British Columbia v. PT Car and Yacht Rental Inc.

British Columbia v. PT Car and Yacht Rental Inc.

Resplendent holds a PMSI in the vessel and SSTA s.103(6)(b) does not require perfection of a PMSI to defeat the Crown's super‑priority; the SSTA constitutes a comprehensive code granting the Crown limited priority and the legislature's silence on perfection indicates no perfection requirement for the SSTA exception. Therefore Resplendent's PMSI has priority over the Crown's tax lien; Active Bailiff Services Ltd. is entitled to full indemnity costs as there was no negligence.

Citation
2003 BCSC 1073
Parties
Judgment Creditor (crown): Her Majesty the Queen in Right of the Province of British Columbia; Judgment Debtor: PT Car and Yacht Rental Inc.; Secured Creditor (pmsi Holder): Resplendent Resources Inc.; Bailiff / Third Party: Active Bailiff Services Ltd.
Court
Supreme Court of British Columbia
Jurisdiction
Canada
Judgment Date
8 July 2003
Procedural Posture
Priority Dispute: Crown Tax Lien V. Secured Creditor (pmsi) / In Chambers – Reasons for Judgment (application)
Outcome
Declared that Resplendent Resources Inc.'s purchase money security interest has priority over the Crown's registered tax lien under the Social Services Tax Act; Crown's claim to super‑priority dismissed; Active Bailiff Services Ltd. awarded full indemnity costs.
Legal Topics
Crown Tax Lien Super‑priority, Purchase Money Security Interest, Perfection and Registration, Interpretation of SSTA S.103, Costs – Indemnity for Bailiff
Source Language
English
Tax Law Secured Transactions Priority Disputes Civil Procedure Crown Tax Lien Super‑priority Purchase Money Security Interest Perfection and Registration Interpretation of SSTA S.103 +1 more

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Parties

Her Majesty the Queen in Right of the Province of British Columbia

Judgment Creditor (crown)

PT Car and Yacht Rental Inc.

Judgment Debtor

Resplendent Resources Inc.

Secured Creditor (pmsi Holder)

Active Bailiff Services Ltd.

Bailiff / Third Party

Procedural Posture

Priority Dispute: Crown Tax Lien V. Secured Creditor (pmsi) / In Chambers – Reasons for Judgment (application)

Legal Issues

  1. 1 Whether Crown's tax lien under SSTA s.103 has priority over Resplendent's PMSI
  2. 2 Whether a PMSI must be perfected to defeat the Crown's super‑priority under SSTA s.103(5)–(6)
  3. 3 Whether the Crown properly registered its lien under SSTA s.103(2)(b)(iii)

Ratio Decidendi

Resplendent holds a PMSI in the vessel and SSTA s.103(6)(b) does not require perfection of a PMSI to defeat the Crown's super‑priority; the SSTA constitutes a comprehensive code granting the Crown limited priority and the legislature's silence on perfection indicates no perfection requirement for the SSTA exception. Therefore Resplendent's PMSI has priority over the Crown's tax lien; Active Bailiff Services Ltd. is entitled to full indemnity costs as there was no negligence.

Court Disposition

Declared that Resplendent Resources Inc.'s purchase money security interest has priority over the Crown's registered tax lien under the Social Services Tax Act; Crown's claim to super‑priority dismissed; Active Bailiff Services Ltd. awarded full indemnity costs.

Orders

  • Resplendent Resources Inc.'s PMSI in the 1995 Wellcraft Excalibur vessel has priority over the Crown's tax lien under SSTA s.103
  • The Crown's claim to priority for unpaid social services tax is dismissed to the extent it conflicts with Resplendent's PMSI