Fabio M. Soccol

The appellant supplied floor and wall coverings to the respondent, a retail store, without knowing or inquiring about the specific improvements where the materials would be used.

When the respondent became insolvent, the appellant claimed that the moneys received by the respondent from its customers were trust funds under section 8(1) of the Construction Lien Act, and sought to hold the respondent's principals personally liable for breach of trust.

The Court of Appeal, sitting as the Divisional Court, dismissed the appeal, holding that a trust under the Act only arises if the supplier intends the materials to be used for a known and identified improvement.