"Gross Over Or Under Value" Not Grounds For Overturning Share Valuation

There are few circumstances in which courts will allow obvious errors committed by a decision-maker to go uncorrected. However, one situation in which courts will not intervene to correct a mistake is the valuation of a corporation's shares when the parties have agreed to refer the decision to a valuator.

In a recent decision, Saputo Inc. et al v. Dare Holdings Ltd. et al¹, the Superior Court of Justice of Ontario confirmed that the court will only intervene to correct mistakes by a valuator that result in the valuation being in discordance with the provisions set out in the Unanimous Shareholders Agreement (USA).

Unanimous Shareholders Agreement provisions

In Saputo, the applicants sought to set aside a valuation of certain shares of Dare Holdings Limited conducted pursuant to a USA as part of an acquisition of the applicants' minority interests in Dare.