Moore v Wetaskiwin Friends and Horizons Training, 2022 ABKB 617

Court of King’s Bench of Alberta Citation: Moore v Wetaskiwin Friends and Horizons Training, 2022 ABKB 617 Date: 20220606 Docket: 1612 000151 Registry: Wetaskiwin Between: Audrey Gail Moore Plaintiff - and - Wetaskiwin Friends of the Differently Abled Society and Horizons Training Centre Society Defendants _______________________________________________________ Reasons for Judgment of the Honourable Justice Eleanor J. Funk _______________________________________________________ [ 1 ] I delivered these reasons orally on June 6, 2022. Since then, I have decided to release these reasons in written form.

For the purpose of any Order that is generated, or any appeal that may be filed, the date of this Judgment is June 6, 2022. Introduction [ 2 ] The Plaintiff, Audrey Moore, worked for the Horizons Training Centre Society (“ Horizons ”) for 26 years until her

retirement in 2012. Horizons is a non-profit organization that provides supports for disabled individuals. It receives its funding from an Alberta organization called Friends of the Differently Abled Society (“ Friends ”). [ 3 ] A year before she retired, the Chairman of the Board of Friends wrote to Ms. Moore to tell her that she would be eligible for a retirement assistance supplement, if she chose to retire. Six months after receiving this letter, Ms. Moore advised the Board that she would be retiring, effective in another six months, on September 21, 2012. [ 4 ] Four days after her retirement, Ms.

Moore, together with the Chairman and Treasurer of the Board of Friends , signed a Retirement Agreement (the “Retirement Agreement”), under which Friends agreed to pay Ms. Moore $2,600 a month, starting on October 1, 2012, and continuing until her death. [ 5 ] Friends paid Ms. Moore $2,600 on October 1 st and on the first of every month for 39 months until January 2016, when the new Board Chairman wrote to Ms. Moore to tell her these ‘gratuitous’ payments would end on July 1, 2016. Friends has made no further payments to Ms. Moore since that date. [ 6 ] Ms. Moore brings this application for

summary judgment and specific performance against Friends for its alleged breach of the Retirement Agreement. [ 7 ] Friends alleges the Agreement is void and unenforceable for what it claims were breaches of Ms. Moore’s employment and fiduciary duties. It alleges the Retirement Agreement was wrongfully executed and not ratified and, that it is unconscionable. [ 8 ] The issue before me comes down to whether, on this record, I can determine if the Retirement Agreement is valid and enforceable, or, if there are genuine defences on which the Agreement could be set aside at trial.

Background [ 9 ] At the time of her retirement from Horizons , Ms. Moore was its Executive Director. By virtue of the close relationship between Horizons and Friends , she was also the de facto Executive Director of Friends and an ex officio member of the Friends Board of Directors. She took directions from the Friends Board and acted as a representative of the Board. Friends and Horizons each had Boards that were made up of essentially the same people. [ 10 ] Friends alleges a relevant time period that dates back to 2007, when Horizons ’ employees had been paying into a benefits program through Sunlife.

In 2007, Horizons’ Sunlife shares were being de-mutualized, and the Boards of Horizons and Friends discussed what to do with the Sunlife shares. One option discussed was to sell the shares and to give the sale proceeds to Friends to establish a retirement fund for Horizons employees. [ 11 ] Instead of setting up this retirement fund, the Treasurer of the Friends Board suggested selling the shares and dividing the proceeds between Ms. Moore and Mr. Sorenson, another employee of Horizons . In making this motion, the Treasurer stated that Ms. Moore and Mr.

Sorenson were the only two employees who had contributed to the Sunlife benefits. The Board passed this motion; the Sunlife shares were sold; and Friends paid Ms. Moore and Mr. Sorenson each over $70,000 from the sale proceeds. No retirement fund was created. [ 12 ] In reality, there were other employees, in addition to Ms. Moore and Mr. Sorenson, who had paid into the Sunlife benefits plan. Ms. Moore was present at the Board meeting when the Treasurer moved for all the share proceeds to go to her and Mr. Sorenson. She did not correct his misstatement to the Board that she and Mr.

Sorenson were the only two contributing employees. [ 13 ] In seeking to now set aside the 2012 Retirement Agreement, Friends argues that Ms. Moore breached her fiduciary obligations to the Board by not correcting the misstatement made by the Treasurer and in accepting the proceeds from the sale of the Sunlife shares. [ 14 ] Later, in 2010, the Board of Friends again discussed setting up a retirement fund and a retirement program for employees with more than 25 years of service. At this time, Ms. Moore and Mr.

Sorenson were the two employees who would meet this criterion. [ 15 ] The Board created a Management Committee (the “Committee”). Ms. Moore, Mr. Sorenson, the Board Chair, the Treasurer, and other Board members were on this Committee. The Committee instructed Ms. Moore to investigate setting up a living trust that would be used to secure funds for a retirement program. Ms. Moore made some inquiries and reported back to the Board Chair and others on the Committee.

Ultimately, a decision was made that a living trust was not feasible and there were no further discussions about setting up any kind of retirement fund. [ 16 ] Friends now argues that Ms. Moore misled and misdirected the Board in relation to setting up a retirement fund. [ 17 ] The Committee came up with a formula for a Retirement Program (the “Retirement Program”) that would provide a retirement supplement to retired employees. Under this Program, Friends would pay retired employees a monthly amount of $100 for each year of service.

An employee with 25 years of service, for example, would receive a monthly retirement supplement from Friends of $2,500, for life. [ 18 ] Friends alleges that Ms. Moore acted in a conflict of interest through her involvement on this Committee, as she was one of only two employees who would benefit from any retirement program. [ 19 ] The Committee instructed Ms. Moore to work with legal counsel to have this Retirement Program drafted into a contract. Ms. Moore retained counsel on behalf of Friends for this purpose. Ultimately, counsel provided Ms.

Moore with drafts of a retirement medical program and retirement assistance program. There is no evidence before me if the Committee or Board reviewed these documents. Neither Ms. Moore, nor anyone from the Board signed any of these documents.

[ 20 ] Friends argues the failure of the Board to ratify the Retirement Program in 2010 now serves to undermine the validity of the Retirement Agreement that Ms. Moore entered with Friends in 2012. [ 21 ] Friends also alleges that Ms. Moore exceeded her authority in her dealings with legal counsel and that she instructed legal counsel on matters over which the Board had not authorized her. Both Ms. Moore and the Board Chairman, at the time, stated that Ms. Moore shared with the Board Chairman the correspondence that she exchanged with legal counsel. [ 22 ] In 2011, Ms.

Moore was on an extended leave from her work. In October of that year, the Chairman of the Friends Board, Peter Edwards, wrote to her to tell her that she would be eligible to receive a retirement assistance supplement, should she decide to retire rather than return to work. [ 23 ] Six months later, in April 2012, Ms. Moore tendered her letter of resignation to the Board, deciding to retire after 26 years of employment. In this letter, she stated that her last day would be September 21, 2012. Four days after her last day, Ms. Moore signed the Retirement Agreement that forms the basis of this application. Mr.

Edwards, as Board Chair, and Mr. Johnson, as Board Treasurer, also signed this Agreement. [ 24 ] Under the terms of this Agreement, Friends would pay Ms. Moore $2,600 on October 1, 2012, and would continue to pay her this amount on the first of every month, for the rest of her life. The Agreement contained no conditions or provisions under which Friends could rescind it. Ms. Moore has stated that the financial security provided under this Agreement was key in her decision to retire when she did. [ 25 ] The Retirement Agreement is a simple, two-page document in which the parties acknowledged that Ms.

Moore had been employed for 26 years, and that she was in good standing with the employer. It acknowledged that she was at least 60 years old and that she met the eligibility criteria under the appropriate sections of the Retirement Assistance Program. It acknowledged that Friends would be under a legal obligation to Ms. Moore, for the rest of her life. It stated that the spirit and purpose of the Retirement Agreement was to remunerate Ms.

Moore for her years of dedicated service to Horizons and to recognize that she had foregone the benefits of retirement that were unavailable to her through this employment. [ 26 ] On October 1, 2012, Friends paid Ms. Moore $2,600. It continued to pay her $2,600 each month for 39 months. Then, in January of 2016, the new Chairman of the Friends Board wrote to Ms. Moore to tell her these ‘gratuitous’ payments would stop. The letter made no reference to the Retirement Agreement. Instead, the Board Chair stated that Friends was under no legal obligation to make these payments.

The letter contained a series of post-dated cheques, with the last cheque dated July 1, 2016. This is the last payment that Friends made to Ms. Moore. [ 27 ] Ms. Moore now seeks

summary judgment for the payments Friends has not made from August 2016 to the present and she seeks an order for specific performance in contract, compelling Friends to continue to honour the Retirement Agreement. [ 28 ] Friends alleges several defences. In addition to claiming that Ms. Moore breached her fiduciary duties to the Board and acted in a conflict of interest, it argues the Retirement Agreement is void and unenforceable as the Board did not ratify the Retirement Program back in 2010 and did not ratify this Retirement Agreement in 2012. It further argues the Retirement Agreement is unconscionable. Principles of

Summary Judgment [ 29 ] Rule 7.3 of the Rules of Court sets out the basis on which

summary judgment may be granted. The Alberta Court of Appeal in Weir-Jones Technical Services Incorporated v. Purolator Courier Ltd. , 2019 ABCA 49 , at para 47 , has articulated the key considerations for judges to follow in

summary judgment applications. [ 30 ] First, having regard to the state of the record before me, I must determine if its possible to fairly resolve this dispute on a

summary basis, or if uncertainties in the facts, the record or the law reveal a genuine issue requiring a trial. [ 31 ] I must consider whether Ms. Moore, as the party seeking

summary judgment, has met her burden of showing there is either no merit or no defence and that there is not a genuine issue requiring a trial. Here, the threshold level of facts of the case must be proven on a balance of probabilities. If not, the application will fail. Merely establishing the facts is not a proxy for establishing that the defences have “no merit”. [ 32 ] If I find that Ms. Moore has met her burden, I must next determine if Friends , as the party resisting

summary judgment, has demonstrated, on this record, that there is a genuine issue requiring a trial. Friends can do this by challenging Ms. Moore’s case; by identifying a positive defence; by showing that a fair and just

summary disposition is not realistic; or by otherwise demonstrating that there is a genuine issue requiring a trial. If there is, then

summary judgement is not available. [ 33 ] In the end, I must be left with sufficient confidence in the state of the record such that I am prepared to exercise my judicial discretion to summarily resolve this matter. Evidentiary Issue [ 34 ] Rule 13.18(3) of the Rules of Court provides that if an affidavit is used in support of an application that may dispose of all or part of a claim, the affidavit must be sworn based on the personal knowledge of the person swearing it. [ 35 ] Recently, in Saito v. Lester Estate , 2021 ABCA 179 , at paras 11 and 12 , the Alberta Court of Appeal explained that some flexibility is required in interpreting Rule 13.18 and the use of hearsay affidavits in

summary judgment applications, particularly involving corporations. By ‘some flexibility’, the Court means that Rule 13.18(3) should not be read as an absolute bar to the use of hearsay evidence. When evaluating whether hearsay evidence should be admitted on a

summary judgment application, a key consideration is whether the underlying source of the information is reliable and would be admissible at trial (see, Barry v. Industrial Alliance Insurance and Financial Services Inc (IAF) , 2022 ABQB 265 , for a survey of the current law).

[36] This Court has expressed mixed views on whether Respondents in

summary judgment applications should be permitted to relyon hearsay evidence. Justice Feasby recently reviewed this Court’s jurisprudence on this issue in Barry, where he found the requirementthat a Respondent put its best foot forward, as set out in Weir-Jones, does not mean much if the Respondent in

summary judgmentapplications can shield witnesses in its control by relying on reports by anonymous authors containing hearsay filed with the Court inearlier applications. [37] Justice Feasby concluded that to achieve the policy objectives of improving access to justice through the greater use ofsummary judgment, identified by the Supreme Court in Hryniak v Mauldin, 2014 SCC 7 at para 34, and more recently in Weir-Jones,the best foot forward rule must have some teeth. With this, he found that requiring Respondents to meet the same standard ofadmissibility of hearsay evidence on

summary judgment applications as at trial is reasonable. (Barry, at paras 54-59, citing DD vCalgary Counselling Centre, 2017 ABQB 95, Clark Builders and Stantec Consulting Ltd v GO Community Centre, 2019 ABQB 706,Vulcan v Genesis Reciprocal Insurance Exchange, 2020 ABQB 93, and ANC Timber v Alberta (Minister of Agriculture andForestry), 2019 ABQB 653. [38] Where corporate representatives swear affidavits on behalf of their corporations, they may establish personal knowledge byfamiliarizing themselves with reliable corporate records.

To the extent that activities of a corporation are recorded in reliable documents,an authorized person may obtain personal knowledge by reviewing those documents and then speaking to those activities: Attila DoganConstruction and Installation Co. v. AMEC Americas Ltd., 2015 ABQB 120, at para 74, aff'd 2015 ABCA 406, and Scotia MortgageCorp v Aab, 2012 ABQB 464 (Master) at paras 15 and 16. [39] When corporate officers review business records, the corporation can satisfy the personal knowledge requirement of the Rulesof Court. This parallels the business records exception to the hearsay rule.

Business records are admissible hearsay evidence if therecorder is functioning in the usual and ordinary course of a system in effect for the preparation of the records: Attila Dogan, at paras 72-73, citing Alberta Treasury Branches v. Leahy, 1999 ABQB 185, see also, Advance Rumely Thresher Co. v. Laclair (1916), (AB CA), [1917] 1 W.W.R. 875 (ABCA); Alberta Treasury Branches v. Wenley Enterprises & Sales Ltd. (1985), (AB KB), 66 A.R. 232 (ABQB) (Master); and Principal Savings & Trust Co. (Liquidator of) v.

Bowlen (1991), 1 C.P.C.(3d) 206 (ABQB)(Master). [40] Correspondence is admissible where made or kept in the ordinary course of business by a person under an obligation toaccurately record the facts: Ares v Venner, (SCC), [1970] SCR 608, see also, R v Monkhouse, 1987 ABCA 227. [41] Corporate representatives may establish personal knowledge by reviewing corporate records. They may not otherwise rely oninadmissible hearsay. Where corporate representatives lack personal knowledge, they may rely on direct evidence exhibited to theiraffidavits, in accordance with the common law rules of evidence.

This hearsay must either fall under the common law or principledexception or be relied on for non hearsay purposes: Attila Dogan, at para 88. [42] With these principles in mind, I turn to the evidence before me on this application. [43] Ms. Moore relies on her affidavit and that of Peter Edwards, the Friends Board Chair throughout the relevant period. Theyboth speak to their personal knowledge in their affidavits. [44] Friends relies on the affidavit of William Elliot. He is the current Chair of the Board of Friends. He was not a member of theBoard during the relevant period of 2007 to 2012.

In his affidavit he deposes to matters that are not within his personal knowledge. Hisaffidavit is almost entirely made up of hearsay statements, the majority of which are not attributed to their original sources. [45] Ms. Moore has not applied to set aside Mr. Elliot’s affidavit nor to strike any portions of it for its reliance on hearsayevidence. In my function as gate keeper, I must be satisfied that the evidence before me is reliable and conforms with the applicable rulesof admissibility as I have reviewed in earlier portions of these reasons. [46] In his affidavit, Mr. Elliot said that Ms. Moore and Mr.

Sorenson were “instrumental in putting motions before the Board” forthe establishment of medical and retirement benefits for employees. In questioning, Mr. Elliot said that he learned this by “reading andtalking to people”. This included talking to some of the staff. He could not recall who these people were but believed, from theseconversations, that Ms. Moore and Mr. Sorenson instigated the motions for retirement benefits. In interviews of unnamed Boardmembers, Mr. Elliot stated that it was Ms.

Moore who brought forward the motion in favour of retirement benefits. [47] This contradicts the Board minutes that show it was Mr. Edwards, as Board Chair, and Mr. Johnson, as Board Treasurer, whoput forward and seconded these motions. [48] Mr. Elliot acknowledged, in questioning, the Board minutes showed it was the Committee that recommended the Sunlifeshares be sold, and the money donated to Friends. He acknowledged the Friends Board recorded that these sale proceeds would be usedto compensate Ms. Moore and Mr. Sorenson. [49] Mr.

Elliott believed these Board minutes were not a true reflection of what took place at these meetings. He gained this beliefthrough interviews in which individuals said they believed the Board was setting up a retirement fund, but not specifically for Ms. Mooreand Mr. Sorenson. He thought this information came form interviews with four Board members, only three of whom he could identifywhen asked in questioning. The three individuals he named were present at the Board meetings where these resolutions were passed. [50] In his affidavit, Mr. Elliott stated the Board of Friends did not approve paying Ms.

Moore and Mr. Sorenson the proceedsfrom the sale of the Sunlife shares. He said that Mr. Johnson told him that the Board thought they were setting up a retirement fund. [51] Mr. Elliot acknowledged, in questioning, that Ms. Moore and Mr. Sorenson each received over $70,000 from the sale of theSunlife shares. He was aware they were both paid by way of cheques that were signed by Dale Johnson, the Board Treasurer at the time. [52] Mr. Elliot stated in his affidavit that the Board of Friends wished to have a living trust established. In questioning, he said it

was his understanding that this was going to be set up as long as there were funds available, and if funds were not available, the Board would not subject future Boards to having to fulfill the obligation of a retirement plan. He gained this understanding from the reading that he had done. [ 53 ] In his affidavit, Mr. Elliot stated that the Boards of Friends and Horizons were “unduly influenced” by Ms. Moore. Some of the Board members apparently told this to him; he named three of them. He said in questioning that Board member, Ed Ruff, told him that he trusted Ms.

Moore and whatever she said he felt was correct, and he felt the Board had been “somewhat manipulated” by her. Mr. Elliot said that Dale Johnson told him “similar things”. [ 54 ] Mr. Elliot said, in questioning, that two former Board members told him that the Board minutes did not reflect what actually happened. These Board members told Mr. Elliott that Board minutes recorded these individuals as moving and seconding motions when these people had not actually done so. [ 55 ] In his affidavit, Mr. Elliot stated that Ms.

Moore did not share details of correspondence with the Board involving the resignation of a Board member. In questioning, he said that two former Board members told this to him. [ 56 ] In questioning, Mr. Elliot acknowledged that he did not ask Mr. Edwards or Mr. Johnson why they signed the Retirement Agreement with Ms. Moore. He did not know who prepared the Agreement, but assumed it was a lawyer. [ 57 ] Mr. Elliot’s information came entirely from conversations he had with various individuals and from interviews taken with various individuals.

Based on the legal principles that I have reviewed here, I cannot conclude that Mr. Elliot’s conversations with former Board members and his review of unspecified interviews with former Board members are corporate records in the way that has been accepted in the case law. Without evidence of these being reliable corporate records, Mr. Elliot’s reliance on this information does not establish he had personal knowledge of the activities of Friends . [ 58 ] I must next consider whether the hearsay statements on which Mr.

Elliot relies would be admissible under the principled approach to hearsay, the two requirements of this exception being necessity and reliability. [ 59 ] There is no evidence before me as to why the declarants of these statements did not provide affidavits and make themselves available to be questioned on those affidavits. Without this evidence, I cannot conclude the necessity requirement has been met. [ 60 ] Nor is there evidence before me of the circumstances in which these conversations and interviews took place.

In relation to the interviews, there is no evidence of when or under what circumstances they took place. There is no evidence if the persons being interviewed were under oath or affirmation to tell the truth. There is nothing on the record to establish any circumstantial guarantees of trustworthiness. Without this evidence, the reliability requirement has not been met. [ 61 ] Without bringing itself into the business records or principled exceptions to hearsay, Mr.

Elliot is repeating in his affidavit information he has gleaned from conversations with other people and from interviews he has read involving other people. This is inadmissible third-party hearsay that would not be admissible in a trial. With this finding, I decline to admit Mr. Elliot’s evidence for the truth of its contents. [ 62 ] If I am wrong in this approach, I would nonetheless exclude Mr. Elliot’s affidavit on the grounds that Friends failed to comply with Rules 13.18(2) and (3) of the Rules of Court that provides that affidavits sworn on information and belief must disclose the source of that belief.

At a minimum this means that Mr. Elliot’s affidavit must have identified 1) where he was relying on hearsay information and 2) the sources of that hearsay.

That was not done. [ 63 ] Rule 13.18(3), as I’ve already reviewed in these reasons, states that affidavits used in support of applications that may dispose of all or part of a claim must be sworn based on firsthand knowledge. [ 64 ] When I consider the flexibility in approaching this Rule that the Court of Appeal has endorsed, I am taken back to my findings that the record before me does not establish the necessity or reliability of this hearsay evidence. [ 65 ] When I consider the principle of fairness and the ability to achieve a just result, I find the admission of Mr.

Elliot’s affidavit would operate unfairly against Ms. Moore because it deprives her of the ability to question the individuals on whose statements Friends seeks to rely in resisting her application for

summary judgment. [ 66 ] Friends did not question Mr. Edwards on his affidavit and did not provide an affidavit of Mr. Johnson, or any other Board members who were present at various meetings and whose opinions and recollections are reflected in Mr. Elliot’s affidavit. Because of this, I find that Friends has not put its best foot forward in resisting Ms. Moore’s application for

summary judgment. The modern approach in interpreting contracts [ 67 ] The

interpretation of contracts has evolved towards a practical, common-sense approach, not dominated by the technical rules of construction. The overriding concern is to determine the intention of the parties and the scope of their understanding at the time of entering the contract. Judges, as decision makers, are to read the contract as a whole, giving words their ordinary and grammatical meaning, consistent with the surrounding circumstances known to the parties at the time the contract was formed: Creston Moly Corp. v.

Sattva Capital Corp., 2014 SCC 53 at para 47 , cited in IFP Technologies (Canada) Inc. v EnCana Midstream and Marketing , 2017 ABCA 157 , at para 298 . [ 68 ] The role and nature of the circumstances surrounding the formation of contracts forms part of the evidence that judges can consider when interpreting those agreements. While the surrounding circumstances may be considered in this exercise, they must not be allowed to overwhelm the words of the agreement.

The goal of examining the surrounding circumstances is to deepen the judges’ understanding of the mutual and objective intentions of the parties as expressed in the words of the contract. The

interpretation of any contract must be grounded in the text and read in light of the entire agreement. The surrounding circumstances cannot be used to deviate

the court from the text such that a new agreement is effectively created: Sattva , para 57. [ 69 ] The nature of the surrounding circumstances that can be relied on in this analysis will vary from case to case. But it has its limits. It should consist only of objective evidence of the background facts at the time the contract was signed. It consists of knowledge that was or reasonably ought to have been within the knowledge of both parties at or before the date of signing the contract.

Subject to these requirements, and the parol evidence rule, this includes ‘absolutely anything which would have affected the way in which the language of the document would have been understood by a reasonable person’. Whether something was or reasonably ought to have been within the common knowledge of the parties when they signed the contract is a question of fact: Sattva , para 58. Analysis [ 70 ] To succeed, Ms. Moore must demonstrate that she has met her burden, on a balance of probabilities, of showing there are no defences to her claim for

summary judgment and no genuine issues requiring a trial: Weir-Jones , at para 32 cited in Stankovic v 1536679 Alberta Ltd , 2019 ABCA 187 , at para 22 . [ 71 ] The Retirement Agreement is clear and unambiguous on its face. Ms. Moore signed it, along with the Chairman and the Treasurer of the Board of Friends . Both Ms. Moore and Mr. Edwards, the Board Chair at the time, understood and intended the Retirement Agreement to mean that Friends would pay Ms. Moore $2,600 a month, starting in October of 2012 and ending with her death. [ 72 ] As to the scope of their understanding, both Mr. Edwards and Mr.

Johnson were Board members and present at various Board meetings between 2007 and 2012, the period on which Friends relies to allege a history of transactions between Ms. Moore and the Board that should now vitiate this Agreement. Presumably, Mr. Edwards and Mr. Johnson were both aware of the history of transactions when they signed this Agreement with Ms. Moore. [ 73 ] I find that Ms. Moore has met her burden by showing, on a balance of probabilities, that Friends breached its contractual obligations when it stopped making its monthly payments to her.

I make this finding because the Retirement Agreement is clear and unambiguous in its terms. The affidavits before me demonstrate that the parties intended, when they signed the Agreement, that the entire Agreement was reduced to writing, and that Friends would be bound by this Agreement. Finally, Friends acted on this Agreement by paying Ms. Moore $2,600 each month for more than three years before taking the position it now takes.

Should the Retirement Agreement be set aside for the Board’s failure to ratify it? [ 74 ] Friends argues the Board did not ratify the Retirement Agreement and should not be bound to this Agreement. [ 75 ] Ratification can be proven either by express acts or by implication. Proof of ratification by express acts requires a clear, adoptive act. The act must manifest an intention to ratify the acts of the agent. It must also take place after the agent has acted on behalf of the principal. [ 76 ] Ratification may also be implied from the principal’s conduct, without some act by the principal to indicate ratification.

Implied ratification requires more than mere silence on the part of the principal. Implied ratification happens where the conduct of the principal is inconsistent with any position other than it has accepted and confirmed the acts of the agent. The effect of ratification is to bind the principal to the acts of the agent: G.H.L. Fridman, Canadian Agency Law , 3rd ed., 2017, at 2.27-2.28. [ 77 ] I find the Board did in fact ratify the Retirement Agreement through its subsequent conduct. I make this finding because for 39 months, Friends paid Ms.

Moore $2,600 each month in accordance with the terms of the Agreement before it attempted to unilaterally revoke it. The Board’s conduct over the course of more than three years was consistent only with its acceptance and confirmation of the Retirement Agreement, and inconsistent with the position it takes here. [ 78 ] I would come to this conclusion even if I were to accept the affidavit of Mr. Elliot because my reasons on this issue are grounded in the conduct of the Board for more than three years after the Retirement Agreement was signed. Mr. Elliot’s evidence does not change this.

Should the Retirement Agreement be set aside for a breach of fiduciary duties? [ 79 ] Friends assumes that Ms. Moore was in a fiduciary relationship with the Board of Friends and that she breached her fiduciary duties in 2007 when the Board of Horizons sold its shares in Sunlife and gave the proceeds of that sale to the Board of Friends who then paid those proceeds to Ms. Moore and Mr. Sorenson. [ 80 ] The existence of a fiduciary relationship between two parties depends on proof of various factors. The alleged fiduciary must have undertaken to act in the best interests of the alleged beneficiary.

The alleged fiduciary must also have had the power to affect the legal or substantial interests of the beneficiary. Finally, the beneficiary must be vulnerable to the actions of the person alleged to be a fiduciary. Vulnerability alone is insufficient to render a relationship a fiduciary. Being an agent of a principal does not necessarily correlate to being in a fiduciary relationship: Fridman, at 4.28-4.29. [ 81 ] I find that Ms. Moore was not in a fiduciary relationship with the Board.

I make this finding because, while she acted as an agent of the Board and took directions from it, there is no evidence that she had the power to affect the legal or substantial interests of the Board nor that the Board was vulnerable to her actions [ 82 ] I would come to this same conclusion even if I were to accept Mr. Elliot’s hearsay evidence because his affidavit does not establish that Ms. Moore had the power to affect the legal or substantial interests of the Board nor that the Board was vulnerable to her actions. Should the Retirement Agreement be set aside for conflict of interest?

[83] Friends also alleges that Ms. Moore acted in a conflict of interest by her participation on the Management Committee thatcame up with the formula for the Retirement Program and her later involvement with legal counsel in drafting this Program into acontract. [84] Conflict of interest in the employment context refers to situations where employees take

part in an activity or relationship thatbenefits them and not their employers. It occurs when each party’s personal gains are at odds with each other. It often also involves anelement of non-disclosure: Peso Silver Mines Ltd. v. Cropper, (SCC), [1966] SCR 673, Canadian Aero Service Ltd. v.O'Malley, (SCC), [1974] S.C.R. 592, and Soulos v Korkontzilas, (SCC), [1997] 2 SCR 217, cited inFridman, at 4.34. [85] I find that Ms. Moore did not act in a conflict of interest in her participation on the Management Committee nor in hersubsequent dealings with legal counsel.

I make this finding because it was the Board who placed Ms. Moore on the ManagementCommittee, whose task it was to develop a framework for a Retirement Program. The Board did so with full knowledge that Ms. Moorewas one of only two employees who would benefit from the Program. The Board had been discussing some type of retirement programsince at least 2007, specifically with Ms. Moore and Mr. Sorenson in mind. [86] On this record, there is no evidence that Ms. Moore’s participation on the Management Committee placed her personalinterests at odds with those of the Board nor of Horizons nor of Friends.

Further, it was the Board or the Management Committee, thatinstructed Ms. Moore to retain legal counsel on these matters. On the evidence before me, Ms. Moore shared with Mr. Edwards, andpossibly with others, her communications with legal counsel. On this record, there is no element of non-disclosure of Ms. Moore’sactions. [87] In his affidavit, Mr. Elliot expresses his opinion that Ms. Moore acted in self-interest. His opinion is not admissible evidencein these proceedings.

His affidavit otherwise repeats hearsay evidence from Board members who were present at Board meetings wherethe Retirement Program was discussed, along with the fact that Ms. Moore and Mr. Sorenson would be the only two beneficiaries of thatProgram. Portions of this hearsay evidence are inconsistent with what is recorded in the minutes of these Board meetings. [88] Without direct evidence from these Board members, on which they could be questioned, and without circumstantialguarantees of trustworthiness in relation to the hearsay in Mr.

Elliot’s affidavit, I would come to the same conclusion on the question ofwhether Ms. Moore acted in conflict of interest, even if I were to consider his affidavit.

Could the Retirement Agreement be set aside as there was no meeting of the minds? [89] In its written materials, Friends argues there was no meeting of the minds to form an agreement. [90] In practical terms, if a party to the contract acts in such a way that a reasonable person would believe that the party wasassenting to the terms of the agreement, and if the other party entered into the agreement relying on those actions, then I can concludethere was a meeting of the minds.

The existence of a signed, written contract is strong evidence of an agreement: see, Schluessel v.Margiotta, 2018 ABQB 615, at paras 8-12, citing Smith v. Hughes (1871), L.R. 6 Q.B. 597 (Eng. Q.B.) at 607 and Bawitko InvestmentsLtd. v. Kernels Popcorn Ltd. (1991), (ON CA), 79 D.L.R. (4th) 97, 26 A.C.W.S. (3d) 350 (Ont. C.A.) at para 23 [91] I find there was a meeting of the minds in relation to the Retirement Agreement. I make this finding because the Agreement isclear and unambiguous on its face. It was signed by the Chairman and Treasurer of the Board of Friends.

And for more than three yearsafter its signing, Friends paid Ms. Moore according to its terms. [92] For these same reasons, I would come to the same conclusion even if I were to consider Mr. Elliot’s affidavit.

Could the Retirement Agreement be set aside for being uncertain as to its terms? [93] Friends argues the Retirement Agreement had no legal effect from its inception due to uncertainty in its terms. [94] Where an agreement is incomplete because essential provisions have not been settled or the agreement is too general oruncertain to be valid, or the understanding of the parties is that their legal obligations are to be deferred until a formal contract has beenexecuted, no binding contract will have been created: Schluessel, at paras 6-7, citing Ghitter Property Consultants Ltd. v.

BeaverLumber Co., 2003 ABCA 221 at para 9. [95] I find there is no basis to set aside this Retirement Agreement for uncertainty in its terms. I make this finding because theAgreement, on its face, is clear and unambiguous and the intentions and subsequent actions of the parties demonstrate they understoodthe Agreement without any uncertainties as to its terms. [96] This analysis, and its outcome, would not change even if I were to consider the affidavit of Mr. Elliot.

Could the Retirement Agreement be set aside for there being no consideration? [97] Friends argues the Retirement Agreement should be set aside for lack of consideration. [98] Consideration in contract means giving something of value to which a party is not already entitled. It is given in exchange forsome type of contractual promise. It can take the form of a monetary payment or a promise to do something or a promise to refrain fromdoing something: see, Braiden v. La-Z-Boy Canada Ltd., 2008 ONCA 464, at paras 51-58. [99] I find there was consideration in coming to this Retirement Agreement. In its

preamble, the Agreement acknowledgesFriends’ legal obligation to pay Ms. Moore a monthly amount in exchange for her long years of service for an organization with limitedability to provide her with retirement benefits. This is consideration.

Is the Retirement Agreement unconscionable? [ 100 ] In the end, Friends argues this agreement was unconscionable. [ 101 ] In Uber Technologies Inc. v. Heller , 2020 SCC 16 , the Supreme Court of Canada discussed the doctrine of unconscionability. It noted that it is an equitable doctrine that is used to set aside unfair agreements that resulted from an inequality of bargaining power. It is meant to protect those who are vulnerable in the contracting process from loss or improvidence to that party in the bargain that was made: Uber , at paras 54 and 60. [ 102 ] The doctrine has two components.

The first is an inequality of bargaining power, stemming from some weakness or vulnerability affecting the claimant. The second is an improvident transaction.

The party claiming an agreement was unconscionable must prove both elements: Uber , at para 62. [ 103 ] In proving the first component, the evidence must establish that one party was incapable of adequately protecting itself or its interests and that an undue advantage or benefit secured because of that inequality by the stronger party: Uber , at para 64. [ 104 ] A bargain is improvident if it unduly advantages the stronger party or unduly disadvantages the more vulnerable. Improvidence is measured at the time the contract is formed.

Unconscionability does not assist parties trying to escape from a contract when their circumstances are such that the agreement now works as a hardship against them: Uber , at para 74. [ 105 ] Improvidence is assessed contextually. The question is whether the potential for undue advantage or disadvantage created by the inequality of bargaining power has been realized.

An undue advantage may only be evident when the terms are read in light of the surrounding circumstances at the time the agreement was formed: Uber , at para 75. [ 106 ] Where the weaker party did not understand or appreciate the meaning and significance of important contractual terms, the focus is on whether they have been unduly disadvantaged by the terms they did not understand or appreciate. These terms are unfair when, given the context, they flout the reasonable expectation of the weaker party or cause an unfair surprise: Uber , at para 77. [ 107 ] I find the Retirement Agreement that Ms.

Moore signed with Friends is not unconscionable because there is no evidence before me of inequality of bargaining power between Friends and Ms. Moore. Even if I were to accept the hearsay evidence of Mr. Elliot, this evidence, taken at its highest, does not establish inequality of bargaining power. At most, it establishes that some of the Board members may not have fully understood what was going on. [ 108 ] The Retirement Agreement was signed by the Board Chair and its Treasurer. There is no evidence that they were powerless to negotiate any of its terms.

In fact, its terms nearly mirror the Retirement Program that is reflected in the Board’s minutes. [ 109 ] Even if there were inequality of bargaining power, I would find the Retirement Agreement is not unconscionable because there is no evidence of improvidence. The agreement does not unduly advantage Ms. Moore nor does it unduly disadvantage Friends . [ 110 ] Instead, the record suggests that more than three years after signing the Agreement, and paying Ms. Moore in accordance with it, Friends tried to escape from it when its circumstances changed, and the Agreement now worked a hardship upon it.

The Supreme Court in Heller v Uber specifically rejected this as evidence of improvidence: Uber , at para 74. [ 111 ] Without evidence of inequality of bargaining power and without evidence of improvidence, Friends cannot make out a defence of unconscionability. [ 112 ] I would again come to this same conclusion, even if I were to consider Mr. Elliot’s affidavit. Taken at its highest, it does not demonstrate an inequality of bargaining power nor evidence of improvidence. Conclusion [ 113 ] Friends draws attention to a long course of dealings between Ms. Moore and the Board of Friends and the Management Committee.

It alleges that Ms. Moore breached her employment and fiduciary duties by benefitting from the Retirement Program that the Management Committee designed, and the Board approved. [ 114 ] In the end, this history has minimal relevance on the issue of whether the parties entered into a valid agreement when they signed the Retirement Agreement. [ 115 ] I am satisfied on the evidence before me that the parties entered into an agreement whereby Friends would provide Ms.

Moore with this retirement assistance supplement for life in consideration for her long years of service. [ 116 ] I draw confidence from the letter that Mr. Edwards, the Board Chair at the time, sent to Ms. Moore in which he told her that she was eligible for this supplement. While there are no Board minutes to support this offer, I note the letter was written on Horizons ’ letterhead. [ 117 ] I take further comfort from the written Retirement Agreement that was signed a year later by both the Board Chairman and its Treasurer.

Finally, I take comfort in the subsequent conduct of the parties that were in accord with this Agreement for more than three years. [ 118 ] Friends has not demonstrated that Ms. Moore acted in a conflict of interest nor that she breached any fiduciary duties. The record demonstrates that she was not a member of the Board of Directors, and the transactions of which Friends now complains were not

undisclosed. There is no evidence to establish there was an inequality of bargaining power. [ 119 ] Friends placed great emphasis on the absence of a ratifying resolution of the Board in relation to this Agreement. As I have found here, the subsequent conduct of the Board for more than three years after the Agreement was signed, before it attempted to unilaterally rescind this Agreement, satisfies me that the Agreement was impliedly ratified. The Agreement is not now voidable after the parties relied on it for such a long period of time. [ 120 ] In seeking a trial, Friends has alleged that Ms.

Moore’s credibility is at issue. On the affidavits that I have accepted, there are no issues of credibility that would speak to the issue of the parties’ intentions when they entered this Retirement Agreement. Even if I were to consider Mr. Elliot’s affidavit in this analysis, I would be compelled to conclude that his reliance on hearsay statements, without evidence of circumstantial guarantees of trustworthiness, would lend no assistance in resolving this issue. [ 121 ] On this record, I am satisfied that the test for

summary judgment has been met and that a fair and just determination on the merits can be achieved without a trial. I can make the necessary findings of facts, I can apply the relevant law to those facts, and I can do so in a way that does not result in injustice. [ 122 ] I have found that Friends has not put its best foot forward through its reliance on Mr. Elliot’s affidavit, which I have found inadmissible for its failure to bring itself within any of the hearsay exceptions and for failing to comply with Rules 13.18 (2) and (3) of the Rules of Court .

And, I have found that Friends failed to demonstrate there are any genuine issues requiring a trial. [ 123 ] I have explained throughout these reasons why my conclusions would not change, even if I were to consider Mr. Elliott’s evidence. [ 124 ] In the end, I am left with more than sufficient confidence that I can exercise my discretion and resolve this matter on a

summary basis. [ 125 ] For all these reasons, I allow Ms. Moore’s application for

summary judgment. She is entitled to judgement for damages, plus interest, and specific performance of the Retirement Agreement for the rest of her life, in accordance with the written terms of that Agreement. [ 126 ] The parties may address me on the issue of costs. Heard on the 21 st day of April 2022. Dated at the City of Wetaskiwin, Alberta this 06 th day of June 2022. E.J. Funk J.C.K.B.A. Appearances: Murray L. Engelking for the Plaintiff Ronald T. Smith for the Defendants