Westeel-Rosco Ltd. v. Edmonton Tinsmith Supplies Ltd. and Roy, (1985) 68 A.R. 24 (QB)

• Judge: Virtue, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: November 14, 1985
• Citations: (1985), 68 A.R. 24 (QB)

Westeel-Rosco Ltd. v. Edmonton Tinsmith (1985), 68 A.R. 24 (QB)

MLB headnote and full text

Westeel-Rosco Ltd. v. Edmonton Tinsmith Supplies Ltd. and Roy

(No. 98915)

Indexed As: Westeel-Rosco Ltd. v. Edmonton Tinsmith Supplies Ltd. and Roy

Alberta Court of Queen's Bench

Judicial District of Edmonton

Virtue, J.

November 14, 1985.

Summary:

A creditor commenced an action to recover on a guarantee when the principle debtor defaulted. The Alberta Court of Queen's Bench dismissed the creditor's action because the guarantee was one to which the Guarantees Acknowledgement Act applied and since it was not executed in accordance therewith, was ineffective.

Evidence - Topic 3120

Secondary evidence - Lost or destroyed documents - General principles - The Alberta Court of Queen's Bench discussed when secondary evidence may be admitted to prove the contents of a document that was lost or destroyed - See paragraphs 17 to 21.

Evidence - Topic 3125

Secondary evidence - Lost or destroyed documents - Copy of lost document - A creditor sought to enforce a guarantee but the only documentary evidence of the guarantee was a photostatic copy - The Alberta Court of Queen's Bench admitted the photostatic copy where it was satisfied that the original document existed, that the original was lost or destroyed and that a search for the original was made - See paragraphs 17 to 21.

Guarantee and Indemnity - Topic 124

The contract - Formation of - Non est factum - General - The Alberta Court of Queen's Bench discussed generally the defence of non est factum as it related to guarantees - The court refused to allow a guarantor to rely on the defence where he was unable to satisfy the burden on him of establishing the defence and whereby reason of his own lack of care in dealing with the document he was estopped from relying on the defence - See paragraph 26 to 43.

Guarantee and Indemnity - Topic 176

The contract - Form - Signature - The president and sole shareholder of Edmonton Tinsmith Supplies Ltd. signed a document which was allegedly a guarantee - The document had the name of the company at the bottom under which there was the signature of the president - Underneath his signature was his named typed with (guarantor) thereafter - The Alberta Court of Queen's Bench held that the document was a guarantee by the president of the company, notwithstanding the manner in which it was signed - See paragraphs 22 to 26.

Guarantee and Indemnity - Topic 184

The contract - Form - Statutory execution requirements - Exemptions - The Guarantees Acknowledgment Act provided that guarantees executed not in compliance with the Act were ineffective - Section 1(a)(iv) excluded guarantees made "on the sale of an interest in goods ..." - The Alberta Court of Queen's Bench held that a guarantee to extend credit for past and future indebtedness for goods was not a guarantee "on the sale of ... goods" such as to be exempted from the Act - The court stated that the fact that the guarantee was given at the time of a sale of one item of goods in a lengthy series of sales and payments did not make the guarantee one given "on the sale of ... goods" - See paragraphs 49 to 63.

Guarantee and Indemnity - Topic 2517

Discharge and other defences of surety - Noncompliance with guarantee legislation - The Alberta Court of Queen's Bench released a guarantor for liability under a guarantee where the guarantee was not executed in compliance with the Guarantees Acknowledgement Act because, inter alia, it lacked a notarial certificate - See paragraphs 49 to 63.

Interest - Topic 2024

Agreement to pay interest - What constitutes - Notice on invoices - A creditor sought to collect on a guarantee for the principal amount owing by the debtor for goods plus an amount for accrued interest - The guarantor argued that the debtor did not agree to pay interest - The Alberta Court of Queen's Bench held that there was an agreement to pay interest where all invoices sent to the debtor by the creditor contained a notice that "a service charge of 1.5% will be charged on overdue accounts" and the account was paid on that basis - See paragraphs 44 to 46.

Interest - Topic 5302

As damages - Prejudgment interest - Interest on payment of money or debt withheld - Improper withholding - What constitutes - A creditor sought to collect on a guarantee for the principle amount due for goods purchased by the debtor plus an amount for service charges or interest accrued on overdue amounts - The Alberta Court of Queen's Bench held that the indebtedness although a just debt was not a debt improperly withheld so as to come within the pertinent provisions of the Judicature Act respecting interest - See paragraph 44.

Words and Phrases

On the sale of an interest in goods or chattels - The Alberta Court of Queen's Bench discussed the meaning of the phrase "on the sale of an interest in goods or chattels" as it appeared in s. 1(a)(iv) of the Guarantees Acknowledgment Act, R.S.A. 1980, c. G-12 - See paragraphs 49 to 63.

Cases Noticed:

Lilwall v. Stockford, [1934] 3 W.W.R. 747 (Sask. C.A.), refd to. [para. 20].

Ontario Marble Co. Ltd. v. Creative Memorials Ltd. et al., 39 D.L.R.(2d) 149 (Sask. Q.B.), consd. [para. 24].

Marvco Color Research Ltd. v. Harris et al. (1982), 45 N.R. 302; 141 D.L.R.(3d) 577, refd to. [para. 30].

Teacher's Investment and Housing Co-Operative v. S.H. Properties Ltd. and Halabi (1984), 55 A.R. 251; 33 Alta. L.R.(2d) 132, refd to. [para. 32].

Saunders v. Anglia Building Society, [1971] A.C. 1004, refd to. [para. 33].

Robert Simpson Company Limited v. Balaleika Restaurants Ltd. (1980), 27 A.R. 344; consd. [para. 53].

Goodyear Tire and Rubber Company of Canada Ltd. v. Knight and Kunzli and Russill, 33 W.W.R.(N.S.) 87 (Alta. S.C.), consd. [para. 57].

Ampex of Canada Limited v. Thomson and Thomson (1979), 33 A.R. 260, consd. [para. 59].

Keillian West Ltd. v. Sportspage Enterprises Ltd. and Vogel (1982), 40 A.R. 586; 23 Alta. L.R.(2d) 99 (Alta. Q.B.), consd. [para. 60].

Crown Lumber Company Limited v. Engel and Engel, 36 W.W.R.(N.S.) 129 (Alta. C.A.), consd. [para. 61].

Statutes Noticed:

Guarantees Acknowledgment Act, R.S.A. 1980, c. G-12, sect. 1(a)(iv) [para. 50]; sect. 3, sect. 4 [para. 4].

Judicature Act, R.S.A. 1980, c. J-1 [para. 44].

Authors and Works Noticed:

Canadian Encyclopedic Digest (Western Ed.), vol. 7, paras. 168 [para. 27]; 172 [para. 29]; 175 [para. 28].

Halsbury's Laws of England (2nd Ed.), vol. 13, p. 648 [para. 20].

Sopinka, Evidence in a Civil Trial, p. 281 [para. 19].

Counsel:

T.M. Kulasa, for the plaintiff;

E.J. Erler, for Jean P. Roy;

This case was heard before Virtue, J., of the Alberta Court of Queen's Bench, who delivered orally the following decision on November 14, 1985: