2017 QCCQ 11279, 2017 QCCQ 11279

Clockwise Financial Corporation c. Levine 2017 QCCQ 11279 COURT OF QUEBEC CANADA PROVINCE OF QUEBEC DISTRICT OF MONTREAL TOWN OF MONTREAL Civil Division No: 500-22-233160-160 DATE: September 13, 2017 ______________________________________________________________________ PRESIDED BY THE HONOURABLE DAVID L. CAMERON, J.C.Q. ______________________________________________________________________ CLOCKWISE FINANCIAL CORPORATION Plaintiff v.

MITCHELL LEVINE Defendant ______________________________________________________________________ JUDGMENT GIVEN FROM THE BENCH ______________________________________________________________________ [ 1 ] The case is for the payment of an amount owing in virtue of a promissory note and a suretyship entered into by the Defendant for 40% of this promissory note, Exhibits P-2 and P-3 respectively.

This 40% amounts to $65,425.60, which amount is also consistent with an acknowledgement of indebtedness signed April 22, 2016, Exhibit P-4. [ 2 ] The defence raised in paragraph 38 of the Case Protocol is one that actually attacks the consent given in respect of the obligations that are referred to in these exhibits.

Reference is made to false representations, lesion, error, conflict of interest, and breach of fiduciary duties. [ 3 ] The Defendant, having admitted the indebtedness, formally, in these proceedings testified on another defence totally inconsistent with the formal defence initially raised, namely that through one of the partners in these business dealings, Mr. Edward Eisenberg, an agreement was reached so that Mr. Levine’s indebtedness, which Mr. Levine now states is in the order of approximately $30,000.00, would be paid only at some future date if and when he, meaning Mr.

Levine, got his business back on its feet. [ 4 ] Mr. Levine asserts in his testimony that this rather open-ended modality was agreed to through a discussion between the two men, Mr. Levine and Mr. Eisenberg, but that later Mr. Eisenberg and the other partner in the venture, Mr. Ronald Lisak, proposed an additional matter which would have been some form of guarantee securing the debt over real estate owned by Mr. Levine’s wife. Mr.

Levine asserts that his wife would not agree to such a guarantee but he asserts that he nevertheless is entitled to an ongoing forbearance with respect to his indebtedness in virtue of that first agreement that he alleges he made with the Plaintiff though Mr. Eisenberg. [ 5 ] The testimony in response to this defence by both Mr. Eisenberg and Mr. Lisak is both subtly and significantly different from Mr. Levine’s recollection. They assert that when Mr.

Levine proposed that he be allowed to abstain from paying the debt until his business would be back on its feet, that they did not accept this but, as a counter-proposal, said that they would forbear on the collection of the debt so long as they had a guarantee that would secure the debt in case of sale or refinancing of these family properties owned by Mr. Levine’s wife and through many conversations and emails, etc., they attempted to go forward with that more complex arrangement of a forbearance coupled with a guarantee but that Mr.

Levine never committed to it and delayed the process and eventually dropped out of the discussions. [ 6 ] The Court must consider that the Defendant has the burden of proof on the existence of any agreement that would modify the obligations that he has admitted in the written proof and in his admission made formally here at trial.

In order to meet this burden of proof, he must bring admissible evidence which would satisfy the Court on the balance of probabilities that the existence of this new modality concerning the payment of his debt is real and constitutes an agreement to which the Plaintiff consented. [ 7 ] His ability to make that case on the balance of probabilities is weakened firstly by the inconsistence of this defence with the defence that was formally and formerly raised in the written proceedings.

It is weakened as well by the fact that there is no commencement of proof, partial evidence or written evidence of such an agreement having been made, and it is weakened by the fact that his testimony is vague as to when precisely such an agreement would have been made.

[ 8 ] There is also an inherent weakness in the defence because it would not make sense for serious business people to make that kind of open-ended agreement to forbear on a significant debt without some form of assurance that they could eventually collect in a manner that was more secure than what they were essentially giving up, which was the possibility of calling for the payment of the debt at any time. [ 9 ] So before even considering the response to this defence, the Court would have to conclude that the Defendant has quite severe difficulties in meeting his burden of proof on the balance of probabilities.

As well, having heard the testimony of the two representatives of the Plaintiff, Mr. Eisenberg and Mr. Lisak, the Court notes that the testimonies concord with each other, Mr. Lisak’s testimony being far more detailed but essentially to the same effect as the testimony of Mr.

Eisenberg. [ 10 ] It is not necessary for the Court to say whether it believes the Defendant or these representatives of the Plaintiff, except to say that, even if the testimony of the latter is equally credible, the Defendant’s case fails because it is he who has the burden of proof. [ 11 ] However, given the more coherent narrative given by Mr. Eisenberg and Mr. Lisak and, subjectively, in terms of the Court’s assessment of their demeanor, if necessary, the Court would have to say that the response given by the Plaintiff is more probable.

Even if the Plaintiff had the burden of proof, at the end of the day, the case would have gone to the Plaintiff in those circumstances. [ 12 ] So, for those reasons, the Plaintiff’s action succeeds and the defence fails. WHEREFORE, THE COURT: CONDEMNS the Defendant to pay the Plaintiff the sum of $65,425.60, with interest at the legal rate of 5%, and the additional indemnity provided for in

article 1619 C.C.Q., calculated from the date of the formal demand, which is August 3, 2016; Together with legal costs. __________________________________ DAVID L. CAMERON, J.C.Q. Me Antonin Roy SPIEGEL SOHMER Attorneys for Plaintiff Mitchell Levine, without representation by a lawyer Date of hearing: September 13, 2017