COURT FILE NO.: CV-21-593 DATE: 2023 02 17

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: The Bank of Nova Scotia, Plaintiff AND: Richard Anozie and Emmanuel M. Anozie, a.k.a. Emmanuel L.M. Anozie, a.k.a. Emmanuel Anozie, a.k.a. Emmenuel Anozie, Defendants

BEFORE: Doi J.

COUNSEL: Kelly Y.W. Hou, for the Plaintiff Emmanuel M. Anozie, self-represented Defendant [1]

HEARD: December 15, 2022

Endorsement

Overview

[1] On this motion, the Plaintiff, The Bank of Nova Scotia (“Bank”), seeks summary judgment against the Defendant, Emmanuel Anozie (“Emmanuel”), for an unpaid line of credit under a personal credit agreement. [2] On April 1, 2021, the Bank obtained default judgment against the other Defendant, Richard Anozie (“Richard”), who did not defend the action.

[2] For the reasons that follow, I find that the summary judgment motion should be granted.

Legal Principles for Summary Judgment

[3] Rule 20.04(2)(a) provides that the court shall grant summary judgment if satisfied that there is no genuine issue requiring a trial with respect to a claim or defence.

[4] On a motion for summary judgment, there will be no genuine issue requiring a trial where the court is able to reach a fair and just determination on the merits. This will be the case where the process: a) allows the judge to make the necessary findings of fact, b) allows the judge to apply the law to the facts, and c) is a proportionate, more expeditious and less expensive means to achieve a just result: Hryniak v. Mauldin, 2014 SCC 7 at para 49.

[5] A summary judgment motion involves a two-step approach. First, the court must decide whether there is a genuine issue that requires a trial based only on the evidence in the record, without using its fact-finding powers. Where there is no genuine issue requiring a trial, summary judgment must be granted. Should there appear to be a genuine issue requiring a trial, the court must then decide whether the need for a trial can be avoided by having recourse to its fact-finding powers under Rules 20.04 (2.1) and (2.2) to weigh evidence, evaluate credibility, and draw inferences: Hryniak at para 66.

[6] A party moving for summary judgment has the burden of showing there is no genuine issue for trial. To defeat a summary judgment motion, the responding party must put forward some evidence to show there is a genuine issue requiring a trial or risk summary judgment being granted: Alphera Financial Services Canada (BMW Canada Inc.) v. Ambihaipalan, 2021 ONSC 3530 at para 23; Toronto-Dominion Bank v. Hylton, 2012 ONCA 614 at para 5. Each side must put its “best foot forward” as to the existence or non-existence of a genuine issue requiring a trial: Mazza v. Ornge Corporate Services Inc., 2016 ONCA 753 at para 9. On a motion for summary judgment, the court may assume that the evidentiary record is complete and has all the evidence that would be available at trial: Tim Ludwig Professional Corporation v. BDO Canada LLP, 2017 ONCA 292 at para 54. A responding party to a motion for summary judgment cannot rest solely on allegations in a pleading: Mercedes-Benz v. Janosh Chandrakularajah, 2021 ONSC 296 at para 7. Self-serving affidavits that merely assert defences without providing some detail or supporting evidence are not sufficient to create a genuine issue for trial: Rozin v. Ilitchev (2003), 66 OR (3d) 410 (CA) at para 8.

[7] Rule 20.04 is intended to avoid protracted litigation that is unnecessary to achieve a just result. Rule 1.04 animates the interpretation of Rule 20.04 by requiring a liberal construction to secure the just, most expeditious and least expensive determination of a proceeding on its merits in a manner that is proportionate to the complexity of the issues and the amounts involved. This is a contextual assessment. What is fair and just will turn on the nature of the issues, the nature of the evidence required to resolve the issues, and what is a proportionate procedure having regard to the amounts at stake: Hryniak at paras 27-29; BMW at paras 18-20. A documentary record will often suffice to resolve material issues fairly and justly: Hryniak at para 57.

Background

[8] On December 1, 2008, Richard and Emmanuel both signed a personal credit agreement with the Bank for a $20,000.00 joint personal line of credit (the “LOC Agreement”). The LOC Agreement states the following just about the Defendants’ signatures:

ACKNOWLEDGMENT By signing this document, you promise to pay or guarantee the loans specified above and in any addendum. You also agree to be bound by the terms and conditions on this document and in the companion booklet(s), which forms part of this agreement. You acknowledge receipt of a copy of the companion booklet(s), including the Scotia Group Privacy Agreement and the Telephone/Facsimile/E-Mail Banking Agreement.

By signing the LOC Agreement, the Defendants agreed that the Bank’s companion booklet (the “Companion Booklet”) formed part of the LOC Agreement. The Bank’s standard practice is to mail a copy of the Companion Booklet and any amendment or replacement to customers.

[9] Pursuant to the LOC Agreement, the Bank gave a line of credit to Richard and Emmanuel to a credit limit of $20,000.00 which was assigned to a line of credit account (the “LOC”).

[10] Where there are multiple borrowers, the Companion Booklet provides that the borrowers’ obligations are joint and several. When Richard and Emmanuel borrowed funds, used a credit account, or authorized others to use a credit account from the Bank under the LOC Agreement, they incurred debt to the Bank which they were obligated to repay under the terms and conditions of the LOC Agreement and the Companion Booklet, respectively.

[11] Under the terms of the Companion Booklet, Richard and Emmanuel agreed to pay a minimum monthly amount if they did not repay the debt in full. They agreed that a default would occur if they failed to honour the terms of the loan or credit account. In addition, they agreed that interest would be charged at the applicable rate under the terms of the LOC Agreement, before and after the final payment date, maturity, default and judgment, until the debt was paid off in full. They further agreed to pay legal costs if the Bank had to bring collection proceedings, acknowledged that the Bank may require them to pay the total balance due if they defaulted on the LOC Agreement, and agreed that they would not be relieved of their obligations under the LOC Agreement if the agreement were terminated for any reason.

[12] From time to time, funds were drawn on the LOC and payments were periodically made against the LOC as set out in monthly statements which gave the Defendants particulars of these transactions and payments. The monthly statements also gave particulars of the important terms and conditions for the LOC and the applicable interest rates and notice of changes to the rates.

[13] The Defendants defaulted on the LOC Agreement by failing to make the required minimum payments as they came due, and by exceeding the LOC’s prescribed credit limit. The last payment for the LOC was made on June 28, 2019 in the amount of $250.00. By July 19, 2019, the LOC was overdue by $439.38. Thereafter, the LOC account went into continuous default with an applicable interest rate of 14.20% per annum.

[14] As a result of the continuous default, the Bank issued a demand on December 18, 2019 for the Defendants to pay the full balance due and owing under the LOC.

[15] As of December 18, 2020, the outstanding balance on the LOC was $35,271.69 which remains owing with interest at 14.20% per annum. Since then, no payments have been made against the outstanding balance.

Analysis

[16] From the evidence filed on the motion, I am satisfied that there are no genuine issues that require a trial. I find that the record is sufficient to fairly adjudicate the disputed issues and that summary judgment is a just and proportionate procedure to apply in determining this matter.

[17] Emmanuel submits that the LOC was overdrawn by 2015 which should have prompted the Bank to issue a demand and accelerate the indebtedness earlier. However, debt payments to the LOC kept the account current for a period of time. The last payment to the LOC was made on June 28, 2019. After issuing a written demand for repayment on December 18, 2020, the Bank brought this action on February 22, 2021. In the circumstances, I am satisfied that the claim was commenced well within the applicable 2-year limitation period: ss. 4 and 5 of the Limitations Act, 2002, SO 2002, c. 23, Sched. B.

[18] From the record, I am satisfied that Emmanuel either used or authorized the use of the LOC and is contractually obligated to repay this debt. In his evidence, the Defendant Emmanuel does not deny signing the LOC Agreement. He expressly concedes that he agreed to co-sign a line of credit for his brother Richard, who is the other Defendant, and acknowledges that he received a carbon copy of the LOC Agreement after he signed the agreement. Accordingly, I am satisfied that Emmanuel is a co-borrower on the LOC who used or authorized the use of the LOC at issue. In addition, I find that the LOC Agreement, the Companion Booklet, and the account statements were available to Emmanuel or alternatively were reasonably accessible by him upon request. The loan materials use simple and concise language which is relatively easy to understand.

[19] I do not find that Emmanuel can avail himself of the non est factum defence in the particular circumstances of this case. The defence of non est factum is available to “someone who, as a result of misrepresentation, has signed a document mistaken as to its nature and character and who has not been careless in doing so”: Bulut v. Carter, 2014 ONCA 424 at para 18; Marvco Color Research Ltd. v. Harris, [1982] 2 SCR 774 at 787; BMW at para 32. A lack of misrepresentation or carelessness in signing are fatal to the non est factum defence: The Guarantee Company of North America v. Ciro Excavating & Grading Ltd., 2016 ONCA 125 at para 15.

[20] In this case, Emmanuel cannot establish that he signed the LOC Agreement due to a misrepresentation by either the Bank or Richard, the co-Defendant. In his affidavit, Emmanuel claims that he attended a branch of the Bank to sign the LOC Agreement at Richard’s request. When Emmanuel signed the LOC Agreement, a Bank representative purportedly covered a portion of the contract which Emmanuel claims led him to not understand what he signed or otherwise be misled about the terms and content of the contract. Respectfully, I am not persuaded by this submission. Emmanuel could and should have asked to see any portion of the LOC Agreement that was covered or obscured by the Bank representative before signing the contract. In my view, Emmanuel was not subjected to any misrepresentation that should impair the Bank’s ability to enforce the terms and conditions of the LOC Agreement. To invoke the non est factum defence, Emmanuel has the onus to prove a misrepresentation. I find that he has failed to prove this.

[21] In any event, I find that Emmanuel was careless in signing the LOC Agreement when it was presented for his signature. By his own account, he made no inquiries, asked no questions, did not ask to read the documents before signing, did not seek independent legal advice, and otherwise took no steps to inform himself of his obligations under the contract when he signed the agreement that day. In effect, he never took the time to think about what he was signing. Instead, he simply signed what was presented to him. He claims that he was in a hurry to sign due to time constraints given where his vehicle was parked and his need to return to work that day. He also claims that he signed the paperwork as a cultural sign of trust or respect for his older brother. In my view, these circumstances should not excuse his carelessness. He purposefully attended the branch to sign what he understood were loan documents to borrow funds. By signing, he agreed to assume liability for debts to the Bank. In the circumstances, I find that he knew what he was signing and see no basis to excuse his carelessness. In arriving at this, I recognize the need for commercial certainty by not allowing someone who engaged in carelessness to disown his signature by simply asserting a lack of understanding as to what he had signed: BMW at paras 33-34; Muskham Finance Ltd. v. Howard, [1963] 1 QB 904 at 912. Accordingly, I find that the defence of non est factum is not open to Emmanuel on the facts of this case.

[22] I am not persuaded that the LOC Agreement should be set aside for duress. To set aside the agreement for duress, Emmanuel must establish that illegitimate pressure put him in a position of having no realistic alternative but to agree: Stott v. Merit Investment Corp. (1987), 63 OR (2d) 545 (CA) at para 48; Taber v. Paris Boutique & Bridal Inc., 2010 ONCA 157 at para 9; BMW at paras 24-26. Furthermore, a contract will not be set aside for duress unless other parties to the agreement knew of the duress: BMW at para 27; David v. Cooper, 2010 ONSC 4230 at para 13. On balance, I find no wrongdoing by the Bank. There is no evidence that any illegitimate pressure was placed on him to sign the LOC Agreement. In my view, the duress argument is merely a bald assertion with no evidence of any illegitimate pressure to ground his position.

Outcome

[23] Based on the foregoing, the motion for summary judgment is granted. The Bank shall have judgment for $35,271.69 as of December 18, 2020 plus pre and post judgment interest at 14.20% per annum in accordance with the contractual rate of interest under the LOC Agreement. [3]

[24] Costs for the motion are awarded to the Bank fixed at $8,800.00, inclusive of disbursements and taxes, which largely reflects the figures in its costs outline, less the work to prepare its replacement affidavit in support of the motion (i.e., which was required after its initial affiant went on leave and became unavailable for cross-examination), which I find to be fair and reasonable in all of the circumstances. [4] These costs shall be payable within 60 days with post-judgment interest fixed at the rate of 5%. The Bank may take out a formal order that is consistent with these reasons without the responding party’s consent as to form and content.

Doi J.

Date: February 17, 2023

Footnotes

[1] In responding to the motion, the Defendant, Emmanuel Anozie, was assisted by his partner, Chinwe Ilobachie, who is a law student.

[2] As the Defendants share the same surname, I shall refer to them by their first names for greater clarity. In doing so, I mean no disrespect to either party. The motion initially returned on June 2, 2022, was adjourned to August 5, 2022 to allow for cross-examinations, was further adjourned to August 17, 2022 as motion materials were not uploaded to Caselines, was further adjourned to September 28, 2022 for Emmanuel, who is self-represented, to cross-examine the Bank’s affiant on the motion, and was further adjourned to December 15, 2022 after the Bank substituted its affiant on the motion after its initial affiant went on a leave of absence for personal reasons.

[3] Absent exceptional circumstances, the contractual rate of interest that governs a loan prior to breach is the appropriate rate to apply a post-breach loan: Bank of America Canada v. Mutual Trust Co., 2002 SCC 43 at paras 49-50. In this case, I found no exceptional circumstances to warrant a variation of the contractual interest rate.

[4] The Companion Booklet provides at p. 5, “If we have to take collection proceedings under this agreement, you agree that you will pay us out legal costs for any action to collect the amounts due and out reasonable cost, including legal fees.”