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Contracts - Specific Term - 'Profit'. Pinnacle International (One Yonge) Ltd. v. Torstar Corporation
In Pinnacle International (One Yonge) Ltd. v. Torstar Corporation (Ont CA, 2024) the Ontario Court of Appeal allowed an appeal, here in a sublease profit-sharing dispute.
Here the court considers the meaning of the term 'profit', in a contractual context:[87] Second, it is commercially absurd to interpret the word “profit” in art. 8. 1 to require Torstar to pay Pinnacle over $1.1 million for subleasing space when Torstar actually incurred a $2.6 million loss on the sublet premises.
[88] “Profit” is not defined in the Lease. Thus, it is to be given its ordinary and grammatical meaning, so long as that meaning is consistent with the surrounding circumstances known to the parties at the time of formation of the Lease: Sattva, at para. 47. The meaning of profit in the caselaw accords with its ordinary dictionary meaning. I see nothing in the factual matrix to suggest it should be given any other meaning.
[89] Profit is determined by setting against revenues, the expenses incurred in earning income: Canderel Ltd. v. R, 1998 CanLII 846 (SCC), [1998] 1 S.C.R. 147, 155 DLR (4th) 257, at para. 53. Although this meaning of profit was given in the context of determining a taxpayer’s profit, it accords with the dictionary definition of profit as “the excess of returns over expenditure in a transaction or series of transactions”: Merriam-Webster Dictionary, online: https://www.merriam-webster.com/dictionary/profit, retrieved on September 6, 2024.
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