Frank J. C. Newbould

The appellant bank and respondent trust company entered into agreements to finance a condominium project.

When the real estate market collapsed, the respondent breached its commitment to provide takeout financing, leaving the appellant with a significant shortfall.

The trial judge awarded the appellant damages including compound pre-judgment and post-judgment interest at the rate specified in the loan agreement.

The Court of Appeal substituted simple interest.

The Supreme Court of Canada allowed the appeal, holding that courts have jurisdiction at common law and in equity to award compound interest as expectation damages to fully compensate a plaintiff for the time-value of money.

The appellants, Air Ontario pilots, brought an action against the respondents, Air Canada pilots, for breach of contract based on the union constitution after the respondents refused to implement an arbitration award integrating their seniority lists.

The Supreme Court of Canada dismissed the appeal, holding that the historical legal fiction of a web of contracts between individual union members is no longer necessary or practical.

Instead, the Court recognized that a trade union is a legal entity capable of entering into a contract of membership with each individual member, and therefore, union members cannot be held personally liable to one another for breaching the union constitution.