Royal Building Supplies Ltd. v. Tabrco Management Ltd.

Royal Building Supplies Ltd. v. Tabrco Management Ltd.

The appeal was dismissed because the motion judge correctly concluded on summary judgment that the appellant offered no evidentiary basis for his asserted conditional payment defence and, as a matter of law, a debtor's bankruptcy does not release a guarantor from liability for pre-bankruptcy indebtedness absent clear, express wording in the guarantee to that effect.

Citation
2007 ONCA 107
Parties
Plaintiff/respondent: Royal Building Supplies Ltd.; Defendant/appellant: Tabrco Management Ltd.; Defendant/appellant: Brian T. Brennan
Court
Court of Appeal for Ontario
Jurisdiction
Canada
Judgment Date
20 February 2007
Procedural Posture
Civil / Appeal From Summary Judgment Decision
Outcome
Appeal dismissed with costs
Legal Topics
Summary Judgment, Guarantee Liability, Effect of Debtor Bankruptcy on Guarantor, Credibility Findings on Summary Judgment, Costs
Source Language
English
Contract Bankruptcy Civil Procedure Summary Judgment Guarantee Liability Effect of Debtor Bankruptcy on Guarantor Credibility Findings on Summary Judgment Costs

Case Brief

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Parties

Royal Building Supplies Ltd.

Plaintiff/respondent

Tabrco Management Ltd.

Defendant/appellant

Brian T. Brennan

Defendant/appellant

Procedural Posture

Civil / Appeal From Summary Judgment Decision

Legal Issues

  1. 1 Whether the motion judge impermissibly made findings of credibility on a summary judgment motion
  2. 2 Whether the bankruptcy/assignment of Tabrco suspended or discharged the guarantor's liability
  3. 3 Whether the wording of the guarantee expressly released the guarantor upon the debtor's bankruptcy

Ratio Decidendi

The appeal was dismissed because the motion judge correctly concluded on summary judgment that the appellant offered no evidentiary basis for his asserted conditional payment defence and, as a matter of law, a debtor's bankruptcy does not release a guarantor from liability for pre-bankruptcy indebtedness absent clear, express wording in the guarantee to that effect.

Court Disposition

Appeal dismissed with costs

Orders

  • Appeal dismissed
  • Summary judgment against the appellant affirmed