Ahearn & Soper v. New York Trust Co.

Ahearn & Soper v. New York Trust Co.

The deed of hypothec, as validated and ratified by the Quebec statute, created a security over the railway undertaking including the cars and movables and thus subordinated any unpaid vendors' privilege under art.2000 C.C.; additionally, when delivered and used in the tramway the cars were treated as immovables by destination, so the unpaid vendors were not entitled to priority and the appeal was dismissed.

Citation
(1909) 42 SCR 267
Parties
Appellant (opposants): Ahearn & Soper, Limited; Respondent (contestants): The New York Trust Company
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
5 October 1909
Procedural Posture
Appeal / Appeal to the Supreme Court of Canada From the Court of King's Bench, Province of Quebec; Final Judgment
Outcome
Appeal dismissed with costs; judgment of the Court of King's Bench and Superior Court affirmed.
Legal Topics
Immobilisation by Destination, Hypothecs/mortgages, Unpaid Vendor Privilege (art.2000 C.c.), Priority of Claims and Distribution of Judicial Sale Proceeds, Statutory Validation of Security (3 Edw. VII, Ch. 91)
Source Language
English
Property Law Secured Transactions Civil Procedure Immobilisation by Destination Hypothecs/mortgages Unpaid Vendor Privilege (art.2000 C.c.) Priority of Claims and Distribution of Judicial Sale Proceeds Statutory Validation of Security (3 Edw. Vii, Ch. 91)

Case Brief

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Parties

Ahearn & Soper, Limited

Appellant (opposants)

The New York Trust Company

Respondent (contestants)

Procedural Posture

Appeal / Appeal to the Supreme Court of Canada From the Court of King's Bench, Province of Quebec; Final Judgment

Legal Issues

  1. 1 Whether the tramway cars were immovable by destination at the time of sale
  2. 2 Whether unpaid vendors' privilege under art.2000 C.C. has priority over the deed of hypothec/mortgage ratified by statute
  3. 3 Whether the validating statute and hypothec deed subordinated other creditors including unpaid vendors

Ratio Decidendi

The deed of hypothec, as validated and ratified by the Quebec statute, created a security over the railway undertaking including the cars and movables and thus subordinated any unpaid vendors' privilege under art.2000 C.C.; additionally, when delivered and used in the tramway the cars were treated as immovables by destination, so the unpaid vendors were not entitled to priority and the appeal was dismissed.

Court Disposition

Appeal dismissed with costs; judgment of the Court of King's Bench and Superior Court affirmed.

Orders

  • Appeal dismissed with costs.
  • Judgment of the Court of King's Bench, appeal side, and the Superior Court confirmed.