Can a mortgagee take possession of a gas engine that was left out on a hire and purchase system when the hirer failed to pay its first instalment?

Saskatchewan, Canada


The following excerpt is from The Berlin Interior Hardwood Company v. The Colonial Investment and Loan Company, 1918 CanLII 254 (SK QB):

In Hobson v. Gorringe, supra, A gas engine was let out on the hire and purchase system under an agreement in writing, which provided that it should not become the property of the hirer until the payment of all the instalments, and should be removable by the owner on the failure of the hirer to pay any instalment. The engine was affixed to freehold land of the hirer by bolts and screws to prevent it from rocking, and was used by him for the purposes of his trade. Default having been made in the payment of the instalments, the engine was claimed by the owner, and also by a mortgagee of the land, who took his mortgage after the hiring agreement and without notice of it, and had entered into possession while the engine was still on the land: Held, that the engine was sufficiently annexed to the land to become a fixture, and that any intention to be inferred from the terms of the hiring agreement that it should remain a chattel did not prevent it from becoming a fixture; and consequently that it passed to the mortgagee as part of the freehold.

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