Workers' Compensation Board (B.C.) v. Canadian Imperial Bank of Commerce et al., (1998) 105 B.C.A.C. 20 (CA)

• Judge: Lambert, Newbury and Proudfoot, JJ.A.
• Court: Court of Appeal (British Columbia)
• Case Date: March 12, 1998
• Jurisdiction: British Columbia
• Citations: (1998), 105 B.C.A.C. 20 (CA)

WCB v. CIBC (1998), 105 B.C.A.C. 20 (CA);

   171 W.A.C. 20

MLB headnote and full text

Temp. Cite: [1998] B.C.A.C. TBEd. MY.001

Workers' Compensation Board of British Columbia (petitioner/appellant) v. The Canadian Imperial Bank of Commerce and Lindstrom Construction Ltd. (respondents/respondents)

(Docket: CA022543)

Indexed As: Workers' Compensation Board (B.C.) v. Canadian Imperial Bank of Commerce et al.

British Columbia Court of Appeal

Lambert, Newbury and Proudfoot, JJ.A.

March 12, 1998.

Summary:

An employer was indebted to the Workers' Compensation Board. The employer sold one of its trucks to Lindstrom for value without notice. The sale proceeds were used to pay out the employer's indebtedness to a bank as the holder of a security interest in the truck. The Workers' Compensation Board pe­titioned for, inter alia, a declaration that the Board had a lien against the sale proceeds by virtue of s. 52 of the Workers' Compen­sation Act. The trial judge dismissed the petition, on the ground that another remedy was available and the Board did not pursue its remedies in a timely way. The Board appealed.

The British Columbia Court of Appeal dismissed the appeal.

Liens - Topic 2004

Particular or possessory lien - Nature of lien - The British Columbia Court of Appeal stated that a lien was a remedy in rem - At common law its existence depended upon one's continuous pos­session of property which was the subject of the lien - Although the lien has since expanded beyond its possessory origins, its essence was still that it bound or charged real or personal property - See paragraph 12.

Statutes - Topic 2414

Interpretation - Interpretation of words and phrases - Disjunctive words or phrases - Or - The British Columbia Court of Appeal held that the word "or" in s. 52 of the Workers' Compensation Act, R.S.B.C. 1996, c. 492, should be read disjunctively - See paragraph 24.

Workers' Compensation - Topic 8641

Assessments upon employers - Statutory liens against employers - General - Section 52 of the Workers' Compensation Act granted the Workers' Compensation Board a lien over the property or proceeds of property of an employer/debtor in priority over all liens, charges or mortgages of every person - The British Columbia Court of Appeal stated that s. 52 clearly implied that an existing lien, fully perfected and registered, could be displaced by the stat­ute, contrary even to the principle "nemo dat quod non habet" - See paragraph 26.

Workers' Compensation - Topic 8644

Assessments upon employers - Statutory liens against employers - Extent of lien - Section 52 of the Workers' Compensation Act granted the Workers' Compensation Board a lien over the property or proceeds of property of an employer/debtor in priority over all liens, charges or mort­gages of every person - The British Columbia Court of Appeal held that the use of the words "property or proceeds" did not mean that the Board was required to elect between one or the other, or that having elected one, it may not then pursue the other - See paragraphs 17 to 19.

Workers' Compensation - Topic 8644

Assessments upon employers - Statutory liens against employers - Extent of lien - Section 52 of the Workers' Compensation Act granted the Workers' Compensation Board a lien over the property or proceeds of property of an employer/debtor in priority over all liens, charges or mort­gages of every person - The British Columbia Court of Appeal held that the lien's priority did not apply to the interest of a bona fide purchaser of the employer/debtor's property for value with­out notice - See paragraphs 20 to 28.

Workers' Compensation - Topic 8647

Assessments upon employers - Statutory liens against employers - Charge on pro­ceeds of sale of employer's property - Section 52 of the Workers' Compensation Act granted the Workers' Compensation Board a lien over the property or proceeds of property of an employer/debtor in priority over all liens, charges or mort­gages of every person - The British Columbia Court of Appeal held that to enforce its lien against third parties the Board must do more than locate "property or proceeds" at one point in time - It must follow the property or proceeds through whatever conversions or inter-mingling occurred, and show that it remained identi­fiable - See paragraph 14.

Words and Phrases

Or - The British Columbia Court of Appeal held that the word "or" in s. 52 of the Workers' Compensation Act, R.S.B.C. 1996, c. 492, should be read disjunctively - See paragraph 24.

Cases Noticed:

Royal Bank v. Workmen's Compensation Board (N.S.), [1936] 4 D.L.R. 9 (S.C.C.), refd to. [para. 1].

Michaelis, Re, [1933] 1 W.W.R. 465 (Sask. C.A.), refd to. [para. 8].

Pauling's Settlement Trusts, Re, [1961] 3 All E.R. 713, affd. [1964] 1 Ch. 303 (C.A.), refd to. [para. 8].

Deschenes Drilling Ltd.\Les Forages Deschênes Ltée v. Mallet et al. (1996), 175 N.B.R.(2d) 233; 446 A.P.R. 233 (C.A.), refd to. [para. 8].

Nepean Hydro Electric Commission v. Ontario Hydro, [1982] 1 S.C.R. 347; 4 N.R. 1, refd to. [para. 8].

Betker v. Williams (1991), 8 B.C.A.C. 265; 17 W.A.C. 265; 63 B.C.L.R.(2d) 14 (C.A.), refd to. [para. 9].

Calgary (City) v. Lafarge Construction Materials, [1995] 10 W.W.R. 599; 169 A.R. 363; 97 W.A.C. 363 (C.A.), refd to. [para. 9].

Rio Alto Exploration Ltd. v. White (1990), 104 A.R. 84 (Q.B.), refd to. [para. 9].

Canada (Attorney General) v. Nalleweg (1996), 180 A.R. 208; 44 C.P.C.(3d) 307 (Q.B.), refd to. [para. 9].

Chapman v. Michaelson, [1908] 2 Ch. 612, affd. [1909] 1 Ch. 238, refd to. [para. 10].

Chassey v. May, [1925] 2 W.W.R. 199; 35 B.C.R. 113 (C.A.), refd to. [para. 12].

Roynat Inc. v. Glen Lake Village Inn Ltd. (1986), 11 B.C.L.R.(2d) 39 (S.C.), dist. [para. 20].

Thorndike v. Hunt (1859), 3 De G. & J. 563, refd to. [para. 22].

Taylor v. Blakelock (1886), 32 Ch. D. 560 (C.A.), refd to. [para. 22].

Edgar v. Plomley, [1900] A.C. 431 (P.C.), refd to. [para. 22].

Diplock, Re, [1948] 1 Ch. 465 (C.A.), affd. [1951] A.C. 251 (H.L.), refd to. [para. 22].

Board of Industrial Relations v. Avco Financial Services Realty Ltd. and Homeplan Realty Ltd. (1979), 28 N.R. 140; 18 B.C.L.R. 23 (S.C.C.), refd to. [para. 23].

Bank of Montreal v. Workmen's Compen­sation Board (1968), 66 D.L.R.(2d) 386, affd. (1967), 60 D.L.R.(2d) 680 (B.C.C.A.), refd to. [para. 23].

Warford v. Wood Motors (N.S.) Ltd. and Workmen's Compensation Board (N.S.) (1978), 30 N.S.R.(2d) 338; 49 A.P.R. 338; 88 D.L.R.(3d) 515 (T.D.), not folld. [para. 24].

Workmen's Compensation Board (B.C.) v. Sumas Oil & Gas Co., [1933] 3 D.L.R. 489 (C.A.), refd to. [para. 26].

Hays v. Similkameen Resorts Ltd. (1984), 60 B.C.L.R. 67 (S.C.), refd to. [para. 26].

MacMillian Bloedel Industry Ltd. and Kasiks River Contracting et al. v. British Columbia (Director of Employment Standards) (1983), 49 B.C.L.R. 190 (C.A.), consd. [para. 27].

Culhane v. Stuart (1883), 6 O.R. 97, refd to. [para. 29].

Cohen v. Mahlin, [1927] 1 D.L.R. 577 (Alta. C.A.), refd to. [para. 29].

Northern Counties of England Fire In­surance Co. v. Whipp (1884), 26 Ch. D. 482 (C.A.), refd to. [para. 29].

Statutes Noticed:

Limitation Act, R.S.B.C. 1996, c. 266, sect. 2(b) [para. 55].

Workers' Compensation Act, R.S.B.C. 1996, c. 492, sect. 52 [para. 1].

Authors and Works Noticed:

British Columbia, Law Reform Commis­sion, The Crown as Creditor: Priorities and Privileges (1982), p. 62 [para. 1].

Craies, Statute Law (7th Ed. 1971), p. 73 [para. 8].

Halsbury's Laws of England (4th Ed. 1976), vols. 16, paras. 911 [para. 22]; 931 [para. 11]; 1476 [para. 8]; 28, para. 502 [para. 12].

Hanbury and Martin, Modern Equity (14th Ed. 1993), pp. 643 to 646 [para. 13]; 666 [para. 22].

Snells, Principles of Equity (29th Ed. 1990), pp. 29, 34 [para. 8]; 302 [para. 29].

Waters, Donovan W.M., The Law of Trust in Canada (2nd Ed. 1984), generally [para. 13]; pp. 1041, 1042 [para. 22].

Zamir, Itzhac, The Declaratory Judgment (1962), generally [para. 10].

Counsel:

B. Parkin and S. Nielsen, for the appellant;

B.C. Cronquist, for the respondent, Canadian Imperial Bank of Commerce.

This appeal was heard at Vancouver, British Columbia, on October 31, 1997, before Lambert, Newbury and Proudfoot, JJ.A., of the British Columbia Court of Appeal.

On March 12, 1998, the judgment of the British Columbia Court of Appeal was delivered and the following opinions were filed:

Newbury, J.A. (Proudfoot, J.A., con­curring) - see paragraphs 1 to 31;

Lambert, J.A. - see paragraphs 32 to 60.