In Agribrands Purina Canada Inc. v. Kasamekas, Goudge J.A. ruled that
breach of contract does not qualify as "unlawful conduct" necessary for the
tort of unlawful conduct conspiracy, and deceitful actions are sufficient
grounds for punitive damages.
Following a series of agreements, Purina supplied feed to two distributors
in the same area, violating its exclusivity agreement with one of the
distributors. The trial judge found Purina liable for the tort of unlawful
conduct conspiracy. In an attempt to define what qualified as "unlawful
conduct," the trial judge applied jurisprudence relating to the tort of
intentional interference with economic relations, under which conduct making
the defendant liable can include conduct prohibited by law, contract,
convention, or understanding. The Court disagreed with this analysis,
holding that for an action to constitute "unlawful conduct" for the tort of
intentional interference, the conduct must be actionable; it must be wrong
in law. Breach of contract, convention, or understanding, on the other hand,
are not "unlawful" for purposes of unlawful conduct conspiracy. Goudge J.A.
also noted that the two torts have evolved separately and judges should
avoid ignoring the different historical paths torts have travelled in an
attempt to create a "unified theory of economic torts."
This case also deals with the matter of punitive damages. The Court
disagreed with the trial court's reason for allowing punitive damages that
breach of contract should be discouraged. Instead, they allowed
the punitive damages by finding that Agribrands Purina's deceitful action of
supplying a competitor with merchandise when it had expressly said it would
not do so constituted a marked departure from ordinary standards of decency
and an "independently actionable" claim.
June 20, 2011
http://www.ontariocourts.on.ca/decisions/2011/2011ONCA0460.htm
Leonard Elias & Dominik Swierad
No comments:
Post a Comment