Paquette (Bankrupt), Re, (1994) 152 A.R. 286 (QB)

• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: February 22, 1994
• Citations: (1994), 152 A.R. 286 (QB)

Paquette (Bankrupt), Re (1994), 152 A.R. 286 (QB)

MLB headnote and full text

In the Matter of the Bankruptcy of Joseph Omer Gaetan Paquette of Edmonton, Alberta;

And in the Matter of the Claim of the Edmonton Civic Employees Credit Union Ltd.

(Action No. 39995)

Indexed As: Paquette (Bankrupt), Re

Alberta Court of Queen's Bench

Judicial District of Edmonton

Wachowich, A.C.J.

February 22, 1994.

Summary:

A financing statement registered by a credit union misnamed the debtor. The debtor subsequently made an assignment in bankruptcy. The trustee rejected the credit union's claim to be a secured creditor. The credit union appealed.

A Registrar of the Alberta Court of Queen's Bench, In Bankruptcy, in a decision reported 142 A.R. 305, dismissed the credit union's appeal. The credit union appealed.

The Alberta Court of Queen's Bench dis­missed the appeal.

Personal Property - Topic 6024

Security interests - Financing statements - Content of - The Alberta Court of Queen's Bench held that the Personal Property Security Act required that the financing statement include the debtor's name and the serial number - The serial number alone was not sufficient to perfect the security interest - The court also stated that the name used on the financing state­ment did not have to be the name on the debtor's birth certificate - Such a require­ment made the "seriously misleading" test too rigid and ignored the context and purposes of the Act - See paragraphs 6 to 11 and 19 to 21.

Personal Property - Topic 6024

Security interests - Financing statements - Content of - [See Personal Property - Topic 6092 ].

Personal Property - Topic 6069

Security interests - Registration - Defec­tive registration - Effect of - [See Per­sonal Property - Topic 6092 ].

Personal Property - Topic 6082

Security interests - Registration - Validity of - Name of debtor - [See Personal Property - Topic 6024 and Personal Property - Topic 6092 ].

Personal Property - Topic 6090

Security interests - Registration - Validity of - Material misdescriptions - [See Per­sonal Property - Topic 6092 ].

Personal Property - Topic 6092

Security interests - Registration - Validity of - Sufficiency of description - A fi­nancing statement registered by a credit union incorrectly named the debtor although the description of the collateral and the serial number were correct - The debtor made an assignment in bankruptcy - The trustee rejected the credit union's claim to be a secured creditor - The Alberta Court of Queen's Bench stated that the proper test to determine whether a name was seriously misleading was to consider "what search criteria a reasonable person would use, and would that search criteria disclose the security interest" - The court held that the creditor's security was not effective against the trustee, because there was a seriously misleading error.

Personal Property - Topic 6214

Security interests - Priorities - Trustee in bankruptcy - [See Personal Property - Topic 6092 ].

Cases Noticed:

Kelln (Bankrupt), Re, [1992] 3 W.W.R. 310; 100 Sask.R. 164; 18 W.A.C. 164; 9 C.B.R.(3d) 144; 89 D.L.R.(4th) 427; 3 P.P.S.A.C.(2d) 44 (C.A.), consd. [paras. 7, 27].

Ford Credit Canada v. Percival Mercury Sales Ltd. and Henke (Bankrupt), [1986] 6 W.W.R. 569; 50 Sask.R. 268 (C.A.), refd to. [para. 10].

Guenette, Re - see Miller, McClelland Ltd. v. Barrhead Savings and Credit Union Ltd.

Miller, McClelland Ltd. v. Barrhead Sav­ings and Credit Union Ltd. (1993), 142 A.R. 155 (Q.B. Registrar), refd to. [para. 12].

Haasen, Re (1992), 3 P.P.S.A.C.(2d) 250 (Ont. Gen. Div.), refd to. [para. 12].

Alberta (Treasury Branches) v. Triathalon Vehicle Leasing (1992), 7 Alta. L.R.(2d) 374 (Q.B.), refd to. [para. 17].

Chrysler Credit Canada Ltd. v. Webber (1993), 144 A.R. 232 (Q.B.), refd to. [para. 17].

General Electric Capital Equipment Finance Inc. v. Inland Kenworth Ltd. (1993), 81 B.C.L.R.(2d) 384 (S.C.), refd to. [para. 24].

Logan, Re (1993), 73 B.C.L.R.(2d) 377 (S.C.), refd to. [para. 26].

International Harvester Credit Corp. of Canada Ltd. v. Frontier Peterbilt Sales Ltd., [1983] 6 W.W.R. 328; 28 Sask.R. 48; 48 C.B.R.(N.S.) 278; 3 P.P.S.A.C. 86; 149 D.L.R.(3d) 572 (Q.B.), refd to. [para. 26].

Weber, Re (1990), 78 C.B.R.(N.S.) 224; 73 O.R.(2d) 238; 1 P.P.S.A.C.(2d) 36; 48 B.L.R. 1 (S.C.), refd to. [para. 27].

Statutes Noticed:

Personal Property Security Act, S.A. 1988, c. P-4.05, sect. 20(1), sect. 43(6), sect. 43(7), sect. 43(8), sect. 48(1), sect. 71(1)(e)(i), sect. 71(1)(e)(iii), sect. 71(1)(e)(iv) [para. 5].

Personal Property Security Act Regulations (Alta.), Reg. 234/90, sect. 16(1), sect. 17(1), sect. 17(2), sect. 26(1), sect. 27(1), sect. 27(2), sect. 29(1), sect. 29(2) [para. 5].

Authors and Works Noticed:

Cuming, Ronald C.C., and Wood, Roderick J., Personal Property Security Handbook (2nd Ed. 1993), pp. 5 [para. 22]; 320 [paras. 6, 17].

Counsel:

Brent W. Mielke, for the appellant, Edmonton Civic Employees Credit Union Ltd.;

John A. Pavlus, for the Trustee in Bank­ruptcy.

This appeal was heard before Wachowich, A.C.J., of the Alberta Court of Queen's Bench, Judicial District of Edmonton, who delivered the following judgment on Febru­ary 22, 1994.