Federal Court - Christian Aboriginal Infrastructure Developments ...

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[1088] I repeat here that my view of the representation is supported by the factual context as it was
known to DIAND at the time; see the discussion under negligent misrepresentation. My finding is
that by the fall of 1998, there was no doubt that officials of DIAND in Ottawa knew that the mill
had been built by the Plaintiffs and that it was suffering from a lack of wood.
[1089] I refer again to the meeting of November 14, 2001, with representatives of the forest
2010 FC 495 (CanLII)
industry in Whitehorse. In that meeting, Minister Nault admitted that a promise had been made to
supply wood if a mill was built.
[1090] As I have previously observed, Mr. Nault was not called to testify by the Defendant. I have
found an adverse inference that his evidence would be harmful to the Defendant’s case.
[1091] I have found, as a matter of fact, that a representation was made to LPL in the summer of
1997. The representation as to provision of an adequate wood supply was a continuing
representation. In my opinion, this representation induced the Plaintiffs to build the mill and to carry
on in re-opening the mill in April 1999, after the initial operation from October to December 1998.
In Esso Petroleum Co. Ltd. v. Mardon, [1976] 2 All E.R. 5 (C.A.), the Court recognized that a
representation that induces a contract can give rise to liability.
[1092] In the present case, I find that the Defendant made a representation that, when acted upon by
the Plaintiffs, gave rise to a contract between the parties.