Court orders payment after Zellers left Downtown Sudbury site in 2004
Ontario Superior Court has directed Zellers Inc. and The Oshawa Group Limited to pay legal costs and damages totalling about $1.8 million to the owners of Elm Place Mall in Downtown Sudbury, concluding litigation that began after the retailer vacated the property more than 20 years ago.
"An Ontario Superior court has ordered Zellers Inc. and The Oshawa Group Limited to pay $906,704 in legal costs to the owner of Downtown Sudbury’s Elm Place mall,"
The awards combine a previously determined damages sum with a fresh costs decision. Justice Kathleen Cullin issued the recent decision on costs on July 6. The court had earlier awarded damages and prejudgment interest to Vista Sudbury Hotels Inc. and Vista Sudbury Complex Inc., the companies that operate under the name Rainbow Value Centre.
How the sums break down
| Item | Amount (CAD) |
|---|---|
| Damages | $580,600.63 |
| Prejudgment interest | $352,973.37 |
| Legal costs awarded | $906,704 |
| Total | ~$1,840,278 |
Background and litigation timeline
The dispute stems from Zellers’ decision to close its store in the Rainbow Value Centre on May 15, 2004. Mall owners sued, saying the early exit violated the lease and inflicted financial harm on the centre and its tenants. The case proceeded through a split trial process: one phase to establish liability and a second to quantify losses.
The liability portion was heard in 2017 and initially found the retailer not responsible, but that ruling was overturned on appeal. Proceedings over the amount of damages took place across multiple days between May 2023 and November 2024, including additional written submissions. In January a draft ruling on damages was issued with a subsequent correction in March to fix a calculation affecting losses attributed to Hart Stores.
Practical implications for Sudbury
- The judgment formalizes compensation awarded to the mall owners, but actual recovery may be complicated by corporate insolvency matters surrounding Zellers’ parent company, Hudson’s Bay.
- Downtown stakeholders and tenants affected by the 2004 closure may see limited direct benefit if insolvency prevents payment.
- The ruling closes a long-running legal chapter for the Rainbow Value Centre, potentially clarifying the site’s legal status for future property or redevelopment discussions.
The court documents show a lengthy, multi-year legal fight over commercial lease obligations in Sudbury’s downtown core. While the numerical awards are now set, whether the mall owners will actually receive the full sums depends in part on broader insolvency proceedings involving Hudson’s Bay, which could restrict collection or alter the outcome.
