Merchants Bank of Canada v. McLachlan / Merchants Bank of Canada v. McLaren

given a true answer if he had said that the ship was built in 1868.

It was not all new; old materials were certainly used, but she was nevertheless built, and

"I1 came to life as " The Clansman " in 1890.

I adopt the reasoning of Ritchie, Graham and Meagher JJ. in the court below.

MERCHANTS BANK OF CANADA v. McLACHLAN.

MERCHANTS BANK OF CANADA v. McLAREN.*Oct.10,11. APPEALS from the decisions of the Court of Queen's

Bench for Lower Canada (Q. R. Q. B. 431) reversing the judgments of the Superior Court which had maintained the contestations of the respondent's claims in each action.

On the 10th April, 1886, John McLachlan, a retired partner from the firm of McLachlan & Bros., composed of the said John S. McLachlan and William

McLachlan, his brother, agreed to leave his capital, for which he was to be paid interest, in a new firm to be constituted by the said William McLachlan and one

William Radford, an employee of the former firm, and that such capital should rank after the creditors of the old firm had been paid in full. The new firm undertook to carry on business under the same firms up to 31st December, 1889. John S. McLachlan died on the 18th November, 1886.

Mrs. Annie Mc- Laren, the wife, separate as to property of John Mc- McLACHLALachlan, had an account in the books of both firms. the 16th April, 1890, an agreement was entered into between the new firm of McLachlan Bros. and the estate of John S. McLachlan and Mrs. McLachlan, by which a large balance was admitted to be due by them to the estate of John McLachlan and to Mrs. John McLachlan.

The new firm was declared insolvent in

January,

Claims having been filed respectively by Mrs. John McLachlan and the executors of the estate of John McLachlan against the insolvent firm, the Merchants Bank of Canada contested the claims on the following grounds, inter alia : 1st, that they had been creditors of the firm and continued to advance to the new firm on the faith of the agreement of April, 1886 ; 2nd, that Mrs. John S. Mc- Lachlan's moneys formed part of John McLachlan's capital, and 3rd, that the dissolution was simulated. (See also report Q. R. Q. B. 431).

The Supreme Court reversed the judgment of the Court of Queen's Bench for Lower Canada (appeal side) restoring the judgment of the Superior Court, Fournier and King, JJ., dissenting, and held, that the dissolution of the partnership was simulated ; that the moneys which appeared to be owing to Mrs. John McLachlan after having credited her with her own separate moneys were in reality moneys deposited by her husband, in order to confer upon her during marriage, benefits contrary to law, and that the bank had a sufficient interest to contest these claims, the transaction being in fraud of their rights as creditors. Appeals dismissed with costs. Laflamme Q.C. and Greenshields Q. for the appellants. Hall Q.C. and Geoffrion Q.C., for the respondent. - S. " SANTANDARINO " v. " VANVERT." APPEAL from a decision of the local judge in Ad- .miralty for the District of Nova Scotia, (1) finding the Santandarino to blame for a collision with respondent's ship.

In an action against the owners of the " Santandarino" for damages incurred by a collision with the respondent's barque, the " Juno," through the breaking down of the steering apparatus, the local judge in Admiralty, who was assisted on the trial by a nautical assessor, found that the steering gear was constructed on an approved patent and was in good order when the " Santandarino " started on her voyage but that the collision was due to want of prompt action by the master and officers when the wheel refused to work.

On appeal from that decision the Supreme Court held, Sedgewick and King JJ. dissenting, that only a question of fact was involved and though it was doubtful if the evidence was sufficient to warrant the finding the decision was not so clearly wrong as to justify an appellate court in reversing it.

Edward Mack died in 1871, and his brother and partner, Henry Mack, obtained from his widow and his father, as next of kin, a release of their respective interests in all real and personal property of the deceased. In getting this release he represented that the estate would be sacrificed if sold at auction, and the most could be made of it by letting him have full control of the property. He then took out letters of administration to Edward Mack's estate, but took no further proceedings in the Probate Court and managed the property as his own until he died in 1888. During that time he wrote several letters to the widow of Edward Mack, in most of which he stated that he was dealing with the property for her benefit, and would see that she lost nothing by giving him control of it. After his death the widow brought an action against his executors, asking for an account of the partnership between her husband and Henry Mack, and his dealings with the property since her husband's death and payment of her share; she also asked to have the release set aside. The defendants relied the release as valid, and also pleaded that plaintiff by delay in pressing her claims was precluded from maintaining her action.

The Supreme Court held, Gwynne J. dissenting, that the release should be set aside; that it was given in ignorance of the state of the partnership business and Edward Mack's affairs, and the plaintiff was dominated by the stronger will of Henry Mack ; that the latter had divested himself of his legal title by admitting in his letters a liability to the plaintiff, and must be treated as a trustee ; that as a trustee lapse of time would not bar plaintiff from proceeding against him for breach of trust; and that the delay in pressing plaintiffs claim was due to Henry Mack himself, who postponed from time to time the giving of a statement of the business wh'en demanded by the plaintiff.

ARCHIBALD v. THE QUEEN.

APPEAL'from a decision of the Exchequer Court refusing compensation to the suppliant for injury to his property by the construction of a public work. The suppliant owns a saw-mill in Cape Breton, and claims that he was prevented from rafting his lumber to a shipping point as formerly by the construction of a bridge across a pond some distance from the mill, in connection with the building of the Cape Breton Railway. The Exchequer Court held that the right alleged to be interfered with was a right common to the public, and that an individual affected by the interference was not entitled to compensation.

The Supreme Court dismissed with costs an appeal from this decision.

:-Sir