Union Bank of Halifax v. Indian & General Investment Trust

Union Bank of Halifax v. Indian & General Investment Trust

The bank failed to prove it acquired the goods as a purchaser for value without notice of the trust deed's restrictive clause; the trustee's floating charge therefore had priority over the bank's security and the bank's appeal must be dismissed with costs.

Citation
(1908) 40 SCR 510
Parties
Appellant/defendant: Union Bank of Halifax; Respondent/plaintiff: The Indian and General Investment Trust; Defendant/company: Acadia Pulp & Paper Mills Company, Limited; Defendant/receiver: Walter G. Jones, receiver and manager
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
6 October 1908
Procedural Posture
Appeal / Final Hearing at the Supreme Court of Canada on Appeal From Supreme Court of Nova Scotia
Outcome
Appeal dismissed with costs.
Legal Topics
Floating Charge, Purchase for Value Without Notice, Priority of Securities, Notice, Bank Act Security
Source Language
English
Equity Property Companies Law Banking Law Secured Transactions Floating Charge Purchase for Value Without Notice Priority of Securities +2 more

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Parties

Union Bank of Halifax

Appellant/defendant

The Indian and General Investment Trust

Respondent/plaintiff

Acadia Pulp & Paper Mills Company, Limited

Defendant/company

Walter G. Jones, receiver and manager

Defendant/receiver

Procedural Posture

Appeal / Final Hearing at the Supreme Court of Canada on Appeal From Supreme Court of Nova Scotia

Legal Issues

  1. 1 Whether a special security given to the bank took priority over an earlier floating charge created by a trust deed
  2. 2 Who bears the onus of proof on the plea of purchase for value without notice
  3. 3 Whether the bank had actual notice of the restrictive clause in the trust deed (including by telephone conversation)

Ratio Decidendi

The bank failed to prove it acquired the goods as a purchaser for value without notice of the trust deed's restrictive clause; the trustee's floating charge therefore had priority over the bank's security and the bank's appeal must be dismissed with costs.

Court Disposition

Appeal dismissed with costs.

Orders

  • Appeal dismissed with costs.
  • Receiver to pay the fund (realized from pulp wood) to The Indian and General Investment Trust (trustee) in accordance with the decision below.