Canadian Imperial Bank of Commerce (the bank) (plaintiff) negotiated a loan to Abel Construction Co., Ltd. (Abel). The terms of the loan agreement empowered the bank to call the loan at the bank’s discretion. As security for the loan, the bank demanded personal guarantees from Abel’s four shareholders. Three of the four shareholders provided guarantees, and the bank provided the loan. Several days later, Bernard Frishman (defendant), the shareholder who had not yet provided a guarantee, finally provided his guarantee to the bank. The bank later called the loan, and Abel filed for bankruptcy. The bank then demanded the outstanding amount of the loan from Frishman, based on his guarantee. When Frishman refused to pay, the bank sued him. The district court entered judgment in Frishman’s favor on the original amount of the loan, but entered judgment in favor of the bank for the amount of an overdraft that Abel had drawn from the bank. Both parties appealed.