Citation:

Hull Limited v. Vancouver Career College

(Burnaby) Inc.,
2014 BCSC 277
Date: 20140220
Docket: S130064
Registry: Vancouver

Between:
Hull Limited
Plaintiff
And
Vancouver Career College (Burnaby) Inc.
Defendant
Before: The Honourable Mr. Justice Pearlman

Reasons for Judgment

Counsel for the Plaintiff:

Gordon G. Plottel

Counsel for the Defendant:

Kevin A. McLean

Place and Date of Summary Trial:

Vancouver, B.C.
February 12, 2014

Place and Date of Judgment:

Vancouver, B.C.
February 20, 2014

2014 BCSC 277 (CanLII)

IN THE SUPREME COURT OF BRITISH COLUMBIA

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Page 2

INTRODUCTION
[1]

This is a second application by the plaintiff Hull Limited for summary trial and

the amount of $125,000, together with interest at the rate of 8% per annum from
November 30, 2010 to the date of judgment.
[2]

On this application, the plaintiff claims that Mr. Anthony Hull, who is a Director

of Hull Limited, originally loaned $125,000 to LearningWise Inc. ("LINC"). The

plaintiff says that by a Novation Agreement made November 18, 2008, VCC
assumed the obligations of LINC to repay the loan to Mr. Hull, and that he later
assigned the loan to the plaintiff. It is common ground that the defendant has not
repaid the loan, despite the plaintiff's demand that it do so.
[3]

For its part, the defendant contends that there are material conflicts in the

affidavit evidence that make this matter unsuitable for disposition by summary trial.
VCC says it should have an opportunity to cross-examine Mr. Hull on his affidavits
before the Court decides the case on the merits.
[4]

The defendant also argues that the plaintiff has not produced the loan

agreement or any other instrument establishing that either Anthony Hull or Hull
Limited actually made the loan, and that without production by the plaintiff of any
document proving the loan, the Court is not in a position to find the facts necessary
to dispose of this application. VCC also submits that contrary to Rule 3-7(6), the
plaintiff's Amended Notice of Civil Claim pleads facts that are inconsistent with its
previous pleading.
HISTORY OF PROCEEDINGS
[5]

Before addressing the issues arising on this application, it is necessary to

briefly set out the history of this proceeding.

[6]

On June 11, 2013, the plaintiff filed its first application for judgment on the

loan and set that application down for hearing on June 27, 2013.

2014 BCSC 277 (CanLII)

judgment against the defendant Vancouver Career College (Burnaby) Inc. ("VCC") in

Hull Limited v. Vancouver Career College (Burnaby) Inc.

[7]

Page 3

Earlier, on April 19, 2013 the plaintiff, by its counsel, had put the defendant on

notice that it intended to bring a summary trial application, and that if the defendant
wished to take any pre-trial steps, it should do so promptly. The plaintiff gave notice

summary trial if the defendant failed to take steps to prepare after receiving notice.
[8]

At the urging of defendants counsel, the plaintiff adjourned the summary trial

to August 6, 2013 to permit the defendant time to file affidavit materials in response
to the summary trial application.
[9]

The defendant did not file any affidavit evidence in response to the plaintiffs

first summary trial application. However, on July 5, 2013, the defendant filed an
application for security for costs, to be heard on August 6, 2013. The plaintiff is a
corporation registered under the laws of Guernsey, in the Channel Islands. The
defendant asserted the plaintiff had no exigible assets in British Columbia.
[10]

The defendant filed affidavits in support of its application for security for costs

on July 23 and July 31, 2013. When the applications of the plaintiff and the
defendant came on for hearing on August 6, 2013, the Court determined that the
summary trial application should proceed first, on the basis that if the plaintiff were
successful on that application, there would be no necessity to hear the application
for security for costs.
[11]

On the first summary trial application, Mr. Hull deposed that he had arranged

for Hill Limited to make the loan to LINC. However, some of the documents
attached as exhibits to Mr. Hulls affidavit #1, to which I will return later in these
Reasons, referred to repayment of the loan to Mr. Hull personally, rather than to the
plaintiff.
[12]

The defendant argued that the plaintiff had failed to prove whether the lender

was Mr. Hull or Hull Limited, and that the case was not suitable for disposition by
summary trial where there was no evidence of any assignment of the loan from
Mr. Hull to Hull Limited.

2014 BCSC 277 (CanLII)

that it would oppose any application by the defendant for an adjournment of the

Hull Limited v. Vancouver Career College (Burnaby) Inc.

[13]

Page 4

After counsel completed their submissions on August 6, 2013, I adjourned the

proceedings to 3:30 p.m. that afternoon, when I anticipated delivering oral Reasons
for Judgment. When the hearing reconvened, defence counsel produced from

purporting to be an assignment of the loan from Mr. Hull to the plaintiff. Neither
party had listed the assignment agreement. It was not before the Court as an exhibit
to an affidavit. Following production of the assignment document, I determined that
the parties should have the opportunity to investigate the circumstances in which
that document came into existence, and its validity. In the result, the Court
dismissed the plaintiffs summary trial application, with liberty to reapply.
[14]

The plaintiff determined that Mr. Hull had made the assignment of the loan to

Hull Limited, amended its Notice of Civil Claim accordingly, and filed its second
application for summary trial on September 30, 2013. Although that application was
initially set down for hearing on November 21, 2013, for reasons beyond the control
of the plaintiff or the Court, that hearing was ultimately adjourned to February 12,
2014.
ISSUES
[15]

The following issues arise for determination on this application:

(a)

Is this an appropriate case for determination by summary trial?

(b)

Has the plaintiff proven the loan to LINC?

(c)

Has VCC assumed the obligation to repay the loan, and is the loan,
together with interest, now due to the plaintiff?

DISCUSSION
The Plaintiffs claims
[16]

By its Amended Notice of Civil Claim filed August 26, 2013 Hull Limited

pleads the following allegations of fact relating to the loan:

2014 BCSC 277 (CanLII)

documents provided to him by his client, a copy of a document dated April 30, 2010

[17]

3.

Prior to September, 2008, the Plaintiff, or alternatively Anthony

Hull, loaned to LearningWise Inc. ("LINC"), a company affiliated
with the Defendant, $125,000 (the "Loan").

4.

The terms of the Loan provided that it would be repaid in full on

or before November 30, 2010 (the "Original Due Date").

5.

In or about September, 2008, the Defendant acquired a

controlling interest in LINC by way of certain transactions. As a
result, a novation agreement, as set out in a letter dated
November 18, 2008, between representatives of the Plaintiff, or
alternatively Anthony Hull, and the Defendant and LINC, was
entered into (the "Novation Agreement").

6.

Pursuant to the Novation Agreement, the Defendant confirmed

its agreement to assume LINC's obligations to repay the Loan.
Further, the Novation Agreement provided that if the Loan was
not repaid by the Original Due Date, it would commence
accruing interest at the rate of 8% per annum, and be repaid in
full, with all accrued interest, no later than November 30, 2012
(the "Extended Due Date"). The Defendant confirmed its
obligation in the Novation Agreement to repay the Loan in full,
including all accrued interest.

6A.

The Loan was assigned by Anthony Hull to the Plaintiff by

written assignment dated April 30, 2010. Notice of such
assignment was given to the Defendant, and acknowledged in
writing by counsel for the Defendant on August 18, 2011.

7.

The Defendant failed to pay all, or any, of the Loan by the

Original Due Date. The Defendant also failed to pay all, or any,
of the Loan, or the interest accrued on the Loan, by the
Extended Due Date.

Page 5

In paragraphs 8 and 9 of the Amended Notice of Civil Claim, Hull Limited

pleads that by letter dated December 19, 2012 it demanded payment in full of the
loan and all accrued interest, that the defendant, after receipt of the plaintiff's
demand, acknowledged the debt, and that the defendant has refused or neglected to
repay the loan.
[18]

In my view, the plaintiffs amended pleadings do not offend the rule against

pleading allegations of fact or new claims that are inconsistent with a partys
previous pleading. Rule 3-7(7) provides that subrule (6) does not affect the right of a
party to make allegations in the alternative, which the plaintiff has done at
paragraphs 3 and 5 of its Amended Notice of Civil Claim. By pleading the

2014 BCSC 277 (CanLII)

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Page 6

assignment of the loan, Hull Limited has simply amended its pleadings to conform
with the evidence. By its amended pleadings, Hull Limited claims against the same
defendant for the same amount on the same cause of action that it pleaded in its

(a)
[19]

Suitability for Summary Trial

On an application for summary trial, the court must be satisfied that it is able,

on the whole of the evidence, to find the facts necessary to decide the issues of fact
or law arising on the application, and that it would not be unjust to decide those
issues by summary trial.
[20]

In each case, the court must determine whether the evidence is sufficient for

adjudication. The court is not obliged to remit a case for conventional trial because
there are conflicting affidavits. Notwithstanding conflicts in the affidavits, the court,
by recourse to other admissible evidence, may be able to find the facts necessary to
give judgment: Inspiration Management Ltd. v. McDermid St. Lawrence Ltd. (1989),
36 B.C.L.R. (2d) 202 at paras. 42, 54, 55 (C.A.).
[21]

I am satisfied on the evidence that I will be able to find the facts necessary to

decide whether or not Mr. Hull made the loan to LINC; whether VCC assumed
LINCs obligation to repay the loan; and whether or not VCC is now indebted to the
plaintiff for the amount claimed.
[22]

Factors for the court to consider in determining whether it would be unjust to

grant relief by summary trial include the amount involved, the complexity of the
matter, its urgency, any prejudice likely to arise by reason of delay, the cost of taking
the case forward to a conventional trial in relation to the amount involved, the course
of the proceedings and any other matters arising for consideration: Inspiration
Management, at para. 48.
[23]

While I am sure that the amount involved is not insignificant to either party,

the cost of a conventional trial would put both parties to substantial additional
expense and would erode the net amount the plaintiff would, if successful, actually

2014 BCSC 277 (CanLII)

original Notice of Civil Claim.

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Page 7

recover on a judgment. Each of the two summary trial hearings consumed less than
a half day of court time. This matter is not complex it involves a claim in debt on a
single loan. The plaintiff commenced this action in January 2013. Although the

matter were referred to the trial list, the plaintiff would be prejudiced if further delay
postponed the recovery of monies ultimately found to be owing to Hull Limited. That
prejudice would be ameliorated by the continued accrual of interest, assuming for
the moment that the defendant has the means to satisfy a judgment, if the plaintiff
prevails.
[24]

Weighing all of these factors, and taking into account my determination that I

am able to find the facts necessary to decide the issues arising on this application, I
conclude that this matter is suitable for disposition by summary trial, and that it
would not be unjust to decide this case under Rule 9-7.
(b)
[25]

Has the plaintiff proven the loan?

The defendant submits the plaintiff's failure to produce a document showing

that Mr. Hull or Hull Limited actually loaned $125,000 to LINC is fatal to the plaintiff's
claim for summary trial and judgment on the debt. In most cases, production of a
written loan agreement and a cheque or other instrument made payable to the
borrower for the loan amount will provide compelling proof of the loan. Here, the
Court must be satisfied, on all of the evidence on this application, that it is able to
find the facts necessary to establish that Mr. Hull made the loan alleged.
[26]

In Whitworth v. Frerichs, 2012 BCSC 1554, a summary trial application for

debt, the plaintiff alleged that he had made two loans to the defendant husband and
wife. The defendant husband disputed one of the loans. Although his wife had
signed a promissory note for that loan, the defendant husband had not done so.
After reviewing the conflicting evidence, Mr. Justice Jenkins concluded that it was
not possible to make the necessary findings of fact and therefore dismissed the
plaintiff's summary trial application. In Whitworth, unlike the case at bar, there was

2014 BCSC 277 (CanLII)

matter may not be urgent, it should be resolved without unnecessary delay. If this

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Page 8

no evidence of an acknowledgement of the debt by the defendant contesting the

loan.
In Gjeorgevski v. Stojkovski, [2006] O.J. No. 127 (S.C.J.), the plaintiff sought

summary judgment for a loan. The plaintiff adduced no documentary evidence of

the loan and the defendant disputed the loan. Nolan J. considered how the court
should determine the issue of conflicting evidence concerning whether the loan was
actually made at para. 28:
In Masini USA Inc. v. Simsol Jewellry Wholesale Ltd., supra, there was no
dispute between the parties that the goods in question were delivered. There
were invoices to reflect the transaction. The dispute involved arrangements
for return of unsold or defective jewellry. There was both documentary
evidence and evidence of ongoing negotiations between the parties. At page
235 of the decision, the court considered how a judge determines a genuine
issue consisting of conflicting evidence as to a material fact:
In one situation, one party might provide apparently reliable documentary
support as to a fact in dispute and the other party might simply assert a
contrary fact without any supporting evidence. In such a case, in principle,
the court could assess whether the corroborative effect of the document is
such that the court can properly find the fact without cross-examination. In
another case, where the court has nothing more to go on than
unsupported mutually contradictory statements of opposing parties, the
court might well need to conclude that cross-examination was necessary.
In the former case, where there is apparently reliable documentary or
other supporting evidence for the evidence of one party but not for the
other, the question for the court would properly be: is there any reason
not to accept the supporting evidence? On this basis, the other party
would in effect be subject to a burden either to provide satisfactory
supporting evidence for its own version or to present a good reason to
doubt the reliability of the supporting evidence provided by the first party.
If the other party fails to discharge the burden, the court would be in a
position to decide to accept the evidence of the first party without
requiring resort to cross-examination.

[28]

In Natco International Inc. v. Photo Violation Technologies Corp., 2009 BCSC

1504, Madam Justice Griffin had to determine whether the plaintiff on a summary
trial application had proved that it loaned to the defendant the amount alleged. The
plaintiff sought judgment for loans totalling $1,485,000. In support of that claim, the
plaintiff relied on the affidavit evidence of one of its officers confirming that the
plaintiff advanced specified amounts on particular dates which totalled $1,485,000.
In addition, the plaintiff produced a loan agreement, and a promissory note by which

2014 BCSC 277 (CanLII)

[27]

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Page 9

the defendant acknowledged that it had received $1,300,000 USD from the plaintiff,
repayable on demand. The defendant filed an affidavit disputing that the plaintiff had
made the loans on the dates alleged. In Natco, at paras. 16-20, the court found that

found that the defendant's position contesting the amount loaned by the plaintiff was
contradicted by its own admissions. Those admissions included the defendants
acknowledgement in its statement of defence and counterclaim that it had received
$1,485,000 advanced from various sources on behalf of the plaintiff, and entries in
its audited financial statements recording the amounts owed by the defendant to the
plaintiff. Natco is distinguishable on its facts from the instant case. There, the
plaintiff did produce a loan agreement and a promissory note for most, but not all, of
the amount claimed. The defendants financial statements supported the plaintiffs
claim.
[29]

The principle I take from these cases is that on the summary trial of a claim in

debt, the court must be satisfied on all of the evidence adduced that it is able to find
the material facts establishing the debt alleged. The plaintiff bears the burden of
proving the debt on the balance of probabilities. Where a loan agreement in writing
is not produced, the court must be satisfied that there is reliable supporting evidence
for the loan, and that any conflicts in the evidence can be resolved without crossexamination or a conventional trial.
Findings of Fact
[30]

By his first affidavit sworn June 7, 2013, Anthony Hull deposed that sometime

before October 2008 he proposed and arranged that Hull Limited would loan
$125,000 to LINC, and that he subscribed for shares in LINC.
[31]

Mr. Hull swore his second affidavit on August 9, 2013, after the defendant had

produced a copy of the assignment agreement of April 30, 2010 at the conclusion of
the August 6, 2013 hearing. At paragraph 5 of his second affidavit, Mr. Hull said
this:

2014 BCSC 277 (CanLII)

the plaintiff had proved its claim in debt for the full amount of $1,485,000. The court

Page 10

After I received the Assignment Agreement from Hull's counsel, I made

investigations of my records, and asked Hull's Director to do the same.
By those investigations, I was able to confirm that, in April 2010 the
Loan was assigned by me to Hull. I had forgotten that the Loan had
been originally made in 2008 by me, in my personal capacity, rather
than by Hull. I now realize that the reference I made to Hull making the
Loan in paragraph 3 of my Affidavit #1 was incorrect. Likewise, my
reference in paragraph 6 of my Affidavit #1 to signing the Assumption
Agreement on behalf of Hull, is incorrect, since the Loan was owed to
me in November 2008, when the Assumption Agreement was signed.
I agreed, in my personal capacity, that VCC would assume the
obligation to repay the Loan. Then, approximately one and half years
later, I assigned the Loan to Hull by the Assignment Agreement.
[32]

In or about October 2008, VCC purchased the majority of the shares in LINC

and acquired control of that company. As part of that transaction, on October 21,
2008, Mr. Peter Chung, the Executive Chairman of the Eminata Group, which
includes VCC, wrote to Mr. Hull to inform him that Eminata was purchasing the
business rights and interests of LINC through the acquisition of the shares of LINC.
Mr. Chung advised that Eminatas offer to purchase Mr. Hulls shares in LINC was
only open for acceptance until October 23, 2008, apologized for the short time frame
for acceptance, and requested that Mr. Hull sign and return the documents required
to effect the share transfer within the time stipulated. Mr. Hull agreed to transfer his
shares in LINC to Eminata, and signed and returned the transfer documents as
requested by Mr. Chung.
[33]

About a month later, on November 18, 2008, Mr. Chung wrote again to

Mr. Hull to confirm that:

VCC has agreed to assume LINC's obligations to repay you $125,000
(the "Hull Loan") which you had previously loaned to LINC, which
amount represents your portion of the "investor loans" ... such
assumption of debt being in exchange for your full and unconditional
release and discharge of LINC in respect of repayment of the Hull
Loan.
[34]

Mr. Chung, on behalf of VCC, also confirmed:

2014 BCSC 277 (CanLII)

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Page 11

... our agreement that the Hull Loan will continue outstanding without
interest and is due and payable in full to you on November 30, 2010,
and if the Hull Loan is not repaid at such time the Hull Loan will
commence accruing interest at the rate of eight percent (8%) per
annum thereafter, and will be repaid in full, along with any unpaid but
accrued interest, no later than November 30, 2012. The initial terms of
the Hull Loan to LINC are hereby amended to the extent necessary to
reflect the foregoing. The foregoing is the entire agreement with
respect to LINC's or VCC's obligations to repay you any amount on
account of the Hull Loan.
[35]

Mr. Hull signed the letter of November 18, 2008 to acknowledge that he had

reviewed, understood and agreed to the terms by which VCC assumed the
obligation to repay the Hull loan. I find that on or about November 18, 2008 VCC,
LINC, and Mr. Hull entered into a valid and binding Novation Agreement by which
VCC assumed LINCs obligations to repay the loan. Mr. Hull provided consideration
for the Novation Agreement by his promise to release and discharge LINC, and by
extending the time to repayment of the loan to November 30, 2012 in exchange for
VCC's promise to pay interest at the rate of 8% per annum if the loan were not
repaid in full by its original due date of November 30, 2010.
[36]

On March 23, 2010, in response to an inquiry from Mr. Hull regarding the

terms for repayment of the loan, Mr. Dan Kriznic, CA, the Chief Financial Officer for
the Eminata Group confirmed that the loan was due November 30, 2010 without
interest and that if it were not repaid by November 30, 2010 the loan would accrue
interest at 8% per annum. Mr. Kriznic also confirmed the loan must be repaid by no
later than November 30, 2012, and that the loan amount was $125,000.
[37]

On April 30, 2010, Mr. Hull made an assignment in writing of all of his rights,

title and interest in the loan to the plaintiff.

[38]

On August 18, 2011, by an e-mail signed by Mr. Drew Lawrenson, the

defendant's Vice President and Senior Counsel, VCC confirmed receipt of notice of
the assignment and advised that the defendant had modified its records to reflect the
assignment.

2014 BCSC 277 (CanLII)

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Hull Limited v. Vancouver Career College (Burnaby) Inc.

[39]

Page 12

I find that the assignment of the debt from Mr. Hull to Hull Limited was

absolute, was made in writing and was signed by the assignor, and that the debtor,
VCC, received notice in writing of the assignment.

Accordingly, the assignment was

requirements of s. 36 (1) of the Law and Equity Act, R.S.B.C. 1996, c. 253.
[40]

On November 29, 2012, Mr. Lawrenson wrote to Mr. Hull by e-mail to confirm

the debt in the amount of $125,000 together with interest, (which he incorrectly
stated was due to Mr. Hull), would become due the following day. Mr. Lawrenson
proposed that the defendant enter into a deferred payment plan with Mr. Hull.
[41]

In subsequent correspondence, the defendant correctly identified the plaintiff

as the party to whom payment was due. On December 18, 2012, Mr. Chad G.
Anderson, associate counsel for Eminata, sent an e-mail to the plaintiff's solicitor
under the caption "Debt owing to Hull Limited" advising that the defendant was
prepared to provide the plaintiff with a copy of its financial statements in exchange
for a non-disclosure agreement in order to "open up a dialogue regarding repayment
of the debt owing to Hull Limited".
[42]

In the result, the plaintiff did not agree to defer repayment of the loan.

[43]

On December 19, 2012, the plaintiff, by its solicitors, demanded that VCC

repay the loan plus interest at the rate of 8% per annum from November 30, 2010 in
the total amount of $145,800. On the same day, Mr. Anderson, on behalf of the
defendant, confirmed that VCC had acknowledged the debt owing to Hull Limited by
e-mail to the plaintiff's solicitor:
We are in receipt of your letter dated December 19, 2012. As you are
aware, Vancouver Career College (Burnaby) Inc. has acknowledged
the debt [owing] to Hull Limited. At this time the debtor is seeking an
extension on the same terms and conditions as the existing debt. We
propose deferring payment of principal and interest until February 28,
2012.
In the event Vancouver Career College (Burnaby) Inc. fails to make the
payment punctually on or before February 28, 2012 your client shall

2014 BCSC 277 (CanLII)

a valid and effective assignment of a legal chose in action, and complied with the

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Page 13

have the right to proceed for collection of the entire amount then
outstanding.
Please let me know if this proposal is something your client is prepared
to entertain.
[44]

The plaintiff was not receptive to the defendants proposal, and commenced

this action on January 7, 2013.

[45]

The defendant has not repaid any of the loan to the plaintiff.

[46]

In response to the plaintiffs second application for judgment, the defendant

filed the affidavit of Mr. Peter Chung, made November 18, 2013. At paragraph 3 of
his affidavit, Mr. Chung agreed that VCC acquired a controlling interest in LINC by
way of certain transactions. Mr. Chung recalled that during those transactions he
spoke by telephone with Mr. Hull who told him that he had personally loaned
$125,000 to LINC, and that the loan formed part of a group of investor loans.
Mr. Chung has sworn that VCC's takeover of LINC occurred within one week and
that the defendant did not receive many of the closing documents from LINC that
would have provided evidence of loans allegedly made to LINC.
[47]

Referring the Novation Agreement of November 18, 2008, Mr. Chung

deposed at paragraph 4 of his affidavit:

I have reviewed Exhibit "B", page 11, of Mr. Hull's Affidavit #1 and I
confirm that is my letter and signature. I do not have any saved emails
in this regard but I spoke with Mr. Hull and he represented to me that
he had loaned $125,000 to LINC and I accepted his representation that
he had loaned the $125,000. As a result of a time pressure, I did not
fully investigate if the money was, in fact, loaned to LINC by Mr. Hull
but sent the letter on my belief that Mr. Hull was being truthful about
this $125,000 loan.
[48]

At paragraphs 5 and 6 of his affidavit, Mr. Chung stated:

During recent investigation by me and my employees, the Defendant
has realized that we have no evidence or proof that Mr. Anthony Hull
ever loaned monies. The Defendant has not gained the benefit of

2014 BCSC 277 (CanLII)

We would anticipate signing a forbearance letter on reasonable terms.

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Page 14

I have learned that Mr. Hull claims that his company, Hull Limited,
loaned the $125,000 which is not what he told me prior to my drafting
and sending the letter referred to in Exhibit "B" of his Affidavit.
[49]

Mr. Chung drafted the Novation Agreement some 18 months before Mr. Hull

assigned all of his interest in the loan to the plaintiff.

[50]

I find the defendants assertion, through the affidavit of Mr. Chung, that it has

no record of Mr. Hull making the loan of $125,000 to LINC to be an unsatisfactory

answer to the plaintiffs claim. For over four years, from November 2008 through
December 19, 2012, VCC repeatedly acknowledged that it was indebted, initially to
Mr. Hull, and later to Hull Limited, in the amount of $125,000.
[51]

When Mr. Chung sent the Novation Agreement to Mr. Hull on November 18,

2008, confirming that VCC had agreed to assume LINCs obligations to repay
$125,000 to Mr. Hull, he did so almost a month after he had sought and obtained
Mr. Hulls agreement to transfer his shares in LINC. The purchase of Mr. Hulls
shares formed part of the transaction by which VCC acquired LINC. While Mr.
Chung has deposed that VCCs acquisition of LINC occurred within the space of a
week, he has provided no satisfactory explanation about why he allegedly failed to
inform himself about whether Mr. Hull had made the loan to LINC before he
prepared the Novation Agreement.
[52]

Mr. Chung provides no details of the scope or nature of his recent

investigation. The defendant has provided no evidence about what inquiries, if any,
Mr. Chung made of Mr. Kriznic, Mr. Lawrenson, or Mr. Anderson regarding their
various acknowledgments of the debt. None of those individuals have sworn
affidavits controverting their admissions of the debt on behalf of VCC.
[53]

Mr. Lawrenson, the lawyer who took Mr. Chung's affidavit is also the

defendants Vice President and General Counsel who either authored, or was copied

2014 BCSC 277 (CanLII)

Mr. Hull's alleged loan that apparently occurred sometime prior to

October 2008. Mr. Hull's alleged loan that formed part of the Investor
Loans, as defined in the September 19, 2008 Letter Agreement which
is not in his affidavit, has never been accounted for financially.

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Page 15

on, four of the e-mails by which VCC acknowledged the debt. Mr. Chung now says
that the defendant cannot find any evidence that Mr. Hull ever loaned monies to
LINC, despite Mr. Lawrenson's advice of August 18, 2011 that VCC had received

reflect that assignment. Further, when Mr. Hull made inquiries of the defendant's
Chief Financial Officer respecting the debt, VCC was able to provide Mr. Hull with
information confirming the principal amount, the interest rate and the date when
payment was due.
[54]

On the whole of the evidence including:

(a)

Mr. Hulls evidence that he loaned $125,000 to LINC before

October 2008, when the defendant acquired the majority of the
shares in LINC;

(b)

the fact that VCC assumed the obligation of LINC to repay the
loan to Mr. Hull by the Novation Agreement of November 18,
2008;

(c)

the assignment by Mr. Hull of the loan to Hull Limited;

(d)

VCCs acknowledgement that it received notice of the

assignment; and

(e)

the defendants clear and unequivocal acknowledgment through

its counsel of the debt owed to Hull Limited,

I am satisfied, on the balance of probabilities, that Mr. Hull loaned $125,000 to LINC
before VCC acquired LINC.
(c)
[55]

Has VCC assumed the obligation to repay the loan and is the loan,
together with interest, now due to the plaintiff?

I have found that by the Novation Agreement of November 18, 2008, VCC

assumed LINCs obligations to repay the loan, and that Mr. Hull agreed to extend the
time for repayment of the loan to November 30, 2012 in exchange for the
defendants promise to pay interest at the rate of 8% per annum if the loan were not
repaid in full by its original due date of November 30, 2010. I have also found that
Mr. Hull made an absolute assignment of the debt to Hull Limited and that VCC
received notice in writing of that assignment. The defendant failed to repay the loan

2014 BCSC 277 (CanLII)

notice of the assignment of the loan to Hull Limited and had modified its records to

Hull Limited v. Vancouver Career College (Burnaby) Inc.

Page 16

when it came due on November 30, 2012, and has made no payment of principal or
interest in response to the plaintiffs demand for repayment of the loan. VCC is in

CONCLUSION
[56]

I have found that Mr. Hull loaned $125,000 to LINC; that VCC assumed

LINCs obligation to repay the loan; that Mr. Hull made a valid assignment of all of
his interest in the loan to the plaintiff; that Hull Limited demanded repayment of the
loan after it came due; and that VCC has failed to repay the loan, despite its multiple
acknowledgments of the debt.
[57]

The defendant is indebted to the plaintiff in the amount of $125,000 together

with accrued interest on the loan at the rate of 8% per annum from November 30,
2010 to the date of these Reasons for Judgment. On February 12, 2014, when this
application was heard, the amount of interest due was $32,054.81. Interest accrues
in the amount of $27.3973 per diem. Accordingly the amount of interest at 8% per
annum from November 30, 2010 to the date of these Reasons for Judgment is $32,
273.99.
[58]

The plaintiff will have judgment against the defendant for $125,000 plus

interest in the amount of $32,273.99 for a total of $157,273.99.

[59]

The plaintiff is entitled to the costs of this summary trial, at Scale B.

PEARLMAN J.

2014 BCSC 277 (CanLII)

breach of its obligation to repay the loan, together with interest, to the plaintiff.