Humphrey Motors Ltd. v. Ells

Humphrey Motors Ltd. v. Ells

Because the seller repossessed and resold the truck (with apparent consent) in the absence of a contractual or statutory right to recover a deficiency, the resale rescinded and terminated the conditional sale, relieving the buyer from further liability for the price; s.10 of the Conditional Sales Act does not create an implied right to claim a deficiency and the collateral promissory note was rescinded with the agreement; therefore the seller cannot recover the deficiency.

Citation
[1935] SCR 249
Parties
Plaintiff/appellant: Humphrey Motors Limited; Defendant/respondent: Joseph Ells
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
15 April 1935
Procedural Posture
Civil Appeal Concerning Conditional Sale and Recovery of Deficiency / Appeal to the Supreme Court of Canada From the Supreme Court of New Brunswick, Appeal Division
Outcome
Appeal dismissed with costs; judgment of the Supreme Court of New Brunswick, Appeal Division affirmed.
Legal Topics
Conditional Sale, Repossession, Resale, Deficiency Claim, Conditional Sales Act S.10, Rescission, Mortgage Theory
Source Language
English
Sale Contract Property Statutory Interpretation Conditional Sale Repossession Resale Deficiency Claim +3 more

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Parties

Humphrey Motors Limited

Plaintiff/appellant

Joseph Ells

Defendant/respondent

Procedural Posture

Civil Appeal Concerning Conditional Sale and Recovery of Deficiency / Appeal to the Supreme Court of Canada From the Supreme Court of New Brunswick, Appeal Division

Legal Issues

  1. 1 Whether a vendor who repossesses and resells goods may sue the buyer for any deficiency
  2. 2 Whether resale by vendor rescinds or terminates the conditional sale and relieves buyer of price obligation
  3. 3 Whether s.10 of the Conditional Sales Act creates an implied statutory right to recover a deficiency

Ratio Decidendi

Because the seller repossessed and resold the truck (with apparent consent) in the absence of a contractual or statutory right to recover a deficiency, the resale rescinded and terminated the conditional sale, relieving the buyer from further liability for the price; s.10 of the Conditional Sales Act does not create an implied right to claim a deficiency and the collateral promissory note was rescinded with the agreement; therefore the seller cannot recover the deficiency.

Court Disposition

Appeal dismissed with costs; judgment of the Supreme Court of New Brunswick, Appeal Division affirmed.

Orders

  • Appeal dismissed with costs.
  • Judgment of the Supreme Court of New Brunswick, Appeal Division affirmed.