Canadian Pacific Lumber Co. v. Paterson Timber Co.

Canadian Pacific Lumber Co. v. Paterson Timber Co.

The court held that the incorporation of the contracting firm did not operate as a novation discharging the defendants; the original contract remained binding, a breach occurred and the respondents were entitled to damages; therefore the appeal was dismissed with costs and the trial judgment was affirmed.

Citation
(1910) 47 SCR 398
Parties
Plaintiff/respondent: Canadian Pacific Lumber Co.; Defendant/appellant: Paterson Timber Co.
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
9 December 1910
Procedural Posture
Contract Appeal / Appeal to the Supreme Court of Canada From the Court of Appeal for British Columbia
Outcome
Appeal dismissed with costs
Legal Topics
Right to Assign, Incorporation of Contracting Firm, Novation, Breach of Contract, Damages
Source Language
English
Contract Right to Assign Incorporation of Contracting Firm Novation Breach of Contract Damages

Case Brief

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Parties

Canadian Pacific Lumber Co.

Plaintiff/respondent

Paterson Timber Co.

Defendant/appellant

Procedural Posture

Contract Appeal / Appeal to the Supreme Court of Canada From the Court of Appeal for British Columbia

Legal Issues

  1. 1 Whether a contracting firm becoming an incorporated company effects a novation discharging the original contracting party
  2. 2 Whether the contract could be assigned to or by the incorporated entity
  3. 3 Whether there was a breach of contract and the appropriate measure of damages

Ratio Decidendi

The court held that the incorporation of the contracting firm did not operate as a novation discharging the defendants; the original contract remained binding, a breach occurred and the respondents were entitled to damages; therefore the appeal was dismissed with costs and the trial judgment was affirmed.

Court Disposition

Appeal dismissed with costs

Orders

  • Appeal dismissed with costs
  • Trial judgment affirmed; respondents' action for damages maintained with costs