Callidus Capital Corporation v. Pagotto

Callidus Capital Corporation v. Pagotto

The guarantee, properly construed, authorized assignment without the guarantors' consent; the assignment to Asset did not constitute a material change in the guarantors' obligations; there was no credible evidence the court‑approved insolvency sale occurred at less than fair market value or that appellants suffered...

Source-derived case information.

Citation
2011 ONCA 777
Parties
Plaintiff (respondent): Asset Engineering LP; Defendant/appellant; Plaintiff by Counterclaim (appellant): John Pagotto; Defendant/appellant; Plaintiff by Counterclaim (appellant): Philip Woodard; Defendant/appellant; Plaintiff by Counterclaim (appellant): Paul Walker; Respondent; Assignee/lender: Callidus Capital Corporation; Defendant by Counterclaim (respondent): Carpe Diem Real Estate Development Inc. c.o.b. as Carpe Diem Growth Capital; Defendant by Counterclaim (respondent): Sher-Wood Hockey Inc.; Defendant by Counterclaim (respondent): Dean Topolinski
Court
Court of Appeal for Ontario
Jurisdiction
Canada
Judgment Date
1 May 2012
Procedural Posture
Appeal From Summary Judgment in Civil Collection and Insolvency Proceedings / Court of Appeal Decision on Motion for Summary Judgment and Related Counterclaims (appeal)
Outcome
Appeal dismissed; judgment below upheld
Legal Topics
Assignability of Guarantees, Consent to Assignment, Material Change Doctrine, Summary Judgment/prematurity, Court Approved Insolvency Sales, CCAA Restructuring, Pleading Standards for Conspiracy
Source Language
english
Contract Insolvency Civil Procedure Guarantees and Suretyship Assignment of Rights Tort Conspiracy Assignability of Guarantees Consent to Assignment +5 more

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Parties

Asset Engineering LP

Plaintiff (respondent)

John Pagotto

Defendant/appellant; Plaintiff by Counterclaim (appellant)

Philip Woodard

Defendant/appellant; Plaintiff by Counterclaim (appellant)

Paul Walker

Defendant/appellant; Plaintiff by Counterclaim (appellant)

Callidus Capital Corporation

Respondent; Assignee/lender

Carpe Diem Real Estate Development Inc. c.o.b. as Carpe Diem Growth Capital

Defendant by Counterclaim (respondent)

Sher-Wood Hockey Inc.

Defendant by Counterclaim (respondent)

Dean Topolinski

Defendant by Counterclaim (respondent)

Procedural Posture

Appeal From Summary Judgment in Civil Collection and Insolvency Proceedings / Court of Appeal Decision on Motion for Summary Judgment and Related Counterclaims (appeal)

Legal Issues

  1. 1 Whether the guarantee could be assigned without guarantors' consent
  2. 2 Whether the assignment to Asset constituted a material change in the guarantors' obligations
  3. 3 Whether the conspiracy/civil claim raised a triable issue of sale below fair market value and resulting damages

Ratio Decidendi

The guarantee, properly construed, authorized assignment without the guarantors' consent; the assignment to Asset did not constitute a material change in the guarantors' obligations; there was no credible evidence the court‑approved insolvency sale occurred at less than fair market value or that appellants suffered damages from any alleged conspiracy; and the summary judgment motion was not premature because appellants failed to use available procedural mechanisms to obtain the missing evidence. Therefore judgment on the guarantee and dismissal of the counterclaims were correct and the appeal is dismissed.

Court Disposition

Appeal dismissed; judgment below upheld

Orders

  • Judgment entered against the appellants on the guarantee
  • Counterclaims dismissed (including conspiracy claim against Asset and assignment claim against Callidus)