Sovereign Bank of Canada v. McIntyre

Sovereign Bank of Canada v. McIntyre

Majority held defendant, as maker of the note who alleged want of consideration, bore the onus to prove that the shares were not lawfully available for sale to him under s.34(2) and that he did not receive the stock; he failed to discharge that onus. The bank's documentary evidence, register entries, certificate, correspondence and dividends sufficiently supported a bona fide sale and consideration for the note; the admission that there was no minute allotting the ten shares specifically did not establish lack of authority under s.34(2).

Citation
(1910) 44 SCR 157
Parties
Plaintiff/appellant: Sovereign Bank of Canada; Defendant/respondent: Daniel McIntyre
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
23 December 1910
Procedural Posture
Collection / Appeal to Supreme Court of Canada From Court of Appeal for Ontario
Outcome
Appeal allowed. Judgment for appellant Sovereign Bank of Canada restored.
Legal Topics
Burden of Proof, Allotment of Shares Under Bank Act S.34(2), Consideration for Promissory Notes, Authority of Directors to Prescribe Terms of Public Subscription, Estoppel, Validity of Stock Certificates
Source Language
English
Evidence Banking Law Contract Law Securities Law Burden of Proof Allotment of Shares Under Bank Act S.34(2) Consideration for Promissory Notes Authority of Directors to Prescribe Terms of Public Subscription +2 more

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Parties

Sovereign Bank of Canada

Plaintiff/appellant

Daniel McIntyre

Defendant/respondent

Procedural Posture

Collection / Appeal to Supreme Court of Canada From Court of Appeal for Ontario

Legal Issues

  1. 1 Who bore the burden of proof to show that bank shares sold to defendant were issued without authority
  2. 2 Whether the defendant received the shares or otherwise had consideration for the promissory note
  3. 3 Whether section 34(2) of the Bank Act required a formal allotment resolution to public purchasers or only that directors prescribe manner and terms

Ratio Decidendi

Majority held defendant, as maker of the note who alleged want of consideration, bore the onus to prove that the shares were not lawfully available for sale to him under s.34(2) and that he did not receive the stock; he failed to discharge that onus. The bank's documentary evidence, register entries, certificate, correspondence and dividends sufficiently supported a bona fide sale and consideration for the note; the admission that there was no minute allotting the ten shares specifically did not establish lack of authority under s.34(2).

Court Disposition

Appeal allowed. Judgment for appellant Sovereign Bank of Canada restored.

Orders

  • Appeal allowed with costs to appellant