The Supreme Court of Canada this week released two judgments of
interest to Canadian businesses and professions, the first dealing
with the scope of the "unlawful means" required to
ground the tort of interference with economic relations and the
second addressing the permissable use of a pension surplus.
Enterprises Ltd. v. Bram Enterprises Ltd., 2014 SCC 12, the
Supreme Court brought some clarity to the so-called "unlawful
means" tort, affirming a narrow definition of "unlawful
means". There has been an ongoing debate in Canada as to
whether "unlawful means" encompassed any act
without legal justification or only independently actionable
In this case, a syndication of family members elected to sell an
apartment building. The proposed sale triggered a right of first
refusal at an appraised value for a dissenting family member. The
dissenting family member declined, but then took steps to prevent
the sale of the building to a third party. The dissenting family
member ultimately purchased the building, but the delay in sale
meant the appraised value was substantially less than could be
obtained from a third party. The family argued the dissenting
member breached his obligations and acted unlawfully, and committed
an economic interference that caused losses.
The trial judge found the economic tort of interfering with
contractual relations by unlawful means had been established and
awarded damages. The Court of Appeal dismissed the appeal and
adopted the narrow definition of the "unlawful means"
element. The Supreme Court dismissed the further appeal.
The main issue before the Supreme Court was what the
"unlawful" component of the tort meant, a phrase which
has caused confusion in Canadian law. In Ontario, for
example, 2010 saw the Court of Appeal issue two contradictory
decisions: in Valcom, the Court adopted the narrow definition
of "unlawful means," restricting it to actionable wrongs;
however, the Court of Appeal adopted the broad definition (adopted
in the earlier case of Reach M.D. Inc. v. Pharmaceutical Manufacturers
Assn. of Canada) where the "unlawful means"
requirement was held to encompass any act that "the defendant
is not at liberty to commit – in other words, an act without
legal justification." For a further discussion of the Court of
Appeal decisions, see the post from my colleagues
The Supreme Court adopted a narrow view of "unlawful
means", holding that the test required an independent
actionable wrong. In so doing, the Court cautioned that to hold
otherwise would risk "tortifying" the criminal
and regulatory law by imposing civil liability where there would
not otherwise be any.
In this case, members of a Manitoba provincial pension plan had
assets and pension rights transferred to new pension plan as a
result of the privatization of the employer. The original pension
fund had an actuarial surplus of 43 million dollars, the sole
result of employee contributions to old plan (a situation not
typical of most defined benefit plans). The employer sought to use
the surplus to take a contribution holiday.
At issue was whether the two plans
were "equivalent in value" because the surplus,
which had been accessible to the plan members under the old plan to
fund enhancements, was not accessible to them under the new
plan. The Court of Appeal concluded that the legislation
only required equivalency of the basic superannuation allowance
received by plan members under the two plans.
The Supreme Court allowed the appeal, concluding that the
inclusion of the word "value" in "equivalent in
value" in the governing legislation suggested that the phrase
should be interpreted as capturing both the benefits paid to the
plan members and the funding mechanism used to produce those
The governing legislation and the unique features of the old
plan distinguish this case from previous decisions of this Court
involving entitlement to the actuarial surplus in a defined benefit
In Irwin v. Alberta Veterinary Medical Association, 2015 ABCA 396, the Alberta Court of Appeal found that the "ABVMA" failed to afford procedural fairness to a veterinarian undergoing an incapacity assessment.
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