O'Hanlon Paving Ltd. v. Serengetti Developments Ltd. et al., (2013) 567 A.R. 140 (QB)

• Judge: Wakeling, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: July 16, 2013
• Citations: (2013), 567 A.R. 140 (QB);2013 ABQB 428

O'Hanlon Paving Ltd. v. Serengetti Dev. Ltd. (2013), 567 A.R. 140 (QB)

MLB headnote and full text

Temp. Cite: [2013] A.R. TBEd. AU.020

O'Hanlon Paving Ltd. (plaintiff) v. Serengetti Developments Ltd., Gocan Corp. and U Construction Ltd. (defendants)

(1103 19995)

Waiward Construction Management Inc. (plaintiff) v. Serengetti Developments Ltd., Gocan Corp. and U Construction Ltd. (defendants)

(1103 19997; 2013 ABQB 428)

Indexed As: O'Hanlon Paving Ltd. v. Serengetti Developments Ltd. et al.

Alberta Court of Queen's Bench

Judicial District of Edmonton

Wakeling, J.

July 29, 2013.

Summary:

The plaintiffs, in separate actions, sought summary judgment against the defendants to enforce written promises to pay certain sums of money to them upon demand. The defendants argued that they provided the promises subject to the plaintiffs not demanding payment until recourse against a fund held by the City of Edmonton had first been exhausted. The issues were: (1) whether the written instruments constituted promissory notes under s. 176(1) of the Bills of Exchange Act; (2) if so, whether the plaintiffs could commence actions to enforce the demand promissory notes without first having made a demand for payment; (3) whether there existed collateral agreements precluding the plaintiffs from demanding payment when they did; (4) if not, whether the defendants failed to discharge their obligations; and (5) the rate of interest to which the plaintiffs were entitled.

The Alberta Court of Queen's Bench held that the written instruments were enforceable promissory notes under the Act. The plaintiffs were entitled to commence actions to enforce the promissory notes without first making demands for payment. The plaintiffs were entitled to summary judgments for the full amounts claimed, as the defendants had no defence to the claims. The plaintiffs were entitled to interest under the federal Interest Act, rather than the provincial Judgment Interest Act, from the date their actions were commenced (December 21, 2011) to the date of judgment.

Interest - Topic 5306

Interest as damages (prejudgment interest) - Interest on payment of money or debt withheld - Amount due under negotiable instrument - [See Negotiable Instruments - Topic 6001 ].

Negotiable Instruments - Topic 6001

Promissory notes - General principles and definitions - Promissory note defined - The plaintiffs, in separate actions, sought summary judgment against the defendants to enforce written promises to pay certain sums of money to them upon demand - The defendants argued that they provided the promises subject to the plaintiffs not demanding payment until recourse against a fund held by the City of Edmonton had first been exhausted - The issues were: (1) whether the written instruments constituted promissory notes under s. 176(1) of the Bills of Exchange Act; (2) if so, whether the plaintiffs could commence actions to enforce the demand promissory notes without first having made a demand for payment; (3) whether there existed collateral agreements precluding the plaintiffs from demanding payment when they did; (4) if not, whether the defendants failed to discharge their obligations; and (5) the rate of interest to which the plaintiffs were entitled - The Alberta Court of Queen's Bench held that the written instruments, which contained unconditional promises to pay the plaintiffs a specified sum on demand, were enforceable promissory notes under the Act - The plaintiffs were entitled to commence actions to enforce the promissory notes without first making demands for payment - There was no evidence of collateral agreements restricting the right to seek payment - The plaintiffs were entitled to summary judgments for the full amounts claimed, as the defendants had no defence to the claims - The plaintiffs were entitled to interest under the federal Interest Act, rather than the provincial Judgment Interest Act, from the date their actions were commenced (December 21, 2011) to the date of judgment - See paragraphs 33 to 70.

Negotiable Instruments - Topic 6301

Promissory notes - Interest - General - [See Negotiable Instruments - Topic 6001 ].

Negotiable Instruments - Topic 8307

Promissory notes - Payment - Requirement of demand for payment - Demand note - [See Negotiable Instruments - Topic 6001 ].

Practice - Topic 5701

Judgments and orders - Summary judgments - General - The Alberta Court of Queen's Bench summarized the historical development and current state of the law in Alberta respecting summary judgments - See paragraphs 33 to 43.

Cases Noticed:

Beier et al. v. Proper Cat Construction Ltd. et al. (2013), 564 A.R. 357; 2013 ABQB 351, refd to. [para. 33].

Lameman et al. v. Canada (Attorney General) et al., [2008] 1 S.C.R. 372; 372 N.R. 239; 429 A.R. 26; 421 W.A.C. 26, refd to. [para. 34].

Lloyd v. Lawrence (1973), 472 F.2d 313 (5th Cir.), refd to. [para. 36].

Dushenski et al. v. Lymer et al. (2010), 500 A.R. 48 (Q.B.), refd to. [para. 37].

HSBC Bank Canada v. Vallet et al. (2009), 483 A.R. 240 (Q.B.), refd to. [para. 37].

State Bank of Butler v. Benzanson (1914), 16 D.L.R. 848 (Alta. S.C.), refd to. [para. 37].

Bank of Montreal v. Mangold et al. (1988), 86 A.R. 215 (Q.B. Master), refd to. [para. 37].

Stolberg Mill Construction Ltd. v. Selkirk Spruce Mills Ltd. (1957), 22 W.W.R.(N.S.) 605 (B.C.S.C.), refd to. [para. 37].

Butkovsky v. Jalbuena (1982), 132 D.L.R.(3d) 177 (B.C. Co. Ct.), refd to. [para. 37].

Heaman v. Schnurr, [2011] O.T.C. Uned. 2661; 2011 ONSC 2661, refd to. [para. 37].

Quick Credit v. 1575463 Ontario Inc. et al., [2010] O.T.C. Uned. 7227; 2010 ONSC 7227, refd to. [para. 37].

Fierro v. Sinclair, [2012] N.S.R.(2d) Uned. 311; 2012 NSSC 429, refd to. [para. 37].

Field & Platt Ltd. v. Najjar, [1969] 1 W.L.R. 357 (C.A.), refd to. [para. 37].

Griffon LLC v. 11 East 36th LLC (2011), 934 N.Y.S.2d 472 (App. Div.), refd to. [para. 37].

Federal Deposit Insurance Corp. v. Willis (1980), 497 F. Supp. 272 (S. Dist. Ga.), refd to. [para. 37].

Nonneman v. Murphy, 2012 Bankr. Lexis 4264 (E. Dist. Ky. Bktcy. Ct.), refd to. [para. 37].

Wells Fargo Bank, NA v. Ortega, 2012 WL 3570734 (10th Cir.), refd to. [para. 37].

Guarantee Co. of North America v. Gordon Capital Corp., [1999] 3 S.C.R. 423; 247 N.R. 97; 126 O.A.C. 1, refd to. [para. 40].

Another Look Ventures Inc. et al. v. 642157 Alberta Ltd., [2012] A.R. Uned. 300; 2012 ABCA 253, refd to. [para. 40].

Enokhok Development Corp. et al. v. Alberta (Treasury Branches) et al., [2011] A.R. Uned. 545; 68 Alta. L.R.(5th) 126 (C.A.), refd to. [para. 40].

Prefontaine v. Veale et al. (2003), 339 A.R. 340; 312 W.A.C. 340 (C.A.), refd to. [para. 40].

Beaver Hills Holdings Ltd. et al. v. Greenstreet Development Corp. et al., [2012] A.R. Uned. 610; 2012 ABQB 525, refd to. [para. 42].

Espey v. Chapters Inc. (1998), 225 A.R. 68 (Q.B.), refd to. [para. 42].

Shell Canada Products Ltd. v. Whissel Construction (Fort McMurray) Ltd., [1993] A.J. No. 1289 (Q.B. Master), refd to. [para. 42].

Handleman et al. v. G & G Group Ltd. et al., [2006] O.T.C. Uned. D63; 2006 CarswellOnt 8245 (Sup. Ct.), refd to. [para. 42].

Poliquin v. Devon Canada Corp. (2009), 454 A.R. 61; 455 W.A.C. 61 (C.A.), refd to. [para. 43].

Engel v. Aetna Life Insurance Co. (1943), 139 F.2d 469 (2nd Cir.), refd to. [para. 43].

Glesby v. Mitchell, [1932] S.C.R. 260, refd to. [para. 44].

Riley v. Murray, [1923] 3 D.L.R. 923 (Alta. C.A.), refd to. [para. 44].

Peden v. Gear (1921), 64 D.L.R. 439 (Ont. S.C.), refd to. [para. 44].

Range v. Belvedere Finance Corp., [1969] S.C.R. 492, refd to. [para. 47].

Resort Funding LLC v. Fairmont Resort Properties Ltd. et al. (2009), 464 A.R. 53; 467 W.A.C. 53; 2009 ABCA 337, refd to. [para. 47].

Bank of Montreal v. Abrahams et al. (2003), 179 O.A.C. 36; 68 O.R.(3d) 34 (C.A.), refd to. [para. 49].

Francis v. Bruce (1890), 44 Ch. D. 627, refd to. [para. 50].

Maltby v. Murrells (1860), 157 E.R. 1405, refd to. [para. 50, footnote 12].

Beaver Lumber Co. v. Hopfauf, [1932] 1 W.W.R. 357 (Sask. C.A.), refd to. [para. 50, footnote 12].

Glasscock v. Balls (1889), 24 Q.B.D. 13 (C.A.), refd to. [para. 50, footnote 12].

Royal Bank of Canada v. Dwigans, [1933] 3 D.L.R. 178 (Alta. C.A.), refd to. [para. 50].

Canada Trustco Mortgage Co. v. 112293 Holdings Ltd., M.D. Sears Holdings Ltd. and Sears (1984), 72 A.R. 357 (C.A.), refd to. [para. 50].

Liska v. Bank of British Columbia, [1981] 4 W.W.R. 223; 27 A.R. 614 (Q.B.), refd to. [para. 50].

Hayden-Clinton National Bank v. Dixon (1916), 9 W.W.R. 1269 (Alta. C.A.), refd to. [para. 52].

Union Bank v. MacCullough (1912), 7 D.L.R. 694 (Alta. S.C.), refd to. [para. 52].

Schonemier v. King (1930), 50 B.C.R. 174 (C.A.), refd to. [para. 52].

Anderson v. Hiested (1916), 10 W.W.R. 636 (Sask. S.C.), refd to. [para. 52].

Canadian Bank of Commerce v. Bellamy (1915), 25 D.L.R. 133 (Sask. S.C.), refd to. [para. 52].

Robertson v. North Western Register Co. (1910), 19 Man.R. 402 (C.A.), refd to. [para. 52].

Freeman v. Canadian Guardian Life Insurance Co. (1908), 17 O.L.R. 296 (H.C.), refd to. [para. 52].

Sparks v. Conmee (1919), 45 O.L.R. 200 (H.C.), refd to. [para. 52].

Merchants' Bank of Canada v. Henderson (1897), 28 O.R. 360 (H.C.), refd to. [para. 52].

Sinclair v. Deacon (1909), 7 E.L.R. 222 (P.E.I.S.C.), refd to. [para. 52].

Toronto-Dominion Bank v. Mr. Klean Enterprises Ltd. and Shinkaruk, [1987] 4 W.W.R. 461; 55 Sask.R. 93 (C.A.), refd to. [para. 59, footnote 15].

Royal Bank of Canada v. Estabrooks Pontiac Buick Ltd. (1985), 60 N.B.R.(2d) 160; 157 A.P.R. 160; 17 D.L.R.(4th) 75 (C.A.), refd to. [para. 59, footnote 15].

Pizzey Estate v. Crestwood Lake Ltd. et al. (2004), 181 O.A.C. 383; 236 D.L.R.(4th) 177 (C.A.), refd to. [para. 59, footnote 15].

Canadian Western Bank et al. v. Alberta, [2007] 2 S.C.R. 3; 362 N.R. 111; 409 A.R. 207; 402 W.A.C. 207, refd to. [para. 66].

Law Society of British Columbia v. Mangat, [2001] 3 S.C.R. 113; 276 N.R. 339; 157 B.C.A.C. 161; 256 W.A.C. 161, refd to. [para. 66].

Multiple Access Ltd. v. McCutcheon et al., [1982] 2 S.C.R. 161; 44 N.R. 181, refd to. [para. 66].

Statutes Noticed:

Bills of Exchange Act, R.S.C. 1985, c. B-4, sect. 22(1)(a), sect. 133, sect. 176(1), sect. 179(1), sect. 183(3), sect. 185(a), sect. 186(1) [para. 15].

Rules of Court (Alta.), rule 7.3 [para. 14].

Authors and Works Noticed:

Bauman, John A., The Evolution of the Summary Judgment Procedure: An Essay Commemorating the Centennial Anniversary of Keating's Act (1956), 31 Ind. L.J. 329, p. 350 [para. 36].

Byles, Bills of Exchange and Cheques (27th Ed. 2002), pp. 360, 361 [para. 54].

Clark, Charles E., and Samenow, Charles U., The Summary Judgment (1929), 38 Yale L.J. 423, generally [para. 34, footnote 11].

Crawford, Bradley, The Law of Banking and Payment in Canada (2012 Looseleaf Update, Release 6), c. 35 [para. 45].

Guest, Anthony Gordon, Chalmers and Guest on Bills of Exchange, Cheques and Promissory Notes (16th Ed. 2005), p. 688 [para. 54].

Hogg, Peter W., Constitutional Law of Canada (5th Ed.) (2007 Looseleaf Supp.) (2012 Update, Release 1), vol. 1, p. 16-7 [para. 67].

Lederman, William Ralph, Continuing Canadian Constitutional Dilemmas (1982), p. 255 [para. 66].

Odgers, Blake W., High Court Pleading and Practice (23rd Ed. 1991), p. 108 [para. 35].

Counsel:

A.D. (Tom) Schmit (Chomicki Baril Mah LLP), for the plaintiffs;

James Culkin, for the defendants.

These applications were heard on July 16, 2013, before Wakeling, J., of the Alberta Court of Queen's Bench, Judicial District of Edmonton, who delivered the following judgment on July 29, 2013.