EnerMerge Inc. v Comgen Power Solutions Ltd., 2024 ABCJ 31

In the Alberta Court of Justice Citation: EnerMerge Inc. v Comgen Power Solutions Ltd., 2024 ABCJ 31 Date: 20240208 Docket: P2302900244 Registry: Red Deer Between: EnerMerge Inc. Plaintiff - and - Comgen Power Solutions Ltd. Defendant Decision of the Honourable Justice G.A.G.

Yake Introduction [ 1 ] This dispute arises from a Purchase Contract dated January 21, 2022 for the purchase of a 2011 Cummins 500 kW diesel generator (the “Generator”) by the Plaintiff/Defendant by Counterclaim, Enermerge Inc. (“EMI”) from the Defendant/Plaintiff by Counterclaim, Comgen Power Solutions Ltd. (“Comgen”). [ 2 ] The purchase price set out on the Purchase Agreement is $100,000.00 plus GST in the amount of $5,000.00. [ 3 ] It is common ground that the Generator was delivered to EMI on February 17, 2022, and that EMI has paid Comgen $70,000.00, and that EMI has withheld $35,000.00. [ 4 ] EMI has sued Comgen for damages that allegedly arose from Comgen’s failure to deliver an operable Generator, as more particularly described below. [ 5 ] Comgen disputes those allegations and has counterclaimed for the balance of the purchase price, freight costs and contractually stipulated interest. [ 6 ] The trial of this Action was held in on December 19 and 21, 2023.

[ 7 ] On December 19, 2023, immediately before the trial was to start, legal counsel for EMI applied to cease to act. EMI through its representative Bradley Murray supported that application, and advised the Court that EMI was prepared to immediately proceed to trial without legal counsel. Therefore, legal counsel’s application to cease to act for EMI was granted, and the trial proceeded without legal counsel representing EMI. [ 8 ] Comgen has been represented by legal counsel throughout these proceedings. [ 9 ] Bradley Murray, Steve Murphy and Barry Friesen were called as witnesses by EMI.

After a voir dire was held Steve Murphy was qualified as an expert witness to give opinion evidence about servicing, commissioning, repairing and maintaining Cummins generators. [ 10 ] Marty Hamm testified for Comgen. [ 11 ] After all of the evidence was heard both parties made brief oral arguments, and an adjournment was granted so that written submissions could be filed. EMI’s written submissions were filed on January 9, 2024.

Comgen’s written submissions were filed on January 16, 2024. [ 12 ] My review of EMI’s Written Argument leads me to believe it was drafted by legal counsel, even though no lawyer is identified as the author of that document. [ 13 ] I have read written submissions of both parties and the case authorities cited therein.

A Brief Synopsis of the Civil Claim [ 14 ] The Civil Claim was drafted and filed by legal counsel for EMI. [ 15 ] EMI claims $58,787.00 as damages, or in the alternative, damages in the amount of $50,000.00, including damages for loss of business estimated at not less than $20,000.00. [ 16 ] There are no particulars in the Civil Claim describing the basis for EMI’ s claim for damages for loss of business. [ 17 ] EMI alleges that upon delivery to its site the Generator was damaged and was missing critical components that rendered it inoperable, and that it incurred expenses making the Generator operable and fit for the purpose for which it was required by EMI, which was to generate 500 kW of energy.

EMI alleges the Generator provided to it could only generate 400 kW of energy. [ 18 ] EMI’s Civil Claim alleges that Comgen made false, fraudulent or negligent statements and misstatements during pre-contract negotiations, thereby inducing EMI to enter into the purchase agreement. However, during oral submissions, after all the evidence had been presented, EMI withdrew its allegations of fraudulent and/or negligent misstatements. [ 19 ] The Civil Claim does not allege that Comgen made any innocent misrepresentations, or that the Purchase Agreement was fundamentally breached.

Nevertheless, in its written submissions EMI alleges that Comgen made innocent misrepresentations and fundamentally breached the Purchase Contract. [ 20 ] The Civil Claim does not plead any of the provisions of the Sale of Goods Act of Alberta, or any implied warranties. Nevertheless, in both oral submissions and written submissions EMI relied upon the implied warranties described at sections 16(2) and (4) of the Sale of Goods Act of Alberta.

EMI’s Claim for Setoff Not in the Pleadings [ 21 ] A deposit held by Comgen for EMI in the amount of $400,000.00 in relation to an unrelated transaction was mentioned during the trial and in EMI’s oral and written submissions. [ 22 ] No claim for setoff has been filed in this action by EMI. No particulars describing the transaction relating to the $400,000.00 deposit can be found in the pleadings, and there were only brief references to that deposit during the trial.

Nevertheless, EMI says that funds from that deposit could be “...used to net against any outstanding amount that [EMI] may owe to Comgen for the generator package”. (EMI Written Argument at paragraph 4.8) A Brief Synopsis of the Dispute Note [ 23 ] Comgen says that the Generator was sold to EMI “as is, with no warranties” as set out in the Purchase Contract. Comgen also relies upon an Indemnity clause and an Entire Agreement clause found in the Purchase Contract. [ 24 ] The Dispute Note does not mention the Sale of Goods Act , innocent misrepresentation or fundamental breach of contract.

This is not surprising, given the absence of any mention of those issues in EMI’s pleadings. [ 25 ] In response to EMI’s written submissions, Comgen says that the

section 54 of Sale of Goods Act applies, and the Parties have contracted out of the Sale of Goods Act implied warranties. [ 26 ] Comgen also cites r. 13.6(3)(

r) of the Alberta Rules of Court, which requires that pleadings include a statement of any matter on which a party intends to rely that may take another party by surprise, including a provision of an enactment. [ 27 ] Comgen’s Dispute Note also pleads that EMI has failed to mitigate any damages it may have suffered. A Brief Synopsis of the Counterclaim

[ 28 ] Comgen’s Counterclaim alleges that EMI owes it a total of $63,741.77 for the unpaid balance of the purchase price ($30,000.00), GST ($5,000.00), freight ($17,805.90) and contractually stipulated interest ($10, 935.87 calculated at 24% per annum, as of February 17, 2022). Comgen’s written submissions say that its Counterclaim has increased to $77,249.97 due to further accumulated interest from February 17, 2022 to December 21, 2023. [ 29 ] Comgen has waived the amount of its claim that exceeds the monetary jurisdictional limit of this Court, which at the date the pleadings were filed was $50,000,00.

A Brief Synopsis of the Dispute Note to the Counterclaim [ 30 ] The Dispute Note to the Counterclaim was drafted and filed by counsel for EMI. [ 31 ] In response to the Counterclaim, EMI repeats many of the allegations found in the Civil Claim and pleads that payment of the balance owing on the Purchase Contract was held back because the complete Generator was not delivered to it. [ 32 ] The Dispute Note to the Counterclaim does not specifically address Comgen’s claim for contractually stipulated interest at 24% per annum.

Facts [ 33 ] I make the following findings of fact based on the evidence presented during the trial. [ 34 ] At all material times EMI was in the business of integrated natural gas production, electrical power generation and greenhouse operations in Alberta. [ 35 ] Although not legally trained, EMI representatives Bradley Murray and Barry Friesen are sophisticated businessmen with training and experience in the businesses conducted by EMI. [ 36 ] Comgen’s business includes sourcing, commissioning and maintaining electrical generation equipment, and Marty Hamm is a sophisticated businessman with significant experience in these areas of Comgen’s business. [ 37 ] On December 29, 2021 Mr.

Murray sent Mr. Hamn an email message inquiring whether he was aware of any available portable diesel generators in the 200kW to 500kW range. On the same day Mr. Hamm replied by email that Comgen had a used Cummins 500 kW diesel generator in its inventory, and that offers “north of $100,000.00 are being accepted”. The Generator was described by Mr.

Hamm as “serviced and ready”. (Exhibits 1 and 2) [ 38 ] The Generator was at that time in the possession of Crown Capital Partners Inc. (“Crown”). [ 39 ] The Generator was originally purchased out of Colorado, U.S.A., and in 2016 it was installed in the Twin Rinks Arena in Burlington, Ontario. At the time of that sale it was a 480 volt unit with a main generator controller that managed the overall operation of the Generator.

After the Generator arrived in Burlington it was retrofitted by Steve Murphy with a 600 volt alternator in lieu of its original 480 volt unit. (Exhibit 6) [ 40 ] The CSA certified nameplate describing the Generator is depicted in the photograph entered as Defendant’s Document 26, with the electrical configuration of 480 volts, 750 amps and 498 kW output capacity. [ 41 ] At no time did EMI specifically advise Comgen of the purpose for which the Generator was required by EMI. [ 42 ] After December 29, 2021 and before January 8, 2022, Mr.

Hamm, acting on behalf of Comgen offered to sell the Generator to EMI for $120,000.00 (CDN) FOB Mississauga, Ontario. This sale price was based on the cost that Comgen would incur to acquire the Generator from Crown ($100,000.00) plus an allowance for any costs Comgen would incur to repair and service it, plus overhead costs and profit to Comgen. [ 43 ] By email sent on December 30, 2021 Crown employee Adam Jenkins sent Mr. Hamm photographs of the Generator.

The email attached to the photographs said that the controls for the Generator were removed, and that it had 168 hours on it. (Defendant’s Documents at pp.4 - 39) [ 44 ] I accept Mr. Hamm’s undisputed testimony that 168 hours is a low number of hours for a this model of a Cummins diesel generator. [ 45 ] Two of the photographs appear to show a control module on the Generator. (Defendant’s Documents at pp. 24 & 25). [ 46 ] By email to Mr. Murray dated December 30, 2021 Mr. Hamm sent those photographs to Mr. Murray. In that email Mr.

Hamm did not mention that the generator control had been removed. [ 47 ] Sometime between December 30, 2021 and January 10, 2022 Mr. Hamm directed Oleg Lapidus of Total Power Installations to attend at Crown’s site and look at the Generator. Mr. Lapidus did so, and on January 10, 2022 he advised Mr. Hamm that the Generator did have an installed control panel. (Defendant’s Documents at p. 48). [ 48 ] Mr. Hamm testified that he spoke with Mr.

Murray on January 8, 2022, and that during the course of that conversation they agreed that the purchase price to be paid to Comgen by EMI would be reduced from $120,000.00 to $100,000.00, provided that the Generator was sold on on “as is, no warranty basis”.

[ 49 ] Mr. Murray denied having that conversation with Mr. Hamm. [ 50 ] For the reasons described below I accept Mr. Hamm’s testimony and I reject Mr. Murray’s testimony on this issue. [ 51 ] I accept this evidence because Mr. Hamm’s testimony on this issue, and his testimony as a whole, was clear, cogent and consistent throughout direct examination and cross examination. In short, he was a truthful witness with a good memory of the circumstances surrounding this transaction. As more particularly described below, the same cannot be said of Mr. Murray. [ 52 ] Based on Mr.

Hamm’s testimony and the email message entered at page 49 of the Defendant’s Documents I find that on January 12, 2022 Mr. Hamm again spoke with Mr. Murray and told him this was a “pass through deal”, and it was verbally agreed that: (

a) Comgen would acquire the Generator from Crown for $100,000.00 and Comgen would sell it to EMI for $100,000.00 (i.e. Comgen would make no profit on this sale); (

b) EMI would pay 70% of the purchase price (i.e. $70,000.00) to Comgen prior to shipment of the generator; (

c) the balance owing on the purchase price plus GST (i.e. $35,000.00) would be paid by EMI to Comgen upon EMI receiving the generator; and (

d) EMI would pay for all the costs incurred by Comgen for shipping the Generator to EMI’s site from Mississauga, Ontario. (Defendant’s Documents at pp. 49 & 68) [ 53 ] Mr. Hamm’s testimony describing these conversations is corroborated by the Purchase Contract and invoice # 20365 described below, which incorporate the terms of the Agreement that he testified were discussed on January 8 and 12, 2022. [ 54 ] By email dated January 14, 2022 Mr. Hamm sent Mr. Murray a copy of the Purchase Contract at issue in this litigation, and a copy of Comgen’s invoice # 20365 in the amount of $70,000.00. Both the invoice and the Purchase Contract clearly state, inter alia , that: (

a) the Generator was sold “as is with No Warranty” (capitalized in the original and copies of these documents); (

b) the purchase price was $100,000.00; (c) $70,000.00 was due as a deposit; (

d) the balance of $35,000.00 was due upon EMI’s receipt of the Generator at EMI’s site in Alberta. (Defendant’s Documents at pp. 50-54) [ 55 ] Invoice # 20365 is endorsed “Past due accounts subject to service charge of 2% per month (24%per annum) or maximum permitted by law”. [ 56 ] The Purchase Contract does not contain any term or condition describing any interest payable on past due accounts. [ 57 ] The Purchase Contract contains the Default, Indemnity and Entire Agreement clauses that Comgen relies on in this litigation. [ 58 ] By January 25, 2022 EMI had paid Comgen the $70,000.00 deposit, and had signed and returned invoice # 20365 and the signed Purchase Contract to Comgen.

Comgen quickly paid Crown the $70,000.00 deposit it had received from EMI. Subsequently, Comgen paid Crown $35,000.00 as the balance owing, notwithstanding that EMI failed to pay Comgen those funds. [ 59 ] Arrangements were made to ship the Generator and it was delivered to EMI’s site in Alberta on February 17, 2022 by Pentagon Freight Services Canada Ltd. [ 60 ] The cost of shipping paid by Comgen was $17, 805.90. [ 61 ] A muffler that was part of the Generator was not delivered to EMI because there wasn’t enough room on the truck to load it. The muffler remains at Comgen’s site.

Comgen has offered to deliver it to EMI upon payment of the balance owing and is still prepared to do so. The estimated cost of shipping the muffler as of February 17, 2022 was $3,100.00. [ 62 ] Between February 17, 2022 and October 1, 2022 Comgen contacted EMI eight times demanding payment of the balance owing. [ 63 ] Mr. Murray initially testified that he contacted Comgen many times in the Spring of 2022 to report the Generator’s deficiencies.

He later changed that evidence and testified that he was silent regarding those deficiencies for about 7.5 months because EMI could not connect the Generator to its facility for an extended period of time due to the Covid pandemic and due the unavailability of certain breakers at EMI’s site. [ 64 ] Comgen says that this inconsistency in Mr. Murray’s testimony reveals him to be an untruthful witness and that minimal weight should be given to his testimony. [ 65 ] I find that this Mr.

Murray’s inconsistent testimony on this material issue taints the whole of his evidence, and that he was an unreliable witness whose evidence must be viewed with scepticism by the Court. [ 66 ] As a result, where Mr. Murray’s evidence is inconsistent with Mr. Hamm’s evidence on any material issue upon which there

is no other evidence supporting Mr. Murray’s testimony, I accept Mr. Hamm’s evidence. [ 67 ] I accept Mr.

Hamm’s testimony that from February 17, 2022 to October 1, 2022 EMI did not notify Comgen of any Generator deficiencies. [ 68 ] I find that the first notice of deficiencies was given by EMI to Comgen by email dated October 1, 2022, which describes a missing control system and missing mufflers but does not describe any deficiency in the energy output of the Generator, or any of the other deficiencies alleged at paragraph 15 of the Civil Claim. (Defendant’s Documents at p. 146) [ 69 ] On August 28, 2022 Steve Murphy was hired by EMI to install a main generator controller on the Generator.

His report was entered as Exhibit 6. It states, inter alia , that upon his inspection of the Generator: (

a) it did not have a main generator controller; (

b) it was not operational without the main generator controller; (

c) it had a large coolant leak that prevented any running or testing; (

d) after the main controller generator was installed and coolant was added the Generator was operational; and (

e) he did not conduct a full load test. [ 70 ] Mr. Murphy testified that the Generator fits the description of it in the Purchase Contract. [ 71 ] I accept Mr. Murphy’s evidence as described above. [ 72 ] After the Generator was operational Mr. Murphy did not fully load test it, so he could not testify with any certainty as to its energy output capacity. [ 73 ] As there is no evidence that a full load test was conducted on the Generator after it was delivered to EMI, there is insufficient admissible evidence proving EMI’s claim that the Generator was not capable of producing 500kW of energy. [ 74 ] Mr.

Murray testified that EMI estimates the cost of replacing the exhaust system, including the muffler is $8,000.00, the cost of replacement parts for the Generator is $20, 435.55, and the costs for diagnosing the problems with the Generator total $5, 5250.00. With the exception of one invoice in the amount of $3,319.23 (Exhibit 8) no invoices or documents supporting this testimony were entered as evidence, and no other witness was called to testify to the basis for EMI’s estimate of costs or the cost of any work done to remediate or repair any alleged deficiencies. [ 75 ] Mr.

Murray also testified that because the Generator could only produce 400 kW (i.e. 80% of 500kW), EMI is entitled to a 20% reduction on the $100,000.00 purchase price (i.e. $20,00.00). Issues [ 76 ] The issues are: (

a) the

interpretation of the Purchase Contract; (

b) the “as is, no warranty” clause and the Entire Agreement Clause in relation to EMI’s claims of implied conditions under the Sale of Goods Act and innocent misrepresentation; (

c) if Comgen is found liable on the Civil Claim, the quantum of damages, if any, that EMI has proven; (

d) whether Comgen has proven EMI’s liability on the Counterclaim; and (

e) if EMI is found liable on the Counterclaim, the quantum of damages, if any, that Comgen has proven. Onus of Proof [ 77 ] EMI bears the burden of proving the claims in the Civil Claim on a balance of probabilities, and Comgen bears the burden of proving it s claims in the Counterclaim on a balance of probabilities. [ 78 ] The task of the Court is to scrutinize the relevant evidence to determine whether it is more likely than not that an alleged event occurred. The Court must determine whether the evidence is “...sufficiently clear, convincing and cogent to satisfy the balance of probabilities test...” C(

R) v McDougall , 2008 SCC 53 at para 46 . [ 79 ] The sufficiency of the evidence required to satisfy the balance of probabilities standard was considered in C(

R) at para 86 , where the Court held that where there is conflicting testimony in civil cases, provided that the Court has not ignored the evidence, finding the evidence of one party credible may well be conclusive of the result because that evidence is inconsistent with that of the other party. In such cases, believing one party will mean explicitly or implicitly that the other party was not believed on the important issue in the case. Canons of Construction [ 80 ]

Interpretation of the Purchase Contract is governed by the rules enunciated by the Alberta Court of Appeal in Encana Oil & Gas Partnership v Ardco Services Ltd , 2017 ABCA 401 , para 13 , citing Fridman, Law of Contract in Canada , 5th ed. (Toronto:

Carswell, 2006) at 454-462, as follows: i. Where there is no ambiguity in a written contract it must be given its literal meaning; ii. Words must be given their plain, ordinary meaning, at least unless to do so would result in an absurdity; iii. The contract must be construed as a whole, giving effect to everything in it, if at all possible; iv. In cases of doubt, as a last resort, language should always be construed against the grantor or promisor under the contract; verbafortius accipiuntur contra proferentum; and v.

The ejusdem generis rule [81] The task of the court is to try to give effect to the reasonable expectations of the parties by attempting to discover what theyintended: Encana, supra; Gillespie Bros & Co v Roy Bowles Transport Ltd; Rennie Hogg Ltd, Third Party, [1973] 1 QB 400; CrestonMoly Corp v Sattva Capital Corp, 2014 SCC 53. “As is, no warranty” [82] EMI submits that because “as is” is not sufficiently defined in the Purchase Contract, all representations not specificallyincluded or referenced in it, including the Sale of Goods Act implied warranty of merchantability ought to be deemed to be part of thePurchase Contract and binding, regardless of any other clauses restricting representations. [83] Comgen describes this submission as a “...unique subjective

interpretation...” of the phrase “as is” and submits that it does notoverride the definition and effect of that term in the law of contract, and cites Gafco Ennterprises Ltd. v. Shofield, 1983 ABCA 100(Comgen Written Submissions at para 3.12 and Tab 2). [84] Gafco was considered in Moldenhauer and Moldenhauer v Alberta Powersports Inc, 2009 ABPC 118.

Judge Shriar notedthat in Gafco there was written documentation that included wording to the effect that there were “no warranties of any kind”, and inGafco Justice Harradence concluded that unless there had been a substantial breach of contract, the exclusion clause (i.e. excluding theapplication of the implied terms of the Sale of Goods Act) should prevail. [85] In Moldenhauer Judge Shriar also cited Feucht v Paccar of Canada Ltd, [1985] 61 AR 382 (ABQB) and HunterEngineering Co v Syncrude Canada Ltd, [1989 ] (SCC), 57 DLR (4th) 321 (SCC). [86] In Feucht an “as is, where is” clause was upheld, and the purchaser of a vehicle was held to have waived important rights incase the vehicle was defective. [87] In Hunter Engineering an exclusion clause precluded a purchaser of defective gear boxes that were sold for use on an AlberaOil Sands project from relying on any statutory warranties, including the implied term of fitness for purpose.

Sale of Goods Act (the “Act”) [88] There are no implied warranties or conditions as to quality regarding any goods sold except as provided in the Act: s. 16(1). [89] An implied condition that the goods are reasonably fit for their purpose arises when a seller knows the purchaser’s purpose inbuying the goods, and the purchaser relies on the seller’s skill and judgment: s. 16(2). [90] An implied condition of merchantability arises when goods are purchased by description from a dealer in goods of thatdescription, unless the buyer has examined the goods: s. 16(4). [91]

Section 54 provides where any right, duty or liability would arise under a contract of sale by implication of law, it may benegatived or varied by express agreement or by the course of dealing between the parties or by usage if the usage is such as to bind bothparties to the contract.

Discussion and Analysis [92] This analysis is undertaken notwithstanding that EMI has failed to plead the Sale of Goods Act or innocent misrepresentationor fundamental breach as required by r. 13.6(3), and Comgen is entitled to have those claims dismissed on that basis alone. [93] In the present case the Purchase Contract is a two-page type written document. It is plainly written and unambiguous. [94] Both Mr. Murray and Mr. Hamm are sophisticated businessmen, The terms of the Purchase Contract were negotiated over aperiod of about ten days.

Those negotiations evolved from an initial offer to sell the Generator in a “serviced and ready” condition for$120,000.00 to an accepted offer to sell the Generator “as is, with no warranty” in consideration of the reduction of purchase price by$20.000.00. [95] Upon reviewing the history of the negotiations between EMI and Comgen, and upon construing the Purchase Contract as awhole, and giving the plain, ordinary meaning to the entire Purchase Contract including, but not limited to, the wording of the “as is, nowarranty” and the Entire Agreement clauses, I find that pursuant to

section 54 of the Act the parties intended to exclude the

section 16 ofthe Act implied conditions. Therefore I find that there was no implied condition of fitness for purpose under section 16(2) and there wasno implied condition of merchantability under section 16(4). [96] I also find that the parties intended the Purchase Contract to be the entire agreement, as expressed at clause 9:

This Agreement sets forth the entire understanding and agreement of the parties with respect to the subject matter hereof and is intended as a final and complete expression of that agreement. No other representation, warranty or covenant has been made or relied upon by either party in entering this Agreement... (emphasis added) [ 97 ] This Entire Agreement clause and

section 54 operate to defeat EMI’s claim that any implied conditions or warranties attached to the sale of the Generator, and operate to defeat EMI’s claim of innocent misrepresentation. To ignore the Entire Agreement clause would serve to deprive the parties of the certainty it was intended to deliver: Houle v Knelsen Sand and Gravel Ltd , 2016 ABCA 247 [ 98 ] Further, if Comgen made an innocent misrepresentation not captured by

section 54 and the Entire Agreement clause, that innocent misrepresentation is not actionable. The evidence shows that the Generator became operational upon the installation of a main control generator and the addition of coolant by Mr. Murray on August 28, 2022, and EMI has failed to prove that the Generator is not capable of generating 500kW, so EMI has failed to prove that an “error in substantialis”, as described in Gafco, has resulted. Loss of Business [ 99 ] EMI has failed to adduce any evidence supporting its claim for loss of business, and that claim is dismissed.

Adjudication of Liability on the Civil Claim [ 100 ] All of EMI’s claims are dismissed. Damages on the Civil Claim [ 101 ] Notwithstanding the dismissal of all of EMI’s claims, I will comment on EMI’s claim for damages. [ 102 ] As noted above, there is no evidence that EMI has suffered damages arising from loss of business. Mr. Murray testified that EMI incurred other damages totaling $37,004.78. [ 103 ] With the exception of an invoice in the amount of $3,319.23 for a radiator (Exhibit 8), this testimony was not supported by any other evidence. [ 104 ] In light of the adverse assessment of the reliability of Mr.

Murray as a witness, in the absence of other evidence there is no reasonable basis upon which to calculate EMI’s damages in any amount exceeding $3,319,23. The Counterclaim [ 105 ] Comgen has proven that EMI breached the Purchase Contract by withholding payment to Comgen of the balance of the purchase price of $30,000.00, $5,000.00 GST and $17,805.90 for freight, all due and payable on February 17, 2022 pursuant to the terms of the Purchase Contract. [ 106 ] Comgen has proven damages on the Counterclaim in the total amount of $52,805.90.

However, the monetary jurisdiction of this Court as of the date the Civil Claim was filed was limited to a maximum of $50,000.00. Comgen is therefore awarded damages on the Counterclaim in the amount of $50,000.00. [ 107 ] Comgen’s claim for interest at the rate of 24% per annum is dismissed because the Purchase Contract does not include any term relating to interest payable on overdue accounts.

The only term relating to interest payable on overdue accounts is found endorsed on invoice # 20365, and that invoice is excluded from the Purchase Contract by the Entire Agreement clause. [ 108 ] Comgen shall be entitled to interest on $50,000.00 from February 17, 2022 to the date of judgment calculated pursuant to the Judgment Interest Act of Alberta. No Setoff [ 109 ] EMI is not entitled to any setoff as EMI has not filed a claim for setoff, and EMI has failed to adduce sufficient evidence to prove it has a valid claim for setoff.

Costs [ 110 ] As the successful party Comgen is entitled to costs on the Civil Claim and the Counterclaim. In the event that the parties cannot agree on costs written submissions may be filed by February 29, 2024. Heard on the 19 th day of December, 2023 and the 21 st day of December, 2023. Dated at the City of Red Deer, Alberta this 8 th day of February, 2024.

G.A.G. Yake A Justice of the Alberta Court of Justice Appearances: Brad Murray Barry Friesen Agents for the Plaintiff/Defendant by Counterclaim David Boris Counsel for the Defendant/Plaintiff by Counterclaim