





CITATION:
Canadian Soccer Association v. Hyundai Auto Canada
          Corp., 2011 ONCA 704



DATE: 20111114



DOCKET: C53447



COURT OF APPEAL FOR ONTARIO



Blair, LaForme J.J.A. and Benotto J. (
ad hoc
)



BETWEEN



Canadian Soccer Association



Respondent



and



Hyundai Auto Canada Corp.



Appellant



Lawrence Theall and Andrea Gorys, for
          the appellant



Pasquale Santini, for the
          respondent



Heard:
October
          12, 2011



On appeal from the judgment of
          Justice Robert J. Smith of the Superior Court of Justice, dated
          February 15, 2011.



ENDORSEMENT



[1]

Hyundai Auto Canada (Hyundai) appeals the summary judgment requiring
    it to pay $175,000 plus interest and costs to the Canadian Soccer Association
    (CSA).

[2]

CSA is a non-profit organization that promotes and develops soccer at
    all levels across the country.  Hyundai is the wholesale distributor of Hyundai
    cars.  In early 2007, Hyundai and CSA signed a two year sponsorship agreement. 
    CSA made two presentations to Hyundai in 2006.  The presentations highlighted
    the opportunity for Hyundai to co-brand with CSAs other sponsors. The most
    important other sponsor was Tide.

[3]

The agreement gave Hyundai the right to sponsor CSA festivals and to use
    the name of the festivals in its promotional material.  In return, Hyundai
    would pay CSA $125,000 for 2007 and $175,000 for 2008.  The agreement
    specifically referred to Tide as a title sponsor and obligated CSA to obtain
    the rights for Hyundai to use Tides trademarks and the name Tide Mini-Soccer
    in its promotions.  The agreement included a clause allowing either party the
    right to terminate the agreement for default of the other provided that the
    party not in default give 90 days notice to the other so that the default
    might be cured.

[4]

Before the second year payment was due, problems arose in the management
    of CSA and this resulted in negative publicity.  Tide withdrew as a title
    sponsor.  Hyundai terminated the agreement and did not give CSA the required 90
    days notice provided for in the agreement in order to remedy the alleged
    breach.

[5]

CSA commenced an action against Hyundai for breach of the sponsorship
    agreement and sought $175,000 representing the 2008 payment.

[6]

The parties agreed that there were no material facts in dispute
    requiring a trial and proceeded to a summary judgement motion.

[7]

The motions judge read the agreement in the context of the underlying presentations
    and found that Hyundai had breached the sponsorship agreement when it
    terminated the contract.  He concluded that Tides continued involvement was
    not a material term of the contract.  He found that Tide could be replaced by
    another sponsor.  He also found that Hyundai should have given 90 days notice
    of termination.

[8]

Hyundai alleges that the ongoing involvement of Tide was a material term
    of the contract, the breach of which could not be cured, thus the notice period
    was irrelevant.  Hyundai argues that the motions judge misapprehended the
    factual matrix of the sponsorship agreement and misinterpreted its terms.  In
    particular, Hyundai argues that paragraph 2(c)(iv) of the agreement was
    misinterpreted.

[9]

Paragraph 2(c)(iv) provides that Hyundai shall have:

The right to use and display the words Canadian
    Soccer Association, and Tide Mini Soccer with presenting partner where
    applicable and the initials CSA

[10]

The appellant argues that the only way to give this clause meaning is by
    interpreting it to mean that Tide will remain the sponsor.  Tide is the
    official name of the Festival.  The motions judge found that the addition of
    the words with presenting partner where applicable indicates that sponsors
    could change.  Hyundai argues that this misapprehends the distinction between
    title sponsor (which meant Tide) and presenting partner (which meant other
    sponsors such as Telus and Adidas).  These terms are not defined in the
    agreement, but are set out in the presentation material.

[11]

Whether or not the motions judge confused the terms title sponsor and
    presenting sponsor is irrelevant.  The agreement, read as a whole discloses an
    intention that the title sponsor, namely Tide, could be changed.

[12]

Paragraph 2(c)(i) of the agreement provides that:

In connection with the
    Festivals, the CSA grants or agrees to provide to [Hyundai]

(i)   Associate
    sponsorship rights of the Festivals and category exclusivity in the automotive
    manufacturer category.  [Hyundai] agrees to use the official name of the
    Festivals
as designated by CSA.
(emphasis added)

[13]

The name that CSA designated was Tide Mini-Soccer.  It is implicit in
    paragraph 2(c)(i) that CSA had the right to designate another title sponsor. 
    There was no warranty clause which guaranteed that Tide would remain a
    sponsor.

[14]

We agree with the motions judge that the continued involvement of Tide
    was not a material term of the contract.  Notice of termination should have
    been given in accordance with the clear words of the contract.

[15]

The appeal is dismissed.  The parties agreed upon the quantum of costs
    which are fixed in the amount of $10,000 and payable to CSA plus disbursements.

R.A.
    Blair J.A.

H.S.
    LaForme J.A.

M.L. Benotto J. (
ad
    hoc
)


