Qairrulik Outfitting Ltd. v. Sholz, 2018 NUCJ 7

Nunavunmi Maligaliuqtiit NUNAVUT COURT OF JUSTICE Cour de justice du Nunavut Citation: Qairrulik Outfitting Ltd. v. Sholz, 2018 NUCJ 7 Date: 20180130 Docket: 08-17-255 Registry: Iqaluit Plaintiff: Qairrulik Outfitting Ltd. -and- Defendant: Peter Sholz ________________________________________________________________________ Before: The Honourable Mr. Justice Paul Bychok Counsel (Plaintiff): Guy Vachon Counsel (Defendant): Self-Represented Location Heard: Iqaluit, Nunavut Date Heard: January 30, 2018 Matters: Small Claims Hearing REASONS FOR JUDGMENT (NOTE: This document may have been edited for publication)

I. BACKGROUND [ 1 ] The plaintiff, Qairrulik Outfitting Ltd. of Iqaluit, rented a snow machine to the defendant, Peter Sholz, on March 28, 2017. The plaintiff company is owned and operated by Guy Vachon. The contract was for a rental the next day from 9 a.m. to 5 p.m. The defendant picked up the snow machine the next morning. He did not return the snow machine by five p.m. Instead, he abandoned it on the land. The plaintiff has sued the defendant in Small Claims Court to recover the costs it incurred to locate and transport its snow machine back to its shop as well as lost profits.

The plaintiff did not say whether his claim is based in contract or tort. [ 2 ] The hearing was held on January 29, 2018 and I reserved my decision. These are my reasons for judgment. II. FACTS [ 3 ] The parties entered into a simple contract on March 28, 2017 for the day rental of a snow machine. The terms of the contract were written by hand on an invoice. The contract reads as follows: Rental For Tomorrow 1 Bear Cat from 9 – 5 p.m. Damages Lost Injuries Your Responsibility [ 4 ] The rental fee agreed to by Mr. Sholz was $341.25. Mr. Sholz signed the contract. [ 5 ] Mr.

Sholz filed with the Court a two-page written explanation of his actions that day. In it, Mr. Sholz said he explained his route to Mr. Vachon, and that Mr. Vachon did not warn him he might run into difficult conditions. Mr. Vachon did not have a SPOT [1] so he told Mr. Sholz to try Baffin Gas. The staff there did not have one either. In his written submission, Mr. Sholz complained that no one at either business told him he might get a SPOT at the local HTO. He said he left Iqaluit at 9 a.m. with a full tank of gas.

He also left town without a GPS because, “again, none available (sic)”. [ 6 ] The Court heard different versions of what was said by the parties before the contract was signed. Mr. Sholz claims he asked three times for an extra tank of gas, but that Mr. Vachon refused saying he did not need it. Mr. Vachon denied that claim, saying that he had in fact suggested extra gas. Mr. Vachon’s assertion was supported by his employee, Jimmy Kovic, who was present throughout these discussions. [ 7 ] Mr. Kovic testified that he and Mr. Vachon “tried to recommend he (Mr.

Sholz) bring extra gas but he figured the big tank on the machine he was driving had enough to come back”. [2] Mr. Kovic also said he knew exactly what route Mr. Sholz was planning to take because “the only way to come back was through that fisher ice where the polynyas were”. In his view, Mr. Sholz did not have enough gas to make the return trip as planned. [3]

[ 8 ] Mr. Sholz said he had checked “the day before” with a licensed local guiding agency to discuss his planned route. He did not recall who he spoke to, but he said whoever he spoke to did not have any concerns about his route. He said he also asked Mr. Vachon if there were any problems with his proposed route. Mr. Vachon, he said, “did not indicate any”. [4] [ 9 ] Mr. Vachon denied Mr. Sholz’s version of events. Mr. Vachon said he advised Mr. Sholz “not to go there and travel by himself. It’s not safe”. [5] [ 10 ] Mr. Sholz, Mr. Vachon and Mr. Kovic all testified over the telephone.

I asked several questions of each of them to clarify the evidence. But, without cross examination to test the credibility and reliability of what I was told, the discrepancies in what was said between the parties stand. I am not able to resolve these discrepancies. [ 11 ] In his two-page email, Mr. Sholz provided a lengthy account of the route he took from Iqaluit to the south end of Ward Inlet on Frobisher Bay. He stated he had half a tank of gas left when he arrived there. Once he arrived there, he discovered that it was low tide and the snow machine track had “crumbled”. He said: “I was trapped”.

He did not turn around and retrace his route back to town. [ 12 ] Instead, Mr. Sholz said he then spent an hour driving around trying to find a route back to Iqaluit before giving up. He abandoned the snow machine with 1/8 tank of gas left between 2:30 and 3 p.m., and he started to walk back to town. He was picked up later by a passing helicopter. [ 13 ] Significantly, Mr.

Sholz acknowledged the following in his written submission: “I felt comfortable with the route as I had travelled as far as Ward Inlet overland before and remembered the way, the weather was good, and my return route was not complex – just follow the sea ice”. [6] I asked Mr. Sholz how long he had been living in Iqaluit at that time, and he replied two and a half years. He claimed to have no knowledge of Iqaluit’s daily tides. III. THE PARTIES’ POSITIONS [ 14 ] Mr. Vachon says that Mr. Sholz left his snow machine on the sea ice instead of returning it to his shop. He has claimed damages totaling $1,438.50.

This claim includes hiring two guides to go out to retrieve the snow machine, lost profit for one snow machine used by the guide, lost profit on the rented snow machine because two other clients had to be turned away, gasoline and a $100 administration fee. Mr. Vachon told me the administration fee is to compensate him for the half day he spent calling around town trying to locate the abandoned machine. [ 15 ] Mr. Scholz, in turn, referred the Court to his two-page email which outlined the events of the day in question. He then read a “final statement” to the Court. Mr.

Sholz said the rental contract at issue created “a trust” between the parties. He stated he fulfilled his duty of care by requesting an extra tank of gas, by informing the plaintiff of the length and location of his trip, and by treating the snow machine “as if it were my own”. [7] He said the plaintiff misrepresented the range of the snow machine on one tank of gas. By doing so, he continued, “the duty of care for issues arising from the range of the vehicle was transferred legally from myself as renter to the rental agency”. [8] He said he was not liable for the damages claimed by Mr. Vachon. IV. THE LAW A.

Contract Law [ 16 ] Entire books have been written and much judicial ink spilled on what makes an enforceable contract. In Canada, contract law is part of the judge-made common law. Contract law has evolved as society has developed and become more complex. In its most basic form, a contract is formed when there is an offer, an acceptance, and the exchange of something valuable between the parties. [ 17 ] If one party to a contract fails to perform his obligation(s), the other party is entitled to sue him to be compensated for his resulting damages. In contract law, this is called the expectation measure.

It includes, for example, lost profits which resulted from the contract breach. [9] The aim of the remedy is to put the plaintiff in the position he would have been in had the contract been performed according to its terms. [10] Courts look to see whether the parties have contemplated what would happen should one party breach the contract. In those cases, contract law principles will govern the analysis.

B. Tort Law [ 18 ] Traditionally, the only remedies available to an aggrieved person for breach of contract were to be found in contract law.

However, the law has evolved and in certain circumstances an action in tort may be available for breach of contract. [11] (Tort law is judge made common law which provides remedies for civil wrongs.) A remedy in tort may be available if the relationship between the contracting parties is so close that a common law duty of care arises. [ 19 ] In those cases where a tort remedy may be available for a contract breach, the objective is the same – to put the plaintiff in the position he would have been in had the contract been performed according to its terms. V.

BURDEN OF PROOF [ 20 ] This is a civil action, so the burden of proof – by which I mean job of persuading me – lies with the plaintiff on a balance of probabilities. VI. CHOICE OF REMEDY [ 21 ] A plaintiff may choose to pursue to his advantage either a claim in contract or in tort. [12] The facts of this case lead to the same result whichever analysis is followed. In my view, this is a simple contract case. VII. ISSUES [ 22 ] There are two issues which I must decide. 1. Did the Mr. Sholz breach his contract with the plaintiff? 2.

If the answer to the first question is yes, how should the plaintiff’s damages be compensated? [ 23 ] For the following reasons, I find that Mr. Scholz breached his contract with the plaintiff. Mr. Sholz is liable to compensate the plaintiff for the economic loss which the latter suffered as a direct result of the breach. VIII. ANALYSIS [ 24 ] This case presents a good example of a simple everyday contract. Mr. Vachon, for the plaintiff, offered to rent its snow machine to the defendant, Mr. Sholz, on certain terms including the cost of the rental. Mr. Vachon told Mr.

Sholz that any damages to the machine or losses or injuries suffered by him during the rental period would be the latter’s responsibility. The rental was to start at 9 a.m. on March 30th, and Mr. Sholz was required to return the snow machine to the plaintiff that same day in the same condition by 5 p.m. These terms were written down. The parties also agreed that Mr. Scholz would return the snow machine with a full tank of gas. [ 25 ] Whatever discussions there may have been about various things – gasoline, a SPOT, a GPS, and the planned route – Mr.

Sholz agreed to rent the machine subject to the terms included in the written contract. Mr. Sholz paid the rental fee and took possession of the machine the next day according to the contract’s terms. [ 26 ] In my view, this case is about a simple and straightforward commercial transaction. Mr. Sholz wanted to rent a snow machine, and Mr. Vachon rented him one for the day. Mr. Vachon’s obligation under the contract was to provide a serviceable snow machine with a

full tank of gas. Mr. Vachon fulfilled his obligation. [ 27 ] Mr. Sholz’s obligation under the contract was to return the snow machine in the same condition by 5 p.m. that day. Mr. Sholz breached the contract when he decided to abandon the snow machine on the land over 20 kilometres from town. [ 28 ] If Mr. Sholz believed he needed a SPOT, or a GPS, or an extra tank of gas, or further information to ensure a safe trip, the onus was on him to obtain it. He chose not to pursue any of these things. Instead, he decided to head out in any event.

He was after all as he claimed: “comfortable with the route” because he had driven it before. The weather was “good” and the route was “not complex”. In the end, the route turned out to be much more difficult than he had foreseen. The tide was out, and he ran out of gas. He alone is responsible for his misfortune that day. [ 29 ] Mr. Sholz’s obligation was to return the snow machine to its owner no later than 5 p.m. on March 30th. He abandoned the snow machine on the land instead. [ 30 ] There is no evidence that the parties had discussed what would happen in the event Mr.

Scholz breached his contract by failing to return the snow machine. Therefore, I must return to first principles. As I stated earlier, the following is a fundamental principle of contract law: that the plaintiff be put into the position he would have been in had the contract been performed. [ 31 ] It cost the plaintiff $1,438.50 to hire two guides, and the loss of use of two snow machines for the day, to retrieve the snow machine abandoned by Mr. Sholz. He would not have had to incur those expenses had Mr. Sholz returned the snow machine according to the contract’s terms. [ 32 ] In my view, Mr.

Sholz demonstrated poor judgment in not taking basic pre-trip precautions. He placed too much confidence in his flawed understanding of the challenges and risks posed by his trip. Mr. Sholz also demonstrated poor judgment when he realized he was starting to run low on gas. He ought to have turned around and returned to town when he noticed he was down to half a tank of gas. Instead, he drove around fruitlessly for an hour looking for a non-existent path through the sea ice. Mr. Sholz cannot blame others for his own actions.

Nor do his actions provide him with an excuse for not returning the snow machine to the plaintiff according to the contract. [ 33 ] The contract in this case was a simple one-day rental of a snow machine. The contract did not insure Mr. Sholz from the results of his own decisions. Mr. Sholz is, therefore, liable for the reasonable costs incurred by Mr. Vachon to retrieve the snow machine where it had been abandoned by Mr. Sholz in breach of the contract. IX. REMEDY A. Damages [ 34 ] Each category of the plaintiff’s itemized loss was caused directly by Mr. Scholz’s breach of contract.

I award the plaintiff his claimed damages in the amount of $1438.50. B. Costs [ 35 ] The Rules of Court permit the award of costs to a maximum of 10%. [13] Mr. Sholz’s liability was clear cut. The file was sent to

mediation to assist with an out-of-court settlement, and a mediation hearing was held. But, Mr. Scholz was determined to litigate. In my view, this is an appropriate case for a costs award. I award the plaintiff a further $143.85 in costs. [ 36 ] The total award in Mr. Vachon’s favour, then, is $1,582.35. Dated at the City of Iqaluit this 16th day of March, 2018 ___________________ Justice Paul Bychok Nunavut Court of Justice