Clark v. Werden, 2011 ONCA 619

• Judge: Doherty, Feldman and Epstein, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: March 09, 2011
• Jurisdiction: Ontario
• Citations: 2011 ONCA 619;(2011), 283 O.A.C. 313 (CA)

Clark v. Werden (2011), 283 O.A.C. 313 (CA)

MLB headnote and full text

Temp. Cite: [2011] O.A.C. TBEd. OC.001

Patrick Peter Clark (plaintiff/respondent) v. Leonard James Werden (defendant/appellant)

Patrick Peter Clark (plaintiff/respondent) v. Leonard James Werden and Maximum Swine Marketing Ltd. (defendants/appellants) and John Muller and J & C Muller Farms Inc. (third parties/respondents)

(C51975; 2011 ONCA 619)

Indexed As: Clark v. Werden

Ontario Court of Appeal

Doherty, Feldman and Epstein, JJ.A.

September 30, 2011.

Summary:

Clark was the assignee of a loan agreement between Werden and the third party Muller. Clark sued Werden and his company for the unpaid balance under the loan agreement. Werden counterclaimed.

The Ontario Supreme Court, in a decision reported at [2010] O.T.C. Uned. 1403, allowed the action and dismissed the counterclaim. Werden and his company appealed, arguing that the loan agreement was not enforceable by Clark because of the law against champerty and maintenance.

The Ontario Court of Appeal dismissed the appeal.

Contracts - Topic 6763

Illegal contracts - Agreements contrary to public policy - Champerty and maintenance - What constitutes champerty - Clark was the assignee of a loan agreement between Werden and Muller - Clark sued Werden and his company for the unpaid balance under the loan agreement - Werden argued that the loan agreement was not enforceable by Clark because of the law against champerty and maintenance - Werden argued that Muller would not have pursued him on the debt, and that it was Clark who sought the assignment and the commencement of the lawsuit with no previous interest other than bad feeling toward him - The trial judge allowed the action - She concluded that there had been a valid absolute assignment of a debt in accordance and in compliance with s. 53 of the Conveyancing and Law of Property Act - The Ontario Court of Appeal held that the trial judge made no error in her legal conclusion - The case law was clear that an assignment of a debt was not a champertous transaction and the otherwise applicable criteria of champerty and maintenance did not apply to such an assignment.

Contracts - Topic 6764

Illegal contracts - Agreements contrary to public policy - Champerty and maintenance - What constitutes maintenance - [See Contracts - Topic 6763 ].

Contracts - Topic 6803

Assignment - General - What constitutes an assignment (incl. validity of) - [See Contracts - Topic 6763 ].

Cases Noticed:

McIntyre Estate v. Ontario (Attorney General) (2002), 164 O.A.C. 37; 218 D.L.R.(4th) 193; 61 O.R.(3d) 257 (C.A.), refd to. [para. 9].

Buday et al. v. Locator of Missing Heirs Inc. (1993), 68 O.A.C. 97; 108 D.L.R.(4th) 424; 16 O.R.(3d) 257 (C.A.), refd to. [para. 10].

Frederickson v. Insurance Corp. of British Columbia (1986), 3 B.C.L.R.(2d) 145 (C.A.), affd. [1988] 1 S.C.R. 1089; 86 N.R. 48, refd to. [para. 11].

Plant Software Inc. v. 9123 Investments Ltd. (1999), 6 B.C.T.C. 318; 14 P.P.S.A.C.(2d) 281 (S.C.), refd to. [para. 11].

Fitzroy v. Cave, [1905] 2 K.B. 364 (C.A.), refd to. [para. 12].

NRS Block Bros. Realty Ltd. v. Minerva Technology Inc., [1997] B.C.T.C. Uned. 553; 145 D.L.R.(4th) 448 (S.C.), refd to. [para. 15].

Counsel:

Andrew C. Murray, for the appellant, Leonard James Werden;

J. Douglas Skinner, for the respondent, Patrick Peter Clark.

This appeal was heard on March 9, 2011, before Doherty, Feldman and Epstein, JJ.A., of the Ontario Court of Appeal. Feldman, J.A., delivered the following judgment for the court on September 30, 2011.