Stewart v Gustafson

Canadian Property Law

Stewart v Gustafson
Image: ‘Old Farm Truck’ by Rick Mock

Conversion of seemingly abandoned property is not without the law, however there are inherent differences as to how best to remove or despatch such property, while considering the enduring proprietary rights of the original owners. In a matter concerning a number of goods of varying value, the claimants sought damages for loss, when after giving ample notice for their removal, the recent freehold purchasers took steps to enforce their rights to enjoyment of the land now owned.

Under a conveyance dated May 2 1994, the respondents purchased land from the claimant’s mother, on condition that time be given for the removal of specific items owned by her son and daughter-in law. With an express threshold of July 31 1994 for all items outstanding, the claimants removed a portion of the items listed, after which no attempts were made to recover the remainder.

Noted within the conveyance was express mention that:

“Any items remaining after deadline shall be considered abandoned and can be disposed of in discretion by the purchaser who will exercise prudent discretion.”

And so upon expiration of the agreed threshold, the respondents proceeded to both remove and where possible, sell the items either privately for profit, or by way of scrap, with the remaining few items kept under secure storage.

At the point of litigation, the claimants argued that unless stated, the items both sold and left in situ, were still under ownership, and that no acquirement of title has succeeded, despite no attempts to remove them beyond the period stated. With reference to the principle of abandonment, the court observed the academic position adopted in ‘The Abandonment and Recaption of Chattels’ (1994) by Lee Aitkin, in which it reads:

“The act of abandonment, in Pollock’s terms, confers a revocable licence which is only terminated when a subsequent possessor manifests dominion over the chattel with the intention of possessing it to the exclusion of others, including the former possessor.”

However in ‘Is Divesting Abandonment Possible at Common Law’ (1984) by AH Hudson, it was argued that abandonment through intention was sufficient enough to warrant acquisition by those taking new ownership, (otherwise known as ‘divesting abandonment’) which in effect, created further confusion as to how best to ascertain when property has been lawfully abandoned.

In Canada (Attorney General) v Brock, the Canadian Supreme Court had earlier turned to American jurisprudence when adhering that once relinquished of title, such property remains abandoned until appropriated by those intending to take ownership, while ‘Black’s Law Dictionary’ (1979) clarified how:

“Abandonment includes both the intention to abandon and the external act by which the intention is carried into effect.”

With particular regard to the case in hand, McCutcheon v Lightfoot had enabled the Supreme Court of Canada to rule how:

“[A]bandonment of a chattel may be inferred in circumstances where an owner fails to remove his or her chattels within a reasonable time after receiving notice from the proprietor demanding their removal. In such circumstances, the destruction, consumption or sale of the chattels would not constitute a conversion thereof.”

While in Addison on Torts (7th Edn), it was equally argued that:

“A man cannot be made a bailee of goods against his will; and, therefore, if things are left at his house, or upon his land, without any consent or agreement on his part to take charge of them, he is not thereby made a bailee of them.”

Thus with close examination of the rights afforded both parties, the court held that the items retained and sold or disposed of, were subject to five distinct groups, within which three were estopped from right of claim, damages for conversion were awarded at $300 for the item sold privately and the final group remained abandoned unless agreed otherwise.

Key Citations

“Failure by the owner to remove his or her chattels in circumstances where the proprietor of the premises in which the chattels are located has expressed an intention to treat the chattels as abandoned will often be sufficient to give rise to a valid defence of estoppel to an action for conversion”

“[A]n involuntary custodian of the chattels of another may not unilaterally impose forfeiture terms whereby the owner will forfeit his or her interest therein if the specified terms are not met.”