Lovats Acceptance Corp. v. Advantagewon Inc., 2018 ONSC 6985
CITATION: Lovats Acceptance Corp. v. Advantagewon Inc., 2018 ONSC 6985
DIVISIONAL COURT FILE NO.: 153/17 DATE: 20181121
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
BETWEEN:
LOVATS ACCEPTANCE CORP.
Riaz S. Ahmed, for the Applicant (Respondent in Appeal)
Applicant (Respondent in Appeal)
– and –
ADVANTAGEWON INC.
David MacKenzie, for the Respondent (Appellant in Appeal)
Respondent (Appellant)
HEARD at Toronto: November 21, 2018
MATHESON J. (Orally)
[1] The Appellant Advantagewon Inc. appeals from the decision of Deputy Small Claims Court Judge Prattas dated February 24, 2017.
[2] The Respondent on this appeal, Lovats Acceptance Corp., was the applicant before the Small Claims Court. Lovats sought and obtained a judgment ruling that the Appellant did not have a valid lien under the Repair and Storage Liens Act, R.S.O. 1990, c. R.25 (the “RSLA”).
[3] By way of brief background, Lovats provided financing to the owner of a Mercedes Benz for the car purchase, and registered its interest under the Personal Property Securities Act, R.S.O. 1990, c. P.10.
[4] About six months later, on December 2, 2015, the owner of the car applied for a loan from the Appellant for the purchase and installation of winter tires, summer tires, rims and a front wheel bearing.
[5] On December 7, 2015, the owner took his car to Superior Tire & Auto (“STA”). STA installed the winter tires, changed the front wheel bearing and fitted the summer tires and rims.
[6] On that date, the owner was provided with an invoice, which he signed, and the owner and STA also signed an agreement called the Contractual Repair Agreement. Those documents were sent to the Appellant, after which the owner was given a Mastercard funded by the Appellant. The owner used that card to pay the bill, after signing the card. The owner then left STA with his car.
[7] The Agreement signed by the owner and STA included an assignment of any lien rights of STA to a numbered company, and there was evidence at trial of a later assignment to the Appellant.
[8] As for the summer tires, there was some evidence at trial that the summer tires were installed before the car was repossessed.
Decision Below
[9] The Deputy Judge found in favour of the Respondent, Lovats. He found that the Appellant did not have a valid lien under the RSLA. He found that at the time of the assignment, the lien had been fully paid and there was therefore no lien to assign. He further found that the requirements of an enforceable lien as set out in s. 7(5) of the RSLA had not been met.
[10] The Deputy Judge also assessed the amount of the lien, if wrong in his other conclusions.
Issues
[11] On this appeal, the Appellant submits that the Deputy Judge erred in three ways:
(1) in finding that there was no lien to assign to the Appellant at the time of the assignment, given the evidence before the Deputy Judge regarding the order of the steps taken;
(2) in finding that s. 7(5) of the RSLA, which requires a signed acknowledgment of indebtedness, had not been complied with; and
(3) in his finding about the amount of the lien, which was based on whether or not the summer tires had ever been installed.
Standard of Review
[12] The standard of review is as set out in Housen v. Nikolaisen, 2002 SCC 33 [2002] 2 S.C.R. 235: for questions of law the standard of review is correctness, for questions of fact, palpable and overriding error and for questions of mixed fact and law, the standard of review varies. Where a legal principle can be extracted from the question of mixed law and fact, the standard for that question is correctness. Where the issue is the application of correct legal principles to the facts, the standard is palpable and overriding error.
[13] There is no dispute before me that the applicable standard of review with respect to the above three issues raised in this appeal is palpable and overriding error.
Analysis
[14] I have concluded that the second issue raised, regarding s. 7(5) of the RSLA, disposes of this appeal. It is therefore unnecessary to address the other issues.
[15] Subsection 7(5) of the RSLA provides as follows:
A non-possessory lien is enforceable only if the lien claimant obtains a signed acknowledgment of the indebtedness which acknowledgment may be on an invoice or other statement of account. [Emphasis added.]
[16] There is no dispute that the lien asserted by the Appellant is a non-possessory lien and therefore s. 7(5) must be complied with.
[17] The Deputy Judge addressed s. 7(5) as follows:
Counsel for the Respondent further submitted that its non-possessory lien is enforceable in this instance because the Owner acknowledged the debt when he signed the Invoice – an acknowledgment which is required by section 7(5) of the RSLA.
I do not accept the Respondent’s submission on this point. Robert, the principal of the Repairer, was clear in his testimony that when the Owner signed the Invoice it was done for the purposes of acknowledging the work done – not to acknowledge any debt.
[18] The Deputy Judge therefore founded his decision on the finding of fact in para. 46 about the invoice being for the purpose of acknowledging the work done and not to acknowledge any debt. This finding of fact is supported by the testimony of the Appellant’s witness as referred to by the Deputy Judge in para. 46.
[19] To the extent that the Appellant did and does rely on the invoice signed by the owner, I agree that s. 7(5) permits reliance on an invoice. However, the invoice in question, as signed by the owner, clearly stated that the amount was “paid”. The invoice therefore does not demonstrate that the Deputy Judge was clearly wrong in his factual finding. On the contrary, it is consistent with the Deputy Judge’s factual finding.
[20] Having considered the evidence before the Deputy Judge, I find that the Appellant has failed to demonstrate that the Deputy Judge’s factual finding, which underlies his decision on s. 7(5), is clearly wrong, unreasonable or unsupported by the evidence.
[21] The Deputy Judge’s decision regarding s. 7(5) therefore stands and, pursuant to that section, the claimed lien is unenforceable regardless of the disposition of the other issues.
[22] Therefore, and despite the very able argument of Appellant’s counsel, this appeal is dismissed.
[23] I have endorsed the Appeal Book and Compendium as follows: “Appeal dismissed for oral reasons. Costs to Respondent in agreed upon amount of $8,600, all inclusive.”
___________________________ MATHESON J.
Date of Reasons for Judgment: November 21, 2018
Date of Release: November 22, 2018
CITATION: Lovats Acceptance Corp. v. Advantagewon Inc., 2018 ONSC 6985
DIVISIONAL COURT FILE NO.: 153/17 DATE: 20181121
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
BETWEEN:
LOVATS ACCEPTANCE CORP.
Applicant (Respondent in Appeal)
– and –
ADVANTAGEWON INC.
Respondent (Appellant)
ORAL REASONS FOR JUDGMENT
MATHESON J.
Date of Reasons for Judgment: November 21, 2018
Date of Release: November 22, 2018