The
Associate
Chief
Justice:—This
action
came
on
for
trial
at
Yorkton,
Saskatchewan,
on
October
4,
1983.
At
issue
is
the
allegation
by
the
plaintiffs
that
certain
funds
seized
by
the
defendant
from
Armstrong
The
Mover
(Saskatchewan)
Ltd
were
not
the
property
of
that
company
but
were
in
fact
held
in
trust
for
the
plaintiffs
and
therefore
not
subject
to
seizure
by
the
Crown.
During
1980,
the
plaintiff
Keith
Vaughan,
agreed
orally
with
Charles
Weeks
and
Walter
Wheeler,
the
principals
of
Armstong
The
Mover
(Yorkton)
Ltd,
to
buy
that
company
and
to
continue
to
use
its
membership
with
the
national
organization
Allied
Van
Lines
Ltd
(hereafter
AVL).
The
agreement
was
never
properly
executed
nor
was
the
purchase
price
paid,
but
Vaughan
took
possession
of
the
company
and
its
assets
and
began
to
operate
it
prior
to
September
1,
1980.
During
the
months
of
September,
October
and
November,
1980,
certain
work
was
performed
by
the
plaintiffs
within
the
AVL
affiliation
under
an
interim
verbal
agreement.
Payments
were
credited
to
the
Yorkton
branch
account
with
Armstrong
The
Mover
(Saskatchewan)
Ltd.
Before
any
transfer
of
any
moneys
had
taken
place
to
the
Yorkton
company,
the
defendant
in
accordance
with
the
provisions
of
the
Income
Tax
Act,
RSC
1952,
c
148
amended
by
SC
1970-71-72,
c
63,
seized
approximately
$9,000
on
account
of
debts
owing
to
Her
Majesty
The
Queen
by
Armstrong
The
Mover
(Yorkton)
Ltd.
The
onus,
of
course,
rests
upon
the
plaintiffs
to
persuade
me
that
these
funds
were
in
the
hands
of
Armstrong
The
Mover
(Saskatchewan)
Ltd
in
trust
for
these
plaintiffs
and
not
there
as
part
of
a
normal
commercial
trading
account.
Counsel
for
the
plaintiffs
delivered
a
very
persuasive
argument
on
the
conditions
necessary
for
the
establishment
of
a
trust,
and
referred
in
particular
to
the
case
of
Waselenko
and
Waselenko
v
Touche
Ross
Ltd,
et
al,
[1983]
2
WWR
352,
which
I
have
considered
quite
carefully.
In
the
circumstances,
however,
the
facts
simply
do
not
support
his
submissions.
There
is,
of
course,
no
specific
agreement
impressing
these
funds
with
the
character
of
a
trust.
If
one
is
to
be
established
therefore,
it
must
be
on
the
basis
of
a
constructive
trust
whereunder
the
Yorkton
company
would
be
unjustly
enriched
by
having
a
reduction
of
its
debts
with
the
Crown
take
place
with
funds
that
did
not
belong
to
it.
The
plaintiff,
Keith
Vaughan,
had
been
employed
as
the
manager
of
Armstrong
The
Mover
(Yorkton)
Ltd
when
he
was
approached
by
the
owners
to
consider
this
purchase.
His
evidence
confirms
that
it
was
his
understanding
that
Armstrong
The
Mover
(Yorkton)
Ltd
was
at
that
time
a
subsidiary
of
Armstrong
The
Mover
(Saskatchewan)
Ltd,
a
holding
company.
The
latter
company
was
his
employer
and
their
name
appeared
on
his
salary
cheques.
This
evidence
concerning
the
acquisition
of
assets
is
of
a
very
general
nature
but
certainly
confirms
that
some
were
owned
by
Armstrong
The
Mover
(Yorkton)
Ltd
and
some
appeared
to
be
owned
by
Armstrong
The
Mover
(Saskatchewan)
Ltd.
Armstrong
The
Mover
(Saskatchewan)
Ltd
was
also
the
holding
company
for
other
operating
subsidiaries
including
one
in
Moose
Jaw,
Saskatchewan,
and
some
evidence
was
led
concerning
benefits
enjoyed
by
the
plaintiffs
as
a
result
of
this
association
from
a
move
which
initiated
in
Yorkton
and
terminated
in
Moose
Jaw.
In
terms
of
the
association
within
AVL,
Armstrong
The
Mover
(Yorkton)
Ltd
was
in
some
peril
due
to
their
over-extended
position
at
the
bank
and
in
due
course,
the
Yorkton
membership
was
cancelled
and
the
plaintiffs
filed
a
fresh
application
for
membership
in
their
own
right.
In
the
period
at
issue,
however,
there
can
be
very
little
question
that
the
plaintiffs
could
not
have
operated
within
the
association
without
the
goodwill
of
both
the
Yorkton
branch
and
the
parent
Saskatchewan
company.
All
of
this
evidence
is
far
more
consistent
with
the
existence
of
a
normal
commercial
trading
account
between
all
of
these
companies
than
it
is
with
any
kind
of
trust,
expressed
or
implied.
When
I
add
to
this
the
fact
that
while
the
plaintiffs
became
the
owners
and
operators
of
the
company,
they
never
did
pay
the
$35,000
purchase
price,
it
is
inconceivable
to
me
that
either
Armstrong
The
Mover
(Saskatchewan)
Ltd
from
whom
these
funds
were
seized,
or
the
Yorkton
subsidiary,
would
not
have
some
claim
against
them,
however
small
or
indirect.
Any
such
claim
of
course,
negates
any
possibility
of
a
trust.
The
facts
here
are
simply
inconsistent
with
the
existence
of
a
trust
and
indeed
support
the
opposite
conclusion.
The
action
must
be
dismissed
with
costs.
Email this Content