Citation

Correia v. Smith, 2015 ONSC 918

Court File and Parties

Court File No. CV-14-508403

Date: 20150210

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN: JOSE A. CORREIA a.k.a. JOE A. CORREIA and 1664478 ONTARIO INC. (Applicants)

AND: BRADLY CAPEN SMITH c.o.b.a. SMITH TRUCKING and 6395287 CANADA INCORPORATED c.o.b.a. CANADIAN DIESEL SERVICES (Respondents)

BEFORE: K.W. WHITAKER J.

HEARD: January 28, 2015

COUNSEL: K. Misir for the moving applicants Correia J. at al.

M.R. Todd for the respondents Canadian Diesel Services et al.

E N D O R S E M E N T

[1] This is an application under the Repair and Storage Liens Act. The applicant seeks damages for the breach of a lease agreement by the respondent Smith and the improper sale of the applicant’s vehicle by the respondent Canadian Diesel, in contravention of the Act.

[2] In October 2012, Smith entered into a lease with Correia for a commercial dump truck in working condition.

[3] Smith went into arrears on the lease payments, having paid out $9,825 out of $77,637. In August 2013 Correia called Smith about the overdue payments. Smith told him that the truck's engine was being repaired.

[4] The applicant called Smith again and was told that the truck was back in Smith’s possession. After this call, Smith had the truck towed back to Canadian Diesel’s garage.

[5] Repairs were authorized by Smith and he was told by Canadian that the truck was ready for pick up. Smith did not pick up the vehicle. CD sent a notice to Smith asserting a lien on the truck. The letter was sent back. Following negotiations between CD and Smith, the parties agreed that Smith could take back the truck for $13,000. Smith did not pay the money or show up to take the truck.

[6] Correia contacted Smith and asked him to pay the bill. In February of 2014 Smith delivered the agreed upon $12,000. The truck would not start. Smith’s money was returned and he didn’t take the truck.

[7] CD sold the truck for $30,000 without notice to the applicant. CD claimed it needed the cash to pay for its services and disbursements.

[8] In May 2014, the truck was sold to Tatro Equipment; the asking price was $48,000.

[9] With respect to notice, the applicant never received any notice of the pending sale. After the notices were mailed, the parties entered into a compromise agreement.

[10] I accept that the notice of pending sale was not provided to Correia and that by entering into another agreement, CD had waived its right to rely on the notice in taking further action to sell the truck. I agree that the notice sent by CD in any event is insufficient even if served, for the 3 reasons set out in the factum of Correia: no statement about redemption, no mention of to whom payment was to be made and no particulars of the private sale or public sale.

[11] I find that the sale of the truck was not commercially reasonable contrary to the Act.

[12] Finally, there can be no doubt that Smith beached the lease for a number of reasons including the outstanding arrears and the fact that the vehicle was unlawfully sold to a third party.

[13] Order accordingly.

K.W. WHITAKER J.

Released: