Anna and Archie Andrews were long-time residents of

Anna and Archie Andrews were long-time residents of Springwater, Ontario. Archie was a carpenter. In Springwater, there is a hardware store called Diego’s Hardware (“Diego’s”), named after its owner, Diego D’Ambrosio. Archie was a long-time client of Diego’s and regularly purchased carpentry supplies on running credit. Archie was diligent about paying his accounts at the end of each month.

Anna and Archie had two children: Roger and Betty Andrews. Betty lives in Newmarket, Ontario, where she works as a realtor. Roger lives in Winnipeg, Manitoba, and works as a rigger.

Anna Andrews passed away in November 2021. Archie passed away in January 2022. Archie left the family home jointly to Betty and Roger. They decided to renovate the house before putting it on the market. After renovations, the house is expected to be worth $750,000. The sale proceeds would be used to pay off the mortgage balance of $500,000. Once the house is sold, and the estate expenses were paid, Betty and Roger will each inherit approximately $100,000.

On January 15th, 2022, Roger went to Diego’s Hardware and introduced himself as Archie’s son. He explained to Rick Ricardo, the manager, that he wanted to purchase supplies on credit and that he would pay the account upon the closing of the sale of the house or by April 20, 2022, whichever came earlier. Roger and Rick agreed that the account would not be allowed to exceed a $60,000 credit and that interest would begin to accrue one month (“net 30”) after each account debit at an annual interest rate of 8%. The was no written contract. Rick took notes, but no formal written contract.

Rick approved the retail credit as Roger requested. Rick did not request a credit bureau search consent, but did obtain Roger’s personal information, from his driver’s license, as follows:

Roger Andrews,
Born: April 12, 1981, 1228 Elmwood Drive Winnipeg, Manitoba R3G 1K7
(204) 555-1235
(705) 555-1632 (local)

Roger’s running account at Ricardo’s is as follows:

DATE Jan 15

Jan 21 Feb 23 Feb 28 Mar 6 April 17

INVOICE DEBIT 20-147 15,000

20-158 30,000 20-181 4,100 20-193 9,200

CREDIT 15,000

5,000

BALANCE $15,000

0 $30,000 $34,100 $43,300

Betty and Roger completed the renovations on their parents’ home on March 25, 2022, and put the house up for sale at $750,000. They found a buyer on March 29, 2022, and the sale closed on April 20, 2022, for $765,000.

On April 21st, 2022, Rick called the local telephone number Roger had provided and Betty answered the phone. Rick asked to speak to Roger to inquire about the payment that was now overdue. Betty informed Rick that the sale of the house had closed and she thought that Roger had already paid the account from the proceeds of the sale.

Betty told Rick that Roger had returned to Winnipeg on April 17th and had recently left for a one-week vacation at an all-inclusive resort in Mexico with his wife, Deborah. Betty also mentioned that she didn’t know how they could afford the vacation as her brother was “deeply in debt”.

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On April 30th, 2022, Rick reluctantly decided to call a lawyer to see what the options were to collect the debt that Roger owed. The lawyer, Max Power, obtained some preliminary searches and determined that:

• – Roger has a new vehicle and a new home in Manitoba, both of which are collateral in a registered security agreement and mortgage, respectively.

• – Roger also has a few unencumbered assets in Alberta, collectively worth approximately $50,000.

• – Although Roger makes a decent living, he consistently has financial difficulty during his layoff seasons.

  You are Max Power’s law clerk and have been asked to assist him in handling this file. Specifically, you have been asked to do the following:

  DELIVERABLE 1.1 – (due Feb 7, 2022)

  1. -Outlinethestepsyouneedtotakeinopening/preparingthefileforMax(assume that Rick has already executed a retainer agreement and provided a $5,000 cheque for his initial retainer). 

  2. -How much can the client claim for the unpaid account, including the principal and all applicable interest as of April 17, 2022? 

  3. -The client has instructed Max to send a demand letter to the debtor, dated May 2, 2022, with a 10 day demand period. You have been instructed to demand the amount due on the date of anticipated payment. Prepare same for Max’s review.