Saskatchewan Wheat Pool et al. v. Smith, (1996) 142 Sask.R. 285 (QB)

• Judge: Wright, J.
• Court: Court of Queen's Bench of Saskatchewan (Canada)
• Case Date: May 09, 1996
• Jurisdiction: Saskatchewan
• Citations: (1996), 142 Sask.R. 285 (QB)

Sask. Wheat Pool v. Smith (1996), 142 Sask.R. 285 (QB)

MLB headnote and full text

Saskatchewan Wheat Pool and Grasslands Cattle Management Ltd. (formerly known as GCMC Cattle Management Limited) (applicants) v. Harry Smith and Craig Smith (respondents)

(1996 Q.B.G. No. 1024)

Indexed As: Saskatchewan Wheat Pool et al. v. Smith

Saskatchewan Court of Queen's Bench

Judicial Centre of Regina

Wright, J.

May 9, 1996.

Summary:

Saskatchewan Wheat Pool and Grasslands Cattle Management, the applicants, had security interests in the Moultons' cattle. The Moultons transferred some of the cattle to the Smiths for payment for feed. The appli­cants applied for a declaration that they had priority to the cattle.

The Saskatchewan Court of Queen's Bench granted the declaration and ordered the Smiths to deliver the cattle to the applicants within 14 days, with a complete inventory of the cattle identifying each animal as well as any progeny and indicating their location. The court rejected the Smiths' claim for compensation for care of the cattle (agistment).

Animals - Topic 3481

Bailment of animals - Agistment - Gen­eral - The Moultons transferred some cattle to the Smiths for payment for feed - The applicants had security interests in the cattle - The Saskatchewan Court of Queen's Bench found that the Smiths had notice of the security interests and ordered them to deliver the cattle to the applicants - The court rejected the Smiths' claim for compensation for care of the cattle (agistment) - The court stated that "[t]he concept of agistment ... depends on an implied promise that the owner of cattle will pay for the feed and care provided to his or her animals by another. There was no such promise here. The respondents had possession of the animals as owners, and it was never contemplated that if they had to give them up as a result of their unjustified acts, they would be compensated for any loss they suffered for care and feeding." - See paragraph 41.

Personal Property - Topic 6201.1

Security interests - Priorities - Effect of actual notice - The Moultons transferred some cattle to Harry and Craig Smith for payment for feed - Saskatchewan Wheat Pool (SWP) and Grasslands Cattle Man­agement (GCM) had security interests in the cattle - There was uncontradicted evidence that Harry Smith removed SWP ear tags from some of the cattle - The Saskatchewan Court of Queen's Bench held that the cattle were disposed of in the ordinary course of business, but that Harry Smith had notice of the security interests - The court held that any notice Harry Smith had of the security interests could not be imputed to Craig Smith where they were not in partnership - The court ordered the Smiths to deliver the cattle to SWP and GCM within 14 days - See paragraphs 20, 34, 35.

Personal Property - Topic 6426

Security interests - Purchase-money security interests - Priorities - [See Per­sonal Property - Topic 6463 ].

Personal Property - Topic 6463

Security interests - Loss of title to third parties - Goods sold or leased in ordinary course of business - What constitutes - The Moultons, cattle farmers, transferred some cattle to the Smiths, grain farmers, for payment for feed - Saskatchewan Wheat Pool and Grasslands Cattle Man­agement had security interests in the cattle - They deposed that an ordinary course sale in the cattle industry occurred at a public market controlled by government regulations - The Smiths deposed that the Moultons routinely sold cattle to other farmers and regularly advertised their cattle for sale to other farmers - The Saskatchewan Court of Queen's Bench held that the transfer was in the ordinary course of business - However, the security inter­ests had priority where, inter alia, the cattle were delivered to satisfy a debt or past liability - See paragraphs 14 to 19, 22 to 33, 36 to 40.

Cases Noticed:

Pacific Mobile Corp., Re, [1985] 1 S.C.R. 290; 57 N.R. 63, refd to. [para. 15].

Fairline Boats Ltd. v. Leger et al. (1980), 1 P.P.S.A.C. 218 (Ont. H.C.), refd to. [para. 16].

Camco Inc. v. Olson (Frances) Realty (1979) Ltd. et al. (1986), 50 Sask.R. 161 (C.A.), refd to. [para. 17].

Royal Bank of Canada v. 216200 Alberta Ltd., [1987] 1 W.W.R. 545; 51 Sask.R. 146 (C.A.), refd to. [para. 17].

Royal Bank of Canada v. Wheaton Pontiac Buick Cadillac GMC Ltd. and Deschner (1990), 88 Sask.R. 151 (Q.B.), refd to. [para. 17].

Alberta Pacific Leasing Inc. v. Petro Equipment Sales Ltd. (1995), 175 A.R. 175; 10 P.P.S.A.C.(2d) 69 (Q.B. Master), refd to. [paras. 18, 33].

Statutes Noticed:

Personal Property Security Act, S.S. 1993, c. P-6.2, sect. 30(1)(b), sect. 30(2), sect. 30(8) [para. 13].

Authors and Works Noticed:

Cuming, R.C.C., and Wood, R.J., Saskatchewan and Manitoba Personal Property Security Acts Handbook (1994), p. 231 [para. 14].

Counsel:

J.N. Grubb, for the applicant, Saskatchewan Wheat Pool;

K. Mellor, for the applicant, Grasslands Cattle Management Ltd.;

M.M. Tobin, for the respondents.

This application was heard by Wright, J., of the Saskatchewan Court of Queen's Bench, Judicial Centre of Regina, who delivered the following decision on May 9, 1996.