Chand Morningside Plaza Inc. v. Healthy Lifestyle Medical Group Inc., 2017 ONSC 19

Court File and Parties

Court File No.: CV-11-439398 Date: 20170103 Superior Court of Justice - Ontario

RE: Chand Morningside Plaza Inc. and Joshi Group of Companies Ltd., Plaintiff AND: Healthy Lifestyle Medical Group Inc., Rochak Badhwar, Gore Doctors Medical Inc., Ashok Badhwar, Usha Badhwar, Aash Karia, Bindaas Capital Inc., and Marvin Talsky, Defendants

BEFORE: Pollak J.

COUNSEL: Jonathan Rosenstein, for the Plaintiffs Jeb Assaf, for the Defendants

HEARD: October 6, 2016

Endorsement

[1] The Plaintiffs move for summary judgment against two of the Defendants, Ashok Badhwar and Usha Badhwar (collectively the "Badhwars") on their written guarantee (the "Guarantee") and for default judgment against the Defendant Rochak Badhwar (''Rochak").

[2] The Defendant Rochak did not appear and has filed no materials.

[3] The Badhwars are Rochak Badhwar's parents. They signed the Guarantee which is secured by a mortgage (the "Mortgage") on their house.

[4] The Plaintiffs ask for: (a) default judgment against Rochak in the amount of $938,919.12; (b) summary judgment against the Badhwars in the amount of $938,919.12; (c) an order granting them possession of the Badhwars' house.

[5] The balance owing on the guaranteed debt is $938,919.12, inclusive of interest through September 26, 2016. The debt is owing by Rochak.

[6] On this motion, the Badhwars rely on the defence of non est factum: they did not know what they were signing and claim that there was no consideration for the guarantee because the guarantee was signed after the loan monies were advanced. Further, it is argued that they did not get "independent legal consultation".

[7] Badhwar has however conceded on cross-examination that there were no representations made with respect to the nature of the document they signed.

[8] As Rochak's defenses have been struck, he is deemed to have admitted the allegations in the Statement of Claim regarding the unpaid debt owed by him that he personally guaranteed.

[9] I find that the Plaintiffs are entitled to judgment against Rochak on his Guarantee.

[10] I agree with the submissions of the Plaintiff that the defence of non est factum requires the Badhwars to show that: (a) they were mistaken as to its nature and character of the guarantee; (b) the mistake is as a result of misrepresentation; and (c) they have not been careless.

[11] I agree that they cannot meet the test as there was no misrepresentation. On cross-examination it was admitted that no representation was made to them regarding the character of the documents that their son was asking them to sign.

[12] The Mortgage was given as security on the Guarantee. The terms of the Mortgage permit enforcement upon default. There has been a default.

[13] The Badhwars did not plead the defence of "no consideration because the Guarantee was signed after the loan monies were advanced" in their defence. They specifically plead that there was no consideration because they personally did not benefit from the Guarantee. They did not ask to amend the Statement of Defence at the hearing of this motion to include the above-noted defence. The Plaintiffs submit that they would have adduced further evidence had such a pleading been made in the Statement of Defence and that it would therefore be prejudicial and improper for this Court to consider the defence of no consideration because the Guarantee was signed after the loan monies were advanced. I agree that in the absence of a motion to amend pleadings, which the Defendant could have made at the hearing of this motion but did not, the Court has no option but to find that this defence cannot be considered on this motion even though had it been properly pleaded, it could have potentially established a genuine issue requiring a trial on this motion.

[14] Following the direction of the Supreme Court of Canada in the case of Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, on a motion for summary judgment I must ask myself: just on the basis of the evidentiary record alone, are there genuine issues that require a trial? I must also ask myself: does the evidentiary record in front of me provide me with the evidence I need to "fairly and justly adjudicate the dispute"?

[15] In my view, the answers to the questions above are as follows: there is no evidence that supports a finding of a genuine issue requiring a trial. The evidentiary record in front of me does provide me with sufficient evidence to fairly and justly adjudicate the dispute. The Plaintiffs have met their burden of proving they are entitled to the following relief: (i) judgment for the amount of $938,919.12 against the Badhwars and/or a default judgment against Rochak in the amount of $938,919.12; (ii) the right to enforce the mortgage against 3 Collanus Court, Etobicoke, Ontario, in accordance with the terms of the mortgage.

[16] On the basis of the materials filed and the submissions made, the Plaintiffs are entitled to judgment against the Badhwars on their guarantee, in the amount of the Healthy Lifestyle Medical Group Inc.'s debt.

[17] The motion for summary judgment granting the relief against Rochak and against the Badhwars, as set out in paragraph 15, is therefore granted.

[18] If the parties are unable to agree on costs, they may make brief written submissions to me no longer than three pages in length. The Plaintiffs' submissions are to be delivered by 12:00 p.m. on January 10, 2017, and the Defendants' submissions are to be delivered by 12:00 p.m. on January 17, 2017. Any reply submissions are to be delivered by 12:00 p.m. on January 24, 2017.

Date: January 3, 2017 Pollak J.