Looking Glass Group v. Tidysquares Limited | Canadian Lawyer

12 Feb 2024

Looking Glass Group v. Tidysquares Limited

Overview:
LGG filed an application against Tidysquares for payment under a marketing agreement. The agreement stipulated LGG would be paid commissions on sales via online platforms or a minimum payment if Tidysquares failed to provide inventory ("Minimum Payments Clause"). The clause was void if inventory shortages were due to uncontrollable factors ("Force Majeure Clause").
Core Issues Addressed:
1. Whether Tidysquares intentionally stopped supplying inventory.
2. Whether LGG waived its right to payments under the Minimum Payments Clause.
3. Calculation of the amount owed under the clause.
4. If the Minimum Payments Clause is an unenforceable penalty clause.
Findings:
Intentional Cessation of Supply: The court concluded Tidysquares intentionally stopped supplying inventory, not due to any uncontrollable factors. The cessation aligned with Tidysquares' strategic shift away from e-commerce under new ownership.
No Waiver by LGG: The court found that LGG did not waive its entitlement to the minimum payments, as any waiver required written consent, which was not provided.
Amount Owed: Tidysquares was ordered to pay LGG $62,400 USD, representing $2,000 per month per retailer account for the period they stopped supplying inventory.
Clause Enforceability: The Minimum Payments Clause was not an unenforceable penalty, as it was a reasonable pre-estimate of damages agreed upon during negotiations.
Conclusion:
Judgment: The court awarded LGG damages of $62,400 USD. The decision emphasized that LGG’s entitlement to the minimum payments was justified due to Tidysquares' intentional actions and that no waiver or unenforceable penalty existed.
The court encouraged the parties to settle costs without further submissions.

Download documents

Looking Glass Group v. Tidysquares Limited.pdf

Applicant

LOOKING GLASS GROUP LTD.

Law Firm / Organization

Not specified

Lawyer(s)

Respondent

TIDYSQUARES LIMITED

Law Firm / Organization

Not specified

Lawyer(s)

Wolfgang Kaufmann

Court

Superior Court of Justice - Ontario

Case Number

CV-22-00680592-0000

Practice Area

Civil litigation

Amount

$ 84,540

Winner

Applicant

Trial Start Date