Keephills Aggregate Company Limited v. Riverview Properties Inc., 2011 ABCA 101

This decision of the Alberta Court of Appeal provides an example of a court implying terms into a contract in order to reflect relevant business practices and business efficacy.

Keephills Aggregate Company Limited (Keephills) and Riverview Properties Inc. (Riverview) entered into a gravel lease for a term of two years. Pursuant to the lease, Keephills was granted the exclusive right to excavate, crush, stockpile and remove gravel from a parcel of land owned by Riverview. Keephills agreed to a payment provision of "$1.75/tonne of gravel removed from the Deposit Area with minimum monthly payments of $14,583.33 on the first of each month." The minimum monthly payment amount was arrived at by multiplying the $1.75/tonne by 200,000 tonnes of gravel and dividing it by the 24 month term of the contract. The parties expected there was a minimum of 200,000 tonnes of gravel available, and in fact, both parties believed that there would be far in excess of that amount.