Rustin v. The Fairchild Co.

Rustin v. The Fairchild Co.

The lien and mortgage clause only became operative upon complete delivery of the machinery as required by the contract; 'or upon demand' must be read to mean a demand made after such delivery, therefore the alleged lien never existed and cannot be enforced.

Citation
(1907) 39 SCR 274
Parties
Appellant/defendant: William Rustin; Respondent/plaintiff: The Fairchild Company
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
24 June 1907
Procedural Posture
Contract / Appeal to the Supreme Court of Canada From the Court of King's Bench for Manitoba
Outcome
Appeal allowed; judgment below reversed; action dismissed with costs; alleged lien declared never to have existed; other rights of respondents reserved.
Legal Topics
Sale of Goods, Sale of Machinery, Lien and Charge, Mortgage, Delivery, Contract Interpretation
Source Language
English
Contract Property Security/lien Sale of Goods Sale of Machinery Lien and Charge Mortgage Delivery +1 more

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Parties

William Rustin

Appellant/defendant

The Fairchild Company

Respondent/plaintiff

Procedural Posture

Contract / Appeal to the Supreme Court of Canada From the Court of King's Bench for Manitoba

Legal Issues

  1. 1 Whether the vendor had an enforceable lien or charge on the purchaser's land under the contract despite incomplete delivery of the machinery
  2. 2 Whether the phrase 'or upon demand' in the mortgage/lien clause allowed demand at execution or only after complete delivery
  3. 3 Whether the instruments taken were enforceable promissory notes given the contractual context

Ratio Decidendi

The lien and mortgage clause only became operative upon complete delivery of the machinery as required by the contract; 'or upon demand' must be read to mean a demand made after such delivery, therefore the alleged lien never existed and cannot be enforced.

Court Disposition

Appeal allowed; judgment below reversed; action dismissed with costs; alleged lien declared never to have existed; other rights of respondents reserved.

Orders

  • Appeal allowed with costs
  • Action dismissed with costs, including costs of appeal in the court below