Doran (Bankrupt), Re, (2006) 243 N.S.R.(2d) 139 (SC Reg.)

• Court: Supreme Court of Nova Scotia (Canada)
• Case Date: November 29, 2005
• Jurisdiction: Nova Scotia
• Citations: (2006), 243 N.S.R.(2d) 139 (SC Reg.);2006 NSSC 123

Doran (Bankrupt), Re (2006), 243 N.S.R.(2d) 139 (SC Reg.);

    772 A.P.R. 139

MLB headnote and full text

Temp. Cite: [2006] N.S.R.(2d) TBEd. AP.048

In The Matter Of the Bankruptcy of Kevin Raymond Doran and Constance Louise Doran

(B 28743; 2006 NSSC 123)

Indexed As: Doran (Bankrupt), Re

Nova Scotia Supreme Court

In Bankruptcy and Insolvency

Cregan, Registrar

April 18, 2006.

Summary:

The bankrupt leased furniture from Easyhome prior to his assignment in bankruptcy. Easyhome filed a proof of claim, seeking the return of the furniture. The trustee disallowed the claim. Easyhome appealed.

A Registrar of the Nova Scotia Supreme Court, In Bankruptcy and Insolvency, dismissed the appeal.

Bankruptcy - Topic 431

Property of bankrupt - Property leased by bankrupt - The bankrupt leased furniture from Easyhome prior to his assignment in bankruptcy - Easyhome filed a proof of claim, seeking the return of the furniture - The trustee disallowed the claim because the lease in substance created a security interest in the furniture - Easyhome appealed - A Registrar of the Nova Scotia Supreme Court, In Bankruptcy and Insolvency, dismissed the appeal and confirmed the disallowance - The rental agreement was made a security lease subject to the Personal Property Security Act by providing the automatic passing of title upon paying rent over 156 weeks - Accordingly, the trustee had priority over Easyhome - See paragraphs 6 to 14.

Bankruptcy - Topic 431

Property of bankrupt - Property leased by bankrupt - The bankrupt leased furniture from Easyhome prior to his assignment in bankruptcy - Easyhome filed a proof of claim, seeking the return of the furniture - The trustee disallowed the claim because the lease by its terms was a lease for a term of more than one year - Easyhome appealed - A Registrar of the Nova Scotia Supreme Court, In Bankruptcy and Insolvency, dismissed the appeal and confirmed the disallowance - The rental agreement was for an initial term of one week - It was renewable for 155 terms of one week each at the option of the bankrupt, a total term exceeding one year - Accordingly, the lease was governed by the Personal Property Security Act and the trustee had priority over Easyhome - See paragraphs 15 to 17.

Bankruptcy - Topic 483

Property of bankrupt - Exemptions or exclusions - Property exempt from seizure under provincial laws - The bankrupt leased furniture from Easyhome prior to his assignment in bankruptcy - Easyhome filed a proof of claim, seeking the return of the furniture - The trustee disallowed the claim - Easyhome appealed - A Registrar of the Nova Scotia Supreme Court, In Bankruptcy and Insolvency, dismissed the appeal and confirmed the disallowance - The Registrar held that the furniture was not exempt from seizure under s. 59(3) of the Personal Property Security Act because the security interest was in a lease for a term of more than one year - There was no exemption under s. 45 of the Judicature Act because the bankrupt did not own the furniture - See paragraphs 19 to 28.

Cases Noticed:

Giffen (Bankrupt), Re, [1998] 1 S.C.R. 91; 222 N.R. 29; 101 B.C.A.C. 161; 164 W.A.C. 161, refd to. [para. 18].

VW Credit Canada Inc. v. Roberts (Bankrupt) (2001), 192 N.S.R.(2d) 79; 599 A.P.R. 79; 197 D.L.R.(4th) 274 (C.A.), refd to. [para. 21].

Statutes Noticed:

Personal Property Security Act, S.N.S. 1995-96, c. 13, sect. 4(1) [para. 11]; sect. 4(2) [para. 15]; sect. 21(2) [para. 7].

Authors and Works Noticed:

Cuming, Ronald C.C., Wood, Roderick J., and Walsh, Catherine, Personal Property Security Law (2005), pp. 70, 71 [para. 12].

Counsel:

Michael J.E. Verner, for the trustee, Venner & Associates Inc.;

Paul Daley, for Easyhome.

This appeal was heard on November 29, 2005, by Cregan, Registrar, of the Nova Scotia Supreme Court, In Bankruptcy and Insolvency, who delivered the following decision on April 18, 2006.