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e.

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BCICAC File No. DCA-1923
IN THE MATTER OF AN ARBITRATION
BRITISH COLUMBIA INTERNATIONAL COMMERCIAL ARBITRATION CENTRE
Between:
QUATSINO FIRST NATION
Claimant
and:
ELECTRA STONE LTD. (FORMERLY ELECTRA GOLD LTD.)
Respondent
REASONS FOR AWARD
Geoff Plant, Q.C.
Sole Arbitrator
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DECISION
I. FACTS
A. Background
1. This dispute relates to a Mining Participation and Royalty Agreement dated August 21, 2003 (the “Agreement”), between the Claimant Quatsino First Nation (“Quatsino”) and the Respondent Electra Stone Ltd. (formerly Electra Gold Ltd., “Electra”).
2. The Claimant issued a Notice to Arbitrate filed with the BC International Commercial Arbitration Centre (the “BCICAC”) on October 26, 2017.
3. The Claimant filed its Statement of Claim with the BCICAC on November 3, 2017, seeking, inter alia:
(a) A declaration that the Respondent breached the Agreement;
(b) Damages for breach of the Agreement; and
(c) Costs.
4. The Respondent filed a Statement of Defence dated January 5, 2018.
5. I was appointed sole arbitrator on November 21, 2017. I am satisfied that I have jurisdiction to decide this claim pursuant to section 24 of the Agreement.
6. The Statement of Claim has been revised several times after it was originally filed, and is most recently set out in the Revised Further Amended Statement of Claim dated January 18, 2018 (the “Claim”).
7. Subsequent to the original Statement of Claim filed on November 3, 2017, the Claimant added a claim against Mr. John Costigan, identified as the former President, CEO and director of Electra. Mr. Costigan thereupon retained counsel, who filed a petition in the BC Supreme Court for an order that Mr. Costigan was not a party to this Arbitration and a declaration that I had no jurisdiction to award the relief sought against him. Prior to the hearing of that petition, the Claimant revised its Claim, removing the claims against Mr. Costigan.
8. By consent and pursuant to my procedural direction, this Arbitration is proceeding on the basis of written evidence and submissions without a hearing. The evidence consists
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primarily of the Agreement and related documents, and the Respondent’s financial documents, including the management discussion and analysis and financial statements filed with SEDAR. I heard no oral evidence and no affidavits were filed, but neither party have raised any issues with respect to the material facts.
9. The Claimant is represented by counsel. The Respondent is represented by Mr. Tony Hu, Electra’s current President and CEO.
B. The Parties
10. The Claimant, Quatsino First Nation, is an Indian Band within the meaning of the Indian Act, R.S.C., 1985, c. I-5, whose traditional territory encompasses the Quatsino Inlet, Coal Harbour and Winter Harbour in northern Vancouver Island.
11. The Respondent, Electra Stone Ltd., formerly Electra Gold Ltd., is a company incorporated under the laws of British Columbia, with a head office at 248 - 515 West Pender Street Vancouver, BC V6B 6H5.
12. Electra is a reporting issuer, as defined in the Securities Act, RSBC 1996, c. 418. On or about February 2, 2015, the Respondent changed its name from Electra Gold Ltd. to Electra Stone Ltd.
C. The Mining Participation and Royalty Agreement
13. In or about 2002, the Respondent entered into a sublease agreement with holders of mineral claims on Quatsino’s lands, and began operating the PEM100 Quarry (the “Mine”) pursuant to this sublease agreement. The terms of the sublease agreement are not at issue and therefore are not canvassed in these reasons.
14. On or about August 21, 2003, the parties entered into the Agreement, which provided, inter alia, an exclusive right for Electra to remove all minerals except for precious metals, base minerals, and diamonds from the Claimant’s traditional territory, in exchange for royalty payments.
15. The royalty payments are defined in section 9 of the Agreement, and are at the centre of this dispute.
16. The relevant portions of section 9 of the Agreement set out as follows:
9.1 Electra has agreed with Howich and Homegold to fix their royalty rate at $1.00, as set out in the Howish/Homegold/Shearer lease Agreement attached hereto, and Quatsino
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Nation has agreed to fix its royalty rate at $1.00. It is expressly agreed between the parties that Electra shall not amend or vary the terms of the Howich/Homegold/Shearer Lease Agreement in any fashion, or enter into any other Agreement with Howich, Homegold, or Shearer with respect to any matter relating to the Mineral Claims, without the written consent of Quatsino Nation, which consent is subject to the Quatsino Nation having the opportunity of varying the terms of this Agreement but shall not otherwise be unreasonably withheld or delegated.
9.2 Electra will pay to the Quatsino Nation a royalty (the “Royalty”) as follows:
(a) $1.00 for each metric tonne of Industrial Minerals production from the Mineral Claims, (which includes the 13,000 tonnes of Industrial Minerals removed as July 1, 2003);
...
9.3 The parties agree that Electra will use its best commercially reasonable efforts to sell Industrial Minerals of at least 100,000 metric tonnes a calendar year, and preferably 200,000 tonnes a calendar year. However, it is possible that initially, the production or sales from the Mineral Claims may not reach 200,000 tonnes a calendar year. Until such time as the production or sales meets or exceeds 200,000 tonnes a calendar year, only a portion of the royalty will be paid as indicated below (the “Current Royalty Payment”) and the balance will be deferred (the “Deferred Royalty Payment”), as follows:
(a) $0.50 for each metric tonne of Industrial Minerals productions from the Mineral Claims will be due as “Current Royalty Payment”; and
(b) $0.50 for each metric ton of Industrial Minerals production from the Mineral Claims will be due as a “Deferred Royalty Payment”,
9.4 As soon as the production from the Mineral Claims meets or exceeds 200,000 metric tonnes in a calendar year (the “Year”), the entire $1.00 per metric tonne royalty will become a Current Royalty Payment, calculated on all productions from January 1st of that Year, and for each year thereafter so long as production exceeds 200,000 tonnes a year.
9.5 The Current Royalty Payment will be made quarterly within 30 days after the end of each yearly quarter based upon a year commencing on the 1st day of January and expiring on the 31st day of December in any year in which are produced or removed from the Properties, based on the amount of Industrial Minerals removed as determined by Marine Survey. Within 140 days after the end of each year for which the Current Royalty payments are payable, the records relating to the calculation of the Current Royalty Payments for such a year will be audited by Electra and any adjustments in the payment of the Current Royalty Payment wills will be made forthwith after completion of the audit. All payments of the Current Royalty Payments for a year will be deemed final and in full satisfaction of
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all obligations of Electra in respect thereof if such payments or calculations thereof are not disputed by Electra or the Quatsino Nation, as the case may be, within 60 days after receipt by Electra or the Quatsino Nation of the said audit statement. Electra will maintain accurate records relevant to the determination of the Current Royalty Payments and each of Electra and the Quatsino Nation, or its authorized agent, shall be permitted the right to examine such records at all reasonable times.
9.6 The Deferred Royalty Payment will be calculated quarterly within 30 days after the end of each yearly quarter based upon a year commencing on the 1st day of January and expiring on the 31st day of December in any year in which are produced or removed from the Mineral Claims. Within 140 days after the end of each year, for which the Deferred Royalty Payments are calculated, the records relating to the calculations of the Deferred Royalty Payments for such year will be audited by Electra and any adjustments in the calculation of the Deferred Royalty Payments will be made forthwith after completion of the audit. All calculations of the Deferred Royalty Payments for a year will be deemed final and in full satisfaction of all obligations of Electra in respect thereof if such calculations thereof are not disputed by Electra or the Quatsino Nation, as the case may be, within 60 days after receipt by Electra or the Quatsino Nation of the said audit statement. Electra will maintain accurate records relevant to the determination of the Deferred Royalty Payments and each of Electra and the Quatsino nation, or its authorized agent, shall be permitted the right to examine such records at all reasonable times. The Deferred Royalty Payment shall be recorded as an Account Payable to the Quatsino Nation, without interest, and paid pursuant to paragraph 9.6 herein.
9.7 As soon as the production from the Mineral Claims exceeds 275,000 metric tonnes in one calendar year, all accrued by unpaid Deferred Royalty payments will become due and owing, and shall be paid to the Quatsino nation in four equal instalment payments quarterly.
(Emphasis added)
II. LEGAL ISSUES
A. Interpretation of the Royalty Provisions
17. In resolving disputes that arise out of contractual interpretation, it is important to keep in mind the two important principles that the Supreme Court of Canada set out in Bhasin v. Hrynew, [2014] 3 S.C.R. 494, namely, that a contracting party must perform contractual obligations in good faith, and have appropriate regard to the interests of his contracting partner. It is with this framework in mind that I analyze the specific provisions in the Agreement relating to the Royalty (as defined in the Agreement).
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18. Pursuant to the Agreement, the payment of the Royalty was divided into two stages. Section 9.2(a) sets out that the Royalty is “$1.00 for each metric tonne of Industrial Minerals production...”.
19. Section 9.3 breaks down the definition of Royalty into two types of royalty payments: a Current Royalty Payment and a Deferred Royalty Payment, at $0.50 each.
B. The Current Royalty Payment
20. There are no disputes about the interpretation of the Current Royalty Payment, although there appears to be some dispute about the quantum.
21. The Respondent concedes that the Current Royalty Payment is outstanding and owing, and submits that $69,604.02 in Current Royalty Payment is owing.
22. Pursuant to section 9.5 of the Agreement, the Current Royalty Payment is to be paid within 30 days of each quarter for every year that minerals are removed.
23. The Claimant claims that a total of $75,716 is owing as a Current Royalty Payment, consisting of the total volume extracted of 900,678.85 metric tonnes since 2004, therefore a total Current Royalty Payment of $450,339, minus the amount already paid by the Respondent, being $374,623.
24. The Respondent has not submitted any admissible evidence to substantiate their assertion that the Current Royalty Payment owing is $69,604.02. In the most recent audited financial statements published on SEDAR, Electra reports the Current Royalty Payment outstanding as $71,994.
25. Section 9.5 also sets out that the Respondent is responsible for keeping records relating to the calculation of the Current Royalty Payment, and that the Claimant has the right to dispute records or statements kept by the Respondent:
Within 140 days after the end of each year for which the Current Royalty payments are payable, the records relating to the calculation of the Current Royalty Payments for such a year will be audited by Electra and any adjustments in the payment of the Current Royalty Payment will be made forthwith after completion of the audit. All payments of the Current Royalty Payments for a year will be deemed final and in full satisfaction of all obligations of Electra in respect thereof if such payments or calculations thereof are not disputed by Electra or the Quatsino Nation, as the case may be, within 60 days after receipt by Electra or the Quatsino Nation of the said audit statement.
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26. The Claimant takes the position that they never received audited financial statements. While it may be the case that the Respondent did not deliver such statements to the Claimant, the Respondent is a publicly traded company, and the audited financial statements of the Respondent are posted online on SEDAR, as required by securities regulation.
27. Consequently, I find that the Claimant effectively received the audited financial statements on the date that they were published to SEDAR each year.
28. It does not appear that the Claimant ever initiated any disputes within 60 days of the audited financial statements being published.
29. Therefore, I find that the amount set out in the Respondent’s 2017 audited financial statements, $71,994, to be the amount of the Current Royalty Payment outstanding.
C. The Deferred Royalty Payment
30. With respect to the Deferred Royalty Payment, there is considerable dispute relating to the intentions of the parties when the Agreement was entered into.
31. Although the Agreement stipulates that the Royalty to be paid per tonne was $1.00, the Agreement defers $0.50 of this price to be payable only when production reaches the 200,000 tonnes per calendar year (the “Production Threshold”). Specifically, sections 9.4 and 9.6 set out that:
9.4 As soon as the production from the Mineral Claims meets or exceeds 200,000 metric tonnes in a calendar year (the “Year”), the entire $1.00 per metric tonne royalty will become a Current Royalty Payment, calculated on all productions from January 1st of that Year, and for each year thereafter so long as production exceeds 200,000 tonnes a year.
...
9.6 The Deferred Royalty Payment will be calculated quarterly within 30 days after the end of each yearly quarter...
(Emphasis added)
32. The critical point that the Agreement fails to explicitly set out is the treatment of the Deferred Royalty Payment if the Production Threshold is not reached.
33. The Claimant submits that on the face of the Agreement, the parties clearly intended that the Deferred Royalty Payment would be payable eventually, regardless of whether the Production Threshold was reached.
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34. The Claimant further submits that the Respondent also intended this to be the case, as the Respondent had classified the amount of the Deferred Royalty Payment as a liability owing under the Agreement in its audited financial statements from 2004 to 2015.
35. Examples of this can be seen in the annual audited financial statements of the Respondent for the years 2003 – 2016, where the company has consistently stated that “[a] royalty of $1.00 per metric tonne is also payable”, at:
(a) Note 4 in the 2003 – 2005 audited financial statements;
(b) Note 8 in the 2006 – 2007 audited financial statements, with slightly different wording: “A royalty of $1.00 per metric tonne of ore mined is payable”;
(c) Note 8 in the 2008 – 2012 audited financial statements;
(d) Note 9 in the 2013 audited financial statements;
(e) Note 10 in the 2014 audited financial statements; and
(f) Note 11 in the 2015 – 2016 audited financial statements.
36. As of December 31, 2015, the Respondent reclassified the $420,807 Deferred Royalty Payment outstanding from an account payable liability to the Respondent’s profit and loss.
37. I understand that the parties entered into discussions on or about January 17, 2017 to try and resolve the matters, but did not reach settlement. The Respondent makes specific reference to these discussions. However, as they were stated to be without prejudice, these discussions will not be referenced or referred to in my decision.
38. The Claimant further submits that the Respondent repudiated the Agreement by selling the Mine prior to performing half of the Royalty obligations, thereby triggering the Deferred Royalty Payment, making it due immediately.
39. The Respondent submits that the Deferred Royalty Payment is not owing for the following reasons:
(a) The Agreement expired and therefore the terms no longer continue after the termination, including the obligation of paying the Deferred Royalty Payment;
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(b) The Deferred Royalty Payment is no longer being carried in Electra’s books; and
(c) The parties always understood that $0.50 was the price per tonne agreed to, and the additional $0.50 agreed to as Deferred Royalty Payment was subject to a condition precedent, with the condition being that the Production Threshold must be reached before it is payable.
40. In interpreting the Agreement, all words in the Agreement must be given effect. While the Agreement does not set out specifically the consequence of the Production Threshold not being met, two sections provide guidance in this respect.
41. First, section 9.6 provides that the Deferred Royalty Payment will be audited within 140 days after the end of each calendar year, with adjustments made forthwith after the completion of the audit. Further, Quatsino may dispute the audited records within 60 days after the audited statements are sent or published, and finally, if Quatsino does not dispute the records, the amount will be recorded as an Account Payable (as defined in the Agreement).
42. Second, section 9.7 provides that if the production exceeds 275,000 metric tonnes in one calendar year, all accrued but unpaid Deferred Royalty Payments will become due and owing.
43. As set out in section 9.6, the Deferred Royalty Payment is only payable for a certain year once the Production Threshold for that year is met, unless the production reaches 275,000 metric tonnes, at which point the entire Deferred Royalty Payment is payable pursuant to section 9.7.
44. The only other logical interpretation for the Deferred Royalty Payment is that if the Production Threshold is not reached within a certain year, it expires at the end of that year, and is no longer owing in future years.
45. However, given the meanings of the words in sections 9.6 and 9.7, both parties clearly contemplated that the Deferred Royalty Payments would be kept on Electra’s books beyond a particular calendar year as an account payable. Therefore, the parties could not have contemplated that the Deferred Royalty Payment expired at the end of every year.
46. As previously stated, it is important to keep in mind the commercial purpose of the Agreement and the principles in Bhasin when interpreting the parties’ intentions.
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47. In this case, it is clear from the words of the Agreement that the parties intended for $1.00 to be the price per tonne for all minerals produced. However, in order to allow Electra time to increase production, half of that amount is deferred until the Production Threshold is reached. This is a common commercial purpose for deferring certain payments, in order to encourage junior mining companies to start production and alleviating the strain on cash flow that these companies often face when first starting production.
48. Further, it is evidence that both parties contemplated the contractual obligations to be performed in good faith, with the Claimant having appropriate regard to the interests of the Respondent in deferring the Deferred Royalty Payments.
49. However, I do not find that this deferral in good faith equates to the Claimant agreeing to indefinitely defer the Deferred Royalty Payments, or to give up on them entirely if the Production Threshold is not met.
50. This is further evidenced by the wording of the Agreement itself, at section 9.3, where it states:
However, it is possible that initially, the production or sales from the Mineral Claims may not reach 200,000 tonnes a calendar year.
51. It is clear from section 9.3 that the parties were negotiating in good faith, and agreed on a commercially reasonable payment plan in order to allow the Respondent better access to cash flow in the early years of its production, by deferring certain portions of the payment.
52. As stated by Lord Reid in L Schuler AG v Wickamn Machine Tool Sales Ltd., [1974] AC 235 at 251:
The fact that a particular construction leads to a very unreasonable result must be a relevant consideration. The more unreasonable the result the more unlikely it is that the parties can have intended it, and if they do intend it the more necessary it is that they should make that intention abundantly clear.
53. Based on the words of the Agreement and the conduct of the Respondent, I do not find it probable, on a balance of probabilities, that the Respondent intended that the Deferred Royalty Payment would expire either at the end of each calendar year, or at the expiration of the Agreement.
54. If the Deferred Royalty Payment is interpreted as suggested by the Respondent, that it expired when the Agreement expired, it would effectively render portions of the words in sections 9.1 – 9.4 meaningless, specifically those relating to $1.00 per metric tonne being
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the amount payable, as well as conflicting with portions of its own audited financial statements, and management discussion and analysis for the years 2004 – 2015.
55. Had the parties intended for the Deferred Royalty Payments to expire, and ignore the rest of the language in sections 9.1 – 9.4 stipulating the royalty of $1.00 per metric tonne, they would have made this intention abundantly clear. This is a material change in one of the fundamental clauses of the Agreement, and I find it unlikely that the Respondent would have failed to include an explicit term of expiration, had it intended it to be so.
56. Based on the lack of specific wording in the Agreement relating to the expiration of the Deferred Royalty Payments, combined with the Respondent’s own audited financial statements, I find it more probable that the parties intended that the Deferred Royalty Payments would:
(a) Be deferred until the Respondent was able to ramp up production;
(b) Be calculated each quarter, concurrently with the Current Royalty Payment;
(c) Become a Current Royalty Payment for a calendar year once the Production Threshold is met for that year;
(d) Be payable in its entirely, including all accrued amounts for past years in the Respondent’s account payable, once production meets 275,000 per metric ton; and
(e) If the Production Threshold was not met during the life of the Agreement, became due and payable upon the expiration of the Agreement.
57. In the circumstances, the Respondent’s failure to pay the cumulative Deferred Royalty Payments upon the expiration of the Agreement constitutes a breach of the Agreement, entitling the Claimant to damages in the amount of the unpaid Deferred Royalty Payments.
58. On the issue of its intention, the Respondent further asserts that payment of the deferred royalty is very “cumbersome”, and that its acceptance of this term “precedes the current management”, and it does not know the intent of previous management when Electra had entered into the Agreement.
59. A commercial contract must have certainty, otherwise commercial transactions would not be able to proceed smoothly, or in some cases at all. Finding a term cumbersome after an agreement is entered into is not relevant to its interpretation. Further, while the Agreement precedes current management, the Agreement was entered into with Electra, and its
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corporate state of mind and intention includes those of previous management, and it is now bound by the agreements that previous management entered into on behalf of the company.
60. Further, the best evidence of Electra’s corporate statement of mind when it entered into the Agreement, and throughout the life of the Agreement, is set out in its annual audited financial statements and management discussion and analysis, which favour the interpretation set forth by the Claimant.
61. Accordingly, I do not find that the Respondent’s submissions about its current intention to be relevant or persuasive.
D. Limitation Issue
62. A question arises whether the claims are statute barred. The issue is not explicitly raised by the Respondent but is raised in the Claimant’s argument and so I will deal with it here.
63. The Claimant submits that the Respondent has consistently recognized the Current Royalty Payments and the Deferred Royalty Payments as due and owing in its financial statements and therefore acknowledged the debt.
64. In Freeway Properties Inc. v. Genco Resources Ltd., [2012] B.C.J. No. 1219 [Freeway], the BC Court of Appeal held that the audited financial statements published by a company are sufficient to acknowledge a debt if it included the debt as liability on its books.
65. In Freeway, the Court of Appeal held that in order for an acknowledgment of liability in audited financial statements to be sufficient for the purposes of limitation periods:
(a) It is not sufficient to set out a general liability for loans and account payable, and a specific reference to the creditor must be made;
(b) The debtor must specifically acknowledge the debt as due and owing;
(c) The exact amount owing must be set out, including interest, if any; and
(d) The limitation period starts to run on the date the audited financial statements are disclosed to the public, in this case publication on SEDAR.
66. I find that in the present dispute, all of the above criteria are met. In particular, note 11 of the Respondent’s audited financial statements from 2014 – 2016, after the Agreement
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expired, clearly acknowledged that the Deferred Royalty Payments were outstanding and owing to Quatsino.
67. The Respondent contends that “the royalties are no longer being carried on Electra’s books”, referring to note 11 of its 2015 audited financial statements, which states as follows:
A royalty of $1.00 per metric tonne is also payable. Payment for one half of the royalty is deferred until production exceeds 200,000 metric tonnes in a calendar year. The Company has not produced in excess of 200,000 metric tonnes in any year and did not produce in excess of 200,000 metric tonnes in 2015 and, therefore, the amount of $420,807 which had been previously accrued until the deferral arrangement has been reclassified to the Company’s profit and loss at December 31, 2015.
68. The Respondent does not dispute that prior to December 31, 2015, the Deferred Royalty Payments were on its books as an account payable liability owing to the Claimant, and therefore for the reasons that follow, I do not find it necessary to analyze the accounting principles or the propriety of the reclassification of the Deferred Royalty Payments.
69. Under the Court of Appeal’s analysis set out in Freeway, I find that:
(a) Electra published the audited 2015 financial statements on April 29, 2016 on SEDAR; and
(b) Consequently, the limitation period for commencing the Claim would have expired on April 29, 2018.
70. The Claimant filed its Statement of Claim on November 3, 2017, within the limitation period, and is not statute barred. Therefore, I find it unnecessary to deal with the Claimant’s alternative proposal of August 29, 2016 as the start of the limitation period.
71. With respect to the Current Royalty Payment, the Respondent in its most recent interim financial statements prepared by management published on November 30, 2017, states that “the Company estimates its royalty payment to be $71,994” in relation to the royalty owing and payable to Quatsino. Therefore, the Claimant is certainly not statute barred from bringing a claim for the Current Royalty Payment.
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E. Other Legal Issues
(1) Counterclaim
72. The Respondent’s Statement of Defence generally denies the allegations of fact, and seeks “unspecified irreparable damages including lost revenue, reduction of market capitalization which resulted in the loss of its investor base which severely impacted the capacity to finance the company and has summarily put the company at risks of insolvency.”
73. However, the Respondent fails to:
(a) Provide any particulars as to these claims, including the amount of damages;
(b) File an actual counterclaim or claim for set off;
(c) Provide any material facts in support of these claims; or
(d) Provide any supporting documentation for the material facts.
74. For these reasons and other reasons set out above, the assertions made in the Respondent’s Statement of Defence for its damages are dismissed.
(2) The Rule Against Perpetuities
75. As I have found the Deferred Royalty Payments to be due and payable at the expiration of the Agreement, it is not necessary to decide the issue of whether the royalty provisions offend the rule against perpetuities.
(3) The Breach of the Agreement and the Expiration of the Terms of the Agreement
76. Given my reasons above on the interpretation of the Agreement, both these issues are moot, and it is not necessary to discuss whether the sale of the Mine breached or repudiated the Agreement, nor whether the terms of the Agreement continued beyond the term of the Agreement.
(4) Condition Precedent
77. The Respondent appears to suggest in its e-mail dated December 29, 2017, incorporated by reference into its Statement of Defence as Schedule A, that the Production Threshold is
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a condition precedent of the Agreement, and must be met before the provisions relating to the Deferred Royalty Payments are binding on the Respondent.
78. Condition precedents must be worded very specifically in a commercial agreement, and on the face of the Agreement I do not find that there is merit in this position.
79. Consequently, I find it unnecessary to deal with this argument at length.
(5) Assignment of the Obligations Under the Agreement
80. An alternate argument presented was that the obligations were assigned by the Respondent to a third party.
81. The law of assignment is clear that while rights may be assigned without consent of the other parties to an agreement, obligations may only be assigned with the consent of all parties.
82. There appears to be no evidence to suggest that the obligations under the Agreement were assigned to a third party.
83. Consequently, the obligation to pay the Current and Deferred Royalty Payments remains with the Respondent.
III. ORDER
A. Relief Sought
84. For the reasons stated above, I order the following with respect to the relief sought by Claimant:
(a) That Electra owes Quatsino $71,994 in Current Royalty Payments and $420,807 in Deferred Royalty Payments, for a total of $492,801; and
(b) Costs.
85. Any relief sought by the Respondent is dismissed.
B. Costs
86. Section 30.1 of the Agreement provides as follows:
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The defaulting party agrees to pay all costs and expenses (including legal fees on a solicitor and his own client basis) of the other party incurred with respect to any proceedings taken for the purpose of enforcing the rights and remedies of the other party.
87. I will entertain submissions from the parties on the issue of costs.
Dated: April 24, 2018
Place of Arbitration: Vancouver, BC
Geoff Plant, Q.C.
Sole Arbitrator