Executive Summary: Key Legal and Evidentiary Issues

• Miss Browns was found to have standing despite a clerical error naming a numbered company in the lease.

• Bedford breached the lease by failing to repair structural issues that rendered the premises unsafe.

• Landlord's negligence and willful misconduct were proven, particularly regarding ignored city orders and withheld safety warnings.

• Lease terms on structural maintenance, quiet enjoyment, and notice obligations were violated.

• Damages awarded were based on accepted expert testimony estimating $390,000 in business loss.

• Punitive damages of $100,000 were imposed due to Bedford’s egregious and dangerous conduct.

Background of the parties and lease relationship

Miss Browns Hot Pressed Sandwich and Coffee Corp. ("Miss Browns") operated a restaurant at 288 William Avenue, Winnipeg, under a commercial lease with Bedford Investments, comprising 5500967 Manitoba Ltd. and 5780862 Manitoba Ltd. Although the lease listed the tenant as "6970118 Manitoba Ltd.," the court found this was a harmless error. The lease and all communications reflected Miss Browns as the true party in interest. Miss Browns operated the restaurant from 2015 until January 22, 2021, when the City of Winnipeg ordered the premises vacated due to unsafe conditions.

The structural deficiencies were linked to the neighbouring building at 284 William Avenue, also owned by Bedford, which shared a foundational wall with 288 William. That property had remained vacant and deteriorating since 2007. Despite repeated city orders requiring repairs, Bedford failed to remediate dangerous conditions that compromised both buildings.

Policy terms and lease clauses at issue

The lease contained critical provisions governing the responsibilities of the landlord:

• Section 8.02 limited the landlord’s liability unless damages were due to negligence or misconduct.

• Section 10.04 required the landlord to maintain and repair all core systems, including structural, HVAC, plumbing, and mechanical.

• Section 11.01 allowed lease termination for unrepairable damage but required notice, which Bedford never issued.

• Section 16.17 guaranteed the tenant’s right to quiet enjoyment of the premises.

In the 2020 lease renewal, Schedule A was added to explicitly require structural repairs and a repair timeline within 30 business days—none of which were fulfilled.

Negligence and willful misconduct

The court found Bedford liable for both negligence and willful misconduct. The evidence showed Bedford ignored multiple city compliance orders, failed to address engineer warnings, and deliberately withheld critical safety information from Miss Browns. The most damning incident was a December 21, 2020 letter from Keystone Projects warning of potential structural collapse under snow load, which Bedford did not disclose to the tenant. Instead, Bedford prioritized selling the property without remediation.

The court concluded Bedford’s conduct was beyond negligent—it was calculated, dangerous, and driven by profit at the expense of safety.

Assessment of damages

Miss Browns sought damages for the lost business value until the lease's expiry in 2030. Competing experts testified. The court accepted the evidence of the plaintiff’s expert, Rob Rabichuk, over the defense expert, citing credibility concerns and inappropriate assumptions in the latter’s report.

General damages were awarded at $390,000 after adjusting for advertising costs. An additional $2,040 was awarded for the withheld security deposit.

The court found that Miss Browns had taken reasonable steps to mitigate losses by seeking new premises and retaining experts to assess relocation feasibility. The defense offered no credible rebuttal on mitigation.

Punitive damages

The court found the case met the high threshold for punitive damages due to Bedford’s egregious, repeated, and dangerous misconduct. It highlighted:

• Ignoring multiple city orders over a span of years

• Failing to disclose structural risks to the tenant

• Placing public safety at risk for financial gain

Citing proportionality and the need for deterrence, the court awarded $100,000 in punitive damages, rejecting the plaintiff’s request for $50,000 as insufficient.

Conclusion and judgment

The court ruled that Bedford’s breach of the commercial lease directly led to the closure of Miss Browns and awarded:

• $390,000 in general damages

• $2,040 in special damages

• $100,000 in punitive damages

The plaintiff was also awarded interest and costs. The judgment sends a strong warning to commercial landlords about the legal and financial consequences of neglecting structural repairs and endangering tenants.