Liska v. Bank of British Columbia, (1981) 27 A.R. 614 (QB)

• Judge: Kirby, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: March 11, 1981
• Citations: (1981), 27 A.R. 614 (QB)

Liska v. Bk. of B.C. (1981), 27 A.R. 614 (QB)

MLB headnote and full text

Liska v. Bank of British Columbia

(Q.B. 147397)

Indexed As: Liska v. Bank of British Columbia

Alberta Court of Queen's Bench

Judicial District of Calgary

Kirby, J.

March 11, 1981.

Summary:

This case arose out of the plaintiff's claim against the defendant bank for damages for the loss of three emeralds, which the plaintiff hypothecated to the bank as collateral for a loan. The bank counterclaimed for the balance payable on the note. The Alberta Court of Queen's Bench allowed both the plaintiff's action and the defendant's counterclaim.

Bailment - Topic 2303

Liability of bailee - Damages - Measure of damages - In an action for damages for the loss of three emeralds hypothecated as security for a loan the Alberta Court of Queen's Bench applied the principle that the governing purpose of damages is to put the party whose rights have been violated in the same position, so far as money can do so, as if his rights had been observed - The court held that the measure of damages was the replacement value of the emeralds - See paragraphs 22 to 24.

Bailment - Topic 9421

Pledges - Duty of pledgee - General - The Alberta Court of Queen's Bench held that a bank which accepts the hypothecation of emeralds as collateral for a loan has a duty to use reasonable care and diligence to preserve the collateral - The court held the bank liable for loss of the emeralds - See paragraphs 1 to 21.

Damages - Topic 558

Limitations of compensatory damages - Remoteness - Contracts - Damages within reasonable contemplation of parties - The plaintiff emerald dealer hypothecated three emeralds with a bank as security for a loan - The bank lost the emeralds, which handicapped the plaintiff financially and damaged his credibility with suppliers with resulting loss of anticipated profit - The Alberta Court of Queen's Bench held that the plaintiff was limited to damages for the replacement value of the emeralds, because the consequential losses were not within the contemplation of the parties at the time of the hypothecation - See paragraph 23.

Negotiable Instruments - Topic 8003

Promissory notes - Presentment for payment - When unnecessary - Bills of Exchange Act, R.S.C. 1970, c. B-5, s. 183 - The Alberta Court of Queen's Bench held that an action could be brought on a demand note payable at a certain place without presentment for payment - See paragraphs 28 to 32.

Negotiable Instruments - Topic 8307

Promissory notes - Payment - Requirement of demand for payment - Demand note - The Alberta Court of Queen's Bench held that an action could be brought on a demand note without a demand for payment - See paragraphs 25 to 27.

Cases Noticed:

Coggs v. Bernard (1703), 92 E.R. 107, appld. [para. 15].

Hochelaga Bank v. Larue (1910), 13 W.L.R. 114; 3 Alta. L.R. 42 (C.A.), appld. [para. 19].

Royal Bank v. Talbot, [1928] 3 D.L.R. 157 (Alta. C.A.), appld. [para. 20].

Wertheim v. Chicoutimi Pulp Company, [1911] A.C. 301 (P.C.), appld. [para. 22].

Koufof v. Czarnikow, [1969] 1 A.C. 340; [1967] 3 All E.R. 686, appld. [para. 23].

Asamera Oil Corp. v. Baud Corp., 23 N.R. 181; [1978] 6 W.W.R. 301 (S.C.C.), appld. [para. 23].

Royal Bank v. Dwigans, [1933] 1 W.W.R. 672; [1933] 3 D.L.R. 178, appld. [para. 27].

Bank of Montreal v. Kon et al., [1978] 2 W.W.R. 503, appld. [para. 30].

Hayden, Clinton Nat. Bank v. Dixon (1916), 9 Alta. L.R. 303; 9 W.W.R. 1269; 26 D.L.R. 694, appld. [para. 30].

Statutes Noticed:

Bills of Exchange Act, R.S.C. 1970, c. B-5, sect. 183 [para. 28].

Authors and Works Noticed:

American and English Encyclopedia of Law (2nd Ed.), vol. 22, p. 899 [para. 19].

Halsbury's Laws of England (3rd Ed.), vol. 2, p. 117 [para. 18].

Palmer on Bailment (1979), pp. 50 [para. 14]; 89 [para. 16].

Shorter Oxford English Dictionary [para. 14].

Counsel:

A.W. MacDonald, for the plaintiff;

F.W.T. Somerville, for the defendant.