



COURT OF APPEAL FOR ONTARIO

CITATION:  Business
    Development Bank of Canada v. Nap Corp., 2013 ONCA 608

DATE: 20131003

DOCKET: C56560

Gillese, Juriansz and Strathy JJ.A.

BETWEEN

Business Development Bank of Canada

Plaintiff (Respondent)

and

Nap Corporation and Arie Tall

Defendants (Appellants)

Adam Jarvis, for the appellants

Rosemary A. Fisher, for the respondent

Heard: September 25, 2013

On appeal from the order of Justice K.A. Carpenter-Gunn of
    the Superior Court of Justice, dated January 2, 2013.

ENDORSEMENT

[1]

The appellants appeal summary judgment in favour of Business Development
    Bank of Canada (BDC) on its loan to NAP, guaranteed by Tall. The loan and
    guarantee are not in dispute. The outstanding balance is $130,091.63.

[2]

The initial hearing of the summary judgment motion, on October 4, 2012,
    was adjourned to permit BCD to obtain evidence from RBC, with whom it had
    entered into a subordination agreement, to show that NAP was in default to RBC,
    thereby triggering default on the BDC loan to NAP.

[3]

The appellants did not consent to RBC disclosing its records.  BDC was
    therefore forced to bring a motion, which was successful, to compel RBC to
    produce the documentation pertaining to its loan to NAP and NAPs default
    thereunder. These documents, including notices and emails confirming NAPs
    default to RBC, were appended to an affidavit of a solicitor in the office of
    counsel for BDC (the impugned affidavit).

[4]

On the continuation of the motion on January 2, 2013, the motion judge
    noted that default was the central issue. She found that the RBC documentation
    confirmed default by the appellant to RBC. There was also evidence from Talls
    cross-examination that appeared to acknowledge this default. She also found
    that Talls affidavit was self-serving and did not establish an issue for
    trial. The appellants had recently cross-examined a representative of RBC, but
    failed to adduce any evidence from that cross-examination on the continuation
    of the summary judgment motion.

[5]

The motion judge therefore found that NAP was in default to RBC and that
    this put NAP in default to BDC. There was no genuine issue for trial and BDC
    was entitled to summary judgment.

[6]

These conclusions were fully warranted on the record before the motion
    judge.

[7]

We reject the appellants submission that they did not have notice of
    the case they were required to meet on January 2, 2013, and that, having
    dismissed their motions to stay the summary judgment motion and to strike the
    impugned  affidavit, the motion judge should have granted an adjournment to
    permit them to file additional materials.

[8]

The issue of whether NAP was in default to RBC was the very reason for
    the adjournment on October 4, 2012, and the reason for BDCs motion for the
    production of the RBC records. The information necessary to respond to this
    issue was entirely within the control of the appellants. They were required to
    put their best foot forward, not litigate step-by-step.

[9]

The motion judge was entitled to discount their evidence as self-serving
    and to draw an adverse inference from their failure to adduce available
    evidence from the cross-examination of RBC. The appellants failed to refute BDCs
    evidence that there was no genuine issue for trial.

[10]

The
    motion judge was also entitled to receive the impugned affidavit.  The impugned
    affidavit attached the business records obtained from RBC, which spoke for
    themselves and appeared uncontroversial. It was open to the appellants to
    cross-examine the affiant, to file their own affidavit evidence or to file any
    relevant evidence they had obtained on cross-examination of RBC.

[11]

We
    also find that the motion judge made no error in dismissing the appellants
    cross-motion to stay the summary judgment motion. That cross-motion was filed
    after the initial hearing on October 4, 2012, and before the continued hearing
    on January 2, 2013. As this court noted in
Combined Air Mechanical Services
    Inc. v. Flesch
, 2011 ONCA 764, at para. 58, it may be appropriate for a
    responding party to move to stay a premature summary judgment motion to ensure
    that an appropriate evidentiary record is available after discovery. In this
    case, however, the appellants had filed evidence in response to the summary
    judgment motion and were prepared to contest it on the merits at the first
    hearing. The motion judge found that the appellants were aware of the case they
    were required to meet before the continued hearing. At the continued hearing, they
    chose not to file further evidence and the motion judge made no error in the
    exercise of her discretion in refusing a stay.

[12]

For
    these reasons, the appeal is dismissed, with costs in the agreed amount of
    $15,044.28, all inclusive.

E.E.
    Gillese J.A.

"R.G. Juriansz
    J.A."

"G.R. Strathy
    J.A."


