Gubbins, a farmer, wanted to develop some land he owned in
Cornwall. He engaged John Grimes Partnership (JGP) to design the
road and drainage works that the local government required for the
project. Gubbins and JGP agreed that the work would be completed by
March 2007, but even by February 2008 some parts of the work had
not been completed. Gubbins hired a new engineer in May 2008 who
redesigned the road and drainage layout and got council approval a
month later. JGP sued for outstanding fees; Gubbins counterclaimed
for the reduction in the value of the rental units he had built on
the land, as a result of a falling real estate market.
The trial judge found that JGP was responsible for the delay and
had caused loss attributable to a decline in the market value
property. The real issue was whether that loss was too remote for
recovery. The trial judge concluded that it was not: 'while
property markets rise and fall, they tend not to do so overnight
but over a prolonged period' – and it was the
'egregious delay' of JGP (which would have known the
potential effects of delay on property values) which caused this
loss. On appeal, JGP argued that losses flowing from market
fluctuations beyond its control were too remote for recovery and
not reasonably foreseeable at the time of contracting. Sir David
Keene, who gave the leading judgment in the Court of Appeal, held
that it is necessary to decide whether a loss is of the kind or
type for which the contract-breaker can fairly be said to have
taken responsibility, in light of the particular market in which
the parties are operating. While there are very few decided cases
where a decline in the property market during a period of delay has
given rise to an actionable loss, JGP would have known that market
fluctuations were likely, known what Gubbins wanted to do with the
land and appreciated the potential consequences of a long delay in
performance. Appeal dismissed: John Grimes Partnership Ltd v
Gubbins,  EWCA Civ 37.
Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
While most are well aware that the sale of a business is generally a complex process, even sophisticated business owners are surprised by just how much cost and effort is required to complete the sale.
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