Executive Summary: Key Legal and Evidentiary Issues

• The dispute arises from a Royalty Agreement under which JH Drilling Inc. (JHD) purported to assign its Surface Material Lease #070028 (the Seal Lake Lease) to Barsi Enterprises Ltd. (Barsi), with contested obligations regarding payment, reclamation, reporting, and assignment.

• JHD’s summary judgment application was dismissed because the court found the Royalty Agreement’s payment, reclamation, reporting, and assignment provisions to be ambiguous or uncertain on the existing record, and because Barsi raised triable issues on each alleged breach.

• The court held that JHD had not proven that Barsi was obliged to pay royalties on all excavated material, had not shown that the pit was not “exhausted,” and had not established a clear contractual standard for reclamation or a contractual basis for “liquidated damages” for reporting.

• The court rejected JHD’s attempt to compel assignment and strike Barsi’s “no assignment” defence, noting that JHD never obtained the Director’s written consent required under the Public Lands Act to assign the Seal Lake Lease, and that any deficiency in Barsi’s counterclaim was properly addressed by amendment, not striking or summary dismissal.

• In the costs decision, the court held that Column 5 of Schedule C applied because JHD’s Statement of Claim exceeded $4 million, and awarded Barsi enhanced costs of $13,500 (double Column 5) for the unsuccessful summary judgment application, having regard to the complexity and inefficiency of JHD’s materials and approach.

• In a later decision, the court found that email exchanges between the parties created a binding settlement agreement for sale of the gravel pile with net proceeds split 50/50, full mutual releases, and discontinuance of the main claim and counterclaim without costs, and granted the Defendants’ application for summary dismissal of JHD’s action on that basis.

Background and facts of the dispute

JH Drilling Inc. (JHD) is a gravel prospecting company whose sole director and shareholder is John Harms. JHD is the registered holder of Surface Material Lease #070028, issued by Alberta Environment and Parks under the Public Lands Act, RSA 2000, c. P-40 (the Seal Lake Lease). The land relating to the Seal Lake Lease is located near Slave Lake, Alberta, and under the Lease JHD is entitled to excavate sand and gravel from the land.

In approximately January 2014, JHD and Barsi signed an “Assignment of SML #070028 and Royalty Agreement” (the Royalty Agreement). Under the Royalty Agreement, JHD purported to assign its rights under the Seal Lake Lease to Barsi. Barsi was entitled to excavate “aggregate or surface material” and sell it, in exchange for royalty payments to be paid by Barsi to JHD in accordance with the Royalty Agreement.

Between June and August 2014, Barsi excavated around 120,000 tonnes of material from the Seal Lake Lease, which yielded 20,000 tonnes of usable gravel. Barsi says it removed 4,000 tonnes of usable gravel from the site and that the remainder was left on or around the Seal Lake Lease. Barsi then concluded that the Seal Lake Lease was “exhausted” of usable gravel and considered the Royalty Agreement to be at an end pursuant to its terms.

JHD disagrees that the Seal Lake Lease was exhausted or that Barsi was entitled to consider the Royalty Agreement at an end. JHD alleges that Barsi has never paid the amounts it owed under the Royalty Agreement. JHD issued a Statement of Claim in September 2015, alleging that Barsi breached the Royalty Agreement and owed damages to JHD. Barsi and Don Goulet issued a counterclaim against JHD alleging, among other things, misrepresentation.

The action was later directed to case management, and Justice L.K. Harris acted as the case management justice.

The Royalty Agreement and provisions at issue

The Royalty Agreement provides that Barsi will pay JHD $4.00 for each metric tonne “for all aggregate or surface material taken from the SML” on the basis that payment for material “carried away from the lands by or on behalf of assignee, is due and payable thirty days after the last day of the month in which it is taken.” It further provides that Barsi will “purchase a minimum of 30,000 metric tonnes per annum or provide the assignor the sum of $120,000 as prepayment for aggregate to be taken,” payable “no later than December 31st of each calendar year, until the aggregate reserve, excluding sand, is exhausted.” It also states that $20,000 is payable to JHD in advance each year until “the pit is exhausted and reclaimed,” and that this $20,000 will reduce the $120,000 minimum payable for that year.

The Royalty Agreement requires Barsi to “keep proper books of account” and to permit JHD to inspect them, and it references “good comprehensive reporting with scale tickets, delivery tickets, invoices, weekly reports,” along with daily digital crushing reports and sales projections, and also requires “100% reporting and access, including crushing records, weekly summaries, trucker tickets, and sales summaries.”

The Royalty Agreement states that upon execution, JHD “will assign all of its rights to the SML to the assignee,” and that assignment documentation will be held in trust by Barsi’s lawyer. An indemnity clause requires Barsi to indemnify JHD for “any damages or loss suffered by JHD or caused by a breach of this agreement.”

In the later settlement decision, the court noted that the Plaintiff’s view was that “lease responsibilities” included possible liability to pay royalties to the Crown, and that this issue was important to the Plaintiff.

JHD’s summary judgment and strike/dismissal application (2025 ABKB 288 – JHD #1)

JHD brought an application for summary judgment and for an order either striking or summarily dismissing the Counterclaim under Rule 7.3 of the Alberta Rules of Court. The court described JHD’s application as setting out 11 different issues to be determined, some of which were duplicative or not clearly articulated. The Statement of Claim was 27 pages and contained extensive repetition of emails, the entirety of the Royalty Agreement, letters, invoices and spreadsheets. The court noted that Rule 13.6(1)(a) requires pleadings to be succinct and Rule 13.6(2)(a) requires pleadings to state facts, not evidence.

The materials filed by JHD in support of the summary judgment application were described as “extremely voluminous,” consisting of likely hundreds, if not thousands, of pages of affidavits, documents, transcripts, pleadings, and written submissions. The court noted that the size and complexity of the materials alone raised concern that the matter was not amenable to summary disposition. The court also noted that each party raised objections to the other’s affidavit evidence, including arguments about credibility and reliability.

The court set out the test for summary judgment under Rule 7.3(1), including the requirement that the moving party prove on a balance of probabilities that there is no merit to the other side’s claim or defence and that there is no genuine issue requiring a trial, and noted that the non-moving party must then demonstrate that there cannot be a fair disposition on a summary basis. The court referred to Canada (Attorney General) v Lameman, Hryniak v Mauldin, Weir-Jones Technical Services Incorporated v Purolator Courier Ltd., Maxwell v Wal-Mart, and PricewaterhouseCoopers Inc v Perpetual Energy Inc.

The court also set out the modern approach to contractual interpretation from Sattva Capital Corp. v Creston Moly Corp., emphasizing a practical, common-sense approach that looks at the contract as a whole, gives words their ordinary and grammatical meaning, and considers surrounding circumstances, as long as the parol evidence rule is respected. The court referred to IFP Technologies (Canada) Inc. v EnCana Midstream and Marketing, Columbos v QuinnCorp Holdings Inc, and Herron v Hunting Chase Inc on surrounding circumstances and the presumption that the written terms express the parties’ intentions.

Against that framework, the court considered each of JHD’s alleged breaches and noted that JHD had not established grounds for summary judgment on any of them because there were triable issues or insufficient reliable evidence to support JHD’s interpretation of the Royalty Agreement.

Payment obligations and the meaning of key terms

JHD alleged that Barsi was in default of its payment obligations under the Royalty Agreement and claimed that Barsi owed $120,000 per year from January 2014 to the present, on the basis that the Seal Lake Lease was not exhausted. JHD argued that payment was owed on the full 120,000 metric tonnes of “aggregate or surface material” that had been excavated, including material deposited just over the property line onto a site leased by Husky. JHD relied on a document titled “Summary of August 13, 2007 Field Visit” (the Carson Report) and on an expert report from Jim Greenhaigh filed in November 2022, who opined that the Seal Lake Lease was not exhausted of gravel.

Barsi’s position was that after excavating 120,000 tonnes of material, it found only about 20,000 tonnes of usable gravel, and only 4,000 tonnes of this were removed and sold. Barsi stated that it paid JHD for those 4,000 tonnes and that the remaining 16,000 tonnes were left on or near the gravel pit. Barsi asserted that the site was exhausted, relying on evidence that in the gravel industry “exhausted” means economically exhausted, not necessarily that every bit of gravel has been removed. Barsi argued that the Royalty Agreement required payment only for usable gravel (aggregate) and not for waste material or sand, and that the Royalty Agreement, when read as a whole, showed that payment obligations were tied to usable gravel removed and sold.

The court found that the payment provisions of the Royalty Agreement were ambiguous. It noted that the contract did not define “aggregate” or “surface material,” did not explicitly state that waste material was subject to payment, referred to both “aggregate” and “surface material” while appearing to exclude sand, and did not clearly define “exhausted” or state whether the minimum payment obligation ended when the pit was exhausted.

Because of this ambiguity, the court held that Sattva required consideration of evidence of the parties’ intentions at the time of the contract. The court found that JHD had not provided such evidence. Affidavits purporting to describe circumstances around the negotiations were not sworn by individuals directly involved in those negotiations, and to the extent they spoke to parties’ intentions, they appeared to be hearsay. The court emphasized Rule 13.18(3), which requires personal knowledge for final applications, and noted that Mr. Harms had not provided evidence about JHD’s intentions under the Royalty Agreement.

The court accepted that Barsi had raised triable issues by providing some evidence of how “exhausted” is used in the industry and of what material was actually removed and sold. The court concluded that the onus was on JHD to show that the Royalty Agreement obliged Barsi to compensate JHD for all materials excavated, not just usable gravel, and that JHD had not done so on the evidence before the court.

The court also found that the Carson Report was not reliable evidence for the condition of the pit in 2014. It observed that the report was prepared at least seven years before Barsi’s involvement, was unsigned, did not clearly identify the author, and did not provide evidence of the author’s qualifications. The court similarly found that Mr. Greenhaigh’s report carried little weight because he never attended the Seal Lake Lease and relied heavily on the Carson Report, and because he did not address Barsi’s point that “exhausted” refers to economic feasibility, not the complete absence of gravel.

The court rejected JHD’s submission that any material deposited over the property line onto the Husky lease must be deemed to have been “taken from the SML” for payment purposes. The court noted that this might have been due to a misunderstanding of the property line and that there was no evidence that JHD was unable to retrieve that material or that it was otherwise unavailable to JHD.

The court concluded that JHD had not established on a balance of probabilities that the payment provisions should be interpreted in the manner it argued. Having found ambiguity and that the only reliable evidence of surrounding circumstances favoured Barsi’s interpretation, the court held that JHD’s motion for summary judgment on payment obligations had to fail.

Reclamation obligations

JHD alleged that Barsi had not reclaimed the site to JHD’s satisfaction and argued that Barsi’s payment obligations under the Royalty Agreement could not conclude until reclamation was complete. Paragraph 7 of the Royalty Agreement stated that $20,000 is payable to JHD in advance each year until the pit is “exhausted and reclaimed,” but the agreement did not define “reclamation” or set a standard for what constituted complete reclamation.

JHD argued that reclamation required burning brush, reseeding to natural vegetation, and obtaining confirmation from the Provincial Government that the site had been reclaimed. These elements, however, were not contained in the text of the Royalty Agreement. Barsi said that it had reclaimed the site, though the details in the record were limited.

The court referred to Ko v Hillview Homes Ltd. on uncertainty of contract terms, noting that uncertain material terms can render a provision incapable of performance or enforcement. It stated that the onus was on JHD to show that “reclamation” in paragraph 7 required burning brush, reseeding and government approval, and that JHD had provided no evidence to support that conclusion. The court stated that it queried whether the reclamation provision might be void for uncertainty. The court held that JHD had not proven this allegation, and this ground for summary judgment could not succeed.

Record-keeping and reporting obligations

JHD alleged that Barsi breached the record-keeping and reporting obligations and claimed $240,000 in “liquidated damages” for failure to report. The parties agreed that Barsi sent a letter dated March 10, 2015 advising that 4,000 metric tonnes of gravel had been hauled to December 31, 2014. JHD argued that it received no other reporting, and sought damages on that basis.

The court examined paragraph 3(a), paragraph 12, and paragraph 21 of the Royalty Agreement, which together required Barsi to keep books of account and referenced “good comprehensive reporting” and “required reporting” including detailed records. The court noted that the agreement did not specify how such reporting was to be delivered, did not provide a delivery schedule, and did not set expectations as to format. The court stated that arguably the agreement only required Barsi to keep reporting available should JHD request to inspect it, and that there was no evidence that JHD had requested inspection or found the reporting deficient upon inspection.

Again referring to Ko, the court stated that it queried whether the record-keeping and reporting obligations might be void for uncertainty. It found no evidence from JHD that would support interpreting those provisions in a way that led to a finding of breach.

The court also concluded that even if there were a breach, the Royalty Agreement did not provide for liquidated damages for reporting failures, and JHD had not pointed to evidence that it had suffered any damages as a result, or established the quantum of any such damages. The claim for summary judgment on this ground also failed.

Assignment of the lease and the no-assignment defence

JHD sought “striking of the NAD (No Assignment Defence)” and “assignment of the lease as set out in the Contract.” Paragraph 1 of the Royalty Agreement provided that upon execution, JHD would assign all of its rights to the SML to the assignee, and paragraph 19 provided that the assignment documentation would be held in trust by Barsi’s lawyer. JHD argued that it had taken all necessary steps to assign its rights and that it was prevented from delivering the assignment documentation only because Barsi did not advise who its lawyer was.

Barsi produced a decision of the Alberta Public Lands Appeal Board, in which JHD was issued an administrative penalty for contravening the Public Lands Act because of the unauthorized assignment of rights under the Seal Lake Lease to Barsi pursuant to the Royalty Agreement. The court noted that section 43(1) of the Public Lands Act required JHD to obtain written consent of the Director before assigning any rights under a Surface Material Lease, and section 54.01(5) prohibited JHD from receiving money to allow access to public lands without authorization.

The court observed that the Appeal Board decision showed that JHD did not, and never had, the necessary approval from the Director to assign its rights to the Seal Lake Lease to Barsi. The court therefore held that Barsi’s failure to advise the name of its lawyer for delivery of assignment documentation was a moot point, and that the evidence showed JHD had likely been unable to comply with its obligation to assign its rights from the outset.

The court also noted that JHD and Mr. Harms had always known how and where to deliver documents to Barsi, as the Royalty Agreement contained Barsi’s mailing address and Barsi had been represented by counsel of record since at least October 2015. The court found JHD’s argument that it was awaiting advice as to Barsi’s lawyer’s identity to be “nonsensical.” This ground for summary judgment was dismissed.

Claims for rent and indemnification

JHD sought summary judgment on a claim for “payment of overdue rent of $5,061.01” or sale of the gravel to pay rent, described in submissions as “ten years of rent” for “preservation of property so that the Seal Lease is not suddenly cancelled” and “selling the 16,000 metric tonnes of processed gravel” to pay that rent bill. The court found that JHD had not provided any other clear explanation for why it was entitled to this relief and noted that there was nothing in the Royalty Agreement that explicitly set out Barsi’s contractual obligation to pay overdue rent or the amount that might be owed. The claim for summary judgment on this ground also failed.

JHD also sought an order for “indemnification under para 10 of the Contract.” Paragraph 10 required Barsi to indemnify JHD for “damages or loss suffered by JHD or caused by a breach of this agreement.” The application did not specify what indemnification was sought. JHD’s written submissions referred in a general way to “loss of its branch office and employees,” and appeared to seek an admission of liability and quantum. The court held that Barsi was under no obligation to admit anything and that it could not order a party to make an admission. The court further held that JHD had not provided evidence that a breach of the Royalty Agreement had caused loss or damage, or established the quantum of any such loss. This claim for summary judgment also failed.

Application to strike or summarily dismiss the counterclaim

Barsi’s Counterclaim alleged that JHD, through Mr. Harms, made false and negative statements about Barsi to its clients and misrepresented the amount of aggregate reserves within the Seal Lake Lease. These allegations were supported by an Affidavit of Craig Barsi that repeated statements made to him by Don Goulet.

It was not clear from JHD’s application whether it was seeking to strike the Counterclaim under Rule 3.68 (for non-compliance with pleading rules, including Rules 13.6 and 13.7 on misrepresentation) or whether it sought summary dismissal under Rule 7.3. JHD’s written submissions tended to focus on the credibility of the allegations and the fact that some evidence was based on information and belief.

The court noted that Rule 3.68 gives authority to strike pleadings when circumstances warrant and a condition under subrule (2) applies. The court held that even if the Counterclaim did not fully comply with Rules 13.6 and 13.7, the appropriate remedy at that stage was amendment, not dismissal, and it declined to strike the Counterclaim.

Regarding summary dismissal, the court emphasized that deficiencies in JHD’s own application and materials made it difficult to identify the exact basis for its request to dismiss the Counterclaim, and that this made it difficult for Barsi to respond. The court concluded that the proper approach was for Barsi to take steps to amend its Counterclaim to comply with the pleading rules, after which JHD could consider bringing a properly framed summary dismissal application if it wished. JHD’s application to strike or summarily dismiss the Counterclaim was therefore dismissed.

Outcome of the first decision

In conclusion, the court held that JHD had not established any basis for summary judgment in its favour and had not established a basis for striking or summarily dismissing the Counterclaim. The application was dismissed. The court directed that Barsi have its costs of the application and invited submissions on the quantum if the parties could not agree, and directed the parties to schedule a further case management meeting.

Costs decision and enhanced costs (2025 ABKB 456 – JHD #2)

In the separate costs decision, the court addressed the quantum of costs payable to Barsi for the dismissed summary judgment application. JHD’s Statement of Claim advanced a claim exceeding $4.0 million. Barsi argued that costs should therefore be based on Column 5 of Schedule C. Using Column 5 alone would produce costs of $6,750 ($2,700 for an application requiring written briefs and $4,050 for oral questioning under Part 5). Barsi sought enhanced costs of $15,000.

JHD argued that costs of $4,725 were reasonable. It submitted that, because JHD had made an offer of settlement and several concessions that reduced the effective value of its claim to $560,000, Column 3 rather than Column 5 should apply. JHD also argued that the matter was not as complex as Barsi suggested.

The court referred to Rule 10.31, Rule 10.33, and to authorities including JBRO Holdings Inc v Dynasty Power Inc, McAllister v Calgary (City), Geophysical Service Incorporated v Canadian Natural Resources Limited, Jordan v Power, and Goldstick Estates (Re). The court observed that the amount claimed in the originating document “sets the ‘tone’” for costs and that the greater the amount claimed, the more it typically costs to defend. The court noted that JHD had advanced a claim exceeding $4.0 million in the Statement of Claim and that if this amount was not realistic, JHD could have amended its Statement of Claim.

The court held that the appropriate amount to use was the amount claimed in the Statement of Claim and that the starting point for costs was therefore Column 5. The court found that the other factors in Rule 10.33(1) and (2) did not justify using a lower column.

The court then considered whether enhanced costs were appropriate. It referred to Rule 1.2 as a “foundational” rule and noted that JHD’s application, the manner in which it was presented, and the material filed were highly inefficient and made the application more complex than necessary, requiring significant time for Barsi to respond. The court noted that JHD’s Statement of Claim was lengthy and evidence-laden, that JHD’s materials were extremely voluminous and included irrelevant and duplicative items, and that the application identified 11 issues, some unclear and duplicative. The court was careful to state that JHD had not engaged in bad faith or reprehensible conduct or made allegations like fraud that would attract more severe enhanced costs, but found that JHD’s conduct nevertheless justified some form of enhanced costs.

Barsi argued that more than 70 hours of counsel time were needed to defend the application, but the court found there was no evidence to assess the reasonableness of that estimate. Instead, the court used a multiplier approach and determined that it was appropriate to award double Column 5 costs. Because single Column 5 costs totalled $6,750, the court awarded total costs of $13,500.

The court concluded that Barsi was entitled to costs in the total amount of $13,500, payable by JHD forthwith.

Settlement negotiations and dispute (2026 ABKB 48 – JHD #3)

After the costs decision, the parties engaged in settlement discussions, conducted by email and attached as an exhibit to an affidavit from Craig Barsi. The Defendants later applied for summary dismissal of JHD’s claim and a declaration that the parties had a binding settlement agreement.

The email record showed that on July 7, 2025, the Plaintiff inquired whether the Defendants would advise the terms under which they were prepared to resolve “this matter.” Defence counsel replied that they would consider a settlement “along the lines of a fair split of the proceeds from the sale of the gravel that is sitting on the property.”

On July 9, 2025, Mr. Harms replied, raising concerns about “decade arrears of rent,” reclamation, recertification, and monitoring obligations, and suggesting that these could amount to contingent liability of “up to a quarter million or more,” and asked whether the Defendants would assume a portion of that liability. He stated, “I am assuming that your client prefers the lease and all lease responsibilities to stay with JHD.”

Later that day, defence counsel replied that his client would not agree to be responsible for reclamation or similar matters and that any deal would be limited to selling the gravel and splitting the proceeds, with the percentage split open to discussion. He asked whether JHD would settle for a split of the proceeds and what percentage JHD proposed.

The next day, Mr. Harms proposed a “partial settlement” under which the Defendants would retain the gravel and have the right to sell it, JHD would retain the Seal Lease and waive certain rent, reclamation, non-renewal and “other lease-duties” claims and “assignment or non-assignment claims or defences,” and the litigation would continue regarding all other claims. Defence counsel advised that his client would not agree to any partial settlement.

On July 21, 2025, Mr. Harms emailed defence counsel, stating, “We understand your proposal to be full discontinuances all around without costs, and sale of the gravel pile 50/50. Is that correct?” Defence counsel replied, “Yes, we would need a full release as part of that. This offer is open until the end of this month.”

On July 30, 2025, Mr. Harms wrote, “JHD accepts your offer sale of the gravel pile with proceeds to be split 50-50 as has been proposed by you in the past. This would be a full settlement of the main claim and the counter claim without costs.”

On August 7, 2025, defence counsel responded, “I confirm we are in agreement and we have a deal as follows,” and then listed three terms: (1) the parties would use reasonable efforts to sell the gravel pile and split the net proceeds 50/50; (2) the main claim and counterclaim would be discontinued on a without-costs basis; and (3) there would be a full mutual release between the parties. He stated that he would send a draft settlement agreement.

Defence counsel sent a draft Settlement Agreement and discontinuance on August 11, 2025, and followed up on August 21, 2025. On August 30, 2025, Mr. Harms sent a revised settlement agreement “for review,” which included a provision that the Defendants would pay JHD $40,000. Defence counsel replied that in his view “we have a settlement” and asked if Mr. Harms was trying to change the terms. In a later exchange, Mr. Harms said the settlement needed to reflect that the Defendants would “pay all royalties that are owed to the Government of Alberta.” Defence counsel responded that paying royalties “was never part of the deal” and advised that he would bring an application.

The Plaintiff filed a “Response to Barsi Application for November 28, 2025” seeking leave to cross-examine Mr. Barsi on his affidavit, an order directing Barsi to pay royalties and dismissing the Defendants’ Settlement Agreement, and a “re-hearing” of its summary judgment application. This document provided argument in response to the Defendants’ application but was not supported by a separate formal application for that relief.

Finding of a binding settlement and summary dismissal (2026 ABKB 48 – JHD #3)

The court identified the issues as whether the parties had entered a binding settlement agreement and, if so, whether the action should be summarily dismissed. The court noted that the Defendants argued that the Settlement Agreement was clear and straightforward and did not include any provision for a payment by the Defendants to the Plaintiff or assumption of royalty liability, and that the Plaintiff argued that it was unrealistic, given the factual matrix, to think JHD would assume liability for royalties, which it believed the Defendants would pay.

The court observed that throughout the Settlement Emails the Defendants’ position was that they would not assume reclamation or similar liabilities and that any settlement would consist of selling the gravel and splitting the proceeds, with full releases and a global discontinuance. The court noted that Mr. Harms attempted to persuade the Defendants to assume some responsibility for liabilities associated with the lease but that these attempts were unsuccessful, and that from his July 9, 2025 email, Mr. Harms clearly understood that the Defendants’ position was that “lease and all lease responsibilities” would stay with JHD.

The court found that even though royalties were never expressly mentioned by either party in the Settlement Emails, royalty payments formed part of the “lease responsibilities” that the Plaintiff wanted the Defendants to assume. The court also noted that both parties were represented by counsel, that it was JHD that first raised settlement, and that there was no suggestion of coercion or undue influence.

The court set out the law that a settlement agreement is a contract and that enforceability requires mutual intention to create a legally binding contract and agreement on essential terms. The court referred to Beier v Proper Cat Construction Ltd. and Olivieri v Sherman, and again cited Sattva on the modern approach to contractual interpretation.

The court held that the Settlement Emails showed the parties intended to create a binding settlement agreement. It found that the essential terms were clear: the gravel pile would be sold, net proceeds would be split 50/50, the main claim and counterclaim would be discontinued on a without-costs basis, and there would be a full mutual release. The court held that liability for royalties was not an essential term of the settlement and that the Defendants had clearly rejected attempts by the Plaintiff to have them assume such liabilities.

The court found that Mr. Harms’s July 30, 2025 email was an acceptance of the settlement proposal and that there was nothing in that acceptance suggesting that the agreement was incomplete, conditional, or that it included assumption of royalties. The court found that the Plaintiff’s later assertion that it “assumed” the Defendants would pay royalties was not supported by the emails and did not undermine the existence of a binding agreement.

The court concluded that the parties had reached a binding Settlement Agreement and that its terms were reflected in the proposed Settlement Agreement attached to defence counsel’s August 11, 2025 email.

Turning to summary dismissal under Rule 7.3(1)(b), the court applied Weir-Jones and PricewaterhouseCoopers and held that the record was sufficiently certain to resolve the issue on a summary basis. It found that the settlement agreement resolved the dispute between the parties, leaving no genuine issue requiring trial, because the gravel would be sold and proceeds split, and the main action and counterclaim would be discontinued with full mutual releases.

The court therefore granted the Defendants’ application. It declared that the parties had entered into a binding settlement agreement in the form attached to defence counsel’s August 11, 2025 email and dismissed JHD’s action. The court held that as the Defendants were the successful parties they were presumptively entitled to their costs of the application and invited written submissions on costs if the parties could not agree.

This summary is based solely on the facts, dates, amounts, names, and statements contained in the three decisions and does not constitute legal advice.