W. Sarasin

This trial determined the operability of a $65,298.24 credit memo issued by Architectural Millwork & Door Installations Inc. (AMDI) to Provincial Store Fixtures Ltd. (Provincial) in a construction subcontract dispute.

The court found that Provincial had induced AMDI to issue the credit memo with a promise to remit payment upon receiving funds from the general contractor, Govan Brown, a promise Provincial subsequently breached.

AMDI was deemed entitled to revoke the credit memo because Provincial failed to fulfill its undertaking and could not demonstrate reliance on the credit when it settled its own claim against Govan Brown.

Provincial was ordered to pay AMDI the full amount of the credit memo plus pre-judgment interest.

The plaintiff subcontractor brought a motion for summary judgment against the defendant contractor for unpaid invoices totaling $126,994.55 relating to a casino project.

The defendant argued the amount should be reduced by a $65,298.24 credit memo and claimed a right of set-off for damages allegedly caused by the plaintiff's abandonment of a separate, unrelated project.

The court granted partial summary judgment for $61,696.31, finding that the defendant's claim for equitable set-off failed because the two projects were entirely separate and not closely connected.

However, the court found that whether the credit memo remained operative was a genuine issue requiring a trial.

A commercial landlord sued a prospective tenant for damages arising from the tenant’s refusal to proceed with a lease after an offer to lease had been executed and a draft lease negotiated.

During design work, the parties discovered that a structural bearing wall prevented installation of the large windows contemplated by the offer, and that installing them would cost more than ten times the estimated amount.

The court held that the subsequent draft lease was unenforceable under the Statute of Frauds because it was never signed and no written memorandum satisfied the statute.

The court further found that the original offer to lease was frustrated by an unforeseeable structural condition that fundamentally altered the nature of the bargain, as the building could not reasonably provide the natural light and design features essential to the tenant’s intended use without radically increased cost.

Both the action and the tenant’s counterclaim were dismissed.