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Hav-A-Kar Leasing: Accelerated Payments in Canada ' Close But Not Quite Right
The objective of awarding damages for a breach of contract is to put the injured party in the same position as if the contract had been properly performed. This principle is commonly included in contracts through termination provisions that allow the injured party to recover future payments upon an event of default. Where all remaining payments automatically become due, the agreement typically includes a mechanism to discounted payments to take into account the time value of money. These acceleration clauses, if properly drafted, can be considered a genuine pre-estimate of damages as the lessor is in the same position it would have been in had the contract been completed. The key to a fair acceleration clause is to allow for proper discounting as to reflect the value of receiving the remaining payments before they would otherwise become due. If the lessor were to collect full payments at the time of default, the lessor would be in a better position than had the default not occurred.
The use of acceleration clauses has been accepted by Canadian courts; however, there is at least one case where the courts allowed for an accelerated payment clause to be enforced without discounting payments. An Ontario Court of Appeal case, Hav-A-Kar Leasing Ltd. v. Vekselshtein, 2012 ONCA 826 (“Hav-A-Kar“), enforced such a clause and did not discount payments for early receipt. As discussed below, the decision to enforce this type of clause is problematic as it gives the lessor more funds than it would have received had the agreement been fulfilled.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
Judge Rules Shaquille O'Neal Will Face Securities Lawsuit for Promotion, Sale of NFTs
A federal district court in Miami, FL, has ruled that former National Basketball Association star Shaquille O'Neal will have to face a lawsuit over his promotion of unregistered securities in the form of cryptocurrency tokens and that he was a "seller" of these unregistered securities.
Blockchain Domains: New Developments for Brand Owners
Blockchain domain names offer decentralized alternatives to traditional DNS-based domain names, promising enhanced security, privacy and censorship resistance. However, these benefits come with significant challenges, particularly for brand owners seeking to protect their trademarks in these new digital spaces.
Why So Many Great Lawyers Stink at Business Development and What Law Firms Are Doing About It
Why is it that those who are best skilled at advocating for others are ill-equipped at advocating for their own skills and what to do about it?
Coverage Issues Stemming from Dry Cleaner Contamination Suits
In recent years, there has been a growing number of dry cleaners claiming to be "organic," "green," or "eco-friendly." While that may be true with respect to some, many dry cleaners continue to use a cleaning method involving the use of a solvent called perchloroethylene, commonly known as perc. And, there seems to be an increasing number of lawsuits stemming from environmental problems associated with historic dry cleaning operations utilizing this chemical.