Court File and Parties

Barrie Court File No.: CV-24-00000266-0000

Date: 2025-09-02

Ontario Superior Court of Justice

Between:

1000005996 Ontario Ltd., Plaintiff

– and –

Vajinder Virk, Defendant

Counsel:

• Alastair J. McNish, for the Plaintiff
• Amrita Mann, for the Defendant

Heard: August 26, 2025

Reasons for Decision

Justice R.E. Charney

Introduction

[1] This motion is brought by the Plaintiff for summary judgment against the Defendant in relation to an alleged mortgage default.

Facts

[2] On April 8, 2022, the Defendant, Vajinder Virk ("Virk"), granted the Plaintiff, 1000005996 Ontario Ltd. ("BraichCo.") a mortgage over a property municipally known as 4498 Sunnidale Concession 2 Road, New Lowell, Clearview, Ontario (the "Property"), by way of a Transfer of Charge from the prior mortgagees (the "Mortgage").

[3] The Mortgage was for a period of six months, securing the principal sum of $1,350,000.00 plus interest at the rate of 9% per annum calculated monthly. The mortgage provides for payment by monthly interest only instalments of $10,125.00 to be paid on the first day of each month commencing May 1, 2022, with the balance due and payable on the maturity date of November 1, 2022.

[4] The Mortgage provided that if the balance was not paid on the date of maturity, then, with the consent of BraichCo., it would be renewed at the same terms and conditions, with Virk liable to pay a renewal fee equal to 6% of the principal.

[5] The Standard Charge Terms incorporated into the Mortgage also provided that upon default of payment of principal and interest, BraichCo. may enter and take possession of the Property. Further, upon a default of the payment of interest, the principal, at the option of the mortgagee, immediately becomes payable.

[6] The Mortgage matured on November 1, 2022 and was automatically renewed pursuant to the terms of the Mortgage, with a new maturity date of May 1, 2023.

[7] Upon renewal of the Mortgage, Virk provided BraichCo. with six post-dated cheques in the amount of $10,125.00 for each month of the renewed six-month term.

[8] Virk requested to pay a reduced renewal fee. The Plaintiff takes the position that this request was denied and that Virk failed to pay the renewal fee of $81,000.00. The Defendant alleges that the parties negotiated and agreed to a reduced renewal fee of 4% ($54,000) and that she paid this amount to the Plaintiff in cash. I will return to this factual dispute later in these reasons.

[9] The first post-dated cheque for November 2022 was returned for insufficient funds. Virk then requested that BraichCo. hold off cashing the November 2022 and December 2022 post-dated cheques until further notice. BraichCo. agreed and cashed the November 2022 cheque in January 2023. The interest-only payments in the amount of $10,125 were made by Virk in February, March, April, and May 2023 (being for December 2022, and January, February, and March, 2023 respectively). At the request of Virk, the April 2023 payment was not cashed until August, 2023.

[10] The Plaintiff alleges that no payments of principal or interest have been made under the mortgage since April 2023.

[11] In May 2023, BraichCo. cautioned Virk that the Mortgage was not renewed, that principal and interest was due and payable, and that the Mortgage was in default. Based on repeated assurances from a mutual acquaintance that the Mortgage would be paid in full, BraichCo. held off on enforcement steps until December 2023.

[12] On December 18, 2023, BraichCo. sent a demand letter providing Virk until January 3, 2024 to bring the Mortgage into good standing. No payments were made.

[13] As of January 25, 2024, the day before the Statement of Claim was issued, there was outstanding under the Mortgage the following amounts:

• Principal: $1,350,000.00
• Accrued interest April 1, 2023 – January 25, 2024: $99,447.00
• Interest under section 17 of the Mortgages Act: $30,375.00
• Renewal fee: $81,000.00
• Administration fee: $700.00
• Missed payment fee: $4,900.00
• Possession fee: $1,000.00
• Legal fees (HST included): $5,650.00

TOTAL BALANCE DUE AND OWING as at January 25, 2024: $1,573,072.00

[14] A Notice of Sale, dated January 25, 2024, was served on Virk on January 29, 2024.

[15] The Statement of Claim was issued on January 26, 2024 and served on Virk the same day as the Notice of Sale.

[16] The Statement of Defence is dated May 27, 2025 and acknowledges the loan for $1,350,000 at 9% interest, but alleges that the Plaintiff agreed to accept $54,000 for the renewal fee and that she paid the mortgage from December 2022 to May 2023. She further alleges that in May 2023 the parties agreed to renew the mortgage for another year without any renewal fee. She provided the Plaintiff with post-dated cheques for the months of June 2023 to May 2024, and that although the June 2023 cheque was cashed in August 2023, none of the other post-dated cheques have been cashed or deposited by the Plaintiff.

Adjournment Request

[17] At the outset of the motion, counsel for the Defendant requested an adjournment on the ground that the motion would take more than one hour to argue, and the Defendant had not had an opportunity to file a factum in support of her position. The request for an adjournment was denied for the following reasons:

[18] On January 9, 2025, the parties agreed to the following timetable for the Plaintiff's summary judgment motion:

• Moving Party's Motion Record previously served on November 18, 2024
• Responding Record to be served and filed by March 7, 2025
• Cross-examination to be completed by April 4, 2025
• Moving Party's factum to be served and filed by April 16, 2025
• Responding factum to be served and filed by April 22, 2025

[19] On February 27, 2025, due to a contentious dispute about possession of the subject property, the Plaintiff requested an urgent motion. The Barrie Trial Co-ordinator agreed to schedule the motion if less than 60 minutes were required. The urgent motion was scheduled for March 18, 2025.

[20] On March 18, 2025, Justice McKelvey granted the Responding Party's request for an adjournment stating:

This is a motion for possession. The plaintiff originally requested 90 minutes for argument and then had it put on a regular list with a time estimate of 60 minutes. The defendant indicates that in their view the motion will take 2 hours. No responding material has yet been filed. There is a motion for summary judgment which is scheduled as well in this action to be spoken to on May 13, 2025. While I agree that there is some urgency in this case I don't feel it is appropriate for this matter to be on a regular motion list. I order that it be put on the list to be spoken to on May 13, 2025 triage court with a request that it be given some priority for a hearing date.

[21] The Responding Party Virk failed to deliver a Responding Record by March 7, 2025. Virk also did not request to cross-examine Resham Braich on his affidavit.

[22] The Moving Party served its Factum on April 16, 2025 in accordance with the agreed timetable.

[23] On April 22, 2025, the lawyer for the Moving Party emailed the lawyer for Virk, requesting confirmation of whether Virk would be delivering a Factum. No response was received from Amrita Mann or anyone from her firm.

[24] Triage Court proceeded on May 13, 2025. Through inadvertence, counsel for Virk did not attend Triage Court until 9:30 a.m., after the matter had already been heard.

[25] At Triage Court, Alastair McNish, counsel for the Moving Party, advised the court that no responding material had been delivered. On that basis, RSJ Edwards directed the matter to proceed to summary judgment for one hour or less.

[26] The summary judgment motion was scheduled for August 12, 2025.

[27] On July 4, 2025, the lawyer for Virk emailed the Plaintiff's lawyer to advise that she was not available on August 12, 2025, but that she was available on August 19, 26 or September 2, 2025, and asked the Plaintiff's lawyer to "take steps to reschedule the motion to one of those dates". There was no indication from the lawyer for Virk that she no longer considered herself bound by the agreed timetable or that she intended to file an affidavit 3 days before the motion date. There was no opposition to the motion being scheduled for 60 minutes, and no indication that she would be seeking an adjournment. The motion was rescheduled for August 26, 2025.

[28] On August 20, 2025, three business days before the hearing – and more than 5 months after the date in the agreed timetable - Virk delivered a Responding Record and indicated that she would seek an adjournment.

[29] Given that this matter was scheduled for 60 minutes at Triage Court by RSJ Edwards on May 13, 2025, and given the timetable previously agreed to by counsel, and the Defendant's eleventh-hour request for an adjournment, I denied the adjournment request.

Motions for Summary Judgment

[30] Rule 20.04(2)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 provides: "The court shall grant summary judgment if the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence."

[31] Rule 20.04(2.1) sets out the court's powers on a motion for summary judgment:

In determining under clause (2)(a) whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties and, if the determination is being made by a judge, the judge may exercise any of the following powers for the purpose, unless it is in the interest of justice for such powers to be exercised only at a trial:

1. Weighing the evidence.
2. Evaluating the credibility of a deponent.
3. Drawing any reasonable inference from the evidence.

[32] These powers were extensively reviewed by the Supreme Court of Canada in Hryniak v. Mauldin, 2014 SCC 7, where it laid out a two-part roadmap for summary judgment motions, at para. 66:

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.

[33] Even with these extended powers, a motion for summary judgment is appropriate only if the material provided on the motion "gives the judge confidence that she can find the necessary facts and apply the relevant legal principles so as to resolve the dispute" (Hryniak, at para. 50).

[34] In Hryniak, the Supreme Court held (at para. 49) that there will be no genuine issue for trial when the summary judgment 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."

[35] To defeat a motion for summary judgment, the responding party must put forward some evidence to show that there is a genuine issue requiring a trial. A responding party may not rest on mere allegations or denials of the party's pleadings, but must set out—in affidavit material or other evidence—specific facts establishing a genuine issue requiring a trial. The parties may not rely on the prospect that additional evidence may be tendered at trial: Sweda Farms Ltd. v. Egg Farmers of Ontario, 2014 ONSC 1200 (Ont. S.C.J.), at para. 26, aff'd 2014 ONCA 878 (Ont. C.A.), leave to appeal to SCC refused, [2015] S.C.C.A. No. 97 (S.C.C.)

[36] It is well settled that "both parties on a summary judgment motion have an obligation to put their best foot forward" (see Mazza v. Ornge Corporate Services Inc., 2016 ONCA 753, at para. 9). Given the onus placed on the moving party to provide supporting affidavit or other evidence under Rule 20.01, "it is not just the responding party who has an obligation to 'lead trump or risk losing'" (see Ipex Inc. v. Lubrizol Advanced Materials Canada, 2015 ONSC 6580, at para. 28).

[37] A plaintiff or defendant bringing a motion for summary judgment has the initial onus of proving that there is no genuine issue for trial and must file some affidavit evidence to support that position. See for example, Sanzone v. Schechter, 2016 ONCA 566, at paras. 30-32, confirming the initial evidentiary obligation borne by the moving party (in that case the defendant) on a summary judgment motion.

[38] If the moving party meets the evidentiary burden of producing evidence on which the court could conclude that there is no genuine issue of material fact requiring a trial, the responding party must either refute or counter the moving party's evidence or risk a summary judgment.

[39] As held by Perell J. in Levac v. James, 2016 ONSC 7727, at para. 132:

Hryniak v. Mauldin does not alter the principle that the court will assume that the parties have placed before it, in some form, all of the evidence that will be available for trial. The court is entitled to assume that the parties have advanced their best case and that the record contains all the evidence that the parties will present at trial…

[40] While Rule 20.04 provides the court hearing a summary judgment motion with "enhanced forensic tools" to deal with conflicting evidence on factual matters, the court should employ these tools and decide a motion for summary judgment only where it leads to "a fair process and just adjudication": Mason v. Perras Mongenais, 2018 ONCA 978, at para. 44; Eastwood Square Kitchener Inc. v. Value Village Stores, Inc., 2017 ONSC 832, at paras. 3-6 (and cases cited therein).

[41] Having reviewed the material filed by each party, I am satisfied that this is an appropriate case in which to proceed by way of motion for summary judgment. Where there is a factual dispute, I am satisfied that I can make the necessary factual findings based on the affidavit evidence filed by the parties.

[42] I note that the Defendant did not file a factum as required by Rule 20.03. I also note that the Defendant filed an affidavit well outside the timetable agreed to by the parties. I will, however, consider that affidavit in my analysis. I will not, however, draw any adverse inference against the Plaintiff for not cross-examining on or otherwise responding to the late filed affidavit since it was not possible for the Plaintiff to schedule a cross-examination when the affidavit was served only 3 business days before the motion.

Analysis

[43] The Plaintiff relies on the affidavit of Resham Braich, the sole shareholder of the corporate Plaintiff. This Affidavit sets out the terms of the mortgage agreement between Virk, as the Mortgagor, and the Plaintiff, as the Mortgagee. The terms of the mortgage and the fact of the loan are not in dispute. His affidavit supports the summary of facts set out at paras. 2-13 above.

[44] The Plaintiff states that the Defendant failed to pay the $81,000 (6%) renewal fee "despite my insistence that it was a contractual requirement", and that he did not consent to the renewal of the mortgage in May 2023. He held off enforcing the mortgage because a mutual friend – Kanwar Brar – assured him that the Virk was trustworthy and would make good on the mortgage. He was told that the Defendant had a buyer for the property and would pay the mortgage in full once it was sold. He was told several times that the sale was imminent, but each time he was told that the sale did not close.

[45] The factual dispute in this case relates to the Defendant's allegation that the parties negotiated and agreed to a reduced renewal fee of 4% ($54,000) and that she paid this amount to the Plaintiff in cash.

[46] The Defendant relies on the affidavit of Kanwarjit Singh Brar, the mutual friend referred to in the Plaintiff's affidavit. Mr. Brar is a real estate agent. The Defendant has listed the mortgaged property for sale with Mr. Brar's real estate brokerage. The Defendant has listed the property for sale for $1,599,000.

[47] Mr. Brar's affidavit states that in November 2022 Mr. Braich advised him that he was agreeable to reducing the refinancing fees from 6% to 4% on the condition that the payments were made in cash. He communicated this information to the Defendant, who agreed to this arrangement. In the first week of November 2022, he attended at "Braich's uncle's house… met Braich in the driveway where I handed over to him a suitcase with $54,000 in cash, representing the financing fees".

[48] There is nothing in Mr. Brar's affidavit to corroborate this statement. There is no written correspondence or emails of any kind between Mr. Brar or Ms. Virk and Mr. Braich to confirm that such an offer was ever made or discussed. There are no banking records to corroborate the transfer of $54,000 in cash. There is no receipt or acknowledgement from Mr. Braich that these funds were received.

[49] There is no affidavit from Ms. Virk to support this statement.

[50] Assuming that the Defendant has put her best foot forward and provided this Court with "all of the evidence that will be available for trial", I do not believe that any party would hand over "a suitcase with $54,000 cash" without obtaining some form of contemporaneous written acknowledgement that the parties had agreed to depart from the express terms of the written agreement or that the funds were received. In the absence of some corroborating evidence, I simply do not believe Mr. Brar's evidence on this point.

[51] The Defendant raises two additional legal issues on this motion for summary judgment.

[52] First, she relies on s. 42(1) of the Mortgages Act, R.S.O. 1990, c. M.40, which states that a mortgagor may not take further action or proceed to enforce a mortgage until after the expiry of the 35 day period during which payment must be made pursuant to the Notice of Sale, unless an order permitting the same has been obtained from a judge of the Superior Court. During the time period stipulated in the notice of sale, a mortgagor shall not be subject to an action as during those 35 days, the mortgagor has time to correct the default.

[53] The Defendant argues that because the Statement of Claim was issued before the Notice of Sale was served, the Statement of Claim is a nullity.

[54] This provision has been considered in several court decisions which reject the argument that a Statement of Claim issued within the notice period is a nullity. In RiverRock Mortgage Investment Corporation v. Blazys et al., 2024 ONSC 6357, Wilkinson J. stated, at para. 43:

The purpose of s. 42 of the Mortgages Act is to provide the mortgagor in default with an opportunity to correct the default without the additional concern or requirement of having to retain counsel. However, the combined effect of s. 31 and s. 42 of the Mortgages Act is not that a Statement of Claim cannot be issued before the notice period has expired, but rather, it prohibits the enforcement of a judgment for possession of a property until after the "breathing space" required by s. 42 of the Mortgages Act has expired: Resco Mortgage Investment Corp v. Kaur, 2024 ONSC 3615, 61 R.P.R. (6th) 310, at para. 106.

[55] The Courts have found that issuing the Statement of Claim prior to the Notice of Sale is a "technical" problem that, provided there is no prejudice to the Defendant, can be remedied with a nunc pro tunc order. Wilkinson J. explained, at para. 45:

The impact of the Statement of Claim being issued before the notice of Power of Sale was served was also considered by Justice Reid in New Haven Mortgage Corp. v. Codina, 2022 ONSC 7036, 51 R.P.R. (6th) 47, in which he described this type of situation as a "technical" problem and found that there was no evidence of prejudice to the Defendants. He stated at para. 37:

…At most, the issuing of the statement of claim prior to the expiry of the notice period under the notice of sale was a technical problem, which the Act allows to be addressed in s. 42 by a court order. I am prepared under these circumstances to make an order nunc pro tunc permitting the statement of claim to be issued in advance of expiry of the notice period under the notice of sale.

[56] See also: McKenna Estate v. Marshall, at paras. 26 and 28:

The Mortgages Act provides certain extraordinary protections to mortgagors but it also reflects the public interest in providing mortgage lenders a means of realizing upon their security.

In my opinion s. 42 of the Mortgages Act does not preclude a nunc pro tunc order. In the absence of such a prohibition s. 42 should be interpreted to allow a nunc pro tunc order as such jurisdiction is conducive to securing the interests of justice and the objects of the Act.

[57] In this case, the Notice of Sale was served on January 29, 2024, and the Defendant had 35 days from that date to correct the default. The Statement of Claim was issued on January 26, 2024, and served along with the Notice of Default on January 29, 2024.

[58] Although the action was commenced, no further steps were taken to enforce the mortgage. The Statement of Defence is dated May 27, 2025 – nearly 4 months after the Statement of Claim was served. This far exceeds the 35 day notice period in the Notice of Sale. Given this lapse of time, there was no prejudice to the Defendant, and I will issue a nunc pro tunc order to permit the Statement of Claim to be issued on January 26, 2024.

[59] The second legal argument raised by the Defendant is the Farm Debt Mediation Act, S.C. 1997, c. 21, which provides for mediation between insolvent farmers and their creditors. The Defendant alleges that the mortgaged property is a farm, and that she did not receive the notice required by s. 21 of the Act.

[60] The relevant sections of the Act provide:

5 (1) Subject to sections 6, a farmer may apply to an administrator for either

(a) a stay of proceedings against the farmer by all the farmer's creditors, a review of the farmer's financial affairs, and mediation between the farmer and all the farmer's creditors for the purpose of assisting them to reach a mutually acceptable arrangement; or

(b) a review of the farmer's financial affairs, and mediation between the farmer and all the farmer's secured creditors for the purpose of assisting them to reach a mutually acceptable arrangement.

6 Only farmers

(a) who are for any reason unable to meet their obligations as they generally become due,

(b) who have ceased paying their current obligations in the ordinary course of business as they generally become due, or

(c) the aggregate of whose property is not, at a fair valuation, sufficient, or if disposed of at a fairly conducted sale under legal process would not be sufficient, to enable payment of all their obligations, due and accruing due

are eligible to apply under section 5.

[61] Section 21(1) of the Act requires secured creditors who intend to commence enforcement proceedings to give the farmer notice under the Act. It provides:

21 (1) Every secured creditor who intends to

(a) enforce any remedy against the property of a farmer, or

(b) commence any proceedings or any action, execution or other proceedings, judicial or extra-judicial, for the recovery of a debt, the realization of any security or the taking of any property of a farmer

shall give the farmer written notice of the creditor's intention to do so, and in the notice shall advise the farmer of the right to make an application under section 5.

Time of notice

(2) The notice must be given to the farmer and to an administrator, in the form established by the Minister and in accordance with the regulations, at least 15 business days before the doing of any act described in paragraph (1)(a) or (b).

[62] Farmer is defined as: "farmer means any person, cooperative, partnership or other association of persons that is engaged in farming for commercial purposes and that meets any prescribed criteria."

[63] In my view, the Farm Debt Mediation Act has no application to the present situation. The Act applies to secured creditors who want to enforce any remedy against "the property of a farmer".

[64] There is a dispute between the parties whether the property is currently vacant or tenanted. Either way, there is no evidence that the Defendant is a farmer. As such, the mortgaged property – even if it is a farm – is not "the property of a farmer".

Conclusion

[65] For the foregoing reasons, the motion for summary judgment is granted.

[66] The Court makes the following orders:

a. Summary judgment against the defendant for $1,731,188.44 for payment under the Mortgage made between the Plaintiff and the Defendant;

b. Possession of the lands as set out in the Plaintiff's draft order;

c. Leave to issue a Writ of Possession for the Property directed to the Sheriff of the Regional Municipality of Simcoe; and

d. Post-judgment interest at the rate of 9% per annum.

[67] As per para. 8 of the Standard Charge Terms of the mortgage, costs are fixed at the full indemnity rate (Everest Finance Corporation v. Jonker, 2023 ONCA 87, at para. 8; Everest Finance Corporation v. Jonker, 2023 ONCA 146, at para. 3). Costs are fixed at $29,944, payable by the Defendant and added to the amount secured by the charge as per the terms of the Mortgage.

Justice R.E. Charney

Released: September 2, 2025