Focus On

Contracts - Formation - Oral contracts

Thursday, September 15, 2016 @ 8:00 PM  


Appeal by the defendant, Pioneer Balloon, from a judgment in favour of the plaintiff, Zenex Enterprises. The plaintiff wholesaled and distributed consumer goods to, among others, the retail chain Dollarama. The defendant manufactured balloons that the plaintiff purchased and sold to Dollarama. In 2005, the defendant entered into an agreement to sell balloons directly to Dollarama. Several million dollars of balloons were sold over the next five years. The plaintiff sued, claiming it was entitled to a commission on the defendant’s sales pursuant to an oral agreement it made to introduce the defendant to Dollarama and to assist in obtaining Dollarama’s business. The defendant contended that it secured Dollarama’s business on its own, and that the plaintiff was limited to a $5,000 fee. The trial judge found that the defendant breached an oral agreement with the plaintiff and awarded damages of $266,725. The defendant appealed. The plaintiff cross-appealed a $5,000 costs award in favour of the defendant in respect of an interlocutory motion.

HELD: Appeal dismissed and cross-appeal allowed. The agreement between the parties contemplated a commercial introduction, offering the defendant the chance to do business directly with one of the plaintiff’s longstanding clients. The fact that a sales representative initially stood in for the president of the plaintiff due to a family illness, and that the president was absent from a follow-up meeting, did not undermine the plaintiff’s role in securing the Dollarama contract for the defendant through the introduction. The trial judge’s finding that the president took responsibility and helped service the Dollarama account was amply supported by the record. Although discovery evidence was erroneously admitted at trial, the properly admitted evidence provided sufficient support for the trial judge’s conclusions. In awarding costs of an interlocutory motion to the defendant, the trial judge did not have authority to alter the motion judge’s finding that costs of the motion would be in the cause. The award was set aside and the plaintiff’s trial costs award was increased by $5,000.