SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: CV-09-385359

MOTION HEARD JANUARY 22, 2014

RE: 2189205 Ontario Inc., Parminder Mutti and Navjot Kaur Chandi, plaintiffs

and

Springdale Pizza Depot Ltd., Ranjit Singh Mahil, Dilawar Singh Khakh, 2147390 Ontario Inc. and Kulwinder Singh, defendants

BEFORE: MASTER R.A. MUIR

COUNSEL: Shane P. Murphy for the plaintiffs
David S. Altshuller for the defendants Springdale Pizza Depot Ltd., Ranjit Singh Mahil and Dilawar Singh Khakh

REASONS FOR DECISION

[1] The plaintiffs seek directions with respect to paragraph 40 of my reference reasons for decision dated June 11, 2012. As part of that paragraph I ordered that the defendants Springdale Pizza Depot Ltd., Ranjit Singh Mahil and Dilawar Singh Khakh (the “Springdale Defendants”) pay compensation to the plaintiffs in the amount of $226,871.37 for certain supplies and equipment, payable upon the return of the equipment by the plaintiffs.

[2] The plaintiffs have kept virtually all of these items in storage in a barn in Caledon, Ontario since 2009. They are now prepared to deliver these items to the Springdale Defendants upon receipt of the required payment.

[3] The Springdale Defendants argue that the plaintiffs are “unable” to return the supplies and equipment because of the very poor condition of much of the equipment. This poor condition is a result of what the Springdale Defendants allege was the improper removal and storage of the equipment by the plaintiffs.

[4] I do not accept the argument of the Springdale Defendants. In my decision of June 11, 2012, I made an express finding that section 6(6) of the Arthur Wishart Act (Franchise Disclosure), 2000, S.O. 2000, C.3 (the “Act”) makes it mandatory that the equipment be repurchased regardless of its condition. My report on reference was confirmed on motion and that decision was subsequently affirmed by the Court of Appeal. In my view, the argument advanced by the Springdale Defendants expressly contradicts that finding. Moreover, the current condition of the supplies and equipment is partly the result of the Springdale Defendants’ decision to oppose the plaintiffs’ attempts to rescind the franchise agreement at every step. The Act is remedial legislation. There is no duty on a franchisee to mitigate. The franchisee is entitled to be made whole. Finally, there is no evidence of any deliberate acts of damage to the equipment by the plaintiffs.

[5] In my view, the plaintiffs are entitled to the payment as ordered by me on June 11, 2012. The Springdale Defendants shall pay the plaintiffs $226,871.37 for the supplies and equipment within 30 days. Upon receipt of the payment, the plaintiffs shall make the equipment available for pick-up by the Springdale Defendants, assuming the Springdale Defendants want it.

[6] In my view, the plaintiffs should have simply turned the equipment over to the Springdale Defendants and requested the payment as ordered. There will therefore be no costs order in respect of this motion.

Master R.A. Muir

DATE: January 22, 2014