Bank of Montreal v. Marleau et al., (1994) 126 Sask.R. 273 (QB)

• Judge: Goldenberg, J.
• Court: Court of Queen's Bench of Saskatchewan (Canada)
• Case Date: November 29, 1994
• Jurisdiction: Saskatchewan
• Citations: (1994), 126 Sask.R. 273 (QB)

Bk. of Mtrl. v. Marleau (1994), 126 Sask.R. 273 (QB)

MLB headnote and full text

Bank of Montreal (plaintiff) v. Real Marleau (defendant)

(1991 Q.B. No. 124)

Bank of Montreal (plaintiff) v. Real Victor Marleau, Olive Irene Marleau, Marc Real Marleau, Yvonne Adele Marleau, Lorraine Ellen Wisser and Brenda Diane Ives (defendants)

(1991 Q.B. No. 109)

Indexed As: Bank of Montreal v. Marleau et al.

Saskatchewan Court of Queen's Bench

Judicial Centre of Melfort

Goldenberg, J.

November 29, 1994.

Summary:

A bank sued on a guarantee and sought to have various transactions set aside as fraud­ulent transactions under the Fraudulent Preferences Act and the Statute of Elizabeth.

The Saskatchewan Court of Queen's Bench allowed the bank's action.

Fraud and Misrepresentation - Topic 1401

Fraudulent conveyances and preferences - Impeachable conveyances and preferences under Statute of Elizabeth (1571) - A farming company had various outstanding loans with the bank but wished to extend its line of credit - In May 1985, the bank obtained a personal guarantee from Mar­leau - In May 1988, the bank demanded payment under the guarantee - Within a month, Marleau transferred the title to various lands to his children and wife - The trans­fers were said to be for estate planning purposes and were made as gifts (no con­sideration) - Marleau was insolvent or on the eve of insolvency at the time of the transfers - The Saskatchewan Court of Queen's Bench held that the transfers could not stand under the Statute of Elizabeth or the Fraudulent Preferences Act - See paragraphs 28 to 63.

Fraud and Misrepresentation - Topic 1455

Fraudulent conveyances and preferences - Impeachable conveyances and preferences under modern statutes - Conveyance to defeat creditors - [See Fraud and Mis­representation - Topic 1401 ].

Interest - Topic 5307.1

Interest as damages (prejudgment inter­est) - Interest on payment of money or debt withheld - Amount due under a guarantee - A farming company had vari­ous out­standing loans with the bank but wished to extend its line of credit - In May 1985, the bank obtained a per­sonal guarantee from Marleau for $150,000 - In May 1988, the bank demanded pay­ment under the guarantee - Marleau un­success­fully attempted to negotiate until January 1992 - The bank sued on the guarantee - Mar­leau claimed that the interest should not begin to run until the negotiations ended and other security was liquidated - The Saskatchewan Court of Queen's Bench held that the interest accrued from the receipt of the demand for payment - Mar­leau had attempted to bar­gain and as a result he was responsible for the time that elapsed - See paragraphs 23 to 25.

Cases Noticed:

Westerlund v. Ayer, [1971] S.C.R. 131, refd to. [para. 12].

Bank of Nova Scotia v. Carpet Warehouse (Saskatoon) Ltd., Kratochvill, Evjen, Atamanenko and Atko Services Ltd. (1984), 31 Sask.R. 165 (Q.B.), refd to. [para. 15].

Co-Operative Trust Co. of Canada v. Receveur, Hansen, Paslowski and Mahon (1985), 40 Sask.R. 315 (C.A.), refd to. [para. 15].

Crown Manufacturers Ltd. v. Texas Refinery Corp. of Canada Ltd. (1984), 31 Sask.R. 266 (Q.B.), refd to. [para. 15].

Merchants Consolidated Ltd. v. George and Dufour (1981), 15 Sask.R. 372 (Q.B.), refd to. [para. 15].

Bank of Nova Scotia v. Nemanishen et al. (1990), 87 Sask.R. 73 (Q.B.), refd to. [para. 15].

Canadian Imperial Bank of Commerce v. Kanadian Kiddee Photo Ltd., [1979] 3 W.W.R. 256 (B.C.S.C.), refd to. [para. 15].

Royal Bank of Canada v. Fazakas et al. (1994), 118 Sask.R. 120 (Q.B.), refd to. [para. 15].

Bauer v. Bank of Montreal, [1980] 2 S.C.R. 102; 32 N.R. 191, refd to. [para. 22].

Roynat Ltd. v. Denis et al., [1982] 5 W.W.R. 509; 17 Sask.R. 415 (C.A.), refd to. [para. 22].

Co-Operative Trust Co. of Canada v. Kirkby and Thorpe, [1986] 6 W.W.R. 90; 51 Sask.R. 298 (Q.B.), refd to. [para. 27].

Kozan Furniture (Yorkton) Ltd. Estate v. Countrywide Factors Ltd. (1977), 14 N.R. 91; 72 D.L.R.(3d) 500 (S.C.C.), refd to. [para. 51].

Robinson v. Countrywide Factors Ltd. - see Kozan Furniture (Yorkton) Ltd. Estate v. Countrywide Factors Ltd.

Evans (Bankrupt), Re (1993), 134 A.R. 149; 5 Alta. L.R.(3d) 243 (Q.B.), refd to. [para. 51].

Alberta (Director of Employment Stan­dards) v. Sanche - see Evans (Bankrupt), Re.

PWA Corp. v. Gemini Group Automated Distribution Systems Inc. et al. (1993), 101 D.L.R.(4th) 15 (Gen. Div.), affd. (1993), 64 O.A.C. 274; 15 O.R.(3d) 730 (C.A.), leave to appeal refused (1993), 163 N.R. 158; 68 O.A.C. 21 (S.C.C.), refd to. [para. 52].

Goodwin v. Williams (1856), 5 Gr. 539, refd to. [para. 53].

Monteith et al. v. Hayden et al. (1987), 81 N.B.R.(2d) 273; 205 A.P.R. 273; 42 D.L.R.(4th) 721 (C.A.), refd to. [para. 53].

Dondee Stock Farms Ltd. (Bankrupt), Re (1993), 117 Sask.R. 1 (Q.B. Bktcy.), refd to. [para. 55].

Bank of Montreal v. Vandine, [1953] 1 D.L.R. 456 (N.B.C.A.), refd to. [para. 56].

Bank of Nova Scotia v. MacDonald and MacDonald (1982), 39 N.B.R.(2d) 71; 103 A.P.R. 71 (T.D.), refd to. [para. 56].

Oliver v. McLaughlin (1893), 24 O.R. 41 (C.A.), refd to. [para. 57].

Commerce Capital Mortgage Corp. v. Jemmet (1981), 37 C.B.R.(N.S.) 59 (Ont. H.C.), refd to. [para. 57].

B & N Flooring Supplies Ltd. v. Williams and Williams (1980), 34 N.B.R.(2d) 582; 85 A.P.R. 582 (T.D.), refd to. [para. 57].

National Bank of Canada v. Kerrigan (1991), 44 C.L.R. 11 (N.B.T.D.), refd to. [para. 59].

Goertz (Bankrupt) v. Goertz et al., [1994] 8 W.W.R. 250; 122 Sask.R. 93 (Q.B.), refd to. [para. 65].

Statutes Noticed:

Fraudulent Preferences Act, R.S.S. 1978, c. F-21, sect. 3 [para. 49].

Queen's Bench Act, R.S.S. 1978, c. Q-1, sect. 45(18) [para. 20].

Statute of Elizabeth (1571)(Imp.), 13 Eliz. c. 5, generally [para. 1].

Counsel:

R.M. Van Beselaere, for the plaintiff;

G. Carson, for Real Victor Marleau and Olive Irene Marleau;

W.A. Selnes, for Marc Real Marleau, Yvonne Adele Marleau, Lorraine Ellen Wisser and Brenda Diane Ives.

This case was heard by Goldenberg, J., of the Saskatchewan Court of Queen's Bench, Judicial Centre of Melfort, who delivered the following decision on November 29, 1994.