Introduction

When a borrower never signs the certificate of acceptance, can you still enforce the lease if they’ve taken the equipment, used it for a season, and made payments? That’s exactly the scenario the Saskatchewan Court of Appeal confronted in Millhouse Farms Inc. v De Lage Landen Financial Services Canada Inc., 2026 SKCA 21 (“Millhouse Farms”). This dispute over a farming equipment lease reaffirmed core principles of contract formation under Saskatchewan Law.

For commercial lenders and equipment lessors, the decision is a useful reminder that acceptance by conduct can complete a contract even when the paperwork is incomplete, and that courts will look at what the parties actually did, not just what they signed, when enforceability is challenged.

This article provides an overview of the factual background, the Court of King’s Bench decision, and the Saskatchewan Court of Appeal’s treatment of contract formation principles, particularly acceptance by conduct and certainty of essential terms.

The facts: Inside the farm equipment deal that sparked the Millhouse appeal

Millhouse operates a large-scale farming business in Saskatchewan. In prior years, it routinely leased farm equipment from Tingley Implements Inc. (“Tingley”), who would then assign the lease to DLL. Millhouse would use the equipment for the growing season and, following harvest, trade in the equipment. Tingley would then lease newer equipment to Millhouse for the following year. This arrangement occurred in both 2016 and 2017.

In 2018, Millhouse entered into a five-year lease agreement with Tingley for three combines and six headers, and Tingley assigned the lease to DLL (the “2018 Lease”). The farm machinery under the 2018 Lease was delivered to Millhouse in July 2018. The 2018 Lease stated, “This Lease shall commence on the Commencement Date (as set out in the Certificate of Acceptance).”[1] However, no certificate of acceptance was ever signed or returned to DLL by Millhouse.

Notwithstanding the absence of a certificate of acceptance, Millhouse:

  • made the first two of five installment payments required under the 2018 Lease; and
  • used the equipment for the 2018 crop.

Unbeknownst to DLL, Millhouse returned the equipment to Tingley in the fall of 2018 after the harvest. Unlike prior years, Tingley declined to enter into a new lease arrangement with Millhouse. Millhouse subsequently defaulted on its payment obligations under the 2018 Lease, which led DLL to commence an action to recover the deficiency.

Saskatchewan Court of King’s Bench judgment

The Court of King’s Bench (the “Court”) rejected Millhouse’s argument that the absence of a certificate of acceptance prevented the lease from commencing.

The Court interpreted the 2018 Lease to mean that:

  • the commencement date was the date of delivery to, and acceptance of, the farm implements by the lessee; and
  • the certificate of acceptance was merely proof that these things had occurred.[2]

The absence of a certificate of acceptance did not mean that the 2018 Lease did not commence. The Court drew support for its conclusion from findings of fact, including that:

  • the 2018 Lease was signed by Millhouse;
  • there was no evidence that the farm equipment was not in good working order or not acceptable to Millhouse when delivered; and
  • Millhouse used the farm equipment for the 2018 harvest.[3]

The Court granted summary judgment against Millhouse for $845,796.72, plus interest accruing from July 27, 2020, to the date of judgment.

Saskatchewan Court of Appeal reasons

On appeal, Millhouse argued that:

  • the Court erred in relying on extrinsic evidence to interpret the 2018 Lease;
  • the 2018 Lease was a standard form contract, such that its interpretation attracted a correctness standard of review; and
  • no contract was formed due to the lack of a signed certificate of acceptance or, alternatively, the contract was void for uncertainty because the commencement date could not be established without the certificate.

DLL argued that:

  • the Court had made no overriding and palpable error; and
  • the lease was valid despite having no certificate of acceptance because Millhouse had taken possession of the farm equipment, used the equipment, and made two of the installment payments under the lease. 

To begin, the Court of Appeal addressed the correct standard of review. It rejected Millhouse’s submission that the 2018 Lease was a standard form contract, holding that while the 2018 Lease contained standardized language, it was informed by a meaningful factual matrix specific to the parties, including the absence of the certificate of acceptance and the negotiated payment schedule.[4] Relying on previous case law, the Court of Appeal reaffirmed that standard form treatment applies only where the contract language is used identically across transactions and no party‑specific surrounding circumstances are relevant to interpretation. Because the interpretive issues turned on facts unique to these parties, the lease was not a standard form contract. Therefore, appellate review was not a correctness standard but was instead limited to palpable and overriding error.[5]

The Court of Appeal then addressed the key issue in the appeal: whether Millhouse had ever “accepted” the lease without signing the certificate of acceptance. The Court of Appeal confirmed that a contract can be validly formed even where a formal “certificate of acceptance” is never signed. The Court of Appeal stated that a binding contract exists where there is an offer, acceptance, intent to create legal relations, and consideration. It emphasized that contract formation is assessed objectively, based on what a reasonable person would understand from the parties’ words and conduct, not solely on missing paperwork.[6]

Specifically, the Court of Appeal rejected Millhouse’s argument that acceptance required a specific document, noting that acceptance can be demonstrated by conduct. Here, Millhouse took delivery of the farm equipment, used it to harvest its crops, and made lease payments. This conduct clearly showed an intention to be bound by the lease terms. The Court of Appeal held that partial performance, especially taking possession and use of leased goods, can amount to acceptance.[7]

The Court of Appeal also disagreed that the lease was void for uncertainty because the commencement date was said to be “set out in the Certificate of Acceptance,” which was never produced, explaining that a contract will not fail simply because a document referenced in it is missing, so long as the agreement provides a workable way to determine the essential terms.[8]

The 2018 Lease did indeed provide a workable way to determine the date of commencement, as commencement was tied to delivery and acceptance of the farm equipment, and this date could be objectively determined from the facts.

Ultimately, the Court of Appeal reaffirmed a practical and commercial approach to contract law. Courts will strive to uphold agreements that parties clearly intended to be binding, particularly where one party has relied on the contract and performed under it.[9]

This decision confirms that, in Saskatchewan, use of equipment, payment, and performance can override the need for formal acceptance documents that may be contemplated in an agreement, and parties cannot avoid contractual obligations by withholding a signature after taking the benefits under a contract.

Conclusion: What does this mean for commercial lenders?

The decision in Millhouse Farms provides important reassurance to commercial lenders operating in Saskatchewan. Most notably, the Court of Appeal confirmed that enforceable lending and leasing arrangements will not fail simply because a contemplated acceptance document was never signed or returned, where the borrower’s conduct objectively demonstrates acceptance. Taken together, execution of the agreement, delivery of the financed goods, use of those goods, and partial payment may be sufficient to establish a binding contract.

That said, Millhouse Farms should not be read as diminishing the importance of sound documentation practices. Ensuring that certificates of acceptance and related schedules are properly executed remains best practice. However, where those documents are missing, this decision confirms that Saskatchewan courts will strive to uphold commercial agreements in a manner that promotes certainty, fairness, and the realities of modern financing transactions.

Whether you are looking to tighten your leasing documentation or respond to a dispute, our Agribusiness and Food Production lawyers and our Commercial Litigation lawyers can help you assess your options and manage your risk. Please reach out to any member of our team.

[1] Millhouse Farms Inc. v De Lage Landen Financial Services Canada Inc., 2026 SKCA 21, at para 20.

[2] Ibid. at para 22.

[3] Ibid. at para 23.

[4] Ibid. at paras 28 to 38.

[5] Ibid. at para 39.

[6] Ibid. at paras 44-45.

[7] Ibid. at paras 58-61.

[8] Ibid. at paras 52-53 and 85.

[9] Ibid. at para 53.