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(a) Grabbe and Gouge Bank (Plaintiff)  v.  Peter Holden ("Defendant")


Facts: Peter Holden has a company, PJH Enterprises Ltd., and at the time of incorporation, the company obtained a bank loan for $50,000.00. As collateral for the loan to the company, Peter signed a personal guarantee. After a number of years of operation, his company is in financial difficulties. The company still owes the Grabbe & Gouge Bank $38,000.00 and the loan payments are overdue. The bank sues on the guarantee.   The guarantee should have been signed as follows:




                                                 Peter J. Holden                      (seal)            

                                                       Peter J. Holden



       However, the bank forgot to put the seal on so that the signature line looks like this:



                                                 Peter J. Holden                              (seal)   

                                                 Peter J. Holden



The lawyer for the bank claims that because Peter Holden intended to provide the guarantee and because the document clearly shows that it was intended to be signed under seal, to prevent an injustice, it should be enforced by the court. The lawyer for the Bank cited the Royal Bank v. Kiska, a decision of the Ontario Court of Appeal in support of its claim and said that the BC court could follow it because it was a higher court and from a Common Law jurisdiction.


 

Judgment (1 mark):

 

 

Reasons for Judgment (2 mark): 

  

 

Step-by-step answer

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Subject: Law, Social Science

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