [Schedule A].

Zero Stores (Sask.) Ltd. v. K.A.H. Invest­ments Ltd. et al. (1983), 44 A.R. 30 (C.A.), refd to. [Schedule A].

Bank of Nova Scotia v. Romaine (1988), 89 A.R. 304 (Q.B.), refd to. [Schedule A].

Claiborne Industries Ltd. et al. v. National Bank of Canada et al. (1989), 34 O.A.C. 241; 59 D.L.R.(4th) 533 (C.A.), refd to. [Schedule A].

Kamitomo v. Pasula et al. (1983), 50 A.R. 280; 29 Alta. L.R.(2d) 375 (Q.B.), refd to. [Schedule A].

Milosis and Jones v. Ladd Exploration Co. (1986), 72 A.R. 340 (Q.B.), refd to. [Schedule A].

Wishloff and Wishloff v. Boyko and Boyko (1984), 52 A.R. 260 (Q.B.), refd to. [Schedule A].

Pattison (Jim) Lease v. 277278 B.C. Ltd., [1993] B.C.J. No. 2769 (S.C.), refd to. [Schedule A].

Gordeyko v. Edmonton (City) (1986), 71 A.R. 192; 45 Alta. L.R. 201 (Q.B.), refd to. [Schedule A].

Oriole Oil and Gas Ltd. v. American Eagle Petroleums Ltd. (1980), 27 A.R. 415; 24 Alta. L.R.(2d) 121 (Q.B.), affd. (1981), 27 A.R. 411; 24 Alta. L.R.(2d) 130 (C.A.), refd to. [Schedule A].

Freeman & Lockyer (A Firm) v. Buckhurst Park Properties (Managal) Ltd., [1964] 1 All E.R. 630 (C.A.), refd to. [Schedule A].

O'Riordan v. Central Agencies Camrose Ltd. (1987), 78 A.R. 243; 51 Alta. L.R.(2d) 206 (C.A.), refd to. [Schedule A].

Société Générale (Canada) et al. v. Gulf Canada Resources Ltd. (1995), 169 A.R. 317; 97 W.A.C. 317; 31 Alta. L.R.(3d) 137 (C.A.), refd to. [Schedule A].

Air Canada and Pacific Western Airlines Ltd. v. British Columbia, [1989] 1 S.C.R. 1161; 95 N.R. 1; [1989] 4 W.W.R. 97, refd to. [Schedule A].

Conmac Western Industries v. Robinson et al. (1993), 139 A.R. 321; 9 Alta. L.R.(3d) 232 (Q.B.), refd to. [Schedule A].

Gainers Inc. v. Canadian Pacific Ltd. (1983), 143 A.R. 146 (Q.B.), refd to. [Schedule A].

Penvidic Contracting Co. v. International Nickel Co. of Canada Ltd., [1976] 1 S.C.R. 267; 4 N.R. 1; 53 D.L.R.(3d) 748, refd to. [Schedule A].

Authors and Works Noticed:

Bower, Spencer, The Law Relating to Estoppel by Representation (1977), para. 55 [Schedule A].

Chitty on Contracts (26th Ed.), pp. 534, 535 [Schedule A].

Haber, Harvey M., The Commercial Lease - A Practical Guide (2nd Ed.), pp. 317, 318, 319, 320 [Schedule A].

Halsbury's Laws of England (4th Ed.), vol. 12, paras. 1193, 1194 [Schedule A].

Maddaugh and McCamus, The Law of Restitution (1993), p. 224 [Schedule A].

McGregor on Damages (15th Ed. 1988), para. 289 [Schedule A].

Wigmore on Evidence (3rd Ed.), vol. 2, pp. 162 to 181 [Schedule A].

William & Rhodes, Canadian Law of Landlord and Tenant (6th Ed.), pp. 10-45 to 10-47 [Schedule A].

Counsel:

Richard Cotter, Q.C., and Brian Foster (Milner Fenerty), for the plaintiff;

Paul Edwards and David Hardy (Ballem McDill MacInnes Eden), for the defen­dants.

This case was heard at Edmonton, Alberta, before Smith, J., of the Alberta Court of Queen's Bench, Judicial District of Edmonton, who delivered the following judgment on September 18, 1996.