FIC Real Estate Fund Ltd. v. Phoenix Land Ventures Ltd., 2011 ABQB 721

Court of Queen ’ s Bench of Alberta Citation: FIC Real Estate Fund Ltd. v. Phoenix Land Ventures Ltd., 2011 ABQB 721 Date: 20111122 Docket: 1003 13366 Registry: Edmonton Between: FIC Real Estate Fund Ltd. Plaintiff - and - Phoenix Land Ventures Ltd. Defendant _______________________________________________________ Memorandum of Decision of W. Breitkreuz, Master in Chambers _______________________________________________________ [ 1 ] This is an application by the plaintiff for

summary judgment for the sum of one million dollars, being the amount paid by the plaintiff for a 20% interest in a venture vaguely described in an agreement that is open to some speculation. [ 2 ] A copy of the agreement entered into between the parties on August 2, 2007 is attached as appendix A. [ 3 ] There is a preliminary matter that must be addressed: the defendant challenges the plaintiff’s status in the matter on the ground that it is not a legal entity. However, the plaintiff provided an agreement entitled “Agency Agreement” dated August 2, 2007 in which the named plaintiff agreed to be the Freedom Investment Club’s agent for the purposes of the agreement entered into between the

Freedom Investment Club and the defendant. [ 4 ] I will concede that if I were to grant

summary judgment that issue would need to be addressed or developed more thoroughly, although my conclusion would probably be that if all other aspects of the

summary judgment requirements were satisfied, I do not believe the issue of the plaintiff’s status would be an impediment to the claim. [ 5 ] The issue to be decided is what was the plaintiff acquiring under the trust agreement.

Paragraph 2 provides that [It] acquired a combined 20% ownership interest in the existing Golfdome land and building valued at Five Million ninety-two Thousand Dollars ($5,092,000.00). [ 6 ] Obviously the word “interest” requires more precise definition; without further precise definition it could refer to either a registerable interest in the land described in paragraph 1, or it could refer to a 20% interest in the new corporation referred to in paragraph 5 of the trust agreement.

It seems clear to me that the new corporation referred to in paragraph 5 is a corporation that had not yet been incorporated on August 2, 2007. [ 7 ] It is of course a basic rule of

interpretation that one must look at the whole agreement to see if any assistance lies in other parts of the agreement in interpreting any one clause of the agreement. [ 8 ] Paragraph 3

a) gives some support to the defendant’s argument that the plaintiff would have shares to be held by the defendant. But the last portion of 3

a) creates some difficulty because it provides that the shares would be held “as joint title holders”. [ 9 ] Paragraph 3

c) also adds support to the defendant’s argument that the plaintiff’s holding would be by way of shares in a corporation rather than being registered as a 20% owner of the land. [ 10 ] The defendant has not provided any evidence, but the plaintiff’s deponent was cross-examined, i.e. questioned, and the evidence shows that: 1. Phoenix Land Ventures Ltd. is the registered owner of the land in question (provided by way of answer to undertakings at the plaintiff’s deponent’s questioning. 2.

That the plaintiff was issued 20% of the shares of a corporation presumably registered to comply with paragraph 5 of the trust agreement. [ 11 ] Accordingly, the meaning of this contract cannot be ascertained in a

summary judgment application. [ 12 ] This may be a situation where the following statement from Dow Chemical Canada Inc. v. Shell Chemicals Canada Ltd. , 2010 ABCA 126 at paragraph 20 may apply: Where a contract is ambiguous, there is limited ability to call evidence on the circumstances surrounding the foundation of the contract and the commercial context in which it was made. [ 13 ] In the circumstances, I will not give the defendant costs of this application, even though it was successful in resisting the application.

It has had a million dollars of the plaintiff’s money for over four years and the plaintiff has virtually nothing to show for it. Costs of the application will be costs in the cause.

Heard on the 7 th day of November, 2011. Dated at the City of Edmonton, Alberta this 22 nd day of November, 2011. W. Breitkreuz M.C.C.Q.B.A. Appearances: Kenneth Fitz McLennan Ross for the Plaintiff Murray Engelking Engelking Wood for the Defendant