Case information

Contracts — Contractual interpretation — Standard of review — Good faith — Honest performance — Waiver — Estoppel — Proper standard of review applicable to contractual interpretation — Whether elements of factual matrix can be used to override trial judge’s decision — Proper standard of review applicable to trial judge’s finding of breach of duty of good faith and honest performance in contractual relations — Standard of review applicable to trial judge’s discretionary application of waiver and estoppel.

Case summaries are prepared by the Office of the Registrar of the Supreme Court of Canada (Law Branch). Please note that summaries are not provided to the Judges of the Court. They are placed on the Court file and website for information purposes only.

The Toronto Wholesale Produce Association leased land upon which it owned a double-sided static billboard that can be seen from the Gardiner Expressway. In mid-2012, ID Inc. approached the TWPA with the idea of transforming the billboard into a digital sign. ID alleged that it reached an oral agreement with the TWPA in January 2013, and that it had then begun working on a municipal permit application. In March 2013, ID and the TWPA entered into a written sale and maintenance agreement (“SMA”) for the transformation of the sign into a single digital sign. The SMA provided, in relevant part, that ID “shall make application … for any required permit to initially install the [digital sign] and any failure or inability of [ID] to obtain such permit for the [digital sign] within three hundred and sixty (360) days of the date of this Agreement shall result in this Agreement being terminated and [ID] shall be entitled to retain the initial deposit in compensation for [ID’s] bona fide efforts to obtain such permit” (“Permits clause”). It also included a “no waiver” clause and a clause providing that “[n]either [ID] nor its sales representative has made any representations to the [TWPA] regarding the [digital sign] other than those expressed in this Agreement and the Agreement contains and expresses the whole Agreement made between the parties.”

When the TWPA was advised by a third participant that provincial approval was more beneficial than municipal approval, the TWPA, ID and the third participant decided to pursue provincial approval, so ID withdrew its application for a municipal permit. When StrategyCorp indicated a desire to receive a portion of the advertising fees generated by the digital signs, ID reluctantly agreed. In December 2013, that agreement was memorialized in a “Consulting Agreement” between ID and StrategyCorp. By the time it was determined that a provincial permit was not available, the relationships between ID and the others had deteriorated. In 2015, StrategyCorp sent a letter to ID ending the Consulting Agreement on the basis that it was conditional on the SMA. Neither ID nor its principle responded. The TWPA began considering contracting with another company for transforming the billboard. With the help of another company, a municipal permit was received in July 2016.

ID began actions against the TWPA (this file) and StrategyCorp (SCC File No. 41692). There was a single trial but separate appeals. As against the TWPA, the trial judge Merritt J. allowed ID’s action. The Court of Appeal allowed the appeal, dismissed the action against the TWPA, and dismissed a cross-appeal.