SNOWDON, and HOWARD COOK, carrying on busi- *May 25,26 ness under the firm name and style of MILLICAN, SNOWDON & COOK and the said MILLICAN, SNOW- Jan.24 AND
TIFFIN HOLDINGS LTD. (Plaintiff) ...
. RESPONDENT. ON APPEAL FROM THE SUPREME COURT OF ALBERTA, APPELLATE DIVISION
Solicitors-Professional negligence-Solicitor retained by lender in preparation and registration of chattel mortgage on certain equipment as security for loan-Later discovery that equipment not at reported location and probably not owned by borrower-Whether solicitor negligent in failing to anticipate borrower's criminal conduct. On Thursday, July 17, 1958, the appellant S, a partner in the appellant firm of solicitors at Calgary, was asked to represent the respondent in the preparation of a chattel mortgage on some industrial equipment as security for a loan of $13,000 to be made by the respondent to one A. The latter in describing the equipment gave a serial number which S, on making inquiry, discovered could not be the proper number. T, who controlled and was the president of the respondent, was advised by S to make a personal inspection of the equipment but he said that he did not have time. He intimated to S that the matter was urgent, as A required the funds promptly in order to accept an option. A told S that the location of the equipment was at Hinton, Alberta. This would necessitate registration of the chattel mortgage in Edmonton. He also gave the name of the company which he said was using the equipment. S telephoned to his agents in Edmonton, giving the information which he had obtained and asking them to check it. At a further meeting the next day A furnished what he alleged was the correct serial number of the equipment. S was advised by a finance company that they had financed equipment for A in the past of the kind described by him. This information was confirmed in writing by the company on Monday, July The confirmation gave the serial number of the equipment and stated that a lien of $22,000 had been satisfactorily retired by the debtor.
On the Friday, the chattel mortgage was drawn and executed and was forwarded to S's agents at Edmonton for registration with a letter asking that it be ascertained that there was no prior encumbrance against it. T delivered to S the respondent's cheque for $13,000 payable to the appellant firm. S was instructed to deposit with the bank on which it was drawn a letter confirming the registration of the chattel mortgage in order to have it certified.
The chattel mortgage was registered on Monday, July 21, and, after certification of the respondent's cheque, S delivered to A the appellant firm's cheque for $13,000. At the time he had received the written confirmation of the finance company. On the same day, in the late afternoon and subsequent to delivery of the cheque, S received a Abbott, Martland, Judson, Ritchie and Hall JJ.
S.C.R.