1900.

ed." After the sections as to registration, by section 19, "Where a claim for lien is so registered, the person en- Judgment. titled to the said lien shall be deemed a purchaser, pro KILLAM, C.J. tanto, and within the provisions of The Registry Act, but except as herein otherwise provided, The Registry Act shall not apply to any lien arising under this Act."

And by section 11, "The lien created by this Act shall have priority over ... all payments or advances made on account of any conveyance or mortgage after notice in writing of such lien to the person making such payments or after registration of such lien as hereinafter provided."

In Ontario, under statutory provisions substantially similar to those which I have just cited, excepting those of section 4, sub-section (2), it seems to be clearly settled that a mortgagee or grantee, taking subsequently to the arising of a lien and registering his conveyance or mortgage before the registration of the lien, without notice of the lien, has priority over the lienholder: Hynes v. Smith, 8 P. R. 73, 27 Gr. 150; Reinhart v. Shutt, 15 O. R. 325; Wanty v. Robins, 15 O. R. 474; McVean v. Tiffin, 13 A. R. 1; McNamara v. Kirkland, 18 A. R. 271. But a mortgagee or grantee taking with notice of the lien is, of course, bound by it: Re Wallis & Vokes, 18 O.R. 8.

Without considering whether, under a similar statute, I should have followed the Ontario decisions, it appears to me that section 4, sub-section (2), removes any doubt for this Province.

The lien arises by virtue of doing the work or furnishing the materials. The lien attaches upon the estate or interest of the "owner" as defined by the Act, thus including those claiming under the party for whom the werk is done or materials furnished, whose rights are thereafter acquired. The lien, upon registration, takes effect from the commencement of the work or from the placing of the materials, as against purchasers, etc., un

1900.

der instruments, registered or unregistered. This clause Judgment. appears to have been inserted for the purpose of specifiKILLAM,C J. cally settling the time from which the lien runs as against those taking from the party for whom the building is erected subsequently to the commencement of the work or of the supply of materials. For this purpose registration is required; but when there is registration of the lien, then the relative priorities as between it and conveyances or mortgages from the party for whom the work is done or the materials supplied are fixed by the statute, iriespective of registration of the conveyance or mortgage, and irrespective of any question of notice. Section 11 applies only, I think, to payments or advances made subsequently to the taking effect of the lien under conveyances or mortgages otherwise having precedence.

The clause providing for treating the lienholder, upon registration, as a purchaser pro tanto and within the provisions of The Registry Act, appears merely to be a further enactment in favor of the lienholder, placing him in a position to acquire, by registration, priority over those otherwise prior in point of time, and not affecting the definite enactment in section 4, sub-section (2). See Makins v. Robinson, 6 O. R. 1.

The plaintiff's claim was under one contract, by which he did work and furnished materials for a lump sum. He began his work before any of the mortgages were made by the defendant. He duly registered his claim before the registration of any of these mortgages, without any notice of them. Thus, under both section 4, sub-section (2), and section 19, the plaintiff stands first.

Objection is made to the registration of Stewart's claim on the ground that the statement registered alleged that the materials were furnished between the 1st August and the 27th October, whereas Stewart now claims for goods supplied before the 1st August.

1900.

By section 15, a claim for lien is to state, inter alia, the time or periods within which the work was, or was to be, Judgment. done, or the materials furnished or placed. But, by sec- KILLAM, C.J. tion 17, “A substantial compliance only with sections 15 and 16 of this Act shall be required, and no lien shall be invalidated by reason of failure to comply with any of the requisites of sections 15 and 16 of this Act, unless in the opinion of the Court, Judge, or Local Judge, who has power to try an action under this Act, the owner, contractor or sub-contractor, mortgagee or other person, as the case may be, is prejudiced thereby, and then only to the extent to which he is thereby prejudiced."

This latter clause appears divisible into two parts. First, only substantial compliance with sections 15 and 16 is required; and, secondly, no failure in such compliance, in however substantial a degree, is to invalidate the lien unless some party is prejudiced, provided there is registration of a claim.

I think that the onus on the question of prejudice is upon the party objecting to the registered claim. The defect is not to invalidate the lien, unless, in the opinion of the Judge, there is prejudice to some one. That is, the Judge must positively form the opinion, for which purpose he must have some evidence, either direct or arising out of the circumstances and the nature of the defect. In the present case there is nothing to suggest that any of the parties interested saw the registered statement of claim or knew its contents or was in any way affected by the error.

In my opinion, Stewart's claim was sufficiently registered to its full amount.

This does not seem, however, to settle fully the question of priority as between Stewart and the mortgagees. In section 2, in defining the term "owner," the statute speaks of those whose rights are acquired "after the work

1900. or service in respect of which the lien is claimed is comJudgment. menced or the materials furnished have been commenced KILLAM, C.J. to be furnished."

In section 5, sub-section (3), dealing with prior mortgages, the reference is to "a mortgage or other charge existing or created before the commencement of the work or of the placing of the materials or machinery upon the land"—that is, clearly, before the commencement of the placing. But in section 4, sub-section (2), the language is" from the date of the commencement of such work or service or from the placing of such materials"—that is, apparently, from the actual time of placing, and not from the commencement of the placing.

It is not unlikely that this difference has arisen from inadvertence. But these liens are wholly of statutory creation, and in derogation of ordinary rights. They can be given only such effect as the statute clearly warrants. While the whole statute must be read together, and one clause may assist in the construction of another, I cannot find in the other clauses such an indication of an entire intention as should affect the natural interpretation of the language in section 4, subsection (2). That clause seems to me to be the one which deals specifically with the relative priority of liens and mortgages made after commencement of work or furnishing materials and must govern upon that point. Stewart's claim is for materials solely, and there is no difficulty in severing the values of those supplied before and after the making of the mortgages. I think that I may properly assume the dates of supply, as shown by the account produced, to be the dates of "placing" upon the premises.

On

Bowen's mortgage bears date the 5th August. that day he advanced $300. On the same day Stewart supplied goods to the value of $41.09. There is no evidence as to which was done first. The plaintiff proved the various mortgages in opening. I think that the onus

was then thrown upon Stewart to prove a priority, and 1900. accordingly I place Bowen's original advance ahead of Judgment. Stewart's lien for this sum of $41.09. KILLAM, C.J.

The Western Co-operative Company's mortgage is dated 3rd October. The amount claimed for expenses is admittedly reasonable and to be a charge upon the land. The company has priority of registration over Bowen, and there is no evidence of notice of the Bowen mortgage. The company, therefore, should have priority over Bowen, which can be given by putting it in his place and postponing a corresponding portion of his claim to the position which the company would otherwise have.

According to Bowen's evidence, the last $135 were not advanced upon his mortgage until a few days after the 18th October. I will not assume the advance to have been before the 27th October, when Stewart supplied the last of his materials.

I think that the application to the company for a loan should be treated, under the circumstances, as sufficient notice in writing of Stewart's lien to postpone Bowen's charge for this advance under section 11, sub-section (1). The application is said to have been left with Bowen. I infer that he was one of the local directors who signed the recommendation endorsed upon it, and that this would not be done without an examination of its contents. His own evidence strengthens the conclusion that he knew the contents. The application, taken as a whole, seems to sufficiently imply the existence of Stewart's lien to some amount. It is true that it stated that there were no liens, judgments or other incumbrances against the property, but this was incorrect to Bowen's own knowledge, and, in answer to the question, "Can all claims, mortgages, etc., be paid off now?" the answer was, "Yes." Then the application distinctly showed money to be due to Stewart for materials used in the building and that the object of the loan was to pay off what was owing on the building.