The plaintiff Force 10 Capital Management Inc. loaned $150,000 to a company called Miser Lighting Inc. The debt was evidenced by promissory notes signed by the defendants Jake Bulk and Paul Wemple in the amount of $150,000. Bulk and Wemple were officers and directors of Miser Lighting, and of another company that was the owner of Miser.
When the plaintiff brought a motion for summary judgement under the promissory notes, Bulk and Wemple alleged that there had been concealment by the plaintiff as to charges and encumbrances registered against two properties that were involved in the transaction. They claimed that the guarantees and the promissory notes they had provided should be released due to material concealment.
Justice Matheson reviewed the test for summary judgment under Rule 20, noting that although formerly a judgment could be granted on motion only where there is “no genuine issue for trial”, now the standard is “no genuine issue requiring a trial”. The judge reviewed authorities suggesting that this change expanded the powers of the motions judge to make evidentiary determinations, and to conduct a more meaningful review of the paper record.
The judge also noted that both the defendants were experienced businessman. They had access to legal advice at the time they signed the notes, and the encumbrances that they claimed were concealed from them were publicly registered documents which could be verified by means of a title search.
There was no evidence put forward by the defendants to show that the plaintiff had concealed anything material to the transaction, and the judge concluded that the plaintiff had established that there was no genuine issue requiring trial.
Link: Force 10 Capital Management Inc. v. Bulk, CanLII – 2011 ONSC 4659 (CanLII)
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