The appellant, an investment advisor, appealed an order dismissing his motion to set aside a default judgment of over $100,000 granted in favour of the respondents (his former parents-in-law).
The respondents had co-signed a loan and pledged securities for the appellant.
When the loan went into default, the respondents paid $13,877.36 to protect their securities and sued the appellant for damages, breach of fiduciary duty, and fraud.
The Court of Appeal allowed the appeal, finding the motion judge erred in concluding the appellant had no arguable defence, as the default judgment awarded damages the respondents had not actually suffered and granted declaratory relief not sought in the Statement of Claim.
The default judgment was set aside and substituted with a judgment for the $13,877.36 actually paid by the respondents.