Marvin Foy Marketing Incorporated v. Omnitrade Limited

Marvin Foy Marketing Incorporated v. Omnitrade Limited Collection Decisions of the Court of Appeal Date 2004-12-23 Docket numbers C39714 Judges Laskin, John Ivan; Rosenberg, Marc; LaForme, Harry Smith Subject Civil Decision Content DATE: 20041223 DOCKET: C39714 COURT OF APPEAL FOR ONTARIO RE: MARVIN FOY MARKETING INCORPORATED (Plaintiff/Respondent) (Appellant by Cross-Appeal) -and- OMNITRADE LIMITED (Defendant/Appellant) (Respondent by Cross-Appeal) BEFORE: LASKIN, ROSENBERG and LaFORME JJ.A. COUNSEL: David M. Goodman for the defendant/appellant, respondent by cross-appeal Jack Copelovici for the plaintiff/respondent, appellant by cross-appeal HEARD AND RELEASED ORALLY: December 20, 2004 On appeal from the judgment of Justice Susan G. Himel of the Superior Court of Justice dated January 29, 2003. ENDORSEMENT A. The Appeal [1] The appellant Omnitrade Limited appeals the finding of liability under the Sale of Goods Act, R.S.O. 1990, c. S.1 and the dismissal of its counterclaim. The respondent Marvin Foy Marketing Incorporated (“MFM”) cross-appeals on the award of damages. [2] On its appeal on liability, Omnitrade makes two main submissions: 1) The warranty letter reflected the reasonable expectations of the parties. The number of service calls, roughly equivalent to the number contemplated by the letter, shows that the machine was reasonably fit for the purpose it was purchased. In connection with this submission, Omnitrade points out that MFM was compensated for every service call thus, in effect, awarding it damages for having not received a perfect machine; and 2) Omnitrade made no representations about the set-up time required to operate this machine. Thus, the award for set-up costs cannot be supported. [3] Except in one minor respect, we do not accept these submissions. [4] We acknowledge that some evidence supported Omnitrade’s position, but other evidence equally supported MFM’s position. The trial judge’s finding that the continuing problems with this machine contravened s. 15 of the Sale of Goods Act reflects no palpable and overriding error. In so stating, we do not agree that the warranty letter conclusively established “reasonable fitness”. In deciding whether s. 15 was breached, the trial judge was entitled to look at the nature of the problems and their recurrence. [5] The trial judge found that additional set-up time was required because of the problems with the machine. Again, we are not persuaded that this finding reflected any palpable and overriding error. Indeed, Mr. Boyce’s May 11, 1990 memo supports the trial judge’s finding. On the basis of this finding, the award of damages for set-up costs was justified. [6] However, we are of the view that the trial judge’s damages award overcompensated MFM. We agree with Mr. Goodman that, by awarding damages for lost time for every single service call, the trial judge, in effect, compensated MFM on the basis it was to receive a perfect machine, not a reasonably fit one. We think that rough justice would be met by reducing that component of the damage award from $14,600 to $7,000. [7] We agree with the trial judge’s dismissal of the counterclaim, except for the invoice for moving expenses. That expense would have been incurred regardless of the problems with the machine. The appellant is entitled to be paid for this invoice in the amount of $6,976.40. B. The Cross-Appeal [8] We do not agree with MFM’s position on the cross-appeal. (a) The LKP Claim [9] Mr. Keogh was an unreliable estimator of the business he could generate, even before the Omni-Adast 856 Press machine was installed. He never came close to generating the $7,000-worth of monthly income that he promised. The unreliability of his evidence supports the trial judge’s findings that the losses claimed in connection with LKP were too speculative to justify a damages award. (b) The Saturn Solutions Claim [10] Some evidence might be said to support the claim of loss of business from Saturn. However, other evidence – especially that of Marvin Foy – supported the trial judge’s finding that the alleged loss of business could not be tied to the problems with the machine (save for the one job she awarded). C. Conclusion [11] The damages awarded to MFM are reduced by $14, 576.40. Otherwise, the appeal is dismissed. The cross-appeal is also dismissed. [12] In view of Omnitrade’s limited success on the appeal , we accept Mr. Copelovici’s submission and award the appellant $3,000 in costs, inclusive of disbursements and G.S.T. Signed: “John Laskin J.A.” “M. Rosenberg J.A.” “H.S. LaForme J.A. ”