Executive Summary: Key Legal and Evidentiary Issues

• Journey Capital Inc. moved for default judgment against Guy Chartrand, who personally guaranteed a $100,000 loan made on February 29, 2024.

• Service of the Motion Record was deficient, as it was sent by regular mail rather than by personal service as required under Casa Manila Inc. v. Iannuccilli, 2018 ONSC 7083.
• Original service of the Statement of Claim was also flawed, having been served on Marlene Chartrand — described as an adult member of the same household — rather than on the defendant personally.
• The Motion Record lacked a draft Judgment, which was required under the process established by Justice Koehnen's February 26, 2026 Endorsement.
• Pre-judgment interest of 47.03% per year was claimed under the agreement, raising a potential conflict with the federal criminal interest rate cap of 35% under s. 347 of the Criminal Code.
• No Bill of Costs was included in the Motion Record, Factum, or uploaded to Case Center, despite costs being sought on a partial indemnity scale.

Facts of the case

Journey Capital Inc. is the plaintiff in a lending dispute against Guy Chartrand, also known as Guy Joseph Chartrand and Guy J. Chartrand. Chartrand was the president and CEO of Freight World Logistics Inc. and personally guaranteed repayment of a $100,000 loan made by Journey Capital Inc. on February 29, 2024. Under the loan terms, repayment was to be made in weekly installments of $2,052.46 over 65 weeks. Chartrand defaulted on January 2, 2025, at which point the outstanding balance stood at $53,681.67.

Contractual and procedural terms at issue

The loan agreement provided for pre-judgment interest at a rate of 47.03% per year. Journey Capital relied on Lundy's Regency Arms Corp. v. Niagara Hospitality Hotels Inc., 2016 ONSC 4199 in support of this claimed rate. Justice Dow noted, however, that the more recently enacted federal legislation renders interest exceeding 35% per year a violation of s. 347 of the Criminal Code. He also observed that Lundy's itself considers s. 130 of the Courts of Justice Act, R.S.O. 1990, c. C.43, which permits the court to vary all or part of any pre-judgment interest claim. Separately, the matter had been governed by a process established through Justice Koehnen's February 26, 2026 Endorsement, which prescribed the steps the plaintiff was required to follow to obtain an in-writing default judgment.

Court's reasoning and analysis

Justice Dow identified four distinct deficiencies in the plaintiff's Motion Record. First, the Endorsement of Justice Koehnen required the Motion Record — together with a copy of that Endorsement, the Noting in Default, and the draft Judgment — to be personally served on the defendant in accordance with Casa Manila Inc. v. Iannuccilli, 2018 ONSC 7083. Instead, the legal assistant's Affidavit of Service disclosed that the material was sent only by regular mail to the same address where the Statement of Claim had originally been served — not on the defendant himself, but on Marlene Chartrand as a person who appeared to be an adult member of the same household. Second, neither the Motion Record nor any other material uploaded to Case Center contained a draft Judgment, as expressly required. Third, although the Factum sought pre-judgment interest at 47.03% per year under the agreement, this rate conflicts with the federal criminal interest rate ceiling of 35% per year under s. 347 of the Criminal Code, and the plaintiff's submissions on this point were inadequate. Fourth, the Factum referred to costs being sought on a partial indemnity scale as particularised in Journey's Bill of Costs, yet no Bill of Costs was included in the Motion Record, Factum, or uploaded to Case Center.

Ruling and overall outcome

Justice Dow dismissed the plaintiff's motion on June 16, 2026. The dismissal was without prejudice, meaning Journey Capital Inc. may renew its motion on fresh material that addresses each of the deficiencies identified. Justice Dow also directed that the Endorsement be brought to the attention of the judge who hears the matter on any future return, and confirmed that he is not seized of the matter going forward. No amount was ordered or awarded at this stage; the motion did not succeed.