Court File and Parties

COURT FILE NO.: 17-72986

DATE: 20210519

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: ECN FINANCIAL INC., Plaintiff/Moving Party

AND:

9130764 CANADA INC. c.o.b. as OPTICAL VISION OF CANADA LTD. and ANTRANIK MARDIROS KECHICHIAN, Defendants

BEFORE: Mew J.

COUNSEL: Fraser Mackinnon Blair, for the Plaintiff/Moving Party

Antranik Kechichian, litigant in person

HEARD: 26 January 2021, at Ottawa (by videoconference)

ENDORSEMENT

[1] This endorsement should be read in conjunction with my endorsement in 1951584 Ontario Inc. v. Kechichian, Court File No. CV-19-81579 (Ottawa), 2021 ONSC 3617.

[2] This motion is one of four summary judgment motions brought by commercial lenders to enforce the terms of certain loan agreements as well as personal guarantees associated with those agreements.

[3] The agreements which are the subject of this particular motion for summary judgment are described as “lease agreements” but were, effectively, term loans in which the indebtedness of the corporate borrowers was secured by Mr. Kechichian’s personal guarantees. The loans were advanced to support leasehold improvements and other expenditures related to the borrowers’ business of providing optometry related products and services under the “Laurier Optical” banner.

[4] The lease agreements contained provisions entitling the lender, upon a default, to obtain liquidated damages for the aggregate of any unpaid amounts owing, the amount of the remaining payments until the end of the term and any amounts otherwise due. The guarantees provided that the lender could give up security or otherwise deal with the borrower or others from the sale or other disposal of security without prejudice to, or in any way limiting or lessening, the liability of the guarantor. The guarantor also expressly provided that the lender was not required to exhaust its recourse against any lessee or under any other security before being entitled to payment under the guarantees.

[5] The plaintiff now seeks summary judgment for the principal outstanding amount under the lease agreements, being $203,176.24, together with contractual interest thereon since 1 February 2017 at the contractual interest rate of 18% per annum, being $212,009.99 at the time the motion was argued plus, in the case of Mr. Kechichian personally, additional interest provided for under the terms of the guarantee, of 5.7% since 1 February 2017, totalling $77,811.98 as of the date of the summary judgment motion being argued.

[6] As he did in the 1951584 Ontario Inc. v. Kechichian matter, Mr. Kechichian does not deny that the leases went into default. Nor does he challenge the terms of the guarantees or the amounts claimed. His defence to the plaintiff’s claims rests on his argument that before pursuing payment under the lease agreements and guarantees, the plaintiff had an obligation to seize, protect or sell the collateral and, having failed to do so, should not be entitled to enforce the loans or guarantees.

[7] For the same reasons that I gave in 1951584 Ontario Inc. v. Kechichian, these defences fail.

[8] I would add, however, that the record in this case indicates that the plaintiff did, in fact, engage in extensive efforts to identify the property subject to the lease agreements in the context of CCAA proceedings in the Québec Superior Court in the application by Gestion Éric Savard and affiliated companies. Those steps are summarised in paragraph 26 of the moving party’s factum.

[9] There being no triable issues on the defences raised by the defendants, the plaintiff is entitled to judgment in the amounts previously stated, plus any additional contractual interest that has accrued from the date that such interest was last calculated until the present date.

[10] I would, however, exercise my discretion to provide that post-judgment interest shall accrue at the statutory rate provided for under the Courts of Justice of Act, rather than the contractual rate.

[11] I am presumptively of the view that the plaintiff is entitled to its costs of this motion and of the action. The plaintiff shall provide written submissions not exceeding four pages in length, in addition to a costs summary which should have attached to it copies of any offers to settle or other documents pertinent to the issue of costs within 21 days of receipt of these reasons. The defendants may provide a responding submission, not to exceed four pages, by no later than 14 days, after the plaintiff’s submissions are delivered.

[12] All submissions can be sent by email to my judicial assistant.

Mew J.

Date: 19 May 2021