Livent Inc., Re (1999), 46 O.R. (3d) 463 (C.A.)

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  • Date: 2018

North York Performing Arts Centre Corporation v.

Ticketmaster Canada Ltd. et al.* [Indexed as: Livent Inc. (Re)]

46 O.R. (3d) 458

[1999] O.J. No. 4294

Docket No. C31936

Court of Appeal for Ontario

Catzman, Labrosse and Moldaver JJ.A.

November 15, 1999

 

 

*Vous trouverez traduction franaise de la dcision ci-dessous 46 O.R. (3d) 463.

 

Consumer protection legislation — Tickets for performance of live entertainment — Live entertainment seller selling tickets for performances that are subsequently cancelled — Refund and trust duties imposed by Consumer Protection Act not applying — Consumer Protection Act, R.S.O. 1990, c. C.31, s. 20.

Sale of goods — Consumer protection — Tickets for performance of live entertainment — Live entertainment seller selling tickets for performances that are subsequently cancelled — Refund and trust duties imposed by Consumer Protection Act not applying — Consumer Protection Act, R.S.O. 1990, c. C.31, s. 20.

Live entertainment sellers and their agents selling tickets for performances that are subsequently cancelled are not subject to the refund and trust duties imposed by s. 20 of the Consumer Protection Act. Section 20 applies, amongst other things, when money is paid on account of the “proposed purchase of goods or services,” and “proposed” modifies “purchase” not “services”. In the case of a sale of a ticket for a performance, the purchase is not a “proposed purchase” within the meaning of s. 20. The purchase takes place when the ticket is sold; it is only the “services” that are proposed, for they take place on a later occasion.

 

 

Cases referred to

 

Dwyer v. Hunter, [1951] N.Z.L.R. 177 (C.A.); Heller v.

Niagara Racing Assn. (1924), 56 O.L.R. 355, [1925] 2 D.L.R. 286

(C.A.); Hurst v. Picture Theatres Ltd., [1915] 1 K.B. 1, [1914-25] All E.R. Rep. 836, 83 L.J.K.B. 1836, 111 L.T. 972,

30 T.L.R. 642 (C.A.)

Statutes referred to

 

Companies’ Creditors Arrangement Act, R.S.C. 1985, c. C-36 Consumer Protection Act, R.S.O. 1990, c. C.31, ss. 1 “executory

contract”, 18, 19, 20

 

Rules and regulations referred to

 

Reg. 176, R.R.O. 1990 (Consumer Protection Act), s. 9

APPEAL from an order of Ground J. (1998), 42 O.R. (3d) 501,

45 B.L.R. (2d) 249 (Gen. Div.) declaring that s. 20 of the Consumer Protection Act, R.S.O. 1990, c. C.31 does not apply with respect to the sale of tickets by live entertainment sellers and their agents.

 

Christopher W. Besant, for appellant.

Daniel R. Dowdall and R. Shayne Kukulowicz, for respondent, Ticketmaster Canada Ltd.

Patrick J. O’Kelly, for respondent, Livent Inc.

Kevin P. McElcheran, for respondent, Canadian Imperial Bank of Commerce.

Sheryl E. Seigel, for respondent, Senior Noteholders.

 

The judgment of the court was delivered by

CATZMAN J.A.: —

 

The Appeal

 

[1]  North York Performing Arts Centre Corporation (“NYPACC”) appeals from the order of Ground J. [reported (1998), 42 O.R. (3d) 501, 45 B.L.R. (2d) 249] declaring, among other things, that:

. . . the refund and trust obligations arising under s.20 of the Consumer Protection Act and s.9(2) of the regulations thereto respectively are not applicable to the transactions between Livent (whether entered into directly or through TicketMaster as its agent) and persons who paid in advance (either to Livent directly or indirectly to Livent through TicketMaster) for the issuance of advance tickets (the “TicketHolders”) in respect of:

 

(i)  performances scheduled to occur at the Ford Centre which were arranged by and then subsequently cancelled by Livent; and

(ii)  events scheduled to be presented by third party renters of Ford Centre facilities (“Renters”) where the facility rental was cancelled by Livent.

 

[2]  In addition to this declaration, Ground J. made further declarations, adverse to NYPACC, with respect to alleged express or implied or constructive trusts in favour of NYPACC, the ticketholders and the renters. No appeal has been brought in respect of those further declarations.

 

The Issues on the Appeal

 

[3]  In this court, NYPACC limited its appeal to the following issues, expressed in its factum in two questions:

1.    Are live entertainment sellers and their agents subject to the refund and trust duties imposed by s.20 of the Consumer Protection Act and s.9 of the regulation

thereto?

2.    Can compliance with these provincially legislated duties be suspended or compromised by orders under the federal Companies’ Creditors Arrangements Act?

 

[4]  I have concluded that the answer to the first question is in the negative, with the result that it is unnecessary to answer the second question.

Relevant Provisions of the Consumer Protection Act and Regulation

 

[5]  Sections 18 and 20 of the Consumer Protection Act, R.S.O. 1990, c. C.31 (“the Act”), provide:

18. This Part [Part II] applies to executory contracts for the sale of goods or services where the purchase price, excluding the cost of borrowing, exceeds $50.

. . . . .

20. Where a trade-in is delivered or money is paid, whether by way of deposit or otherwise, on account of the proposed purchase of goods or services but no binding contract is entered into in respect of the goods and no delivery of the goods or any part thereof has been made to the buyer or no performance of the services has been made, the seller shall upon the request of the buyer return such trade-in or refund in full the money so paid, as the case may be.

 

[6]  Part II applies to “executory contracts”. “Executory contract” is defined in s. 1 of the Act as follows:

1. In this Act,

. . . . .

“executory contract” means a contract between a buyer and a seller for the purchase and sale of goods or services in respect of which delivery of the goods or performance of the services or payment in full of the consideration is not made at the time the contract is entered into;

 

[7]  Section 9(1) and (2) of Reg. 176, R.R.O. 1990, passed pursuant to the Consumer Protection Act, provides:

9(1) All money received by a seller under an executory contract to which Part II of the Act applies and that is subject to rescission shall be retained by the seller in trust for the buyer until the contract is rescinded under section 21 of the Act or until the period for rescission has expired, whichever is the later.

(2)  Where money is paid, whether by way of deposit or otherwise, on account of the proposed purchase of goods or services but no binding contract is entered into in respect of the goods and no delivery of the goods or any part thereof has been made to the buyer or no performance of the services has been made, the seller shall retain the money in trust for the buyer until,

(a)  the goods are delivered or the services performed;

(b)  the buyer requests the refund in full of the money paid; or

(c)  subject to subsection (1), a binding contract is entered into.

 

Ground J.’s Conclusions

 

[8]  In declaring s. 20 of the Act and s. 9(2) of the Regulation to be inapplicable to the transactions involving the ticketholders and the renters, Ground J. held that:

(i)  the contract with them did not fall within the statutory definition of “executory contract”, because there was not a contract for the purchase of services, but rather a contract in the nature of a licence to attend a theatre and to occupy a particular seat for a particular performance; and

(ii) the contract with them was not a contract for “the proposed purchase . . . of services” because the purchase was complete at the time the ticket was obtained, at which time the ticketholder acquired an enforceable right to attend a future performance or, failing performance, to claim rescission of the contract and repayment of the ticket price.

 

“Executory contract”

 

[9]  The first of Ground J.’s two conclusions rested on the authority of such “ticket cases” as Hurst v. Picture Theatres Ltd., [1915] 1 K.B. 1, [1914-15] All E.R. Rep. 836 (C.A.) and Heller v. Niagara Racing Assn. (1924), 56 O.L.R. 355, [1925] 2 D.L.R. 286 (C.A.). These cases address the sale of a ticket from the perspective of a licence, irrevocable unless the ticketholder behaves improperly or fails to comply with known conditions, to enter on and remain in premises for the period of the event or performance. NYPACC urged us to accept, as an analysis more in keeping with modern realities, that described in Dwyer v. Hunter, [1951] N.Z.L.R. 177 (C.A.). That case, in assessing the relationship of hotel-keeper and guest, held (at p. 190) that, while the hotel confers upon the guest a licence to occupy a bedroom or a dining room or a sitting room, the licence nonetheless also involves the rendering of services. That conclusion is not far different from Ground J.’s assessment of a ticketholder’s entitlement in the present case, which he described in these terms:

It seems to me that the nature of the contract [between the ticketholder and Livent] is a contract whereby the ticketholder acquires the right to attend a theatre and to occupy a particular seat for a particular performance to watch and hear the performance where the services of the performers are provided but that such services are provided to the producer not to the ticketholder.

 

(Emphasis added)

 

[10]  NYPACC argued that the contract between Livent and its ticketholders falls within the statutory definition of “executory contract”. It was, NYPACC submitted, “a contract between a buyer and a seller for the purchase and sale of . . . services in respect of which . . . performance of the services

. . . is not made at the time the contract is entered into”.

 

[11]  While those words, read literally, might admit of such an interpretation, I have no doubt that the type of transaction in the present case is one which the legislature could not reasonably have intended to fall within the contemplation of “executory contract”. This is evident from a brief reference to s. 19 of the Act, which sets out the statutorily prescribed form of an executory contract. Section 19(1)(a) requires every executory contract to contain “the name and address of the seller and the buyer”; s. 19(1)(c), “the itemized price of the goods or services and a detailed statement of the terms of payment”; s. 19(1)(f), “any warranty or guarantee applying to the goods or services and, where there is no warranty or guarantee, a statement to this effect”. In the same vein, s. 19(2) provides that an executory contract is not binding on the buyer unless the contract is made in accordance with Part II of the Act and regulations and is signed by the parties and a duplicate original copy is in the possession of each of the parties. These are provisions that cannot realistically apply to the purchase, typically by telephone, of a ticket for a theatrical performance or to the form of ticket generated by such a purchase. Although I need not form any concluded opinion on the subject, I suggest that legislative attention to the definition of “executory contract” might usefully put beyond argument the suggestion that such ticket sales are caught by that expression.

 

“Proposed purchase of goods or services”

 

[12]  The reason I need not form any concluded opinion on the subject of “executory contract” is that, in my view, NYPACC’s argument clearly founders on Ground J.’s second conclusion: that the contract is not one for “the proposed purchase of goods or services” within the wording of s. 20 of the Act and s. 9(2) of the Regulation.

 

[13]  On this subject, Ground J. said in his reasons [at pp. 507-08]:

Accordingly, even if the contract between Livent and the ticketholder is interpreted to be a contract for the purchase of services, it is not in my view a proposed purchase in that the purchase is completed at the time the ticket is obtained because at that time the ticketholder has purchased or acquired an enforceable right to attend a future performance or failing performance, to claim rescission of the contract and repayment of the ticket price.

 

[14]  I agree. Omitting reference to “goods”, the relevant statutory expression is “proposed purchase of services”, not “purchase of proposed services”. “Proposed” modifies “purchase”, not “services”. The contract is made when the ticket is purchased and, even if the subsequent presentation of the performance falls within the term “services”, they are services to be performed at some later date. The “purchase” takes place when the ticket is sold; even on NYPACC’s analysis, it is only the “services” that are proposed, for they take place on a later occasion.

 

[15]  This is, in my view, the proper interpretation of the expression “proposed purchase of . . . services” in s. 20 of the Act and s. 9(2) of the Regulation, and it is fatal to NYPACC’s position on this appeal.

 

[16]  In the result, the answer to NYPACC’s first question is in the negative, and it becomes unnecessary to deal with the second question.

 

Disposition

 

[17]  The appeal is dismissed with costs.

 

Appeal dismissed.