This was an Appeal Decision from cross-Applications for Summary Judgment by an Applications Judge. 

The Plaintiffs and the Defendants engaged in a multi-step and multi-party transaction to incorporate a company for acquiring three energy services companies. Following the transaction, both parties became shareholders in that company, with the Plaintiffs holding some of their shares through a limited partnership (“the Canadian LP”) governed by a limited partnership agreement (“the Canadian LPA”).

The Plaintiffs applied for a Summary Judgment, claiming that the Canadian LPA had terminated as per its terms, requiring the dissolution of the Canadian LP and the return of the Plaintiffs’ shares. The Defendants disagreed, arguing that the Canadian LPA had been renewed and extended and that the return of the Plaintiffs’ shares was prohibited until the company experienced a liquidity event, which had not occurred and was not imminent.

The Applications Judge agreed with the Plaintiffs, determining that the Canadian LPA had terminated and granting them Summary Judgment in that regard (the “Extension Issue”). However, the Applications Judge disagreed that the termination of the Canadian LPA automatically mandated the return of the Plaintiffs’ shares, directing instead that this matter proceed to Trial (the “Remedy Issue”). Both parties appealed: the Defendants against the Summary Judgment on the Extension Issue and the Plaintiffs against the denial of Summary Judgment on the Remedy Issue.

The Court noted that this was not a hearing de novo; instead, the Court must decide whether the Applications Judge’s Decision was correct on the record that was before him. The Court considered Rule 7.3(1) and the relevant Summary Judgment case law and stated that Summary Judgment is available: (1) where the record allows the Court to make the necessary findings of fact and apply the law to the facts; and (2) where Summary Judgment is a proportionate, more expeditious and less expensive means to achieve a just result. The Court noted that contested findings of fact were permitted on a Summary Judgment motion, unless those facts, proven on a balance of probabilities, raised a genuine issue requiring Trial.

The Court concluded that a Summary Judgment was fair and just for the issues on Appeal, which revolved around the contractual interpretation of the Canadian LPA in the context of the transaction and other related agreements between the parties. The facts were not disputed and were well canvassed in the parties’ Affidavits and cross-examination transcripts. The Court found that it was unnecessary to hear viva voce evidence at Trial regarding the parties' intentions for the transaction.

Based on the foregoing, the Court affirmed the Decision of the Applications Judge on the Extension Issue and granted the Plaintiffs’ Appeal on the Remedy Issue.