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August 5, 1999 |
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| Duckman vs. Jelian Distributors Inc. |
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Between
Lloyd Duckman and Les Cafes Filtres Rombouts Inc. and Rombouts
Coffee Ontario Ltd., plaintiffs, and Jelian Distributors Inc. and Jerry Streisfield also known as Jerry Field, defendants |
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[2002] O.J. No. 871
Court File No. 43571/97 |
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Ontario Superior Court of Justice
Newmarket, Ontario
Stinson J. |
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Heard: August 5, 1999.
Judgment: August 9, 1999.
(14 pp.) |
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James F. Diamond, for the plaintiffs.
Jeffrey Streisfield, for the defendant. |
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| Business law — Sale of a business — Conditions and warranties — Restitution — Unjust enrichment — Benefit acquired from the plaintiff — Recovery of money — Contracts — Performance or breach — Breach — What constitutes a breach — Evidence — Special modes of proof — Admissions — Judicial admissions — Pleadings — Bailment — Liability of bailee — Burden of proof. |
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| Action by Duckman, Les Cafes Filtres Rombouts, and Rombouts Coffee Ontario against Jelian Distributors for payment of commissions and on account of certain goods, arising out of the sale of a business. Duckman was the principal of a business which he operated through Les Cafes Filtres and Rombouts Coffee. Duckman made an oral agreement to sell the business to Jelian. Jelian was to pay a commission to Duckman from its sales of products manufactured by a Belgian company, Koffee F. Rombouts N.V. However, the agreement was conditional upon Jelian obtaining an exclusive distributorship agreement from Koffee. Duckman transferred the assets of the business to Jelian. Jelian also agreed to take certain goods on consignment. Duckman sought payment of commissions owing from the sale of the Koffee products, as well as payment for the consignment items. Jelian argued that the distributorship agreement was never obtained and therefore the contract with Duckman never became effective. In other proceedings, Koffee claimed against Jelian for payment for goods supplied to Jelian. In its statement of defence and counterclaim in that action, Jelian pleaded that Koffee had granted it exclusive distribution rights to market and sell its products. |
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| Held, Action allowed. |
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| The contract was enforceable and Jelian was liable to Duckman for the commissions. The distributorship agreement between Jelian and Koffee had come into existence, which satisfied the contract's condition. Jelian's pleading in the action by Koffee was admissible and the admission contained therein was accorded great weight. The pleading was prepared by the brother of the president of Jelian, who must have been aware that the distributorship agreement was a live issue in the action by Duckman. An adverse inference was drawn from Jelian's failure to call evidence to explain the admission. Alternatively, Duckman was entitled to the payment of the same amount on the basis of unjust enrichment. Jelian received a benefit in retaining the commission amount which would otherwise have been payable. Duckman suffered a corresponding deprivation, as he had transferred the assets of the business without receiving commission. There was no juristic reason for the enrichment. Jelian was obliged to pay for the consignment items. Jelian failed to discharge its onus as a bailee, of proving that the loss of the goods was not due to its negligence or improper conduct. |
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