Scanwood Canada Ltd. (Re)

Scanwood Canada Ltd. (Re)

The court held the issues concerning trademark and IKEA's right to insist on quality were previously adjudicated (res judicata) and there is no new compelling evidence to reopen them; the buy‑back agreement vests the quality decision with IKEA and trademark concerns prevent third‑party resale, therefore the court will not compel IKEA to purchase and authorizes destruction of the unsold inventory.

Citation
2011 NSSC 495
Parties
Receiver (applicant): Scanwood Canada Limited (in Receivership); Buyer/respondent: IKEA Supply AG; Creditor/opposer: Royal Bank of Canada; Interested Party: Province of Nova Scotia
Court
Supreme Court of Nova Scotia
Jurisdiction
Canada
Judgment Date
19 December 2011
Procedural Posture
Bankruptcy/receivership / Application for Directions Regarding Disposition of Inventory (motion)
Outcome
Application to destroy remaining inventory granted; RBC's requests to compel IKEA to purchase or force sale to third parties denied; matter not reopened on res judicata grounds.
Legal Topics
Receivership, Buy‑back Agreement, Res Judicata / Issue Estoppel, Destruction of Assets, Sale of Assets, Trademark Protection, Quality Conditions
Source Language
English
Bankruptcy and Insolvency Contract Law Trademark Law Equity Commercial/property Law Receivership Buy‑back Agreement Res Judicata / Issue Estoppel +4 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Legal principles 3 Authorities cited 8 Party arguments 2 Amounts and remedies 5
Sign in to unlock

Parties

Scanwood Canada Limited (in Receivership)

Receiver (applicant)

IKEA Supply AG

Buyer/respondent

Royal Bank of Canada

Creditor/opposer

Province of Nova Scotia

Interested Party

Procedural Posture

Bankruptcy/receivership / Application for Directions Regarding Disposition of Inventory (motion)

Legal Issues

  1. 1 Whether the doctrine of res judicata/issue estoppel bars relitigation of disposition of inventory
  2. 2 Whether the court can order IKEA to purchase inventory under the buy‑back agreement or in equity
  3. 3 Whether the dressers can be sold to third parties despite IKEA's trademark and quality objections

Ratio Decidendi

The court held the issues concerning trademark and IKEA's right to insist on quality were previously adjudicated (res judicata) and there is no new compelling evidence to reopen them; the buy‑back agreement vests the quality decision with IKEA and trademark concerns prevent third‑party resale, therefore the court will not compel IKEA to purchase and authorizes destruction of the unsold inventory.

Court Disposition

Application to destroy remaining inventory granted; RBC's requests to compel IKEA to purchase or force sale to third parties denied; matter not reopened on res judicata grounds.

Orders

  • Receiver authorized to destroy remaining dressers not purchased by IKEA
  • Application to compel IKEA to purchase inventory dismissed