Hectors Ltd. v. Manufacturers Life Insurance Co.

and CITY

Jan. 24 INVESTMENT CORPORATION

RESPONDENTS. LTD. .....

.............

ON APPEAL FROM THE SUPREME COURT OF ALBERTA, APPELLATE DIVISION

J.:-The problem involved in this appeal is whether in a case where there is a contract to supply certain material for a fixed price, the subsequent supply of material outside the contract will keep a mechanic's lien alive. Milvain J. decided that it would not. His judgment was affirmed by the Court of Appeal' with McDermid J.A. dissenting. In my opinion, the judgment of the Appellate Division should be affirmed.

By a quotation dated January 23, 1964, Hectors Limited, the appellant in this Court, offered to supply Willmar Construction with 8,500 square feet of welded wire mesh (approximately 120 tons) for $24,821. This offer was accepted in writing on February 3, 1964. From time to time these materials were delivered under this contract as the builder required them, and there is a finding of fact that the last materials supplied under this contract were delivered in June 1964. No lien was filed until November 1964. If there had been no other dealings between the parties, the filing of the lien was clearly out of time, for the statute requires it be filed "within thirty-five days after the last of the materials is furnished".

However, from time to time the builder telephoned individual orders for special material-pre-fabricated lintel angles. These lintel angles had nothing to do with the original quotation for the supplying of welded wire mesh. They cannot be regarded as extras to that contract. They were supplied as the telephone orders were received. The last of these orders was filled on October 14, 1964 and the lien was filed on November 16, 1964 for a claim which included the balance owing on the original contract together with whatever was owing for the lintel angles. If the supply of lintel angles kept the lien alive, then the claim, being filed within a period of thirty-five days from October 14, 1964, was in time. This is the submission of the appellant, Hectors Limited, and it is this submission that has been ruled against both at trial and on appeal.

The Appellate Division founded its judgment on the general principles stated in Whitlock v. Loney', a decision of the Supreme Court of Saskatchewan en banc. These general principles are stated in 13 C.E.D. (Ont. 2nd), p. 347, as follows:

The Supreme Court of Saskatchewan in the Whitlock case found that the facts proved what has been referred to as a prevenient arrangement or a continuing or entire contract. For that reason they upheld the lien. But they recognized that in a situation such as we find here, and which the Alberta Courts have expressly found to exist. a lien claimant cannot tack on the subsequent supply of materials outside the contract and thus keep the lien alive.

There are decisions to the same effect, both before and after the Whitlock case, in the Ontario Court of Appeal -Rathbone v. Michael ; and Fulton Hardware Co. v. Mitchell'.

In Rathbone v. Michael there was a contract to furnish certain specified materials for the sum of $1,700. The last delivery under this contract was September 16, 1908. Further material was supplied between August 1 and October 8, 1908, on separate orders from time to time. A divisional Court first found that this further material was outside the contract and that the time of delivery of material outside the contract did not extend the time for filing the lien to include a claim under the original contract. On an application to adduce further evidence before the same Court, it was found that the additional material had been improperly charged as an extra outside the original contract and that it should have been charged under and as part of the original contract. The lien was, therefore, V* upheld. This admission of new evidence and the affirmance of the lien was upheld on an appeal to the Court of Ap- LWE peal; see: Rathbone v. Michael'. The underlying assump- Co. tion of all the judgments is that if the materials had not Judson J. been supplied as part of the contract, the filing of the lien would have been out of time.

Fulton Hardware Co. v. Mitchell, supra, is to the same effect. Here there were two contracts, one for a roof for $3,806, and another for a skylight. There were also materials supplied not connected with either of these contracts. The point in issue is stated in the judgment of Meredith C.J.O. at p. 473:

It is contended on the appellant's behalf that, inasmuch as all the work done and materials supplied for purposes of the two contracts, as well as the materials supplied for purposes outside the two contracts, were charged for in one running account, and work was done on the roof contract within the 30 days, the lien for the materials is saved.

Meredith C.J.O. approved the principles enunciated in Whitlock v. Loney. The judgment of the Court is contained in the following paragraph from p. 474:

There is nothing in the evidence to indicate that all the work which was done and all the materials that were supplied were done and furnished under one continuing contract; but on the contrary, the work done and the materials supplied for the roof contract were furnished under a separate contract from that as to the skylight and that as to the materials. What was supplied under the last mentioned contract would, no doubt, come within the principle relied on by the appellant, and it is to such a contract that the language of Riddell, J., in Hurst v. Morris (1914), 32 O.L.R. 346, at p. 351, must have had reference.

Thus it becomes wholly immaterial whether the material is furnished under one contract or under fifty, and it will be seen that this is 1 (1910), 20 O.L.R. 503.

(1914), 32 O.L.R. 346. (1929),

64 O.L.R. 94.

R.C.S.