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Difference between revisions of "Creditors' Remedies against Debtors (10:III)"
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Creditors' Remedies against Debtors (10:III) (view source)
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If a client’s car has been seized, check with the Registrar-General to determine whether the acknowledgement of indebtedness was properly included, and whether the automobile, etc. was seized before the end of the limitation period: see ''Rudd’s Heavy Equipment Repairs Ltd v Blackstone Paving Ltd'' (1985), 34 ACWS (2d). | If a client’s car has been seized, check with the Registrar-General to determine whether the acknowledgement of indebtedness was properly included, and whether the automobile, etc. was seized before the end of the limitation period: see ''Rudd’s Heavy Equipment Repairs Ltd v Blackstone Paving Ltd'' (1985), 34 ACWS (2d). | ||
=== 3. Buyer’s Lien === | |||
When a buyer has made a partial or full payment to a seller - and the goods are unascertained or future consumer goods, the buyer can place a lien against all goods that are in, or will come into, the possession of the seller that correspond with the description or sample of goods agreed upon (See Part 9 of the ''Sale of Goods Act''). This holds as long as the goods were not sold to someone else. The buyer also has a lien against any bank account where the seller normally deposits the proceeds of sales. This lien has priority over all other security interests, but generally is not valid in bankruptcy. However, if the seller has maintained records or documents that clearly identify the goods for which a deposit was paid, the buyer may be entitled to the lien. Where the seller maintains a separate trust account, the buyer can file a property claim for the trust funds which is in priority to other security interests. See ''In the Bankruptcy of Ian Gregory Thow'', 2006 BCSC, 1414 and ''In the Matter of the Bankruptcy of Anderson's Engineering Ltd.'' 2001 BCSC 1476. | |||
The seller can discharge the lien by handing over the good or returning the buyer’s deposit, but the latter will not relieve the seller from the possibility of suit for breach of contract. The buyer’s lien permits the buyer, upon application to court, to have goods seized and sold and have the proceeds delivered, or just have the goods delivered. | |||
=== 4. Liens for Storage === | |||
The ''Warehouse Lien Act'' provides that every warehouse owner or operator has a lien on goods deposited with him or her for storage, whether deposited by the owner of goods or by their authority, or by any person entrusted with possession of the goods by the owner, or by their authority (s 2(1)). This right does not apply to unpaid charges for goods previously stored: see ''Re Dutton Pacific Forest Products Ltd.'' (1980), 117 DLR (3d) 507 (SC), sub nom ''Squamish Terminals Ltd. v Price-Waterhouse Limited''. After the warehouser gives the appropriate notices, the goods may be sold to collect the charges (ss 3 and 4). | |||
=== 5. Legal Advice on Liens === | |||
If the lien is valid and the client wishes to discharge the lien, but disputes the amount of the claim, the client may wish to make the payment to the lien-holder. The client should send an accompanying letter stating an intention to dispute the claim, and if they are required to sign documents acknowledging indebtedness before the chattels will be released, they should write the words “Without Prejudice” above the signature. In every case, the client should always ensure that the proper steps have been taken to discharge the lien upon payment. | |||