547592 Alberta Ltd. (Receivership), Re, (1995) 171 A.R. 63 (QB)

• Judge: Bielby, J.
• Court: Court of Queen''s Bench of Alberta (Canada)
• Case Date: Monday May 01, 1995
• Citations: (1995), 171 A.R. 63 (QB)

547592 Alta. Ltd., Re (1995), 171 A.R. 63 (QB)

MLB headnote and full text

In The Matter Of The Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36, as amended

And In The Matter Of The Alberta Business Corporations Act, S.A. 1981, c. B-15, as amended

And In The Matter Of The Judicature Act, R.S.A. 1980, c. J-1, as amended

And In The Matter Of 547592 Alberta Ltd. (o/a Dollar Rent-A-Car)

(Action No. 9403-22158)

Indexed As: 547592 Alberta Ltd. (Receivership), Re

Alberta Court of Queen's Bench

Judicial District of Edmonton

Bielby, J.

May 1, 1995.

Summary:

A corporation sold automobiles to Tucker and to Deals on Wheels at or near the time the corporation was placed into receivership. The receiver manager and certain secured creditors applied for a declaration of priority over the automobiles. Ford Credit Canada Ltd., a secured creditor, applied to have a trial to determine whether a sale took place to Deals on Wheels and if so whether it was in the ordinary course of business.

The Alberta Court of Queen's Bench ordered Tucker to deliver the vehicles or their sale proceeds to the receiver manager for distribution to the secured creditors. The court allowed Ford's application for a trial.

Personal Property - Topic 6466

Security interests - Loss of title to third parties - Resale in ordinary course of business - Near the time of being put into receivership, a corporation sold automo­biles to Tucker - Delivery was not to occur unless the purchase price was not repaid - Section 30(2) of the Alberta Personal Property Security Act provided that a buyer of goods in the ordinary course of business took free of any secur­ity interests - The receiver and certain secured creditors claimed priority under s. 30(8) on the basis that the transactions were transfers as security of a money debt - The Alberta Court of Queen's Bench concluded that the receiver and secured creditors had priority where s. 30(8) excepted the transaction from the protec­tion of s. 30(2) - Alternatively, s. 30(2) was inapplicable as the sales were not in the ordinary course of business - See paragraphs 6 to 16.

Statutes Noticed:

Personal Property Security Act, S.A. 1988, c. P-4.05, sect. 30(2), sect. 30(8) [para. 4].

Counsel:

C.P. Russell, for the Receiver;

C.J. Skrobot, for 277357 Alberta Ltd. (Tucker);

R.D. Gillespie, for Deals on Wheels Ltd.;

D.G. Readman, for Ford Credit Canada Ltd.

This application was heard before Bielby, J., of the Alberta Court of Queen's Bench, Judicial District of Edmonton, who delivered the following reasons for judgment on May 1, 1995.