Ames-Holden Co. v. Hatfield, (1898) 29 SCR 95

Supreme Court of Canada

Ames-Holden Co. v. Hatfield, (1898) 29 S.C.R. 95

Date: 1898-10-02

Ames-Holden Company and others (Defendants) Appellants;

and

Thomas A. Hatfield (Plaintiff) Respondent.

1898: October 2.

PRESENT:—Taschereau, Gwynne, Sedgewick, King and Girouard JJ.

ON APPEAL FROM THE SUPREME COURT OF THE NORTH-WEST TERRITORIES.

Contract—Agreement to supply goods—Properly in goods supplied—Execution—Seizure.

By an agreement between H., of the one part, and W. and wife of the other, the latter were to provide and furnish a store and H. to supply stock and replenish same when necessary; W. was to devote his whole time to the business; W. and wife were to make monthly returns of sales and cash balances, quarterly returns of stock, etc., on hand and to remit weekly proceeds of sales with certain deductions. H. had a right at any time to examine the books and have an account of the stock, etc.; the net profits were to be shared between the parties; the agreement could be determined at any time by H. or by W. and wife on a month's notice.

Held, that the goods supplied by H. under this agreement as the stock of the business were not sold to W. and wife but remained the property of H. until sold in the ordinary course; such goods, therefore, were not liable to seizure under execution against H. at the suit of a creditor.

APPEAL from a decision of the Supreme Court of the North-west Territories affirming the judgment of Rouleau J. on the trial of an interpleader issue.

The only question in this case is as to the title to goods supplied by Hatfield, the plaintiff, to one West, a merchant at Innisfail, in the district of Alberta, which agreement was as follows:

“An agreement made between Thomas A. Hatfield, of the City of Calgary, in the district of Alberta, in

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the North-west Territories of the Dominion of Canada, general merchant, of the one part, and G. W. West, of Innisfail, in the said district of Alberta, merchant, and Mary Jane, wife of the said G. W. "West, of the other part, whereby it is agreed as follows:

"1. The said G. W. West and Mary Jane, his wife, will during the continuance of these presents provide and furnish free of rent and taxes a store at Innisfail aforesaid suitable for carrying on the business of a general merchant.

"2. The said Thomas A. Hatfield will supply to the said Gr. W. West and Mary Jane, his wife, at Innisfail aforesaid, all such goods and stock in trade as are usually necessary and required in the trade or business of a general merchant, and replenish such stock in trade from time to time as occasion may require, and the said Thomas A. Hatfield deem expedient.

"3. The said G. W. West shall, except when prevented by sickness, devote the whole of his time and attention to carrying on the trade or business of a general merchant at Innisfail, aforesaid, and diligently employ himself therein and promote to the utmost of his powers the benefit and advantage of the same.

"4. The said G. W. West and Mary Jane, his wife, shall make a report to the said Thomas A. Hatfield of the sales made and the cash balances once in each and every month during the continuance of this agreement, and shall render unto the said Thomas A. Hatfield a general account of the stock in trade, credits, property and effects, debts and liabilities of the said business once every three months.

"5. The said G. W. West and Mary Jane, his wife, shall remit to the said Thomas A. Hatfield, at Calgary, all monies received by them from sales in the course of the business as aforesaid, such remittances to be made on Tuesday and Friday in each and every week

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deducting freight charges and such amounts as may have been paid out in cash for local merchandise and farm produce.

"6. The said Thomas A. Hatfield may from time to time and at all times visit the said store at Innisfail and examine all and any of the books of accounts kept by the said G. W. West and Mary Jane, his wife, and take an account of the stock in trade, credits, property and effects, debts and liabilities of the business, and the said G. W. West and Mary Jane, his wife, shall whenever called upon give to the said Thomas A. Hatfield full explanations with regard to any matters concerning the said business as aforesaid.

"7. Proper books of account shall be kept by the said G. W. West and Mary Jane, his wife, and entries immediately made therein of all receipts and payments made and all such other matters and things as are usually entered in similar books of account.

"8. The net profits of the said business after deducting all freight charges shall be shared in equal proportions between the said Thomas A. Hatfield and G. W. West.

"9. This agreement may be determined at any time by Thomas A. Hatfield.

"10. If the said G. W. West and Mary Jane, his wife, wish to terminate this agreement they shall give to the said Thomas A. Hatfield one month's written notice of their desire so to do."

Several creditors of West, having obtained judgments against him, executions were issued and the goods supplied by Hatfield under the agreement were seized by the sheriff. Hatfield obtained an interpleader order, and an interpleader issue was tried resulting in his favour. The execution creditors then brought this appeal.

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Latchford and McDougall for the the appellants. The agreement is inconsistent with West being a manager for, or partner wilh Hatfield. Ex parte White: In re Nevill ([i]).

The business was carried on in the name of West, and those dealing with him had, and could have, no knowledge of Hatfield being interested.

Knott for the respondent was not called upon.

The judgment of the court was delivered by:

GWYNNE J.—At the time when the agreement which is the subject of consideration in this case was entered into, there were executions in the sheriffs hands against the goods and chattels of "West, one of the parties to the agreement, so that if the contention of the appellants should prevail, then eo instanti that the goods of Hatfield came into the possession of "West and his wife, they became "West's property under the agreement, and would be liable to the executions in the sheriff's hands. Now it is, I think, apparent upon the terms of the agreement, although I admit that this might have been more perfectly expressed, that the intention of Hatfield was to make impossible such a result. The parties never contemplated a sale of the goods by Hatfield to "West, or to him and his wife. There is nothing in the agreement warranting such a construction There is no provision that West and his wife, or West, shall pay anything to Hatfield as the price of the goods to be placed in the possession of West and his wife under the agreement; in fact the construction of the agreement appears to me to be that Mrs. West should supply the shop where the goods should be sold; that she and her husband, acting as agents of Hatfield, should weekly render a statement

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of the amount of sales made by them of Hatfield's goods, less certain allowed charges, and that West and his wife, for all their services rendered to Hatfield, should receive nothing whatever but one-half of the net profits arising from the business, and that Hatfield should have the right of determining that agreement at his pleasure at any moment.

Upon such a contract it is impossible for us to hold that the goods placed by Hatfield in the hands of West and his wife, or of West, under the agreement, became the property of West, and therefore liable to the executions in the sheriff's hands against his goods, or that Hatfield ever lost his property in the goods, except as to the goods sold by West and his wife, under the agreement, as to which there is no question here.

The appeal must be dismissed with costs.

Appeal dismissed with costs.

Solicitors for the appellants: McCarthy & Stuart.

Solicitors for the respondent: Crispin E. Smith.