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Sep
10
2015

Contempt (2)

Posted in Collections

An examination in aid of execution is a wonderful tool for a creditor to determine what assets a debtor may have and whether the debtor has improperly transferred assets. It is a simple process: the creditor serves a notice of examination, the debtor appears at the specified time and date and brings all relevant documents, the debtor truthfully answers all questions asked at the examination, and if the debtor does not have the answer or documents – because a debtor cannot anticipate everything – the debtor quickly honours his undertakings to supply the answers and the documents. Stop laughing.

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Sep
10
2015

Parol Evidence

Posted in Collections

We have said it before, and will say it again – some debtors will do or say just about anything to avoid payment of their debts. Take this defence: The document I signed does not demonstrate the true state of the deal between creditor and me because the creditor promised me that (fill in the blanks). The action between Toronto-Dominion Bank v. 1745361 Ontario Corp and Carter, a 2013 Ontario Superior Court of Justice decision, contains an example of this defence.

 

Loan

The main principal of a corporation applied for a small business loan. She was refused; the bank felt that she did not have the financial backing or appropriate experience for her new venture. The principal therefore persuaded the defendant to join her in the venture and, based on both of their guarantees, the bank agreed to lend $250,000 to the corporation. In keeping with the nature of a small business loan, the personal guarantees were limited to 25% of the actual loan.

The corporation defaulted and the bank commenced an action.

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Sep
10
2015

The Consequences of One Second on the Clock, Judicial Embarrassment, and Mootness

Posted in Construction

Courts do not like to decide matters raising abstract questions; they want their decisions to decide real disputes. When a decision is irrelevant to the real dispute because of subsequent events, the matter is said to be moot. For example, consider an action brought for an injunction to restrain a landowner from tearing down a building, but, before the action is heard, the homeowner has already demolished the building. While the decision might be interesting, it is irrelevant. The building is no longer standing. Now consider what happens when the law of tender deals with the concept of mootness. Such was the case in Yukon v. P.S. Sidhu Trucking Ltd., a 2015 decision of the Yukon Territory Court of Appeal. As an aside, this court is comprised of British Columbia Court of Appeal judges.

mootness

Timing

 Tender submissions were called to be “received up to and including 4:00 p.m.” The contractor submitted his tender at 3:59 p.m. He then had misgivings and felt he might have made an arithmetical error. On a Yukon employee’s alleged advice that he had sufficient time to take back the tender and re-submit it with a compliant timestamp of 4:00 p.m., he withdrew it, reviewed it, realised it was fine, and resubmitted it. The employee time-stamped the re-submitted tender at 4:00 p.m. The contractor’s bid was low. Jubilation reigned in the contractor’s camp.

The jubilation was short-lived. The second low tenderer claimed that the contractor’s tender was submitted too late; it brought an application for a declaration that the contractor’s bid was therefore non-compliant. The contractor and Yukon consented to the dispute being resolved by way of the proceedings because the project was for a replacement bridge and construction had to start almost immediately.

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Sep
10
2015

Costs

Saleh v. Nebel, 2015 ONSC 3680

Costs normally follow the event (i.e. the loser pays them to the winner, subject to offers to settle and different scales of the awards). However, costs are discretionary and the court can depart from basic principles if there are good reasons to do so, such as the misconduct of a party, miscarriage in procedure, or oppressive or vexations conduct of proceedings.

In this case, the plaintiff was claiming damages for personal injury. Liability was acknowledged and a trial was held on damages. The jury, after a 10-day trial, awarded $30,000; the judge held that that the injuries did not meet threshold and dismissed the action.

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