Roscoe Enterprises Ltd. v. Wasscon Construction Inc. et al., (1998) 169 Sask.R. 240 (QB)

• Judge: Zarzeczny, J.
• Court: Court of Queen's Bench of Saskatchewan (Canada)
• Case Date: June 18, 1998
• Jurisdiction: Saskatchewan
• Citations: (1998), 169 Sask.R. 240 (QB)

Roscoe Ent. Ltd. v. Wasscon Contr. (1998), 169 Sask.R. 240 (QB)

MLB headnote and full text

Temp. Cite: [1998] Sask.R. TBEd. JL.021

Roscoe Enterprises Ltd. (plaintiff) v. Wasscon Construction Inc., Canadian Tire Real Estate Limited, Norm's Quality Foundations Ltd., William J. Ozem, ASL Paving Ltd., Loewenhardt Construction Ltd., Jordan Asbestos Removal Ltd., Artistic Landscaping & Supplies (1996) Ltd., Ed Nelson, A.K. Euteneier & Sons Trucking Ltd., Harding Boss & McLeod Surveys Ltd., Serbu Sand & Gravel Ltd. (defendants)

(1997 Q.B.G. No. 879)

Indexed As: Roscoe Enterprises Ltd. v. Wasscon Construction Inc. et al.

Saskatchewan Court of Queen's Bench

Judicial Centre of Regina

Zarzeczny, J.

June 18, 1998.

Summary:

Wasscon, a contractor, paid monies into court, pursuant to an application and order made under s. 56 of the Builders' Lien Act. Some of the funds were paid out. In the meantime, unknown to the lien claimants or the court, a petition was filed in Ontario petitioning Wasscon into bankruptcy. One of the lien claimants applied for an order under the Builders' Lien Act determining entitle­ment to the monies remaining in court.

The Saskatchewan Court of Queen's Bench held that the trustee in bankruptcy was entitled to the remaining funds under the Bankruptcy and Insolvency Act.

Bankruptcy - Topic 438

Property of bankrupt - Particular property - Fund for payment of contingent debt - Wasscon, a contractor, paid monies into court, pursuant to an application and order made under the Builders' Lien Act (the Act) - Some of the funds were paid out - In the meantime, unknown to the lien claimants or the court, a petition was filed in Ontario petitioning Wasscon into bank­ruptcy - A lien claimant applied for an order under the Act determining entitle­ment to the remaining monies - It argued, inter alia, that the funds did not constitute "property of the bankrupt" - The Saskat­chewan Court of Queen's Bench rejected the argument and directed that the monies be paid over to the trustee under the Bankruptcy and Insolvency Act - See paragraphs 32 to 37.

Bankruptcy - Topic 3642

Creditors - General - Priorities - Preced­ence of Bankruptcy and Insolvency Act over provincial legislation - Wasscon, a contractor, paid monies into court, pursu­ant to an application and order made under the Builders' Lien Act (the Act) - Some of the funds were paid out - In the meantime, unknown to the lien claimants or the court, a petition was filed in Ontario petitioning Wasscon into bankruptcy - A lien claim­ant applied for an order under the Act deter­mining entitlement to the remaining monies - It argued, inter alia, that the funds were "trust funds" as defined by s. 7 of the Act and s. 67(1)(a) of the Bank­ruptcy and Insolvency Act (BIA) - The Saskatchewan Court of Queen's Bench rejected the argument - The trust created by s. 7 of the provincial Act did not qual­ify as a trust under s. 67 of the BIA - The court directed that the monies be paid over to the trustee under the BIA - See para­graphs 18 to 31.

Bankruptcy - Topic 3645

Creditors - General - Priorities - Statu­tory liens and charges - Force and effect of - [See Bankruptcy - Topic 3642 ].

Bankruptcy - Topic 3923

Secured creditors - What constitutes a secured creditor - Persons who are not secured creditors - Wasscon, a contractor, paid monies into court, pursuant to an application and order made under the Builders' Lien Act (the Act) - Some of the funds were paid out - In the meantime, unknown to the lien claimants or the court, a petition was filed in Ontario petitioning Wasscon into bankruptcy - A lien claim­ant applied for an order under the Act deter­mining entitlement to the remaining monies - It argued, inter alia, that the lien claimants were "secured creditors" as defined by s. 2(1) of the Bankruptcy and Insolvency Act (BIA) - The Saskatchewan Court of Queen's Bench rejected the argu­ment and directed that the monies be paid over to the trustee under the BIA - See paragraphs 32 to 37.

Bankruptcy - Topic 3924

Secured creditors - What constitutes a secured creditor - Statutory liens - Gen­eral - [See Bankruptcy - Topic 3923 ].

Mechanics' Liens - Topic 7630

Trust fund - Priorities - Where contractor becomes bankrupt - [See Bankruptcy - Topic 3642 ].

Cases Noticed:

British Columbia v. Henfrey Samson Be­lair Ltd., [1989] 2 S.C.R. 24; 97 N.R. 61; 59 D.L.R.(4th) 726, refd to. [para. 22].

Husky Oil Operations Ltd. v. Minister of National Revenue et al., [1994] 1 W.W.R. 629; 116 Sask.R. 46; 59 W.A.C. 46 (C.A.), refd to. [para. 24].

Bourgault's Estate v. Quebec (Minister of Revenue), [1980] 1 S.C.R. 35; 30 N.R. 24; 105 D.L.R.(3d) 270; 33 C.B.R.(N.S.) 301, refd to. [para. 24].

Minister of Revenue v. Rainville - see Bourgault's Estate v. Minister of Rev­enue of Quebec.

Jacs Jackets and Crests Ltd., Re; Workers' Compensation Board (Alta.) v. Deloitte, Haskins and Sells Ltd., [1985] 1 S.C.R. 785; 60 N.R. 81; 63 A.R. 321; 19 D.L.R.(4th) 577, refd to. [para. 24].

Federal Business Development Bank v. Commission de la santé et de la sécurité du travail et al., [1988] 1 S.C.R. 1061; 84 N.R. 308; 14 Q.A.C. 140; 50 D.L.R.(4th) 577, refd to. [para. 24].

Factory Window and Door Ltd. (Bank­rupt), Re (1995), 135 Sask.R. 235 (Q.B.), agreed with [para. 25].

Tradmor Investments Ltd. v. Valdi Foods (1987) Inc. (1995), 33 C.B.R.(3d) 244 (Ont. Gen. Div.), refd to. [para. 36].

Statutes Noticed:

Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, sect. 2(1), sect. 67(1), sect. 70(1) [para. 17].

Builders' Lien Act, S.S. 1984-85-86, c. B-7.1, sect. 7(1), sect. 7(2), sect. 56(1), sect. 56(2), sect. 56(6), sect. 56(7), sect. 56(8), sect. 56(9) [para. 17].

Counsel:

Michael B. Griffin, for the plaintiff;

Rick M. Van Beselaere, for Canadian Tire Real Estate Ltd.;

Dale S.S. Szakacs, for William J. Ozem;

Dirk Silversides, for ASL Paving Ltd.;

David J. Bishop, for Loewenhardt Con­struction Ltd.;

F. William Johnson, Q.C., for Jordan Asbestos Removal Ltd.;

Michael B. Griffin, for Artistic Landscap­ing & Supplies (1996) Ltd.;

Paul J. Harasen, for the KPMG Inc. as Trustee in Bankruptcy for Wasscon Con­struction Inc.

This application was heard by Zarzeczny, J., of the Saskatchewan Court of Queen's Bench, Judicial Centre of Regina, who delivered the following fiat on June 18, 1998.