questions or concerns from Enbridge personnel after the new
system went into operation. Although Siemens’ delivery of the
AMS services would start after the new system went live,
the Subcontract required Siemens to perform some preparatory
work, including having AMS personnel on site before the
“go-live” date.
[66] The trial judge did not accept Sapient’s position that it had
cause to terminate the AMS portion of the Subcontract because of
a “lack of urgency” by Siemens in performing the preparatory
work. He found that as of June 29, 2009, Siemens was not in
breach of its contractual obligations concerning AMS services.
[67] Siemens claimed damages for loss of profits arising from
Sapient’s wrongful termination of the AMS portion of the Subcontract in the amount of $3,575,990. That amount represented
Siemens’ estimate of the total gross profits it would have earned
from the AMS portion of the Subcontract had it remained in
force for the full three-year period following the “go-live” date.
The trial judge accepted the accuracy of Siemens’ estimate.
[68] Sapient contended that s. 18.6 of the Subcontract, entitled
“Limitation of Liability”, precluded Siemens from recovering
damages for lost profits resulting from the termination of the
AMS services. The relevant portions of s. 18.6 provided:
18.6.1 SUBJECT TO SECTION 18.6.2, NOTWITHSTANDING ANYTHING TO THE
CONTRARY HEREIN, EACH OF SUBCONTRACTOR AND SAPIENT WILL BE LIABLE
TO THE OTHER WITH RESECT TO THIS AGREEMENT AND ANY OTHER
OBLIGATIONS RELATED THERETO ONLY FOR DIRECT DAMAGES AND FOR AN
AMOUNT THAT WILL NOT EXCEED, IN THE AGGREGATE.
. . . . .
FOR GREATER CERTAINTY, SUBJECT TO SECTION 18.6.2, NEITHER
SUBCONTRACTOR NOR SAPIENT WILL BE LIABLE TO THE OTHER FOR INDIRECT,
SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES OR FOR LOSS OF PROFITS
(COLLECTIVELY, “EXCLUDED DAMAGES”), EVEN IF THE PARTY HAS BEEN
ADVISED OF THE POSSIBILI TY OF SUCH DAMAGES.
. . . . .
18.6.3 THIS SECTION 18.6 WILL APPLY IRRESPECTIVE OF THE NATURE OF THE
CAUSE OF ACTION, DEMAND OR CLAIM, INCLUDING BUT NOT LIMITED TO,
BREACH OF CONTRACT (INCLUDING FUNDAMENTAL BREACH), NEGLIGENCE,
TORT OR ANY OTHER LEGAL THEORY, AND WILL SURVIVE A FUNDAMENTAL
BREACH OR BREACHES AND/OR FAILURE OF ESSENTIAL PURPOSE OF THIS
AGREEMENT OR OF ANY REMEDY CONTAINED HEREIN.
(Bold in original and italics added)
[69] Sapient argued s. 18.6.1 clearly excluded any liability on
its part for “loss of profits”, with the result that Siemens’ damages for the AMS portion of the Subcontract should be limited
