Royal Bank of Canada v. Everest Group Inc.

Royal Bank of Canada v. Everest Group Inc.

The motion judge correctly found that the corporate appellants ceased to carry on business when they returned restaurant operations to the franchisor, which constituted events of default and authorized the respondent to demand repayment; there was no error in the motion judge’s exercise of discretion including refusal to adjourn, therefore summary judgments were properly granted.

Citation
2019 ONCA 287
Parties
Plaintiff (respondent): Royal Bank of Canada; Defendant (appellant): Everest Group Inc.; Defendant (appellant): Yousaf Jamell Khan; Defendant (appellant): Zarmina S. Khan; Defendant (appellant): Shahid Saleem Khawaja; Defendant (appellant): Versatile Holdings Inc.; Defendant (appellant): Sardar Samiuddin Khan; Defendant (appellant): Nida Shahid; Defendant (appellant): Shaid Saleem Khawaja
Court
Court of Appeal for Ontario
Jurisdiction
Canada
Judgment Date
9 April 2019
Procedural Posture
Collection / Appeal From Summary Judgment
Outcome
Appeals dismissed; summary judgments upheld
Legal Topics
Summary Judgment, Events of Default, Guarantee, Rescission of Franchise Agreement, Adjournment, Exercise of Contractual Discretion
Source Language
English
Civil Commercial Law Franchise Law Contract Law Debt Collection Summary Judgment Events of Default Guarantee +3 more

Case Brief

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Parties

Royal Bank of Canada

Plaintiff (respondent)

Everest Group Inc.

Defendant (appellant)

Yousaf Jamell Khan

Defendant (appellant)

Zarmina S. Khan

Defendant (appellant)

Shahid Saleem Khawaja

Defendant (appellant)

Versatile Holdings Inc.

Defendant (appellant)

Sardar Samiuddin Khan

Defendant (appellant)

Nida Shahid

Defendant (appellant)

Shaid Saleem Khawaja

Defendant (appellant)

Procedural Posture

Collection / Appeal From Summary Judgment

Legal Issues

  1. 1 Whether the corporate appellants ceased to carry on business constituting an event of default under the financing agreements
  2. 2 Whether the motion judge erred in concluding there was a material adverse change in operations
  3. 3 Whether the respondent properly exercised its contractual discretion to demand repayment

Ratio Decidendi

The motion judge correctly found that the corporate appellants ceased to carry on business when they returned restaurant operations to the franchisor, which constituted events of default and authorized the respondent to demand repayment; there was no error in the motion judge’s exercise of discretion including refusal to adjourn, therefore summary judgments were properly granted.

Court Disposition

Appeals dismissed; summary judgments upheld

Orders

  • Appeals dismissed with costs to the respondent fixed in the amount of $17,000.00 payable by the Everest defendants and $16,000.00 payable by the Versatile defendants, both inclusive of disbursements and HST.