Background
Between August 2018 and July 2019, Beechhill Capital Corp. lent $1 million to P2P Green Power Energy Solutions Inc., 2521059 Ontario Inc. and John Carroll under three promissory notes. Repayment was due by August 31, 2020, and the notes were secured by shares owned by the appellants in a company in which the respondents had an interest. On April 1, 2021, the amounts owed under those notes and additional advances were consolidated into one promissory note for more than $1.3 million. That note was also secured by shares, and payment was due by March 31, 2023.
The parties asserted several claims arising from their business dealings. Beechhill sought payment under the consolidated note, while the appellants advanced claims including oppression. Beechhill moved for summary judgment on the note. The motion judge granted the motion and ordered the appellants to pay the amount due. The appellants appealed, arguing that there were triable issues and that the motion judge had failed to make necessary factual findings, particularly concerning inducement.
The appeal was heard on October 29, 2026. After hearing submissions from the appellants, the Court of Appeal dismissed the appeal with reasons to follow. Its subsequent reasons were delivered by a panel of Roberts, Favreau and Copeland JJ.A. J. Paul R. Cassan and Brittany Hollingsworth acted for the appellants, and Catherine Patterson acted for the respondents.
The Court’s Holding
The Court dismissed the appeal. It characterized the appellants’ submissions as an attempt to re-argue the summary judgment motion. The Court stated that its role was not to decide the issues afresh; the appellants had to identify an error in the motion judge’s reasons, and they had failed to do so.
The Court found that the motion judge had carefully reviewed the evidence and addressed each issue. On inducement, she noted that Beechhill had advanced the loans before the alleged misrepresentations about the value of the securing shares were made, meaning there was no inducement. On the consolidated note, the Court agreed that the limitation period had not lapsed: time began to run from the date payment was due under that note. It also agreed that forbearance on enforcing the three earlier notes constituted consideration for the consolidated note.
The Court further upheld the grant of partial summary judgment. The motion judge had specifically considered whether the note claim could be separated from the remaining litigation and found that its factual and legal circumstances were extricable from the issues in the other claims. The Court saw no error in that conclusion. It also noted that equitable set-off had not been pleaded and, even if it had been, would not have been available in the circumstances. The appellants remained free to pursue their oppression claim and other claims against the respondents. The Court awarded the respondents costs of $10,000, all inclusive, as agreed by the parties.
Key Takeaways
- An appellant challenging summary judgment must identify an error in the motion judge’s reasons rather than merely re-argue the motion.
- The alleged share-value misrepresentations could not establish inducement because the loans were advanced before those representations were made.
- The limitation period ran from the due date under the consolidated note, and forbearance on the earlier notes supplied consideration for the consolidation.
- Partial summary judgment was appropriate because the note claim was extricable from the remaining claims; the oppression and other claims may still proceed.
Why It Matters
The decision illustrates the Court of Appeal’s insistence on an identified error when reviewing a summary judgment, while addressing the particular defences raised rather than announcing a universal rule about promissory-note litigation. It also confirms that resolving a separable debt claim by partial summary judgment need not dispose of related oppression or other claims.
The equitable set-off discussion is expressly tied to the appellants’ failure to plead it and the circumstances of this case. The disposition was the dismissal of the appeal and an agreed all-inclusive costs award of $10,000 to the respondents.