Facts: The respondents, who were due funds, entered into a settlement agreement with the appellants who claimed to have limited funds to satisfy the debt. When additional information came to light in respect of the appellant’s finances, the respondents sought to set aside the agreement. Siding in favour of the respondents, the application judge found that that the respondents were induced to enter into the settlement agreement by the appellants’ intentional misrepresentations concerning their ability to pay the outstanding amounts and, further, that the respondents relied on those misrepresentations, to their detriment.

The appellants appealed, arguing that the application judge erred by (1) making key factual findings that were not supported by the evidentiary record, (2) failing to convert the application into a trial of the issues, and (3) by failing to provide any or sufficient reasons for his ruling.

Held: The Court rejected the appellants’ arguments. First, there was ample evidence before the application judge to support the finding that the settlement agreement was entered into on the basis of material misrepresentations. At the time the settlement offer was made the respondents did not know that a sale of the appellants’ real property, against which the respondents had registered executions, was scheduled to close within days. They further did not know that the anticipated proceeds of sale were sufficient to pay the monies owed.

Second, at no time did the appellants seek an order from the application judge for the trial of an issue. Nor, in light of the written record before the application judge, was a trial required. The appellants essentially acknowledged as much in their cross-application when they sought, as primary relief, a declaration that an enforceable settlement agreement had been entered into by the parties and orders compelling its enforcement. Third, the application judge provided oral reasons for the core of his decision and supplemented those reasons with a short written endorsement.

Elka Dadmand