Royal Bank of Canada v. Hein Real Estate Corporation Ltd., Smith and Smith, (1977) 2 A.R. 575 (CA)

• Judge: McDermid, Lieberman and Morrow, JJ.A.
• Court: Court of Appeal (Alberta)
• Case Date: February 18, 1977
• Citations: (1977), 2 A.R. 575 (CA)

Royal Bk. v. Hein Real Estate Corp. (1977), 2 A.R. 575 (CA)

MLB headnote and full text

Royal Bank of Canada Ltd. v. Hein Real Estate Corporation Ltd. and Smith and Smith (third parties)

Indexed As: Royal Bank of Canada v. Hein Real Estate Corporation Ltd., Smith and Smith

Alberta Supreme Court

Appellate Division

McDermid, Lieberman and Morrow, JJ.A.

February 18, 1977.

Summary:

This case arose out a claim by the plaintiff bank on the basis of an assignment. The third parties assigned a portion of monies held for them by the defendant to a branch of the plaintiff bank. Subsequently the third parties moved and established a relationship with a different branch of the same bank. The third parties made two more assignments of portions of the monies held by the defendant to the new branch. The defendant assumed that the later assignments superceded the first and paid the monies to the new branch but not to the first. The plaintiff brought an action against the defendant on the basis of the first assignment. The Alberta Supreme Court, Trial Division, dismissed the action. The plaintiff appealed.

The Alberta Court of Appeal allowed the appeal and held that the defendant was obligated to recognize the first assignment. The Court of Appeal held that for the purpose of the assignments the two branches were separate entities and that the defendant was not entitled to assume that an assignment held by one branch replaced that held by the other.

Banks and Banking - Topic 1003

Branch banks - General principles - Status of branch banks inter se - The third parties assigned a portion of monies held for them by the defendant to a branch of the plaintiff bank - Subsequently the third parties moved and established a relationship with a different branch of the same bank - The third parties made two more assignments of portions of the monies held by the defendant to the new branch - The defendant assumed that the later assignments superceded the first and paid the monies to the new branch but not to the first - The Alberta Court of Appeal held that for the purpose of the assignments the two branches were separate entities - The Court of Appeal held that the defendant was not entitled to assume that an assignment held by one branch replaced that held by the other - The Court of Appeal held that the defendant was obligated to recognize all of the assignments.

Cases Noticed:

Metropolitan Investigation and Security v. C.F.I. Operating Col Ltd. (1972), 31 D.L.R.(2d) 190, refd to. [para. 13].

Prince v. Oriental Bank Corp., [1878] 3 A.C. 325, refd to. [para. 13].

Royal Bank of Canada v. Boyce (1966), 57 D.L.R.(2d) 683, refd to. [para. 13].

Bank of Montreal v. Dominion Bank (1921), 60 D.L.R. 403, refd to. [para. 13].

Counsel:

C.G. Docken, for the appellant;

R. Stengl, for the respondent.

This case was heard before McDERMID, LIEBERMAN and MORROW, JJ.A., of the Alberta Supreme Court, Appellate Division.

On February 18, 1977, MORROW, J.A., delivered the following judgment of the Appellate Division