Canadian Laboratory Supplies v. Engelhard Industries

Canadian Laboratory Supplies v. Engelhard Industries

Canlab acquired title on delivery under ordinary purchase orders; Engelhard is liable in conversion for platinum retained that had been stolen and resold by Canlab’s employee for the period before Canlab was put on inquiry; Canlab was put on inquiry on October 11, 1966, and recovery is limited to transactions before that date; apparent/ostensible authority did not estop Canlab prior to that date because representations relied upon lacked backing by persons with actual authority to manage the relevant part of Canlab’s business.

Citation
[1979] 2 SCR 787
Parties
Appellant/plaintiff: Canadian Laboratory Supplies Ltd.; Respondent/defendant: Engelhard Industries of Canada Ltd.
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
8 May 1979
Procedural Posture
Civil Appeal (conversion/agency Torts) / Supreme Court of Canada on Appeal From the Court of Appeal for Ontario
Outcome
Appeal allowed in part; Court of Appeal judgment set aside; trial judge’s finding of defendant liability restored but damages limited to pre‑inquiry period.
Legal Topics
Ostensible Authority, Ratification, Conversion, Title to Goods, Damages, Inquiry/notice, Apparent Authority
Source Language
English
Agency Torts Sale of Goods Estoppel Property (conversion) Ostensible Authority Ratification Conversion +4 more

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Parties

Canadian Laboratory Supplies Ltd.

Appellant/plaintiff

Engelhard Industries of Canada Ltd.

Respondent/defendant

Procedural Posture

Civil Appeal (conversion/agency Torts) / Supreme Court of Canada on Appeal From the Court of Appeal for Ontario

Legal Issues

  1. 1 Whether title to platinum passed to Canlab despite theft by its employee
  2. 2 Whether Canlab was estopped from denying Cook’s authority under ostensible/apparent authority or ratification
  3. 3 Whether Engelhard is liable in conversion for platinum resold by the thief prior to Canlab being put on inquiry

Ratio Decidendi

Canlab acquired title on delivery under ordinary purchase orders; Engelhard is liable in conversion for platinum retained that had been stolen and resold by Canlab’s employee for the period before Canlab was put on inquiry; Canlab was put on inquiry on October 11, 1966, and recovery is limited to transactions before that date; apparent/ostensible authority did not estop Canlab prior to that date because representations relied upon lacked backing by persons with actual authority to manage the relevant part of Canlab’s business.

Court Disposition

Appeal allowed in part; Court of Appeal judgment set aside; trial judge’s finding of defendant liability restored but damages limited to pre‑inquiry period.

Orders

  • Appeal allowed with costs
  • Judgment of Court of Appeal for respondent set aside