Written By Munaf Mohamed KC, Ciara Mackey and Douglas Fenton
On July 2, 2025, the Court of Appeal of Alberta set aside a C$228 million judgment against Canadian Pacific Kansas City Limited (CPKC) and the Province of Alberta (the Province), arising from a failed real estate transaction.
The judgment relates to a conditional deal between Remington Development Corporation (Remington) and CPKC in 2002 whereby CPKC would sell Remington certain lands in downtown Calgary provided those lands were surplus to its railway operating requirements. In 2007, CPKC sold a parcel of land that was still used as an active railyard to the Province in a deal that allowed rail operations to continue. Remington sued CPKC and the Province, alleging breach of contract and inducing breach of contract, claiming damages in excess of C$300 million for lost potential commercial development of the lands in "the most profitable way possible", a vision it dubbed for trial as "Rail Town". In two sequential trial decisions, the trial judge found CPKC and the Province liable for all lost profits on the hypothetical and monumental development project, totaling C$165 million before interest and costs.
The Court of Appeal concluded that, in finding CPKC liable for breach of contract, the trial judge approached the contract piecemeal and improperly rewrote the parties' bargain. Noting that the award was "extraordinary" and "seemingly unprecedented", the Court also set aside the assessment of damages. The decision stands as a significant statement of the law on proper contractual interpretation and the assessment of damages for breach of contract, including issues of remoteness and methodology in the context of commercial real estate deals. The two Justice majority ordered a new trial on liability and damages. In concurring and dissenting reasons, Wakeling JA would have dismissed Remington's claims against CPKC and the Province entirely. The Court of Appeal's reasons span over 100 pages.
Bennett Jones assumed representation of CPKC following an initial trial decision issued in 2022. After assuming carriage, Bennett Jones completed the trial and obtained a stay of the judgment pending appeal, before successfully prosecuting the appeal.
CPKC was represented by Munaf Mohamed, KC, Ciara Mackey, and Douglas Fenton, as well as other lawyers from Bennett Jones' various offices.
The full decision is available here.
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Bennett Jones