Alberta (Treasury Branches) v. Faja Bison Ranch Inc. et al., (1994) 152 A.R. 112 (QB)

• Judge: Dea, J.
• Court: Court of Queen''s Bench of Alberta (Canada)
• Case Date: Friday February 04, 1994
• Citations: (1994), 152 A.R. 112 (QB)

Alta. v. Faja Bison Ranch Inc. (1994), 152 A.R. 112 (QB)

MLB headnote and full text

Province of Alberta Treasury Branches (plaintiff) v. Faja Bison Ranch Inc., Bernard Smith and Celine Smith (defendants)

(Action No. 9203 11655)

Indexed As: Alberta (Treasury Branches) v. Faja Bison Ranch Inc. et al.

Alberta Court of Queen's Bench

Judicial District of Edmonton

Dea, J.

February 4, 1994.

Summary:

Proceeds from a receiver-manager's sale were directed to be paid to a third party subject to the interests of various interested parties. Buffalo Ranch B.C. Ltd. claimed as a secured creditor against the proceeds to be paid to the third party.

The Alberta Court of Queen's Bench held that the creditor's claim was unenforceable against a third party by virtue of the oper­ation of s. 10(1)(b) of the Personal Property Security Act.

Personal Property - Topic 6530

Security interests - Remedies of secured party - Claims against third parties - A secured creditor claimed against proceeds to be paid to a third party - Section 10 of the Personal Property Security Act required the creditor have possession of the collateral or a signed security agree­ment - The creditor argued constructive possession as a result of its consignment agreement and that an unsigned draft consignment together with certain corre­spondence met the require­ment of a signed security agreement - The Alberta Court of Queen's Bench held that the terms of the consignment agreement did not give the creditor constructive pos­session - The court further held that the unsigned secur­ity agreement together with the documents presented could not be con­sidered a signed security agreement and therefore could not be enforced against a third party.

Statutes Noticed:

Personal Property Security Act, S.A. 1988, c. P-4.05, sect. 10(1)(a), sect. 10(1)(b) [para. 11].

Authors and Works Noticed:

Cuming and Wood, Alberta Personal Property Security Handbook (2nd Ed.), p. 108 [para. 16].

Counsel:

Douglas R. Stollery, for the receiver-man­ager;

Frank H. Monaghan, for Buffalo Ranch B.C. Ltd.

This matter was heard before Dea, J., of the Alberta Court of Queen's Bench, Judi­cial District of Edmonton, who delivered the following judgment on Febru­ary 4, 1994.