Alberta Treasury Branches v. McKinnon, 2013 ABQB 371

Court of Queen ’ s Bench of Alberta Citation: Alberta Treasury Branches v. McKinnon, 2013 ABQB 371 Date: 20130916 Docket: 1204 00590 Registry: Grande Prairie Between: Alberta Treasury Branches Plaintiff - and - Bradley McKinnon Defendant _______________________________________________________ Memorandum of Decision of the Honourable Madam Justice J.B. Veit _______________________________________________________

Summary [ 1 ] Does a printed, but unsigned, Alberta Treasury Branch Credit Card Agreement handed to a customer together with a MasterCard and a signed Express Loan Credit Agreement for a maximum of $20,000.00, which does not refer explicitly to the Credit Card Agreement, effectively satisfy the Limitations Act requirement that any contracting out of the 2 year limitation period must be “ signed by the person affected ” , thereby allowing

summary judgment on an ATB claim brought outside the 2 year limitation period? [ 2 ] Mr. McKinnon appeals a decision of the Master which allowed the ATB to substitute a contractual limitation for the statutory one, even though the document extending the limitation period was not signed by Mr. McKinnon.

[3] ATB cross-appeals the decision because the Master limited the

summary judgment to the debt owed by Mr. McKinnon asof July 29, 2008 when Mr. McKinnon states that he attended at the ATB premises and instructed ATB employees to cancel the creditcard and close the account. [4] Mr. McKinnon’s appeal is allowed: the Master’s granting of

summary judgment is set aside and a trial ordered. [5] The standard of review on an appeal of a decision of a Master is correctness, as to issues of law, mixed fact and law andfact. [6] Here, the Master’s articulation of the general requirements to establish

summary judgment was correct: [7] The Master was also correct in stating that, where a statute such as the Limitations Act, requires a contract to be in writingand signed, the plaintiff is not required to prove that every document which contains the required terms be in writing and signed. Thelaw allows unsigned documents to be incorporated by reference into signed contracts. [8] However, the application of the law allowing incorporation of one document into another is complex. That complexity ishighlighted where, as here, the applicable statute is explicitly remedial.

The application of the law of incorporation may, for example,require clearer notice of a term where a term is considered to be harsh. It may be that the extension of a statutory 2 year limitation periodto 6 years would be considered harsh, at least in the context of remedial legislation limiting the limitation period to 2 years, and wouldtherefore require some notification greater than notification in an unsigned document that such an extension is contained in a thirddocument.

Indeed, reliance on incorporation by reference may call into question the very notion of consensus ad idem, or whether theconsumer actually agreed to the extension of the limitation term. [9] The Master may well have considered all of those issues, but, from his reasons for decision, it is not possible to discern theview which he had formed of the applicable law of incorporation by reference in the situation here. Therefore, the Master’s decisioncannot be characterized as correct. [10] Mr.

McKinnon’s appeal is therefore allowed, and the matter remitted for trial. [11] In light of the decision taken on the McKinnon appeal, it is not necessary to consider the ATB cross-appeal. [12] For those reasons, the granting of

summary judgment is set aside and the matter is remitted for trial. Cases and authority cited [13] By Alberta Treasury Branches: Court of Queen's Bench Act, R.S.A. 2000, c. C-31, s. 12; Alberta Rules of Court, Alta.Reg. 124/2010, Rule 7.3; Janvier v 834474 Alberta Ltd., 2010 ABQB 800; Bahcheli v Yorkton Securities Inc., 2012 ABCA 166; Kwanv Superfly Inc., 2011 ABQB 343; Tottrup v.

Clearwater (Municipal District) No. 99, 2006 ABCA 380; Terrace Consulting Inc. vJackson, 2011 ABQB 108; Ko v Hillview Homes Ltd., 2012 ABCA 245; Royal Bank of Canada v Sanduga, 2001 ABQB 532;Marathon Canada Limited v Enron Canada Corp., 2009 ABCA 31; 652013 B. C. Ltd. v Kim, ; Gill v Red RiverCooperative Ltd., 2007 MBQB 22; Royal Bank v Persaud, ; Queen v Cognos, (SCC), [1993] 1 SCR87; Bevan v Anderson and Peace River Sand & Gravel Co. Ltd., [1957] AJ No. 76; McKenzie v Dwight, [1885] OJ No. 112; L.K.

Oil &Gas Ltd. v Canalands Energy Corporation, 1989 ABCA 153; Xerex Exploration Ltd. v Petro-Canada, 2003 ABQB 746; Bank of Nova Scotia v Drouillard-Potter, ; ClBC Mortgage Corp. v Beck, ; Hawrish v Bank ofMontreal, (SCC), [1969] SCR 515; Woodridge Lincoln Mercury Sales Ltd. v Paramount Towing Ltd., 2000 ABCA147; Troika Land Developments Corp. v West Jasper Properties Inc., 2009 ABQB 590; Kendell v Kendell, 2006 ABQB 664; Ahone v Holloway, (BC CA); Gainers Inc. v Pocklington Financial Corporation, 2000 ABCA 151; Ziegler v GreenAcres (Pine Lake) Ltd., 2013 ABQB 349; Stevenson v Reliance Petroleum Ltd., (SCC), [1956] SCR 936 at 953; GeoffR.

Hall, Canadian Contractual

Interpretation Law, 2nd ed. (Toronto: LexisNexis, 2012); Crawford v Morrow, 2004 ABCA 150;

Nexxtep Resources Ltd. v Talisman Energy Inc., 2013 ABCA 40; Condominium Property Act, RSA 2000; Child, Youth and FamilyEnhancement Act, RSA 2000, c. C-12; Hunter v Inverness District (School Board), (NS SC); Hibberd v HurricaneHydrocarbons Ltd., 2006 ABQB 707; Triple R Contracting Ltd. v 384848 Alberta Ltd., 2001 ABQB 52; Wyat Corporation v Dosco,2003 ABQB 389; Larsson v 32262 B.C. Ltd., (BC SC); Catre Industries Ltd. v Alberta, 1989 ABCA 243; Limitations Act, RSA 2000, c.

L-12; De Shazo v Nations Energy Company Ltd., 2005 ABCA 241; Canada (Attorney General) vLameman, 2008 SCC 14; Shaver v Co-operators General Insurance Company, 2011 ABCA 367; Hyde v Calgary (City of), 2004ABQB 800; Rodin Law Firm v Pedherney, 2010 ABQB 307; McAndrews v Hames, 2005 ABQB 556; Daniels v Mitchell, 2005 ABCA271; ALRI, Limitations - Report No. 55 (December 1989); Tardif (Estate of) v Wong, 2002 ABCA 121; Brar v Roy, 2005 ABCA 269;Ron Ghitter Property Consultants Ltd. v Beaver Lumber Company Limited, 2003 ABCA 221; G.H.L.

Fridman, The Law of Contract inCanada, 6th ed. (Toronto: Carswell, 2011); Fraser Jewellers

(1982) Ltd v Dominion Electric Protection Co., (CA);American Express Canada Inc. v International Warranty Co. Ltd., 1994 ABCA 38; Karroll v Silver Star Mountain Resorts, . (SC); Harvie et al. v Gibbons, 1980 ABCA 38 , [1980] AJ No. 951; Doran v McKinnon, (SCC), [1916] 53 SCR 609; Morgan Trust Company of Canada v Falloncrest Financial Corporation, (CA);Halsbury's Laws of England, vol 9, 4th ed. (London, UK: Butterworths, 1980); Frankie Tomatto's Woodbine Inc. v Moneris SolutionsCorporation, (SC); Dell Computer Corp. v Union des consommateurs, 2007 SCC 34; S.M.

Waddams, The Law ofContracts, 5th ed. (Toronto: Canada Law Book); U.B.C. v The Association of Administrative and Professional Staff on Behalf of BillWong, 2006 BCCA 49l; Nareerux Import Co. Ltd v Canadian Imperial Bank of Commerce, 2009 ONCA 764; Bank of Montreal v Demakos, (SC); Andrews v Calori, (SCC), [1907] 38 SCR 588; Ronald C.C. Cuming & Roderick J. Wood, Alberta Personal Property Security Act Handbook, 4th ed. (Toronto: Carswell, 1998); Alberta (Treasury Branches) v Faja Bison Ranch Inc., (AB KB),[1994] AJ No. 86; Capital Plymouth Chrysler Inc. v.

Euro Sport Auto Sales Ltd., 1998 ABQB 449; Andrews v General AccidentAssurance Company of Canada, 1995 ABCA 46; Tilden Rent-A-Car Co. v Clendenning (1978), (ON CA), 83 DLR(3d) 400 (ONCA); Budget Rent A Car of Edmonton Ltd. v University of Toronto, 1995 ABCA 52; McAteer v DevoncroftDevelopments Ltd., 2001 ABQB 917; 32262 B. C. Ltd. v Besler, 2000 ABQB 75; Ocsko v Cypress Bowl Recreations Ltd., (BCCA); J. Nunes Diamonds Ltd. v Dominion Electric Protection Company (SCC), [1972] S.C.R. 769; Feldthusen, Economic Negligence: The Recovery of Pure Economic Loss, 5th ed., Thomson Carswell. [14] By Mr.

McKinnon: Tercon Contractors Ltd. v British Columbia (Minister of Transportation & Highways), 2010 SCC 4;Fair Trading Act, RSA 2000, c P-2; R. v Kreft, 2006 ABPC 258; Brown v Graul, 2006 ABPC 359; Alberta Law Reform Institute,Limitations Act: Standardizing Limitation Periods for Actions on Insurance Contracts, Final Report No. 90 (August 2003);GuaranteeCo. of North America v Gordon Capital Corp., (SCC), 1999 CarswellOnt 3171; Moojelslry v Rexnord Canada Ltd.,1989 CarswellA1ta 295 (QB); Chapman v Kopitoski, 1972 CarswellSask 88; Alberta Rules of Court, AltaReg. 124/2010; LimitationsAct, RSA 2000, c.

L-12; Canada (Attorney General) v Laneman, 2008 SCC 14; Royal Bank v Levy, 2012 ABQB 310; SharbernHolding Inc. v.Vancouver Airport Centre Ltd., 2011 SCC 23; Raypath Resources Ltd. v TD Bank, 1996 CarswellAlta 343; McLean vRoyal Bank of Canada, 1998 ABCA 163; Goddard v R., 2001 FCT 1248; Hercules Managements Ltd. v Ernst & Young, (SCC), 1997 CarswellMan.198 (SCC); Halushka v Canada (Attorney General), 2003 ABCA 262; Alberta Treasury Branches vMacLeod Dixon, 2001 ABQB 73;

Interpretation Act, RSA 2000, c.

I-8; Grenier v Alberta (Minister of Infrastructure), 2006 ABQB 917; Ironside v Smith, 1998 ABCA 366; Alberta Rules of Court,Alta Reg. 124/2010; Bahcheli v Yorkton Securities Inc., 2012 ABCA 166; De Shazo v Nations Energy Company Ltd., 2005 ABCA241; Murphy Oil Company Ltd. v Predator Corporation Ltd., 2006 ABCA 69; Quadrangle Holdings Ltd. v Coady, 2012 ABQB 22;Canada (Attorney General) v Laneman, 2008 SCC 14; Hyde v Calgary (City of), 2004 ABQB 800; Tardif (Estate of) v Wong, 2002ABCA 121; Ordon Estate v Grail, (SCC), 1998 CarswellOnt 4390 {SCC); McAndrews v Hames, 2005 ABQB 556;Deboer v Darryl J.

Raymaker Professional Corp., 2004 ABCA 326; Continental Bank of Canada v R., (SCC), 1998CarswellNat 1496 (SCC); Canada (Attorney General) v Becker, 1998 CarswellAlta 802 (Alta CA); Ironside v Smith, 1998 ABCA 366;Bowes v Edmonton (City), 2007 ABCA 347; Morgan Trust Co. of Canada v Falloncrest Financial Corp., 2006 CarswellOnt 7255 (OntCA); Re Barrett (Estate of), 2003 ABQB 986; Nelson Lumber Co v IWA, Local 1-207, 1980 CarswellAlta 580, (Alta Arb); Paulson vMurray, 1922 CarswellMan 58 (Man. KB);Yawrenko v. Boyle, 1999 ABQB 278; Southern Manitoba Potato Co. v Pepsi-Cola,Canada, 2008 CarswellOnt 4259 (Ont.

CSJ); Boutchev v. DHL International Express Ltd., 2001 CarswellAlta 351. [15] By the court: Girouard v Druet 2012 NBCA 40; Canadian Imperial Bank of Commerce v Titus [10980] O.J. No. 3456; Fauzi Elias v George Sahely & Co. (Barbados) Limited [1982] 3 All E.R. 801, [1983] A.C. 646; Combined Air Mechanical ServicesInc. v Flesch 2011 ONCA 764; Xerox Canada Limited v Vandesign Graphic Ltd. 2010 BCSC 1039; Bowes v Edmonton (City) 2007ABCA 347 Appendix A: Extract from the reasons of the Master

Appendix B: Copy of p.2 of signed Express Loan Credit Agreement Appendix C: Copy of p. 2 of unsigned Agreement Terms and Conditions Appendix D: Copy of fourth page of unsigned ATB Financial Business MasterCard Cardholder Agreement (Agreement) (sic) 1. Background

a) Factual and procedural background [ 16 ] In May, 2007, Brad McKinnon and Debrah Kostenuk opened an account with Alberta Treasury Branches for a business in which they were partners, Deb ’ N ’ Brad Contracting. Both signed an ATB Express Loan Credit Agreement dated May 9, 2007 and having a maximum credit line of $20,000.00; along with the Credit Agreement, they were also provided with a printed document entitled Agreement Terms and Conditions.

As part of their banking arrangement, they also obtained an ATB Business MasterCard; on the same day as they signed the credit agreement and obtained the MasterCard, they were also provided with a printed document entitled ATB Financial Business MasterCard Cardholder Agreement (Agreement) (sic) [ 17 ] It is a term of the signed Express Loan Credit Agreement, under the heading “ Other Conditions ” , that both Mr. McKinnon and Ms.

Kostenuk agreed to “ be bound by the Terms and Conditions attached to and forming part of this Agreement ” . [ 18 ] It is a term of the unsigned Agreement Terms and Conditions document that, if ATB issues a credit card to the persons signing the Express Loan Credit Agreement, those persons “ agree to abide by the Cardholder Agreement provided with the Card. . . .

Signing, using or accepting the Card will constitute acceptance of the terms of the Cardholder Agreement ” . [ 19 ] In addition, the Credit Agreement provided the conditions under which either the ATB or the defendants could terminate the arrangement. [ 20 ] There is no evidence suggesting that the three documents referred to above were stapled together or somehow bound together. [ 21 ] Mr. McKinnon swears that, on July 29, 2008, he went into the ATB branch and instructed ATB employees to close the business account and to cancel the business credit card and received assurance that this would be done.

At that time, there was an outstanding balance of approximately $15,000.00 on the credit card. [ 22 ] Debrah Kostenuk continued making some small purchases on the credit card after July 29, 2008. Mr. McKinnon swears that he had no notice of Ms. Kostenuk ’ s use of the credit card. Ms. Kostenuk was assigned into bankruptcy on November 11, 2008. Mr. McKinnon acknowledges that although Ms.

Kostenuk made some use of the credit card after July 29, 2008, the main reason why the credit card debt is now approximately $30,000.00 is not post-July 29, 2008 purchases, but is rather due to post-July 29, 2008 interest on the $15,000.00 balance as at July 29, 2008. [ 23 ] On March 3, 2010, ATB issued a demand to Mr. McKinnon for repayment of the entire outstanding balance on the credit card. On March 11, 2010, Mr. McKinnon advised ATB that he was not responsible for any debts incurred after July 29, 2008 because ATB did not follow his instructions.

Nor has any other evidence been led of any acknowledgment by Mr. McKinnon of a debt to ATB.

[ 24 ] On July 30, 2012, that is well past the 2 year limitation for commencing such actions, ATB sued Mr. McKinnon for the amount outstanding on the credit card. In so doing, ATB relied on the Cardholder Agreement which purports to replace the statutory limitation with a contractual limitation period of 6 years. The Limitations Act states that any such contractual provision must be signed by the person against whom the expanded limitation is used; although Mr.

McKinnon did not sign the Cardholder Agreement contained the limitation shield ATB argues that the Cardholder Agreement was incorporated by reference into the Credit Agreement which was signed by Mr. McKinnon. [ 25 ] Invoking a limitations defence, Mr. McKinnon applied to the Master for

summary dismissal of ATB ’ s claim. Invoking the law which states that where it is plain and obvious or beyond doubt that there is no defence to a claim, a plaintiff is entitled to

summary judgment, ATB cross-applied to the Master for

summary judgment of the full amount of approximately $30,000.00 against Mr. McKinnon. [ 26 ] The Master denied Mr. McKinnon ’ s application and granted ATB ’ s application in part: the Master concluded that the only triable issue was whether Mr. McKinnon was responsible for charges incurred after July 29, 2008. See the extract from the Master ’ s decision reproduced as Appendix A. [ 27 ] On the cross-applications before the Master, Mr. McKinnon filed an affidavit on March 14, 2013 in which he acknowledged receiving an ATB MasterCard and an ATB Financial Business MasterCard Cardholder Agreement.

However, he swore that the ATB employees did not go over the terms of either the Cardholder Agreement or the Agreement Terms and Conditions document with him. He added, specifically, that ATB employees made no reference to the extension of the statutory limitation period. In the affidavit material which it filed before the Master, ATB did not challenge Mr. McKinnon ’ s sworn evidence in relation to the way in which ATB employees presented the relevant documents to him. [ 28 ] Both Mr. McKinnon and ATB appeal the Master ’ s decision to this court.

b) Legislative background [ 29 ] Alberta ’ s Limitations Act explicitly refers to its remedial nature: s. 2 . [ 30 ] The Act explicitly allows parties to agree to extend the statutory limitation period: Agreement 7(1) Subject to

section 9, if an agreement expressly provides for the extension of a limitation period provided by this Act, the limitation period is altered in accordance with the agreement.

(2) An agreement that purports to provide for the reduction of a limitation period provided by this Act is not valid. RSA 2000 cL-12 s7; 2002 c17 s4 [ 31 ] However, it does impose certain requirements on such contractual variations: Persons affected by exceptions for agreement, acknowledgment and part payment 9(1) An agreement and an acknowledgment must be in writing and signed by the person adversely affected .

(2) An agreement made by or with an agent has the same effect as if made by or with the principal.

(3) An acknowledgment or a part payment made by or to an agent has the same effect as if it were made by or to the principal.

(4) A person has the benefit of an agreement, an acknowledgment or a part payment only if it is made (

a) with or to the person, (

b) with or to a person through whom the person derives a claim, or (

c) in the course of proceedings or a transaction purporting to be pursuant to the Bankruptcy and Insolvency Act (Canada) .

(5) A person is bound by an agreement, an acknowledgment or a part payment only if (

a) the person is a maker of it, or (

b) the person is liable in respect of a claim (

I) as a successor of a maker, or (ii) through the acquisition of an interest in property from or through a maker who was liable in respect of the claim. 1996 cL-15.1 s9 (Emphasis added) 2. Standard of review [ 32 ] The parties agree that the standard of review on this appeal from the Master, “ on all issues ” is correctness: Bahcheli . I agree. That Court of Appeal decision states that, in appeals from a Master, in addition to appeals based on an alleged error of law, appeals based on both errors of fact and errors of mixed fact and law are also both based on correctness In this respect, Alberta case law relating to a Master ’ s decision on

summary judgment may appear different from Ontario case law, for example Combined Air . However that difference is explained by the Alberta Court of Appeal ’ s position on two issues: first, there is the effect of the fact that Alberta Masters are not s. 96 judges (para. 12) and second is the fact that it could be complicated to decide what particular standard of review applied in a particular appeal from a Master (para. 28). I take it then, that a standard of “ correctness ” with respect to factual questions is equivalent to the review standard of palpable and over-riding error.

3. Did the Master articulate the correct test for

summary judgment? [ 33 ] The parties agree, and I agree with them, that

summary judgment is only available where there is no genuine issue for trial. A plaintiff is only entitled to

summary judgment if it has proved every fact necessary to support its claim. A defendant is only entitled to

summary dismissal of the claim against him if it is “ plain and obvious that the action cannot succeed. To justify deciding the matter without trial, the pleadings and evidence must show that the claim has no reasonable prospect of success . . . When faced with a

summary judgment application of this type the court must ascertain whether there are undisputed facts that necessarily lead to the conclusion that it is plain and obvious the plaintiff ’ s claim is statute barred ” : de Shazo , at paras. 17-19. [ 34 ] The Master made no error in articulating the test which applies on motions for

summary judgment: In this type of application, the ATB is required to demonstrate that it ’ s plain and obvious or beyond doubt that there ’ s no defence to the claim or part of it. And for his part, the defendant, Mr. McKinnon, in order to succeed on his application would have to demonstrate that it ’ s plain and obvious or beyond doubt that there is no merit to the claim advanced by the ATB: see Appendix A. 4. Was the Master correct in concluding that it is beyond legal and factual doubt that the document that was not signed by Mr. McKinnon was incorporated by reference into the document he did sign?

In other words, is it beyond doubt that the statutory 2 year limitation period does not apply to ATB and that, instead, ATB has the benefit of a 6 year limitation period? [ 35 ] What is beyond doubt with respect to limitations is that ATB began its action outside the 2 year statutory limitation period. Therefore, unless the ATB has successfully replaced the statutory limit with a more generous contractual one, ATB ’ s claim is out of time. [ 36 ] Here, Mr.

McKinnon did not sign a written document which itself extended the limitation period. [ 37 ] Clearly, therefore, one issue that had to be decided by the Master was whether the written document signed by Mr. McKinnon could be said to have incorporated another document which did contain an extension of the limitation period. On this issue, as can be seen from Appendix A, the Master said: Mr. McKinnon has argued that he would be obliged in order to give effect to

section 7 and 9 of the Limitations Act to have signed all of the documents provided to him when the credit facility was granted. He did sign the document called express loan credit agreement which incorporates, by reference, a set of terms and conditions to the agreement; and these were provided to him. And the agreement terms and conditions go on to refer to the ATB MasterCard cardholder agreement which was also provided to Mr. McKinnon when the credit facilities were obtained.

Insofar as the limitations defence is concerned, I am satisfied that the evidence sufficiently incorporates by reference the ATB MasterCard cardholder agreement and the other provisions relating to the extension of the limitation period such that

section 7 and 9 of the Limitations Act are satisfied. I have some difficulty with the idea that the lender would be required to specifically bring each and every clause that they might rely on at some point in the future to the attention of the borrower. In this case, the documents were physically provided. The borrower could have read them. They aren't written in particularly fine print as legal documents go. And from my reading of them, the language is quite accessible.

a) What law governs incorporation by reference into contracts? [ 38 ] The Limitations Act does not itself establish any requirements for the process of incorporation of unsigned agreements to extend the statutory limitation period into signed documents.

We are therefore required to rely on basic principles of contract. [ 39 ] Undoubtedly because of the way that the issue was argued before him, the Master did not articulate the legal standard for incorporation by reference, did not discuss the affidavit evidence concerning the interaction between the plaintiff and the defendant concerning the cardholder agreement and did not address the issue of whether the remedial nature of the legislation affected the issue of incorporation by reference. Since Mr.

McKinnon only argued that the relevant document should have been signed, the Master really only dealt with that issue.

The Master was obviously correct in holding that, even where there is a requirement that an agreement be in writing, that requirement can be satisfied by incorporation by reference into a document which is signed. [ 40 ] The issue, however, is whether the circumstances in this case satisfy the law allowing incorporation by reference. [ 41 ] General requirements for incorporation by reference were discussed by our Court of Appeal in Harvie : 19 It is also well established that several documents may be connected to each other by reasonable inference, with parol evidence if necessary, to constitute a sufficient memorandum . . . .

Bagallay L.J. says (p. 455): -- "The true principle is that there must exist a writing to which the document signed by the party to be charged can refer, but that this writing may be identified by verbal evidence ." And Thesiger L.J., at p. 456, says: -- "If, however, it appears from the instrument itself that another document is referred to, that document may be identified by verbal evidence. A simple illustration of this rule is given in Ridgeway v.

Wharton ... there "instructions" were referred to: now instructions may be either written or verbal; but it was held that parol evidence might be adduced to show that certain instructions in writing were intended. This rule of

interpretation is merely a particular application of the doctrine as to latent ambiguity. Although parol evidence may be given to identify the document intended to be referred to, it must be clear that the words of the document signed by the party to be charged will extend to the document sought to be identified." (Emphasis added) [ 42 ] In other words, there is Alberta case law which establishes that documents which are not internally linked to one another, as is the case here between the Express Loan Credit Agreement and the Cardholder Agreement, may be linked by testimony.

However, it may be said that the Harvie decision was focussed on corroboration rather than incorporation by reference and that, in any event, the pertinent document in that case which were linked by testimony had each been signed; in the result, that decision may not be authoritative on the issue of what the law requires by way of incorporation when the overarching requirement is that a document be signed. [ 43 ] As decisions such as Girouard demonstrate, the law may impose more onerous standards than mere reference before it is

satisfied that one effective document has been created: 33 The finding that emails may satisfy the writing requirement under the Statute of Frauds and the Electronic Transactions Act leadsus to consider another aspect of the writing requirement. We are not dealing with one email but rather seven. Commentators believe thatthe drafters of the original Statute of Frauds clearly contemplated the inclusion of all the contractual terms in a single document.However, by the beginning of the nineteenth century, courts would allow plaintiffs to rely on two or more documents to prove their caseunder the "joinder" principle.

But it was still necessary that one document should specifically and on its face refer to the other (seeO'Donohoe v. Stammers (1884), 1884 CanLII 4 (SCC), 11 S.C.R. 358). Oral evidence was not permitted for the purpose of connectingthe two: Boydell v. Drummond (1809), 103 E.R. 958 (K.B.). In short, the law required an internal and express reference in one documentto the other. But in the latter half of the nineteenth century, the law became even more accommodating. A sufficient reference could ariseby implication: Timmins v. Moreland Street Property Co. Ltd. (1957), [1958] 1 Ch. 110 (C.A.).

English writers summarize the law interms of the law reports revealing a "progressive laxity of

interpretation": M.P. Furmston, Cheshire, Fifoot and Furmston's Law ofContract, 11th ed. (London: Butterworths, 1986) at 204. 34 The lead Canadian case on the issue of joinder is Doran v. McKinnon (1916), (SCC), 53 S.C.R. 609, [1916]S.C.J. No. 47 (QL). In that case, it was held: "parol evidence may be given to connect two documents together which do not expresslyrefer to each other, but which connection and reference is a matter of fair and reasonable inference" (at 611). The inference drawingpower of judges is significant. The Alberta Court of Appeal applied this principle in Harvie et al. v.

Gibbons, 1980 ABCA 38 ,[1980] A.J. No. 951 (C.A.) (QL). In that case, the Court allowed oral evidence to connect documents where an incomplete reference on acheque was supplemented by a map drawn by the purchaser and an unsigned note of a conversation with the vendor's executrix. Othercourts appear to take a less flexible approach when it comes to the joinder issue: e.g., Canadian Imperial Bank of Commerce v. Titus etal., [1980] O.J. No. 3546 (H.C.J.) (QL) and see cases collected in S.M.

Waddams, The Law of Contracts, 6th ed. (Toronto: Canada LawBook, 2010) at 168, note 60. [44] The Titus decision to which reference is made by the New Brunswick Court of Appeal contains the following commentary: 25 Courts have, in certain circumstances, allowed the "memorandum or note" to be contained in more than one document. 26 In Pearce v. Gardner, [1897] 1 Q.B. 688, the defendant sent a letter which contained all the terms of a contract to the plaintiff. Theletter itself was addressed to "Dear Sir" with no indication to whom it was written.

However, it was presumed by the Court that theenvelope in which the letter had been sent was addressed to that particular plaintiff. The Court ruled that the letter and envelope could betaken together to form a memorandum under the Statute of Frauds. 27 In Doran v. McKinnon et al. (1916), (SCC), 53 S.C.R. 609, 31 D.L.R. 307, the issue was whether the defendanthad accepted a contract on behalf of his partners. A telegram from the defendant to his associates referred to the acceptance of a contracton "our terms".

The Court allowed parol evidence to show that the terms of the contract had been set out in several letters previouslywritten by the defendant. The Supreme Court of Canada held a joinder of these documents was sufficient to produce a memorandumwithin the statute. 28 It is to be noted that in these cases the documents which referred to other writings and which the Court permitted to be incorporatedwere signed by the defendants in each instance. Here, the only document signed by the defendant Sommer was the guarantee not, ofcourse, the covering letter which the plaintiff bank seeks to incorporate. 29 In Timmins v.

Moreland Street Property Co.

Ltd., [1958] 1 Ch. 110, Jenkins, L.J., stated at p. 130: The laying of documents side by side may no doubt lead to the conclusion as a matter of res ipsa loquitur that the two are connected.But before a document signed by the party to be charged can be laid alongside another document to see if between them they constitute asufficient memorandum, there must, I conceive, be found in the document signed by the party to be charged some reference to someother document or transaction. 30 Thus, a document signed by a defendant can only be joined with one not signed by him if the signed document refers to the other.Here, the guarantee, the only document signed by the defendant Sommer, makes no reference whatsoever to any other document ortransaction and, therefore, it cannot be joined to produce a sufficient memorandum to satisfy the statute.

(Emphasis added) [45] Other contemporary Canadian case law also refers to the degree of incorporation that is required. [46] For example, in the Xerox decision: 21 The first question to be determined is what terms the parties have incorporated into their contract. In University of BritishColumbia v. Wong, 2006 BCCA 491, 59 B.C.L.R. (4th) 203 at paras. 30-31, the Court of Appeal commented on incorporation byreference: The appellant also relies on the decision of the Ontario Court of Appeal in R. v. St. Lawrence Cement Inc. (2002), (ON CA), 60 O.R. (3d) 712, 162 O.A.C. 363.

The Court's comments at para. 18 of this case are particularly apt for the consideration ofthe contract in issue in the instant case: [Incorporation by reference] enables the legislative draftsman to include provisions of earlier statutes or other documents into statutes orregulations without actually reproducing the language of the statute or document ... words to which reference is made in an instrumenthave the same operation as if they were inserted in the instrument referring to them ...

The effect of incorporation by reference is that thematerial incorporated is considered to be part of the text of the legislation. Although these comments deal with legislation, they are equally applicable to contracts and other instruments. 22 The plaintiff relies on Tradigrain SA v. King Diamond Marine Ltd., [2000] EWCA Civ 27, [2000] All E.R. (Comm.) 542 at para.78, in which Rix L.J. said: ... The first rule relating to the incorporation of one document's terms into another document is to construe the incorporating clause inorder to decide on the width of the incorporation. ...

A second rule, however, is to read the incorporated wording into the host documentin extenso to see if, in that setting, some parts of the incorporated wording nevertheless have to be rejected as inconsistent or insensiblewhen read in their new context: ... 23 The plaintiff submits that the only issue is whether the incorporation language in the one-page Lease is sufficient to capture theterms and conditions it relies upon.

It claims that there is no requirement that the document incorporated by reference be presented to aparty; it is sufficient if the existence of terms and conditions is referred to and those terms and conditions are capable of being identified.The plaintiff relies on the "ticket" cases, specifically Schuster v. Blackcomb Skiing Enterprises Ltd.

Partnership (1994), (BC SC), [1995] 3 W.W.R. 443, 100 B.C.L.R. (2d) 298 (S.C.), for the proposition that a party is bound by the attachments ifsufficient notice of their existence is given. 24 Kalia does not dispute that a contract may incorporate by reference the terms of an external document provided the contractexpressly states that it is incorporating those terms.

Kalia, however, disagrees with the plaintiff's conclusion that the external documentneed not have been presented as the Lease clearly states that it "incorporates terms and conditions attached hereto" (emphasis added).She submits that this clear and unambiguous wording means only those documents, and the terms contained therein, that are attached tothe agreement are incorporated. In this case, the terms and conditions were not attached to the Lease and she says, as a result, they werenot incorporated into the Lease.

The identified and listed appendices, which relate to matters such as maintenance, equipment andsoftware details, were not attached either. 25 The plaintiff does not dispute that nothing was attached to the one-page Lease. In my view, the wording of the Lease'sincorporating clauses is clear that the only additional terms, conditions or appendices that form part of the Lease are those that areattached at the time it is signed. The Lease specifically states that to be the manner in which additional terms will become a part of the

agreement. [ 47 ] However, there is other contemporary law suggesting that a more generous approach is sometimes appropriate. Having stated that the Timmins decision represents a correct statement of the modern law, a 1982 decision of the Privy Council in Elias went on to find: The first inquiry must, therefore, be whether the document signed by or n behalf of the person to be charged on the contract contains some reference to some other document or transaction. . . . . Parol evidence can, therefore, be given to explain the transaction, and to identity any document relating to it. . . .

Moreover, it would be contrary to the intendment of the Stature of Frauds to limit the rule to cases in which the reference in the signed document must be to a writing intended to have contractual force. The Statute of Frauds is concerned to suppress not evidence but fraud. In seeking a sufficient memorandum it is not necessary to shoulder the further burden of searching for a written contract. Evidence in writing is what the stature requires.

For, as Stead man v Stead man (supra) emphasized, an oral contract for the sale of land is not void but only, in the absence of evidence in writing or part performance, unenforceable. If therefore, a document signed by the party to be charged refers to a transaction of sale, parol evidence is admissible both to explain the reference and to identify any document relating to it. Once identified, the document may be placed alongside the signed document.

If the two contain all the terms of a concluded contract, the statute is satisfied. [ 48 ] The Elias decision illustrates the importance of understanding the specific context in which a document in writing, or a signed document, is required. For example, when dealing with wills, there may be a need for a document signed by the alleged testatrix. In the circumstances here, it is important to assess the policy underpinnings, and possible effect, of the Limitations Act .

b) What law governs the effect of remedial legislation? [ 49 ] As noted in the introduction to the statute in the Background

section above, the Limitations Act is remedial legislation. In other words, it is legislation designed to benefit persons burdened by legal obligations. [ 50 ] In a general way, public policy may be important in determining whether a specific contractual term should be upheld. [ 51 ] More specifically, where legislation, such as the Limitations Act is characterized as remedial, case law requires that a court fairly, broadly and liberally construe such legislation so as to give effect to its objects. Our Court of Appeal recently dealt with the specific objects of limitations legislation in Bowes . In that case, none of the members of the panel disagreed with C ô t é J.A. ’ s

interpretation of the purpose of limitations legislation: Many trial-level cases try to interpret limitations legislation so that no reasonable plaintiff is ever harmed, or could be. Indeed, some cases hint that barring any suit good (or arguably good) on its merits is improper. 118 We must start by recalling the main purpose of limitations legislation. It is enacted to prevent certain plaintiffs from suing on good causes of action. If pressed to trial, poor causes of action will not likely succeed on the merits; they will be dismissed. 119 What is the policy reason for barring such suits?

To eliminate the harm to defendants of very belated litigation. Most of that harm divides into two categories. 120 First, people and businesses have to get on with their lives. They should not have to store bulky or fragile records forever, even for decades. Their savings and futures should not be founded on fading memories, or the hazard of whose witness first dies or disappears. The social cost of all that is high. People and businesses must be able to plan their affairs without keeping idle huge reserves against the possibility of ancient claims arising.

No one would buy a construction business or a professional practice if it might drag with it claims over 30 years old. Indeed, Canadians daily use buildings, bridges, dams, roads, and railways a century or more old. Companies depend on constituting documents drafted by long-forgotten solicitors. Wills and trusts generations old govern pensions plans and other vast sums. Many Canadians were delivered by obstetricians over 65 years ago; and got medical advice over 60 years ago.

121 With no limitation periods, much of the country's assets, infrastructure, and capital would be sterilized by the dead hand of history. See Alberta Law Reform Institute, Limitations 1-2, 70 (Report #55, December 1989). 2. Lost Evidence 122 The second aspect of the harm is that trying to find and test evidence about events decades old is usually roulette, not a serious exploration of the truth.

After some years, a defendant cannot prove a proper defence, or even disprove the plaintiff's allegations. 123 People sometimes argue that loss of evidence tends to harm plaintiffs more than defendants; but that makes it no less of a gamble. In any event, the suggestion that delay hurts plaintiffs more than defendants is facile. A plaintiff need only make out a prima facie case. Sometimes that is easy.

"I invested with you $10,000 and you did not repay it," or "You failed to diagnose my undoubted fractured hip", or "You designed and built my house and it just fell down." A defendant sued usually has the onus of proving all the facts necessary for an excuse, or to prove that he used due diligence. If the defendant has no records, it does not know what steps its employees took, or even who they were. Even if the witnesses are still alive and living in retirement, any defence is hopeless.

The bare-bones prima facie case prevails. [ 52 ] An inquiry may therefore have to be undertaken to determine whether, in order to displace the intended benefit of the legislation, express contractual wording is required. Although such explicit wording is, in fact, contained in the Cardholder Agreement, it may be necessary to determine whether, in light of the purpose of the legislation, it is sufficient to have a reference to the incorporated document in a document which is itself merely incorporated by reference into a signed document.

c) Was the Master ’ s decision concluding that there was no necessity for a trial to determine the legal and factual issues relating to incorporation of a document setting aside of the remedial statutory provisions of the Limitations Act correct? [ 53 ] It ’ s possible that the Master made no error in concluding that, in the circumstances here, there was no need for a trial. [ 54 ] However, it is not possible from the Master ’ s decision to discern the strain of contract law on which he relied to come to his conclusion and whether he took the remedial nature of the Limitations Act into account in reaching that conclusion.

The Master was on circuit, where brief reasons are often the only possible ones to give. However, in this case, a reviewing court cannot be assured of either the legal or the factual basis for the Master ’ s decision. For example, on the factual side, there is no reference in the Master ’ s decision to the relatively low credit limit that was the subject of these dealings; such a limit may - or may not - point to some lack of sophistication of the consumer/borrowers.

Nor is there any reference in the decision to the fact that the original document, the Express Loan Agreement, incorporates another document into the agreement in a textbook perfect way and whether this might have had an impact on Mr. McKinnon. Nor is there any reference to the use of the word “ abide ” and what the meaning of that word might be in the context of the arrangement here. Nor is there any reference to the evidence that the ATB employees did not, when “ papering ” the original agreement refer Mr.

McKinnon to the term extending the statutory limitation period; in this case, therefore, the evidence may call out for an assessment of whether “ notice of the terms to be incorporated has been provided in a manner that would lead the reasonable person to conclude that they were to be incorporated in the contract ” ; Morgan at para. 26 and also Nelson Lumber at para. 14.

In other words, there is no discernible assessment by the Master concerning the need for agreement between the parties, consensus ad idem as lawyers sometimes put it, on the extension of the limitation period. [ 55 ] In these circumstances, this court is unable to conclude that the Master ’ s decision denying Mr. McKinnon

summary judgment is correct. ATB ’ s claim against McKinnon will have to be tried. [ 56 ] In light of the decision that I have made with respect to Mr. McKinnon ’ s appeal, it is not necessary to consider ATB ’ s cross- appeal which was to the effect that, in allowing

summary judgment for only a part of its claim, the Master made an incorrect decision. 5 Costs

[ 57 ] If the parties are not agreed on costs, I may be spoken to within 30 days of the release of this decision. Heard on the 25 th day of June, 2013. Dated at the City of Grande Prairie, Alberta this 13 th day of September 2013. J.B. Veit J.C.Q.B.A. Appearances: Glenn A. Taylor, Taylor & Company for Bradley McKinnon Steven A. Rohatyn, Parlee McLaws LLP for the Plaintiff APPENDIX A - Reasons of the Master The defendant, Mr. McKinnon, has brought an application to dismiss the plaintiffs claim and the ATB has brought an application for

summary judgment . In this type of application, the ATB is required to demonstrate that it's plain and obvious or beyond doubt that there's no defence to the claim or part of it. And for his part, the defendant, Mr. McKinnon, in order to succeed on his application would have to demonstrate that it's plain and obvious or beyond doubt that there is no merit to the claim advanced by the ATB. And, in particular, Mr. McKinnon, amongst others, raises two defences that are worthy of note. The first might generally DC described as a limitations defence. The second is the cancellation or the termination defence.

In this case, Mr. McKinnon obtained a credit facility from the ATB in May of 2007. And it obliged him to be jointly responsible for this facility with another individual.

Things appear to have gone reasonable well for a little over a year and then there was apparently a falling out between Mr. McKinnon and the co-debtor, Ms.. Kostenuk. And Ms. Kostenuk has declared bankruptcy and is presently an undischarged bankrupt. Now, insofar as the limitations defence is concerned,

section 7 and 9 of the Limitations Act provide that the two-year universal limitation described by the act can be extended; although, the requirement is that an agreement to extend the limitation period has to be in writing and signed by the person adversely affected. Now, after things deteriorated between Mr. McKinnon and Ms. Kostenuk, Mr. McKinnon attended -- or the evidence is that Mr.

McKinnon attended at the ATB office in Grande Prairie on July, 29th, 2008; and though this is expressed in some, greater detail in his affidavit, explained to the ATB personnel that he would no longer be liable for charges incurred on the ATB MasterCard which was part of the credit facility granted in May of 2007. This action was started in July of 2012. So if Mr. McKinnon's attendance at the ATB's office triggered a cause of action or the elements required by

section 3 of the Limitations Act at that time, this action would be out of time unless it's saved by the provision of the credit facility that extends the limitation period to six years. Mr. McKinnon has argued that he would be obliged in order to give effect to

section 7 and 9 of the Limitations Act to have signed all of the documents provided to him when the credit facility was granted. He did sign the document called express loan credit agreement which incorporates, by reference, a set of terms and conditions to the agreement; and these were provided to him. And the agreement terms and conditions go on to refer to the ATB MasterCard cardholder agreement which was also provided to Mr. McKinnon when the credit facilities were obtained. The card and the credit facilities were used by Mr. McKinnon and Ms.

Kostenuk at least for a period of a little bit longer than a year at which point, as noted, Mr. McKinnon attended the ATB office and told them that he would no longer be liable on the -- for the MasterCard charges. Insofar as the limitations defence is concerned, I am satisfied that the evidence sufficiently incorporates by reference the ATB MasterCard cardholder agreement and the other provisions relating to the extension of the limitation period such that

section 7 and 9 of the Limitations Act are satisfied.

I have some difficulty with the idea that the lender would be required to specifically bring each and every clause that they might rely on at some point in the future to the attention of the borrower. In this case, the documents were physically provided. The borrower could have read them. They aren't written in particularly fine print as legal documents go. And from my reading of them, the language is quite accessible. Insofar as the cancellation or termination defence is concerned, the ATB argues that cancellation or termination of the credit card is required to be in writing. Both Mr.

McKinnon's affidavit and the allegations that form part of the proposed amended pleading give detailed evidence about Mr. McKinnon's attendance at the branch, his indication that he no longer wished to be bound by the credit card agreement, and that -- and would not be responsible for any of the charges that occurred after that. His evidence was that this termination was accepted by the personnel at the branch. The affidavit in response by the ATB is sworn by an account manager in Calgary on information and belief; and the evidence about the circumstances giving. rise to the termination by Mr.

McKinnon are largely uncontroverted. Mr. McKinnon admits in his affidavit that the debt at that point stood at approximately $15,000. In this case, Ms. Kostenuk continued to use the card and there were an additional -- additional 15 or $16,000 worth of charges placed against the card following Mr. McKinnon's purported termination of it. The test for

summary dismissal is well settled as is the law relating to where the onus lies in terms of the evidence that has to be furnished either in support of the application or in response to it. On the basis of the evidence given to me, first of all, I am content to allow the application to amend the Statement of Defence. Secondly, Mr. McKinnon's application for

summary dismissal of the ATB's claim is dismissed. And, thirdly, the ATB's claim against Mr. McKinnon is allowed in part. Rule 7.3(3) of the rules allows me to give judgment for a portion of the claim and to refer the balance of the claim to a trial or for determination. And it strikes me that on the basis of the evidence today, it is plain and obvious that Mr.

McKinnon's limitations defence will not suffice to extinguish, if I can put it that way; the ATB's claim against him; but to my mind, there is a triable issue with respect to the cancellation or termination defence; and, in particular, there is a live and a triable issue with respect to Mr. McKinnon's responsibility for any charges incurred on the card beyond July 29th, 2008.

responsibility for any charges incurred on the card beyond July 29th, 2008. So I am going to allow ATB's application for judgment against Mr. McKinnon for the charges to and including July 29th, 2008, but send on the balance of the claim to trial. Given that it's finally given that the rule relating to amendment requires the court to specify when the amended pleading needs to be filed and served, and given that both sides are represented, I am going to say that the Amended Statement of Defence should be filed and served within 14 days of the date of the order. APPENDIX B Extract from signed Express Loan Credit Agreement APPENDIX C Extract from unsigned Agreement Terms and Conditions

APPENDIX D Extract from unsigned

ATB Financial Business Mastercard Holder Agreement (Agreement) sic