Context: Thornridge Holdings loaned money to several key employees to purchase shares in Envirosystems, a company it sold in 2015. The loans were secured by promissory notes.
Issue: Thornridge demanded repayment in 2021, leading to disputes over the validity of an "Appointment of Agent Agreement" (Agency Agreement) used to settle the debts.
Key Points:
Promissory Notes: Loans totaling $2,154,888 were given to the defendants, with individual amounts specified.
Agency Agreement: Signed by Thornridge's then-president Nicholas Betts, it appointed Michael Ryan and Michael Tringali as agents to manage the employee loans. Its validity is disputed.
Dispute: Thornridge claimed the agreement was unauthorized, void, and conflicted with corporate governance rules.
Legal Issues:
Authority and Knowledge:
Section 30 of the Companies Act: Generally prevents a company from denying the authority of its agents. However, exceptions apply if the involved parties had knowledge of the lack of authority.
Key Question: Whether Ryan and others knew the agreement required two signatures as per company policy.
Material Facts and Genuine Issues:
Knowledge: Ryan's knowledge of the need for dual signatures and the subsequent actions of the defendants upon receiving the demand letters are central to the case.
Settlement Agreements: Defendants settled their debts based on the disputed Agency Agreement, leading to questions of unjust enrichment and breach of contract.
Court's Decision:
Summary Judgment Motion: Denied due to the existence of genuine issues of material fact regarding the knowledge and authority related to the Agency Agreement.
Next Steps: A hearing will be scheduled to further address the unresolved issues.
