The plaintiff bank brought a motion for summary judgment against a corporate borrower and its guarantors after the borrower defaulted on a loan and was placed into receivership.
The defendants argued they were induced to sign the guarantees by misrepresentations from their lawyer, who also acted for the bank, regarding the priority of the bank's security interest.
Using enhanced fact-finding powers to hear oral evidence, the court found the defendants' evidence lacked credibility and that no misrepresentations were made.
The court held the guarantees were absolute and unconditional, and granted summary judgment to the plaintiff for the outstanding loan amount.
