Robinson, Little & Co. v. Scott & Son

Robinson, Little & Co. v. Scott & Son

The deposit of the cheque to the debtor's account with his private banker and the subsequent application of those funds to an overdue note constituted a payment to a creditor within the meaning of R.S.O. (1897) ch.147 s.3(1); given the absence of knowledge of insolvency, lack of sinister intention, and credible evidence that the debtor believed himself solvent, the transaction was not void as against creditors.

Citation
(1907) 39 SCR 281
Parties
Plaintiff/appellant: Robinson, Little & Co.; Defendant: M. McGillivray; Defendant/respondent: J.W. Scott & Son
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
24 June 1907
Procedural Posture
Bankruptcy and Insolvency Appeal / On Appeal to the Supreme Court of Canada From the Court of Appeal for Ontario
Outcome
Appeal dismissed with costs.
Legal Topics
Preferential Transfer, Payment to Creditor, Insolvency, Cheque Deposit, Private Banker, R.s.o. (1897) Ch. 147 S. 3(1)
Source Language
English
Bankruptcy and Insolvency Preferential Transfer Payment to Creditor Insolvency Cheque Deposit Private Banker R.s.o. (1897) Ch. 147 S. 3(1)

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Parties

Robinson, Little & Co.

Plaintiff/appellant

M. McGillivray

Defendant

J.W. Scott & Son

Defendant/respondent

Procedural Posture

Bankruptcy and Insolvency Appeal / On Appeal to the Supreme Court of Canada From the Court of Appeal for Ontario

Legal Issues

  1. 1 Whether deposit of a cheque to a private banker to cover an overdue note constitutes a preferential transfer within R.S.O. (1897) ch.147 s.3(1)
  2. 2 Whether the transaction amounted to a payment to a creditor and therefore is not void as against other creditors
  3. 3 Whether there was knowledge of insolvency or sinister intention by the debtor or creditor

Ratio Decidendi

The deposit of the cheque to the debtor's account with his private banker and the subsequent application of those funds to an overdue note constituted a payment to a creditor within the meaning of R.S.O. (1897) ch.147 s.3(1); given the absence of knowledge of insolvency, lack of sinister intention, and credible evidence that the debtor believed himself solvent, the transaction was not void as against creditors.

Court Disposition

Appeal dismissed with costs.

Orders

  • Appeal dismissed
  • Costs awarded to respondents