Moffatt v. The Merchants' Bank of Canada

Moffatt v. The Merchants' Bank of Canada

Majority: The appellant, an experienced businessman, signed the bond and agreement and is bound by their plain tenor; the bank made no representations to him and acted in good faith on the instruments, therefore he is liable under the documents as executed for the amount secured ($10,000 plus interest and costs).

Citation
(1885) 11 SCR 46
Parties
Appellant/defendant: George Moffatt; Respondent/plaintiff: The Merchants' Bank of Canada
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
12 January 1885
Procedural Posture
Collection (contract) Appeal / Appeal to the Supreme Court of Canada From the Chancery Division of the High Court of Justice for Ontario
Outcome
Appeal dismissed; judgment of the court below affirmed.
Legal Topics
Suretyship, Mortgage, Continuing Security, Estoppel, Misrepresentation, Construction of Deeds, Accounting
Source Language
English
Contract Banking Equity Property Suretyship Mortgage Continuing Security Estoppel +3 more

Case Brief

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Parties

George Moffatt

Appellant/defendant

The Merchants' Bank of Canada

Respondent/plaintiff

Procedural Posture

Collection (contract) Appeal / Appeal to the Supreme Court of Canada From the Chancery Division of the High Court of Justice for Ontario

Legal Issues

  1. 1 Whether appellant was bound by bond and agreement he signed despite alleged representations by a co-obligor
  2. 2 Whether the bond and accompanying agreement were limited to the then existing indebtedness represented by commercial paper or extended to future advances and general deficiencies
  3. 3 Whether the bank could recover losses attributable to subsequent advances (including accommodation paper) under the guaranty

Ratio Decidendi

Majority: The appellant, an experienced businessman, signed the bond and agreement and is bound by their plain tenor; the bank made no representations to him and acted in good faith on the instruments, therefore he is liable under the documents as executed for the amount secured ($10,000 plus interest and costs).

Court Disposition

Appeal dismissed; judgment of the court below affirmed.

Orders

  • Judgment for respondents for $10,000 with interest from commencement of action and costs awarded to respondents
  • Appeal to the Supreme Court of Canada dismissed with costs