COURT FILE NO.: CV-18-3354-00
DATE: 2020 11 26
ONTARIO SUPERIOR COURT OF JUSTICE
B E T W E E N:
DIDAR SINGH
R. S. Mann, for the Plaintiff
Plaintiff
- and -
KIRANDEEP KAUR SANDHU and
Kirandeep Kaur Sandhu, Self-
G.K. LOGISTICS INC.
Represented
G. Gill, for the defendant, G.K.
Logistics Inc., with leave of the court,
Defendants
HEARD: November 16 and 17, 2020
REASONS FOR JUDGMENT
Trimble J.
The Action
[1] The plaintiff claims from the defendants repayment of a loan totaling
$43,411.73, advanced in the following instalments:
(a) $10,000 paid to TPine Leasing Capital Corporation by credit card, on the plaintiff’s behalf, on 28 March 2017;
(b) $10,000 paid to TPine Leasing Capital Corporation by a second credit card, on the plaintiff’s behalf, on 28 March 2017;
(c) $5,000 paid to TPine Leasing Capital Corporation by a second credit card, on the plaintiff’s behalf, on 28 March 2017;
(d) $9,459 paid to TPine Leasing Capital Corporation, by a bank draft, on the plaintiff’s behalf on 25 April 2017;
(e) cash or personal check amounts paid by the plaintiff to the defendants of $2085, $1104.60, $390, and $100, advanced in April and May 2017.
[2] The plaintiff also seeks interest on the total loan amount effective June 1, 2018 at 5%.
Positions of The Parties
The Plaintiff
[3] Mr. Singh was Ms. Sandhu’s employer. Ms. Sandhu was a foreign student, working part-time as permitted by her study visa status. Her sister-in-law had worked for Mr. Singh for some time.
[4] In March 2017, Ms. Sandhu asked Mr. Singh to lend her money so that she could lease a truck to start a trucking business. He agreed to lend her the down payment, interest free for one year, with interest after that time on any outstanding balance. She agreed that she would continue to work for him a full- time basis once she received her work permit permitting her to work full time so she could pay back the loan.
[5] Mr. Singh and Mr. Gill (Ms. Sandhu’s fiancé whom Mr. Singh had only met when Mr. Gill came to pick up Ms. Sandhu) attended at TPine Leasing Capital Corporation’s office on 28 March 2017 where Mr. Singh made a total deposit of
$25,000, paid from three separate credit cards. Mr. Singh made these three payments using TPine’s credit card terminal. The payments were made on behalf of Ms. Sandhu.
[6] Mr. Singh returned to TPine’s address on 27 April 2017, this time with Ms.
Sandhu, where he made a payment on behalf of Ms. Sandhu to TPine of $9,459 by way of a TD bank draft made payable to TPine. On that day or a day or two afterwards, he first heard of G.K. Logistics Inc. involvement. He was also told by TPine that they required him to be a personal guarantor because Ms. Sandhu was a foreign national and was not married to Mr. Gill who would be driving the truck. Both Mr. Gill and Mr. Singh provided personal guarantees with respect to the lease.
[7] Mr. Singh says that in late April and May 2017, he advanced payments of
$2,085, $1,104.60, $390, and $100, either by cash or by personal check, to Ms. Sandhu to assist her in making the first two lease payments on the truck because Mr. Gill had not yet begun to generate income from his use of the truck.
[8] Mr. Singh says, and the defendants agree, that no one made any payments to Mr. Singh on account of the money he advanced.
The Defendants
[9] The defendants argue that Mr. Singh gave them the money as a gift. There was no loan.
[10] Further, they argue that Mr. Singh approached Mr. Gill and told him that he should obtain a new truck and start a trucking business. Mr. Singh volunteered to assist the couple financially. At all times Mr. Singh was aware that G.K. Logistics would be leasing the vehicle.
[11] The defendants acknowledge that Mr. Singh advanced money totaling
$34,459. They deny that the payments of $2,085, $1,104.60, $390 and $100 were advanced by Mr. Singh.
Result
[12] For the reasons that follow, I grant judgement for the plaintiff against Ms.
Sandhu.
Credibility
[13] Much of the case turns on findings of fact made based on conflicting oral evidence. Therefore, the witness' credibility is key. All parties had issues with their credibility.
The Law on Credibility
[14] An assessment of any witness' credibility involves an assessment of: a) the witness' honesty (his belief in the truth of what he is saying), and b) the reliability of the witness' evidence (his ability to remember and testify accurately). In addressing the credibility of each of the witnesses, I directed myself to the following considerations:
A. While how a witness gives evidence is relevant, findings of credibility should not be made on the witness's demeanour alone. There may be cultural, social, ethnic, or other reasons why a specific witness may have difficulty testifying. There are too many factors that affect a witness' ability to testify comfortably to make demeanour the sole or most important factor in determining credibility.
B. Does the evidence make sense in light of the preponderance of probabilities which a practical and informed person would find reasonable given the particular place and condition?: Faryna v. Chorny, 1951 252 (BC CA), [1951] B.C.J. No. 152, [1952] 2 D.L.R. 354 (C.A.), at para. 11.
C. Does the evidence have an internal consistency and logical flow? R. v. C.H., 1999 18939 (NL CA), [1999] N.J. No. 273 182 Nfld. & P.E.I.R. 32 (C.A.).
D. Is the evidence consistent with the witness' other statements? How significant are the differences and are they adequately explained?: R. v. Dinardo, 2008 SCC 24, [2008] 1 S.C.R. 788.
E. Is there independent confirming or contradicting evidence?: R. v. Khan, 1990 77 (SCC), [1990] 2 S.C.R. 531.
F. Does the witness have a motivation to lie or exaggerate? The witness' motivation to lie must be greater than his or her interest to win or lose the case: R. v. S.D., 2007 ONCA 243, 218 C.C.C. (3d) 323.
[15] This case is a classic “he said – he and she said” dispute. I apply the foregoing factors to each of the witnesses at this trial and explain why I made the findings of fact I have made where evidence conflicts.
Mr. Singh
[16] Mr. Singh gave his evidence in a straightforward manner, without hesitation or prevarication. Generally, his evidence was consistent with the documents provided.
[17] The main issue with Mr. Singh’ is credibility arises from the fact that he loaned over $40,000 to a part time student employee, in Canada on a student visa, without a written contract, and without any security.
[18] Mr. Singh is a sophisticated businessman. He owns and operates three corporations: a temporary employee placement business, a dry-cleaning business, and an unspecified manufacturing business. He has a number of personal and business bank accounts, and a number of personal and business credit cards that he uses to conduct his business.
[19] It reflects poorly on Mr. Singh’s credibility that he would lend a significant amount of money without documenting it.
[20] Mr. Singh explains the lack of documentation on the basis that Ms.
Sandhu’s sister-in-law had worked for him for a number of years. Ms. Sandhu was also an employee. She promised to continue to work for Mr. Singh once she was entitled to work on a full-time basis. In light of his employment relationship with Ms. Sandhu and her sister in law, and in light of Ms. Sandhu’ has promised to continue to work for him, he felt reassured that she would be able to repay the loan.
Mr. Gill
[21] Mr. Gill gave an extensive opening statement with respect to how the payment came about, to whom it was made, and the circumstances in which the payment occurred. Unfortunately, most of this did not find its way into the evidence.
[22] What evidence was introduced by the defendants came, predominately, through Mr. Gill. He and Ms. Sandhu spoke through him, as if with one voice.
[23] Both Mr. Gill and Ms. Sandhu are laypeople. Ms. Sandhu represented herself and I gave leave to Mr. Gill to represent his corporation, G.K. Logistics. Therefore, I have approached their evidence with a certain leeway, recognizing their status as laypeople.
[24] Initially, Mr. Gill did not want to give evidence. After some discussion about those documents in Exhibit 1 which not had not been properly proved during the plaintiff’s case, and after agreement of the parties that those documents could all be taken as if properly proved (thereby making every document in Exhibit 1 admissible for the truth of their contents), Mr. Gill gave evidence with respect to tabs eight through 11 of Exhibit 1. He said that all of these documents show that the lease of the truck was by G.K. Logistics, and not by he or Ms. Sandhu.
[25] Generally, Mr. Gill seemed forthright. He freely admitted that he accepted delivery of the truck on behalf of G.K. Logistics and operated the truck until about a year ago when he returned it to TPine. He accepted that in G.K.’s tax return for the March 2018 – 2019 year, the truck earned $130,000 in gross revenue. He did say that the truck was idle for large periods of time in 2017 because he had to go to India for five months because of family matters. He readily conceded that at the time that the invoice was given by TPine for the truck on 17 March 2017, G.K. did not exist. It would not t come into existence until 28 March 2017.
[26] What Mr. Gill did not testify about reflects poorly on his credibility. He did not give evidence about the financial arrangements regarding the money Mr. Singh paid. He did not confirm or deny his Ms. Sandhu’s evidence that it the money was a gift and was arranged between Mr. Singh and Mr. Gill directly. He does not say that it was he who requested financing or that it was Singh who suggested that Mr. Gill by the truck. He did not say anything that contradicted Mr. Singh’s evidence
that Mr. Singh first heard about G.K. Logistics at the time he attended, in April, to sign the guarantee.
[27] To the extent that Mr. Gill did not offer evidence contrary to that of Mr.
Singh or in support of Ms. Sandhu’s, as between Mr. Gill and Mr. Singh, I prefer the evidence of Mr. Singh.
Ms. Sandhu
[28] I put a little weight in Ms. Sandhu’s evidence. I do not find her credible.
[29] In her brief evidence in chief, Ms. Sandhu repeatedly said that she knew nothing about the arrangements with respect to the money. That was arranged solely between Mr. Gill and Mr. Singh. She said she had nothing to do with the loan. She took no money from Mr. Singh.
[30] Ms. Sandhu also said that Mr. Singh offered Mr. Gill the financing in order to request sexual favours from her. He only demanded repayment of the “loan” when she spurned her offers. I make no comment on whether Mr. Singh sexually harassed Ms. Sandhu. That question is the subject of a Human Rights Tribunal proceeding. I refer to this question only as Ms. Sandhu offered it as an explanation as to why Mr. Singh claimed that his gift was, in fact, a loan. It makes no sense that Mr. Singh would not make Ms. Sandhu aware of his largess, so that he could demand sexual favours as some sort of quid pro quo.
[31] The only time that Ms. Sandhu gave evidence of any specificity was when she admitted that she had been working at Mr. Singh’s dry-cleaning business as an international student, working part-time. Mr. Gill was her fiancé. She said it was Mr. Singh that suggested that Mr. Gill by the truck. She said that Mr. Singh and Mr. Gill became friendly, during the time that she worked for Mr. Singh, Inc. which included having meals together.
[32] Ms. Sandhu’s professed ignorance of the arrangements regarding the money and her evidence concerning why it was paid further hurts her credibility. If she was as ignorant of the financial arrangements as she says (because arrangements were all between Mr. Singh and Mr. Gill), her evidence concerning the financial arrangements, as limited as it was, is hearsay. If her professed ignorance was a ruse to avoid giving evidence, she was not being truthful.
[33] In cross-examination, Ms. Sandhu vacillated between her broad and categorical denial of any knowledge or any involvement, and very specific knowledge. For example, she professed no knowledge about the incorporation of
G.K. Logistics or its operation. When confronted with the fact that she was the incorporating director of G.K., she said that at the time G.K. Logistics was incorporated, her husband was out of the country and therefore, she was put on as a director of the Corporation until Mr. Gill returned to the country.
[34] In fact, Mr. Gill was not out of the country when Ms. Sandhu incorporated G.K.. Mr. Gill and Mr. Singh attended TPine to make the $25,000 down payment.
[35] In addition, I do not accept Ms. Sandhu’s broad denial of any involvement in, or knowledge of the transactions leading up to the lease of the truck. Other evidence indicates that she knew more than she let on. I say this for the following reasons:
(a) she admitted that she signed a personal guarantee for the lease obligation. She said that both Mr. Gill and Mr. Singh told her she had to do this.
(b) She was present with Mr. Singh in April when he paid over the TD bank draft for $9,459 and signed his personal guarantee.
(c) She knew that her husband took possession of and drove the truck.
(d) She opened a business account for the trucking business on 29 March 17. She explained that she did this because Mr. Singh told her to because her husband, Mr. Gill was out of the country. She also said that she did not remember opening the account. Mr. Gill was in the country on 27 March. There is no evidence when he left for India.
(e) She was still the officer and director to whom G.K.’s accountant was writing and who was listed as the officer certifying the T2 return to Revenue Canada for the March 2018-2019 fiscal year.
(f) Most incredibly, she testified that she did not know whether her husband still had the truck.
[36] Ms. Sandhu was cross-examined with respect to Exhibit 1, T 13, a handwritten list of numbers and totals. She admits that all of the writing on that
page with the exception of “42,650” is her handwriting. She says she was merely writing down numbers at the direction of Mr. Singh for a number of corporations on different pages of the notebook. She did not know the purpose of the numbers. She did not realize the numbers at tab 13 pertained to G.K. until she was finished and told to put “G.K. Logistics” as the heading.
[37] I find this hard to believe when she admits that she was aware that Mr.
Singh paid the three payments totaling $25,000 and the bank draft totaling $9,450, and when she was present when the latter amount was paid to TPine.
The Law
[38] No party argued any law before me. The law, however, is not controversial.
When dealing with oral contracts, the Court of Appeal set out four criteria to be met: (i) it is necessary to distill from the words and actions of the parties, at the time the contract was entered into, what they intended; (ii) evidence of the parties' subjective intentions has no independent place in determining the terms of their bargain; (iii) the test of what the parties agreed to requires an objective determination; and (iv) the contract must include the requisite elements of offer, acceptance and consideration (see: S&J Gareri Trucking Ltd. v. Onyx Corporation, 2016 ONCA 505 at para. 7).
Analysis
Gift or loan?
[39] The first question to be addressed is the nature of the transaction.
[40] I have no doubt that Mr. Singh loaned money. I do not accept that Mr.
Singh gave between $25,000 and $40,000 to either of the defendants, as a gift. There is no reliable evidence that the money was a gift. It makes no business sense that the money was a gift. The defendant, G.K., was not Mr. Singh’s company. Neither Mr. Gill nor Ms. Sandhu were related to Mr. Singh.
[41] There is one further piece of evidence, which is not determinative of this point, but speaks to it. In Mr. Singh’s company’s 3 August 2018 letter terminating Ms. Sandhu’s employment, item number four says “in spite of our various representations to you, you have failed to pay the overdue loan amount in the sum of $38,079.60 and interest due since June 1, 2018.” Ms. Sandhu never objected to or denied this paragraph. This issue is not determinative in that Mr. Singh cannot create a contract that did not exist otherwise by stating that there is one exists and having it come into existence because Ms. Sandhu did not deny that it existed. This evidence is a piece of relevant evidence in that one would have expected a denial of the existence of the loan, especially in light of Ms. Sandhu’s other evidence at trial.
[42] I conclude it only could have been a loan.
Who was the borrower?
[43] The defendants’ alternate position is that if the advance of money was a loan, it was everyone’s intention that the money was being loaned to G.K.. This is supported, the defendants say, by all of the documentation with TPine such as the lease, the guarantees, and the confirmation of delivery were all between TPine and G.K..
[44] While these documents speak to the ultimate recipient of the money, they do not address to whom Mr. Singh loaned the money.
[45] Mr. Singh says that Ms. Sandhu approached him about borrowing the money, that he did not know about G.K. Logistics until he signed the guarantee on or shortly after delivering the second installment to TPine on 27 April 2017, and he did not know Mr. Gill other than in passing, and only as Ms. Sandhu’s fiancé.
[46] The defendants’ position is that it was Mr. Singh who approached Mr. Gill, suggested that he purchase or lease the truck, and offered Mr. Gill help in doing so. Ms. Sandhu said that Mr. Singh and Gill became friends, sometimes dining out together.
[47] The evidence in support of the gift proposition came from Ms. Sandhu. For the reasons stated, above, I do not accept her evidence. Mr. Gill had the opportunity to address the issue in his testimony but did not. Therefore, I am left with Mr. Singh’s unchallenged evidence in this respect. I find that Ms. Sandhu
borrowed the money for the down payment. I find that Mr. Singh knew of the existence of G.K. by 29 March because he suggested that Ms. Sandhu open a business account for the business, and took her to the bank that day. This finding means that Mr. Singh also likely knew that G.K. would be taking delivery of the truck. Mr. Singh’s knowledge of this fact does not alter my finding that he loaned the money to Ms. Sandhu.
[48] There is no doubt that G.K. Logistics was the ultimate beneficiary of the borrowed money. I do not conclude, however, that it was a borrower along with Ms. Sandhu. Indeed, Mr. Singh was adamant that Ms. Sandhu was the borrower and not G.K..
What were the terms of the contract?
[49] As indicated, above, there is no dispute between the parties that whatever the agreement was with respect to the money advance, it was an oral agreement.
[50] Looking at the words and actions of the parties at the time the contract was entered into, I accept Mr. Singh’s evidence that after he was approached by Ms. Sandhu, he agreed to lend her the down payment for a lease for the truck that her then fiancé would drive. Mr. Singh paid to TPine, on Ms. Sandhu’s behalf, $25,000 by way of charges to three credit cards on 28 March 2017, and that on 27 April 2017 Mr. Singh and Ms. Sandhu went to TPine together to pay the fourth instalment of the down payment of $9,459 paid by money order from Mr. Singh’s
account to TPine. It was at that time that Mr Singh learned that the truck lease was taken out by G.K. Logistics, as a fact of which he was aware as of 28 March. He did not object and provided a personal guarantee of the obligations under the lease.
[51] I also find that there was an agreement that interest would be paid on any outstanding balance on the loan after the first anniversary of the loan, although there was no agreement as to what that rate should be.
[52] According to section 3 of the Interest Act RSC 1985, C. I – 15, where no interest is stated in a contract, the rate shall be 5% per annum.
What amount was borrowed?
[53] Mr. Singh claims $43,411.73, representing the payments he loaned to Ms.
Sandhu, plus interest from the first anniversary of the loan and the date the Statement of Claim was issued.
[54] The defendants do not contest that Mr. Singh paid TPine, on Ms. Sandhu’s and GK’s behalf, $34,459. The defendants dispute that he advanced a further
$3,679.60.
[55] Mr. Singh says that he made the additional smaller loans in April and May to assist Ms. Sandhu in making the first payments on the lease.
[56] That these payments were made rests solely on Mr. Singh’s oral evidence.
He says he made the two larger payments of $2,085 and $1,104.60 by personal cheques, and the payments of $390 and $100 by cash.
[57] Given Mr. Singh’s level of business sophistication and acumen, it is remarkable that he did not document his loan to Ms. Sandhu. His business acumen notwithstanding, I would have expected that he would have produced at trial the cancelled cheques for those sums he paid to Ms. Sandhu by personal cheque. Absent this corroboration, I do not find that he paid $3,679.60 in the four payments he says he made between April and May, 2017.
[58] I find that the amount he loaned to Ms. Sandhu was $34,459.
Order
[59] The plaintiff shall have judgement against Ms. Sandhu for: 1. $34,459.00 for damages;
$4,262.53 for pre-judgment interest from June 1, 2018 until November 20, 2020 at a rate of 5%; and
post judgement interest at the post judgement interest rate prescribed by the Courts of Justice Act.
Costs
[60] I will decide the issue of costs in writing. Submissions are limited to three double-spaced, type-written pages, excluding Bills of Costs and Offers. The plaintiff’s submissions are to be served and filed by 4 PM, 15 December 2020, and each defendant’s response submissions are to be served and filed by 4 PM, 31 December 2020.
Trimble J.
Released: November 26, 2020
COURT FILE NO.: CV-18-3354-00
DATE: 2020 11 26
ONTARIO SUPERIOR COURT OF JUSTICE
B E T W E E N:
DIDAR SINGH
Plaintiff
- and -
KIRANDEEP KAUR SANDHU and G.K. LOGISTICS INC.
Defendants
REASONS FOR JUDGMENT
Trimble J.
Released: November 26, 2020