Chemtrade Electrochem Inc v Superior Plus Corporation
Superior Plus Corporation
Chemtrade Electrochem Inc., formerly known as Canexus Corporation
Law Firm / Organization
Osler, Hoskin & Harcourt LLP

Background

  • Transaction:
    • In 2015, Superior agreed to acquire Canexus, subject to regulatory approval under Canadian and U.S. competition laws.
    • The deal failed, and Canexus was later acquired by Chemtrade.
    • The dispute centered on whether Superior owed a $25 million Reverse Termination Fee, triggered if both Competition Act Approval and HSR Approval were not obtained before the Outside Date (June 29, 2016).
  • Trial Decision:
    • The Alberta Court of King’s Bench ruled that Superior owed the fee, finding that HSR Approval was not obtained.

Court of Appeal Decision

  • Key Issues on Appeal:
    1. Did the trial judge misinterpret "HSR Approval"?
    2. Did both Competition Act and HSR Approval need to be obtained to avoid the fee?
  • Findings:
    • The Court found palpable and overriding error in the trial judge’s interpretation of HSR Approval.
    • HSR Approval was obtained on June 28, 2016, when the parties’ timing agreement with the U.S. regulator expired.
    • The trial judge improperly relied on subjective negotiation evidence, contradicting the contract’s plain wording.
    • Because HSR and Competition Act Approval were both obtained, no fee was payable.
  • Outcome:
    • Appeal allowed; trial judgment overturned.
    • Canexus’s claim for the $25 million Reverse Termination Fee was dismissed.
    • No monetary award specified.
Court of Appeal of Alberta
2301-0018AC
Corporate & commercial law
Appellant