Executive Summary: Key Legal and Evidentiary Issues

• Summary judgment was appropriate because the affidavits and cross-examination transcript allowed the court to make the necessary findings of fact without a trial.
   
• Mr. Patel's affidavit was found minimal, vague and made up of bald allegations, while the evidence of CIBC's relationship manager, tested on cross-examination, was preferred where the two conflicted.
   
• Independent legal advice was not required before signing the guarantee, since Mr. Patel was the sole shareholder and director of the borrowing company and there was no evidence he asked for time to obtain it.
   
• Defences of non est factum, duress, undue influence and a language barrier all failed for lack of supporting evidence.
   
• CIBC owed no fiduciary duty to the defendants, as their relationship was a purely commercial one of creditor and debtor.
   
• Under paragraph 9 of the Guarantee Agreement, CIBC was not required to realize on its security before pursuing the guarantor.
   

Facts of the case

On June 9, 2022, Canadian Imperial Bank of Commerce (CIBC) offered 12509237 Canada Inc. o/a WingsUp! Brantford (125) a loan of $349,640.00, plus interest, under the Canada Small Business Financing Act. Ankitkumar Patel, also known as Ankitkumar Natvarlal Patel, was 125's sole owner and director, and he accepted the offer on the company's behalf on June 10, 2022. The loan agreement described its purpose as "equipment/leasehold improvements" and called for 120 monthly payments of $2,913.66 each, plus interest. According to the decision, 125 applied for the loan in order to open a WingsUp! franchise.

That same day, Mr. Patel signed a guarantee of 125's indebtedness capped at $87,410.00, plus interest from the date of demand. He signed the "Certification and Consent of Guarantor(s)" portion of the loan documents on June 13, 2022. As required by the loan process, 125 granted CIBC a charge over its present and after-acquired property under two security agreements, and CIBC registered a financing statement under Ontario's Personal Property Security Act.

Monthly payments ran from June 15, 2022 to March 21, 2024, after which 125 stopped paying. When CIBC relationship manager J. Singh called on April 30, 2024, Mr. Patel said a dispute between 125, its franchisor and its landlord meant he could make no further loan payments until it was resolved. On May 15, 2024, CIBC demanded $302,842.24 from 125, calculated as at May 14, 2024, and $87,410.00 from Mr. Patel under the guarantee. It issued a statement of claim on August 26, 2024 and moved for summary judgment on July 21, 2025.

In opposition, it was submitted on Mr. Patel's behalf that he was called to the branch on short notice, told the financing could be withdrawn if he did not sign immediately, denied a fair opportunity to get independent legal advice, not given a proper chance to review the documents, given no plain-language explanation, and discouraged from asking questions. His own affidavit nonetheless admitted that he was 125's sole director, that he signed the loan and guarantee agreements, and that 125 received the full $349,640.00. The third parties, Chooch's Inc. a.k.a. WingsUp!, Chooch's (Brantford) Inc., Chooch's (Brantford 2) Inc., 2310685 Ontario Inc. and Ryszard Witulski, took no position and did not participate in the hearing.

Policy and legislative provisions at issue

Several contractual terms shaped the dispute. The guarantor certification, which Mr. Patel signed, stated that he would "personally (jointly and severally)" guarantee the obligations of the business to CIBC, and the form added that CIBC would not extend credit without the personal guarantee of each key principal. Above his signature on the loan agreement, a "Business Acceptance" clause recorded that each person signing on the business's behalf acknowledged having received and read CIBC's "Small Business Credit Terms and Conditions" booklet.

Under the loan agreement, CIBC had to give notice of default and at least 10 days to cure it, reduced to three days for a failure to pay an amount when due. If the default was not fully remedied in that time, the outstanding balance became due without further notice. Paragraph 9 of the Guarantee Agreement, titled "Exhausting Recourse," provided that CIBC did not need to exhaust its recourse against the customer, any other person, or any security before being entitled to full payment from the guarantor. The next clause, "Absolute Liability," made the guarantor's liability absolute and unconditional and stated that CIBC would not owe him any duty, as a fiduciary or otherwise.

Procedurally, the motion turned on Rule 20.04(2)(a) of Ontario's Rules of Civil Procedure, which requires summary judgment where there is no genuine issue requiring a trial, and Rule 20.04(2.1), which allows a judge to weigh evidence, assess credibility and draw reasonable inferences.

Reasoning and analysis

The court found the record, consisting of affidavits from Mr. Singh and Mr. Patel plus the transcript of Mr. Singh's cross-examination, sufficient to decide the case fairly without a trial. Credibility weighed heavily. Mr. Singh had been cross-examined without his evidence being challenged in any meaningful way, while Mr. Patel's account existed only in an affidavit that was minimal, vague and lacking important particulars. CIBC also submitted that the defendants did not attend for cross-examination on that affidavit. Where the two accounts conflicted, the court preferred Mr. Singh's evidence.

That evidence showed a lengthy, collaborative application process. Mr. Singh took over the file around January 2022, worked with Mr. Patel and two franchisor representatives through emails spanning March 2 to June 9, 2022, met Mr. Patel in person in mid-May 2022 and explained then that he would be personally guaranteeing the corporate loan. After approval on June 8, 2022, the two reviewed the loan and guarantee terms again by telephone, and it was Mr. Patel who asked to sign at the Brantford branch rather than Mr. Singh's Mississauga office. While payments were being made from June 2022 to March 2024, Mr. Patel raised no concerns about the agreements or CIBC's lending process, and his first formal objection to the guarantee came only after CIBC demanded repayment.

On independent legal advice, the court noted there was no evidence Mr. Patel asked CIBC for time to get it or that such a request was refused. Citing Meridian Credit Union Limited v. 2428128 Ontario Limited, it held that such advice is not required where the guarantor is an officer and director of the borrowing corporation. Relying on Business Development Bank of Canada v. ROC Ice Cream Inc., it added that a lack of independent legal advice does not invalidate a guarantee without evidence of non est factum, unconscionability, fraud, misrepresentation or undue influence, and there was no such evidence here.

Non est factum failed because nothing suggested Mr. Patel thought he was signing something fundamentally different from a loan and guarantee. His affidavit said only that he did not "fully understand the legal and financial terminology," and it never stated he would not have signed had the documents been explained. Nor did it name who discouraged his questions or identify which questions went unanswered. A bank, the court added, may rely on a corporate director knowing what they are doing.

Duress was rejected as well. The application predated Mr. Singh's involvement in January 2022, approval came on June 8, 2022, and the court found no indication that anyone from CIBC rushed or pressured Mr. Patel. The emails showed it was the franchisor's representatives who asked for the documents to be executed as soon as possible. Mr. Patel's later conduct also undercut the claim: in or around June 2023 he sought help obtaining a second line of credit, and later in 2023 he brought a friend to Mr. Singh's office to learn about the application process. The court characterized the deal as an ordinary commercial transaction between a bank and an experienced businessman, adopting language from Bauer v. Bank of Montreal.

Undue influence was unsupported, since Mr. Patel was copied on or forwarded the relevant emails and on occasion replied himself. A submission by his counsel that CIBC had promised to pursue the security assets first, sparing him from paying the full guarantee, had no evidence behind it. On the language issue, all documents in the defendants' responding record, Mr. Patel's affidavit included, were in English, as were the written communications in the record. Mr. Singh acknowledged on cross-examination that Mr. Patel was more fluent in Hindi, but his uncontroverted evidence was that he sometimes spoke with Mr. Patel in Hindi and explained certain terms in Hindi as well as English. Nothing in the evidence showed Mr. Patel asked for translation, and the court held that a party who is careless or reckless in failing to inquire into a document cannot escape liability by showing he did not know what he was signing.

The remaining arguments were dismissed in turn. CIBC owed no fiduciary duty in a purely commercial creditor-debtor relationship, and there was no evidence of misrepresentation or of CIBC refusing to disclose information. Paragraph 9 of the guarantee, together with the discretion CIBC held under the security agreements, meant the bank need not realize on the assets before suing Mr. Patel. The defendants identified no statutory provision obligating CIBC to submit a claim under the Canada Small Business Financing Act. Keeping only electronic copies of the signed agreements was irrelevant, given Mr. Patel's admission that he signed them and the absence of evidence that hard copies were required. Gaps in CIBC's log notes caused no prejudice because Mr. Singh gave that evidence directly and was cross-examined on it.

Ruling and overall outcome

CIBC succeeded on its motion for summary judgment. The court ordered 125 to pay the principal sum of $310,066.69, plus prejudgment interest from August 22, 2024, and Mr. Patel to pay $87,410.00 under his guarantee, plus prejudgment interest from May 15, 2024. Postjudgment interest on both amounts compounds monthly at the CIBC Prime Rate plus 2.5%. Interest was not quantified, and the reasons do not explain how the $310,066.69 principal relates to the $302,842.24 demanded in May 2024. As the successful party, CIBC is presumptively entitled to costs, but no amount was fixed. The parties were urged to agree, failing which written submissions were due between October 23 and November 13, 2026, and if none are received by November 13, 2026, the costs issue will be deemed resolved. No single combined total of the amounts owed was stated in the decision.