Greymac Trust Co. v. Ontario (Ontario Securities Commission)

[1988] 2 SCR 172 Court SCC Decision date 1988-10-13 Docket 20146 English

PartiesGreymac Trust Company, Crown Trust Company and Seaway Trust Company Appellants·Ontario Securities Commission Respondent·Greymac Credit Corporation Respondent·Chorny Mortgage Investor Participants Respondent

Judges Dickson, Robert George Brian; McIntyre, William Rogers; Lamer, Antonio; Wilson, Bertha; La Forest, Gérard V.; L'Heureux-Dubé, Claire; Sopinka, John

Decision 6–1 Majority (6) · Dickson C.J. (1)

On appeal from Ontario

Subjects Trust

Majority

The judgment of the Court was delivered orally by

Dickson C.J.

1. The Chief Justice‑‑It will not be necessary to call upon you Mr. Lax. The issue in this appeal is whether the Ontario Court of Appeal erred in failing to apply the "first‑in, first‑out" rule in Clayton's Case, Devaynes v. Noble; Clayton's Case (1816), 1 Mer. 572, 35 E.R. 781, in the allocation of losses between beneficiaries where a trustee has made unauthorized disbursements from an active bank account into which the beneficiaries' funds have been placed and insufficient funds remain to reimburse each of the beneficiaries in full.

2. We are not persuaded by the appellants' argument that the Ontario Court of Appeal so erred. On the contrary, we agree with the conclusion of the Court of Appeal and we adopt the reasons therefore delivered by Morden J.A. on behalf of the Court.

3. The appeal is accordingly dismissed with costs.

Judgment accordingly.

Solicitors for the appellants: McMillan, Binch, Toronto.

Solicitors for the respondent Chorny Mortgage Investor Participants: Goodman & Goodman, Toronto.