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APPELLANT; *Oct. *Nov. WILLARD S. JEFFREY
(DEFEND- RESPONDENT. ANT). ............................
R
APPEAL FROM THE APPELLATE DIVISION OF THE SUPREME OF ALBERTA.
Per Duff J.-As the equitable relief sought could granted upon a consideration of the circumstances and no claim therefor was made in the courts below.nor was the evidence directed to any such claim, the claim came too late an appeal to the Supreme Court of Canada.
Per Fitzpatrick C.J. and Tdington J.. dissenting.-As the conduct. of the owner respecting the order was equivocal and misleading and induced the materialman to abstain from filing lien to Fitzpatrick C.T.
Anglin and Brodeur JJ.
sion of the Supreme Court of Alberta(1), reversing the judgment of Ives J., at the trial, and dismissing the plaintiff's action with costs.
The circumstances of the ease appear from the head-note.
La-fleur K.C. for the appellant.
Gerald V. Pelton for the respondent.
(dissenting).-I am satisfied on the evidence that the appellant failed to file a lien under the Act because of the defendant'.s promise to pay Horn's order. J. W. Ritchie, when examined as a witness, says that he did not file a lien because he trusted Mr. Jeffrey would pay the order given by Mr. Horn and again on his re-examination he testifies as follows:- And again
The same witness also says that he accomplished the shipment of lumber on that understanding. If the appellant had filed his lien he, as material man, under the Act would have been entitled to precedence over IHaugen, the sub-contractor, who was subsequently paid $558.10.
To say the least, Jeffrey's coniduct at the time Horn's order in favour of appellant was presented to him was shifty and ambiguous, and if in the result lie led the appellant into error and induced him by his conduct and representations not to file a lien, he should be held liable.
I would allow the appeal with costs.
J.. (dissenting).-The only of amy diflieulty in this appeal is whether or not the order upon respondent for $800 by Horn, a contractor, engaged in building for him a shop for which, when completed, Horn was to be paid $3,000, can, with the attendant facts and circumstances, be held as furnishing sufficient evidence to maintain the appellant's claim of an equitable assignment of part of the said $3,000.
The shop was being erected in Jasper Park. The appellant furnished lumber therefor to an amount greater than $800, as respondent well knew. Horn, in order to give security to appellant therefor to the amount of $800, gave the following order:- This order is not as unambiguously worded as was that in question in the case of Brice v. Bannister (1) 3
In that case the order expressly said it was to be "paid out of moneys due or to become due from you to me," and thus within its very terms fulfilled the Idington J. exact requirements of an equitable assignment. -- But we must bear in mind that it is not necessary that such an equitable assignment as in question need to be reduced to writing.
The language of Mr. Justice Ohitty in the case of Brown, Shipley d Co. v. Kough(1), as quoted by Mr. Justice-Beck herein, so accurately defines what is required that I think we may accept it, coupled with what Lord Macnaghten said in the case of Tailby v. The Official Receiver(2), in 1888, as our guide herein. The quotation I refer to in the former case is as follows:- An agreement to pay out of the fund is a good equitable charge. It matters not whether it (the agreement) be to pay an existing debt or a sum of money advanced at the time or whether it (the money to paid) (the amount a bill exchange; but it must shewn on the part of those who assert an equitable charge that they have obtained it (the charge) agreement. The agreement may shewn producing a written document which is clear, or the agreement may be fairly derived from the course of dealing, and, where there is a contest as to an oral agreement, the court must decide whether there is such an oral agreement or not and the plaintiffs have to make out in this case one or other the things I have mentioned before they can succeed in establishing an agreement amounting to an equitable charge or an equitable assignment part the fund.
agreement may shewn the terms which the parties came to with reference to the supposed course dealing and derived also from the course of dealing itself relating to transactions that have been entered into or transactions which it proposed should entered into, or it may be shewn the special terms agreed to at the time when the transaction takes place. To apply the law as laid down by Mr. James Ohitty in this extract we need not go further than consider Cas. 523. the course of dealing between the parties. That alone has not been relied upon herein for we have an order and the course of dealing illumtinating, as other considerations ai about to advert to, the meaning to given the order.
It is beyond dispute that the respondent was building a shop in Jasper Park which was being built by I-Torn, who gives the order; that the appellant had delivered and shipped to Jasper Park material for said building far exceeding in value the aiount of the order; that the miaterial so shipped and delivered was at the date of the order being used and ultimately was all used to the knowledge of the respondent by Horn for the purposes of the construction of said building; that respondent knew and recognized such facts and his consequent benefit therefrom and liability upon his contract as the basis upon which Horn proceeded in giving the order; that the "Mechanics' Lien Act" gave him supplying such material to the contractor for such purpose a lien upon the material till used, and upon the building itself when used in the construction thereof, and that in priority to all other liens-unless possibly wage-earners for their labour-and that the parties thereto were entire strangers to each other yet the respondent had no difficulty in understanding the order was given, and no difficulty in recognizing that it was intended and expected to be paid out of the fund Which consisted of the contract price. The order should be read, if anibiguous, in light the surrounding facts and circumstances.
So read and illuminated thereby, can there be a doubt as to what the order meant and that it (lid mean that it was to he paid out of the fund in respondent's hands to pay for said building and to be a charge thereon and that the fund was to be administered according to the legal rights of the parties concerned in its distribu- Idington J. tion and that respondent was entitled to discharge pro tanto his obligation to Horn by payment of said order ?
I think not.
To put beyond doubt the knowledge of 'the respondent I may refer to the following from his own evidence:- Q. Correct. I know, but the order which was presented to you was an order for the payment a certain sum money in connection with the sum account of material delivered and shipped to Jasper Park ?
Yes, that is what the order was for I suppose.
You knew that they were expecting payi.nent from you of the amount that order ?
I don't know hardly how to answer that; I presume Mr. Horn had told them that I would pay it without any question. Q. And you also certainly them to understand that it would paid ?
I told them that it would paid after the building was done if it was coming to Mr. Horn.
Did you always put in that "If it was coming to Mr. Horn" I think so, as near as -I can remember.
Q. Beg pardon ?
I think so.
The Court: What I don't understand is why your dealing Mr. Ritchie should the only creditor to have to wait or lose if any one was to lose and you pay everybody else ?
Well, Mr. Horn agreed to furnish all these materials. But you knew they were coming from Ritchie ?
I supposed they were, yes; Mr. Horn said he was getting from them; I don't know where the cement and the- Mr. Grant: You knew that Mr. Ritchie did expect to get the I know they wanted it from me; they asked me; there four occasions when they came to me for it.
Q. Now will you answer my question.
You knew that Mr. Ritchie expected to get the from ?
Why, I suppose he did.
There is much more needless to quote on the same uns point.
He hedges about paying it by saying he told appellant's agent if that much were coming to Horn when lie had completed his contract, he would pay it. As he was under no liability to pay a single dollar till the time had arrived, I cannot see how that helps hii.
If lie had paid no one else till then there woulld have been no trouble.
If labourers had gone unpaid and, what was.highly improbiable, their uipaid wages had eaten up the fund in liens therefor the appellant might have been left unpaid.
No such thing happened.
A sub-contractor named Ilaugen got far more than required to pay this appellant.
In short, he whose claim was in law and equity subject to be postponed to the claims of the material-men was paid. Respondent quibbles about this being for lahour, pretends that at first and later on shews at least as to one item of $500 alone it was for a sub-contract.
The learned trial judge had no difficulty once he arrived at the conclusion that appellant had an equitable assignment then respondent was bound to answer for the whole amount of the order.
And the position taken in the court of appeal proceeds entirely upon the ground that there was no equitable assignment-and indeed only a bill of exchange.
For the reasons already indicated I most respectfully say I cannot accept that view.
It is quite true there is a decision (Shand v. Du BJuisson (1) ) that mere bill of exchange, evidently intended as such, is not of itself an equitable assignment, and another that a cheque on a banker cannot be so held.
The parties concerned herein never sup- J. posed they were dealing with either such thing, but something different.
What we have to pronounce upon herein is not that simple character in form or intention when we try to understand what the parties were about. The case of Percival Dunm(1), relied upon below, is clearly distinguishable, for the order was not even addressed to the party who had to pay and was not accompanied, so far as appears, by any attendant circumstances that helped to explain or form an independent arrangement.
The argument presented by counsel here endeavoured to shew that the court in Brice v. Bannister (2) was divided, but it has ever since stood as good law and been, I venture to think, extended in principle as the equitable doctrine became more familiar to the profession than it was when Brice v. Bannister (2) was decided, shortly after the "Judicature Act." The case of William Brandt's Co. Dunlop Ptbbcr Co.(3), though not exactly covering this case, shews how in recent times the court is disposed to treat such claims as rest upon the doctrine relative to equitable assignment.
I agree with the court of 'appeal that the bargaining between the respondent and.the agent of appellant standing alone has little to do with the matter, yet that does not do away with the knowledge the respondent had of the plain purpose of the order -to have it paid out of the fund in existence or to come into !15 existence.
I think the appeal should he allowed with costs here and below.
J. DI-,F .1.-I have no doubt that the order in question was a good and effective equitable assignment of the fund over which the contractor should ultimately prove to have the power of disposition as between himself and the respondent. To give the appellant the right he now claims, the equitable assignment must be supplemented by soiiething additio-nal, that is by some act or acts of the respondent himself raising a right against him; such, for example, a promise founded upon legal consideration or conduct precluding the respondent from disputing the existence of an equitable charge for the amount claimed.
For such equitable relief no claim was made in the courts below and as such relief could only be granted as the result of an examination of the circunstances as a whole-which it cannot be said the (idence places before us-it is too late now to con- Sider it.
As to promise-the finding at the trial is against it. On the whole I am constrained to the conclusion that the appeal should be dismissed with costs. J.-Except in so far as he questioned the sufficiency of the order given by Horn to the plaintiff as, under the circumstances, a good equitable assignment, I am in accord with the views expressed by Mr. Justice Beck in delivering the judgment of the Appellate Division. There is nothing in the record which warrants extending the fund upon which that assignment should operate beyond moneys in the defendant's hands over which Horn had the right of disposition. The evidence does not warrant a finding of a promise by the defendant to pay upon the order in question J more than this amount-and there has been no such finding. Neither does it establish a representation that the fund to which the order attached would be sufficient to meet it, or would amount to any specific sun.
It may be that the plaintiff in refraining from registering a mechanic's lien relied ,upon his equitable assignment and the defendant's acceptance of it, but it has not been shewn that the defendant said did anything which would warrant an inference by the plaintiff that he had relinquished in his favour his undoubted right to make out of the moneys payable to his contractor such payments as might be necessary to protect his property from liens and to ensure the completion of the building contract and to deduct payments so made from the moneys which would otherwise be payable to the contractor.
The plaintiff has failed to make out a case either of a promise to. pay the amount of his order or of an equitable estoppel precluding the defendant from denying the sufficiency of the fund in his hands to meet it.
I would, for these reasons, dismiss this appeal with costs.
J.-The defendant Jeffrey was ereeting a building and a man named Horn had a contract in connection with that construction. Horn, having purchased materials from the plaintiff Ritchie, gave, on the 27th Januatry, 1914, the following order:- At the time this order was given and was notified to the respondent no money was due upon the Horn con tract by Jeffrey. Horn seems to have been unable to carry out his contract and the proprietor had to . pay money to third parties to finish the building. He had to pay some wages of labourers and when the building was finally completed $296.99 remained due to Horn, which he deposited in court for the plaintiff Ritchie.
It is clear from the evidence that the respondent .Teffrev never undertook to pay the f till amount of the order.
Ie was willing, however, out of the amount which would ultimately remain owing to Horn on the completion of the contract, to pay that amount to the plaintiff.
It would have appeared ridiculous that he would have formally agreed to give an absolute and unconditional promise to pay when he did not know whether Horn would carry out his contract and when some liens could have been registered by wageearners or others.
The trial judge held that this order constituted an equitable assignment; but it is necessary, in order to constitute such an assignment, that the fund should be specified (Percival v. Dunn (1) ); and, besides, this order was valid subject to any claim under the contract which would have been good against the assignor. For these reasons the appeal should be dismissed with costs.
Appeal dimissed with costs.