Royal Bank of Canada v. MacKenzie

SMrrH J.-One William McLennan, now deceased, had a sheep ranch in the vicinity of Suffield in the province of Alberta, and made a chattel mortgage dated 20th December, 1929, to the appellant, to secure $9,500 and interest on chattels described as follows:

These chattels are stated to be now in the possession of the mortgagor and to be situate on " all of the South Half and North-west Quarter of Township Fifteen (15), Range Eight (8), West of the Fourth Meridian, in the Province of Alberta." The mortgagor died on the 28th day of May, 1930, insolvent, and the (plaintiff) respondent is one of the unsecured creditors suing on behalf of himself and other creditors of the deceased mortgagor, to have it declared that the chattel mortgage referred to is void as against the creditors of the mortgagor.

The first ground of attack is that the description quoted above does not satisfy the provisions of the Bills of Sale Act of Alberta (1929, c. 12, s. 5), which provides as follows: I agree with the learned trial judge that the clause following the enumeration of the sheep means all the sheep belonging to the mortgagor, and that it is not necessary to introduce any words not there.

If that clause stood alone as a description of the sheep, there would be no doubt as to its meaning, and I do not see that the meaning is changed by the preceding particulars as to the numbers of sheep in each of the different classes.

As the learned trial judge points out, the cases establish that the description is sufficient when it is apparent that the mortgage covers all the chattels of the specified kind owned by the mortgagor. McCall v. Wolff (1); Hovey v. Whiting (2); Thomson v. Quirk (3).

The mere fact that the mortgagor has stated in the mortgage a larger number of sheep than he actually owned cannot make the mortgage void as to the sheep he did own. The description of the horses is, as the learned trial judge finds, insufficient.

The second objection to the validity of the mortgage is that the affidavit of bona fides does not comply with the statutory requirement.

There is on the printed form of mortgage used a printed blank form of affidavit in use apparently before the enactment of the statute as it now stands, which provides for a different form of affidavit. The conveyancer undertook to adapt the printed form of affidavit on the document by striking out the unsuitable part and substituting, in typewriting, what was necessary. He made use of the preliminary part of the printed form down to the words "make oath and say ", and covered over all the printed words following these down to the jurat by pasting over them a sheet containing, in typewriting, all the allegations required by the statute. As this typewriting took up more space than that occupied by the printed words covered up, the bottom part of the typewritten sheet extends beyond the part of the printed form so covered over. The jurat of the printed form is used and the commissioner initials in the margin this typewritten sheet. Much as one is inclined to censure the slovenliness of this kind of conveyancing, I am of opinion that in fact the affidavit complies with the statutory requirement. We have the preliminary part of the affidavit followed in typewriting by all the allegations required, and then the jurat. Pasting the substituted sheet over the printed words not intended to form part of the affidavit was a mode of erasure of these words and substitution of the typewritten words, and, being initialed by the commissioner, this erasure and substitution is authenticated and leaves no ground for doubt as to what the affidavit sworn to by the deponent really was. The fact that by holding the document up to the light the printed words covered over or part of them may be read, seems to me to make no difference, the intent to erase or blot out being manifest. When words in a document are erased as is usually done by drawing a pen through them, they remain legible, but it does not follow that they are not erased.

I agree with the learned trial judge that the statements in the affidavit are in compliance with the statute. 'I The chattel mortgage, therefore, is a security on all the J. mortgagor's sheep, valid as against the creditors of the mortgagor, but invalid as a security on the horses mentioned.

As to the security under section 88 of the Bank Act, I am in accord with the view of Mr. Justice Clarke of the Appellate Division.

Section 88, subsection 12, of the Bank Act, R.S.C., 1927, Chap. 12, authorizes a bank to lend money to any person engaged in stock raising upon the security of his live stock, and by subsection 14 it is provided that: In this case, form C was used instead of form E, and as subsection 14 is only directory the whole question is as to whether what is contained in the form C used is to the like effect of what is required by form E.

The learned trial judge found that, in two respects, what is stated in the form used fails to comply with what is required by form E, namely, that the advance was made on the security of the live stock mentioned in it, and that the security was given under subsection 12 of section 88, the particular subsection 12 not being mentioned. As to the first of these objections, the document states that in consideration of an advance of $2,000 made by the Bank to the undersigned, for which the Bank holds bills or notes, the live stock or dead stock or the products thereof, mentioned below, is hereby assigned to the Bank as security for the payment of said bills or notes. I am unable to understand how it can be said that this fails to be a statement that the advance was made on the security of the live stock mentioned. I think it is a clear statement to that effect.

The other objection, that the document states that the security is given under the provisions of section 88 of the Bank Act instead of "under the provisions of subsection twelve of section eighty-eight," seems to me to be of little