2042066 Ontario Inc. O/A MSGD Petroleum v. Basant Transport Ltd. and Ranjit Singh Ghuman, 2017 ONSC 2156

COURT FILE NO.: CV-15-5229-00SR DATE: 20170407

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: 2042066 ONTARIO INC. O/A MSGD PETROLEUM, Plaintiff – and – BASANT TRANSPORT LTD. and RANJIT SINGH GHUMAN, Defendants

BEFORE: André J.

COUNSEL: G. Ambwani, for the Plaintiff L. Menon and D. Paul, for the Defendants

HEARD: March 22, 2017, at Brampton

E N D O R S E M E N T

Correction notice

APRIL 25, 2017: The following paragraph replaces the corresponding paragraph in the original endorsement issued on April 7, 2017

[35] Accordingly, judgment will be in favour of MSGD in the amount of $30,500 plus pre and post judgment interest at 10%, in accordance with the agreement. The interest owing from February 1, 2014 to March 31, 2017 is $9,642.65.

[1] The plaintiff, 2042066 Ontario Inc. O/A MSGD Petroleum (“MSGD”), brings a motion for summary judgment for $32,500 plus pre and post judgment interest against the defendants.

BACKGROUND

[2] On July 26, 2013, MSGD agreed to supply petroleum to Basant Transport Ltd. (“Basant”) for resale.

[3] Defendant Ranjit Ghuman was the sole director of Basant and signed the agreement on behalf of Basant.

[4] Mr. Singh Dhillon (“Mr. Dhillon”) signed the agreement on MSGD’s behalf.

[5] Between November 25, 2013 and December 11, 2013, Basant and Mr. Ghuman purchased gas from MSGD for vehicles they operated, in the amount of $37,500. MSGD subsequently issued invoices for the outstanding amount. Except for the sum of $7,000, the defendants have refused to repay MSGD.

[6] MSGD now seeks relief against both Basant and Mr. Ghuman based on a promissory note signed on behalf of Basant and a personal guarantee allegedly signed by Mr. Ghuman. Mr. Ghuman claims that he never signed any guarantee. Mr. Dhillon testified at an examination for discovery that he witnessed Mr. Ghuman sign both the promissory note and the guarantee.

[7] Mr. Dhillon retained a Forensic Document Examiner from Texas, USA, to examine the signatures on the promissory note and on the guarantee. The Examiner concluded that both documents were signed by Mr. Ghuman.

[8] The defendant Basant did not file a statement of defence and has been noted in default.

POSITIONS OF THE PARTIES

MSGD’s Position

[9] MSGD maintains that pursuant to Rule 20 of the Rules of Civil Procedure and the applicable caselaw, there is no genuine issue requiring a trial. The defendants have failed to pay off their debt to MSGD. Mr. Ghuman signed a personal guarantee which was witnessed by Mr. Dhillon. The signature on the guarantee matched that on the promissory note which Mr. Ghuman confirmed that he signed.

Mr. Ghuman’s Position

[10] Mr. Ghuman admits that Basant owes MSGD money but insists that the agreement was between MSGD and Basant. He maintains that he was not a party to this agreement and that he did not sign the guarantee in question. He insists that he only signed a document which Mr. Dhillon gave him but this document was neither a promissory note or a guarantee. Mr. Ghuman deposed that Mr. Dhillon fabricated the promissory note and the guarantee.

ANALYSIS

[11] This motion raises the following issues:

1. Is there a genuine issue requiring a trial?
2. If so, should judgment be granted in favour of the plaintiff?

ISSUE NO. ONE: Is there a genuine issue requiring a trial?

[12] Rule 20.04(2) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 provides that a court should grant summary judgment where there is no genuine issue for trial.

[13] Rule 20.04(2.1) provides that in determining whether there is a genuine issue requiring a trial, the court should consider the evidence, weigh the evidence, evaluate the credibility of a deponent and draw reasonable inferences from the evidence where appropriate.

[14] In Hryniak v. Maudlin, 2014 SCC 7, [2014] 1 S.C.R. 87, the Supreme Court of Canada stated at paras. 49 and 50 that:

[49] There will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on a motion for summary judgment. This will be the case when the process (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts, and (3) is a proportionate, more expeditious and less expensive means to achieve a just result.

[50] These principles are interconnected and all speak to whether summary judgment will provide a fair and just adjudication. When a summary judgment motion allows the judge to find the necessary facts and resolve the dispute, proceeding to trial would generally not be proportionate, timely or cost effective. Similarly, a process that does not give a judge confidence in her conclusions can never be the proportionate way to resolve a dispute. It bears reiterating that the standard for fairness is not whether the procedure is as exhaustive as a trial, but whether it gives the judge confidence that she can find the necessary facts and apply the relevant legal principles so as to resolve the dispute.

[15] The court in Hryniak further noted at para. 66 that:

On a motion for summary judgment under Rule 20.04, the judge should first determine if there is a genuine issue requiring trial based only on the evidence before her, without using the new fact-finding powers. There will be no genuine issue requiring a trial if the summary judgment process provides her with the evidence required to fairly and justly adjudicate the dispute and is a timely, affordable and proportionate procedure, under Rule 20.04(2)(a). If there appears to be a genuine issue requiring a trial, she should then determine if the need for a trial can be avoided by using the new powers under Rules 20.04(2.1) and (2.2). She may, at her discretion, use those powers, provided that their use is not against the interest of justice. Their use will not be against the interest of justice if they will lead to a fair and just result and will serve the goals of timeliness, affordability and proportionality in light of the litigation as a whole.

Application of the Law to the Facts

[16] Is there a genuine issue requiring a trial in this case? Mr. Ghuman’s counsel submits that there is, given that the central issue on this motion revolves around the credibility of Mr. Dhillon and Mr. Ghuman. She relies on the Court of Appeal decision in Baywood Homes Partnership v. Haditaghi, 2014 ONCA 450 for the proposition that summary judgment should not be granted where, as here, there are serious credibility issues. She relies on the court’s admonition at para. 44 that:

Evidence by affidavit, prepared by a party’s legal counsel, which may include voluminous exhibits, can obscure the affiant’s authentic voice. This makes the motion judge’s task of assessing credibility and reliability especially difficult in a summary judgment and mini-trial context.

[17] In my view, Baywood Homes does not stand for the proposition that summary judgment should not be granted where credibility is an important issue. The case is also distinguishable on its facts in that it involved numerous transactions, and defendants. The Court of Appeal held at para. 33 that the motions judge “erred in failing to assess the advisability of the summary judgment process in the context of the litigation as whole”.

[18] No such concerns exist in this motion. The sole issue is whether Mr. Ghuman signed the promissory note. Mr. Ghuman does not dispute that MSGD provided $37,500 worth of fuel to his company. There is no dispute that MSGD was only paid $7,000. What remains to be determined is whether MSGD has proven, on a balance of probabilities, that Mr. Ghuman signed the promissory note.

[19] Mr. Ghuman denied that he did. He insists that the note is a fabrication and that he does not speak or understand English. His counsel also maintains that the expert’s opinion should be given no weight given that it fails to comply with s. 39 of the Rules of Civil Procedure. Mr. Ghuman’s counsel submits, in the alternative, that if the court finds that Mr. Ghuman signed the guarantee, it should conclude that he did so under duress.

[20] Mr. Ghuman’s testimony at the examination for discovery regarding his signing of the promissory note and guarantee is contradictory. He testified that the signatures on the two documents are his, but that these were not the documents he signed. He denied signing any document, but then testified that he only signed one for the company. He testified, under questioning by his counsel at the hearing, that he could not read English but maintained that he only signed one document relating to the company. He did not dispute that he was the sole director of the now defunct company and that he was the one who negotiated the agreement with Mr. Dhillon on behalf of Basant.

[21] Mr. Ghuman’s counsel submits that it makes no sense that Mr. Ghuman would sign a promissory note or any other acknowledgment of Basant’s debt when he knew the defendant corporation was unable to pay off its debt.

[22] In my view, Mr. Ghuman would certainly do so to obtain the fuel required for his company to continue its operations. Furthermore, it is incongruous that Mr. Dhillon would have agreed to provide the fuel to Basant, which was wholly owned by Mr. Ghuman, without obtaining a personal guarantee from him, given that Mr. Dhillon knew Basant was having money troubles and had previously defaulted in payment to MSGD.

[23] There is a discrepancy between Mr. Dhillon’s evidence and the promissory note and with respect to when the impugned guarantee was signed. According to Mr. Dhillon’s affidavit, Mr. Ghuman signed the two documents on the same day, whereas the dates on the promissory note and guarantee are one year apart. Mr. Dhillon however, filed a supplementary affidavit indicating that this was simply a typographical error and both documents should read “2013”, not “2014”.

[24] Mr. Dhillon also testified that Mr. Ghuman signed the guarantee and promissory note on December 19, 2013 but conceded that the actual date was December 20, 2013. In my view, this is a minor discrepancy which does not undermine Mr. Dhillon’s credibility.

Expert Report

[25] The notarized “Letter of Opinion”, dated September 18, 2016, was written by Wendy Carlson, a Court Qualified Forensic Document Examiner from Texas, USA. Ms. Carlson’s Curriculum Vitae indicates that she has examined more than 12,000 documents and has given opinions in approximately 1,000 cases throughout the USA and in 17 countries including Canada. She has also been qualified as an expert in 16 cases.

[26] Ms. Carlson’s report indicates that she examined the signatures on the promissory note and guarantee which are the subject of this motion. She outlined the scientific methodology used in her analysis, which she described as being the “same method reportedly used by the FBI and the U.S. Treasury Department”. Ms. Carlson concluded that:

Based on my scientific examination and agreement of the unique, identifiable handwriting characteristics and the measurable distinctions in the questioned handwriting, it is my professional expert opinion that the same person who wrote the name of Ranjit Singh Ghuman on the known document was also the author of the name of Ranjit Singh Ghuman questioned document. The patterns of handwriting in the known Ranjit Singh Ghuman signatures conform to the patterns of handwriting in the Ranjit Singh Ghuman signature on the questioned document. Therefore, it is my professional expert opinion that Ranjit Singh Ghuman did indeed sign his signature on the questioned document ‘Q1’.

Rule 39

[27] Ms. Menon submits that no weight should be placed on Ms. Carlson’s report because it is not in the form of an affidavit as required by Rule 39 of the Rules.

[28] Rule 39 essentially states that evidence on a motion should be by affidavit and cross-examination on an affidavit. It indicates, under subrule 39.03(1), that evidence may be provided by examination of a witness before the hearing of a pending motion or application. Subrule 39.03(4) provides that evidence may also be provided by the examination of a witness orally at the hearing, with leave of the court. Subrule 39.04 provides that evidence could be provided by the use of an examination for discovery on the hearing of a motion.

[29] I do not share Ms. Menon’s conviction that Ms. Carlson’s Letter of Opinion does not comply with Rule 39. Rule 39(7) provides that opinion evidence provided by an expert witness for the purposes of a motion or application shall include the information listed under subrule 53.03(2.1).

[30] Subrule 53.03(2.1) provides as follows:

(2.1) A report provided for the purposes of subrule (1) or (2) shall contain the following information:

1. The expert’s name, address and area of expertise.
2. The expert’s qualifications and employment and educational experiences in his or her area of expertise.
3. The instructions provided to the expert in relation to the proceeding.
4. The nature of the opinion being sought and each issue in the proceeding to which the opinion relates.
5. The expert’s opinion respecting each issue and, where there is a range of opinions given, a summary of the range and the reasons for the expert’s own opinion within that range.
6. The expert’s reasons for his or her opinion, including, i. a description of the factual assumptions on which the opinion is based, ii. a description of any research conducted by the expert that led him or her to form the opinion, and iii. a list of every document, if any, relied on by the expert in forming the opinion.
7. An acknowledgement of expert’s duty (Form 53) signed by the expert. O. Reg. 438/08, s. 48.

[31] The expert report is in substantial compliance with subrule 53.03(2.1), with the exception of 53.03(2.1)(7). The guarantee and promissory note are appended to the report.

[32] Ms. Carlson’s Letter of Opinion was attached to Mr. Dhillon’s supplementary affidavit dated October 16, 2016. The affidavit was served on Mr. Ghuman’s counsel on October 18, 2016. There was therefore ample time to cross-examine Ms. Carlson on her opinion or for Mr. Ghuman to seek an opinion from another expert about the signatures on the promissory note and guarantee.

[33] In my view, Ms. Carlson’s report, on its own, is not determinative of the issue of whether Mr. Ghuman signed the guarantee in question. However, in combination with Mr. Ghuman’s own evidence and that of Mr. Dhillon, I find as a fact that Mr. Ghuman personally guaranteed the debt to Mr. Dhillon incurred by his company.

[34] Mr. Ghuman maintains that Mr. Dhillon pressured him to sign the guarantee. I find that there is no evidence to support this claim.

[35] Accordingly, judgment will be in favour of MSGD in the amount of $30,500 plus pre and post judgment interest at 10%, in accordance with the agreement. The interest owing from February 1, 2014 to March 31, 2017 is $9,642.65.

COSTS

[36] MSGD seeks costs of $6,469.30 on a partial indemnity basis while Mr. Ghuman seeks costs of $2,000 on a similar basis.

[37] The plaintiff was successful. The issue on this motion however, was not complex although it required the filing of legal briefs and compendiums. It cannot be said that Mr. Ghuman’s conduct unnecessarily prolonged the proceedings. Mr. Ambwani’s hourly rate of $200 is not unreasonable given his 2008 year of call. The amount of preparation time however, appears excessive given the sole issue in this matter.

[38] In my view, costs fixed in the amount of $4,500, are fair and reasonable in this matter.

[39] Mr. Ghuman is ordered to pay costs fixed in the amount of $4,500 inclusive to 2042066 Ontario Inc. within ninety (90) days of today’s date.

André J.

DATE: April 7, 2017 CORRECTED: April 25, 2017

COURT FILE NO.: CV-15-5229-00SR DATE: 20170407 SUPERIOR COURT OF JUSTICE - ONTARIO RE: 2042066 ONTARIO INC. O/A MSGD PETROLEUM – and – BASANT TRANSPORT LTD. and RANJIT SINGH GHUMAN BEFORE: André J. COUNSEL: G. Ambwani, for the Plaintiff L. Menon and D. Paul, for the Defendants ENDORSEMENT André J. DATE: April 7, 2017