ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Bridgepoint Financial Services Limited Partnership I
R. Egit & S. Poinar, for the Applicant
Applicant
- and -
Rudolf Steinberg
Self-Represented
Respondent
-and-
Mark Stoiko and Masgras Professional Corporation
Respondents
L. Covens, for the Respondents Stoiko and Masgras Professional Corporation
K. Commisso & D. Somerville, for Pamela Adderley, Non-party
HEARD: December 4 & 5, 2025 in Thunder Bay, Ontario
Mr. Justice S.J. Wojciechowski
Decision on Application
Introduction
1The applicant, BridgePoint Financial Services Limited Partnership I (“BridgePoint”), seeks a determination of its entitlement for the repayment of a litigation loan which was advanced to the respondent, Rudolph Steinberg (“Mr. Steinberg”).
2Mr. Steinberg was involved in a motor vehicle accident which occurred on October 29, 2011 (“the MVA”) and involved the non-party, Pamela Adderley (“Ms. Adderley”). Mr. Steinberg sustained injuries as a result of the MVA, and sought compensation for those injuries by commencing a personal injury action (“the Tort Action”) against Ms. Adderley on January 17, 2013, in addition to advancing a claim for statutory accident benefits (“the SABS Claim”) on February 22, 2012, which were available pursuant to his motor vehicle insurance policy.
3In order to address Mr. Steinberg’s need for monetary support while he pursued his rights of compensation, including the costs of advancing the Tort Action and the SABS Claim, Mr. Steinberg entered into a loan agreement with BridgePoint (“the Loan Agreement”) and ultimately received five installments between May 2013 and December 2014 which totaled $65,500 (“the Loan”). With the application of interest to the principal amount loaned to Mr. Steinberg, as of October 9, 2024, the total amount owing to BridgePoint was $462,449.36.
4In September 2022, the Tort Action was dismissed due to Mr. Steinberg’s conduct within the litigation, without any determination whether Mr. Steinberg was entitled to compensation. No settlement was negotiated and no monies were paid to Mr. Steinberg arising from the claims in the Tort Action.
5In the same year, the SABS Claim was resolved for the all-inclusive sum of $1.25 million which was deposited into the trust account of Mr. Steinberg’s legal counsel and law firm, Mark Stoiko and Masgras Professional Corporation (“Mr. Stoiko” and “Masgras PC” respectively).
6Following the distribution of a portion of the $1.25 million SABS Claim settlement, $409,983.13 remained which was ordered to be deposited with the Accountant of the Superior Court of Justice on December 4, 2024 pending the outcome of this application.
7BridgePoint claims the Loan advanced to Mr. Steinberg should be satisfied and paid from the SABS Claim settlement.
8The other parties involved in this application – Mr. Steinberg, Ms. Adderley, Mr. Stoiko, and Masgras PC – take the position that the terms of the Loan Agreement between BridgePoint and Mr. Steinberg provide for repayment only from a settlement arising from the Tort Action. Put another way, BridgePoint is not entitled to recoup the Loan which was advanced to Mr. Steinberg from the SABS Claim settlement of $1.25 million, of which remains $409,983.13.
9Accordingly, this application seeks a consideration and interpretation of the language in the Loan Agreement between BridgePoint and Mr. Steinberg.
Background
10There are two adjudicative processes which Mr. Steinberg initiated in order to seek compensation for injuries sustained in the Motor Vehicle Accident.
11In order to support the efforts of Mr. Steinberg to seek and obtain compensation through the two adjudicative processes, a series of loan agreements as well as authorizations and directions were signed.
Two Compensatory Schemes Available
12In Ontario, there are two regimes which exist to compensate victims of motor vehicle accidents. The first is provided through mandatory insurance which responds to persons injured in a motor vehicle accident with statutory accident benefits. A variety of benefits are available to pay for services to assist the injured party post-accident, including attendant care, rehabilitation services, medical costs, housekeeping needs, and employment income replacement. The available pool of monies available to pay these benefits, and for how long, depends upon policy limits as well as the classification of the injuries sustained, i.e., minor injury, non-catastrophic, or catastrophic.
13In addition to seeking statutory accident benefits, an injured person can bring a tort action against an alleged negligent party, and seek monetary damages subject to meeting statutory thresholds and applying deductibles.
14The framework involving statutory accident benefits includes adjudication, when necessary, through an administrative tribunal system established by the Insurance Act, R.S.O. 1990, c. I.8, and its regulations.
15Damages arising from a tort action are determined through the traditional litigation system governed, in part, by the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, and the Courts of Justice Act, R.S.O. 1990, c. C. 43.
16As noted, Mr. Steinberg pursued his remedies through the SABS Claim as well as the Tort Action.
The BridgePoint Loans
17Mr. Steinberg applied for the Loan from BridgePoint on May 7, 2013. The timing of this application was after the Tort Action was commenced, and after he had initiated the SABS Claim process.
18At the time he applied for the Loan from BridgePoint, Mr. Steinberg was assisted by his lawyer, Christopher Hacio of Hacio Law (“Chris Hacio”). When completing the application, Chris Hacio provided information which was requested by BridgePoint and which detailed the status of the Tort Action and the SABS Claim. Supporting records were also provided, including the SABS Claim file as it existed at that time.
19Chris Hacio finally provided his opinion that the injuries of Mr. Steinberg would be considered “catastrophic” by his accident benefits carrier.
20Ultimately, BridgePoint approved the Loan and initially advanced $30,000 to Mr. Steinberg, and the Loan Agreement was signed by Mr. Steinberg on May 24, 2013. In addition, incorporated by reference into the Loan Agreement, was an Irrevocable Authorization and Direction (“the Direction”) also signed by Mr. Steinberg.
21Additional advances were approved over the next year and a half, with $6,000 advanced to Mr. Steinberg on September 24, 2013, $10,500 on January 27, 2014, $12,500 on May 9, 2014, and finally $6,500 on December 10, 2014. With each advance, a new set of documents were signed – loan agreements and directions – which mirrored the wording in the Loan Agreement dated May 24, 2013 as well as the Direction.
22The only material difference in the five loan agreement documents which were executed was the reference in the original document dated May 24, 2013 to monies owed to Settlement Lenders. Mr. Steinberg had borrowed monies from a previous lender to assist him with finances following his motor vehicle accident, and BridgePoint paid out that loan pursuant to the first advance of $30,000. Once the Settlement Lenders had been paid, there was no need to address the previous loan, and the four subsequent loan agreement documents did not include language relevant to the Settlement Lenders.
23In all other aspects, the language in the five loan agreement documents is identical. Accordingly, for the purposes of this decision, reference to the Loan Agreement shall include all of the documents signed by Mr. Steinberg supporting the initial and the four subsequent advances.
24The evidence of BridgePoint is that for each monetary advance to Mr. Steinberg, it was done so on the basis of the anticipated recoveries in both the Tort Action and the SABS Claim. Under the terms of the Loan Agreement, BridgePoint became a secured creditor with its security perfected under the Personal Property Security Act, R.S.O. 1990, c. P.10. The original security interest was perfected on May 30, 2013, and this has been renewed such that the current expiry date is July 17, 2026.
Relevant Terms of the Loan Agreement and the Direction
25The first paragraph of the Loan Agreement signed by Mr. Steinberg states:
FOR VALUE RECEIVED, the undersigned, Rudolf Steinberg acknowledges himself indebted and promises to pay upon the circumstances identified below to BRIDGEPOINT FINANCIAL SERVICES LIMITED I or its successors and assigns (the “Lender”), the sum of Thirty Thousand Dollars and Zero Cents ($30,000.00) of lawful money of Canada, together with interest thereon at the rate of Twenty Percent, 20.00% per annum (the “Loan”). Interest payable on monies advanced pursuant to the terms of the Loan shall be (i) compounded semi-annually, (ii) calculated from the date of each advance, (iii) where applicable, payable from the date of each advance, and (iv) payable from the proceeds of settlement and/or judicial award from any and all Borrower’s claims for damages arising out of potential or ongoing litigation, or any portion thereof, arising as a result of a Motor Vehicle Accident which took place on Saturday, October 29, 2011, and such potential or ongoing litigation includes the Statement of Claim issued in the Ontario Superior Court of Justice, Court File Number CV-13-24. Where applicable, for the purposes of this Loan Agreement, multiple claims shall be defined in the singular as, the “Claim”.
26Language in the Loan Agreement relating to the Direction includes the following:
Further, the Borrower shall execute an Irrevocable Authorization and Direction requiring the Borrower’s legal counsel . . . (“Counsel”) to immediately pay the Lender the Loan Amount plus accrued interest owing thereunder immediately upon receipt by Counsel of funds payable to the Borrower and/or Counsel, as the case may be, as a result of the settlement and/or adjudication, in whole or in part, of the Claim (the “Settlement Funds”) following the payment of legal fees, costs, disbursements, and applicable taxes directly associated with the Claim . . . .
The Borrower hereby acknowledges that this Loan is advanced on the condition that the Borrower executes an Irrevocable Authorization and Direction addressed to Counsel to directly pay the Lender from the Settlement Funds the amount owing on the Loan together with interest as agreed herein without regard to the nature or timing of the settlement and/or adjudication of separate claims by the Borrower. The irrevocable Authorization and Direction is incorporated by reference into this Loan Agreement. As stated above, the Borrower acknowledges and agrees that he shall not be entitled to receive any portion of the Settlement Funds until the Loan has been fully repaid.
27The Direction also signed by Mr. Steinberg authorizes, directs and instructs his lawyer:
. . . that upon settlement and/or adjudication of any and all of my claims for damages, arising out of potential or ongoing litigation, or any part thereof, arising as a result of a Motor Vehicle Accident which occurred on Saturday, October 29, 2011 and such potential or ongoing litigation includes the Statement of Claim issued in the Ontario Superior Corut of Justice, Court File Number CV-13-24, to pay the above noted Lender from such proceeds (“Settlement Funds”) . . . .
28Finally, the security interest language within the Loan Agreement reads as follows:
As continuing collateral for the due timely payments and performance by the Borrower of the Borrower’s obligations under this Loan Agreement, the Borrower hereby […] grants to the Lender a general and continuing security interest in the Settlement Funds and in the Borrower’s claims that may give rise to the Settlement Funds.
Issues to be Determined
29Essentially, with a security interest over any Settlement Funds received by Mr. Steinberg, the issue at the heart of this application is whether the monies paid as a result of the SABS Claim are Settlement Funds pursuant to the terms of the Loan Agreement.
30Put another way, is the term Settlement Funds in the Loan Agreement restricted to monies paid to resolve the Tort Action, or does this term also include the monies which were paid to Mr. Steinberg in order to resolve the SABS Claim?
31BridgePoint asserts that the Loan Agreement contemplates a secured interest in the monies held by the Accountant of the Superior Court of Justice in that these monies were obtained as a result of the SABS Claim being resolved and settled.
32The other parties – Ms. Adderley, Mr. Stoiko and Masgras PC – assert that the term Settlement Funds under the Loan Agreement only refers to any monies paid to resolve the Tort Action. They dispute the position of BridgePoint that its Loan Agreement was meant to secure monies paid in order to resolve the SABS Claims as well as the Tort Action. Accordingly, BridgePoint does not have a security interest in the monies held by the Accountant of the Superior Court of Justice, and instead stands in the same shoes as other creditors of Mr. Steinberg.
Legal Considerations
Interpreting the Language of Contracts
33In order to determine the meaning of a contract, a Court must consider the intent of the parties and underlying context and surrounding circumstances at the time the contract was formed. Objectively, what is the scope of their understanding of the intent of the contract?
34The entirety of a contract must be read applying ordinary and grammatical meaning to the terms in the contract, which are consistent with the reasonable expectations of the parties at the time the contract was made.
35The interpretation of the Court should achieve harmony between all provisions and words of the document with the purpose behind the contract’s creation: See Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, at paras. 46-50; Jesuit Fathers of Upper Canada v. Guardian Insurance Co. of Canada, 2006 SCC 21, at paras. 27-29; and Tercon Contractors Ltd. v. B.C. (Transportation and Highways), 2010 SCC 4, [2010] 1 S.C.R. 69, at para. 64.
36Sattva Capital goes further and explains the purpose of surrounding circumstances as being an interpretive aid to determine the meaning of the words chosen by the parties and set out in the contract. Surrounding circumstances are those facts which parties know, or ought to have known, and provide the context for the formation of the contract: see para. 60.
37The Court of Appeal for Ontario’s approach which reflects the cases cited above is referenced in H.Z. v. Upper Canada College, 2022 ONSC 4622, at para. 48, with the following:
48The Court of Appeal has held that when interpreting a contract, a judge should:
a. determine the intention of the parties in accordance with the language they have used in the written document, based upon the "cardinal presumption" that they intended what they said;
b. read the text of the written agreement as a whole, giving the words used their ordinary and grammatical meaning, in a manner that gives meaning to all of the agreement’s terms and avoids an interpretation that would render one or more of its terms ineffective;
c. read the contract in the context of the surrounding circumstances known to the parties at the time of its formation. The surrounding circumstances, or factual matrix, include facts that were known or reasonably capable of being known by the parties when they entered into the written agreement, such as facts concerning the genesis of the agreement, its purpose, and the commercial context in which it was made. However, the factual matrix cannot include evidence about the subjective intention of the parties; and
d. read the text in a fashion that accords with sound commercial principles and good business sense, avoiding a commercially absurd result, objectively assessed.
50Finally, when determining the intentions of the parties, the court is not concerned with the parties’ subjective intentions at the time they drafted the contract, but rather with the intent expressed in the written words of the contract and the context in which they used them: Dumbrell v. The Regional Group of Companies Inc., 2007 ONCA 59, 85 O.R. (3d) 616, at para. 50.
38There is no doubt that damages claimed within a Tort Action are distinct from the benefits sought within the SABS Claim, and are independent of one another: see Cadieux v. Cloutier, 2018 ONCA 903, at para. 17. Damages sought in a personal injury litigation matter arise in tort. Benefits sought as accident benefits as provided by statutory insurance policy language arise in contract: Mujagic v. State Farm Automobile Insurance Company (2009), 2009 CanLII 9424 (ON SC), 95 O.R. (3d) 624, at para. 65.
39Notwithstanding these distinctions, the question in the present case is whether the language in the Loan Agreement, interpreted in accordance with the above principles, was intended by the parties to the Loan Agreement to secure monies arising from the SABS Claim and the Tort Action.
BridgePoint’s Analysis of the Loan Agreement
40BridgePoint maintains that the term “Settlement Funds” in the Loan Agreement includes any monies derived from the Tort Action and/or the SABS Claim.
41The term “Settlement Funds” is referenced on the second page of the Loan Agreement as “funds payable to [Mr. Steinberg] . . . as a result of the settlement and/or adjudication, in whole or in part, of the Claim”.
42“Settlement Funds” is also described in the Direction as being “proceeds” derived from:
. . . settlement and/or adjudication of any and all [Mr. Steinberg’s] claims for damages, arising out of potential or ongoing litigation, or any part thereof, arising as a result of a Motor Vehicle Accident which occurred on Saturday, October 29, 2011 and such potential or ongoing litigation includes the Statement of Claim issued in the Ontario Superior Court of Justice, Court File Number CV-13-24 . . .
43Back to the Loan Agreement, “Claim” is defined to include both a single claim as well as multiple claims, and can include, where applicable, more than one claim. This is stated at the end of the first paragraph of the Loan Agreement.
44There is no additional definition provided for the term “Claim” beyond the assertion that it includes “multiple claims”.
45The term “claims” is then referenced – not specifically defined – in the first paragraph of the Loan Agreement when describing from what source and from where the interest on monies advanced pursuant to the terms of the Loan Agreement is payable.
Interest . . . shall be . . . (iv) payable from the proceeds of settlement and/or judicial award from any and all Borrower’s claims for damages arising out of potential or ongoing litigation, or any portion thereof, arising as a result of a Motor Vehicle Accident which took place on Saturday, October 29, 2011, and such potential or ongoing litigation includes the Statement of Claim issued in the Ontario Superior Court of Justice, Court File Number CV-13-24.
46None of the parties to this hearing disputed the assertion that monies received as a settlement from the Tort Action were Settlement Funds caught by the terms of the Loan Agreement and Direction. This position is rooted in the specific reference to the court file number in the Tort Action.
47Again, as noted above, the Tort Action was dismissed without any monies being paid to Mr. Steinberg.
48BridgePoint maintains that the same language in the Loan Agreement and Direction which identifies Settlement Funds from the Tort Action also includes any Settlement Funds received pursuant to the SABS Claim.
49Settlement Funds are those monies payable due to the settlement and/or adjudication, in whole or in part, of the Claim. Additionally, Settlement Funds are proceeds derived from the settlement and/or adjudication of any and all [Mr. Steinberg’s] claims for damages, arising out of potential or ongoing litigation, or any part thereof, arising as a result of the MVA.
50The SABS Claim was advanced on account of the MVA. It was resolved, and monies were paid to Mr. Steinberg, through his legal counsel, in the amount of $1.25 million. These are therefore proceeds arising from the settlement of the claims for damages advanced by Mr. Steinberg within the SABS Claim, and are therefore governed by the terms of the Loan Agreement.
51BridgePoint also argues that the language used makes it clear that the term “Claim” includes the SABS Claim. Settlement Funds are proceeds derived from “the settlement and/or adjudication of any and all . . . claims for damages” arising from the MVA. If the Loan Agreement and Direction were only meant to apply to a settlement of the Tort Action, there would be no need to include the “and/or” language which contemplates two different proceedings. The use of the conjunction “and” would only be necessary if there were more than one claim, and inserting this term necessarily results in a determination that the terms of the Loan Agreement were not reserved simply to the Tort Action which is specifically referenced.
52In addition, applying the directions from the Supreme Court of Canada and the Court of Appeal for Ontario, the context and background to the agreement between Mr. Steinberg and BridgePoint are relevant to interpreting the language in the Loan Agreement and Direction.
53BridgePoint’s evidence on this application included the affidavit of Stephen Pauwels which was affirmed December 17, 2024. Stephen Pauwels identifies himself as a principal and co-founder of BridgePoint, and provides general information relating to the Loan advanced by BridgePoint, in addition to evidence gleaned from reviewing BridgePoint’s file with respect to the loan advances provided to Mr. Steinberg.
54Stephen Pauwels explained that loans are offered to individuals for the purposes of enabling plaintiffs to pay for basic living expenses, medical, rehabilitation and attendant care, and related products and services pending the resolution of a claim arising from a personal injury.
55At the time of the Loan Agreement, while Mr. Steinberg had a previous litigation loan through another company, BridgePoint and Mr. Steinberg had never done business together in the past.
56As part of the application process, Mr. Steinberg provided BridgePoint – through his legal counsel – records and particulars addressing the tort and accident benefit claims of Mr. Steinberg, including a copy of his accident benefits file. If there was no intention for the Loan Agreement to cover any settlement of the SABS Claim, why were the details, and Mr. Steinberg’s accident benefits file, provided to BridgePoint before the Loan Agreement was approved by BridgePoint and signed by Mr. Steinberg?
57Based upon the information provided, the Loan was approved by BridgePoint on the following basis:
As a result of this conversation [with Chris Hacio], the loan was approved. BridgePoint assessed the loan based on anticipated recoveries in both the accident benefit and tort files. There was no distinction between recovery from the accident benefit and tort claims. BridgePoint understood the loans were secured against all claims arising from the accident.
58Aside from differences in the amounts advanced and the applicable rate of interest, Stephen Pauwels’ evidence supports that the terms of each advance were identical, including that each stage of the Loan was based on recoveries from both the tort and accident benefits claims.
59Stephen Pauwels also provides evidence with respect to communications between BridgePoint and counsel for Mr. Steinberg once the settlement of the SABS Claim was reached with Mr. Steinberg’s accident benefits carrier. This includes the following:
Mr Steinberg paid $70,000 to BridgePoint from the SABS Claim settlement to be credited to the monies owed to BridgePoint.
Mr. Steinberg’s counsel wrote to BridgePoint seeking BridgePoint’s consent to release $500,000 to Mr. Steinberg from the SABS Claim settlement.
BridgePoint stated that funds could be advanced to Mr. Steinberg as long as the remaining balance could cover the monies owed pursuant to the Loan Agreement.
60BridgePoint takes the position that Mr. Steinberg’s use of the SABS Claim settlement to pay a portion of BridgePoint’s loan is indicative of Mr. Steinberg’s intention to recognize the SABS Claim settlement as part of the Loan Agreement.
61Similarly, BridgePoint points to the fact that Mr. Steinberg’s legal counsel sought BridgePoint’s consent to disburse monies to Mr. Steinberg from the SABS Claim settlement would only have been done if Mr. Steinberg recognized these monies were Settlement Funds as defined by the Loan Agreement.
Arguments Contrary to BridgePoint’s Position
62The responding submissions to the analysis presented by BridgePoint came from Mr. Steinberg, Mr. Stoiko and Masgras PC, as well as Ms. Adderley.
Rudolph Steinberg
63Mr. Steinberg did not file any evidence in his response to BridgePoint’s position. He also did not retain legal counsel, but instead enlisted support from his son, Jakob Steinberg, who made submissions on his behalf.
64Jakob Steinberg relied upon a former endorsement of Warkentin J. which outlined various steps to be taken before entitlement to the SABS Claim settlement could be determined. Because these steps were not taken, his submission was that this Court did not have jurisdiction to entertain BridgePoint’s application.
65In addition, Jakob Steinberg argued that being a SABS Claim settlement, s. 62(1) of the Statutory Accident Benefits Schedule, O. Reg. 34/10 applies, and which provides that any assignment of accident benefits is void.
66In briefly addressing these points, I note that while Warkentin J. made a number of case management orders in this matter, after she retired from the bench, the litigation between all parties involved in this application was case managed by myself. Despite any previous endorsements of the Court, all of which were considered in subsequent case management hearings, the process which led to BridgePoint’s application and this hearing were endorsed and prescribed, thus clothing this Court with full jurisdiction to decide this application.
67With respect to the accident benefits’ regulation which precludes assignment, no assignment of Mr. Steinberg’s SABS Claim was created by the Loan Agreement. I agree with BridgePoint’s submissions that no formal assignment was created, and instead Mr. Steinberg granted BridgePoint a security interest in Settlement Funds under the Loan Agreement.
68If it were otherwise, and an assignment was created, then BridgePoint would have been entitled to receive monthly or periodic payments of accident benefits directly from Mr. Steinberg’s accident benefit insurer. If it were otherwise, then Mr. Steinberg’s accident benefit insurer would have been obligated to pay the settlement of the SABS Claim directly to BridgePoint instead of Mr. Steinberg’s legal counsel.
69Accordingly, I did not find Mr. Steinberg’s arguments to be persuasive.
Pamela Adderley
70The submissions on behalf of Ms. Adderley asserted that the term “Claim” in the Loan Agreement refers to “claims for damages”. Because benefits paid pursuant to an accident benefits claim are benefits, not damages, the term Settlement Funds does not include monies paid to resolve the SABS Claim.
71In any event, any security interest which is referenced in the Loan Agreement cannot apply to the monies paid to settle the SABS Claim because s. 11 of the Personal Property and Security Act, R.S.O. 1990, c. P.10 (“PPSA”) requires any collateral, which is made subject to a security interest, be sufficiently described and identified. Since there is ambiguity in the term “Settlement Funds” as to whether or not it includes the SABS Claim settlement, the operation of s. 11 naturally excludes the SABS Claim settlement.
72Clearly the Loan Agreement references the settlement from the Tort Action, and any monies paid to Mr. Steinberg in that regard would be subject to a security interest. But without the clarity required by s. 11 of the PPSA, the monies paid to resolve the SABS Claim cannot form part of the collateral which is subject to a security interest.
73In considering the submissions of Ms. Adderley, the arguments with respect to clarity are wrapped up in the first submission addressing benefits versus damages. Either the Loan Agreement meant to secure the settlement from the SABS Claim or it did not.
74Settlement Funds are interpreted to include any resolution of the Tort Claim, and a security interest exists with respect to those monies as per the Loan Agreement. No party to this application disputed this interpretation. As such, if the term Settlement Funds is determined to include the SABS Claim settlement, then by the same reasoning, sufficient clarity exists to create a security interest.
75The issue of clarity does not arise simply because this hearing was necessary in order to sort out whether the SABS Claim settlement could be included as collateral, and thus secured. It is either part of Settlement Funds, or it is not, and on this basis, the arguments of Ms. Adderley will be considered in the context of the arguments advanced by the other parties on this issue.
Mark Stoiko and Masgras Professional Corporation
76Reflecting similarities in the arguments advanced by Ms. Adderley, Mr. Stoiko and Masgras PC take the position that accident benefits are benefits, not damages, and the Loan Agreement only claims a secured interest in damages.
77Notwithstanding the position of BridgePoint that it sought and obtained information relating to the SABS Claim before drafting the Loan Agreement, there is no specific reference to settlements from the SABS Claim when attempting to describe Settlement Funds. On the other hand, specific reference to the Tort Action – with a description of the court hearing the matter and the court file number – is used to describe the term Settlement Funds. Thus, clearly the intention of BridgePoint – who drafted the Loan Agreement – and Mr. Steinberg – who signed the Loan Agreement – was to create a security interest over any monies paid to settle the Tort Action and not the SABS Claim.
78The doctrine of contra proferentem applies in this regard to the Loan Agreement which was drafted by BridgePoint.
79The statutory and regulatory framework applicable to accident benefits speaks in terms of “benefits” when describing the claims an insured can advance and an accident benefits carrier has to pay.
80Contrast that with the language in the statement of claim issued by Mr. Steinberg against Ms. Adderley – the Tort Action – which clearly refers to various claims for damages, including general, special, and pecuniary damages, past and future health care costs, and the loss of handyman, housekeeping and homecare capacities.
81No court action and no claim for damages was ever advanced or issued by Mr. Steinberg in order to support his attempts to secure accident benefits.
82Citing Shewchuk v. Blackmont Capital Inc., 2016 ONCA 912, at para. 46, it was submitted that post-contract conduct is irrelevant to the consideration of context and background, save and except where the contract language is ambiguous. Accordingly, Mr. Stoiko and Masgras PC take issue with the arguments of BridgePoint that the conduct of Mr. Steinberg and his legal counsel following payment of the settlement of the SABS Claim is relevant to the interpretation of the Loan Agreement.
83There are a number of claims for damages available to an injured plaintiff which rely upon various tort theories of liability. This includes the basis for the Tort Action, but could also include pursuing a third party for negligent driving, or for vicarious liability relating to an accident, or against a municipality for negligent road design or maintenance, or a motor vehicle manufacturer for negligent design. The term “Claim”, which involves multiple claims by the terms of the Loan Agreement, could include these other actionable claims, and does not mandate an interpretation of the “and/or” conjunction to only support a reference to the Tort Action “and” the SABS Claim.
84Instead, being created and signed in the early stages of Mr. Steinberg’s litigation, the Loan Agreement used the “and/or” language to anticipate further tort claims being advanced once additional facts and evidence were obtained.
85With respect to evidence filed by BridgePoint, the affidavit of Stephen Pauwels asserts that all advances of funds to Mr. Steinberg were made on the basis of BridgePoint’s assessment which included anticipated recoveries in both the SABS Claim and the Tort Action, without distinction. However, Mr. Stoiko and Masgras PC assert that this evidence is only Stephen Pauwel’s subjective interpretation of the Loan Agreement, and not the objective interpretation required by the caselaw.
86While Stephen Pauwels’ references the underwriting file and the file of BridgePoint, no such evidence has been produced despite specific requests for same. Two emails were sent from counsel for Mr. Stoiko and Masgras PC to counsel for BridgePoint, one on December 22, 2024 and a second on January 13, 2025, and neither request for documents was answered.
87In that Stephen Pauwels may be a principal of BridgePoint, he was not the one who wrote nor negotiated the Loan Agreement with Mr. Steinberg. His name does not appear on the Loan Agreement nor the Direction, and as such his evidence is hearsay and does not constitute the best evidence available.
88Accordingly, failing to provide evidence from the individual within BridgePoint who actually negotiated the Loan Agreement with Mr. Steinberg, and without providing the actual records, notes and files which were generated at the time the Loan Agreement was executed, raises the basis for making an adverse inference against BridgePoint.
Decision
89My review of the Loan Agreement and surrounding circumstances leads me to the conclusion that Settlement Funds only include monies paid to resolve the Tort Action, and does not include the settlement of the SABS Claim.
Language of Loan Agreement
90In reviewing the terms of the Loan Agreement, the initial reference to “proceeds of settlement” is found in the first paragraph which describes the monetary source from which interest is payable. A plain reading of this first paragraph indicates that interest is payable from Mr. Steinberg’s “claims for damages”. Damages arising from a tort claim and pursued through litigation – including the specific litigation referenced as Court File Number CV-13-24 in the Superior Court of Justice – are distinct from benefits received as accident benefits by a party injured in a motor vehicle accident.
91There are two possible ways in which to interpret the language used in this first paragraph.
92Interest could be payable from:
(i) the proceeds of settlement, and/or
(ii) a judicial award from any and all Borrower’s claims for damages arising out of potential or ongoing litigation, or any portion thereof,
arising as a result of a Motor vehicle Accident which took place on Saturday, October 29, 2011.
93Alternatively, interest could be payable from:
(i) the proceeds of settlement, and/or
(ii) a judicial award
from any and all Borrower’s claims for damages arising out of potential or ongoing litigation, or any portion thereof, arising as a result of a Motor vehicle Accident which took place on Saturday, October 29, 2011.
94The first interpretation would be more in line with Settlement Proceeds including monies from the SABS Claim in that proceeds of settlement would not be further interpreted with the term “claims for damages” which is what the second interpretation provides.
95However, based upon a consideration of all the factors, including the wording of the Loan Agreement and the Direction, the overall context and background of these documents, and the evidence presented during this hearing, I adopt the second interpretation. In that interpretation, “proceeds of settlement” and “judicial award” are both derived from “claims for damages”.
96With this interpretation, the defined term of “Settlement Funds” as that appears in the Loan Agreement is linked to the settlement and/or adjudication of the Claim, which term is defined in the first paragraph of the Loan Agreement as “claims for damages”.
97This coincides with the language in the Direction, which describes the term “Settlement Funds” as proceeds from the settlement and/or adjudication of any and all claims for damages, arising from potential or ongoing litigation arising from the MVA of October 29, 2011. In addition, BridgePoint inserted language to make it clear to the reader that potential and ongoing litigation included Court File CV-13-24 in the Superior Court of Justice.
98The additional language following the portion of the Loan Agreement replicated above and which further supports my interpretation is the sentence following “Saturday, October 29, 2011”, which provides “and such potential or ongoing litigation includes the Statement of Claim issued in the Superior Court of Justice, Court File Number CV-13-24”.
99Referencing the two possible interpretations again, with the additional sentence, they would be considered with the following constructions:
Interest could be payable from:
(i) the proceeds of settlement, and/or
(ii) a judicial award from any and all Borrower’s claims for damages arising out of potential or ongoing litigation, or any portion thereof,
arising as a result of a Motor vehicle Accident which took place on Saturday, October 29, 2011, and
(iii) in the reference in (ii) to “potential or ongoing litigation”, such potential or ongoing litigation includes the Statement of Claim issued in the Superior Court of Justice, Court File Number CV-13-24.
Alternatively, interest could be payable from:
(i) the proceeds of settlement, and/or
(ii) a judicial award
from any and all Borrower’s claims for damages arising out of potential or ongoing litigation, or any portion thereof, arising as a result of a Motor vehicle Accident which took place on Saturday, October 29, 2011, and such potential or ongoing litigation includes the Statement of Claim issued in the Superior Court of Justice, Court File Number CV-13-24.
100Again, the first interpretation which BridgePoint proposes as applicable requires contortions in the paragraph’s structure which no reasonable reader could envision. The second is a much more natural approach to reading and comprehending the language of the Loan Agreement.
101My conclusions in this regard are founded, in part, by the application of the contra proferentem doctrine, which requires any ambiguities in a contract be construed against the drafter: see Jesuit Fathers, at para. 28.
102The Loan Agreement either provides for interest arising from the monies advanced to be payable from the proceeds of settlement arising from the MVA, or payable from the proceeds of settlement from Mr. Steinberg’s claims for damages arising from litigation commenced due to the MVA.
103With two interpretations, ambiguity exists, and the version of the contract language which is more favourable to Mr. Steinberg prevails.
104The ambiguity is furthered clarified by the words which specifically describe the litigation commenced in the Superior Court of Justice.
105First, no reference to the SABS Claim is made, which BridgePoint obviously could have included in the Loan Agreement but decided against doing so. The evidence of BridgePoint is clear that it requested and received the SABS Claim file from Mr. Steinberg’s counsel before drafting the Loan Agreement. BridgePoint submits that this is evidence which supports its position that the Loan was only advanced on the strength of the SABS Claim, and therefore the SABS Claim was included in the term Claim which resulted in Settlement Funds. However, the evidence supports that the SABS Claim file was provided at an early stage in Mr. Steinberg’s litigation against Ms. Adderley, and a reasonable inference is that this file and Chris Hacio’s opinion that Mr. Steinberg’s injuries were “catastrophic” in the context of the SABS Claim, were used to assess the strength of the Tort Claim.
106If an injured party is deemed to be “catastrophic” by an accident benefits carrier, that speaks to the injuries sustained by the plaintiff and the value of any tort claim which is advanced. Insurance statutes and regulations create a scheme of deductibles and thresholds in MVA claims which prescribe and limit a plaintiff’s ability to pursue damages. Knowing whether or not a plaintiff is injured to the extent that he or she may be deemed to be “catastrophic” is a significant factor which would have allowed BridgePoint to assess the value and strength of the Tort Action.
107BridgePoint requested information in support of the SABS Claim. BridgePoint obtained a legal assessment of the strength of Mr. Steinberg’s SABS Claim. BridgePoint then drafted a Loan Agreement, and made a point of specifically describing the Tort Action, while not including any reference to the SABS Claim.
108The reasonable inference in this regard is that BridgePoint did not intend to rely upon any potential settlement of the SABS Claim. If it were otherwise, then BridgePoint – being a sophisticated provider of litigation loans and understanding the nature of potential settlements available to any party injured by a motor vehicle accident – would have referenced the SABS Claim in a similar fashion as it did the Tort Action.
109It would also have been reasonable for Mr. Steinberg, after disclosing the details of his SABS Claim and his Tort Action, to see a legal document only referencing the Tort Action to assume that only the Tort Action was being submitted as collateral for the Loan Agreement and not the SABS Claim.
110The wording of the Loan Agreement, when considered in the context of the Loan Agreement’s formation, can only be harmoniously interpreted such that Settlement Funds were meant to only include the Claim in the Tort Action.
111My assessment of the background and context is also based on the nature of the evidence provided in this matter. I agree with the position advanced by counsel for Mr. Stoiko and Masgras PC with respect to the frailties of the affidavit evidence submitted by Stephen Pauwels.
112Stephen Pauwels had nothing to do with the negotiation and signing of the Loan Agreement. While knowledgeable in the business of BridgePoint as a principal, his affidavit evidence does not suggest any personal involvement in this matter. Accordingly, his assertions of what happened are presumably based on the general practices of BridgePoint or what was in BridgePoint’s file relating to Mr. Steinberg, without any distinction between the two sources of information.
113In that the assessment of the Loan Agreement insofar as context and background must be an objective exercise, there exists valid criticism of BridgePoint’s evidence since it is based upon the subjective interpretation of supporting documents put forth by Stephen Pauwels.
114And while it may be that the interpretation was not entirely subjective, this is not possible to assess without production of the source documents apparently reviewed by Stephen Pauwels.
115An unidentified Assessment Officer of BridgePoint was the lead in discussions with Mr. Steinberg before the Loan Agreement was drafted and signed. There is an underwriting file, and a BridgePoint file, which was created – in whole or in part – by this Assessment Officer. However, the evidence of Stephen Pauwels is not based upon information and belief derived from conversations with the Assessment Officer. Nor is the BridgePoint file which was created in support of the Loan Agreement produced, notwithstanding two separate emails sent within the context of this hearing seeking production of BridgePoint’s underwriting file, logs, notes, and Assessment Officer reports.
116A party must put their best foot forward when addressing contentious issues which are before the Court, failing which little or no weight will be given to the evidence: see R.S.J. Macleod’s decision in Glasjam Investments Ltd. v. Freedman, 2014 ONSC 3878, at paras. 32-33, and Beaudoin J.’s reasons in Canadian Blood Services v. Freeman, 2004 CanLII 35007 (Ont. S.C.), both cited at paras. 82-83 of Re Saskin, 2023 ONSC 4695.
117By not proffering evidence from the Assessment Officer involved in the creation of the Loan Agreement, the interpretation of the Loan Agreement with application of the principles from Sattva Capital is compromised, if not entirely thwarted. The objectivity of the evidence from Stephen Pauwels is called into question absent no explanation on why the best evidence was not filed, including relevant documents.
118This further supports my findings that Settlement Funds do not include the resolution of the SABS Claim.
119In terms of considering the post-contract conduct of Mr. Steinberg and his legal counsel, while urged to find this supports BridgePoint’s interpretation of the Loan Agreement, I find that no ambiguity results from my analysis which permits consideration of this post-contract conduct.
120The conduct in this regard, as already noted in these reasons, is the partial payment of the Loan from the proceeds of the SABS Claim, and the request of Mr. Steinberg’s counsel for BridgePoint’s consent to distribute funds from the SABS Claim settlement.
121In Shewchuk, at para. 46, Strathy C.J.O. expressed concern with a court’s consideration of post-contract conduct. There could be any number of reasons to explain a party’s conduct which are unrelated to the context within which a contract was signed. This seems especially relevant in this case when the post-contract conduct of Mr. Steinberg is approximately 12 years following the date of the initial Loan Agreement.
122More to the point, however, is Strathy C.J.O.’s direction that “[e]vidence of subsequent conduct should be admitted only if the contract remains ambiguous after considering its text and its factual matrix”: at para. 46.
123My findings reflect no ambiguity remaining once the language of the Loan Agreement is considered in its entirety, and in the context of the factual matrix within which the Loan Agreement was signed. Absent any ambiguity as to the terms of the Loan Agreement, once these factors are considered, there is no reason, nor ability, to consider post-contract conduct.
Conclusion
124The application of BridgePoint is dismissed, and I find that no security interest exists with respect to the settlement of the SABS Claim, including those monies currently held by the Accountant of the Superior Court of Justice.
125If any party wishes to advance a claim for costs with respect to this proceeding, they may do so within 20 days of this decision by providing submissions not more than 5 pages, double spaced, plus attachments including a bill of costs. Responding submissions in the same format may also be submitted within 35 days of the date of this decision.
126To the extent that the parties are unable to agree on the distribution of the monies currently held by the Accountant of the Superior Court of Justice, they may seek a further appearance before me for directions.
The Hon. Justice S.J. Wojciechowski
Released: June 3, 2026