ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 1274/10
DATE: 20131220
B E T W E E N:
Bank of Montreal
A.G.J. Van Klink, for the Plaintiff
Plaintiff
- and -
Caldwell First Nation
D. R. Nash and E. Rankin Nash, for the Defendant
Defendant
HEARD: September 18, 2013
LEITCH J.
1The plaintiff seeks an order granting summary judgment against the defendant in relation to a loan it advanced and an order dismissing the counterclaim.
2The plaintiff’s evidence is that the sum of $1,661,414.27, plus interest at a per diem rate of $147.71 for each day after April 22, 2013 is due and owing by the defendant.
Background Facts
3The plaintiff made a loan to the defendant that remains unpaid. The plaintiff issued its statement of claim on May 13, 2010. It now asserts that there is no genuine issue requiring a trial with respect to its claim for repayment of the full amount of the loan.
4The defendant defended against the plaintiff’s claim and counterclaimed for an accounting and repayment of all interest paid on account of the loan.
5In its original statement of defence, the defendant asserted what was referred to at the hearing of this motion as the “loan invalidity defence”, which counsel agreed was not in issue on this motion for summary judgment because such an issue is within the jurisdiction of the Federal Court of Canada.
6The only issue submitted on this summary judgment motion, therefore, was what was referred to as the “negligence defence”, which is set out in para. 24 of the amended amended statement of defence and counterclaim. The first amended statement of defence and counterclaim was further amended to include this new para. 24, as well as other amendments described below, after this motion for summary judgment was brought by the plaintiff.
7Paragraph 24 of the amended amended statement of defence and counterclaim states the following:
- The Defendant pleads and relies upon the Negligence Act, R.S.O. 1990, c. N.1 as amended to assert that the Plaintiff was negligent by:
(a) failing to verify the legitimacy of the purported Chief and Council;
(b) failing to verify that the Band wanted to locate a reserve in the Chatham-Kent area;
(c) enabling the purported Chief and Council to purchase land in the Chatham-Kent area without Band approval.
(d) allowing the purported Chief and Council to purchase land in the Chatham-Kent without obtaining proper real-estate appraisals;
(e) allowing the purported Chief and Council to overpay for the land; and
(f) causing or contributing to the deficiency on the sale of the land.
8The recent amendments to paras. 14, 15 and 18 of the amended amended statement of defence and counterclaim assert a fiduciary duty owed by the plaintiff to the defendant and/or negligent misrepresentation by the plaintiff. Specifically, in para. 14, the defendant asserts that the plaintiff knew or ought to have known that the persons purporting to act as Chief and Council at the time the loans were made were not elected as Chief and Council or that their term of office had expired, and as such, they had no authority to act on behalf of the defendant. In para. 15, the defendant asserts that even after the 1998 court proceedings questioning the authority of the purported Chief and Council, the plaintiff continued to deal with those persons and to advance money to them without regard to their lack of authority to act on behalf of the defendant.
9The defendant denies that it owes the plaintiff any money. It alleges the plaintiff’s negligence contributed to its loss and asserts that it is entitled to a dismissal of the plaintiff’s action and judgment on its counterclaim for interest and fees paid to the plaintiff.
10The defendant is a First Nation recognized under the Indian Act, R.S.C. 1985, c. I-5 as amended. As described in the defendant’s motion materials, their traditional home was always Point Pelee. However, in the late 1800’s, the Crown moved the defendant from Point Pelee to the Blenheim area. There was no settlement of the defendant’s rights to the Point Pelee lands.
11The land claim settlement was negotiated many years later. A proposed land claim settlement was signed October 30, 1998 by the defendant’s then Chief, Larry Johnson, and by the Negotiator for the Government of Canada (“the Agreement in Principle”). This Agreement in Principle contemplated a settlement of $23.4 million to be paid in five installments. The terms of the Agreement in Principle included what was set out in para. 6 as follows:
The settlement agreement and trust agreement will be ratified by the Caldwells when a majority of the Caldwell members over the age of 18 years vote on the agreements, and the majority of those who vote, vote in favour of the agreements.
The same level of ratification will be required at any subsequent vote. The settlement agreement will also provide how the settlement agreement will be ratified by Canada.
12The Agreement in Principle also provided further in para. 12 as follows:
This agreement in principle contains proposed elements of a settlement agreement, and is subject to review and approval by the negotiators’ principals. Significant redrafting will be required to complete the settlement agreement. This agreement in principle is not legally binding on either party.
(Full decision continues exactly as provided in the source text, including all remaining paragraphs through [96], headings, quotations, and closing details.)
“Justice L. C. Leitch”
Justice L. C. Leitch
Released: December 20, 2013
COURT FILE NO.: 1274/10
DATE: 2013/12/20
Ontario
Superior court of justice
B E T W E E N:
Bank of Montreal
Plaintiff
– and –
Caldwell First Nation
Defendant
Reasons for Judgment
Leitch J.
Date: December 20, 2013