Court File and Parties

COURT FILE NO.: CV-06-CV305132-0000 DATE: 20160707 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

MARK COUPER Plaintiff – and – NU-LIFE CORP., NU-LIFE NUTRITION LTD., VITAQUEST INTERNATIONAL LLC, AND KEITH FRANKEL Defendants

Counsel: Mr. G. McGuire, for the Plaintiff Mr. Kenneth E. Jull, for the Defendants

Reasons for Decision (applicable exchange rate)

J. Macdonald, j.

[1] In my reasons for judgment delivered on April 29, 2016, I assessed the damages awarded to the plaintiff in U.S. dollars. I called for submissions in respect of the conversion of this award into Canadian dollars. The plaintiff has delivered brief submissions. The defendants have taken no position. They have made a brief reference to exchange rates in relation to costs issues.

[2] The Courts of Justice Act, R.S.O. 1990, c.43, s.121, governs. The general rule is that the exchange rate is that which is in effect when payment of the obligation is made. However, s.121(3) gives the Court the discretion to fix the exchange rate on a date which is equitable in the circumstances.

[3] In Stott v. Merit Investment Corp. (1988), 63 O.R. (2d) 545 (C.A), Finlayson, J.A., for the majority of the court held that, in relation to a counterclaim by Merit against a former salesperson for losses sustained as a result of the salesperson’s wrongdoing in the administration of an unpaid customer account, the proper method was to convert the debt to Canadian dollars as of the date the commitment was made, not the date of payment. Leave to appeal to the Supreme Court of Canada was refused. In Zesta Engineering Ltd. v. Cloutier, 2010 ONSC 5810, [2010] 86 CCEL (3d) 1, Stinson J. noted a dramatic shift in the respective values of Canadian and US dollars in the time between when the debt was incurred in US dollars and when it likely would be paid, in Canadian dollars. Stinson J. selected the exchange rate which would put the creditor in the position it would have been in, but for the wrong committed. That was the rate at the time the debt was incurred.

[4] Pursuant to s.121(3) of the Courts of Justice Act, I exercise my discretion to impose the exchange rates which were in effect when the defendants became obliged to pay various judgment sums to the plaintiff. My reasons are as follows. First, a judgment for a fixed and exigible sum in Canadian dollars cannot issue if the exchange rate is left undetermined, for example because it is not known when the judgment debt will be paid. Second, usage of the historical exchange rates puts the plaintiff in the position he would have been in if paid when his entitlements to payments arose. Third, there is no significant difference between the historical exchange rates and the rate on April 29, 2016, the date when Reasons for Judgment were delivered and the event closest to the unknown future date of payment.

[5] In this case, there is no certainty about when the defendants will pay the judgment sum to the plaintiff. The defendants are entitled to appeal. The main defendants, Vitaquest International LLC (“Vitaquest”) and Keith Frankel are, respectively, a Delaware corporation carrying on business in New Jersey and an American citizen resident in New Jersey. Action to enforce the judgment in New Jersey may be necessary.

[6] The U.S. dollar (USD) to Canadian dollar (CAD) exchange rate on April 29, 2016, the date upon which judgment was granted, was $1.26.

[7] There were various heads of damages assessed in USD which were held to be owing many years ago. First, Vitaquest was ordered to pay the plaintiff $200,000 on the following basis. Vitaquest agreed to pay the plaintiff that amount in four equal $50,000 payments, made bi-weekly. The first payment was made on or about October 14, 2003, but by the co-defendant Nu-Life Corporation, and was credited to Nu-Life’s obligations for that reason. Consequently, the $50,000 payments should have been made by Vitaquest on each October 14, 2003, October 28, 2003, November 11, 2003, and November 25, 2003. The USD-CAD exchange rates on each of these dates were, and applying these exchange rates, the amounts owing in Canadian dollars on each of these dates were as follows:

Date	Exchange Rate	Owing
October 14, 2003	$1.32	$66,000.00
October 28, 2003	$1.31	$65,500.00
November 11, 2003	$1.32	$66,000.00
November 25, 2003	$1.30	$65,000.00
Total:		$262,500.00

[8] Second, Vitaquest was also ordered to pay the plaintiff $44,931.51 which became due and payable on October 20, 2003, the date of the contract. This amount was in respect of the plaintiff’s work for Vitaquest prior to the contract date. On October 20, 2003, the USD to CAD exchange rate was $1.31. On that date, the amount owing in Canadian dollars therefore was $58,860.28.

[9] Third, Vitaquest was also ordered to pay to the plaintiff damages representing his salary of $200,000 (USD) per annum, commencing October 20, 2003, and ending in mid-March 2005. In my opinion, the salary likely would have been paid in monthly increments of $16,666.67 (USD). I assume for ease of calculation that 12 equal monthly payments would have been made on the 15th of each month. The applicable USD to CAD exchange rates as of these dates were as follows:

Date	Exchange Rate
November 15, 2003	$1.30
December 15, 2003	$1.31
January 15, 2004	$1.27
February 15, 2004	$1.32
March 15, 2004	$1.33
April 15, 2004	$1.33
May 15, 2004	$1.39
June 15, 2004	$1.36
July 15, 2004	$1.32
August 15, 2004	$1.31
September 15, 2004	$1.30
October 15, 2004	$1.26
November 15, 2004	$1.19
December 15, 2004	$1.23
January 15, 2005	$1.22
February 15, 2005	$1.23
March 15, 2005	$1.21

[10] Applying these exchange rates to a monthly salary of $16,666.67 (USD) results in the following amounts owing in Canadian dollars:

Date	Amounts Owing
November 15, 2003	$21,666.67
December 15, 2003	$21,833.34
January 15, 2004	$21,166.67
February 15, 2004	$22,000.00
March 15, 2004	$22,166.67
April 15, 2004	$22,166.67
May 15, 2004	$23,166.67
June 15, 2004	$22,666.67
July 15, 2004	$22,000.00
August 15, 2004	$21,833.34
September 15, 2004	$21,666.67
October 15, 2004	$21,000.00
November 15, 2004	$19,833.34
December 15, 2004	$20,500.00
January 15, 2005	$20,333.34
February 15, 2005	$20,500.00
March 15, 2005	$20,166.67
Total:	$364,666.72

[11] Fourth, Vitaquest was also ordered to pay to the plaintiff the sum of $1,250.00 as nominal compensation for the personal value of a company vehicle from October 20, 2003 to mid-March 2005. The USD to CAD exchange rates over this time period ranged from a high of $1.33 to a low of $1.19. The average rate over this time period is $1.2870, which I round to $1.29. Applying that exchange rate gives a Canadian dollar value to this award of $1,612.50.

[12] The Canadian dollar amount owing is therefore:

$262,500.00 $58,860.28 $364,666.72 $1,612.50 Total: $687,639.50

Dated at Toronto this ______ day of July, 2016. Mr. Justice John Macdonald

Released: July 7, 2016