The plaintiff, a Crown corporation, sought to replace its commercial lending software and entered into an agreement with the defendants based on representations that the defendants had an existing, mature 'out of the box' software product.
The implementation failed, and the plaintiff discovered the software did not actually exist but was still in development.
The plaintiff terminated the agreement and sued for fraudulent misrepresentation and breach of contract.
The court found that the defendants knowingly made false representations about the existence and capabilities of their software, which induced the plaintiff to enter the agreement and waste 15 months.
The court awarded the plaintiff over $44 million in damages for incremental costs and lost economic benefits caused by the delay, and dismissed the defendants' counterclaim for unpaid development charges.
