Toronto-Dominion Bank v. Home & Us Corporation

Toronto-Dominion Bank v. Home & Us Corporation

The Court held the motion judge correctly found no genuine issue for trial: the appellants had acknowledged a prior valid demand (May 21, 2021) so the bank's demand was effective, and the CEBA agreement's administration provisions, cross-default clause and covenant to carry on business were breached when business activities ceased, permitting enforcement; summary judgment was therefore appropriate.

Citation
2023 ONCA 145
Parties
Plaintiff (respondent): The Toronto-Dominion Bank; Defendant (appellant): Home & Us Corporation; Defendant (appellant): Asma Parveen
Court
Court of Appeal for Ontario
Jurisdiction
Canada
Judgment Date
3 March 2023
Procedural Posture
Collection / Appeal From Superior Court — Motion for Summary Judgment
Outcome
Appeal dismissed
Legal Topics
Summary Judgment, Personal Guarantee, CEBA Loan, Demand for Payment, Cross Default Clause, Corporate Officer Liability, Contractual Covenant to Carry on Business
Source Language
English
Civil Banking Commercial Law Contract Debt Collection Summary Judgment Personal Guarantee CEBA Loan +4 more

Case Brief

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Parties

The Toronto-Dominion Bank

Plaintiff (respondent)

Home & Us Corporation

Defendant (appellant)

Asma Parveen

Defendant (appellant)

Procedural Posture

Collection / Appeal From Superior Court — Motion for Summary Judgment

Legal Issues

  1. 1 Whether the bank's demand for payment was valid despite alleged lack of notice to the director
  2. 2 Whether the CEBA term loan could be accelerated or demanded prior to maturity given its terms and source of funds
  3. 3 Whether cessation of business violated the covenant to carry on business and triggered default under the CEBA cross-default clause

Ratio Decidendi

The Court held the motion judge correctly found no genuine issue for trial: the appellants had acknowledged a prior valid demand (May 21, 2021) so the bank's demand was effective, and the CEBA agreement's administration provisions, cross-default clause and covenant to carry on business were breached when business activities ceased, permitting enforcement; summary judgment was therefore appropriate.

Court Disposition

Appeal dismissed

Orders

  • Appeal dismissed
  • Costs awarded to the respondent in the amount of $8,000 inclusive of disbursements and HST