Negligence – Solicitors Negligence – Breach of Contract – Breach of Fiduciary Duty – Conflict of Interest – Punitive Damages – Expert Evidence
Tim Bates, Christine Fotopoulos and Christina Poretta for Gowlings

This case arose out of an agreement by the Plaintiffs to acquire a discount grocery chain. The Defendant law firm was retained to provide legal advice with respect to the transaction. When the Plaintiffs' business failed and a receiver was appointed by the bank that had financed the acquisition, they brought this action against Gowlings alleging negligent provision of legal services, breach of contract, conflict of interest in having acted for Mr. Black, the principal of the acquiring company, and his friend Mr. Brown, an investor, and breach of fiduciary duty, claiming over $10 million in compensatory damages and punitive damages. The Plaintiffs said that the business failed because of the failure of certain leases, the non-transfer of certain employees, and breaches of certain representations made by the vendors, all of which they claimed Gowlings was obliged to provide them with adequate protection against and failed to do. Gowlings denied liability on all grounds, and in any event argued that the Plaintiffs had suffered no losses. Finally, Gowlings asserted that any damages that could be claimed in the action would vest in the receiver who was not named as one of the plaintiffs.