7.3: Summary Judgment (Application and decision)

Case Summary

The Plaintiff applied for Summary Judgment. The Plaintiff and Defendant entered into contracts for, inter alia, the provision of plastic resins from the Defendant to the Plaintiff. An explosion occurred in the Defendant’s facilities and the Defendant was not able to supply the Plaintiff with the product. The Plaintiff purchased the product from other suppliers and sought damages for the difference between what it had to pay the other suppliers, and what it would have paid to the Defendant pursuant to the contract. The Plaintiff also sought damages for its equipment that was damaged as a result of the explosion interrupting the electrical supply.

The Defendant argued, inter alia, that the force majeure clauses in the contracts were applicable. The Defendant argued that the explosion happened from peroxide warming and exploding from a liquid state, and the Defendant was not aware that an explosion from the liquid state could occur. The Defendant was only aware that an explosion could occur from peroxide warming into a vapour state. Thus, as the Defendant was not aware that this type of explosion could occur it could not guard against it, and the force majeure clause was applicable.

Between the date of the hearing and the date of the Judgment, the Alberta Court of Appeal issued the decision in Windsor v CPR, 2014 ABCA 108 (“Windsor”). The Court held that Windsor amended the Summary Judgment test in Alberta.

The Court found that there was uncertainty as to whether the explosion constituted a force majeure or not, and that the evidence presented revealed a genuine issue of fact which required resolution by Trial. The Application was dismissed and Costs were awarded to the Defendant.

View CanLII Details