Paul Nault v. Angela Nault, 2012 ABQB 13

Court of Queen ’ s Bench of Alberta Citation: Nault v. Four C ’ s Holdings Ltd., 2012 ABQB 13 Date: 20120111 Docket: 1103 08720 Registry: Edmonton Between: Paul Nault and Angela Nault Applicants - and - Four C ’ s Holdings Ltd.

Respondent _______________________________________________________ Reasons for Judgment of Chief Justice Neil Wittmann _______________________________________________________ Introduction [ 1 ] The Applicants, Paul Nault and Angela Nault (“the Naults”), were the individual Vendors in a Share Purchase Agreement made between the Vendors and the Respondent, Four C’s Holdings Ltd. (“Four C’s”) on January 30 th , 2009. The Vendors sold all of the shares and shareholder loans in RCI Electrical Service Ltd. (the “Corporation”) to Four C’s.

At the same time, namely January 30 th , 2009, the Naults each entered into Non-Competition Agreements with Four C’s. The Naults’ covenants under the Non-Competition Agreements included a provision that provided that if Four C’s should breach or otherwise be in material default of any term of the Share Purchase Agreement without remedying the same, the Naults would be relieved from any obligation not to compete on the basis that the restriction would cease and be of no further effect.

[ 2 ] In this application, the Naults claim that Four C’s breached or was otherwise in material default of a term of the Share Purchase Agreement. They wish this Court to declare that they are no longer subject to any restrictions in the Non-Competition Agreements. Key Provisions of the Non-Competition Agreements and the Share Purchase Agreement [ 3 ]

Section 7 of the Non-Competition Agreements states as follows: 7. Default Under Purchase Agreement The restrictions herein shall cease and be of no further effect if Four C’s shall breach or otherwise be in material default of any term of the Share Purchase Agreement and shall have not remedied such material default within five

(5) Business Days following receipt of written notice from Paul [or Angela] setting forth such breach. [ 4 ] The Non-Competition Agreement of Paul Nault, contains the following provisions: (e) “Closing Date ” means January 30 th , 2009; (g) “Consulting Agreement ” means the Consulting Agreement dated the 30 th day of January, 2009 among Four C’s, Nault Holdings Ltd., and Paul; (k) “Period ” means the later of (

i) the period of three (3) years from the Closing Date, or (ii) the period of three (3) years from the expiry or termination of the Consulting Agreement 3.

Non-Competition Paul covenants that, during the Period, Paul will not, either directly or indirectly, as advisor, broker, finder, partner, shareholder, joint venturer, owner, employer, employee, consultant, director or in any other manner whatsoever, within the Restricted Area, establish, carry on, be engaged in, be concerned with, be interested in, have a financial interest in, advise, lend money to, guarantee the debts or obligations of, solicit advertising for or permit his name or any part thereof to be used or applied by any Person engaged in, concerned with or interested in, any commercial activity which is the same or substantially similar to, or which competes, directly or indirectly, with all or any part of the Business as it is carried on during the Period. [ 5 ] Relevant provisions of the Share Purchase Agreement are as follows: 1.1

Definitions In this Agreement: (a) “Accountant” means a partner practising with PriceWaterhouseCoopers LLP in Edmonton, Alberta as determined by the managing partner of that office; (l) “Closing Date” means January 30 th , 2009 or such other date as shall be agreed upon in writing by the Vendors and the Purchaser;

2.6 Contingent Payments The Purchaser shall pay to the Vendors, as part of the Purchase Price due hereunder, the following amounts (the “ Contingent Payments ”): (

a) with respect to the twelve-month period ending on January 31, 2010 (the “ First Measurement Period ”), a non-cumulative amount equal to thirty-three (33%) percent of the amount by which the net after-tax earnings of the Corporation for the First Measurement Period, determined in accordance with GAAP, exceed Two Hundred Thousand ($200,000.00) Dollars. (

b) with respect to the twelve-month period ending on January 31, 2011 (the “ Second Measurement Period ”), a non-cumulative amount equal to thirty-three (33%) percent of the amount by which the net after-tax earnings of the Corporation for the Second Measurement Period, determined in accordance with GAAP, exceed Two Hundred Thousand ($200,000.00) Dollars. ... In determining any Contingent Payment, the following provisions apply: (

i) No later than sixty (60) days following the First Measurement Period or Second Measurement Period (each, a “ Measurement Period ”), as applicable, the Purchaser shall cause the accountants of the Corporation to prepare and deliver to the Vendors’ Representative a written statement of the Purchaser’s calculation of the Contingent Payment for the applicable Measurement Period (the “ Contingent Payment Statement ”). The Contingent Payment Statement will be prepared in accordance with GAAP and will be accompanied with all relevant detail and supporting information.

The Purchaser shall provide the Vendors’ Representative and his accounting advisors with access to all of the Corporation’s accounting books and records and the appropriate personnel relating to the Corporation, and shall fully cooperate with the Vendors’ Representative and his accounting advisors to the extent required to verify accuracy, presentation and other matters relating to the preparation of the Contingent Payment Statements. (ii) The provisions of Sections 2.3(

b) through 2.3(

e) shall apply, mutatis mutandis , with respect to the final determination of the Contingent Payment for the applicable Measurement Period. ... 2.3 Preparation of Closing Date Financial Statements (

b) Within fifteen

(15) Business Days following delivery to the Purchaser of the Draft Financial Statements and Working Capital Statement, the Purchaser shall notify the Vendor in writing if the Purchaser has any objections to the Draft Financial Statements or the Working Capital Statement (hereinafter referred to in this

Section 2.3 as the “ Notice of Objection ”). The Notice of Objection shall state in reasonable detail the basis of each objection and the amount in dispute. (

c) If the Purchaser disputes the Draft Financial Statements or the Working Capital Statement, the parties will work expeditiously and in good faith in an attempt to resolve the dispute within a further period of fifteen

(15) Business Days after the date of the notification of the dispute, failing which the dispute may be submitted by the Purchaser or the Vendors to the Accountant for final determination. In making a determination, the Accountant shall only decide on the amounts in dispute set forth in the Notice of Objection. The Vendors and Purchaser shall use commercially reasonable efforts to cause the Accountant to make a determination within thirty (30) days of the submission of the dispute to the Accountant.

The Accountant shall be instructed to allow each party to present their respective positions regarding the Draft Financial Statements or the Working Capital Statement, as applicable, and each party shall have the right to present additional documents, materials, and other information, and to make an oral presentation to the Accountants regarding the dispute. Any other documents, materials, or other information shall be copied to each party concurrent with their submission to the Accountant and each party shall be entitled to attend any oral presentation and reply to thereto.

(

d) If no Notice of Objection is given within the fifteen

(15) Business Day period referred to in

Section 2.3(

b) or upon a resolution or determination of a dispute in accordance with

section 2.3(c), the Draft Financial Statements and the Working Capital Statement (as the may be amended as a result of a resolution or a determination of a dispute in accordance with

Section 2.3(c)) shall become final and binding upon the parties and the Vendor shall deliver to the Purchaser the Closing Date Financial Statements in final form. The Closing Date Financial Statements in final form and the determination of Final Working Capital shall be final and binding upon the parties upon delivery thereof and shall not be subject to appeal. Notwithstanding the foregoing, neither the delivery of the Closing Date Financial Statements in final form, nor the determination of Final Working Capital shall limit or affect any rights or causes of action any party may have with respect to the representations, warranties, covenants and indemnities contained in this Agreement. (

e) The fees and expenses of the accountant in preparing the Draft Financial Statements, the Working Capital Statement and the Closing Date Financial Statements, in final form, shall be borne by the Vendors. The Vendors and the Purchaser shall each bear their own fees and expenses in reviewing the Draft Financial Statements and Working Capital Statement and in reviewing any tax returns which are required to be filed upon the change of control of the Corporation and, if applicable, in presenting their respective cases to the Accountant.

The fees and costs of the Accountant shall be borne equally as between Vendors and the Purchaser, unless otherwise apportioned between them by the Accountant. 9.10 No Waiver No consent or waiver, express or implied, by any party to or of any breach or default by any other party in the performance by the other party of its obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other breach or default in the performance of obligations by such party hereunder.

Failure on the part of any party to complain of any act or failure to act of any other party or to declare any other party in default, notwithstanding how long the failure continues, shall not constitute a waiver by such party of its rights hereunder. 9.15 Time of Essence Time shall be of the essence of this Agreement and of every part hereof. Facts [ 6 ] The evidence before the Court on the application consisted of the Affidavit of Paul Nault, sworn May 27 th , 2011 and the Affidavit of Erik Horne, sworn October 13 th , 2011.

Paul Nault was cross-examined on his Affidavit, on July 20 th , 2011, and the transcript as well as his answers to undertakings arising were filed with the Court. [ 7 ] The closing date for both the Share Purchase Agreement and the Non-Competition Agreement was January 30 th , 2009. On that date, the shares and share-holders loans were transferred and Five Hundred Thousand ($500,000.00) was paid to the Vendors.

Aside from a One Hundred Thousand ($100,000.00) hold-back, Four C’s was required under the Share Purchase Agreement to pay a deferred amount in 2 instalments of Three Hundred Thousand dollars ($300,000.00) on the first anniversary of the closing date, namely January 30 th , 2010 and a further deferred amount on January 30 th , 2011, each amount calculated according to the terms of the Share Purchase Agreement. [ 8 ] The essence of the Naults’ claim surrounds the Contingent Payments, including the process and timing of their calculation.

The Naults allege a breach or material default concerning the Contingent Payments entitling them to a declaration that they are no longer bound by the restrictions in the Non-Competition Agreements. [ 9 ] The Contingent Payments were to be calculated in accordance with

section 2.6 of the Share Purchase Agreement set out above in respect of both the First Measurement Period, the twelve-month period and the January 31 st , 2010 and the Second Measurement Period, the twelve-month period and the January 31 st , 2011.

[ 10 ] As can readily be seen by referring to

section 2.6, an “amount equal to thirty-three (33%) percent of the amount by which the net after-tax earnings of the Corporation for each period, determined in accordance with GAAP, exceeds Two Hundred Thousand ($200,000.00)” is subject to a determination based on financial statements and in fact, gave rise to the dispute between the parties. [ 11 ] In the Affidavit of Paul Nault, he swears that on February 15 th , 2010, Stuart Kudrick, controller of Casman Group of Companies, including Four C’s, sent him draft financial statements as per s.2.3 of the Share Purchase Agreement and he responded with a verbal notice of objection to the draft financial statements.

He goes on to swear that following his objection and within 15 days of the original draft financial statements being provided to him, Kudrick and he agreed on revised draft financial statements and on February 24 th the “revised draft financial statements that were agreed to were sent to him”. It is obvious from the exhibit that what was being transmitted and reviewed in both instances was a document entitled “RCI Electrical Services Ltd. Income Statement For the Period ending January 31 st , 2010". [ 12 ] The first Income Statement for the period ending January 21 st , 2010 showed a net income of $447,819.

The revised Income Statement showed a net income of $478,288.

The Naults have taken the position that the accurate Contingent Payment should be based on a net income of $478,288, that is 33% of $278,288 or $91,835.04. [ 13 ] During cross questioning, Paul Nault admitted he knew that there would be year end adjustments and that he knew in February that Meyers Norris Penny (“MNP”), chartered accountants, would be preparing those as part of a complete set of financial statements to be done in accordance with GAAP (generally accepted accounting principles). [ 14 ] On April 23 rd , 2010, the 2010 Financial Statements prepared by MNP, dated March 25, 2010, were forwarded to the Naults.

No Contingent Payment Statement was provided to the Naults at that time. The Naults objected to the Financial Statements upon their receipt and requested supporting information on April 28 th , 2010. That information was not provided to the Naults until June 4 th , 2010. [ 15 ] On August 13 th , 2010, the Naults wrote to Four C’s indicating that it was in breach for failing to provide the calculations for the 2010 Contingent Payment, and for failing to follow the process set out in the Share Purchase Agreement. The Naults also requested additional supporting documentation in respect of the financial statements.

Correspondence by e-mail and otherwise ensued throughout the remainder of 2010 between Angela Nault and Four C’s. [ 16 ] On August 17 th , 2010 Four C’s instructed the Naults to communicate directly with its lawyer. On October 13, 2010, the lawyer indicated the supporting documentation requested by the Naults would be made available for review by the Naults in Fort McMurray, Alberta. The Naults at this time resided in Victoria, British Columbia. [ 17 ] The position of the Naults was that the Contingent Payment Statement was not provided on time, nor was it accompanied by the required supporting documentation.

Similar facts exist with respect to the second measurement period, in that sixty (60) days past January 31 st , 2011 came and went without a Contingent Payment Statement, resulting in the Naults providing Four C’s with a Written Notice of Breach on April 7 th , 2011. The MNP Financial Statements, dated May 31 st , 2011 (for the Second Measurement Period) were provided to the Naults on June 3 rd , 2011.

On June 21 st , 2010, Four C’s sent to the Naults a Contingent Payment Statement for the Second Measurement Period. [ 18 ] The Share Purchase Agreement also contained two other clauses of significance which the Naults rely on, namely a “Time of the Essence Clause” and a “No Waiver Clause”. They are set out under the provisions of the Share Purchase Agreement stated above. [ 19 ] During oral argument, the Court questioned counsel as to the term of the Non-Competition Agreements.

The term of Angela Nault’s Non-Competition Agreement expires January 30 th , 2011, so that a declaration in respect of her agreement would be moot as of and after that date. With respect to Paul Nault, counsel agreed that his Non-Competition Agreement did not expire three years after the closing date of January 30 th , 2009, because of the provisions relating to his Consulting Agreement and the definition of “Period” quoted above.

His Non-Competition Agreement, by its terms, extends to three years from the expiry or termination of the Consenting Agreement which counsel advised has a significant time span left in it.

Issues [20] The first issue is whether Four C’s was in breach of or in material default of any term of the Share Purchase Agreement, so asto entitle the Naults to a declaration that that Non-Competition Agreements no longer apply to restrict their ability to compete. A secondissue is, even if the Court finds a breach or material default, as asserted by the Naults, should the Court exercise its discretion in grantinga Declaratory Judgment. The Position of the Applicants [21] The Naults point to five breaches of the Share Purchase Agreement as follows: 1.

Failing to provide a Contingent Payment Statement and all relevant and supporting detail within 60 days of the end of the firstmeasurement period; 2. Failing to provide a Contingent Payment Statement and all relevant and supporting detail within 60 days of the end of the secondmeasurement period; 3. Failing to provide the Vendor’s representative and his accounting advisors with access to all of the Corporation’s accounting booksand records and appropriate personnel relating to the Corporation; 4.

Failing to co-operate fully with the Vendor’s representative and his accounting advisors to the extent required to verify the accuracy,presentation and other matters relating to the preparation of the Contingent Payment Statements; 5.

Failing to expeditiously and in good faith in attempting to resolve the dispute within a further period of 15 business days after the dateof notification of the dispute by the Naults in respect of the financial statements/Contingent Payment Statements. [22] The Naults also take the position that whether the breaches are characterized as “mere” breaches or a material default, that theconduct of Four C’s satisfies the criteria for each. In this regard, the Naults refer to Guarantee Company of North America v.

GordonCapital Corporation, (SCC), [1999] 3 S.C.R. 423 at paragraph 49 for the proposition that the accepted common lawdefinition of “material breach” is a breach that is substantial or goes to the root of the contract. The Naults also reference the time of theessence clause referred to above and state that, by the parties including this clause in the Share Purchase Agreement, they acknowledgethat any deviation from the time lines are substantial going to the root of the contract and rely on 1473587 Ontario Inc. v. Jackson (2005)74 O.R. (3d) 549, (Ont. S.C.), aff’d (2005) (ON CA), 75 O.R. (3d) 484, (Ont. C.A.).

The Naults point to the decisionof Rutherford, J. in that case at paragraph 19 where he stated: [19] How more clearly could contacting parties make conditions as to the timing of performance essential than by simply saying, time inall respects shall be of the essence of this agreement?

In my opinion, the provisions in clauses 21 and 22 of this agreement, drawn as itwas by a professional agent of Loblaw and entered into by sophisticated people of business acumen, clearly signaled that any breach ofany of the obligations in the agreement calling for performance at a specified time amounted to the breach of an essential element of thecontract. ... [23] Further, the Naults cite Digger Excavating

(1983) Ltd. v. Bowlen, 2001 ABCA 214 where the Alberta Court of Appealconsidering a time of the essence clause in a real estate purchase contract and indicated that where the parties have stipulated that time isof the essence, generally courts will not assist the party which has failed to perform on time, absent relevant misconduct by an innocentparty, or waiver. The Naults go on to say there was no relevant misconduct by the Naults and with respect to waiver, they point to the

“no waiver” clause referenced above. The Naults further state that adequate notice of a breach was given, that there was no remedying of the breach within five days of the written notice and that they are therefor entitled to the declaration being requested. Position of the Respondent [ 24 ] Four C’s has argued that the Non-Competition Agreements did not include a “no waiver” or “time of the essence” clause.

In addition, Four C’s stated that with respect to the first measurement period there was the “usual delay” by their accounting firm, MNP, in preparing materials in accordance with GAAP and making any necessary year end adjustments. Therefore, the 2010 financial statements were not finalized until March 25 th , 2010 and immediately thereupon they were forwarded to Angela Nault for approval.

Four C’s did not prepare a formal Contingent Payment Statement pending acceptance of the 2010 financial statements by the Naults and takes the position it stood ready, willing and able to pay the sum of $15,984.26 as of April 23 rd 2010. [ 25 ] Four C’s repeats many of the facts stating that the conduct of Four C’s was reasonable in terms of answering questions regarding the financial statements and providing back-up documentation.

Four C’s refers to the inability of the Naults to attend at the offices in Fort McMurray to obtain the requested accounting information and point out that the Naults “have refused” to accept the invitation to review the requisite accounting information, thus resulting in an impasse or any agreement on the 2010 financial statements. [ 26 ] With respect to the second measurement period, Four C’s argued that no written notice was provided alleging that the Contingent Payment Statement for the second measurement period was over due or that Four C’s was in breach of its obligation.

Four C’s acknowledge that written notice of a breach was provided by Angela Nault to Four C’s on April 7 th 2011. [ 27 ] Four C’s concedes that Contingent Payment Statement and the relevant supporting information was not provided to the Naults within 60 days of the end of the first measurement period. Four C’s also states that it cannot provide an accurate calculation of the Contingent Payment Statement while the accuracy of the 2010 financial statements is still in dispute.

A similar concession was made by Four C’s with respect to the fact that a Contingent Payment Statement and relevant supporting information was not provided to the Naults within 60 days at the end of the second measurement period. [ 28 ] Four C’s’ argument is that

section 7 of the Non-Competition Agreement means that the breach must be material and cannot mean a “mere” breach. Four C’s points out that the wording of

section 7 ... “shall breach or otherwise be in material default of any term of the Share Purchase Agreement” ... informs the true meaning of the word “breach” as used in the Non-Competition Agreements. Moreover, Four C’s refers to the second part of

section 7 which references remedying ... “such material default within five business days” which reinforces or supports the

interpretation that the breach must be material. Four C’s submitted that the non-delivery of the Contingent Payment Statements cannot be a breach going to the root of the contract nor can the provision of or access to financial information or lack thereof go to the root of the contract. [ 29 ] Four C’s also made several submissions with respect to whether written notice of the alleged breaches was provided by the Naults to Four C’s and posed the question that if they were material breaches were they remedied within five days of such written notice?

On this point, Four C’s references two notices in 2010, the first being April 21 st 2010 when Four C’s received notice from the Naults that it had not provided the Contingent Payment Statement for the first measurement period.

But within five business days of that notice, Four C’s received a Notice of Objection with respect to the 2010 financial statements which were sent by Four C’s to the Naults on April 23 rd 2010 and thus Four C’s stated it was unable to prepare and convey a Contingent Payment Statement due to the Naults’ rejection of the 2010 financial statements. [ 30 ] Four C’s also points out that on July 15 th 2010, it received correspondence from the Naults agreeing that the contract commitments of the Naults including the non-competition covenants would be maintained and that thereby the Naults waived any consequences of the breaches referred to in the first notice or the effects of those breaches. [ 31 ] Four C’s stated that on August 13 th 2010 the Naults sent a notice to Four C’s that it was in breach of its obligations and once again the basis was the Naults did not receive the Contingent Payment Statement within 60 days contemplated by the Share Purchase Agreement.

Four C’s repeated their argument as to why they were unable to provide the Contingent Payment Statement while the 2010 financial statements remained in dispute.

[ 32 ] With respect to the second measurement period, Four C’s acknowledged that the Naults provided a notice to Four C’s alleging a breach under the Share Purchase Agreement on April 7 th 2011. Four C’s takes the position that the breach, if any, was remedied long before this notice was received by virtue of the open invitation for the Naults to attend in Fort McMurray to review the relevant financial information.

Further, Four C’s states that it was not until June 17 th 2011, when the Naults received the 2011 financial statements, that the Naults provided written notice that the Contingent Payment Statement for the second measurement period was overdue. Four C’s refers to this as “the fourth notice”. [ 33 ] Four C’s summarizes that any breaches is brought to its attention via the third and fourth notices were remedied within five days of their receipt and that accordingly

section 7 of the Non-Competition Agreements were never “fully triggered to terminate the restrictions” contained in those Agreements. Analysis [ 34 ] A fair overview of the performance of the Share Purchase Agreement discloses that it has been substantially performed. There is no evidence before the Court of any other alleged breaches other than those surrounding the dispute over the Contingent Payment Statements for the first and second measurement periods. The Share Purchase Agreement calls for consideration flowing from the Purchaser to the Vendors in the sum of $1,200,000.00.

This is the “Purchase Price” as defined in the Agreement. The remainder of the evidence of the monetary consideration flowing from the Purchaser to the Vendors consists only of two Contingent Payments. And they are exactly that. That is, they are contingent upon the net after tax profit of the Corporation exceeding $200,000 in each of the two measurement periods in question.

It is plain and obvious that the parties to the Share Purchase Agreement contemplated payments subsequent to closing and in addition to the deferred amounts but these payments were solely dependent upon the profitability of the Corporation. [ 35 ] Turning to the

interpretation clause 7 of the Non-Competition Agreements set out above, I agree with the

interpretation submitted by Four C’s. The proper construction of that clause is that the breach must be material or go to the root of the contract. [ 36 ] It is difficult to accept that non-compliance by either side with paragraph 2.6 of the Share Purchase Agreement, or more particularly, failure to comply on time, is a material breach. [ 37 ] I conclude that there were no material breaches, that is, breaches going to the root of the contract in this case. There is no suggestion that Four C’s ignored or failed to comply with clause 2.6 in its entirety.

Rather, the alleged breaches surround providing a Contingent Payment Statement within the time referenced. The real dispute between the parties stems from the determination of the net after tax profit of the Corporation for the years ended January 31 st , 2010 and January 31 st , 2011. The resolution of that dispute ought to have followed the dispute resolution mechanism stated in clause 2.3(

c) of the Share Purchase Agreement. In other words, the matter should have been submitted to PriceWaterhouseCoopers in Edmonton for a final determination of the net profit for each of the years in dispute. None of the parties referred to that dispute resolution mechanism specifically in their argument nor was it raised in any of the evidence before the Court. [ 38 ] Even if I am wrong in terms of my

interpretation of clause 7 stated above that the breach must be material going to the root of the contract, the

interpretation of the waiver provision set forth above is not as submitted by the Naults. In essence, the clause says that there can be a consent or waiver by any party, to a breach or default by any other party and that that consent or waiver can be expressed or implied.

The recognition of the ability to waive is the foundation for the concept that the consent to, or waiver of, one breach cannot be deemed or interpreted to be a consent or waiver to any other breach. [ 39 ] In the context of what happened here, when the Contingent Payment Statement was not delivered by Four C’s to the Applicants within 60 days of the closing date in respect of the first or second measurement periods, assuming a material default had occurred, I find that the Naults waived compliance with that breach or material default given that they gave notice of the breach and given that the breach was ultimately remedied. [ 40 ] The Court also finds that it is an unreasonable

interpretation to suggest that a material breach includes not providing a Contingent Payment Statement on time when a financial statement showing the net profit of the Corporation was delivered to the Naults, after which they disputed the accuracy of them. It is obvious that Angela Nault knew how to calculate what was allegedly owed to the

Naults as a Contingent Payment. As stated above, she took the net after tax profit on the February 24 th , 2010 Statement, subtracted $200,000 and then calculated one-third of the excess over $200,000 to get the figure of $91,835.04. [ 41 ] I find that there was no breach or material default which was not waived or consented to, or which remained unremedied which would entitle the Naults to a declaration that the restrictions in the Non-Competition Agreements are of no force or effect.

Having so concluded, it is not necessary for me to determine whether I would exercise my discretion to grant a declaratory judgment in any event. [ 42 ] Absent an application based on unusual circumstances, the costs of this application, including all steps in it, should follow the event and will be awarded in favour of Four C’s pursuant to column 1 of

schedule C of the Alberta Rules of Court . The parties may speak to the Court, if necessary, on the issue of costs. Heard on the 29 th day of November, 2011. Dated at the City of Calgary, Alberta this 9 th day of January 2012. Neil Wittmann C.J.C.Q.B.A. Appearances: Mark M. Kirwin, Kirwin LLP Ms. K. Davis for the Applicants Thomas V. Duke, Miller Thomson LLP Mr. B. Ho for the Respondent