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Fiduciary - Remedies for Breach. Stirrett v. Cheema
In Stirrett v. Cheema (Ont CA, 2020) the Court of Appeal drew a distinction between remedies for equitable breaches (compensation) and legal breaches (damages), but noted that the term 'damages' are often used interchangeably:[68] Compensation for breach of fiduciary duty is typically determined according to restitutionary principles, where the plaintiff is entitled to be put in as good a position as he or she would have been in had the breach not occurred: Hodgkinson, at p. 440, per La Forest J. In M. (K.) v. M. (H.), 1992 CanLII 31 (SCC), [1992] 3 S.C.R. 6, La Forest J., writing for the majority, pointed out that in equity there is no capacity to award damages and that the distinction between damages and compensation is often slight, with the courts tending to merge the principles of law and equity when necessary to achieve a just remedy: at pp. 80-81. Over time, courts have used the term “damages” to denote monetary compensation for breach of fiduciary duty. Remedies in cases of breach of fiduciary duty (such as disgorgement of profits and exemplary compensation) can also have a prophylactic or deterrent purpose: Strother v. 3464920 Canada Inc., 2007 SCC 24, [2007] 2 S.C.R. 177, at paras. 74-77. Irrespective of the purpose, there must be a causal link between the breach of fiduciary duty and the compensation sought. . 410784 Ontario Limited v. Little Zinger Inc. (Corktown Esso)
In 410784 Ontario Limited v. Little Zinger Inc. (Corktown Esso) (Ont CA, 2016) the Court of Appeal made the following comment on the calculation of damages for breach of fiduciary duty:She properly instructed herself on the law in relation to the calculation of damages for breach of fiduciary duty and relied on GasTOPS Ltd. v. Forsyth, 2009 CanLII 66153 (ON SC), 2009 CanLII 66153 (Ont. S.C.), at para. 1479, aff’d 2012 ONCA 134 (CanLII), for the proposition that:A precise calculation, therefore, is not required. Rather an estimate of what may have been lost by the plaintiff due to the defendant’s breach, subject to a reduction for contingencies, is the proper approach …
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