Deloitte & Touche v. Meramvaliotakis, a.k.a. Takis, c.o.b. as Unit Park [Indexed as: Deloitte & Touche v. Meramvaliotakis]

50 O.R. (3d) 577

[2000] O.J. No. 4211

Docket No. C34026

Court of Appeal for Ontario

Carthy, Goudge and Simmons JJ.A.

November 9, 2000

Negotiable instruments -- Bill of exchange -- Cheque -- Countermanded cheque -- Liability for payment -- No personal liability where cheque indicating that person signing in representative capacity for identified principal -- No personal liability where person signing after trade name indicating that he is signing as agent -- Bills of Exchange Act, R.S.C. 1985, c. B-4, ss. 51(1), 131(1).

Deloitte & Touche ("Deloitte") sued T for $32,303.13 on account of professional services, or, in the alternative, on the basis that he was personally liable on a countermanded cheque payable to Deloitte. Printed on the cheque was the name "Unit Park," which was a trade name for the corporation that was the holder of the bank account on which the cheque was drawn. T signed after the printed Unit Park "per Peter Takis." Deloitte moved for summary judgment. The motion was granted in part. Sachs J. found that whether T had personally engaged Deloitte was an issue requiring trial, but she found that he was personally liable under s. 51(1) or s. 131(1) of the Bills of Exchange Act. He appealed.

Held, the appeal should be allowed.

The description "Unit Park per Peter T" indicated that T signed on behalf of an identified principal, that is, Unit Park. Therefore, it could not be said that on the face of the cheque he signed in his personal capacity rather than in a representative capacity, and he could not be held personally liable under s. 51(1) of the Act, nor was there liability pursuant to s. 131(1), which imposes liability where a person signs a bill in a trade name. While Unit Park was a trade name, T did not sign the cheque in that name, but as an agent for Unit Park.

APPEAL from a summary judgment finding the defendant personally liable for payment of a cheque.

Cases referred to Elliott v. Bax-Ironside, [1925] 2 K.B. 301, 94 L.J.K.B. 807, 133 L.T. 624, 41 T.L.R. 631 (C.A.); Loczka v. Ruthenian Farmers' Co-operative Co., 1922 419 (MB CA), [1922] 2 W.W.R. 782, 68 D.L.R. 535, 32 Man. R. 137 (C.A.) Statutes referred to Bills of Exchange Act, R.S.C. 1985, c. B-4, ss. 51(1), 131(1)

Julian R. Nawrocki for appellant. David A. Broad for respondent.

[1] BY THE COURT: -- In this action, Deloitte & Touche ("Deloitte") sues Peter Takis, claiming, first, that he is personally liable on a cheque that was payable to Deloitte for $32,303.13, but was countermanded; second, that he personally retained Deloitte and is, therefore, liable for the balance of their bill for professional advice, in excess of the cheque.

[2] Sachs J. granted summary judgment to Deloitte on the cheque, but found that whether Mr. Takis personally engaged Deloitte or otherwise assumed liability for their services was an issue requiring a trial.

[3] Mr. Takis appeals from the summary judgment granted against him on the cheque. Deloitte cross-appeals from the order that there be no costs of the motion for summary judgment, given the divided success.

[4] The cheque was a partial payment of the balance owing on Deloitte's account for professional advice. It was payable to Deloitte. The name "Unit Park" followed by the word "per" were printed on the cheque, as were the bank branch and the account number. Mr. Takis signed after the word "per". The cheque was subsequently countermanded. Unit Park is a registered trade name for 15 related corporations, one of which is the holder of the bank account on which the cheque was drawn.

[5] In finding Mr. Takis personally liable on the cheque, Sachs J. relied on ss. 51(1) and 131(1) of the Bills of Exchange Act, R.S.C. 1985, c. B-4. They read as follows:

51(1) Where a person signs a bill as drawer, endorser or acceptor and adds words to his signature indicating that he has signed for or on behalf of a principal, or in a representative character, he is not personally liable thereon, but the mere addition to his signature of words describing him as an agent, or as filling a representative character, does not exempt him from personal liability.

131(1) Where a person signs a bill in a trade-name or assumed name, he is liable thereon as if he had signed it in his own name.

[6] With respect, we cannot find that either section makes Mr. Takis personally liable on the cheque.

[7] In our view, the description "Unit Park per Peter Takis" indicates that Mr. Takis has signed on behalf of the principal Unit Park. The words "Unit Park per" do more than describe Mr. Takis as an agent. They also identify his purported principal. Hence, it cannot be said that on the face of the cheque Mr. Takis signed in his personal capacity rather than in a representative capacity. He cannot, therefore, be held personally liable under s. 51(1) of the Bills of Exchange Act. Rather, the words here indicate that Mr. Takis signed as a representative of a principal: see Elliott v. Bax-Ironside, [1925] 2 K.B. 301, 94 L.J.K.B. 807 (C.A.); Loczka v. Ruthenian Farmers' Co-operative Co., 1922 419 (MB CA), [1922] 2 W.W.R. 782, 68 D.L.R. 535 (Man. C.A.).

[8] Nor was there anything in the record before the motions judge that at this stage would impose personal liability on Mr. Takis pursuant to s. 131(1) of that Act. While Unit Park is a trade name, Mr. Takis did not sign the cheque in that name, but as agent for Unit Park.

[9] It must be remembered that this is a claim raised by the payee of the cheque, not by a holder in due course. Whether apart from these two sections of the Bills of Exchange Act there is a basis for finding Mr. Takis personally liable to Deloitte is something which must await the outcome of a trial. It is sufficient at this stage to find that neither s. 51(1) nor s. 131(1) of the Bills of Exchange Act renders Mr. Takis personally liable on this cheque based on the evidentiary record at this stage.

[10] The appeal must be allowed and the motion for summary judgment dismissed. The appellant is entitled to its costs of the motion and the appeal on a party and party basis.

[11] In the circumstances, there is no need to deal with the cross-appeal and it is dismissed without costs.

Appeal allowed.