Report on Commercial Liens 1994


I.  ARE THERE SOME LIENS CONSIDERED BY THE ALBERTA REPORT FOR WHICH UNIFORMITY CANNOT BE CONSIDERED ESSENTIAL SUCH THAT THEY SHOULD BE GOVERNED BY LOCAL OPTION ONLY?

The Alberta Report reviews the legislative history of the following types of personal property lien:

  • (a) garagekeeper's and mechanic's lien (linked together in the Alberta Report as "repairer's" lien);
  • (b) warehousekeeper's lien (called in the Alberta Report "storer's lien");
  • (c) common carrier's lien;
  • (d) hotelkeeper's lien;
  • (e) agister's lien;
  • (f) woodworker's lien;
  • (g) thresher's lien; and
  • (h) beet lien.

I will now describe each of these liens.

(a) Repairers' liens:

The repairer's lien exists now in two forms in most jurisdictions in Canada: (i) possessory liens for the improvement of chattels generally; and (ii) non-possessory liens for the repair of vehicles and airplanes. Most jurisdictions have a statute of the first type dealing generally with "liens for the improvement of chattels". In Saskatchewan this is the tag-end section of The Mechanics' Lien Act R.S.S. 1978, c.M-7, S.61. This lien requires the lienor to have and keep possession until sale. Similarly, in New Brunswick there exists an Act entitled the Liens on Goods and Chattels Act R.S.N.B. 1973, Chap. L-6, which is similar to Saskatchewan's Mechanics' Lien Act referred to above, but also provides a particular possessory lien for: (i) a wharfinger for his lawful charges "on the goods entrusted to his keeping"; and (ii) a gratuitous bailee of goods "on the goods for the reasonable charges for caring for them after the expiration of the time mentioned in a notice given by the bailee to the bailor to take possession of the goods". Other jurisdictions have similar statutes.

The second type of repairer's lien that exists in western Canada is the garagekeeper's lien which allows the repairer to give up possession of vehicles and airplanes and to subsequently register the lien in the Personal Property Registry within a prescribed time period. In Alberta, the Garagemen's Lien Act, R.S.A. 1980, c. G-1 extends to most farm equipment (see: ss. 1(a) & 2). In British Columbia, this lien also applies to boats and outboard motors (see: the Repairers Lien Act, R.S.B.C. 1979, c. 363, s. 3).

Ontario's Repairers' and Storers' Liens Act brought the "mechanic's lien" and the "garagekeeper's lien" together conceptually and dealt with them in the same statute. Before this Act, Ontario had the same provision Saskatchewan had in its mechanics' lien legislation, but did not have garagekeepers' lien legislation.

In Québec, a right of retention is given to the person who makes improvements or additions to moveable property. This right of retention is in fact an illustration of the right of accession in relation to moveable property. Article 974 of the Civil Code (proclaimed in force January 1, 1994) provides that "[t]he person bound to return the new thing [i.e., the thing so repaired] may retain it until its owner pays him the compensation he owes him." There is no right of sale or ability to release the property to the owner and still retain rights over the property.

(b) Storers' liens:

This encompasses the traditional warehousekeepers' lien and is expanded by the Alberta Report to include all persons who store the goods of another. The storer's lien has its origin in the Uniform Warehousemen's Lien Act passed by the ULC in 1921 and was enacted in all jurisdictions in Canada except Quebec. The warehousemen's lien was a possessory lien only. It existed only as long as the warehousekeeper has possession.

Ontario's Repairers' and Storers' Liens Act, referred to above, (which also expands the old warehousemen's lien into a storer's lien) states that anyone who stores goods (assuming the necessary agreement exists) has a lien for storage costs. The requirement that the warehousekeeper be "a person lawfully engaged in the business of storing goods as a bailee for hire", which exists now in the various warehousekeeper's Acts, is gone. The "storer" simply has to store the goods or store and repair the goods.

The Civil Law concept which most resembles that of the storer is the concept of depositary who, according to article 2293, has a right of retention for expenses similar to those incurred by a storer:

2293. The depositor is bound to reimburse the depositary for any expenses he has incurred for the preservation of the property, to indemnify him for any loss the property may have caused him and to pay him the agreed remuneration. The depositary is entitled to retain the deposited property until he is paid.

Again there is no right to release or to sell.

(c) Common carriers' liens:

This lien is given to those persons, who may not refuse a fare or the transportation of goods, to enable the collection of fees out of the goods transported. Unlike the above liens, which have a statutory base, the common carrier's lien is a common law lien. Section 2(4) of the Alberta Draft Act recommended that a "common carrier has a lien on goods for carriage charges in respect of which a bill of lading has been issued."

Pursuant to Article 2058 of the Civil Code provides that "the carrier may retain the property carried until the freight, the carriage charges and any reasonable storage charges are paid." The extension of this right to any reasonable storage charges is new to the 1994 Civil Code.

(d) Hotel keepers' liens:

This lien is given to those who run hotels and motels to collect the cost of lodging from luggage or other items left behind or kept in satisfaction of the bill. At one time, the innkeeper's lien existed solely at common law and for the same reasons as the common carrier's lien, i.e., the innkeeper was engaged in a common calling and was required to provide lodging. Alberta, Saskatchewan, the Yukon and the N.W.T. derive their statutes from the Hotel Keepers' Ordinance, O.N.W.T. 1884, No. 34. The Alberta Report advises us (see p. 24) that this Act is based on the Innkeepers Act, 1878, 41 & 42 Vict., c. 38 which gave an innkeeper a right of sale. The Uniform Hotel Keepers Act was passed in 1962.

The equivalent Civil Code provision is Article 2302 which permits an innkeeper to retain, as security for payment of the cost of lodging and services, the effects and baggage brought into the hotel by a guest, except personal documents and effects of no market value. Articles 2303, 944 and 955 permit sale by public auction or by agreement after 90 days. A thing that cannot be sold may be given to a charitable institution, or if that is not possible, the thing may be disposed of, as the innkeeper sees fit.

(e) Agisters' liens:

This is a stablekeeper's lien given to anyone who feeds and keeps livestock of another. Agisters' liens exist in Saskatchewan through an add-on section tucked into The Animal Products Act S.S. 1982, c. A-20.2. Section 15.1 was placed into this statute after The Stable Keepers' Act was repealed and inadvertently not re-enacted as part of the new statute. It creates a possessory lien for an animal keeper for the price of "food, care, attendance, accommodation, treatment or services" furnished to animals. In Alberta this lien is created by the Stable Keepers' Act which creates a lien for "stabling, boarding and caring" for animals.

The animal keeper's lien is treated in the Alberta Report like a repairer's lien and is included in s. 2(1) of the draft Act as the lien of a "person who has expended labour or skill for the purpose of improving, restoring or maintaining its condition or properties".

There is no Civil Code equivalent of this lien.

(f) Wood workers' liens:

This lien is given to those who perform any labour or provide services in connection with logs or timber, and creates an interest in the logs and timber in favour of the lienholder. Where those logs or timber have been mingled with other logs arising out of the same logging operation, the lien attaches to all logs in the mass.

Wood workers' liens exist now as non-possessory liens in those jurisdictions that have created these liens (see, for example, The Lien for Wages Act, R.S.O. 1990, c. F-28, the Woodmen's Lien Act, R.S.N.S. 1973, c. W-12, the Woodmen's Lien Act, R.S.M. 1987, c. W190, The Woodmen's Lien Act, R.S.S. 1978, C. W-16, The Woodworker Lien Act, R.S. B.C. 1979, c. 436 and the Woodmen's Lien Act, R.S.A. 1970, c. W-14).

There is no Civil Code equivalent of this lien.

(g) Threshers' liens:

This is a lien on harvested grain given to those who swath or combine crops. As the Alberta Report tells us (see: p. 28), the Threshers' Lien Ordinance, O.N.W.T. 1895, No. 24 gave Alberta, Saskatchewan and the territories their first Acts in this area.

There is no Civil Code equivalent of this lien.

(h) The Beet Lien:

The history of this Act is described at pp. 37 and 38 of the Alberta Report. The beet lien was developed in 1926 to provide protection to sugar beet harvesters to secure their wages by a lien on the harvested product and to those who provided capital in this industry.

There is no Civil Code equivalent of this lien.

After a detailed analysis of each of these liens, as they exist in Alberta, the Alberta Report recommended the retention of all such liens except the beet lien.

The Committee agreed with the Alberta Report's decision to examine the need to retain these liens but decided, for the purposes of the development of a Uniform Liens Act, the liens should be divided into two categories:

(a) those for which the nature of the activity was such it could be said to exist in all of Canada therefore making uniform treatment desirable;

(b) those for which the nature of the activity, and the need to protect it by means of a lien, could be said to be more local in nature, and for which it would not be justified for the Uniform Law Conference to recommend uniform legislation.

In the first category, the Committee placed the liens of repairers, storers, common carriers and hotelkeepers. In the second category, the Committee placed the balance: the liens of agisters, woodworkers and threshers and the beet lien. The liens in the second category could be said to concern issues that are more local in nature and should not be part of the proposed Uniform Liens Act. By necessity, the inclusion of warehousemen's liens in this proposed new legislation means that the Uniform Warehousemen's Lien Act is no longer required.

1. RECOMMENDATION:

(1) The Uniform Law Conference should only consider liens reform with respect to the liens of repairers, storers, common carriers and hotelkeepers.

(2) The Uniform Warehousemen's Lien Act should be withdrawn.


Next Annual Meeting

2017 Conference

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August 13 - 17, 2017
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