Key Facts:

• Lease and Franchise Agreements: 2562583 Ontario Inc. (Franchisee, operating under Meltwich Food Co.) took over a lease for premises in Oshawa and operated a Meltwich restaurant under a franchise agreement with Meltwich Hospitality Group Inc. (Franchisor). Jeyaparan guaranteed both agreements.
• Default: The Franchisee defaulted on the lease, leading to its termination in 2018 due to unpaid rent of $15,357.44 and subsequent delinquencies.
• Landlord’s Lawsuit: TRitson Division Retail GP Limited (Landlord) sued for breach of the lease and sought $208,932.62 in damages, including future lost rent.

Crossclaim and Settlement:

• The Franchisor settled with the Landlord for $175,000 and sought indemnity from the Franchisee for that amount and legal fees ($21,533.64).
• Franchisee’s Defenses:
  • Claimed sabotage by the previous franchisee and inadequate franchisor support.
  • Asserted not receiving the full lease terms.
  • None of these defenses were supported by evidence.

Court Decision:

• The Franchisor’s motion for summary judgment was granted. The Franchisee and Jeyaparan were held liable for:
  • $196,533.64 in damages, including the settlement and legal fees.
  • Additional $2,000 for costs of the motion.
• Total liability: $198,533.64 plus interest.