Written by Nick Noonan, JD, LLM
This case is a COVID-19 related dimension of Manitoba business law. In Aleshka v. Fettes et al., 2021 MBQB 14, there was a complex legal dispute involving an alleged settlement agreement between several parties, Carmyn Aleshka and Greg Fettes. The case’s intricate details, coupled with the backdrop of the COVID-19 pandemic, provide a rich context for understanding the nuances of business law in Manitoba.
The dispute began with an alleged agreement reached on February 5, 2020, which was referred to as a “deal” in email correspondence. The parties involved were negotiating the transfer of Carmyn’s and Greg’s respective ownership interests. The complexity of the transaction required legal and tax advice, and the negotiation of commercial documentation. However, the evidence presented in the case was not sufficient to discern the essential terms of the alleged settlement agreement. The term “deal” was not clearly defined, and there was no written communication or note that clearly set out the terms of the alleged settlement agreement. Conflicting evidence from the parties’ legal representatives on corporate issues further complicated the situation. The evidence presented by Snyder suggested that the understanding reached on February 5, 2020, was predicated on the parties obtaining legal and tax advice and negotiating the commercial documentation. This point related to essential term, the certainty of terms, and the intention to contract.
The court dismissed Carmyn’s motion to enforce the settlement agreement, ruling that she had not established the existence of an enforceable settlement agreement. Notwithstanding the “we have a deal e-mail”, there was no written communication in evidence dated on or near February 5, 2020, clearly setting out the terms of the alleged settlement agreement.
The post-“we have a deal email” correspondence did not clarify the situation. The parties were clearly still negotiating long after the e-mail. Thus, the settlement agreement was not a complete contract.
The case underscores the critical importance of clear and unambiguous terms in contractual agreements. The lack of clarity around the term “deal” and the absence of a written agreement with well-defined terms led to a legal dispute that could have been avoided with more precise drafting. This emphasizes the need for legal practitioners to be meticulous in crafting agreements, ensuring that all essential terms are explicitly defined and agreed upon.
Although the court did not make a specific finding related to the pandemic’s effect on the transaction, during argument, both sides made submissions about Greg’s reliance on the pandemic as a reason to not close the deal. As such, the case provides insight into the broader challenges faced by commercial transactions during this unprecedented time. The pandemic introduced new uncertainties into the commercial real estate market, affecting property valuations and financing arrangements. This case illustrates how these uncertainties can complicate legal agreements and lead to disputes. It also highlights the need for flexibility and adaptability in legal agreements to account for unforeseen circumstances such as a global pandemic.
The views and opinions expressed in the blogs and case reporter are the views of their authors, and do not represent the views of the Desautels Centre for Private Enterprise and the Law, the Faculty of Law, or the University of Manitoba. Academic Members of the University of Manitoba are entitled to academic freedom in the context of a respectful working and learning environment.