Bradley Leonard - v. -, 2013 SKPC 169

IN THE PROVINCIAL COURT OF SASKATCHEWAN CIVIL DIVISION Date: October 8, 2013 Citation: 2013 SKPC 169 File: File 78/13 Location: Regina, Saskatchewan _____________________________________________________________________________ Between: Bradley Leonard - and - Mallory Bezan Bradley Leonard For the Plaintiff Mallory Bezan For the Defendant _____________________________________________________________________________ JUDGMENT P.

DEMONG, J _____________________________________________________________________________ INTRODUCTION [ 1 ] The plaintiff brings this action for breach of contract against the defendant to recover charges, cash advances, interest, and penalties he says were incurred by her when she used an additional credit card that he had acquired for her use while they were dating.

The defendant defends this action and says that: 1. There is no written contract between the plaintiff and the defendant and therefore no binding agreement between the parties; 2. In any event she paid off all charges that were incurred by her, and if money remains owing it is in relation to the plaintiff’s use ofthe card or use of the card for the mutual benefit of both parties; 3.

If there is a binding contract between the parties, then the plaintiff’s failure to provide her with timely details of the indebtedness onthe card precluded her from taking active steps to validate her share of the charges on the card and further precluded her from takingimmediate steps to address the interest charges accumulating on the card. Therefore the defendant should only have to pay the principalamount of the charges made and not the accrued interest. EVIDENCE AND ANALYSIS 1.

Is there a binding agreement between the parties and what are its essential terms? [2] The plaintiff and defendant started dating in 2008 and in early 2009 the defendant moved into the plaintiff’s home on a farm wherehe worked with his father, about ten minutes away from Regina. [3] The defendant had been planning a trip to London, England but she was concerned that in the event of a financial emergency shewould not have access to sufficient credit as she owned only a pre-paid credit card.

For reasons not made entirely clear at trial she had notbeen able to obtain a credit card allowing her to charge items on credit and then pay it off as the primary obligee. [4] The plaintiff however had no such problem. Because of his love and affection for the defendant and the comfort and solace that hewould derive in knowing that she would have ready financial resources at hand, he applied for and received what is known in the creditindustry as an “Additional Card”.

In fact he received two cards. [5] The plaintiff’s Credit Card Agreement with CIBC (Exhibit P1) made it explicitly clear that he was the primary holder of these cards,and exclusively responsible for any debt that may arise through the use of either of the cards. Because there were two cards he couldauthorize a person to use the additional card, subject of course to the obligation mentioned above. [6] The plaintiff authorized the defendant to use his additional card and gave her the credit card ending in card number 7457.

In sodoing they each agreed that if and when the defendant used the card she would be directly responsible to the plaintiff to ensure that allcharges made, cash advanced, and penalties and interest accruing, would be paid off. [7] Because the plaintiff was the primary holder of the card, the card invoices would be sent to him and he would, from time to timeadvise the defendant of the balance owing and the minimum payment due.

She would pay down the card from time to time either at therequest of the plaintiff or when she felt she needed to make an additional payment. [8] With this understanding in mind the defendant took her trip and began to use the card, and continued to use the card (with theplaintiff’s acquiescence) until well after the plaintiff and defendant finally broke up near the end of April 2010. [9] At trial each of the parties acknowledged that what I have described above was the essence of their understanding ... clear on theessential terms, but a little fuzzy on the reporting requirements.

Over time the parties conducted themselves in accordance with the termsof that agreement. [10] I am satisfied that the parties entered into a binding oral agreement in accordance with the essential terms set out above. [11] Contrary to the defendant’s first defence to this action, agreements such as this do not, in law, need to be in writing to be binding onthe parties. They are enforceable according to their terms and once the terms of an oral contract such as this are ascertained they aretreated as possessing the same certainty as those of a written contract [See generally: Lindsey v.

Heron & Co. (1921), (ON CA), 50 O.L.R. 1 (C.A.)]. 2. Did the defendant pay off all of the charges on the credit card that were incurred by her? Did the plaintiff ever use the cardfor his own purposes? Did the plaintiff derive any financial benefit through the use of the card? [12] The defendant began to use the card extensively and not simply when emergent financial situations arose.

[ 13 ] The card was first used on or about February of 2009 and up until the end of July 2009, it was used a further 119 times ... sometimes as often as four or five times per day. [ 14 ] By the end of April 2010, it had been used another 115 times, and then only 18 more times until October 17, 2010 which is the last time it was used. There were 252 charges on the card over a time span of approximately 20 months. [ 15 ] I have referred to July of 2009 and April 2010 because those dates are significant. The defendant and the plaintiff ceased to cohabit by early summer of 2009 but continued to date thereafter.

The parties gave conflicting evidence on when these events occurred and where there was disagreement on these issues, I prefer the evidence of the defendant. Her evidence on these points were consistent and she provided specific examples to buttress her position. [ 16 ] The plaintiff’s evidence was equivocal and uncertain. On occasion he had to concede the correctness of the defendant’s assertions. A prime example of this was the plaintiff’s assertion when giving his evidence in-chief that they had last dated in July of 2009.

On cross- examination he eventually conceded that he had been dating the defendant as late as December of 2009. [ 17 ] At trial I ordered each party to provide a list of those charges to the card that were incurred exclusively by the defendant, exclusively by the plaintiff, or jointly incurred for their mutual benefit. [ 18 ] The plaintiff was adamant that he charged nothing at all on the card as it was in the exclusive possession of the defendant and further because he simply had no reason to use it as he had his own card.

He provided specific examples of situations where it would have been impossible for him to have charged items because they were incurred out of province and he had taken no vacations at those times. [ 19 ] The defendant acknowledged a significant number of charges that she made herself, but identified a greater number of charges that she felt were incurred by the plaintiff. To be fair to her, she qualified this by suggesting that because of the passage of time she had no specific recollection of incurring those charges.

She then went on to suggest that because the card was sometimes kept at the plaintiff’s house he certainly could have used the card on those occasions and invited the Court to draw that inference. [ 20 ] I am not prepared to do so. After reviewing the charges in their totality, the nature and frequency of the charges made, and the recurring pattern of use, I can come to no other conclusion but that the card in question was used exclusively by the defendant.

She cannot point to a single purchase that was obviously incurred by the plaintiff. [ 21 ] By comparison, many of the purchases that she infers were made by the plaintiff relate specifically to shops where she had previously frequented (Le Chateau, Suzy Shier and Claire’s Boutique to name a few).

On other occasions the disputed charges related to the defendant’s specific needs which according to Exhibit P3, Appendix D included charges as late as October 7, 2010 to Funeral and CSC of Sask. (The defendant was employed as a funeral director at that time). [ 22 ] In answer to the defendant’s second defence, I find that all of the charges to the card were incurred by the defendant. [ 23 ] I am, however, satisfied that a number of those purchases were incurred for the joint benefit of the parties.

They continued to date well after July of 2009, either by going out for dinner or by spending time and meals at each other’s home. At trial the plaintiff acknowledged that, in his view, $817.00 was incurred by the defendant for his use, which constituted his share of groceries purchased. [ 24 ] In addition, the defendant indicated that when they were dating she also paid 80% of the restaurant meals they shared. The plaintiff asserted that she was wrong and that he paid for 50% of the meals, but by debit card. Again I prefer the defendant’s evidence on this point. By all accounts she quite enjoyed using the card.

In addition, during this time she was earning at least three times as much as the plaintiff’s meagre ($9,000.00) yearly salary. It stands to reason to me that the person most capable of paying for the meals paid more frequently. [ 25 ] I have reviewed the charges made on the card for dinner dates and can identify a number of occasions during their relationship where it appears that the bill would be sufficiently high to confirm the charges of two people. These charges equate to about $1,100.00.

If the defendant paid for 80% of those meals, then the plaintiff derived a further net benefit of $385.00 through the use of the card. I conclude there that if the defendant owes monies on the card, that sum should be reduced by the sum of $1,202.00. 3. If there is a principal sum which remains due and owing by the defendant what is that sum? Should the defendant be obligated to pay the interest charges which accrued on that sum after a specific date? [ 26 ] Having regard to the invoices provided at trial (Exhibit P3 and Appendix

D) by the end of July 2009 the total purchases (which include cash advances) on the card equated to $8,745.56. Interest had accrued (at 18.5%) in the amount of $141.66, and total payments had been made totalling $5,201.80.

The balance on the card equated to $3,684.30. [ 27 ] As indicated, the defendant had by this time ceased to co-habit with the plaintiff, but the plaintiff did not cancel the card ... something which he would have had the right to do as a primary holder of the card. [ 28 ] By the time the defendant and plaintiff finally ceased dating (the end of April 2010), additional purchases on the card equated to $11,092.44. Interest had accrued in the amount of $1,335.63 and payments made equated to $5,252.04. The balance owing on the card by the end of April sat at $10,866.10.

[ 29 ] Even though the parties had now ceased dating, the plaintiff did not cancel the card. [ 30 ] The defendant continued to make sporadic payments on the card. By the end of October 2010 a further $589.47 was charged to the card. Interest had accrued in the further sum of $968.21 and payments had been made on the card in the sum of $1,459.00.

The balance owing at the end of October 2010 was $11,186.82. [ 31 ] The remaining invoices up until date of trial were not provided to the Court but the defendant provided evidence to show that she made further payments on the card up until May 3, 2011, totalling $1,215.00. [ 32 ] The documentation filed with the Court therefore evidences that the total payments made toward the card’s indebtedness to the end of May 2011 equated to $13,127.84. This is in excess of the defendant’s assertion that in total she paid $10,820.25.

The numbers are not easily reconciled and it may be of no consequence. [ 33 ] The essential fact is that by the end of October 2010, the parties had ceased to date for approximately six months. The balance owing on the card equated to $11,186.82 and, at a newly imposed interest rate of 19.9% and additional late charges, the monthly interest accruing equated to approximately $186.00 and was growing. The payments that the defendant continued to make until May of 2011 were barely satisfying the interest obligation. [ 34 ] The defendant says that she quit making payments on the credit card for two reasons.

First, she says that she had kept a current account of the debt in her head. That is to say, she felt comfortable that she was tracking her use of the card carefully and making payments as required and in accordance with her feeling as to how much debt she had acquired since the last payment. Second, she insists that notwithstanding her repeated requests and then demands, the plaintiff failed and refused to provide her with the actual invoices that she required to validate her indebtedness. [ 35 ] This is not quite accurate.

She conceded at trial that the plaintiff was agreeable to allowing her to access the invoices, but that the invoices were kept at his parent’s house (his mailing address) and therefore if she wanted to see them she would have to go there. [ 36 ] The defendant says that she flatly refused to do so because the plaintiff’s parents despised her, and that her attendance at their residence would be extraordinarily uncomfortable.

The situation, she says, was so bad that even when she and the plaintiff were dating she would have to stay in the car and keep out of sight of the parent’s home for fear of them seeing her. [ 37 ] The plaintiff disputes that he ever told the defendant that the invoices were available for either pick up or inspection at his parent’s house and says rather that they were at his house and if she wanted to see them she could simply come to his house and get them. He did however confirm to the Court that his parents disliked the defendant and her attendance at his parent’s house would be extremely uncomfortable.

The reason for this was not clearly articulated at trial but had something to do with the parent’s deep affection for the woman (now deceased) that the plaintiff had been seeing before dating the defendant. [ 38 ] The defendant insists that she asked the plaintiff to deliver the invoices to her either personally or by mail. The plaintiff concedes that he was adamant that she had to come to his house (his parent’s house?) to obtain them. [ 39 ] This dispute went on for some time.

The defendant says that her efforts to obtain this information ... short of prostrating herself before the plaintiff and his parents ... extended even to the point of her contacting the credit card company by mail to obtain the information. She was subsequently denied access to the information by the credit card provider because she was not the primary holder of the card and therefore not privy to the contract between the plaintiff and the company. [ 40 ] In the absence of a fair and true accounting of her debt the defendant advised the plaintiff in early May of 2011 that she felt her debt was paid.

She did not make any further payments. [ 41 ] The Court was not provided with any evidence of the debt as it stood in May of 2011, but the amount of money that the defendant paid between October of 2010 and May of 2011 was $1,215.00. Interest was accruing over six months at about the rate of $185.00 per month. The two roughly offset each other and I conclude therefore that the amount owing on the card at this time was $11,000.00. [ 42 ] The parties ceased to cohabit in July of 2009 and the plaintiff did not cancel the card.

The parties ceased to date by April of 2010 and still the plaintiff did not cancel the card. By the fall of 2010 the plaintiff knew that the defendant was pregnant by another man (the plaintiff’s boyhood friend) and was seeing him. He did not cancel the card. The defendant advised him in May of 2011 that she was not going to pay any more money and still he did not cancel the card. [ 43 ] The plaintiff gave no explanation for this except to say that he was being a nice guy. He said however that about eight months after the defendant gave her ultimatum he realized that she was not going to make any more payments.

He cancelled the card in early 2012. [ 44 ] With the aid of his parents, the plaintiff started to pay down some of the debt and in July of 2012 he managed to obtain a new credit card with an interest rate of 11.99%. He was able to transfer the existing debt to that card. Finally, after almost two years post ultimatum he sent the defendant a demand letter seeking repayment. She refused and he brought this action on February 19 of 2013.

She did not get to see the invoices until the Case Management Conference. [ 45 ] When the plaintiff was asked at trial to explain his delay, he steadfastly maintained that he was unable to locate the defendant. She had married the father of her child, cancelled her cell phone, and moved to Southey about thirty minutes from Regina.

[ 46 ] The defendant takes issue with his inability to find her. She maintains that he certainly knew where she lived in 2010 since he had helped her move there. She says they had friends in common and in fact one of them lived a scant four doors away from her home. [ 47 ] I share the defendant’s concerns. The plaintiff must have known that his girlfriend was a funeral director. There cannot be that many funeral directors in Regina. The plaintiff had dated the defendant for at least a year and a half. He must have known her parent’s address or phone number.

Regardless of these matters, it still does not explain why he did not, at the very outset, simply give her the information she needed to deal with her indebtedness. [ 48 ] The plaintiff states that in total he has paid $7,008.00 towards the indebtedness. He submitted the most recent statement for the card at the close of trial.

That statement reflects a debt still due and owing equal to $8,382.00 after his most recent payment of $200.00. [ 49 ] From these numbers I conclude that the total of the interest incurred on the card since May of 2011 can be determined by adding the plaintiff’s payment of $7,008.00 to the existing balance on the card of $8,382.00 plus $200.00 and then subtracting the balance of $11,000.00 on the card in May of 2011.

This equates to $4,590.00. [ 50 ] I am of the view that under the terms of the agreement entered into between the parties, the plaintiff was obligated to provide the defendant with a timely and accurate accounting of her indebtedness. [ 51 ] The procedure by which this specific term had to be complied with following an unanticipated break up was not spelled out by the parties. [ 52 ] It is a rather basic principle of contractual

interpretation that where a contract is silent on the manner of its compliance, a Court should look to what was reasonably understood between the parties, having regard to the purposes of the agreement.

The analysis is an objective one. [ 53 ] The purpose of this agreement was to provide the defendant with access to credit with a corresponding obligation on her part to pay that debt off so that the plaintiff was not saddled with that obligation. [ 54 ] Objectively viewed I think any reasonable person would conclude that the plaintiff in turn had the obligation to take every reasonable step to ensure that the defendant was, in a timely fashion, fully aware of her obligation. [ 55 ] I am of the view that the plaintiff’s insistence that the defendant, now in a different relationship and pregnant with another man’s child would have to attend on him at his house (or his parent’s house) as a precondition to obtaining that information, was unreasonable. [ 56 ] His position is the more unreasonable because his available alternatives, which would no doubt have been happily accepted by the defendant, would include, among other things, mailing her the documents; leaving them at her place of work; meeting with her for coffee and handing them to her, or leaving them at her parent’s house. [ 57 ] In my view the plaintiff did not comply with the terms of this agreement.

He failed to provide the defendant with the information sought, and he certainly failed to do so within a reasonable time. By failing to do so he effectively precluded her from taking timely and substantive steps to reduce her then existing debt burden. [ 58 ] On that basis, he cannot now maintain that his failure to act, which resulted in an unreasonable accumulation of interest on the principal debt, should nevertheless be the defendant’s responsibility. [ 59 ] I am therefore satisfied that the defendant is not responsible for any of the interest and/or other charges that accrued on the card after May 3, 2011.

CONCLUSION [ 60 ] Notwithstanding the defendant’s attempts to pay down the debt that she incurred based on her best guess analysis and the sometimes assistance of the plaintiff, the payments that she made over time did not offset the actual purchases charged to the card let alone the interest which accrued on that card. [ 61 ] The defendant derived the benefit of the purchases charged to the card with the exception of the sum of $1,202.00. [ 62 ] The defendant’s obligation under the agreement was to be responsible for all charges and interest which accrued on the card, which, as at May of 2011, stood at $11,000.00.

After deduction of the sum of $1,202.00 that amount is reduced to $9,798.00. [ 63 ] The defendant is not responsible for any interest or charges after that time. [ 64 ] The plaintiff shall have judgment against the defendant in the sum of $9,798.00. [ 65 ] The plaintiff is also entitled to pre-judgment interest on that sum calculated from May 3, 2011, which equates to $219.70. [ 66 ] As the plaintiff has been successful in this action, he is awarded his legal costs which this Court assesses in the sum of $300.00.

P. Demong, J