A BILL FOR A COMMERCIAL LIENS ACT FOR BRITISH COLUMBIA, CANADA CYNTHIA CALLAHAN-MAUREEN. Legislative Drafting Project

Post-Baccalaureate Diploma in Legislative Drafting A BILL FOR A COMMERCIAL LIENS ACT FOR BRITISH COLUMBIA, CANADA by CYNTHIA CALLAHAN-MAUREEN Legislative Drafting Project submitted to Eamonn Moran, P.S.M., Q.C. and Sandra Markman in partial fulfillment of the requirements for the Post-Baccalaureate Diploma in Legislative Drafting Athabasca, Alberta February 2013 CYNTHIA CALLAHAN-MAUREEN

ABSTRACT This Bill would implement the British Columbia Law Institute s Report on the Uniform Liens Act, which recommends that the Uniform Liens Act prepared by the Uniform Law Conference of Canada be enacted in British Columbia, with minor changes. The Bill would replace common law carriers liens and liens under the Repairers Lien Act, the Livestock Lien Act, the Warehouse Lien Act, and the Motor Vehicle Act. The Uniform Liens Act would create a consistent set of rules for liens that are common to all Canadian provinces and secure payment for commercial services provided in relation to goods (repairers, storers and common carriers liens). The Act would integrate this area of lien law with the provinces personal property security legislation, including rules for attachment, perfection by possession or by registration in a personal property registry, and priority in relation to other interests in the same goods, including other liens under the Act. The Act would provide for enforcement of lien rights, including through the adoption of enforcement procedures under personal property security legislation. This reform is intended to protect lien holders from easily losing their lien rights, and to provide fair and effective enforcement procedures to all parties who have interests in goods subject to a lien.

ACKNOWLEDGEMENTS I would like to thank Ronald C.C. Cuming, Q.C., Professor of Law, University of Saskatchewan for generously giving me the benefit of his expertise in the areas of personal property securities and liens through his comments on my analysis and drafting. Ron was a member of the committee that prepared the Uniform Liens Act for the Uniform Law Conference of Canada. I would also like to acknowledge the financial support I received from the Government of British Columbia, through the BC Public Service Pacific Leaders Program.

Bill X 2013 COMMERCIAL LIENS ACT Contents PART 1 INTERPRETATION AND APPLICATION 1 Interpretation 2 Exclusions from scope of Act 3 Application of Personal Property Security Act PART 2 NATURE AND EXTENT OF LIEN 4 Lien for commercial services 5 Attachment of lien 6 Enforceability of lien 7 Amount secured by lien 8 Assignment of lien 9 Effect of granting of credit 10 Effect of taking of security interest PART 3 PERFECTION AND PRIORITIES 11 Perfection 12 Grace period for registration 13 Priority over other interests 14 Subordination of unperfected lien 15 Protection of buyer or lessee of goods 16 Priority among liens PART 4 ENFORCEMENT Division 1 Seizure of Goods 17 Definition 18 Appointment to exercise powers 19 Seizure 20 Security may be required 21 Bailee may be appointed 22 Surrender of possession to lien claimant 23 Disposition after seizure 24 Personal liability protection Division 2 Disposition by Lien Claimant 25 Lien claimant may dispose of goods Division 3 Dispute Resolution 26 Court may resolve dispute 27 Payment into court 28 When goods are released PART 5 MISCELLANEOUS 29 Common law liens abolished 30 Power to make regulations 31 Transition 32 Repeal 33-36 Consequential Amendments 37 Commencement

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of the Province of British Columbia, enacts as follows: 1 Interpretation 1 (1) In this Act: 2 PART 1 INTERPRETATION AND APPLICATION acknowledgement means a written 3 record, 4 signed by the person 5 who requested services be provided in relation to goods, that (a) describes the goods, and (b) acknowledges an obligation to pay for the services; authorization means a written record, signed by the person who requested services be provided in relation to goods, that (a) describes the goods, and (b) authorizes the services; court means the Supreme Court or the Provincial Court; 6 goods, in relation to a lien, except in sections 4 (1) and (2) [lien for commercial services], means the goods that are subject to the lien; lien, except in sections 4 (2) [lien for commercial services], 29 [common law lien abolished] and 31 [transition], means a lien under section 4 (1) [lien for commercial services]; lien claimant means a person who has a lien; security interest means an interest in goods that secures payment or performance of an obligation; services, in relation to goods, means: (a) labour and materials for the purpose of restoring, improving or maintaining the condition of goods; (b) labour and materials for the purpose of salvaging goods; (c) the storage of goods; (d) the transportation, carriage or towage of goods. (2) For the purposes of sections 6 (a) [enforceability of lien] and 11 (2) (a) [perfection], a lien claimant does not have possession of goods if (a) the goods are in the actual or apparent possession or control of the person who requested the services or that person's agent, or (b) the goods are being held as a result of a seizure or repossession. Exclusions from scope of Act 7 2 (1) This Act does not apply to a contractor s or subcontractor s lien or a contractor s charge under the Forestry Service Providers Protection Act. 8 (2) This Act does not apply to the towage of goods under the Tugboat Worker Lien Act. 9 2

Application of Personal Property Security Act 10 3 (1) Subject to subsection (2) and any other provision of this Act, the following provisions of the Personal Property Security Act apply, with the changes the circumstances require, to a lien as though the lien were a security interest: (a) section 1 (2) [knowledge]; (b) section 5 [law applicable: general rules for goods and collateral in possession of secured party]; (c) section 6 [law applicable: parties intend goods to be removed from jurisdiction]; (d) section 7 [law applicable: mobile goods, intangibles, etc.]; (e) section 8 [law applicable: substance and procedure]; (f) section 17 [rights and obligations of secured parties in possession of collateral]; (g) section 18 [acquisition of information from secured parties]; (h) Part 4 [registration]; (i) Part 5 [rights and remedies on default]; (j) section 68 [supplementary law]; (k) section 69 [consequences of non-compliance with Act]; (l) section 71 [extension of time for compliance]; (m) section 72 [service of statements, notices and demands]; (n) section 76.1 [fees]; (o) the prescribed provisions, if any. (2) For the purpose of applying, under subsection (1), a provision of the Personal Property Security Act, a reference in the provision to a word or expression set out in Column 1 of the following table is to be read as a reference to the word or expression set out opposite to it in Column 2: TABLE Column 1 Column 2 collateral goods secured party lien claimant debtor person who requested the services security agreement authorization or acknowledgement Lien for commercial services PART 2 NATURE AND EXTENT OF LIEN 4 (1) A person has a lien on goods for services provided, for consideration, by that person in relation to the goods at the request of a person (a) with an interest in the goods, (b) in possession of the goods, or (c) legally entitled to possession of the goods. 3

(2) A person who, under the legislation of another province, 11 has a lien on goods for services provided, for consideration, by that person in relation to the goods is deemed to have a lien under subsection (1) if (a) the services were provided at the request of a person (i) with an interest in the goods, (ii) in possession of the goods, or (iii) legally entitled to possession of the goods, and (b) the lien is registered in a public registry 12 of that province. (3) If a lien claimant repudiates the agreement to provide the services before completing the services, the lien ceases to exist. 13 Attachment of lien 5 A lien attaches to the goods when (a) the services begin, and (b) the lien is enforceable under section 6 [enforceability of lien]. 14 Enforceability of lien 6 A lien is enforceable when (a) the goods subject to the lien are in the possession of the lien claimant, or (b) the lien claimant has received an acknowledgement or authorization from the person who requested the services. Amount secured by lien 15 7 (1) A lien secures the amount, if any, that the person who requested the services agreed to pay, in an acknowledgement or authorization, for the services if the services have been completely provided. (2) A lien secures the fair market value of the services provided if (a) the services have not been completely provided, despite any amount set out in an acknowledgement or authorization that the person who requested the services agreed to pay for the services, (b) an acknowledgement or authorization does not specify an amount that the person who requested the services agreed to pay for the services, or (c) no acknowledgement or authorization exists in relation to the services. (3) The existence of an amount specified in an acknowledgement or authorization as the amount to be paid for the services does not affect the right of the person who requested the services to dispute the amount. Assignment of lien 8 A lien may be assigned, in writing, to a person to whom the debt secured by the lien is assigned. 4

Effect of granting of credit 9 If a lien claimant grants credit to the debtor for the payment of the debt to which the lien relates, the granting of credit does not affect the existence, 16 attachment, perfection or priority of the lien. Effect of taking of security interest 10 A lien claimant who, to secure the amount of a lien, takes a security interest in the goods is deemed to have taken the security interest in substitution for the lien. Perfection PART 3 PERFECTION AND PRIORITIES 11 (1) In this section: financing statement has the same meaning as in the Personal Property Security Act; owner includes a buyer, a lessee and a consignee under a transaction to which the Personal Property Security Act applies; serial numbered goods has the same meaning as in the Personal Property Security Regulation. (2) A lien is perfected under this Act when (a) it has attached to the goods, and (b) it has been perfected by (i) possession of the goods by the lien claimant or by a person acting on behalf of the lien claimant, or (ii) registration under subsection (3), 17 regardless of the order of occurrence. 18 (3) A lien is perfected by registration of a financing statement in the personal property registry in accordance with Part 4 of the Personal Property Security Act if, (a) in the case of serial numbered goods, the goods are described by their serial number, or (b) in the case of goods that are not serial numbered goods, both of the following are identified as debtors: (i) the person who requested the services, and (ii) the owner of the goods, if the person who requested the services is not the owner of the goods. (4) If perfection of a lien has ended and the lien is perfected again, the date of perfection is the date of the more recent perfection. Grace period for registration 12 (1) A lien perfected by possession remains perfected for 15 days after the lien claimant returns the goods to the control of the person who requested the services if the lien is perfected by registration within that 15 days. 5

(2) A lien that attached without the lien claimant having possession of the goods and is perfected by registration no later than 15 days after the provision of the services has ended 19 is deemed to have been perfected from the first day of the 15 days. Priority over other interests 13 (1) Subject to this Act and to any other Act, a perfected lien has priority over another interest in the same goods that was created after the lien attached. (2) A perfected or unperfected lien has priority over (a) a security interest that attached before the lien attached, and (b) a writ of execution issued or a charging order granted before the lien attached. Subordination of unperfected lien 14 (1) If a lien is unperfected when the goods that are subject to the lien are seized under legal process to enforce a judgment, including under a writ of execution, equitable execution or a charging order affecting the goods, the lien is subordinate to the interest of (a) a person who caused the goods to be seized, (b) a creditor entitled by law to participate in the distribution of the seized goods or their proceeds, and (c) a representative of creditors, but only for the purposes of enforcing the rights of a person referred to in paragraph (a). (2) A lien is not enforceable (a) against a trustee in bankruptcy, if the lien is unperfected at the date of the bankruptcy, or (b) against a liquidator appointed under the Winding-up and Restructuring Act (Canada), if the lien is unperfected at the date that the winding-up order is made. (3) A lien is subordinate to a security interest if the lien (a) is unperfected when the security interest is perfected, and (b) attached before the security interest attached. Protection of buyer or lessee of goods 15 (1) In this section: consumer goods means goods that are used or acquired for use primarily for personal, family or household purposes; 20 value means any consideration sufficient to support a simple contract, and includes an antecedent debt or liability. 21 (2) A buyer or lessee of goods sold or leased in the ordinary course of business of the seller or lessor takes the goods free of a perfected or unperfected 22 lien on the goods, whether or not the buyer or lessee has knowledge of the lien. (3) A buyer or lessee of goods takes goods free of an unperfected lien on the goods if the buyer or lessee (a) gave value for the interest acquired, and (b) bought or leased the goods without knowledge of the lien. 23 6

(4) A buyer or lessee of goods that are acquired as consumer goods takes the goods free of a perfected or unperfected lien on the goods if the buyer or lessee (a) gave value for the interest acquired, and (b) bought or leased the goods without knowledge of the lien. (5) Subsection (4) does not apply to a lien on goods the purchase price of which exceeds $1 000 or, in the case of a lease, the market value of which exceeds $1 000. (6) A buyer or lessee of goods takes the goods free of a lien that is perfected during the 15 days referred to in section 12 [grace period for registration] if, during that 15 days, the buyer or lessee (a) gave value for the interest acquired, and (b) bought or leased the goods without knowledge of the lien. Priority among liens 24 16 (1) If more than one lien has attached to the same goods, the lien in relation to which the services were provided first has priority over the other liens. (2) A lien that has attached to goods takes priority over an unattached lien. Definition 17 In this Part, sheriff 25 includes Appointment PART 4 ENFORCEMENT Division 1 Seizure of Goods (a) a bailiff licensed under the Business Practices and Consumer Protection Act, and (b) a person appointed under section 18 [appointment], except in the exercise of the power of appointment under section 18. 18 A sheriff may appoint one or more persons to exercise any of the powers given to a sheriff under this Part. Seizure 19 (1) A lien claimant may cause goods to be seized by a sheriff if (a) the amount secured by the lien remains unpaid, and (b) any period granted for payment 26 has expired. (2) A sheriff must not seize the goods unless the lien claimant or an agent of the lien claimant has executed and delivered a warrant in the prescribed 27 form to the sheriff who is to carry out the seizure. (3) In carrying out a seizure, a sheriff may exercise any powers given to a secured party by section 58 [right of seizure or repossession] of the Personal Property Security Act. (4) A seizure under this section does not affect the interest of a person who, under this Act or any other law, has priority over the rights of the lien claimant. 7

Security may be required 20 A sheriff may refuse to carry out or continue a seizure of the goods unless the sheriff is given security sufficient to (a) cover the sheriff's fees and expenses in relation to the seizure, and (b) indemnify the sheriff for anything done in relation to the seizure, including indemnification for claims by the person who requested the services in relation to the lien or a third party. Bailee may be appointed 21 (1) A sheriff may, at any time after carrying out a seizure of the goods in relation to which a lien is perfected by registration, appoint a person in possession of the goods as bailee of the sheriff if the person executes an undertaking in the prescribed form (a) to hold the goods as bailee for the sheriff, and (b) to deliver up possession of the goods to the sheriff on demand. (2) Seized goods held by a bailee appointed under subsection (1) are deemed to be held under seizure by the sheriff. Surrender of possession to lien claimant 22 A sheriff may surrender possession or the right of possession of the goods seized to the lien claimant or a person designated in writing by the lien claimant. Disposition after seizure 23 (1) A sheriff may release seized goods if the sheriff gives, before or after the goods are seized, a notice that complies with subsection (2) to the lien claimant named in the warrant under which the seizure is made and the lien claimant fails by that date to take possession of the goods or to pay the fees and expenses. (2) A notice under subsection (1) must be in writing and must state that the goods specified in the notice are to be released on the date specified in the notice unless the lien claimant (a) takes possession of the goods specified in the notice, and (b) pays the sheriff s fees and expenses in relation to the seizure. (3) When the goods are released under subsection (1), the lien ceases to exist. Personal liability protection 24 The sheriff is not liable for the following if it occurs after the goods are surrendered under section 22 [surrender of possession to lien claimant] or released under section 23 [disposition after seizure]: (a) loss of or damage to the goods; (b) unlawful interference with the rights of the person who requested the services or another person who has rights in or to the goods. 8

Lien claimant may dispose of goods Division 2 Disposition by Lien Claimant 25 If the person who requested the services fails to pay the amount secured by the lien within 30 days after the day on which it becomes payable, the lien claimant may realize on the goods in accordance with Part 5 [rights and remedies on default] of the Personal Property Security Act, and the lien claimant has all the rights and obligations of a secured party under that Part. Court may resolve dispute Division 3 Dispute Resolution 26 (1) The person who requested the services or another person who claims a proprietary interest in, or a contractual right to possession of, the goods may apply to the court for resolution of a dispute regarding (a) the existence of the lien, (b) the amount secured by the lien, or (c) the right of the lien claimant to take or retain possession of the goods. (2) In addition to the powers conferred on a court under the Personal Property Security Act, on hearing an application under subsection (1), the court may make any order that it considers appropriate in the circumstances. Payment into court 27 (1) In an application under section 26 [court may resolve dispute], if the amount claimed by the lien claimant is paid into court or security for the amount is posted with the court, the registrar must issue to the applicant a certificate setting out the details of the payment or security. (2) On the receipt of the certificate, the lien claimant must (a) release the goods, or (b) not later than 7 days 28 after receiving the certificate, file a notice of objection with the court stating that additional or alternate security should be posted with the court before release of the goods. (3) If a notice of objection has been filed and the applicant has posted the additional or alternative security, the lien claimant must release the goods. (4) If the court concludes that the lien is not valid or that the additional or alternative security is not justified, the court must order the lien claimant to pay to the applicant damages for any loss suffered or cost incurred by the applicant as a result of having to pay money into court or post security or additional or alternative security. When goods are released 28 (1) When goods have been released under section 27 (2) (a) or (3) [payment into court], the lien is replaced by a charge on the amount paid into court or on the security posted 9

(2) The charge is discharged 90 days after the goods are returned by the applicant unless the lien claimant accepts the applicant's offer to settle 29 or commences an action to recover the amount claimed. (3) After the expiry of 90 days, the registrar must return to the applicant the money paid into court or the security posted if the applicant files with the registrar an affidavit confirming that the lien claimant has not accepted the applicant's offer to settle or commenced an action to recover the amount claimed. Common law liens abolished PART 5 MISCELLANEOUS 29 Any lien arising under the common law of the kind that secures an obligation secured by a lien under this Act is abolished. 30 Power to make regulations 30 (1) The Lieutenant Governor in Council 31 may make regulations referred to in section 41 of the Interpretation Act. (2) Without limiting subsection (1), the Lieutenant Governor in Council may make regulations as follows: (a) excepting any kind, category or class of goods or services from the application of this Act; (b) specifying one or more sections of the Personal Property Security Act for the purposes of section 3 of this Act; (c) respecting the matters set out in section 76 of the Personal Property Security Act as they relate to this Act; (d) defining, for the purposes of this Act or the regulations, a word or expression used but not defined in this Act; (e) for meeting or removing any difficulty arising out of the transition to this Act from the Livestock Lien Act, the Repairers Lien Act, the Warehouse Lien Act, liens under the Motor Vehicle Act or the enforcement of a lien under section 9 (4) of the Transport of Dangerous Goods Act, and for that purpose disapplying or varying any provision of this Act. (3) Without limiting subsections (1) and (2), Transition (a) the Lieutenant Governor in Council may make regulations respecting any matter for which regulations are contemplated by this Act; (b) regulations may be specific or general in their application and may make different provision for different kinds, categories or classes of prescribed matters, including, without limitation, different persons, goods, services, circumstances, acts or other matters for which regulations are contemplated by this Act. 31 (1) In this section, prior law means the law in force immediately before the date on which this section comes into force. 32 10

Repeal (2) This Act applies to every lien created under prior law that has not been validly terminated in accordance with prior law before the date on which this section comes into force. (3) A lien created under prior law that is validly registered under the Repairers Lien Act is deemed to be registered under this Act for the unexpired portion of the registration and may be continued by registration under this Act. 32 (1) The Livestock Lien Act, R.S.B.C. 1996, c. 272, is repealed. (2) The Repairers Lien Act, R.S.B.C. 1996, c. 404, is repealed. (3) The Warehouse Lien Act, R.S.B.C. 1996, c. 480, is repealed. Consequential Amendments Hotel Keepers Act 33 33 Section 2 of the Hotel Keepers Act, R.S.B.C. 1996, c. 206, is repealed and replaced with the following: 2 (1) An innkeeper, boarding house keeper or lodging house keeper has a lien on the baggage and property of a guest, boarder or lodger for the value or price of food or accommodation furnished to the guest, boarder or lodger. (2) If the value or price of food or accommodation furnished to the guest, boarder or lodger remains unpaid for 3 months, a lien under subsection (1) may, in addition to all other remedies provided by law, be enforced in the manner provided under the Commercial Liens Act. (3) This section does not apply to a tenant occupying a rental unit to which the Residential Tenancy Act applies.. Motor Vehicle Act 34 34 (1) Section 188 (5) of the Motor Vehicle Act, R.S.B.C. 1996, c. 318, is repealed and replaced with the following: (5) A lien under subsection (4) is deemed to be a lien under section 4 (1) of the Commercial Liens Act.. (2) Section 192 is amended (a) in subsection (2) by striking out The agent has a lien against the motor vehicle or trailer and substituting The agent is deemed to have a lien under section 4 (1) of the Commercial Liens Act against the motor vehicle or trailer, and (b) by repealing subsection (3). (3) Section 215.4 (6) is amended by striking out are a lien on the motor vehicle, and the lien may be enforced in the manner provided under the Warehouse Lien Act. and substituting are deemed to be a lien on the motor vehicle under section 4 (1) of the Commercial Liens Act.. 11

(4) Sections 254 (3) (e) and 255 (4), (5) (c) (i) and (6) are amended by striking out the Warehouse Lien Act and substituting the Commercial Liens Act. (5) Section 255 (3) is repealed and replaced with the following: (3) The lien described in subsection (4) is deemed to be a lien under section 4 (1) of the Commercial Liens Act.. Personal Property Security Act 35 35 The Schedule to the Personal Property Security Act, R.S.B.C. 1996, c. 359, is amended (a) in Column 1 of Items 1 and 6 by striking out under this Act, the Sale of Goods Act or the Forestry Service Providers Protection Act and substituting under this Act, the Sale of Goods Act, the Forestry Service Providers Protection Act or the Commercial Liens Act, and (b) by repealing Item 4. Transport of Dangerous Goods Act 36 36 Section 9 (4) of the Transport of Dangerous Goods Act, R.S.B.C. 1996, c. 458, is amended by striking out the Warehouse Lien Act and substituting the Commercial Liens Act. Commencement 37 This Act comes into force by regulation of the Lieutenant Governor in Council. Explanatory Note This Bill gives a person who provides services in relation to goods a lien on the goods for the amount owing. The Bill sets out rules for the attachment and perfection of these liens and establishes priorities for the liens in relation to other interest in the same goods. The Bill provides for the enforcement of these liens, including by the adoption of provisions of the Personal Property Security Act. This Bill also repeals, and makes consequential amendments to, other Acts. 12

1 Section 10 of the Interpretation Act, R.S.B.C. 1996, c. 238 sets out the language required for an enacting clause. 2 Section 1 of the Interpretation Act defines Act to mean an Act of the Legislature, which section 29 defines to mean the Lieutenant Governor acting by and with the advice and consent of the Legislative Assembly. Section 28 defines Legislative Assembly to mean the Legislative Assembly of British Columbia constituted under the Constitution Act, R.S.B.C. 1996, c. 66. 3 Section 29 of the Interpretation Act defines writing broadly to include words that are represented or reproduced by any mode of representing or reproducing words in visible form. 4 Section 29 of the Interpretation Act defines record broadly to include books, documents, maps, drawings, photographs, letters, vouchers, papers and any other thing on which information is recorded or stored by any means whether graphic, electronic, mechanical or otherwise. A requirement to provide a written record is satisfied if the record is in electronic form and otherwise complies with the Electronic Transactions Act (S.B.C. 2001, c. 10). 5 Section 29 of the Interpretation Act defines person to include a corporation, partnership or party, and the personal or other legal representatives of a person to whom the context can apply according to law. 6 Section 29 of the Interpretation Act defines the Provincial Court as the Provincial Court of British Columbia, and the Supreme Court as the Supreme Court of British Columbia. 7 The liens and charges under these Acts are the types of liens that were identified in the Uniform Law Conference of Canada s Report on Commercial Liens as being local to only some Canadian provinces, so that they should not be included in uniform legislation intended for all Canadian provinces. 8 S.B.C. 2010, c. 16. 9 R.S.B.C. 1996, c. 466. 10 R.S.B.C. 1996, c. 359 (the PPSA). 11 Only provinces have personal property security legislation. The term jurisdiction in section 2 (2) of the Uniform Law Conference of Canada s Uniform Lien Act, 2000 (ULA, 2000) includes Canada, which is overly broad. Section 29 of the Interpretation Act defines province when referring to a part of Canada, to include the three territories (the Northwest Territories, Nunavut and Yukon). 12 The phrase registered in a public registry departs from section 2 (2) of the ULA, 2000 registered under the personal property security legislation of that jurisdiction but is consistent with section 3 (2) (b) of Saskatchewan s Commercial Liens Act, S.S. 2001, c. C-15.1 (the SK CLA). The broader language is intended to include a right of retention under Article 974 of Quebec s Civil Code (the equivalent of a common law lien) so that it may be deemed to be a lien under this Bill in the event that the Civil Code is amended to provide for registration of that right. See the description of liens in Canada in the first section of the Report on Commercial Liens. 13 The ULA, 2000 reflects the policy decision that a lien claimant who repudiates a contract for services loses the lien securing payment for those services. This policy should be differentiated from the general rule of repudiation in contract law, that repudiation of a contract ends all future obligations between the parties but does not extinguish rights and obligations that have already 13

matured (Guarantee Co. of North America v. Gordon Capital Corp., [1999] 3 S.C.R. 423, <http://canlii.ca/t/1fqkv> at para. 40). 14 A lien is not enforceable under the ULA, 2000 unless the lien claimant has possession of the goods or an acknowledgement or authorization in respect of the goods (s. 5). Unlike the ULA, 2000, this Bill makes enforceability a prerequisite for attachment. This change simplifies the steps required to enable a lien claimant to enforce a lien, and makes the rules applicable to liens more similar to those applicable to security interests under personal property security legislation. 15 This section consolidates all provisions of the ULA, 2000 that deal with the amount secured by the lien (ss. 3, 4 (1) and 5 (3)). 16 Existence is based on ceases to exist, British Columbia s plain language equivalent to the ULA, 2000 s extinguish. See, for example, the Repairers Lien Act, R.S.B.C. 1996, c. 404; Woodworker Lien Act, R.S.B.C. 1996, c. 491; Tugboat Worker Lien Act, R.S.B.C. 1996, c. 466). 17 The requirement for registration under section 11 (3) to perfect a lien is consistent with the ULA, 2000, but more concise. This structure avoids the need for an extra provision to clarify that out-of-province liens that are deemed to be liens under subsection 4 (1) must still be perfected under this Bill even if they have already been registered in the other province (see s. 8 (6) of the ULA, 2000). 18 This provision incorporates the rules set out in section 19 of the PPSA. These rules apply to a lien under this Bill because enforceability is a condition of attachment. This is not the case in the ULA, 2000 (see footnote 14). 19 This phrase departs from after completion of the services in the ULA, 2000 to make it clear that the 15-day period applies regardless of whether the services have been completed or the services ended after being partially completed. 20 The definition of consumer goods that exists in both Manitoba s Personal Property Security Act, C.C.S.M. c. P35 and Ontario s Personal Property Security Act, R.S.O. 1990, c. P.10 has been judicially interpreted to apply to consumer goods that are used wholly for personal, family or household purposes, such as household furniture (Vanhove (Re), 1994 CanLII 7321 (ON SC), <http://canlii.ca/t/1vt54>) and a customized Pontiac Trans Am (Capital City Savings and Credit Union Ltd. v. Alberta Motor Products Ltd., 2003 ABQB 129 (CanLII) <http://canlii.ca/t/5d4t>). 21 The term value in this provision has the same, particular meaning as in the parallel provisions in sections 20 and 30 of the PPSA (see the definition in s. 1, PPSA). 22 The priority of the buyer or lessee of goods sold in the ordinary course of business over a perfected lien diverges from the ULA, 2000, but is consistent with the policy of consumer protection reflected in section 30 (2) of the PPSA and in the amendments to section 13 (2) of the SK CLA made by S.S. 2010, c. 10, s. 2. 23 This provision has been relocated from section 11 (3) (a) [where lien subordinate or unenforceable] of the ULA, 2000 so that all situations in which the lien is subordinate to the rights of a buyer or lessee of the same goods are in the same section. 24 Priority among liens is subject to enforceability requirements, which is made clear in section 14 of the SK CLA. This Bill makes enforceability a condition of attachment. 25 Sheriffs in British Columbia are governed by the Sheriff Act, R.S.B.C. 1996, c. 425. 14

26 The ULA, 2000 and the SK CLA use repayment but that term does not seem appropriate for a contract for services which gives rise to a lien. 27 Section 29 of the Interpretation Act defines prescribed to mean prescribed by regulation. 28 The SK CLA also provides for a seven-day period. The three days specified in the ULA, 2000 did not seem adequate. 29 Offer to settle is the term defined in Rule 9-1 (1) of the Supreme Court Civil Rules, B.C. Reg. 168/2009. 30 The same provision in the SK CLA has been judicially interpreted to clarify that abolishment of these equivalent common law liens was effective only as of the date that Act came into force, so that common law liens that existed on that date were not extinguished (Paccar Financial Services Ltd. v. T.G.W. Holdings Ltd., 2002 SKQB 467 (CanLII) <http://canlii.ca/t/5ddf>). 31 Section 29 of the Interpretation Act defines Lieutenant Governor in Council to mean the Lieutenant Governor acting by and with the advice of, or by and with the advice and consent of, or in conjunction with, the Executive Council. 32 The ULA, 2000 does not specify whether prior law should encompass the common law in addition to statutes giving rise to liens which are to be repealed. The SK CLA limits the scope of its transitional provision to a lien created by statute law. This Bill abolishes every common law lien of a kind that arises under the Bill, therefore liens under prior law should include liens that arise by common law. For example, carriers liens exist only at common law. 33 An innkeeper s lien under the Hotel Keepers Act, R.S.B.C. 1996, c. 206 secures the value of food or accommodation provided to a guest. That lien is not included, or deemed to be a lien under, this Bill, because liens under this Bill secure the value of services provided in relation to goods. 34 The British Columbia Law Institute made no recommendation regarding liens under the Motor Vehicle Act, R.S.B.C. 1996, c. 318. Those liens are deemed to be liens under this Bill because they secure the costs of the same services that give rise to a lien under the Bill (storage, transportation and towing). The policy reflected in these amendments is based on provisions in Saskatchewan s Traffic Safety Act, S.S. 2004, c. T-18.1 that refer to the SK CLA. 35 This provision amends the Schedule to the PPSA, as amended by section 18 of the Forests, Lands and Natural Resource Operations Statutes Amendment Act, 2012 (S.B.C. 2012, c. 14, not in force). The amendments provide that certain fees set out in the Schedule apply to registrations in the Personal Property Registry under this Bill. 36 The British Columbia Law Institute made no recommendation regarding the lien under the Transport of Dangerous Goods Act. That lien is not deemed to be a lien under this Bill because that lien is not a commercial lien. The lien is held by a dangerous goods inspector designated under that Act, and secures all costs and charges of the detention of a road vehicle or rail vehicle that an inspector reasonably believes is related to the discharge, emission or escape of dangerous goods by reason of any condition occurring during the handling or transportation of the dangerous goods or a contravention of that Act or the regulations or a term of a permit. 15

Bibliography Alberta Law Reform Commission, Report on Liens (Report for Discussion No. 13) by R. Wood (Edmonton, September 1992). British Columbia Law Institute, Report on the Uniform Liens Act (Report No. 23) (Vancouver, January 2003). Commercial Liens Act, S.S. 2001, c. C-15.1. Cuming, Ronald C.C., The Spreading Influences of PPSA Concepts: The Uniform Liens Act, (1999) 15 Business and Finance Law Review 1. Liens Act, S.N.S. 2001, c. 33 (not in force). Ontario Law Reform Commission, Report on the Non-possessory Repairman s Lien (Toronto, Ministry of the Attorney General, 1972). Personal Property Security Act, R.S.B.C. 1996, c. 359. Uniform Law Conference of Canada, Report on Amending the Uniform Liens Act and background materials (Proceedings of Annual Meeting, Victoria, 2000) available at http://www.ulcc.ca/en/2000-victoria-bc/341-civil-section-documents/168-report-onamending-the-uniform-liens-act-2000 and http://www.ulcc.ca/en/2000-victoriabc/341-civil-section-documents/170-amending-the-uniform-liens-act-backgroundmaterials-2000. Uniform Law Conference of Canada, Report on Commercial Liens (Proceedings of Annual Meeting, Charlottetown, 1994) available at http://www.ulcc.ca/en/1994- charlottetoen-pe/448-civil-section-documents/330-report-on-commercial-liens-1994. Uniform Law Conference of Canada, Uniform Liens Act, 2000 available at http://www.ulcc.ca/en/uniform-acts-en-gb-1/488-liens-act/694-liens-act-2000. 16