Guillot v. Lefaivre

The bankrupt, a general contractor, entered into an agreement with the appellant who, described as master-mason on his business letterhead, was also known as a working mason. The work to be done was the labour, including the scaffolding, for the brick-work (lambrissage) of four houses under construction by the bankrupt, the latter to furnish the bricks and nails. The mortar was in fact supplied by the bankrupt, though the appellant was to furnish it under the agreement.

The work was actually performed by the appellant and by his son and some other workmen who were hired and paid by him. The appellant filed with the trustees in bankruptcy a claim for $1,018.20, being the amount due for his own work and the wages paid to his helpers, in order that the same be paid in priority under section 121 of the Bankruptcy Act, out of the distribution of the bankrupt's property.

The trustees disallowed the claim for priority, the Superior Court sitting in bankruptcy affirmed such disallowance and the appellate court maintained that judgment.

Held, affirming the judgment appealed from, that the appellant's claim was not for "compensation of * * * workman in respect of services rendered to the bankrupt" within the meaning of paragraph 3 of section 121 of the Bankruptcy Act. The word "compensation" may include personal work or labour performed by the claimant personally, but does not include wages earned on the work by his son and the other helpers employed and paid by the appellant.- Upon the facts of the case, the appellant should be considered as a sub-contractor and not as a "workman."

APPEAL (1) from the judgment of the Court of King's Bench, appeal side, province of Quebec, affirming the judgment of the Superior Court sitting in bankruptcy, (1) Leave to appeal to this Court was granted by The Chief Justice in Chambers.

Rinfret C.J. and Kerwin, Hudson, Rand and Estey JJ. Savard J. and disallowing the petitioner's claim filed with the trustees in bankruptcy that the same be paid in priority.

The CHIEF Je ne vois aucune raison d'infirmer le jugement de premibre instance confirm6 par celui de la Cour du Banc Roi (en appel).

Tout le litige d6pend de 1'interpr6tation de l'article 121 de la Loi de Faillite.

Cet article a trait A la priorit6 des r6clamations de certains ouvriers et il stipule au troisibme paragraphe que: Pour d6terminer le sort de cet appel, il s'agit d'interpriter dans le paragraphe que l'on vient de citer, les mots r6mun6rations ", " ouvriers " et " services ".

En effet, ce que l'appelant r6clame ne peut 6tre class6 dans la cat6gorie des "gages", "salaires" ou "commissions "; non plus dans celle des "commis ", " domestiques "voyageurs de commerce " ou "journaliers ".

Pour rdussir, il fallait qu'il d6montre que sa r6clamation est pour " r6mun6ration " h titre d'ouvrier " pour services rendus au failli ".

Or, les syndies intim6s ont, k mon avis, justement repr6sent6 que l'appelant n'avait jamais 6t6 h 1'emploi du failli h titre de salari6, que les travaux qu'il avait faits pour le failli lui-mime 6taient accordis par contrat a forfait et que sa r6clamation, par consequent, ne pouvait 6tre accept6e autrement que comme cr~ance chirographaire par opposition avec une cr6ance privil6gi6e.

La r6clamation de 1'appelant repr6sente: l'ouvrage en brique i la maison de Yvon Lepage, situ6e dans la paroisse de St-Sacrement h Qu6bec, et h deux autres maisons situ6es sur la rue Vitr6; la construction d'une cheminde a une maison vendue h un monsieur Marcoux.

Ces ouvrages ont 6t6 confi6s h 1'appelant au moyen d'un contrat sur lequel ce dernier s'est donn6 comme entrepreneur-magon.

Il s'y est engage A faire le lambrissage des maisons ci-haut mentionn6es pour le compte du failli, h raison de $180.00 pour les petites maisons et $205.00 pour les plus grandes; la brique et les clous devaient 6tre fournis par le contracteur g6nbral (le failli), le mortier et les 6chafaudages devant 6tre fournis par le briquetier (1'appelant). Le failli s'y engageait h payer un estim6 de 90o h toutes les semaines.

Le montant total, auquel l'appelant a droit pour ces ouvrages, s'6lve h la somme de $1,018.20.

Le mot " r6mundration " est sans doute tris large et, pour les fins de cet appel, je serais certainement dispos6 A pKendre pour acquis qu'il peut comprendre les montants stipulds au contrat en faveur de 1'appelant et qui font l'objet de sa reclamation.

Mais, d'autre part, il est admis que dans cette somme sont inclus les salaires qui ont 6t6 pay6s par 1'appelant h quelques ouvriers qui lai ont aid6 accomplir les travaux qu'il avait entrepris. .

II ne s'agit donc pas ici exclusivement de sa r6mundration personnelle, mais 6galement de la r~mun6ration de ceux qui lui ont aid6 dans ses ouvrages.

D6jA, par cons6quent, nous nous bloignons des " services rendus au failli ". II ne r6clame pas seulement pour ses services mais pour ceux de ses employ6s; et pr6cis6ment oii je ne puis me rendre h 1'argumentation de son procureur, c'est lorsqu'il s'agit de le faire entrer sous la d6signation d'ouvrier.

Je crois que le savant juge de premibre instance a eu raison de dire que nous sommes en pr6sence d'un contrat et que l'appelant

S.C.R.]

Ce n'est pas nicessairement parce que l'appelant devait Gunor fournir lui-mgme ses 6chafaudages et le mortier que cette stipulation du contrat l'exclut de la cat6gorie des ouvriers; mais c'est parce que dans 1'ex6cution du contrat, il a engag6 des ouvriers qu'il a choisis, dont il devait le temps et qu'il a pay6s.

C'est bien ainsi que le contrat devait 6tre ex6cut6 de la part de 1'appelant, et c'est ainsi que les deux parties contractantes 1'ont compris.

A raison de cela, l'appelant agissait comme entrepreneur ind6pendant; il ne r6clame pas le loyer de son ouvrage, il r6clame le prix fixe de son contrat. ne peut 6tre consid6r6 comme un ouvrier au sens de Particle 121 de la Loi de Faillite. Il n'a done pas droit A la priorit6 qui y est mentionnie, et je crois que les jugements dans cet appel doivent 6tre confirmis.

L'appel doit 6tre rejet6 avec depens.

KERWIN J.:-The appellant David Guillot filed with the trustees in bankruptcy of El6odore Rousseau a claim to be paid $1,018.20 "thirdly" in priority in the distribution of the bankrupt's property under section 121 of the Bankruptcy Act.

No question arises as to the amount or that the appellant is entitled to rank as an ordinary creditor but the trustees disallowed the claim for priority, a judge of the Superior Court in Quebec sitting in bankruptcy affirmed such disallowance, and the Court of King's Bench (Appeal Side), by a majority, dismissed an appeal from the order of the Superior Court. By leave granted under section 174 of the Bankruptcy Act, Guillot now appeals to this Court.

The judge of first instance and the majority of the Court of King's Bench proceeded, in part at least, upon a reference to the provisions of the Quebec Civil Code, articles 1684 et seq., and particularly 1696.

This is not a correct approach to section 121 of the Bankruptcy Act, which is a law of general application throughout the Dominion. The relevant part thereof reads:- Once a person falls within the enumeration "clerk, servant, travelling salesman, labourer or workman," it would difficult to exclude the remuneration to which he was entitled from the preceding words "wages, salaries, commissions or compensation."

But there is an additional feature to be considered,that is as to whether such remuneration was "in respect of services rendered to the bankrupt or assignor." Now it appears to have been generally assumed in the cases in the provincial courts to which our attention was drawn that it was not necessary that the workman should have rendered services exclusively to the bankrupt, and with that view I agree.

Cases may be envisaged where he would be an independent contractor and still fall within the section and I am, therefore, unable to agree with certain expressions used in some of the decisions indicating that it was considered that the element of control must be present. In contracts for certain jobs to be done by workmen, the employer might, or might not, have the right of supervision over the manner of execution and for this reason it should not weigh against the appellant that the sheet of note-paper on which the first contract was written had a letter-head indicating that he was an "entrepreneur-magon".

However, the services must, in the main, consist of personal work or labour on the part of the claimant but they will not lose that character merely because a claimant, in order to perform the labour, requires the use of the tools of his trade or the assistance of a helper. Just what would be included in .tools may be a question of some nicety in particular circumstances.

In the present case the use by Guillot of his own scaffolding and the ordinary bricklayers' tools could properly be included but the fact that he had the assistance of his son and several other workmen, all of whom were hired and paid by him, is fatal to his claim.

Mr. Hudon relied upon two decisions, one of Chief Judge Bacon in Ex parte Allsop (1) and the other of Cave J. in Ex parte Hollyoak, Re Field (2). While the first may fall within the rules mentioned above, it is K J difficult to say the same of the latter although the short report of the case that appears in the Weekly Reporter and in Morrell, may omit something of importance. In any event, if these decisions are at variance with what has been stated, they should not be considered as authoritative in Canada.

Although a question was raised from the bench as to whether the appellant's claim could be divided so as to show the amount paid by Guillot to his helpers, leaving, presumably the balance of the claim to represent his own labour, no endeavour was made by counsel for either party to do this. Upon an examination of the record, I gather it was felt that this would be impossible since the appellant had contributed to the Workmen's Compensation Commission and to the Joint Committee of Construction in relation to the work done for the bankrupt. The appeal should be dismissed with costs.

J.:-The question in this appeal is whether the appellant is a workman within section 121 of the Bankruptcy Act, and entitled to be preferred as for compensation for services rendered to the bankrupt. The material part of the section reads as follows:

earned within three months of the date of the receiving order or assignment, when the said good have been shipped, delivered or paid for within three months of the receiving order or assignment; and provided. GuLo moreover, that any advances made on account of such commissions shall be deemed to have been legally paid on account thereof. Rand J. The bankrupt was a general contractor who entered R into an engagement with the appellant in the following terms:

Le soussign6 s'engage A faire le lambrissage de la s~rie de maisons de St-Pascal pour le compte de monsieur Rousseau.

La brique sera fournie par le contracteur g~ndral, monsieur Rousseau, ainsi que les clous.

La brique devra 6tre d6pos~e pris des maisons.

Le papier devra 6tre pos6 d'avance pour ne pas retarder les briquetiers.

Le mortier, les 6chafaudages seront fournis par le briquetier pour la somme de (cent quatre-vingt dollars) $180.00 pour les petites et deux cent cinq dollars) $205.00 pour les plus grandes.

(This is in error as to the mortar: it was supplied by Rousseau.)

Le contracteur monsieur Rousseau devra donner un estim6 de A toutes les semaines.

Greater details of the work to be done were set forth in an exhibit to the proof of claim:

(a) L'ouvrage en 'brique A la maison de Yvon Lepage, situde prbs du Chemin Ste-Foye, A Qubbec, oil j'ai pos6 de la brique h raison de $22.00 du mille, pour une somme globale de 607.20; (b) L'ouvrage en brique A une maison situde sur la rue Vitr6, et construite sur le lot 114, pour lequel il m'est une somme de $182.00;

(c) L'ouvrage en brique A une maison situde sur la rue Vitr6, lot 115, pour lequel il m'est dfi un montant de $207.00;

(d) La construction d'une cheminde A une maison vendue A un monsieur Marcoux, pour laquelle il m'est dfi un montant de $22.00, soit une somme globale de $1,018.20;

Cette somme de Q1,018.20 repr6sentant la r~mundration comme briqueteur-magon, le failli m'ayant garanti un montant de $200.00 pour la premibre maison de la rue Vitr6 et $207.00 pour la seconde. The appellant holds himself out, as his business letterhead indicates, as an entrepreneur, although he is also a working mason. The work done is seen to have been the labour for the brick work including the scaffolding for four houses under construction by the bankrupt.

It was actually performed by the appellant assisted by three or four helpers.

They were his employees exclusively and were paid in full by him; his claim includes their wages earned on the work and the balance represents the work done by him personally and the overall profit. There is nothing to indicate that his personal labour was at all bargained for: the entire work could have been done by others.

--- Mr. Hudon assimilated the case to that of a mechanic's lien with subrogation to the appellant of claims which his employees might have asserted; but this conception disregards the plain language of the statute. The claim, in order to obtain a priority, must be by "a workman" in respect of "services rendered to the bankrupt." "Services rendered" must be distinguished from work or labour furnished; and the enumeration of the persons shows the class and the nature of the service intended to be benefited.

The appellant in form and substance is a sub-contractor, and the logical conclusion of the contention made for him is that for the purposes of section 121 there cannot be a sub-contract for labour only. With that I am unable to agree.

Mr. Hudon relied on Ex. parte Hollyoak; In re. Field, (1). But that was a case of group production by persons dismissible by the bankrupt who divided total earnings between them, but who chose one of their number to represent them for all purposes vis A vis the employer. The representative was, in effect, treated as a trustee for the others. But the direct relations between the individual members of the group and the employer and between them and their representative distinguish the facts from those here.

I think the judgment below is sound, and would dismiss the appeal with costs.

Appeal dismissed with costs.