This appeal arose from the seizure of heavy construction equipment without notice following a default on a promissory note and an unassumed lease.
The trial judge had dismissed the appellants' counterclaim, concluding that no notice was required under the Personal Property Security Act (PPSA).
The Court of Appeal allowed the appeal, holding that the common law duty to provide reasonable notice before seizing secured assets (the Lister v. Dunlop principle) was not displaced by the PPSA.
Furthermore, the Asset Purchase Agreement (APA) explicitly required 15 days' notice, and the doctrine of merger did not apply to this personal property transaction.
The court also found that the trial judge erred in holding Mr. Priest personally liable for the unassumed excavator lease, as he was not a party to that specific agreement.
The cross-appeal regarding the trial judge's re-calculation of damages in the main action was dismissed, as no error in principle was identified.
The case was remitted to the Superior Court for an assessment of damages on the counterclaim.