Logix Data Products Inc. v. Ace Rivet and Fastener Inc., 2005 CanLII 1496 (ON S.C.)

8 Feb ’05

It’s not often we see software cases in Canadian courts.  Issues arising out of software disputes are litigated much more often in the US.

In this case, Ace Rivet needed an upgrade to an inventory management system.  It solicited proposals, chose an AccPac app marketed by Logix, and then discovered on the install that the app would not meet its needs unless additional costly modules were purchased.  Ace refused to pay, Logix sued, and Ace counterclaimed.  The case is really a factual dispute that turned on oral evidence by both parties – there seems to have been no written license / services agreement – and boiled down to the judge’s preference for the evidence given by Ace to the effect that Logix personnel made certain untrue oral representations about the capability of the app without the additional modules.

A case that could have gone either way, and a dispute that could have been avoided with simple contractual precautions.

One final observation – the trial took two days.  Each side was represented by counsel, yet the plaintiff’s claim was for only $13K and the counterclaim under $4K – the time each was willing to invest to "win" perhaps as good an indication as any of the consequences of the breakdown of the relationship.  And of course, there is this, referring to the defendant’s reaction when she learned that the app would not perform the three functions of most importance to her:

It is unfortunate that no one took notes of the meetings or the calls, however, the memos of April 24th and June 19th indicate that Katrina Litchfield is asking about the three areas in addition to other areas that were of concern to her. Once she meets with the trainer and it is clear that the program could not perform those functions, to use her words she "lost it". That reaction in my view was not unreasonable …

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