Edmonton Savings & Credit Union Ltd. v. Grandin Park Barbershop & Beauty Parlor Ltd., Zottl and Chartrand, (1985) 62 A.R. 20 (QBM)

• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: May 16, 1985
• Citations: (1985), 62 A.R. 20 (QBM)

Edmonton Savings v. Grandin Park (1985), 62 A.R. 20 (QBM)

MLB headnote and full text

Edmonton Savings and Credit Union Ltd. v. Grandin Park Barbershop & Beauty Parlor Ltd., Zottl and Chartrand

(8303 27040)

Indexed As: Edmonton Savings & Credit Union Ltd. v. Grandin Park Barbershop & Beauty Parlor Ltd., Zottl and Chartrand

Alberta Court of Queen's Bench

Judicial District of Edmonton

Funduk, Master in Chambers

May 16, 1985.

Summary:

After default on a mortgage, the mortgagee commenced an action on both the mortgage and the guarantee. The mortgagor was noted in default; the guarantors delivered a statement of defence. The mortgaged land was sold, leaving the mortgagee with a deficiency claim. The mortgagee applied for summary judgment for the amount of the deficiency.

A Master of the Alberta Court of Queen's Bench granted summary judgment against the mortgagor and the guarantors for the amount of the deficiency.

Courts - Topic 2121

Jurisdiction - Trial jurisdiction - Failure to plead relief sought - A Master of the Alberta Court of Queen's Bench stated that a trial court's jurisdiction to award judgment was restricted to the relief sought on the issues placed before it by the pleadings - See paragraphs 37 to 38.

Guarantee and Indemnity - Topic 9

General - Guarantor and debtor distinguished - A Master of the Alberta Court of Queen's Bench stated that it was impossible in law for a person to be both the debtor and the guarantor - See paragraph 18.

Guarantee and Indemnity - Topic 144

The contract - Consideration - What constitutes - A Master of the Alberta Court of Queen's Bench held that a guarantee that was given in consideration of the creditor giving a loan to the debtor was given for sufficient consideration - See paragraph 34.

Guarantee and Indemnity - Topic 225

The contract - Interpretation - Performance covenant v. covenant to pay collateral sum - A Master of the Alberta Court of Queen's Bench examined whether a guarantor's covenant was a performance covenant or a covenant to pay a collateral sum - The Master distinguished between the two with respect to the necessity for demand, notice and when the guarantor's liability arose - See paragraphs 64 to 102.

Guarantee and Indemnity - Topic 1053

Liability of surety to creditor - Action against surety - Notice of debtor's default - Whether required - A Master of the Alberta Court of Queen's Bench held that where the guarantor covenanted to pay a collateral sum, without more, the guarantor was not entitled to notice of the debtor's default unless he contracted for it - See paragraph 180.

Guarantee and Indemnity - Topic 1057

Liability of surety to creditor - Action against surety - Demand - Whether required - A Master of the Alberta Court of Queen's Bench held that where the guarantor covenanted to pay a collateral sum, without more, the guarantor was not entitled to a demand unless he contracted for it - See paragraph 180.

Guarantee and Indemnity - Topic 1057

Liability of surety to creditor - Action against surety - Demand - Whether required -A Master of the Alberta Court of Queen's Bench discussed whether a demand on a guarantor was a condition precedent to the commencement of an action or an essential ingredient of the cause of action - See paragraphs 62 to 104.

Guarantee and Indemnity - Topic 1059

Liability of surety to creditor - Action against surety - Time for - A Master of the Alberta Court of Queen's Bench stated that where a guarantor was liable under a performance covenant liability arose the moment the debtor defaulted - The Master stated that the guarantor was liable at that time unless clear language shifted the cause of action to a later time, such as when a demand was made on the guarantor - See paragraph 181.

Guarantee and Indemnity - Topic 9266

Practice - Pleadings - Demand - Necessity of pleading - A Master of the Alberta Court of Queen's Bench stated that where a demand was a condition precedent to the commencement of an action against a guarantor, as opposed to an essential ingredient of the cause of action, it was implied in the statement of claim that such condition precedent was met; that pursuant to rule 108 the demand did not have to be pleaded -See paragraphs 63, 154.

Practice - Topic 1617

Pleadings - The defence - Issues to be raised must be pleaded - A creditor applied for summary judgment against two guarantors - At trial, the guarantors submitted that since no demand was made, they were not liable - That defence was not pleaded, nor was an amendment to the statement of defence sought, even though the guarantors had one year to do so - A Master of the Alberta Court of Queen's Bench held that the non-pleaded issue could not now be raised, because the court's jurisdiction to award judgment was restricted to the relief sought on the issues pleaded - See paragraphs 37 to 63.

Cases Noticed:

Canada Permanent Mortgage Corporation v. Halet Enterprises, 48 B.C.L.R. 207 (S.C.), refd to. [para. 19].

Signature Finance v. Golden Key Rental (1982), 38 A.R. 495 (Q.B.), refd to. [para. 19].

Brown Bros. Motor Lease Canada v. Ganapathi, 139 D.L.R.(3d) 227 (B.C.S.C.), refd to. [para. 19].

Heald v. O'Connor, [1971] 1 W.L.R. 497 (Q.B.), refd to. [para. 19].

Credit Foncier Franco Canadien v. 253171 Alberta (1985), 57 A.R. 241; 33 Alta. L.R.(2d) 276 (Q.B.), refd to. [para. 21].

National Bank of Canada v. Rosario (1985), 60 A.R. 8, refd to. [para. 32].

Bank of Montreal v. Danial (1983), 46 A.R. 64 (Q.B.), refd to. [para. 34].

Creditel of Canada v. Terrace Corporation (Edmonton) (1984), 50 A.R. 311 (C.A.), appld. [para. 37].

Pyramid Construction (Calgary) v. Feil (1957), 22 W.W.R.(N.S.) 497 (Alta. S.C.), refd to. [para. 41].

Canadian Plasmapheresis Centres Ltd. v. Canadian Broadcasting Corporation, 8 O.R.(2d) 55 (H.C.), refd to. [para. 42].

Johns-Manville Canada v. John Carlo Ltd. (1981), 29 O.R.(2d) 592 (H.C.), affd. 32 O.R.(2d) 697 (C.A.), refd to. [para. 45].

Canada Permanent Trust Company v. King Art Developments Ltd. et al. (1984), 52 A.R. 139 (C.A.), refd to. [para. 48].

Canada Permanent Trust Company v. King Art Developments Ltd. et al. (1984), 54 A.R. 172; 32 Alta. L.R.(2d) 1 (C.A.), refd to. [para. 65].

Moschi v. Lep Air Services, [1973] A.C. 344 (H.L.), refd to. [para. 67].

Federal Business Development Bank v. Mid-Can Dental Supply Co., [1984] 1 W.W.R. 464; 29 Sask.R. 81 (Sask. C.A.), refd to. [para. 77].

Continental Insurance Company v. Law Society of Alberta (1985), 56 A.R. 98; 34 Alta. L.R.(2d) 214 (C.A.), refd to. [para. 89].

Sentinel-Review Co. Ltd. v. Robinson et al., [1928] S.C.R. 258; [1928] 3 D.L.R. 97, refd to. [para. 90].

Meridian Developments v. Nu-West Group (1984), 52 A.R. 248 (C.A.), refd to. [para. 91].

Deloitte Haskins and Sells v. Canadian Imperial Bank of Commerce, [1982] 3 W.W.R. 60 (Man. C.A.), refd to. [para. 92].

Browns Estate, Re, [1893] 2 Ch. 300, refd to. [para. 105].

Royal Bank of Canada v. Dwigans, [1933] 1 W.W.R. 672 (Alta. C.A.), refd to. [para. 111].

Royal Trust Corporation of Canada v. Reid (1984), 47 Nfld. & P.E.I.R. 199; 139 A.P.R. 199 (P.E.I.S.C.), refd to. [para. 113].

Parr's Banking Company v. Yates, [1898] 2 Q.B. 460 (C.A.), refd to. [para. 117].

Rural Municipality of Wellington v. Dale, [1923] 1 W.W.R. 97 (Sask. C.A.), refd to. [para. 124].

Bradford Old Bank v. Sutcliffe, [1918] 2 K.B. 833 (C.A.), refd to. [para. 128].

Esso Petroleum Co. v. Alstonbridge Properties, [1975] 1 W.L.R. 1474 (Ch. D.), refd to. [para. 138].

Royal Bank of Canada v. Oram, [1978] 1 W.W.R. 564 (B.C.S.C.), refd to. [para. 142].

Canadian Petrofina v. Motormart, 7 D.L.R.(3d) 330 (P.E.I.C.A.), refd to. [para. 148].

Bank of Montreal v. MacGregor, 21 B.C.L.R. 83 (S.C.), refd to. [para. 155].

Georgeson v. Dominion Bank, [1924] 2 W.W.R. 931 (Alta. C.A.), refd to. [para. 178].

Schug v. Odegaard (1984), 55 A.R. 321; 32 Alta. L.R.(2d) 355 (Q.B.), refd to. [para. 190].

Counsel:

N.R. St. Arnaud, for the plaintiff;

G. DiPinto, for Fred Zottl and Marcel Chartrand.

This application was heard before Funduk, Master in Chambers, of the Alberta Court of Queen's Bench, Judicial District of Edmonton, who delivered the following judgment on May 16, 1985: