Court File and Parties

Court File No.: CV-23-00701821-0000 Date: 2025-10-01 Superior Court of Justice - Ontario

Re: Morris Group Financial, Inc., Plaintiff And: White Oaks Tennis World Inc., 1526882 Ontario Inc., and Ameer Wakil, Defendants

Before: Parghi J.

Counsel: Parjot Singh Benipal, for the Plaintiff Aaron Kreaden and Hamza Mohamadhossen, for the Defendants

Heard: September 23, 2025

Endorsement

Introduction

[1] The Plaintiff, Morris Group Financial, Inc. ("Morris Group"), moves for summary judgment. It states that it is owed $1,075,000 pursuant to a term sheet entered into by one of its affiliates with the corporate defendants, White Oaks Tennis World Inc. and 1526882 Ontario Inc., on December 9, 2022 (the "Term Sheet").

[2] The Defendants resist the summary judgment motion and say that the Plaintiff has no case against them and that therefore a trial is unnecessary. They ask for "boomerang" summary judgment dismissing the action.

[3] For the reasons below, I dismiss the Plaintiff's motion for summary judgment and grant the Defendants' request for a dismissal of the action. The express language of the Term Sheet makes clear that the Plaintiff is not entitled to the payments it seeks.

The Law on Summary Judgment

[4] On a motion for summary judgment, I must first determine, based only on the record before me, whether there is a genuine issue requiring a trial. If there appears to be a genuine issue requiring a trial, I am to determine if the need for a trial could be avoided by using my enhanced powers under either rule 20.04(2.1) or 20.04(2.2) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (Hryniak v. Mauldin, 2014 SCC 7, [2014] 1 S.C.R. 87, at para. 66). In this case, I do not need to use my enhanced powers and am able to rely on the record alone.

[5] The responding party must set out, by affidavit or other evidence, specific facts that show there is a genuine issue requiring a trial (r. 20.02(2)). I am entitled to presume that the parties have put forth their best evidence on the motion and that if the case were to proceed to trial, no additional evidence would be presented (TD Waterhouse Canada Inc. (TD Waterhouse Private Investment Advice) v. Little, at para. 15, citing Rogers Cable TV Ltd. v. 373041 Ontario Ltd. (1994), 22 O.R. (3d) 25 (Gen. Div.)).

[6] Summary judgment will be appropriate where (1) I am able to make the necessary findings of fact, based on the record and my enhanced powers under rules 20.04(2.1) and 20.04(2.2); (2) I am able to apply the law to the facts; and (3) the motion process is a proportionate, more expeditious, and less expensive means to achieve a just result than going to trial (Hryniak, at para. 49).

Analysis

Findings of Fact

[7] I am able to make the necessary findings of fact, based on the record alone.

[8] The record is clear that the corporate defendants had mortgages becoming due on January 22, 2023 and February 1, 2023, that it was important to them to be able to refinance in advance of the maturity dates, and that they considered it "crucial" to avoid the default events in favour of the lenders that would be triggered if they breached their existing mortgages.

[9] It is against that backdrop that the corporate defendants and an affiliate of Morris Group entered into the Term Sheet.

[10] The Term Sheet, authored by Morris Group, describes itself as a "Letter of Offering". It establishes "Basic Conditions" that include the "negotiation, execution and delivery of definitive Loan documentation satisfactory to Lender and Borrower [the corporate defendants] each in its sole and absolute discretion". It contains "indicative terms and conditions under which one or more affiliates of Morris Group would be prepared to provide loan financing". Those indicative terms and conditions include the following:

• a. The loan amount was to be $45 million;
• b. The initial term of the loan was to be 48 months;
• c. The interest rate on the loan was to be 6%; and
• d. The advance date was to be "on or before January 31, 2023".

[11] Under the Term Sheet, the Lender is given a 60-day exclusivity period to provide the financing. BMO and First Commercial Bank of Taiwan are excluded from the exclusivity clause.

[12] The Term Sheet further provides for an origination fee of "2% of the Loan initial balance paid upon closing to" Morris Group, and a commitment fee of $175,000 that the corporate defendants "shall pay … contemporaneous [w]hen the Letter of Approval/Commitment is issued."

[13] On January 17, 2023, five weeks after the Term Sheet was signed and five days before the corporate defendants' first mortgage was to mature, Morris Group presented a potential offer for financing. The potential offer was not for the amount of loan, advance date, term of loan, or interest rate provided for in the Term Sheet.

[14] Two days later, Morris Group presented the final version of the commitment letter from the lender. It provided for the loan amount sought by the corporate defendants, but continued to fall short of the other "indicative terms and conditions": it offered a higher rate of interest (6.99%, rather than the 6% rate provided for in the Term Sheet), a shorter term of loan (36 months, rather than 48), and a later closing date for the financing (on or before February 28, 2023, rather than on or before January 31, 2023). There had previously been some discussions about the funding being provided by February 22, 2023, but Morris Group advised in late December that it could not guarantee in writing that the lender would deliver by February 22, 2023.

Application of Law to Facts

[15] I am also able to apply the law to the facts.

[16] As a preliminary matter, I find that there is no basis for a cause of action against Mr. Wakil in his personal capacity. Mr. Wakil is the director of the two corporate defendants. The Term Sheet defines "the Borrower" as the corporate defendants only. Mr. Wakil signed on their behalf in his capacity as an officer, but in doing so he was only binding the corporation. He was not taking on any personal liability.

[17] I further find that Morris Group is not entitled to the fees it claims. The offer did not trigger either of the payment obligations that Morris Group claims it did. The express language of the Term Sheet makes this clear.

The Origination Fee

[18] Morris Group seeks payment of $900,000, which appears to be the origination fee contemplated in the Term Sheet, as it is 2% of the $45 million loan contemplated. However, the Term Sheet is clear that the origination fee is equal to "2% of the Loan initial balance paid upon closing". The financing deal never closed. No funds were ever advanced to the corporate defendants. The obligation to pay the origination fee was therefore never triggered.

The Commitment Fee

[19] Morris Group also seeks payment of a commitment fee of $175,000. The Term Sheet provides that the commitment fee is to be paid "contemporaneous when the Letter of Approval/Commitment is issued". The Term Sheet does not define what the "Letter of Approval/Commitment" is. However, reading the Term Sheet as a whole, I interpret this phrase to refer to Morris Group providing an approval letter or commitment letter to the corporate defendants in respect of a proposed loan that satisfies the "indicative terms and conditions" set forth in the Term Sheet. Morris Group did not ever propose a loan to the corporate defendants that satisfied those terms and conditions. It therefore did not issue, and could not have issued, a "Letter of Approval/Commitment" as that term is reasonably interpreted. The obligation to pay the commitment fee was therefore never triggered.

Implied Terms

[20] In the alternative, I am of the view that a term is properly implied into the Term Sheet to the effect that any "Letter of Approval/Commitment" issued had to meet the requirements of the Term Sheet in order to trigger the commitment fee obligation. The Supreme Court of Canada has held that a term may be implied in a contract in the following circumstances (Canadian Pacific Hotels Ltd. v. Bank of Montreal, [1987] 1 S.C.R. 711 (at p. 775)):

(1) based on custom or usage; (2) as the legal incidents of a particular class or kind of contract; or (3) based on the presumed intention of the parties where the implied term must be necessary "to give business efficacy to a contract or as otherwise meeting the 'officious bystander' test as a term which the parties would say, if questioned, that they had obviously assumed".

[21] The objective intent of the parties under the Term Sheet was that the fee would be paid to Morris Group only if Morris Group obtained financing that met the requirements the corporate defendants had established. This understanding gives business efficacy to the Term Sheet and is consistent with the reason why the corporate defendants engaged Morris Group in the first place. Indeed, the contrary interpretation, that Morris Group simply needed to provide a loan proposal, any loan proposal, to earn the commitment fee, would yield commercially absurd results. It would suggest that even the most glaringly deficient loan proposal, one that is entirely divorced from the borrower's requirements, could trigger an obligation to pay a commitment fee.

Summary Judgment Decision

[22] I therefore find that Morris Group is not entitled to summary judgment. Based on the facts before me and my application of the law to those facts, I am unable to accept Morris Group's claim that there is no genuine issue requiring trial as to its entitlement to further payments under the Term Sheet. To the contrary, I find that there is no genuine issue requiring trial because Morris Group cannot make out its claims.

Boomerang Summary Judgment

[23] The Defendants ask for summary judgment dismissing the action against them. This type of "boomerang" summary judgment may be appropriate in cases in which "the evidence demonstrates that there is no genuine issue requiring a trial because the moving party has no case and cannot possibly succeed," (Maisonneuve v. Langlois, 2021 ONSC 3587, at para. 41).

[24] This is such a case. The parties were required, as litigants are in any summary judgment motion, to put their best feet forward. Morris Group has failed to establish that Mr. Wakil is personally liable for any claims or that it is owed any further fees under the Term Sheet. There is no genuine issue requiring trial on Morris Group's case, such that it has no case and cannot possibly succeed.

[25] I therefore dismiss both Morris Group's summary judgment motion and the action as a whole. Doing so via "boomerang" summary judgment is a proportionate, more expeditious, and less expensive means to achieve a just result in this dispute than going to trial (Hryniak, at para. 49).

Costs

[26] In exercising my discretion to fix costs under section 131 of the Courts of Justice Act, R.S.O. 1990, c. C.43, I may consider the factors enumerated in rule 57.01 of the Rules of Civil Procedure. Those factors include the result achieved, the amounts claimed and recovered, the complexity and importance of the issues in the proceeding, the principle of indemnity, the reasonable expectations of the unsuccessful party, and any other matter relevant to costs.

[27] In Apotex Inc. v. Eli Lilly Canada Inc., 2022 ONCA 587, at para. 60, the Court of Appeal for Ontario restated the general principles to be applied when courts exercise their discretion to award costs. The Court held that, when assessing costs, a court is to undertake a critical examination of the relevant factors, as applied to the costs claimed, and then "step back and consider the result produced and question whether, in all the circumstances, the result is fair and reasonable".

[28] Applying these factors here, I note, first that the Defendants are entirely successful in defending the motion, advancing their own "boomerang" summary judgment motion, and dismissing the action. They are therefore entitled to their costs based on the principle of indemnity. I am also of the view that the amounts they seek are reasonable, having regard to counsel's hourly rates and the appropriate allocation of work between junior and senior members of the counsel team. Their written materials and submissions were helpful to the court.

[29] I award the Defendants $30,000.00 in costs on a partial indemnity scale, inclusive of all taxes. In my view, this result is fair and reasonable in all the circumstances. This amount is to be paid within 30 days.

Parghi J.

Date: October 1, 2025