Omega Formwork Inc. v. Pomerleau Inc., 2012 NSSC 294

SUPREME COURT OF NOVA SCOTIA Citation: Omega Formwork Inc. v. Pomerleau Inc. , 2012 NSSC 294 Date: 20120801 Docket: Hfx 357699 Registry: Halifax Between: Omega Formwork Inc. Applicant v. Pomerleau Inc. Respondent Judge: The Honourable Justice Patrick J. Duncan Heard: February 9, 2012, in Halifax, Nova Scotia Counsel: John Kulik, Q.C. , for the applicant Bruce T. McIntosh Q.C., for the respondent Joel Sellers By the Court : Introduction

[ 1 ] Omega Formwork Inc. (Omega) makes application for an order to require the respondent, Pomerleau Inc., to pay the applicant the sum of $86,250 representing the Harmonized Sales Tax alleged to be payable on a settlement reached between the parties arising from Actions identified in Supreme Court files as Hfx. 282130 and 304330. The applicant relies upon the enforcement provisions set out in Nova Scotia Civil Procedure Rule 10.04.

Background [ 2 ] Pomerleau entered into contracts with Dexter Construction Ltd. (Dexter) for the supply of goods and services to be used in the construction of both of the Halifax and Herring Cove Sewage Treatment Plants. Pomerleau retained Omega as subcontractor for the concrete work required for the Pomerleau projects. [ 3 ] Omega alleged nonpayment of its accounts by Pomerleau and filed two actions that named Pomerleau, Dexter and Halifax Regional Municipality as defendants. Pomerleau was engaged in its own dispute with Dexter and the Municipality.

The parties agreed to submit the disputes to arbitration. [ 4 ] Concurrent negotiations to settle the claims of Omega against Pomerleau were conducted by an exchange of written proposals between John Kulik Q.C., counsel for Omega, and Bruce MacIntosh Q.C., counsel for Pomerleau. The final documents in the sequence consisted of a letter from Mr. Kulik dated July 7, 2010 which contained a proposal that was accepted by Pomerleau in a letter from Mr. MacIntosh dated July 28, 2010. Mr.

MacIntosh enclosed a signed copy of the July 7, 2010 offer and added the following notation: "Settlement as reflected in all exchanges between counsel." [ 5 ] The July 7, 2010 letter required Pomerleau to pay Omega two sums totaling $575,000. The first payment of $300,000 was due by July 15, 2011 and characterized as a non reimbursable "partial payment in settlement of Omega's claim". The agreement called for cooperation in advocating the Omega claim as part of the Pomerleau representations in the arbitration. Omega retained control of the amount to be claimed in arbitration on account of its claim.

However, it surrendered that control to Pomerleau absolutely if Pomerleau paid Omega: … an additional amount of $275,000 over and above the $300,000 referred to in Clause 1 of the Agreement, all amounts which will be payable to Omega within 30 days of settlement. [ 6 ] To fulfill another term of the Settlement Agreement, the applicant was required to discontinue the two pending court actions. (which it did in August of 2010) [ 7 ] In Mr.

McIntosh's letter of July 28, 2010 he states: Upon receipt of the filed Notices of Discontinuation, we will forward the Pomerleau cheque payable to Omega in the amount of $300,000. [ 8 ] Pomerleau ultimately resolved its dispute with Dexter and HRM, thus triggering the Agreement's requirements to pay the sums of $275,000 and $300,000.

Pomerleau ’ s position in this application is that it had always intended that its liability to Omega under the Settlement Agreement would total $575,000 inclusive of HST. [ 9 ] Omega submits that the Agreement was intended to be $575,000 plus HST and therefore claims an amount of $86,250, representing 15% of the total amount. Issues 1. (

a) Does the court have jurisdiction pursuant to Nova Scotia Civil Procedure Rule 10.04 to provide a remedy to the applicant?

(

b) If not, is there another legal basis upon which the applicant's claim may be founded? 2. Does the Settlement Agreement contain an implied term that Pomerleau was liable to pay an additional 15% for taxes, beyond the otherwise agreed settlement amount of $575,000? Analysis: Issue 1(a) : Does the court have jurisdiction pursuant to CPR 10.04 to provide a remedy to the applicant? [ 10 ] The applicant relies upon CPR 10.04 to enforce what it says are the terms of a Settlement Agreement within the meaning of Rule 10. That rule states: 10.01

(1) This Rule applies to a settlement of a proceeding or of a claim in a proceeding, and includes both of the following: (

a) a formal way to make an offer that may affect how costs are awarded; (

b) judge-assisted alternative dispute resolution that is voluntary and flexible. … 10.04

(1) A party who alleges that, after a proceeding was started, the parties reached agreement for settlement of the proceeding or of a claim in the proceeding may make a motion for an order giving effect to the agreement.

(2) The judge who hears the motion may do any of the following: (

a) declare that an agreement was, or was not, made and is, or is not, enforceable; (

b) declare the terms of an agreement; (

c) grant an order enforcing an agreement according to its terms; (

d) order a trial under Rule 4 - Action or a hearing under Rule 5 - Application and give directions about the issues to be determined. The applicability of this provision is in issue. [ 11 ] Rule 10.04 permits a "motion" to be made in a pending action or application. A motion is an interlocutory step in an existing proceeding. See, Rule 22.01 . Omega filed Notices of Discontinuance of the two actions that were settled by this Agreement.

As such there is no "proceeding" or "claim" from which the court could find jurisdiction under Rule 10 to hear and provide the requested remedy. [ 12 ] Recognizing the problem, counsel for Omega has presented this claim as an original Application, which is not a procedure provided for under Rule 10 .

[ 13 ] In light of these facts, and the provisions of the Civil Procedure Rules , I conclude that the applicant's attempt to enforce its view of the Settlement Agreement cannot be based on the provisions of Rule 10 . I am reinforced in this view by Rule 10.04(2) (

d) which provides, as a remedy, the authority to order a trial or application upon breach of a Settlement Agreement. This is a remedy that is not available where the proceeding has been discontinued, as here. Issue 1(b) : Is there another legal basis upon which the applicant's claim may be founded? [ 14 ] The respondent takes the position that the Settlement Agreement is a contract and should be interpreted in accordance with the law of contract. I agree.

The exchanges of correspondence by counsel ending with the July 28, 2010 letter reflect the fundamental legal elements of contract. e.g., offer, acceptance, consideration, and intention to create legal relations. [ 15 ] Therefore, I conclude that the settlement entered into by the parties should be treated as governed by the law of contract, and that any remedy that may be available to resolve this dispute is in contract.

Issue 2 : Does the Settlement Agreement contain an implied term that Pomerleau was liable to pay an additional 15% for taxes, beyond the otherwise agreed settlement amount of $575,000? [ 16 ] On its face, the Agreement appears to be a complete statement of the terms of the settlement. The correspondence between counsel up to an including Mr. MacIntosh's letter of acceptance dated July 28, 2012, always referred to the amounts to settle as fixed sums. [ 17 ] The plain language of the Agreement is consistent with the respondent's position that it intended its liability to be fixed in the stated amounts.

If the applicant expected some greater amount for applicable taxes then it would be reasonable for the respondent to believe that should have been stated. It is, after all, a substantial sum of money for the applicant to have left unaddressed. [ 18 ] The respondent submits that to permit the applicant to succeed encourages a deceptive practice of negotiating a price to settle that is not truly representative of the actual cost to the payor.

It may, of course, be equally true that a payor remains silent on the issue hoping to escape an HST liability that it knows it would otherwise be liable for. [ 19 ] I am urged by the applicant to look to extrinsic evidence to find support for the remedy it seeks. While conceding that the letters constituting the Agreement make no reference to the settlement amount requiring an additional payment for HST, the applicant notes that the agreement does not say that the settlement amount is "all inclusive".

This is important, says Omega, because the construction contracts between the parties upon which the original amounts were claimed specified that amounts to be paid were subject to an additional payment for HST. It says then that the Settlement Agreement should be interpreted in a manner that is consistent with the invoicing and payment provisions of those contracts. [ 20 ] The applicant also points to the provisions of the Excise Tax Act R.S.C., 1985, c.

E-15which make it the respondent's responsibility to pay applicable taxes on a supply of services. [ 21 ] Both parties agree that HST is payable on the amount paid for the "supply of services". Both understand that the recipient of the supply (Pomerleau) pays the provider of the services (Omega) an amount for its service, and a further amount for the HST which it is then Omega's responsibility to remit to the government because of its statutorily deemed role as agent of the government for that purpose. [ 22 ] Omega argues that the settlement amount only satisfies Omega's claim for the supply of services.

Taxes payable to the government do not compensate Omega for its supply of services and Pomerleau should pay that extra amount even though the Agreement is silent on the question. [ 23 ] In Canada (Attorney General) v. Rostrust Investments Inc . 2010 ONSC 3986 Polowin J., reviewed some general legal principles to follow in the

interpretation of contracts:

[39] I turn now to the general legal principles applicable when interpreting a contract. These principles were summarized in thedecision of the Ontario Court of Appeal in Ventas, Inc. v. Sunrise Senior Living Real Estate Investment Trust, 2007 ONCA 205 ,[2007] O.J. No. 1083 (Ont. C.A.). The Court of Appeal held at paragraph 24, that a commercial contract is to be interpreted as follows: (

a) as a whole, in a manner that gives meaning to all of its terms and avoids an

interpretation that would render one or moreof its terms ineffective; (

b) by determining the intention of the parties in accordance with the language they have used in the written document andbased upon the "cardinal presumption" that they have intended what they have said; (

c) with regard to objective evidence of the factual matrix underlying the negotiation of the contract, but without reference tothe subjective intention of the parties; and (to the extent there is any ambiguity in the contract), (

d) in a fashion that accords with sound commercial principles and good business sense, and that avoid a commercial absurdity. [40] Thus, to the extent that it is possible to do so, a contract should be construed as a whole and effect should be given to all of itsprovisions. Further, its provisions should be read, not as standing alone, but in light of the contract as a whole and the other provisionsthereof (see Scanlon v. Castlepoint Development Corp. (ON CA), [1992] O.J. No. 2692 (Ont. C.A.) at para. 89.

Inaddition, it is a cardinal rule of the construction of contracts that the various parts of the contract are to be interpreted in the context of theintentions of the parties as evident from the contract as a whole (see B.C. Checo International Ltd. v. British Columbia Hydro and PowerAuthority, (SCC), [1993] 1 S.C.R. 12 (S.C.C.) at para. 9). The court's aim is to advance the intention of the parties atthe time they entered into the contract. (See Consolidated-Bathurst Export Ltd. v. Mutual Boiler & Machinery Insurance Co., (SCC), [1980] 1 S.C.R. 888 (S.C.C.) at page 10).

There should not be an ex post facto reconstruction of intention. The issue of intention was considered in the case of Toronto-Dominion Bank v. Leigh Instruments Limited (Trustee of), (ON SC), [1998] O.J. No. 2637 (Ont. Gen. Div.); aff'd (ON CA), (1999), 45 O.R. (3d) 417 (C.A.). Winkler J.,as he then was, stated the following at paragraphs 403-405, 407 410: PRINCIPLES OF CONTRACTUAL

INTERPRETATION 403 The aim of the court, in construing a written agreement, is to determine the intentions of the parties to the agreement, andin this regard, the cardinal presumption is that the parties have intended what they have said. Their words must be construed as theystand. See: Chitty on Contracts Volume 1, General Principles, 27th ed. (1994) at 580. 404 Where the agreement has been reduced to writing, the parol evidence rule operates to prohibit the introduction of extrinsicevidence to vary the written contract. This rule of

interpretation is enunciated in G.H.L. Fridman, The Law of Contract in Canada, 3rded. (Toronto: Carswell, 1994) at app. 455-456: The fundamental rule is that if the language of the written contract is clear and unambiguous, then no extrinsic parolevidence may be admitted to alter, vary, or interpret in any way the words used in the writing. See also: Hawrish v.

Bank of Montreal, (SCC) [1969] S.C.R. 515 per Judson J. 405 This is consistent with the principle that where a document purports on its face to be the final and conclusive expression ofthe parties' agreement, the document will be taken to be a reliable record of the parties' latest agreement, and evidence of the negotiationsleading up to it will not be admissible …

407 The court need not be confined to a strict, literal

interpretation of the language of the document however, and may admitevidence of the "factual matrix" or circumstances surrounding the conclusion of the agreement as an aid in

interpretation. … 408 The Supreme Court of Canada has adopted the notion that a court may look at evidence of the surrounding circumstanceswhen construing a document. In Hill v. Nova Scotia (Attorney General), (SCC), [1997] 1 S.C.R. 69, the court citedwith approval the dicta of LaForest J. (as he then was), in White, Fluhman and Eddy v. Central Trust Co. and Smith Estate (1984), (NB CA), 54 N.B.R. (2d) 293 at 310-311: What the statement quoted means is that in determining what was contemplated by the parties, the words used in adocument need not be looked at in a vacuum.

The specific context in which a document was executed may well assist in understandingthe words used. It is perfectly proper, and indeed may be necessary, to look at the surrounding circumstances in order to ascertain whatthe parties were really contracting about. 409 From these authorities can be gleaned certain principles which should guide the court in interpreting an agreement. Thedocument should be looked at as a whole, with each contractual term considered in the context of the entire document. See: G.H.L.Fridman, The Law of Contract in Canada, 3rd ed. (Toronto: Carswell, 1994) at 469.

The court should make every effort to construethe document on its face, without regard to extrinsic evidence. 410 Where an agreement is clear and unambiguous on its face, the parol evidence rule operates to prohibit admission ofevidence to alter or vary the written terms of the contract. However, the court may admit evidence of the surrounding circumstances,including evidence of the commercial purpose of the contract, the genesis of the transaction, the background, the context, and the marketin which the parties were operating.

In this regard, evidence to be admitted must be objective in the sense of what reasonable persons inthe position of the parties would have had in mind, rather than subjective evidence of the parties' actual intentions. (emphasis added) [24] If I were to determine this dispute solely on the language of the Agreement, then the applicant would not succeed in its claimfor payment of an additional amount. In my view, a reasonable person would say that Pomerleau promised to pay Omega $575,000 infull settlement of the latter's claims, not some greater amount as Omega claims.

Where the language appears clear and unambiguous thecourts are reluctant to look outside the terms of the agreement to determine whether some other intention should be ascribed to theparties. [25] However, given the position of the applicant, I am obligated to consider whether it is appropriate to look at extrinsic evidenceto determine whether the applicant's sought after remedy has a valid foundation in law and on the facts of this case. [26] In The Law of Contracts, 1st ed., (McCamus) (Toronto: Irwin, 2005), the author says at p. 202 that: Subject to the rules of

interpretation of agreements, evidence of oral or written pre-contractual communications may be admissible forthe purpose of aiding in the proper

interpretation or construction of ambiguous provisions of the agreement. [27] The applicant's position poses a question as to whether, in the context of the relationship of these parties, the terms areambiguous and only able to be properly understood by considering evidence of other contractual customs that existed between theparties. [28] I am satisfied that to properly assess that argument I must review extrinsic evidence of communications between the parties thatare not encompassed in the language of the agreement. [29] Cory J.A., writing in G. Ford Homes Ltd. v. Draft Masonry (York) Ltd. (1983) (ON CA), 43 O.R. (2d) 401,at p. 403 stated:

When may a term be implied in a contract? A court faced with that question must first take cognizance of some important and time-honoured cautions. For example, the courts will be cautious in their approach to implying terms to contracts. Certainly a court will not rewrite a contract for the parties. As well, no term will be implied that is inconsistent with the contract. Implied terms are as a rule based upon the presumed intention of the parties and should be founded upon reason.

The circumstances and background of the contract, together with its precise terms, should all be carefully regarded before a term is implied. As a result, it is clear that every case must be determined on its own particular facts. [ 30 ] Having concluded that I am prepared to look outside the text of the written Agreement, I turn now to a consideration of the circumstances and background of the construction of the Agreement. Evidence of the intentions of the Parties [ 31 ] The affidavit evidence of Patrick Stiles, the Regional Director, Atlantic, for Pomerleau was filed in response to this application.

He states that he was one of two Pomerleau employees that instructed legal counsel as this Agreement was negotiated. He testified that: 4. At all material times to these proceedings it was Pomerleau's intention and belief, in the absence of any separate reference to HST that the total settlement offer of $575,000 was inclusive of HST. There was no "separate reference to HST" in the letters comprising the Agreement. [ 32 ] Mr. Stiles' evidence may be viewed as self-serving, coming after the issue was presented in a court proceeding.

However, it was not tested on cross-examination and there is no contrary evidence presented by the applicant. [ 33 ] The applicant has adduced no evidence to state what its intention was at the time of the negotiation. There is some evidence, that I will refer to later, that assists in assessing what the applicant thought the payment conditions were. Customary Business Practices [ 34 ] The contracts and invoices submitted and paid prior to this dispute were specific in requiring HST to be in addition to the amount for services.

The applicant says that it is precisely because of this established practice, as well as the standard practices of the construction industry, together with the respondent's business sophistication, that makes it reasonable to expect that HST would be payable in addition to any amount agreed upon to achieve settlement, whether or not it was stated in the Agreement.

The applicant submits that the stated settlement amounts reference compensation for unpaid invoices for taxable services rendered, not the taxes, which were to be an extra. [ 35 ] There is no dispute that the original contracts for services specified that HST was in addition to any amount invoiced for supply of services. The invoices submitted by Omega to Pomerleau distinguished the two amounts. The Statements of Claim filed by Omega each sought specified amounts "plus HST". See paragraph 10 of each Claim. [ 36 ] However, as previously noted, the same language was not contained in Mr. Kulik's letters to Mr.

McIntosh, which letters are dated May 3, 2010, June 9, 2010 and July 7, 2010. [ 37 ] The respondent suggests that the only time the question of HST arose was in the following excerpt taken from Mr. Kulik's letter of May 3: 4. If Pomerleau:

(

a) wishes to settle its claim against Dexter prior to the completion of the arbitration without the consent and participation of Omega concerning the Omega portion of the Pomerleaus's claim; and (

b) wishes Omega to abandon its entire claim with respect to Herring Cove, then Pomerleau may settle with Dexter in Pomerleaus's sole discretion but Pomerleau will have to pay Omega an additional amount of $350,000 over and above the $300,000 referred to in Clause 1, all amounts to be paid within 30 days of settlement.

Only under this scenario would Omega agree to give up both its discretion with respect to settlement of its Halifax claim ( over $1.02 million ) and also its entire claim with respect to Herring cove ( $338,000+ ) (emphasis added) [ 38 ] The respondent suggests that the descriptors "over" and "+" were "shorthand references" to amounts claimed for HST.

The respondent draws the conclusion that these references show a distinction in the mind of the applicant between the claim, which specified an amount "plus", and the amounts discussed to settle which always referenced global amounts to settle without reference to an amount "plus". While the respondent may be correct, the evidence is too ambiguous to put any weight on that

interpretation. Mr. Kulik's terminology is equally consistent with an inference that the amount claimed for the supply of services, excluding tax, was in excess of the $1.02 million and $338,000. [ 39 ] The history of contractual relations between these two parties was that taxes were specifically described as payable in addition to amounts payable for services. Invoices submitted by Omega showed the HST payable as a separate line item.

Relying then upon past custom, the respondent could reasonably conclude that the applicant would have required the break out of tax liability in the language of the Agreement if it was intended to be a term of the settlement. The applicant never made such a demand. [ 40 ] These parties are both sophisticated business operations that would be keenly aware of their respective obligations to pay or collect and remit taxes on the supply of services. It is hard to imagine that they failed to address their respective minds to this question.

If Omega wanted it paid as an extra then, following their past practice, I would have expected them to say so. [ 41 ] I have noted the evidence that Pomerleau did consider this question and intended the amounts agreed to be paid as inclusive of HST. There was no evidence from a principal of Omega that speaks to this issue. However, there is some evidence upon which a mutual intention could be inferred. [ 42 ] I earlier referenced Mr. McIntosh's comment in the letter of acceptance dated July 28, 2010 that he would be forwarding a cheque in the amount of $300,000 as the first payment to Omega. Mr.

Kulik's responding letter of August 23, 2010 concurs that this is the amount payable: I look forward to receiving the Pomerleau cheque payable to Omega in the amount of $300,000. [ 43 ] In a follow up letter of August 27, 2010, Mr. Kulik states: … I was mistaken in the delivery date of the initial payment in the amount of $300,000, which is due on or before July 15, 2011. These were two opportunities for Mr.

Kulik to point out that the actual amount owing was $300,000 plus 15% thereon for HST. i.e., $45,000, but he did not do so. [ 44 ] The past custom between these parties was that Pomerleau issued a single cheque that covered the supply of services costs and the taxes payable thereon. When Mr. Kulik's letters suggest that a single cheque for $300,000 was expected there was no mention that a second cheque was also expected for HST. For Pomerleau to be expected to issue two cheques, one for settlement and the other for HST on the Settlement amount would be inconsistent with the past practices of these two parties.

These line items had never previously been

segregated for payment and there was no request to do so for purposes of paying out the Settlement amount. [ 45 ] In

summary, the past practices for setting out payment terms in writing, for invoicing, and for payment all stand in contrast to the terms of this agreement. The custom was to specify in writing when HST was extra; to submit one invoice with the two charges delineated before totaling for a single amount to be paid; and for Pomerleau to issue one payment for that total amount. Here there was no written requirement to segregate; there was no stated claim that HST was extra; and the requested terms for payment by cheque matched the amount of the settlement.

No timely demand was made for HST to be paid and to do so as a separate item would not be consistent with past custom. Role of the Excise Tax Act [ 46 ] The applicant suggests that the Excise Tax Act requires the applicant to pay the tax and that the Settlement Agreement must be interpreted as subject to a statutory obligation upon the respondent to remit the amount of tax payable on the settlement amount. [ 47 ] The respondent states it was alive to the obligation to remit tax and that the amount paid was intended to be inclusive of the applicable taxes.

So this is not a dispute as to whether taxes were payable; which party was responsible to pay the taxes; or who was to remit the taxes to the government. Rather it is a dispute as to whether the terms of the Agreement can be interpreted to say that the amount paid by Pomerleau to Omega should be taken to have represented only payment for the supply of services, or was for the supply of services and the taxes applicable thereon. [ 48 ] I find that the statutory provisions of the Excise Tax Act do not assist in resolving this dispute.

Conclusion [ 49 ] The applicant seeks payment of $86,250 representing an amount equivalent to the HST payable on the defined amounts set out in a Settlement Agreement reached between the parties. [ 50 ] The language of the Agreement does not impose such a requirement.

For the applicant to succeed, the Agreement must be shown to have an implied term requiring the respondent to make this payment. [ 51 ] The burden rests upon the applicant to prove on the balance of probabilities that, having regard to the facts and the law, it is appropriate to imply a term into the Settlement Agreement that requires the respondent to pay the sum of $86,250 more than the amount stated in the agreement. I find that the evidence does not meet this burden.

The plain language of the agreement is a sufficient basis upon which to reach the conclusion that the respondent is not required to pay an additional amount to the applicant beyond that stated in the Agreement. [ 52 ] The applicant says that this conclusion must be rejected because a consideration of the surrounding circumstances demonstrates that a term should be implied that requires the payment by Pomerleau. I reject this argument as well. [ 53 ] First, the respondent denies that such an implied term was intended by them.

That evidence is not refuted. [ 54 ] Second, the customary practice of the parties was to state that HST was on top of any amount invoiced. That was not done here. [ 55 ] Third, both parties are sophisticated business entities which would understand that if HST was to be in addition to the amount agreed upon then it should have been so stated, particularly so as to conform to past practices and agreements between them. The failure to make that inclusion militates against the applicant's position.

[ 56 ] Fourth, counsel for the applicant on two occasions referred to his expectation of receiving a cheque from the respondent and in the exact amount set out in the Agreement. There was no mention of a second cheque, or any other form of payment, for HST. This is indicative of the applicant's true understanding of the agreement. [ 57 ] Finally, the past practice was that Omega sent a single invoice to Pomerleau which showed the amount owing for their services, a separate amount for the HST, and a total of the two. Pomerleau then issued a single cheque to Omega for the total amount.

It would be inconsistent with that practice to require the respondent to pay the settlement amount with one cheque and the HST in a separate cheque. It was never done before; why would it happen after the Settlement? [ 58 ] Based on the evidence it seems that one of four things happened in this case. The first is that Omega deliberately failed to mention an HST payment, possibly recognizing that Pomerleau would not settle for the larger amount, in which case it is not entitled to now claim HST payable as an implied term.

Alternatively, Omega intended that the amount in the Agreement was inclusive of HST and only after the fact decided to pursue an amount for HST. Omega cannot succeed in this scenario as the demand was made after the settlement was committed to writing and the bargain was already concluded. The third alternative is that Omega simply did not consider the question until after the bargain was concluded. Again, Omega's failure to negotiate the HST payment as an extra is not a reason to imply a term requiring Pomerleau to pay it.

The final alternative is that Omega always intended that HST was payable on the settlement amount as an implied term of the Agreement. As I have already concluded the evidence fails to establish this to be the case. Indeed, it seems remarkable to me that given the history of this relationship that they would make such an assumption during the negotiations and conclusion of the Settlement Agreement. [ 59 ] Having failed to meet the burden upon it, Omega's application is dismissed. Costs [ 60 ] If the parties are unable to agree as to costs on this application, I will receive their written submissions on a

schedule to be agreed upon. J.