NEWS: Iqaluit March 12, 2018 - 8:00 am

Appeal court puts a lid on Iqaluit restaurant’s civil suit

Owners' appeal denied by panel of judges


The owners of a closed Iqaluit restaurant and bar have failed in a last-ditch effort to overturn a judge’s decision that effectively forced their business to close last summer, after their appeal was denied by a panel of judges last month.

Kim and Donna Waters, who owned the Waters Edge Seafood and Steakhouse restaurant and the adjacent Kickin’ Caribou Pub, closed both establishments last August, according to the terms of a lease signed with their landlord, Northview Property Real Estate Ltd, or NPR.

The restaurant’s exit from the Hotel Arctic allowed NPR to sell the building to Qikiqtaaluk Properties for $14.9 million, which in turn leased it to Nunavut Arctic College to use as classroom space and dormitories.

But the Waters claimed in a legal suit last summer that an amendment was negotiated with NPR allowing them to renew their lease, which they allege was not honoured by their landlords.

According to the details of that suit, the Waters alleged that their representative met with an NPR property manager, who “shook hands on it,” before “flipping a coin,” as symbolic payment for kitchen appliances that were turned over to the restaurant ownership.

But both the representative and the NPR manager denied in court that they ever reached a deal, shook hands or tossed a coin.

The Waters’ suit was ultimately denied following a five-day trial last summer, when Nunavut Justice Paul Bychok ruled that the Waters never communicated their acceptance of a proposed amendment to their lease offered by NPR in 2013.

But that didn’t matter either, Bychok said, because the Waters were already in breach of “good standing” requirements under the terms of their lease by the next year, although the restaurant was able to continue operating after the Waters won a court injunction against being evicted by NPR.

The Nunavut Court of Appeal, in a March 3 ruling, agreed with Bychok on all counts, dismissing claims by the Waters that he erred when ruling that no signed amendment existed that provided the owners with an option to renew their lease.

The Waters also gave the appeal court an alternative argument: that upgrades to and investments into the restaurant, paid for by them, were performed under the assumption that the amendment had been agreed upon, under a legal term called “part performance.”

But that argument fell flat with the appeal judges as well, who ruled that Bychok was within his right to rule that the motivation behind the restaurant’s renovations was ambiguous, because the 2013 court injunction had already ordered the owners to spend money on upgrading the establishment.

“When there are two possible agreements to which the acts of the tenant can refer, this is insufficient to find part performance,” the appeal judges said in their decision.