Can a defendant set off unliquidated damages which arise out of an independent contract?
Saskatchewan, Canada
The following excerpt is from United Chemicals Ltd. v. Prince Albert Pulp Co. Ltd., 1981 CanLII 2025 (SK QB):
MacKay, J.A., with whom Martin, J.A., concurred, said: None of the unliquidated damages arising herein flow out of or are inseparably connected with the contracts or claims sued on, namely, the notes, but flow out of collateral matter, namely, the securities given as collateral security for the said notes. Brown, C.J.K.B., in Martin v. Haack, 1925 CanLII 237 (SK QB), [1925] 2 W.W.R. 193, made the following statement: The recent decision of our Court of Appeal in Imperial Bank v. Annable Co, (supra) referred to by counsel, simply decides that a defendant cannot set up by way of set off unliquidated damages which arise out of an independent contract.
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