Seller's Revendication Remedy as a Fossil, The

The Seller’s Revendication Remedy as a Fossil

Martin Boodman*

The author argues that the seller’s revendica-
tion remedy is a fossil of pre-codification
Quebec law. The author states the reasons for
this as being firstly, that there is an inherent
contradiction in the remedy being limited to
sales not made on credit or with a term, and
secondly, that the pre-codification basis for the
remedy, namely the unpaid seller’s continued
ownership of the goods sold and delivered to
the buyer cannot exist in a post-codification
era which is characterised by the consensual
transfer of ownership of moveables. These two
factors culminate in an unresolvable conflict
between principles protecting the unpaid seller
as creditor and those protecting the debtor
from precipitous demands for payment.
The first part of the paper explains the anom-
alous and inferior status of the seller’s revendi-
cation remedy within the Quebec model of
security on moveable property. The second
part is a development of the historical and
modem analysis of the rules in article 1999(1)
and (4) of the Civil Code of Lower Canada
concerning sales with a term. The author
argues that a detailed analysis of these rules, as
well as of the notions of term and mise en
demeure is critical to understanding why this
remedy can no longer have any meaningful
existence in the present law of Quebec.
The author uses this debate as a forum for
understanding the nature and the characteris-
tics of Quebec codification, and in this regard,
considers the degree to which codal interpreta-
tion should include historical analysis, and
more specifically, issues of codal interpreta-
tion and conflict of policies underlying codal
provisions.

L’auteur soumet que le droit de revendication
du vendeur est, en droit qu6b6cois, un fossile
d’avant la codification. f1 propose deux expli-
cations pour ceci. Tout d’abord, il est contra-
dictoire que ce droit se limite aux ventes sans
cr6dit et sans terme. Deuxi~mement, sous le
Code civil du Bas-Canada, la propri~t6 des
meubles est transfr6 par la rencontre des
volontds. Le maintien d’un droit de propri6t6
du vendeur impay6, sur des biens meubles
vendus et livrs, A la base du droit de revendi-
cation, ne peut donc plus etrejustifi6e. II s’en-
suit que les r~gles prot6geant le vendeur
impay6 en tant que crancier se heurtent h
celles visant la protection du d6biteur contre
des demandes abusives de paiement.
En premiere partie, l’auteur explique le statut
anormal et inf6rieur du droit de revendication
du vendeur dans le cadre du module qu6b6cois
des suret6s sur les meubles. La seconde partie
de l’article 6tudie I’analyse historique et
modeme des r~gles ayant trait aux ventes 4
terme, &lictdes A l’article 1999(1) et (4) du
Code civil du Bas-Canada. L’auteur soutient
qu’une analyse en d6tail de ces r~gles, ainsi
que des notions de terme et de mise en
demeure, est indispensable pour comprendre
pourquoi l’action en revendication n’a plus de
place dans le contexte du droit qu6b6cois
actuel.
L’auteur se sert du droit de revendication
comme base pour discuter de la nature et des
consequences de la codification au Qu6bec.
Dans cette veine, il 6value la n6cessit6 de
recourir ht une analyse de l’historique et des
politiques qui sous-tendent le Code.

*Associate Dean (Academic) of the Faculty of Law, McGill University. I would like to thank my
colleagues Professors R.A. Macdonald, Frank Buckley, Daniel Jutras, Ralph Simmonds and
Stephen Scott, as well as those who attended a Faculty Workshop at the Faculty of Law, McGill
University, April 5, 1989 for their helpful comments on earlier drafts of this article. I am also grate-
ful to Mr. Justice Am6d6e Monet, J.A. Any errors or omissions are the sole responsibility of the
author. The use of the masculine pronoun throughout the text is adopted for the convenience of
the author and is not intended to preclude the feminine.
McGill Law Journal 1989
Revue de droit de McGill

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[Vol. 35

Synopsis

Introduction
I.
H. Historical Analysis of Article 1991(1) and (4) C.C.L.C.

Revendication as an Inferior Remedy

1. Codifiers’ Sources
2. Roman Law

III. Modern Analysis of Article 1999(1) C.C.L.C.

Interpretive Framework for Modern Analysis

1.
2. The Notion of a Term
3. The Role of Putting in Default
4. Sale on Credit or With a Term
5. Critique and Response

Conclusion

Introduction

There are two methods of enquiry into the natural and social sciences. One
method, the search for unity and simplification, focuses upon characteristics
which comply with a unified conceptual view. The second approach derives
principles through the analysis of complex and diverse particulars or anomalies.

This paper is an application of the second mode of enquiry to the reven-
dication remedy of the seller of moveables in the law of Quebec. It is intended
to establish that the rarely used seller’s revendication remedy under articles
1998(1) and 1999 C.C.L.C. is a fossil or relic from pre-codification Quebec law
resulting from an oversight of codification and inertia in law reform. Two
related arguments are offered in support of this conclusion. First, in its historical
and modem incarnation, the revendication remedy suffers from the inherent
contradiction of being limited to sales not made on credit or with a term.
Second, the pre-codification basis for the remedy –
an unpaid seller’s contin-
ued ownership of goods sold and delivered to a buyer –
cannot exist in a post-
codification era characterized by the consensual transfer of ownership of move-
ables. In a modem perspective, these anomalies culminate in an unresolvable

1989]

SELLER’S REVENDICATION REMEDY

conflict between principles protecting an unpaid seller as a creditor and those
protecting debtors from precipitous demands for payment.

Given the thesis of this paper, its arguments are developed and presented
as completely as possible. Hence, the seller’s revendication remedy and its pre-
conditions shall be considered in their historical and modem contexts. The first
part of this paper is an explanation of the anomalous and inferior status of the
seller’s revendication remedy within the Quebec model of security on moveable
property. It is followed by historical and modem analyses of the rules in articles
1999(1) and (4) C.C.L.C. regarding sale with a term. A detailed examination of
these rules, as well as the notions of a term and- mise en demeure are critical to
understanding why the remedy can have no meaningful existence in the present
law of Quebec.

The analysis of the seller’s revendication remedy is also a paradigm for
understanding the nature and characteristics of Quebec codification. This theme
is considered explicitly in two parts of the paper. First, in a prelude to the study
of article 1999(1) C.C.L.C. in its modem context, the issue of the degree to
which codal interpretation should include an historical analysis is addressed.
Second, in response to a potential critique of the thesis that the revendication
remedy of the seller of moveables is defunct, issues of codal interpretation and
the conflict of policies underlying codal provisions are considered.

I. Revendication as an Inferior Remedy

The right of revendication under articles 1998(1) and 1999 C.C.L.C. per-
mits a seller of moveables under certain circumstances to reacquire custody of
goods sold and delivered for non-payment of the purchase price. Like the sel-
ler’s right of retention,’ the right of revendication is a conservatory, custodial
remedy.2 It does not dissolve the contract of sale, terminate the buyer’s owner-

‘See arts 1496, 1497 C.C.L.C.; M. Pourcelet, La vente, 5th ed. (Montreal: Th~mis, 1987) at 172;
T. Rousseau-Houle, Precis du droit de la vente et du Iouage, 2nd ed. (Quebec: Presses de l’Uni-
versit6 Laval, 1986) at 200; M. Boodman, “The Prepaying Buyer of Corporeal Moveables in
Quebec” (1987) 47 R. du B. 871 at 919; M. Boodman, “The Right of Retention of the Seller of
Moveables in Quebec” (1988) 67 Can. Bar Rev. 658 at 683; Y. Goldstein, “A Bird’s Eye View of
Conflicting Claims” [1981] Meredith Memorial Lectures (Toronto: R. DeBoo, 1982) 88 at 92; R.A.
Macdonald, “Privileges and other Preferences upon Moveable Property in Quebec: Their Impact
upon the Rights and Recourses of Execution Creditors” in M.A. Springman & E. Gertner, eds,
Debtor-Creditor Law: Practice and Doctrine (Toronto: Butterworths, 1984) 255 at 339; P.-B.
Mignault, Le droit civil canadien, vol. 7 (Montreal, Wilson & Lafleur, 1906) at 72; T. Rousseau-
Houle, “Les r~cents d~veloppements dans le droit de la vente et du louage de choses au Quebec”
(1985) 15 R.D.U.S. 307 at 376; Drouin v. Gilbert (1937), 63 B.R. 174.
2See Pourcelet, ibid. at 173-74; Rousseau-Houle, Precis de droit de la vente et du louage, ibid.
at 201-02; Boodman, “The Prepaying Buyer of Corporeal Moveables in Quebec”, ibid.; P. Ciotola,
Droit de saretis 2d ed. (Montreal: Th~mis, 1987) at 250; L. Faribault, Traitg de droit civil du
Quebec, vol. 11 (Montreal: Wilson & Lafleur, 1961) at 353; Goldstein, ibid. at 92-93; Macdonald

McGILL LAW JOURNAL

[Vol. 35

ship, nor remedy the buyer’s refusal or inability to pay the purchase price. In
fact, the right of revendication is often described as an extension of the seller’s
right of retention beyond delivery.3 In this regard, an unpaid seller who reven-
dicates goods sold and delivered is in the same legal position as one who has
withheld delivery through a right of retention.

Despite its ostensible affinity to the seller’s right of retention, the right of
revendication is an anomaly in the context of the unpaid seller’s remedies and
in the broader context of security on moveables in Quebec. Essentially, the
revendication remedy is rarely used in practice and has been overshadowed by
the unpaid seller’s other post-delivery recourses, particularly the right of disso-
lution under article 1543 C.C.L.C.

In a post-delivery scenario, dissolution of the contract of sale is a better
remedy for an unpaid seller than revendication. Both of these remedies are exer-
cised by the intervention of suit4 with the possibility of a seizure before judg-
ment.5 Yet, the scope of enforceability of dissolution under article 1543
C.C.L.C. is greater and more effective than that of revendication.

in Springman & Gertner, eds, ibid. at 341; R.A. Macdonald & R.L. Simmonds, “The Financing
of Moveables: Law Reform in Quebec and Ontario” [1981] Meredith MemorialLectures (Toronto:
R. DeBoo, 1982) 246 at 261, 263; Rousseau-Houle, “Les r6cents d6veloppements dans le droit de
la vente et du louage de choses au Qu6bec”, ibid. at 377; Mignault, ibid. at 146-48; R.A.
Macdonald, “Enforcing Rights in Corporeal Moveables: Revendication and its Surrogates Part
Two” (1986) 32 McGill L.J. 1 at 11; Jocami Inc. v. Joly, [1982] C.S. 637.
3See Pourcelet, ibid. at 173; Rousseau-Houle, Pricis de droit de la vente et du louage, ibid. at
200-01; Macdonald, “Enforcing Rights in Corporeal Moveables: Revendication and Its Surrogates
Part Two”, ibid.; R.A. Macdonald, “Security under Section 178 of the Bank Act: A Civil Law
Analysis” (1983) 43 R. du B. 1007 at 1055-56; Macdonald & Simmonds, ibid. at 262; Boodman,
ibid. at 918; Boodman, “The Right of Retention of the Seller of Moveables in Quebec”, supra, note
1 at 673; Jocami Inc. v. Joly, ibid.; Juris-classeur civil, art. 2044-2123, “Privilges, Privileges sp6-
ciaux sur les meubles, Privilge du vendeur des meubles”, by R. Fridman-Clause, fasc. H-2, No.
1; Encyclopdie juridique Dalloz: Ripertoire de droit civil, 2d ed., vol. 6 “Privilfges mobiliers”,
by H. Thuillier, No. 129; H. & L. Mazeaud, J. Mazeaud & F. Chabas, Legons de droit civil, t. 3,
vol. 1, 6th ed. by V. Ranouil & F. Chabas (Paris: Montchrestien, 1988), Nos 187, 193.
4See arts 1538, 1544 C.C.L.C. a contrario; Pgpin v. Feeney (1936), 44 R.L. 74 (C.S.); Fiducie
du Quibec v. Fabrication Prdcision Inc., [1978] C.A. 255; R.A. Macdonald, “Enforcing Rights in
Corporeal Moveables: Revendication and Its Surrogates Part One” (1986) 31 McGill L.J. 573 at
600-01, 614, 629-30; Macdonald, “Enforcing Rights in Corporeal Moveables: Revendication and
Its Surrogates Part Two”, ibid.
5See art 734(1) C.C.P.; Thibault v. Dame Perron-Lanthier (1968), [1969] B.R. 138; F. & W.
Sichelschmidt v. H. Nickel Industries of Canada Ltd. (1975), [1976] C.S. 142; Jocami Inc. v. Joly,
supra, note 2; Aminagements Arto Inc. v. Canadienne de gestion L Bouvier Inc. (1987), 11 Q.A.C.
269, [1987] R.LQ. 753, [1987] R.D.J. 113 (C.A.); Alcools de Commerce Inc. v. Corp. de Produits
Chimiques de Valleyfield Inc., [1985] C,A, 686, 56 C.B.R. (n.s.) 255; Keymar Equipment Ltd. V.
Thomcor Holding Ltd., [1983] C.S. 326; Rousseau-Houle, “Les r~cents dfveloppements dans le
droit de la vente et du louage de choses au Qu6bec”, supra, note 1 at 384-86; Ciotola, supra, note
2 at 249.

1989]

SELLER’S REVENDICATION REMEDY

As a remedy which retroactively re-establishes a seller’s ownership, disso-
lution, if available, is completely enforceable against a buyer’s unsecured cred-
itors and creditors with security on after-acquired or future property. The prior-
ity vis-t-vis the former results from the retroactive removal of goods from the
buyer’s patrimony and, hence, from the common pledge of his unsecured cred-
itors.6 The priority vis-h-vis the latter is also related to ownership. The future
property secured creditors of a buyer who might compete with a seller are banks
with security under section 178 of the Bank Act,7 transferees of property in stock
under Division IT of An Act Respecting Bills of Lading, Receipts and Transfers
of Property in Stocks and trustees for bondholders under the Special Corporate
Powers Act.9 A condition for the validity of each of these security mechanisms
is that the debtor be or become owner of the collateral security at some time dur-
ing the lifetime of the creditor’s security interest.” Dissolution of the contract
of sale under article 1543 C.C.L.C. prevents fulfillment of this condition.
Further, special priority rules regarding an unpaid seller vis-h-vis a bank with
section 178 security1 and a transferee of property in stock have been inter-

6See arts 1980, 1981 C.C.L.C.
7R.S.C. 1985, c.B-1.
SAn Act Respecting Bills of Lading Receipts and Transfers of Property in Stock, R.S.Q. c. C-53

[hereinafter Bills of Lading Act].

9R.S.Q. 1977, c. P-16, ss. 27-30.
ISee as regards Bank Act security, Bank Act, supra, note 7, s. 178(2); Macdonald, “Security
under section 178 of the Bank Act: A Civil Law Analysis”, supra, note 3 at 1019-20, 1051-52; J.
Auger, “Les sfret~s mobiIi~res sans d6possession sur des biens en stock en vertu de Ia loi sur les
banques et du droit qurb~cois” (1983) 14 R.D.U.S. 221 at 235-37; G.E. LeDain, “Security Upon
Moveable Property in the Province of Quebec” (1956) 2 McGill LJ. 77 at 104; Macdonald and
Simmonds, supra, note 2 at 266; Y. Caron, “La vente et le nantissement de la chose mobilire d’au-
trui: Deuxi~me partie” (1977) 23 McGill L.J. 380 at 413; L. Payette, “Nantissement commercial
– Chose d’autrui” (1980) 40 R. du B. 677 at 680; Union Sulphur Co. of New York v. Riordan Co.
(1922), 30 R.L. n.s. 144 (C.S.) at 150-51; La Chaine Cooperative du Saguenay Inc. v. Laberge,
[1959] C.S. 320 at 326-30; Ackroyd Brothers (Canada) Ltd. v. Brackon Products Inc., [1948] C.S.
407 at 408-09; Boodman, “The Prepaying Buyer of Corporeal Moveables in Quebec”, supra, note
I at 901; Boodman, “The Rights of Retention of the Seller of Moveables in Quebec”, supra, note
I at 691-92.
As regards the transfer of property in stock, see Bills of Lading Act, supra, note 8, s.13; Auger,
at 235, 237; R.A. Macdonald, “Inventory Financing in Quebec after Bill 97” (1984) 9 Can. Bus.
L.J. 153 at 159; Y. Renaud, “La cession de biens en stock: deux regimes, deux sfiretrs de meme
nature” (1984) 86 R. du N. 253 at 285.
As regards trust deed security under the Special Corporate Powers Act, see Special Corporate
Powers Act, ibid. at 236-37; Macdonald, Security under Section 178 of the Bank Act: A Civil law
Analysis”, supra, note 3 at 1066.

‘See Bank Act, ibid., s. 179(2) which provides inter alia that the bank’s priority over the claim
of any unpaid vendor under s.179(1) “…does not extend over the claim of any unpaid vendor who
had a lien on the property at the time of the acquisition by the bank of the … security, unless the
same was acquired without knowledge on the part of the bank of such lien ….

12See Bills of Lading Act, supra, note 8, s.27(I) which states: “The transferor must indicate to
the transferee in the writing evidencing the transfer any claim of an unpaid vendor affecting the

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preted not to displace the enforceability and priority of the seller’s dissolution
remedy under article 1543 C.C.L.C.3

The priority of the dissolution remedy over a buyer’s unsecured creditors
and future property secured creditors is reflected in the procedural domain so
that a seller, as eventual and retroactive owner under article 1543 C.C.L.C.,
could likely withdraw goods from a seizure before or after judgment by a com-
peting unsecured creditor or future property secured creditor of the buyer. The
requirement in article 1543 C.C.L.C. that a buyer be in possession of goods pur-
chased at the time of exercise of the dissolution remedy by a seller is not
breached by seizure by a third party. In this context, seizure before or after judg-
ment does not deprive a debtor of possession of goods seized, but merely puts
them in the hands of justice.'” The only case in which a seizure might cause a
seller to lose the remedy due to breach of the possessory requirement in article
1543 C.C.L.C. would be seizure after judgment in favour of a future property
secured creditor exercising a secured, possessory remedy as opposed to a pref-
erence on judicial sale proceeds. 6 In this case, however, an informed seller
could oppose any seizure before judgment and seize before judgment in his own
right to preserve his buyer’s possession and the dissolution remedy.
Nonetheless, the voluntary, extra-judicial transfer of possession by a buyer to a
secured creditor with a possessory remedy including those with security on
after-acquired property would, of course, render the seller’s dissolution remedy
unavailable.

The priority of the dissolution remedy is not affected by a buyer’s bank-
ruptcy. Given its basis in ownership, a seller’s dissolution remedy is enforceable
against a buyer’s trustee in bankruptcy whose administration is limited to assets
in a bankrupt debtor’s patrimony.”

transferred property, and any claim so indicated takes precedence over the rights of the transferee.”
13See Macdonald, “Security under Section 178 of the Bank Act: A Civil Law Analysis”, supra,
note 3 at 1058; Goldstein, supra, note 1 at 96; Auger, supra, note 10 at 299; Macdonald, “Inventory
Financing in Quebec after Bill 97”, supra, note 10 at 173; LeDain, supra, note 10 at 108-09;
Boodman, “The Right of Retention of the Seller of Moveables in Quebec”, supra, note 1 at 693;
Knitrama Fabrics Inc. v. K. & A. Textiles Inc., [1984] C.S. 1202; Minard v. Latulipe, Renaud,
Bourque Lte, [1986] R.J.Q. 657 (C.S.); Keymar Equipment Ltd. v. Thomcor Holding Ltd., supra,
note 5; Re Win. A. Marsh Co. & Buzzell (1930), 11 C.B.R. 63 (C.S.).

14For a discussion of oppositions to withdraw goods from seizure before and after judgment, see

Boodman, “The Right of Retention of the Seller of Moveables in Quebec”, ibid. at 697-700,

15See art. 737 C.C.P.; art. 2001, para. 1 C.C.L.C.; Enterprises Jean-Claude Lalonde Lte v.
Blanchette, [1980] C.S. 509. Nevertheless, there is some confusion in the case law as to the notions
of possession and custody in the context of seizures before and after judgment. See Heltzel Co. v.
Mont-Royal Steel Product Inc., [1980] C.A. 221; Cie de construction Belcourt v. Bronzage 3
Soleils Inc. (1985), [1986] R.D.J. 26 (C.A.).

16See arts 565-67 C.C.P. as regards compulsory execution in moveable real actions.
17See Bankruptcy Act, R.S.C. 1985, c. B-3, ss 16(3), 67, 81; J.M. Deschamps, “Le Syndic: Un
Successeur du Dfbiteur? Un Cessionnaire? Un Repr~sentant des Crdanciers?” [1985] Meredith

1989]

SELLER’S REVENDICATION REMEDY

By contrast, a seller’s revendication remedy under articles 1998 and 1999
C.C.L.C. affords little or no protection against competing unsecured creditors
and future property secured creditors of a buyer. As a privileged remedy, reven-
dication is ostensibly enforceable against all unsecured creditors and lower
ranking secured creditors of a buyer. 8 Such lower ranking secured creditors
include a trustee for bondholders under the Special Corporate Powers Act, 9 but,
due to statutory provisions regarding seller’s priorities, do not include a bank
with section 178 security or a transferee of property in stock.2″ Even this limited
ostensible enforceability, however, is eliminated where any competing creditor
of a buyer seizes the goods. According to article 2000, paragraph 1 C.C.L.C.,2″
a judicial sale at the initiative of a third party pending proceedings in revendi-
cation or a seizure before the revendication remedy is exercised automatically
transforms the seller’s remedy into a preference on judicial sale proceeds.
Hence, a seller could not on the basis of a revendication remedy withdraw goods
from a seizure in execution after judgment by any competing creditor of the
buyer. This rule should apply as well to a third party seizure before judgment,
a conservatory measure which from the point of view of oppositions to with-
draw is assimilated to seizure after judgment.2 It would be inconsistent to pro-
hibit enforcement of the seller’s revendication remedy at the stage of seizure
after judgment yet permit preservation of the remedy vis-h-vis seizure before
judgment by a competing creditor. The rule in article 2000, paragraph 1
C.C.L.C. also implies that any third party contestation of a seizure before judg-
ment taken by a seller pending revendication will extinguish the revendication
remedy and activate the preference on judicial sale proceeds. Finally, the rule
in article 2000, paragraph 1 C.C.L.C. implies that a seller’s revendication rem-

Memorial Lectures (Toronto: R. DeBoo, 1986) 245 at 249-51; Re Beatrice Pines Ltd.: Vendome
Knitting Mills Ltd. v. Lawrence (1967), [1968] C.S. 351; Re Iberville Furniture and Appliances
Co.: Grobstein v. Facto (1956), 4 C.B.R. (n.s.) 36 (C.S.); Re Rosenzweig: Hart v. Goldfine Ltd.
(1921), 2 C.B.R. 255, 31 B.R. 558,70 D.L.R. 174 aff’g 1 C.B.R. 385, 431, 56 D.L.R. 101 (C.A.).
‘8See as regards ranking of claims as a basis for determining priority among competing, secured
possessory remedies Boodman, “The Right of Retention of the Seller of Moveables in Quebec”,
supra, note I at 687; Macdonald, in Springman & Gertner, eds, supra, note 1 at 337-44;
Macdonald, “Security Under Section 178 of the Bank Act: A Civil Law Analysis”, supra, note 3
at 1061ff.; Sous-Ministre du Revenu du Quebec v. Total Rental Equipment Inc., [1979] C.S. 840;
Elliott Krever & Assoc. Ltd. v. Montreal Casting Repairs Ltd., [1969] C.S. 6; Gagnon v. Banque
Nationale (1920), 29 B.R. 166.
19Supra, note 9, s.29, para. 2.
2 See authorities cited in note 13 which tend to give a bank and transferee of property in stock

absolute priority over a seller’s revendication remedy under arts 1998 and 1999 C.C.L.C.

21Article 2000, para. 1 C.C.L.C. reads as follows:

If the thing be sold pending the proceedings in revendication, or if, when the thing is
seized at the suit of a third party, the vendor be within the delay and the thing in the
conditions prescribed for revendication, the vendor has a privilege upon the proceeds
in preference to all other privileged creditors hereinafter mentioned.

22See Macdonald in Springman & Gertner, eds, supra, note 1 at 341-42. See also text accom-

panying note 14.

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edy is not enforceable against a buyer’s trustee in bankruptcy despite the thirty-
day rule in article 1998, paragraph 2 C.C.L.C.’ A trustee in bankruptcy who
represents both the debtor and the debtor’s creditors possesses a debtor’s prop-
erty as a court-appointed receiver exercising a combined conservatory and liq-
uidation function analogous to that of a custodian under a seizure before or after
judgment.24

Article 2000, paragraph 1 C.C.L.C. indicates that in cases of seizure before
and after judgment the preservation of goods is assumed and revendication
becomes superfluous. In both cases, the seller can exercise at his option the dis-
solution remedy under article 1543 C.C.L.C. accompanied by seizure before
judgment or an opposition to withdraw the goods from a competing seizure, or
the preference on judicial sale proceeds through the mechanism of seizure
before judgment?’ or opposition for payment after judicial sale.26 Further, a
seller can exercise these remedies within the context of a buyer’s bankruptcy.
The result is that revendication as a conservatory remedy is effective only
between seller and buyer. Where third parties are competing with a seller, the
unenforceability of revendication in the face of third party seizures and the
availability to the seller of other conservatory and final remedies makes reven-
dication superfluous.

In summary, the seller’s revendication remedy is not enforceable against
two of the three potential future property secured creditors of a buyer. These
creditors of a buyer are most likely to compete with an unpaid seller of move-
ables.27 Further, the revendication remedy is not enforceable against any com-
peting secured or unsecured creditor of a buyer if that creditor has seized the
goods. While revendication may have an ostensible enforceability greater than
or equal to that of dissolution under article 1543 C.C.L.C. as regards other
potentially competing secured creditors of a buyer such as pledgees, commer-
cial pledgees and lessors,’
it is less effective than dissolution in the face of

23See text accompanying note 31.
24See Bankruptcy Act, supra, note 17, s.16(4); Deschamps, supra, note 17.
25See art. 734(4) C.C.P.
26See art. 604 C.C.P.
27See Boodman, “The Right of Retention of the Seller of Moveables in Quebec”, supra, note
1 at 660; Boodman, “The Prepaying Buyer of Corporeal Moveables in Quebec”, supra, note 1 at
925-26.

2sRevendication and dissolution are equally unenforceable vis-4-vis a buyer’s pledgee (see arts.
1966, 1968-1979 C.C.L.C.) insofar as the latter’s possession constitutes a breach of the possessory
requirements of the seller’s remedies. See text supra preceding note 15 and infra following note
32. Otherwise, dissolution despite its retroactive effect does not invalidate pledge or commercial
pledge (see arts 1979e-k C.C.L.C.) by a buyer to a third party or the privilege of the buyer’s lessor
(see arts 1637-40, 1994(8), 2005 C.C.L.C.). According to art. 1966a C.C.L.C. the nemo dat excep-
tions applicable to sale also apply to pledge and commercial pledge. See Boodman, “The
Prepaying Buyer of Corporeal Moveables in Quebec”, supra, note 1 at 901; A. Mayrand,
“Nantissement de ]a chose d’autrui” (1943) 3 R. du B. 313 at 313; C. Demers, Trait de Droit Civil

1989]

SELLER’S REVENDICATION REMEDY

future property secured creditors and any seizing creditor whether secured or
unsecured. As regards competing future property secured creditors and seizing
creditors, until the revendication remedy is brought to fruition by a judgment
ordering the return of the goods to the seller, it will be replaced by a preference
on judicial sale proceeds. If the remedy is completed, it has the effect of con-
serving the goods in the seller’s hands, pending his option for a final remedy.
However, this preservation of goods can equally be achieved by seizure before
judgment in the context of the dissolution remedy which is more widely
enforceable than the revendication remedy with all its modalities.

The practical advantages of the dissolution remedy over the revendication
remedy are clear. As illustrated above, in situations of competition between an
unpaid seller and his buyer’s creditors, revendication will likely result in a pref-
erence on judicial sale proceeds as opposed to return of the goods to the seller.
It is well known that a judicial sale generates far less than the market value of
goods.29 Further, the original seller of goods is best qualified, by virtue of his
professional link to the goods, to realize upon them through resale.
Consequently, where his buyer is insolvent or bankrupt a seller can minimize his
loss by regaining custody of the goods and reselling them. In a post-delivery
scenario, this can best be achieved through the dissolution remedy under article
1543 C.C.L.C.30

Even the preconditions for the exercise of the dissolution and revendication
remedies appear to favour dissolution. Both remedies are subject to a peremp-

du Quibec, vol. 14 (Montreal: Wilson & Lafleur, 1950) at 15-17; Ciotola, supra, note 2 at 63-64,
104; Caron, supra, note 10 at 407-09; R.A. Macdonald, “Exploiting the Pledge as a Security
Device” (1985) 15 R.D.U.S. 551 at 558; Goldstein, supra, note 1 at 102-03; Gotfredson Corp. v.
Filion (1928), 46 B.R. 52; Productions Michel Desrochers Inc. v. Bourbeau, [1983] C.S. 522;
P~troles Irving Inc. v. Machinerie B.D.M. Inc., [19841 C.S. 511; Bo-Less Inc. v. Boily (27
December 1979), Quebec 200-03-000192-770 (C.A.).
According to art. 1639 C.C.L.C., the lessor’s privilege applies inter alia to moveable effects
belonging to a third person if found on the leased premises. Assuming no seizure of the goods has
been initiated, the seller’s revendication remedy would be enforceable against a pledgee and com-
mercial pledgee on the basis of the ranking in art. 1994 C.C.L.C. which ranks sellers third and
pledgees fourth. The lessor’s privilege presupposes some form of seizure. Hence, it would never
compete directly with the seller’s revendication remedy.
As regards competition between a seller and a third party who purchases goods from the buyer see
text accompanying notes 33 & 34 regarding the possessory requirements of revendication and
disssolution.

29 See Macdonald in Springman & Gertner, eds, supra, note 1 at 351; J.T. Robertson, “The
Problem of Price Adequacy in Foreclosure Sales” (1987) 66 Can. Bar Rev. 671 as regards judicial
sale of immoveables.

30 1n a pre-delivery scenario, resale by a seller can be achieved without court intervention by
means of the combination of the right of retention under arts 1946 and 1497 C.C.L.C., dissolution
under art. 1544 or 1065 C.C.L.C., and art. 1027, para. 2 C.C.L.C. For an analysis of this situation
see Boodman, “The Right of Retention of the Seller of Moveables in Quebec”, supra, note 1 at
702-04.

REVUE DE DROIT DE McGILL

[Vol. 35

tory thirty-day delay in the case of a buyer’s insolvency or bankruptcy3 and
require that the goods be physically identifiable and unchanged.32 These reme-
dies’ pre-conditions differ, however, in three respects. The first concerns a
requirement that no third party have possession of the goods. In the context of
article 1543 C.C.L.C., dissolution can only be exercised “while the thing sold
remains in the possession of the buyer”. Any loss of possession by him extin-
guishes the right. Article 1999(3) C.C.L.C. states that the right of revendication
is subject to the condition that the thing “not have passed into the hands of a
third party who has paid for it”. Accordingly, both third party payment and pos-
session are required in order to extinguish the right.33 Consequently, the reven-
dication remedy is less likely to be extinguished than dissolution on the basis
of third party possession.’

This potential slight edge in favour of revendication, however, is greatly
reduced by the effect of article 1999(1) and (4) C.C.L.C. These provisions sub-
ject revendication to the conditions that the sale not have been made on credit
or with a term, and that the remedy be exercised within eight days of delivery
in non-insolvency situations. If either of these conditions is unfulfilled the
revendication remedy is forfeited and transformed into a privilege ranked lower
than that otherwise accorded an unpaid seller.35 Dissolution under article 1543
C.C.L.C., on the other hand, is not subject to any such restrictions? 6

31See arts 1543, para. 2, 1998, para. 2 C.C.L.C.; Mercure v. Philippe Beaubien & Cie (1965),
[1966] B.R. 413; Re Beatrice Pines Ltd.: Vendome Knitting Mills Ltd. v. Lawrence, supra, note 17;
Re Dame Talbot: Antaya v. de Cotret (1957), [1958] C.S. 239; Re lberville Furniture and
Appliances Co.: Grobstein v. Facto, supra, note 17.
32This is expressly required under art. 1999(2) C.C.L.C. as regards the seller’s revendication
remedy and implied in the dissolution remedy which subsumes a revendication remedy by the
seller as owner. See Macdonald in Springman & Gertner, eds, supra, note 1 at 306, 341, 333;
Pourcelet, supra, note 1 at 173; Rousseau-Houle, Pricis diu droit de la vente et diu louage, supra,
note 1 at 201,206; Ciotola, supra, note 3 at 170-7 1; Macdonald & Simmonds, supra, note 2 at 262;
Macdonald, supra, note 4 at 629-31; Mechanic Supply Co. v. Hudon (1933), 71 C.S. 400; Mercure
v. Philippe Beaubien et Cie, ibid.; Roy v. Bois Ste-Lucie Inc., [1977] C.S. 845.
33See Macdonald & Simmonds, ibid. at 262-63, LeDain, supra, note 10 at 81; C. Demers, Traitj
de droit civil du Qudbec, vol. 14 (Montreal: Wilson & Lafleur, 1950) at 131; Boodman, “The
Prepaying Buyer of Corporeal Moveables in Quebec”, supra, note 1 at 896-97; Macdonald in
Springman & Gertner, eds, ibid. at 306; Mechanic Supply Co. v. Hudon, ibid.

-4The possessory requirements for dissolution under art. 1543 C.C.L.C. and for revendication are
intended to protect third parties who purchase goods from a buyer by limiting or eliminating a sel-
ler’s right to follow. There is no apparent reason for the distinction between these requirements.
See Patterson v. Baldwin (1894), 8 C.S. 513. The distinction is all the more anomalous given the
historical basis for the seller’s revendication remedy analysed later in this paper.

35See art. 2000(2) C.C.L.C.
36A term for payment in favour of a buyer prevents the exercise of revendication and dissolution
remedies alike insofar as it delays performance and possible breach of the buyer’s obligation to
pay the purchase price. Assuming such breach to have occurred, thereby giving rise to a seller’s
remedies for non-payment, art. 1999(1) C.C.L.C. constitutes a superadded restriction against reven-
dication, one which is not applicable to dissolution under art. 1543 C.C.L.C.

1989]

SELLER’S REVENDICATION REMEDY

Within an economic analysis, revendication and dissolution are equally
efficient or inefficient, as the case may be. As a custodial or repossessory rem-
edy, revendication, like dissolution which entails repossession based on owner-
ship, appears to undermine the collective debt collection process of bankruptcy
and the goal of keeping firm or buyer specific assets together where necessary
to maximize their value.37 However, valuation considerations combined with the
technical rules regarding a seller’s non-consensual remedies indicate that the
collective process will remain intact where this is an efficient result despite
either revendication or dissolution by a seller.

Whether before or after a buyer’s bankruptcy, a seller will exercise a rem-
edy other than a preference on judicial sale proceeds only if the value of the
goods in his hands is greater than their judicial sale or liquidation value, i.e.
their value in the hands of the buyer-debtor or his trustee in bankruptcy, which
in turn is less than the seller’s claim. Similarly, a debtor or debtor’s trustee in
bankruptcy will want to restrict the seller’s remedy to a preference on judicial
sale proceeds only if the value of the goods in the debtor’s hands is greater than
the seller’s preferred claim.3″ Both of these scenarios have the effect of maxi-
mizing the value of a debtor-buyer’s assets vis-a-vis the reduction of claims
upon bankruptcy. Further, these two scenarios are mutually exclusive in that
goods will likely not be buyer specific and non-buyer specific at the same
time.

39

Technically, the revendication remedy appears to be more sensitive than
dissolution to efficiency considerations. Revendication is not enforceable
against third party seizures or a buyer’s trustee in bankruptcy.”n Exercise of the
remedy by a seller on the eve of a buyer’s bankruptcy will not itself prevent
recovery of the goods by the buyer’s trustee in bankruptcy if it is desirable to
do so. By contrast; the dissolution remedy creates an absolute bar to recovery.41
However, from an efficiency point of view, a trustee in bankruptcy’s ability to
recover goods will be the same whether revendication or dissolution is a seller’s
basis for repossession. This results from the mutual exclusivity of scenarios
favouring repossession by a seller or the collective process of liquidation. Even
if a seller has dissolved the sale of buyer specific goods and has thereby created
an absolute bar to recovery by a trustee in bankruptcy, their buyer specific
nature is incentive for a seller to return the goods or resell them to the buyer to

37See T.H. Jackson, The Logic and Limits of Bankruptcy Law (Cambridge: Harvard University

Press, 1986) at 5, 10-19, 103-04, 139-42.

38See Jackson, ibid. at 140.
39The only instance in which both a seller and a buyer’s trustee in bankruptcy will want to
recover goods will be where they are goods that appreciate rapidly in value, such as gems or orig-
inal works of art. In this case, the appreciating value of the goods sold ensures that a seller’s pref-
erence on judicial sale or liquidation proceeds will satisfy his claim.

40See text accompanying notes 21-24.
41See text accompanying note 17.

McGILL LAW JOURNAL

[Vol. 35

maximize their realizable value and the seller’s own preferred claim. The tech-
nically absolute enforceability of dissolution does not reflect completely, but
neither does it remove, the economic realities of a seller’s claim in bankruptcy.
In fact, the existence and preeminence of the seller’s dissolution remedy over
that of revendication reflects the greater probability that goods are worth more
in the hands of a seller than in the hands of a buyer’s trustee in, bankruptcy 42 and
supports a bias, perhaps erroneously, in favour of the non-consensual, secured
status of a seller of moveables.43

The result is that revendication and dissolution are identical remedies from
the perspective of economic efficiency.” This indicates that there is no clear
efficiency justification to sustain the revendication remedy which, as shown
above, is otherwise superfluous under the technical rules for security on move-
ables in Quebec.

Having established the inferior status of the seller’s right of revendication
as regards its availability and enforceability, the question to be resolved is why
and how does the remedy exist in the law of Quebec. The answer resides in the
requirement under article 1999(1) C.C.L.C. that sale not be made on credit and,
to a lesser degree, in the requirement under article 1999(4) C.C.L.C. that the
remedy be exercised within eight days of delivery. These provisions indicate
that the seller’s revendication remedy is an error of codification and has no
meaningful existence in the present law of Quebec with the practical result that
after delivery a seller has only a dissolution remedy or lower ranked preference
on judicial sale proceeds.

H. Historical Analysis of Article 1999(1) and (4) C.C.L.C.

As a preliminary observation, it must be stated that this historical analysis
is intended to indicate the pre-codification legal bases for the rules in article
1999(1) and (4) C.C.L.C. An examination of the origins of these rules provides
a critical understanding of their transposition into the post-codification law of
Quebec. The analysis is not intended to be a full socio-legal, historical exami-
nation. Hence, no attempt will be made to situate the precursors to article
1999(1) and (4) C.C.L.C. in their greater historical context.

The examination of the origins of article 1999(1) and (4) C.C.L.C. shall

take place in the context of the Codifiers’ sources and Roman law.

42See text accompanying note 29.
43See text accompanying notes 231-34.
4IThe identity of revendication and dissolution in economic terms accurately reflects the histor-

ical origins of revendication. See text accompanying notes 45ff.

1989]

SELLER’S REVENDICATION REMEDY

1. Codifiers’ Sources

In the Codifiers’ Reports,45 the present article 1999 C.C.L.C. is article 23b
of Title Seventh: Of Privileges and Hypothecs, Chapter Second: Of Privileges,
Section I: Of Privileges upon Moveable Property.46 The Codifiers’ Sixth Report
contains no specific commentary upon article 23b. Their observations regarding
article 17 to 34a of Section I: Of Privileges upon Moveable Property are as
follows:

Such are the rules according to which the order of privileges has been established
in article 17, of which the subsequent articles are a mere development requiring
no remark. 47

Hence, the primary clues as to the bases for the rules in article 23b(1) and
(4) are the sources mentioned by annotation to the French version of article
23b.4

‘ This annotation reads as follows:

Ferri~re, sur art. 176, no 19. –
Priv. nos 194, 195, 196, 197.-

2 Bourjon, 689.-
Tropl.
2 Tropl. Vente, p. 531. – Code, Louage art. 21.

4 Anc. Den. 377-8 –

For several reasons, extracts from some of these sources are reproduced at
length insofar as they relate to the rules that limit revendication to sale without
a term and to the period of eight days following delivery. First, these sources
are rare 18th and 19th Century treatises which are not generally available for
consultation.49 Second, as will be seen, the words used by the authors cited by
the Codifiers leave no doubt as to the pre-codification bases for the rules under
scrutiny here. Finally, the actual sources for the codification of article 23b pro-
vide insight and raise serious questions as to the methodology and framework
used by the Codifiers.

It is evident from the sources of article 23b and the annotation to the
French version of article 23, the precursor to article 1998 C.C.L.C. which estab-
lishes the unpaid seller’s right of revendication and privilege on judicial sale
proceeds,5″ that the revendication remedy derives in part from articles 176 and
177 of the Coutume de Paris. Article 176 reads:

45Civil Code of Lower Canada (Quebec: George E. Desbarats, 1865).
461bid., Sixth and Seventh Reports and Supplementary Report, Sixth Report at 163 as amended
by the Supplementary Report at 383. The title, chapter and section are identical to those in the pres-
ent Civil Code of Lower Canada.

which is irrelevant for present purposes. See ibid.

471bid. at 54. There is a separate commentary on art. 29 regarding the expenses of the last illness
48Ibid. at 162.
491 would like to thank the Law Library of the Faculty of Law, McGill University for access to

its Wainwright Collection.

5See Civil Code of Lower Canada, supra, note 45, Sixth Report at 162.

REVUE DE DROIT DE McGILL

[Vol. 35

Qui vend aucune chose mobiliaire sans jour et sans terme, esp6rant 6tre pay6
promptement, il peut sa chose poursuivre, en quelque lieu qu’elle soit transport~e,
pour 8tre pay6 du prix qu’il ‘a vendue.

Article 177 reads:

Et n6anmoins encore qu’il efit donn6 terme, si la chose se trouve saisie sur le d6bi-
teur par autre cr6ancier peut empecher la vente; & est pr6f6r6 sur la chose aux
autre cr6anciers.

Ferri~re, commenting upon the phrase “sans terme, esp6rant 8tre pay6
promptement” in article 176 as a condition to revendication notwithstanding
seizure by a third party, states:

… la raison est qu’en ce cas ]a chose vendue quoique livr6e, n’est pas parvenue
dans le domaine de l’acheteur et par cons6quent les cr6anciers n’y peuvent pr6ten-
dre aucun droit au pr6judice du vendeur autrement ils s’enrichiraient de ces biens
contre l’6quit6 naturelle.5

1

His comment on the phrase “sans jour et sans terme” is as follows:

Au contraire, si le premier vendeur sans jour et sans terme avoit laiss6 passer quel-
que temps, comme de sept A huit jours au plus, ce qui d6pend des circonstances
et de la prudence du juge sans avoir poursuivi l’acheteur, ou pour le prix convenu,
ou pour reprendre sa chose faute de paiement, et que cet acheteur l’eit revendue;
sans doute que le premier vendeur n’auroit pas droit de suit A rencontre du second
acheteur, parce qu’il seroit pr6sum6 avoir tacitement suivi ]a foi de l’acheteur et
ainsi la propri6t6 de la chose auroitpass6e en la personne de cet acheteur, laquelle
auroit pu transfdrer A une autre…. 5

T

Further, Ferri~re states:

Le vendeur ayant donn6 tems 4 l’acheteur pour le paiement, il a suivi la foi et il
a par ce moyen transf6r6 la proprid6t de la chose en sa personne, en sorte que ds
ce meme tems, il peut la vendre, l’6changer ou l’engager avec entier slret6 pour

les acqu6reurs d’icelle…53
Bourjon 4 makes the following commentaries regarding the requirement in
article 176 that the sale be made “sans jour et sans tenne, esp6rant etre pay6
promptement”:

LXXXV – Le droit de revendiquer la chose cesse, si le vendeur a donn6 terme,
et il ne peut empacher la vente de la chose; parce que l’acheteur en est devenu pro-
prid6taire puisqu’en ce cas la vente et ‘achat ont 6t6 parfaits; mais il a un privilege
sur le prix provenant d’icelle; c’est A ce privilege en ce cas auquel se r6duit son
droit; privilege fond6 sur ce que c’est le cr6dit qu’il a fait qui a mis l’effet parmi

(Paris: Librairies associ6es, 1788) at 407.

51See C. de Ferrire, Commentaire sur la Coutume de la Privotj et Vicomtd de Paris vol. I
521bid. at 410.
531bid. at 411.
-54F. Bourjon, Le droit commun de la France et la coutume de Paris rduits en principes, vol.

2 (Paris: Grange, Cellot, 1770) at 688.

19891

SELLER’S REVENDICATION REMEDY

les biens du d6biteur: il a donc 6t6 juste de lui accorder un privil~ge sur le prix
d’icelui; c’est raison 6crite, c’est droit commun.
LXXVI – Lorsqu’il a vendu sans jour et sans terme, esp6rant 8tre pay6 promp-
tement, il peut emp~cher la vente et revendiquer la chose; dans ce cas-ci, son pri-
vilfge est plus 6tendu que dans I’autre; l’imperfection de la vente, imperfection
qui est constante en ce cas, fonde ce second privilege.
LXXVII – Cette distinction a cependant juste base: elle est fond6 sur ce que
l’acheteur ne devenoit propri6taire d’icelle que sous une condition, qui dtoit de
payer le prix; condition qu’il n’a pas rempli, et qui a par cons6quent laiss6 la con-
vention imparfaite et incapable de transf6rer la propridt6 de la chose.
LXXVIII – Mais ce droit est sujet A une forme: pour exercer ce droit de reven-
dication, il faut que le vendeur agisse incontinent et au plus tard dans la huiti~me
de la livraison, si le vendeur et acheteur sont demeurais en m~me ville; apr~s
lequel tems, il auroit fin de non-recevoir, parce que la juste pr6somption est en ce
cas, que la vente n’a pas 6t6 faite sans jour et sans terme, qu’un plus long d61ai
auroit 6t6 pr6judiciable au commerce; et apr~s ce dM1ai, il n’y a plus que le privi-
l6ge sur le prix, et non le droit de revendiquer, qui subsiste en faveur du vendeur,
qui n’est plus regard6 en ce cas comme vendeur sans jour et sans terme.
Troplong55 makes the following comments upon the conditions that the sale
be made “sans terme” and that revendication be exercised within eight days of
delivery:

Si la vente est faite avec terme, alors le vendeur ayant suivi la foi de l’acqu6reur,
ne peut exercer la revendication. I1 faut que la vente soit faitfidg graeca, c’est- –
dire A deniers comptans. Car les Grecs ne faisaient point de cr6dit, et on n’avait
rien chez eux que l’argent t la main.56
On suppose que s’il s’6coulait plus de huit jours sans r6clamation, le vendeur
aurait suivi la foi de I’acqudreur, et que, d~s lors, ce demier serait devenu propri6-
taire.57

Dans l’ancienne jurisprudence le dM1ai pour l’exercice de la revendication n’6tait
pas fix6, en sorte que l’on disputait beaucoup pour savoir quel laps de temps devait
s’6couler afin de juger si le vendeur avait voulu accorder tacitement un d6lai de
grace, et suivre la foi de l’acheteur. 58
It is clear from the doctrinal sources cited by the Codifiers that in pre-
codification French law the unpaid seller’s revendication remedy was based on
the concept of ownership, the remedy being available only so long as ownership
did not pass to the buyer. The transfer of ownership to a buyer upon delivery
required payment of the purchase price unless the seller expressly or impliedly
waived the condition or extended credit. Express waiver would occur where a
seller gave his buyer a term for payment. Waiver would arise by implication if
the seller’s behaviour upon delivery indicated that he did not expect to be paid
promptly, for example by not pursuing his buyer either for the price or for return

55M. Troplong, Le droit civil expliqu, vol. I (Paris: Charles Hingray, 1833).
56Ibid. at 286.
57Ibid. at 288.
58Ibid. at 288-89.

McGILL LAW JOURNAL

[Vol. 35

of the goods with enough celerity. The lapse of time necessary for implied
waiver of payment appears to have depended upon the circumstances, with eight
days as the outside limit. It is not clear from the Codifier’s sources that pre-
codification French law in all cases permitted a seller to wait eight days before
exercising a remedy. In fact, as suggested by Ferri~re and Troplong, the caselaw
was uncertain in this regard59 and according to Troplong the uncertainty was
remedied by codification of an eight-day rule in France.’ Further, Troplong, in
a passage not cited by the Quebec Codifiers,6′ indicates that prior to codifica-
tion, delivery by a seller without an immediate and express demand for payment
constituted waiver or the extension of credit. This is in contradistinction to
Pothier62 who states that the extension of credit is not presumed and arises tac-
itly only with the lapse of a considerable time after delivery without a demand
for payment by a seller.

The rules for revendication as enunciated by the Codifier’s doctrinal
sources are unclear and paradoxical as regards the extension of credit by impli-
cation. First, there is a discrepancy as to the exact formality required of a seller
to preserve ownership of goods delivered and, hence the revendication remedy.
Ferri~re63 and Bourjon 4 seem to indicate that a seller must institute legal pro-
ceedings. By contrast, Troplong’ suggests that a mere demand for payment will
suffice.

The ultimate difficulty is that neither of these proposed solutions is truly
satisfactory. The institution of legal proceedings in revendication is unsatisfac-
tory because of the logical framework of the remedy. It is tautological to require
that the remedy be exercised within a certain delay in order to negate a transfer
of ownership based on an implied extension of credit and thereby preserve the
remedy. It is submitted that this is logically and substantively different from
peremptory delays for the exercise of remedies such as those regarding the
unpaid seller’s dissolution and privileged remedies in a modem context.66 The
institution of proceedings to recover the purchase price as suggested by Ferri~re
contradicts the revendication remedy and cannot be a means of preserving it. On
the other hand, an informal demand for payment would be meaningless as a
legal mechanism to preserve the revendication remedy. It would lead to either
complete preservation of the remedy through simulated demands for payment or
complete elimination of the remedy every time delivery is made without an

5 9See text accompanying notes 52 and 58.
60See art. 2102(4) C.N.; Troplong, supra, note 55 at 289.
6 1See Troplong, ibid., paras. 189, 190.
62See M. Bugnet, Oeuvres de Pothier, 3d ed., vol. 3 (Paris: Marchal & Billard – E. Plon,
6 3See text accompanying note 52.
64See text accompanying note 54, para. LXXVIII.
65See text accompanying notes 56, 57.
66See arts 1543, 1998 C.C.L.C.

Nourrit et cie., 1890) para. 324.

1989]

SELLER’S REVENDICATION REMEDY

immediate demand. The latter results from the informal nature of the require-
ment which implies that a short lapse of time would suffice to create a presump-
tion that a seller has extended credit.67

These difficulties with the rules enunciated by the doctrinal sources cited
by the Quebec Codifiers can be explained and perhaps resolved by considera-
tion of the Roman law rules regarding the transfer of ownership of moveables.

2. Roman Law

An examination of the rules for the transfer of ownership of moveables by
delivery in Roman law illustrates vis-h-vis the pre-codification French law some
of the risks associated with the adoption of ancient laws outside their original
context.

The post-classical Roman law regarding the transfer of ownership as reg-
ulated by the Institutes of Justinian is the culmination of entrenched Roman
formalism and a gradual process of liberalization. According to the Institutes,
the transfer of ownership of moveables occurs upon delivery (traditio) if one of
three conditions is fulfilled:

(i) payment of the purchase price upon delivery;
(ii) the provision of adequate security by the buyer in lieu of payment;

or

(iii) the granting of credit by the seller.6″

In keeping with the historicism and classicism of Justinian’s Corpus Iuris
Civilis, these rules for transferring ownership upon delivery represent separate
stages in the development of Roman law.69

67Pothier also suggests an informal demand for payment as the requirement for preservation of
the remedy. He suggests, however, that the requirement that this demand be made immediately
upon delivery would engender too great a presumption of credit. See text accompanying note 62.
6sSee P. Cumin, A Manual of Civil Law, 2d ed. (London: Stevens & Sons, 1865) at 91 regarding
Book II, Title I, no. 41 of the Institutes of Justinian. The first two conditions regarding price and
security are based upon the phrase “…venditae vero et traditae non aliter emptori adquiruntur,
quam si is venditori pretium solverit vel alio modo ei satisfecerit…”. The condition regarding credit
is based upon the phrase “Sed si is qui vendiditfidem emptoris secutasfuerit, dicendum est statim
rem emptorisfieri.” See also P.F. Girard, Manuel glimentaire de droit romain, 8th ed. by F. Senn
(Paris: Librairie Rousseau, 1929) at 312-13; B. Nicholas, An Introduction to Roman Law (London:
Oxford University Press, 1965) at 179; W.W. Buckland, A Text-Book of Roman Law, 2d ed.
(Cambridge: Cambridge University Press, 1932) at 230, 240, 493; M. Alter, L’obligation de dili-
vrance dans la vente des meubles corporels (Paris: L.G.D.J., 1972) at 11; P. Ourliac & J. De
Malafosse, Histoire du droit privi, 2d ed., vol. 1 (Paris: Presses Universitaires de France, 1969)
at 34-36, 273-74; D. Pugsley, The Roman Law of Property and Obligations (Cape Town: Juta,
1972) at 87-90; M. Kaser, Roman Private Law, 3d ed., trans. R. Dannenbring (Pretoria: University
of S. Africa, 1980) at 127-29.

69See Buckland, ibid. at 230 n. 8; Girard, ibid.; Ourliac & Malafosse, ibid.; Kaser, ibid.

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The first rule, that ownership transfers by delivery if the price is paid,
reflects the classical rule according to which simultaneous reciprocal execution
was necessary for synallagmatic contracts to have their full legal effect.” It also
reflects the formalism of the ancient process of mancipatio, a pre-currency pre-
cursor to the contract of sale.7′ Mancipatio was a complex ceremony for the
transfer of ownership held before five witnesses in which the parties to the con-
tract spoke solemn words and a libripens weighed bronze ingots to be paid to
the transferor as the price.72

It is not certain whether the provision of security in lieu of payment
included both personal suretyship and real security. Nonetheless, this pre-
condition to the transfer of ownership was intended to be an equivalent to pay-
ment of the price. In fact, it is described in the Institutes in terms of “satisfying”
the seller as to the price.73 It has been suggested that the provision of security
in this context was accomplished through the formal mechanism of stipulatio.74
This condition, too, relates to the formalism of mancipatio.

The third condition, the granting of credit to the buyer, is the furthest
removed from the concept of payment and the latest chronologically.75 It is often
described in terms of the seller “putting his faith” in the buyer76 and indicates
that the seller renounces his right to payment upon delivery, the condition for
the transfer of ownership. By granting credit, a seller accepts in exchange for
the transfer of ownership the constitution of a personal debt owed by the buyer
as security for payment of the price. While this would appear to bring the
Roman law close to a consensual transfer of ownership, it seems that the giving
of credit in this context was not merely the granting of a term, but consisted of
a formal stipulation by which the seller accepted the debt in lieu of payment.77

7 See Kaser, ibid. at 200-02; Faribault, supra, note 2 at 20; Rousseau-Houle, Pricis de droit de
la vente et de louage, supra, note I at 11; H. Brun, “Les origines du consensualism en matire de
transfert de propri6t6 et des mitigations apportdes au principe par le droit civil qu~b~cois”
(1967-68) 9 C. de D. 273 at 274-75; D. Jacoby, “Le transfert contractuel de propri6t6 dans une per-
spective de r6forme” (1970) 5 R.J.T. 65 at 69-70; JJ. Gow, “Conveyance of Title in the Sale of
Corporeal Moveables” (1967) 13 McGill L.J. 244 at 246-47.

at 313 n. 3; Bugnet, supra, note 62, para. 322.

71See Buckland, supra, note 68 at 231, 240 n. 2; Kaser, ibid. at 126, 210.
72See P. Ourliac & J. de Malafosse, Histoire d droit privd, vol. 2, 2d ed. (Paris: Presses
Universitaires de France, 1971) at 277-81; Girard, supra, note 68 at 308-09, Buckland, ibid. at
235-38; Kaser, ibid. at 45-47; Pugsley, supra, note 68 at 4-7.
73See text cited supra, note 68 regarding “vel alio modo ei satisfecerit.” See also Girard, ibid.
74See Kaser, supra, note 68 at 49-51, 128, 206-09.
75Girard, supra, note 68; Kaser, ibid. at 129; Pugsley, supra, note 68 at 89.
76The exact wording of the Institutes isfidem emptoris secutusfiterit. See text cited supra, note
68. See also Girard, ibid.; Ourliac & Malafosse, supra, note 68 at 274; Bugnet, supra, note 62,
para. 324.
77See Troplong, supra, note 55 at 278; Bugnet, ibid. at 135 n. 1. The reliance on the “faith” of
the buyer seems to indicate the use of fides in this context. Fides was the creation of a debt and

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SELLER’S REVENDICATION REMEDY

Despite the many uncertainties associated with the analysis of laws of
antiquity, it seems clear that the transfer of ownership by delivery in Roman law
did not arise by the implied giving of credit or a term for payment. Roman form-
alism combined with the importance of price in the transfer of ownership during
and after the reign of Justinian7 indicate that if the price was not paid upon
delivery a formal agreement for security or credit in lieu of payment was nec-
essary to transfer ownership. This rule, however, was not transposed faithfully
into the pre-codification French law regarding revendication outlined above.
The possibility for a seller “to follow the faith” of a buyer by implication, as
opposed to formal stipulation, greatly reduced the extent of Roman law formal-
ities for the transfer of ownership upon delivery. The result is a two-fold para-
dox. From a remedial perspective, the transfer of ownership by means of
implied credit eliminates the seller’s revendication remedy without providing
adequate security for payment of the purchase price.” In the context of translat-
ory contracts, the transfer of ownership by means of implied credit undermines
the formalism otherwise inherent in the Roman concept of sale.

This limited historical analysis indicates that the pre-codification French
law sources of article 1999(1) and (4) C.C.L.C. reflect a position somewhere
between Roman formalism and post-codification consensualism. As regards the
transfer of ownership and seller’s revendication remedy, the mix of components
from both extremes appears not to work. In fact, the development of the rule
that credit is presumed only if the seller has taken no action eight days after
delivery seems to be an attempt to mitigate the paradox described above. Given
this historical background and the internal inconsistencies of the Codifiers’
sources, it is now appropriate to consider the transposition of the rules in article
1999(1) and (4) C.C.L.C. to a modem context –
a context exemplified, for
present purposes, by the consensual nature of the transfer of ownership of
moveables in sale.

.II Modern Analysis of Article 1999(1) C.C.L.C.

As can be seen from the first part of this paper and by implication from the
historical analysis, the intelligibility of the unpaid seller’s revendication remedy
in a modem context is intimately linked with the civil law notion of a “term”
or “credit”. In this part, the notions of express and implied terms as well as the
role of mise en demeure shall be considered in the context of article 1999(1)

was originally based on faith and social pressures rather than legal sanctions. It later became
legally enforceable as constitutum. See Ourliac & Malafosse, ibid. at 17, 35, 44; Bugnet, ibid.;
Buckland, supra, note 68 at 422, 529-31; Kaser, supra, note 68 at 210, 235.
78See Alter, supra, note 68, para. 4; Buckland, ibid. at 230 n. 8; Ourliac & Malafosse, ibid., para.
247.79This paradox is recognized by Nicholas and Pugsley as regards the formal notion of credit in
Roman law and by Pothier as regards credit by implication in pre-codification French law. See
Nicholas, supra, note 68 at 179; Pugsley, supra, note 68 at 90; Bugnet, supra, note 62, para. 324.

McGILL LAW JOURNAL

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C.C.L.C. in order to determine their effect upon the seller’s remedy and ulti-
mately to show that the remedy cannot exist in its present state. It must be
emphasized that this analysis of article 1999(1) C.C.L.C. in a modem context
is distinct from the preceding examination of the historical sources of the sel-
ler’s revendication remedy. Despite the historicism inherent in codified rules of
law, in this part of the paper it is intended to show that the revendication remedy
is meaningless on its own terms in post-codification law. Before doing so, how-
ever, the reasons for a strictly modem interpretive framework are explained.

1.

Interpretive Framework for Modern Analysis

For the purposes of this paper, that is to show that the seller’s revendication
remedy has no meaningful existence, an analysis of article 1999(1) C.C.L.C.
must be restricted to a modem context owing to methodological and substantive
reasons. The methodological reasons relate to the uncertainty in Quebec as to
the use of historical sources in cQdal interpretation. The substantive reasons
indicate that an historical analysis of article 1999(1) C.C.L.C. is neither useful
nor warranted to explain the modem codified rule. These reasons for a modern
interpretive framework, particularly the methodological reasons, are described
in detail because they elucidate how the perception of codified rules of law can
permit a defunct mechanism such as the seller’s revendication remedy to
endure.

From a methodological point of view, there are two opposing opinions, one
permissive, the other restrictive, as to whether recourse to the Codifiers’
Reports and pre-codification law is a proper interpretive technique. The contro-
versy results from conflicting codal and statutory provisions regarding the scope
and application of the Civil Code of Lower Canada.

The mandate of the Codifiers was, inter alia, (i) to reduce into codal form
the laws of Lower Canada then in force relating to civil matters and of a general
and permanent character; (ii) to provide the authorities upon which the
Codifiers relied as to what the law in force in Lower Canada was; and (iii) to
suggest amendments to the existing laws of Lower Canada separately and dis-
tinctly supported by reasons.” Thus, the Civil Code of Lower Canada combines
both pre-codification rules of law and amendments to those rules, each of which
can be identified by reference to the Codifiers’ Reports.”‘ The Codifiers’

8See An Act to provide for the Codification of the Laws of Lower Canada relative to Civil mat-
ters and Procedures, 20 Vict., S.C. 1857, c.43 ss. 4, 6. See also J.E.C. Brierley, “Quebec’s Civil
Law Codification Viewed and Reviewed” (1968) 14 McGill L.J. 521 at 542-54, 565-73; FR
Walton, The Scope and Interpretation of the Civil Code of Lower Canada (Toronto: Butterworths,
1980) at 85; M. Tancelin, “Introduction” in F.P. Walton, at 7; P-B. Mignault, Le droit civil cana-
dien, vol. 1 (Montreal: Whiteford & Th6oret, 1895) at 48-49.

81The amendments to the pre-codification law are designated by square brackets in the Civil

Code of Lower Canada.

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SELLER’S REVENDICATION REMEDY

Reports also indicate the legal sources of the pre-codification rules which were
reduced into codal form.

The permissive theory of interpretation recognizes the importance and rel-
evance of the Codifiers’ Reports and pre-codification law as interpretive aids for
the Civil Code of Lower Canada. This theory is given support by article 2712
C.C.L.C., formerly article 2613 C.C.L.C.12 Article 2712 C.C.L.C. states:

The laws in force at the time of the coming into force of this code are abrogated
in all cases:
In which there is a provision herein having expressly or impliedly that effect;
In which such laws are contrary or inconsistent with any provision herein
contained;
In which express provision is herein made upon the particular matter to which
such laws relate;
Except always that as regards to transactions, matters and things anterior to the
coming into force of this code, and to which its provisions could not apply without
having a retroactive effect, the provisions of law which without this code would
apply to such transactions, matters and things remain in force and apply to them,
and this code applies to them only so far as it coincides with such provisions.

The implication of article 2712 C.C.L.C. is that the pre-codification laws
of Lower Canada are still in force in Quebec to the extent that they have not
been repealed expressly or impliedly by the Civil Code of Lower Canada, are
not inconsistent with its provisions and do not relate to a subject matter
expressly regulated by the Code. While the precise extent to which the former
law is still in force may be impossible to determine other than on a case-by-case
basis, 3 article 2712 C.C.L.C. indicates a three-fold necessity for reference to
pre-codification laws via the Codifiers’ Reports.

First, unless a provision of the Civil Code of Lower Canada is new law as
expressly indicated by brackets in the official edition, it is impossible to deter-
mine if a particular pre-codification law is still in force according to article 2712
C.C.L.C. unless that law is examined and compared to its modem codal coun-
terpart.’ Second, if particular pre-codification rules are held not to have been
repealed by codification, these rules must be interpreted and applied. Finally,
even if the pre-codification laws of a particular subject matter have been
repealed according to article 2712 C.C.L.C., the interpretation of the present
codal provision can be enhanced by comparison with the former law. This is
particularly true because repeal under article 2712 C.C.L.C. occurs not only

82Art. 2613 C.C.L.C. became art. 2712 C.C.L.C. in virtue of An Act respecting Insurance, S.Q.

1974, c.70, s.466 which came into force on October 20, 1976, G.O.Q. 1976 11.5941.

83E.g. Lapierre v. A.G. Quebec, [1985] 1 S.C.R. 241 at 257-59, 16 D.L.R. (4th) 554,32 C.C.L.T.
233, Chouinard J.; Dame B. v. D. (1941) 71 B.R. 469 at 474; Masson v. Solomon (1935) 73 C.S.
196; L. Baudouin, “Mthode d’interpr6tation judiciaire du Code civil du Quebec” (1950) 10 R. du
B. 397 at 403.

84See Masson v. Solomon, ibid. at 197-98.

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when a present provision is inconsistent with a past rule, but also when the pres-
ent and past rules coincide as to subject matter. Therefore, the terms of article
2712 C.C.L.C. and the mandate of the Codifiers justify some reference to the
Codifiers’ Reports and pre-codification law when interpreting the Civil Code of
Lower Canada, particularly if a provision is ambiguous. In fact, this appears to
be a growing tendency.”

The second and opposing view that the Codifiers’ Reports should not be
consulted when interpreting the Civil Code of Lower Canada is based on spe-
cific and general rules of statutory interpretation. The most persuasive specific
rule is that found in section 1 of An Act respecting the Civil Code of Lower
Canada,86 the statute which gave the newly codified rules the force of law. This
provision states, inter alia:

…the marginal notes and the references to existing laws or authorities at the foot
of the several articles of the said Code, shall form no part thereof, and shall be held
to have been inserted for convenience of reference only…

The argument is that except for the texts of the codal provisions them-
selves, neither the Codifiers’ Reports nor the sources cited by the Codifiers have
the force of law and should not be part of the interpretive process.” The argu-
ment is cogent in that it imposes a textual limit to interpretation of the Code
without which an infinite regression of interpretation of sources would occur.
This is consistent with the general rules of statutory interpretation according to
which except for a preamble,” marginal notes and other travaux prparatoires
are not part of the interpretive process. 89

The point of this second view is that only the actual texts of law should be
interpreted and applied. While this is true if a text is clear and unambiguous, it

85See Tancelin, supra, note 80 at 19; P.-A. Ct6, The Interpretation of Legislation in Canada
(Cowansville: Yvon Blais, 1984) at 10, 332-33; Lapierre v. A.G. Quebec, supra, note 83; L.
Baudouin, “Originalit6 du droit du Quebec” (1950) 10 R. du B. 121 at 132; S. Normand, “Les tra-
vaux pr6paratoires et l’interpr~tation du Code civil du Qudbec” (1986) 27 C. de D. 347; J.-L.
Baudouin, “L’Interpr~tation du Code civil qu6b6cois par Ia Cour supreme du Canada” (1975) 53
Can. Bar Rev. 715 at 730-31; A. Popovici, “Dans quelle mesure ]a jurisprudence et la doctrine
sont-elles source de droit au Qu6bec” (1973) 8 R.J.T. 189 at 197-98; Elite Kosher Caterers Inc.
v. Karmazyn, [1973] R.L.n.s. 118 (C.P.); Royal Victorial Hospital v. Morrow (1973), [1974] S.C.R.
501 at 505, 42 D.L.R. (3d) 233; Cie Immobiliere Viger v. L. Giguere Inc. (1976), [1977] 2 S.C.R.
67, 10 N.R. 277.

86S.L.C. 1865, c.41.
87See Brierley, supra, note 80 at 525; Tancelin, supra, note 80 at 18-20; L.-P. Pigeon, Ridaction
et interpretation des lois, 2d ed. (Quebec: tditeur officiel, 1978) at 58; A.G. Canada v. Reader’s
Digest Assn. (Canada), [1961] S.C.R. 775, 30 D.L.R. (2d) 296, [1961] C.T.C. 530; Despatie v.
Tremblay, [1921] 1 A.C. 702, 124 L.T. 674, 37 T.L.R. 395 (P.C.).
88See Interpretation Act, R.S.Q., c. 1-16, s.40; art. 12, para. 2 C.C.L.C.; Interpretation Act,

R.S.C. 1985, c. 1-21, s.13.

89See Interpretation Act, R.S.C. 1985, c. 1-21, s.14; Tancelin, supra, note 80 at 18-20; Pigeon,

supra, note 87; C6t , supra, note 85 at 339-50.

1989]

SELLER’S REVENDICATION REMEDY

creates a paradox vis-i-vis the very notion of interpretation. Once it is necessary
to look outside a text of law in order to interpret it, all reasonable and reliable
sources of meaning should be consulted. In fact, as regards the Civil Code of
Lower Canada, the rule excluding recourse to travaux preparatoires in a wide
sense is unintelligible in the face of article 2712 C.C.L.C. which as indicated
above requires reference to pre-codification laws, at least, to determine the
extent to which they are still in force in Quebec.9″ It is conceded that in a judi-
cial context, consultation of the Codifiers’ Reports and pre-codification sources
of law is usually a luxury reserved for the interpretation of ambiguous codal
provisions and, in rare cases, determination of the extent to which pre-
codification law is still in force in Quebec. Thus, while reference to the
Codifiers’ Reports and pre-codification rules cannot be excluded altogether in
a judicial context, it is not a primary technique of interpretation. In fact, the
restrictive role of the Codifiers’ Reports and pre-codification law in the inter-
pretation of the Civil Code of Lower Canada counterbalances the generally
static form of the Code. Due to its format, the adaptation of the Code to societal
changes would be difficult, if not impossible, if the primary technique of inter-
pretation were consultation of the Codifiers’ Reports and pre-codification law.
As time goes on, an historical analysis of the Code might become less desirable
and less reliable.9′

There are cogent reasons for supporting both the permissive and restrictive
approaches to codal interpretation. A reasonable and efficient approach, situated
somewhere between the two theories, entails referring to historical sources only
where the interpretive problem and ambiguity cannot be resolved otherwise.
However, applying this approach or the two theories discussed above to article
1999(1) C.C.L.C. leads to the substantive conclusion that the analysis be limited
to modem or post-codification sources. The first substantive reason is that the
historical basis for the rule in article 1999(1) C.C.L.C. does not exist in a mod-
em context. As stated above, prior to codification the sale and delivery of move-
able property transferred ownership to a buyer only if upon delivery the buyer
paid the price, gave adequate security in lieu of payment or was given the ben-
efit of a term for payment by his seller.92 Since the revendication remedy was
available to a seller only qua owner, he would forfeit the remedy if he trans-
ferred ownership to his buyer by according a term for payment. In a modem
context, however, the transfer of ownership in sale is consensual;93 the consent

9 0See text accompanying notes 83-85.
9 1See Brierley, supra, note 80 at 525.
92See text following note 58 and accompanying note 68.
93See arts 1025, 1472 C.C.L.C.; T. McCord, “Synopsis” in T. McCord & A.D. Nicholls, eds, The
Civil Code of Lower Canada, 3d ed. (Montreal: Dawson Bros, 1880) at iv-v; Pourcelet, supra, note
1 at 68; Rousseau-Houle, Precis diu droit de la vente et du louage, supra, note 1 at 20-21; Jacoby,
supra, note 70 at 74-76; Gow, supra, note 70 at 248-5 1; D. Lefebvre, “La vente en droit qurb~cois
est-elle un contrat consensuel?” (1962) 22 R. du B. 181; Brun, supra, note 70 at 273ff.; Lafleur

McGILL LAW JOURNAL

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of the parties alone transfers ownership without consideration as to the timing
of payment of the price or delivery. As a result, the transfer of ownership cannot
be the modem basis for article 1999(1) C.C.L.C. because ownership is no longer
the basis for the seller’s revendication remedy. Applying a purely historical
analysis under these circumstances would only give rise to a paradox.

A second substantive reason for analysing article 1999(1) C.C.L.C solely
within its modem context is that on its face the provision is not really ambig-
uous. While its function as an element of the revendication remedy is unclear,
the meaning of article 1999(1) C.C.L.C. is plain.94 According to both the inter-
pretation methodologies discussed above, there is no immediate justification on
the face of article 1999(1) C.C.L.C. for reference to pre-codification law. The
historical bases of the provision can help to explain it as a modem anomaly only
if its anomalous nature is established independently.

2. The Notion of a Term

In civil law, a term is a future and certain event which qualifies or modifies
the performance of an obligation.95 A suspensive term delays the exigibility or
due date of an obligation so that a creditor cannot demand performance of it
before the term’s expiration.96 An extinctive term ends an obligation and limits
the duration of a creditor’s right to demand performance to the period of the
term.97 For the purposes of the present analysis, only suspensive terms or terms
which delay the exigibility of a debt thereby effectively extending credit to a
debtor are relevant.

v. Viens & St-Laurent Ltie (1983), [1984] C.S. 311; Sous-ministre du revenu du Qudbec v.
Coopirativefidirge du Quebec, [1984] C.A. 564 at 569, Rothman J.A.; Soucy v. Filion, [1976]
C.A. 870; Zusman v. Tremblay, [1951] S.C.R. 659 at 671-73, Taschereau J.

vis-a-vis art. 1092 C.C.L.C.

94See text accompanying notes 175-89 as regards difficulties interpreting art. 1999(1) C.C.L.C.
95See arts 1089-1092 C.C.L.C.; J.-L. Baudouin, Les obligations, 3d ed. (Cowansville: Yvon
Blais, 1989) at 456-57; J. Pineau & D. Burman, Thiorie des obligations, 2d ed. (Montreal: Thdmis,
1988) at 356; M. Tancelin, Des obligations, 4th ed. (Montreal: Wilson & Lafleur, 1988) at 187;
L. Faribault, Traitj de droit civil du Quebec, vol. 8-bis (Montreal: Wilson & Lafleur, 1959) at 95;
M. Planiol & G. Ripert, Trait6 pratique de droit civilfrangais, 2d ed. by P. Esmein, J. Radouant
& G. Grabolde, vol. 7 (Paris: L.G.D.J., 1954) at 336; B. Starck, Droit civil – obligations (Paris:
Librairies Techniques, 1972) para. 1841; Encyclop~die juridique Dalloz: Repertoire de droit civil,
2d ed., “Terme”, by F. Derrida, No. 1; Juris-classeur civil, art. 1136-1270, “Contrats et
Obligations, Obligation 4 terme”, by D. Veaux, fasc. 50 A 52, No. 1; Boilard v. Gaudreau, [1980]
C.P. 142.

96See art. 1089 C.C.L.C.; Baudouin, ibid. at 456; Pineau & Burman, ibid. at 357; Tancelin, ibid.
at 187; Faribault, ibid. at 96; Planiol & Ripert, ibid.; Starck, ibid.; Derrida, ibid., Nos, 1, 21-27;
Veaux, ibid., Nos 2, 33ff.

97See Baudouin, ibid.; Pineau & Burman, ibid.; Tancelin, ibid.; Faribault, ibid.; Planiol & Ripert,

ibid.; Starck, ibid.; Derrida, ibid., Nos 1, 28, 33; Veaux, ibid., Nos 2, 122ff.

1989]

SELLER’S REVENDICATION REMEDY

As a future event, a term must end after the creation of the obligation it
modifies. The certainty requirement refers to the occurrence of the event which
limits the duration of a term and not to the duration itself.9 Hence, a suspensive
term such as “until death” is a valid term because of the certainty of death
despite the uncertain duration of life.99 This notion of certainty is a means of dis-
tinguishing terms and conditions in civil law and reflects their respective roles
as modalities of obligations. As stated before, a term modifies the performance
of an obligation without affecting its initial inception. An extinctive term ends
the legal existence of an obligation and, hence, its exigibility only prospectively
or from the end of the term. Prior to that time, the obligation has its full legal
effect.

In civil law, a condition is a future and uncertain event which retroactively
qualifies the initial creation or existence of an obligation.” A suspensive con-
dition until fulfilled suspends the legal existence and effect of an obligation.0 1
Once the condition has been fulfilled, the obligation is deemed to have existed
from the date of the juridical act which created it and imposed the condition.0 2
Inversely, an extinctive or resolutory condition until fulfillment does not affect
the legal existence of the obligation it modifies.0″ Once fulfilled, however, the

98See Baudouin, ibid. at 457; Pineau & Burman, ibid. at 356; Tancelin, ibid. at 187-88; Faribault,
ibid. at 98; Planiol & Ripert, ibid. at 337; Starck, ibid.; Derrida, ibid., Nos 11-14; Veaux, ibid., Nos
5, 6.

99See Baudouin, ibid.; Pineau & Burman, ibid.; Faribault, ibid.; Planiol & Ripert, ibid.; Starck,
ibid.; Derrida, ibid., No. 13; Veaux, ibid., No. 6; Fiduciaires de la citj et du district de Montrial
Ltge v. Mallette, [1981] C.S. 633, aff’d sub nom. Mallette v. Mallette (22 April 1985), Montreal
500-09-000710-814, J.E. 85-462 (C.A.); Labadie v. Labrecque, [1981] C.A. 401; Machines auto-
matiques Laniel Co. (Sainte-Addle) v. Beausoleil, [1985] C.P. 189.

‘0See arts 1079, para. 1, 1085 C.C.L.C.; Baudouin, ibid. at 457, 462, 467; Pineau & Burman,
ibid. at 362, 363, 372; Tancelin, supra, note 95 at 187, 195, 197; Faribault, ibid. at 15, 49-59;
Planiol et Ripert, ibid. at 370; Starck, ibid. at 544; Juris-classeur civil, art. 1136-1270, “Contrats
et Obligations, Obligations conditionnelles, Caract~res de la condition”, by J.-J. Taisne, fasc. 40

43, No. 1.
‘0ISee art. 1079, para. I C.C.L.C.; Baudouin, ibid. at 462-63, 465; Pineau & Burman, ibid. at
362-63, 369-70; Tancelin, ibid. at 197; Faribault, ibid. at 17, 62; Planiol & Ripert, ibid. at 372,
379-83; Starck, ibid. at 547-48; Juris-classeur civil, art. 1136-1270, “Contrats et obligations,
Obligations conditionnelles, Effets de la condition suspensive”, by J.-J. Taisne, fasc. 47, Nos 4-33.
102See art. 1085 C.C.L.C.; Baudouin, ibid., at 466-67; Pineau & Burman, ibid. at 371; Tancelin,
ibid. at 197-98; Faribault, ibid. at 62; Planiol & Ripert, ibid. at 384ff.; Starck, ibid. at 548; Taisne,
ibid., Nos 47-88.

103See Baudouin, ibid. at 468-69; Pineau & Burman, ibid. at 371-72; Tancelin, ibid. at 198-99;
Faribault, ibid. at 72-77; Planiol & Ripert, ibid. 372-73; Starck, ibid. at 547; Juris-classeur civil,
art. 1136-1270, “Contrats et Obligations, Obligations conditionnelles, Effets de Ta condition r6so-
lutoire”, by J.-J. Taisne, fasc. 48, Nos 4-21.

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obligation is deemed never to have existed.” Hence, a condition is a means of
retroactively creating and extinguishing obligations.

The uncertainty element of a condition –

uncertainty as to whether the
future event will occur –
enables conditions to complement terms as mecha-
nisms which ensure the autonomy and intelligibility of the intention of parties
as to the creation and enforcement of obligations. A condition as an uncertain
event permits parties to agree that their rights and obligations may be affected
by events external to their immediate legal relationship. The parties agree to
bind themselves and at the same time recognize the dependence of their legal
situation upon external factors. If the future, external event is certain to occur,
the parties can decide whether to contract or not and, if the former, whether the
event affects the performance or duration of the ensuing obligations and there-
fore gives rise to a term. Without the possibility of conditional obligations, par-
ties who otherwise agreed would have to postpone the creation of a legal rela-
tionship until the future event occurred or until it became clear that the event
would not occur.

Terms and conditions reflect the factual and intentional reality behind legal
relations and in this context are complementary means of classifying and giving
effect to the intention of parties. The distinction between terms and conditions
based on the element of uncertainty is a necessary consequence of the combi-
nations of external factors which can affect legal relations. As is true of the clas-
sification of nominate contracts in civil law,”5 the taxonomy of modalities of
obligations such as terms and conditions is legal shorthand for the identification
and interpretation of the intention of parties to juridical acts. The importance of
the intentional aspect of modalities of obligations is particularly pronounced as
regards indefmite terms or terms the duration of which is uncertain. In some
instances, the authorities pertaining to indefinite terms appear to sacrifice the
strict taxonomy of terms and conditions in order to sustain the perceived inten-
tion of the parties.

As stated previously, “until death” is an indefinite term because it is certain
as to outcome and uncertain as to duration.’0 6 An analysis of the notion of cer-
tainty in this context is beyond the scope of this essay. Nevertheless, this notion
seems to be wide enough to include ostensibly uncertain events such as a
co-contractant’s ability and willingness to perform his obligations. For example,
the contractual stipulation that a debtor pays “when he is able” or “when it is

‘OSee art. 1085 C.C.L.C.; Baudouin, ibid. at 463, 468; Pineau & Burman, ibid. at 372; Tancelin,
ibid. at 199; Faribault, ibid. at 77-94; Planiol & Ripert, ibid. at 386ff.; Starck, ibid. at 548; Taisne,
ibid., Nos 26-57.

105See P. Malaurie & L. Ayn~s, Cours de droit civil: Les contrats spiciaux (Paris: Cujas, 1986)
at 7-19; Baudouin, ibid. at 52-53; Pineau & Burman, ibid. at 47; Pourcelet, supra, note 1 at 1.

‘6See text accompanying note 99.

1989]

SELLER’S REVENDICATION REMEDY

convenient” is widely accepted as an indefinite term. 7 Despite the uncer-
tain occurrence of these future events and their dependence to some degree
upon the will of the debtor, most authorities distinguish them from conditions
and, more particularly, from purely potestative conditions.’
In Quebec, the
basis for the distinction is article 1783 C.C.L.C. interpreted by reference to its
source and counterpart in French law, article 1901 C.N.’ Article 1783 C.C.L.C.
states that if, in a contract of loan for consumption, there is no agreement as to
the time for return of the thing borrowed, the time is fixed by the court accord-
ing to the circumstances. In a more precise fashion, article 1901 C.N. states:

S’il a dt6 seulement convenu que l’emprunteur paierait quand il le pourrait, ou
quand il en aurait les moyens, le juge lui fixera un terme de paiement suivant les
circonstances.

The requirement that a court consider the circumstances when fixing a term
indicates that the rationale for these codal provisions and for their application
beyond the realm of loans for consumption is the presumed intention of the par-
ties.”0 Where the occurence of an event or act, other than performance of an
obligation but dependent on the will of a debtor, modifies the performance of
the obligation, the courts assume, unless there is evidence to the contrary, that
the parties intend merely to delay performance but not to make the existence of
the obligation conditional upon occurrence of the act. In particular, in cases
where the event or act is the debtor’s ability to perform, the presumption in
favour of an indefinite term circumvents the application of the rule that an obli-

107See Poll v. Salaska (1932), 39 R.J. 310 (C.S.); Dame St-Gelais v. Gagnon, [1953] C.S. 247;
Binette v. Globensky (1931), 71 C.S. 111; Orban v. Levy (1918), 27 B.R. 370; Laberge v. Lepage
(1916), 56 C.S. 207 at 211-12, 213; Mercier v. Mercier (31 October 1986) Montreal
500-005-004814-867, J.E. 86-1119 (C.S.); Lambert v. Club des Chevaliers de Colomb de Matane,
[1954] C.S. 233; Cardiec v. Vaillant (1968), [1969] C.S. 284; Pr~voyants du Canada v. Poulin
(1969), [1970] C.S. 34 at 36-37; Hudon v. Landry, [1982] R.P. 163 (C.S.); Baudouin, supra, note
95 at 457; Pineau & Burman, supra, note 95 at 356; Planiol & Ripert, supra, note 95 at 337-38;
Starck, supra, note 95 at 549; Derrida, supra, note 95, No. 14; Veaux, supra, note 95, No. 16;
Faribault, supra, note 95 at 102-03.

‘0Ibid. See art. 1081 C.C.L.C. which provides: “An obligation conditional on the will purely
of the party promising, is void; but if the condition consists in the doing or not doing of a certain
act, although such act be dependent on his will, the obligation is valid.” These events are properly
classified as not being purely potestative conditions because they are external to the debtor’s will-
ingness to perform and, hence, objectively determinable.

109See Poli v. Salaska, supra, note 107; Binette v. Globensky, supra, note 107; Cardiec v.
Vaillant, supra, note 107; Privoyants du Canada v. Poulin, supra, note 107; Mercier v. Mercier,
supra, note 107; Baudouin, supra, note 95 at 457; Starck, supra, note 95 at 549-50.

“See Lareau v. Poirier (1915), 51 S.C.R. 637; Chouillon v. Johnson Co. (1920), 60 C.S. 256;
Picard v. Proteau (1916), 51 C.S. 115; Lachance & Morel (Ltie) v. Cantin (1934), 75 C.S. 235;
Chartier v. Chouinard (1944), [1945] C.S. 232; Mahaffy v. Baril (1896), 11 C.S. 475; Pelletier v.
Richard (1940), 79 C.S. 239; Dame Grenier v. Thibaudeau, [1942] C.S. 272; Bigaouette LtWe v.
Gagnon (1928), 34 R.L.n.s. 72 (C.S.); Derrida, supra, note 95, Nos 14-15; Veaux, supra, note 95,
Nos 10-15.

McGILL LAW JOURNAL

[Vol. 35

gation conditional purely on the will of the debtor, an obligation subject to a
purely potestative condition, is void.”‘ This presumed intent is also consistent
with the rule that contractual clauses are to be interpreted so as to have some
effect rather than in a way which produces none.” 2 While future events such as
a debtor’s ability and willingness to perform are uncertain in fact, they are by
necessity certain of occurrence in the minds of the parties in order to render
their contract intelligible and enforceable. Consequently, based on the parties’
presumed intention, future, uncertain events closely associated with a debtor’s
willingness or ability to perform are consistently held to be indefinite terms, as
opposed to conditions.” 3

Intention plays an analogous role in cases where parties specify an indef-
inite term which is truly a future, certain event or do not specify any time at all
for the performance of an obligation. In the former case, the circumstances will
indicate the parties’ intention as to a reasonable duration for the term.”4 In the
latter case, a finding of presumed intention has a dual function. It supports an
assumption that parties intend obligations to be performed within a reasonable
delay and indicates the duration of the delay.”5

In all of the above cases, where no exact time is specified for the perform-
ance of an obligation, the parties’ presumed intention is a basis for the existence
or duration of an implied term or both. From a practical point of view, recourse
to presumed intention arises only in the context of a court-appointed remedy ini-
tiated by one of the parties to the contract. It is only where the parties cannot
voluntarily and bilaterally fix the time of performance and one of them seeks
redress for late or non-performance by the other that a precise term for perform-

“1 See art. 1081 C.C.L.C. See also text accompanying note 108.
“2See art. 1014 C.C.L.C. The interpretation is not inconsistent with art. 1019 C.C.L.C. which
states that in cases of doubt a contract is interpreted against the person who has stipulated and in
favour of the one who has contracted the obligation. In the present case, the stipulation to pay
“when you can” is deemed to have been stipulated in favour of the debtor. Hence, it is consistent
with both arts 1014 and 1019 C.C.L.C. to interpret the phrase against the interest of the debtor by
characterizing it as a future, certain event or term, as opposed to a future, uncertain event or con-
dition which might be potestative.
” 3This tendency of Quebec and French authorities is not absolute. According to the circumstan-
ces, the presumed intention of the parties may indicate the presence of a future, uncertain event
or condition. See Dgchenes v. Doody (1924), 38 B.R. 273; Pineau & Burman, supra, note 95 at
363-64; Derrida, supra, note 95, Nos 14, 17; Veaux, supra, note 95, No. 9; Taisne, supra, note 100,
Nos 17-24.
“4See Guy v. Par6 (1892), 1 C.S. 443 (Court of Rev.); La compagnie d’Aqueduc de la Jeune
” 5See Lareau v. Poirier, supra, note 110; Chouillon v. Johnson Co., supra, note I10; Picard v.
Proteau, supra, note 110; Lachance & Morel (Ltde) v. Cantin, supra, note 110; Pelletier v. Richard,
supra, note 110; Chartier v. Chouinard, supra, note 110; Dame Grenier v. Thibaudeau, supra, note
110; Mahaffy v. Baril, supra, note 110; Bigaouette Lte v. Gagnon, supra, note 110; Timossi v.
Moos (1907), 16 B.R. 382. The situation in which the parties do not specify any term for perform-
ance is property the domain of art. 1783 C.C.L.C. See text accompanying note 97.

Lorette v. Dame Turner (1921), 33 B.R. 1.

1989]

SELLER’S REVENDICATION REMEDY

ance is imposed by an external authority such as a court. The remedial context
necessary for the external fixing of an indefinite term in effect dictates the pro-
cedure for doing so. It also establishes the important link between indefinite and
implied terms and the process of putting in default.

3. The Role of Putting in Default

In the context of contractual relations, putting in default or mise en
demeure is, subject to certain exceptions, a pre-requisite for all court-appointed
remedies and a defacto screening mechanism for serious breaches of contract.”6
A creditor puts a debtor in default vis-h-vis a contractual obligation by formally
notifying him that he is late or otherwise in breach as regards performance and
by insisting upon performance of the obligations past due.”7 The process
ensures that prior to litigation, a debtor is aware that according to his creditor
he has breached an obligation and that the breach is in his creditor’s view seri-
ous enough to warrant a judicial remedy. As a notice mechanism, putting in
default permits a debtor to avoid litigation by rectifying the default or negoti-
ating with his creditor. The process of mise en demeure prompts a creditor to
state his intention vis-t-vis his debtor’s non-performance thereby opening lines
of communication between the parties before litigation ensues.

The formal role of mise en demeure is to establish the legal date of a deb-
tor’s default to perform his obligations. This crystallization of default has three
primary legal effects. First, it determines the precise date at which damages suf-
fered by a creditor are deemed to arise and, hence, permits their evaluation.
Second, it establishes the date after which a creditor can exercise his contractual
remedies, most notably dissolution of the contract, without further notice to his
debtor. Third, if a debtor is obliged to deliver a certain and determinate object
to a creditor, default as regards this obligation imposes upon the debtor the risk
of fortuitous loss of the thing.

There are numerous codal and jurisprudential exceptions to the general rule
that a creditor must formally put his debtor in default before commencing lit-
igation to enforce a contractual remedy. The most common of these arises where
the parties expressly and unequivocally stipulate in a contract that late perform-

” 6See R.P. Kouri, “The Putting in Default” (1971) 2 R.D.U.S. 1 at 4-5; Baudouin, supra, note
95 at 398-99; Pineau & Burman, supra, note 95 at 418; Tancelin, supra, note 95 at 399; F. David,
“De la mise en demeure” (1939) 59 Rev. crit. leg. jur. 95 at 95, 97, 100-04; Planiol & Ripert, supra,
note 95 at 81-82; Starck, supra, note 95 at 602-03; Encyclopidie juridique Dalloz: Ripetoire de
droit civil, 2d ed., vol. 5 “mise en demeure”, by R. Perrot & C. Giverdon, No. 1; Shorter v.
Beauport Realties (1964) Inc. (1968), [1969] C.S. 363; Gareau v. Les Habitations Beauprg Inc.,
[1981] R.L. 410 (C.S.); Mindlin v. Cohen, [1960] C.S. 114.
“7See Kouri, ibid. at 46-50, 51-54; Baudouin, ibid. at 398; Pineau & Burman, ibid. at 418-19;
David, ibid. at 103-05; Planiol & Ripert, ibid. at 82-84; Starck, ibid. at 603-04; Perrot & Giverdon,
ibid., Nos, 25-31; Shorter v. Beauport Realties (1964) Inc., ibid.

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ance entails an automatic default.” 8 In the case of conventional or contractual
default, the parties’ intention ex ante is clearly to enforce rigorously all obliga-
tions under the contract and to waive the formal mise en demeure process. A
second common exception is the rule that in commercial contracts with a fixed
term for performance, a debtor is put in default for late performance by the mere
lapse of time.” 9 This exception is essentially an application of the presumption
that parties intend time to be of the essence in commercial matters.’ A third
exception arises where the debtor has not performed an obligation to do or to
give which could only have been performed within a limited period of time.’
In other words, where the debtor has rendered performance impossible, he is
automatically in default. Under this rubric also falls the automatic default for
breach of a negative obligation or duty not to do.” A fourth exception arises
where a provision of law dispenses with putting in default for breach of specific
obligations.”n Fifth, prior to the institution of an action in dissolution of con-
tract, a creditor does not have to put in default a debtor who has unequivocally
repudiated the contract or formally declared that he will not perform his con-
tractual obligations. 24 Similarly, it is not necessary to put in default a debtor
who admits or recognizes his default under a contract.”z Finally, in a contract
with continuous or successive obligations, it is not necessary for a creditor to
put the debtor in default vis- -vis each successive breach. 26 One mise en
demeure is sufficient. In all of these exceptional cases, a debtor is put in default
by the event which constitutes the contractual breach.

I”See art. 1067 C.C.L.C.; Kouri, ibid. at 27-34; Baudouin, ibid. at 399; Pineau & Burman, ibid.
at 420; Tancelin, supra, note 95 at 400; David, ibid. at 107-09; Planiol & Ripert, ibid. at 84-85;
Starck, ibid. at 604; Perrot & Giverdon, ibid., Nos 5-8.

119SeeArt. 1069 C.C.L.C.; Kouri, ibid. at 10-17; Baudouin, ibid. at 400; Pineau & Burman, ibid.

at 420; Tancelin, ibid. at 400; David, ibid. at 110; Perrot & Giverdon, ibid., No. 10.

12See Baudouin, ibid.; Bigaouette Ltie v. Gagnon, supra, note 110; Kouri, ibid. at 10-11; David,

ibid.

121See art. 1068 C.C.L.C.; Kouri, ibid. at 17-25; Baudouin, ibid.; Tancelin, supra, note 95 at 401;
David, ibid. at 109; Starck, supra, note 95 at 604; Planiol & Ripert, supra, note 95 at 85; Perrot
& Giverdon, supra, note 116, Nos 16, 17.

122See arts 1070 & 1134 C.C.L.C.: Kouri, ibid. at 25-27; Baudouin, ibid.; Pineau & Burman,
supra, note 95 at 420; Tancelin, ibid.; Starck, supra, note 95 at 604; Perrot & Giverdon, ibid., Nos
13-15.

123E.g. arts 296, 313, 722, 871, 1049, 1088, 1200, 1544, 1713, and 1840 C.C.L.C.
124See Kouri, supra, note 116 at 36; Baudouin, supra, note 95 at 400; Tancelin, supra, note 95
at 401; Starck, supra, note 95 at 604; Planiol & Ripert, supra, note 95 at 85; Perrot & Giverdon,
supra, note 116, Nos 19-21; Shorter v. Beauport Realties (1964) Inc., supra, note 116; Raoul
Beaubieu Inc. v. Dion (1982), [1984] R.L. 91 (C.P.); DiPaola General Building Contractors Ltd.
v. Boulanger, [1962] B.R. 783.

supra, note 116; Shorter v. Beauport Realties (1964) Inc., ibid.

125See Kouri, ibid. at 36-38; Planiol & Ripert, ibid.; Gareau v. Les Habitations Beauprj Inc.,
126See Baudouin, supra, note 95 at 400; Tancelin, supra, note 95 at 401; Perrot & Giverdon,

supra, note 116, Nos 22-24.

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SELLER’S REVENDICATION REMEDY

Assuming that none of the above exceptions applies, there are three tech-
niques for formal mise en demeure in Quebec. These are a verbal or written
demand for performance and the commencement of a suit before the courts. 7
A verbal demand for performance is permissible only if the contract itself is ver-
bal. ” In all cases, the mise en demeure must contain a clear and unequivocal
demand for performance. 9 Further, there is some indication in the Quebec
authorities that the formal notice of putting in default takes effect only after a
delay which is reasonable under the circumstances.’
This inherent delay is
known as a dilai de grace and may be either expressly stipulated by a creditor
in a formal putting in default notice or imposed by a court. Finally, it is a formal
requirement for putting in default that a creditor abide by the terms of the con-
tract as regards the enforcement of his debtor’s obligations and performance of
his own obligations. Hence, if the debt is qurable or payable at a place other
than the creditor’s domicile, the creditor must actually seek payment at the
appropriate location in order to substantiate factually a debtor’s default prior to
putting him in default.’
In synallagmatic contracts, a creditor must be ready,
willing and able to perform his contractual obligations in order to validly put his
debtor in default.’32 In other words, a purported mise en demeure of a debtor
who has validly withheld performance according to the exceptio non adimpleti
contractus will be without effect.

Given these rules for putting in default, there are multiple connections
between terms for performance in civil law and the process of putting in default.
First, the institution of formal mise en demeure is based on the rule in favour
of debtors that a creditor is deemed to extend tacitly the delay for performance
unless and until he puts his debtor in default.’33 In other words, in cases in which
a formal putting in default is necessary, until this is done the creditor is deemed
to have accorded to his debtor an indefinite term for performance even if the

127See art. 1067 C.C.L.C.; Kouri, supra, note 116 at 44-51; Baudouin, ibid. at 401; Tancelin,
ibid. at 400-01; Pineau & Burman, supra, note 95 at 419. Tancelin and Kouri point out the anomaly
of classifying commencement of a suit as a mise en demeure prior to a court-appointed remedy.
See Tancelin at 402; Kouri at 53-54. Nonetheless, the date of commencement of a suit is important
as a putting in default vis-k-vis the calculation of damages.

12’See art. 1067 C.C.L.C. There is a controversy as to whether the existence of a verbal contract
creates an exception as to the use of testimony to prove the mise en demeure. See Kouri, ibid. at
47-50; Baudouin, ibid. at 401; Pineau & Burman, supra, note 95 at 419.

129In the context of commencement of a suit, there is sometimes difficulty fulfilling this require-
ment because a declaration issued in pursuance of a particular contractual remedy does not always
include conclusions for specific performance. See supra, note 127.

’30See Kouri, supra, note 116 at 57-58.
131See Kouri, ibid. at 33-34, 56; Trester v. Desire (1917), 27 B.R. 237.
132See Baudouin, supra, note 95 at 402; Kouri, ibid. at 54.
133See Kouri, ibid. at 4-5; Baudouin, ibid. at 398-99; Pineau & Burman, supra, note 95 at
418-19; David, supra, note 116 at 101-02; Planiol & Ripert, supra, note 95 at 82; Perrot &
Giverdon, supra, note 116; Reinhardt v. Turcotte, [1956] B.R. 241; Cardinal v. Lalonde (1907),
31 C.S. 322 (C. of Rev.); Place Versailles Inc. v.

ille de Montrial, [1977] C.A. 176.

McGILL LAW JOURNAL

[Vol. 35

contract originally stipulated a fixed term. This rule is extraordinary in that not-
withstanding the factual non-performance or late performance by a debtor under
the terms of a contract, the onus is placed upon a creditor to establish the legally
effective date of default. However, the practical impact of the general rule has
been reduced greatly due to the proliferation of codal and jurisprudential excep-
tions.M

Not only does the absence of a mise en demeure when required impose by
implication an indefinite term for performance, but mise en demeure is the pro-
cedure by which all indefinite terms whether implied or express are fixed.’35 As
a pre-condition to a judicial remedy, mise en demeure determines legally both
the due date of performance and the corresponding date of default. In almost all
cases where it is required, a formal mise en demeure necessarily indicates the
existence of an express or implied, indefinite term for performance.’36 Hence,
indefinite terms are rendered definite by a mise en demeure in the form of a ver-
bal or written demand or commencement of suit before the courts. As stated pre-
viously,37 in the absence of agreement by the parties as to a precise delay for
performance, a remedial and judicial context is unavoidable. In this context, a
court will determine the proper delay according to the presumed intention of the
parties either ex post by determining if a formal mise en demeure was reason-
able under the circumstances’38 or ex ante by actually fixing the delay for per-
formance in default of which a court-appointed remedy will be enforceable.’3 9

134See text accompanying notes 118-26.
135See Planiol & Ripert, supra, note 95 at 349; Kouri, supra, note 116 at 12-16; Veaux, supra,
note 95, Nos 10-16; Tancelin, supra, note 95 at 400-01; Danmar Construction Co. Ltd. v. P.G.
Qudbec, [1972] C.S. 771; Marley Canadian Ltd. v. Canada Ballotini Inc., [1971] C.S. 477;
Chouillon v. Johnson Co., supra, note 110; Labont v. Lalibertd (1942), [1943] C.S. 394; Lebrun
v. Gruninger (1917), 27 B.R. 210; La Compagnie d’Aqueduc de la Jeune Lorette v. Dame Turner,
supra, note 114; Laberge v. Lepage, supra, note 107.

136Apparently, the only situation in which a formal mise en demeure is required but does not
imply an indefinite term is where the contract specifies a fixed term and prior to term the creditor
formally notifies the debtor that the latter will be in default if performance is late. See Reinhardt
v. Turcotte, supra, note 133; Kouri, ibid. at 55. These authorities indicate that a pre-term mise en
demeure will only be valid if it is given close enough to the term to sustain a continuing intention
by the creditor to enforce the due date for performance. In effect, this pre-term mise en demeure
permits a creditor to unilaterally insert into the contract a stipulation of automatic default.

’37See text following note 115.
138See Picard v. Proteau, supra, note 110; Lachance & Morel (Lte) v. Cantin, supra, note 110;

Dame Grenier v. Thibaudeau, supra, note 110.

139See Picard v. Proteau, ibid.; Lambert v. Club des Chevaliers de Colomb de Matane, supra,
note 107; Chartier v. Chouinard, supra, note 110; Guy v. Par6, supra, note 114; Caplan v.
Montreal City and District Realty Co. (1917), 52 C.S. 435 (C. of Rev.). The difficulty here is that
if a mise en demeure prior to suit is not adjudged to be reasonable, the declaration issued in com-
mencement of the suit must formally seek to enforce the debtor’s contractual obligations so as to
constitute a formal putting in default. In this regard, see supra, notes 115 and 117. Depending on
the remedy sought the default will arise from the date of the suit or from the date of non-
performance within the delay imposed by the court.

1989]

SELLER’S REVENDICATION REMEDY

In essence, the above described rule in article 1783 C.C.L.C. concerning loans
for consumption140 is merely an example of the courts’ role as ultimate arbiter
of the reasonableness of either judicial or non-judicial mise en demeure neces-
sary for express or implied, indefinite terms.

Finally, after an implied or express indefinite term has been fixed by a
formal mise en demeure and even in cases in which a formal mise en demeure
is dispensed with, a supervening, indefinite term can arise if the creditor
expressly or impliedly renounces to his post-default rights to enforce perform-
ance of his debtor’s obligations. 4′ Express renunciation would likely arise as a
result of a post-default bargain between the parties particularly in cases in which
a formal mise en demeure opens lines of communication. Implied renunciation
by a creditor to the rights resulting from a formal or automatic mise en demeure
arises where his behaviour indicates unequivocally an intention not to enforce
performance and not to hold a debtor responsible for damages ensuing after the
mise en demeure.’4 2 Renunciation to a right is never presumed. l 3 Hence, the fact
of a creditor not exercising a judicial remedy after formal or automatic default
would likely not amount to renunciation to the putting in default.'” On the other
hand, granting a new delay for performance without a reservation of rights
would indicate an intention to waive the effects of a previous mise en
demeure.’45 Similarly, any juridical act between the parties such as novation or
release of debt that has the effect of extinguishing the obligation which is the
object of defaultI also extinguishes the effects of default. 46

the notion of a term –

In summary, the timing of the enforceability of contractual obligations in
civil law –
is a question of intention. This intention may
be expressed by the parties to a contract. It may be implied by circumstances
surrounding the :formation of a contract or by a creditor’s behaviour vis-a-vis
putting in default, Intention as to the timing of performance may also be implied
by law as indicated by the exceptions to the rule requiring a formal mise en

14See text following note 109.
141See Kouri, supra, note 116 at 64; Faribault, supra, note 95 at 378; P. Raynaud, “La renon-
ciation A un droit” (1936) 35 Rev. trim. dr. civ. 763 at 773-74; Caplan v. Montreal City & District
Realty Co., supra, note 139; Thibault v. Dame Lafaille, [1951] C.S. 188.
142See Verret v. Pollock (1932), 38 R.L.n.s. 314 (C.S.); Turcotte v. Caisse Populaire St-Arsene
de Montreal (18 April 1985), Montreal 500-09-001685-817, J.E. 85-489 (C.A.); Gingras v.
Gagnon, [1977] 1 S.C.R 217 at 222, Beetz J.

’43See Raynaud, supra, note 141 at 774; Gingras v. Gagnon, ibid.; Mile End Milling Co. v.
Peterborough Cereal Co., [1924] S.C.R. 120; Ville de Laval v. Marquis, [1982] C.S. 755;
Encyclopidie juridique Dalloz: Ripetoire de droit civil, 2d ed., vol. 6 “Renonciation”, No. 8.

‘4See Kouri, supra, note 116 at 66.
145See Kouri, ibid. at 64; Faribault, supra, note 95 at 378; Caplan v. Montreal City and District

Realty Co., supra, note 141; Vall~e v. Tease (1908), 33 C.S. 299 (C. of Rev.).

16See Kouri, ibid. at 65. In order to extinguish the effects of default vis-4-vis the remedy of
damages, the juridical act would have to demonstrate an intention to extinguish the principal debt
as well as the debt of damages.

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demeure. The notion of a term in civil law, in particular that of an implied term,
is inextricably linked, if not synonymous, with the process of putting in default
in that both are necessary in some legal form to determine the timing of the
enforceability of obligations. Finally, in cases in which a term arises by impli-
cation, it will be of indefinite duration and will become fixed in duration only
through subsequent agreement by the parties or court intervention.

4. Sale on Credit or With a Term

In order to determine when a sale on credit or with a term as analysed
above arises under article 1999(1) C.C.L.C., it is necessary to consider the obli-
gational structure of the contract and the notion of payment in sale.

In civil law, the contract of sale is the archetypal synallagmatic or bilateral
contract in that inter alia it imposes upon a buyer and seller respectively the
reciprocal and simultaneous obligations of payment and delivery.’47 While the
transfer of ownership to a buyer is an important effect of sale,’48 as is the seller’s
obligation of warranty against eviction and latent defects,’49 delivery and pay-
ment of the price are inextricably linked in the obligational framework of the
contract. Article 1533 C.C.L.C., which states that in the absence of a stipulation
to the contrary, a buyer must pay the purchase price at the time and place of
delivery, does not indicate fully the roles of payment and delivery. In fact, deliv-
ery and payment are interdependent obligations; each being the contractual
cause of the other.5′ Accordingly, breach of one of these obligations by one
party entitles the other to withhold performance of the corresponding reciprocal
obligation under the exceptio non adimpleti contractus. It also permits the non-
defaulting party to sue to dissolve the contract.

’47See arts 1472, 1491, 1496, 1487, 1532, 1533 C.C.L.C.; Rousseau-Houle, Precis de droit de
la vente et du louage, supra, note 1 at 12, 17, 62, 92, 196-97; Pourcelet, supra, note 1 at 82, 105,
125, 168; Faribault, supra, note 2 at 22; Baudouin, supra, note 95 at 53-54; Pineau & Burman,
supra, note 95 at 42; Tancelin, supra, note 95 at 35; Boodman, “The Right of Retention of the
Seller of Moveables in Quebec”, supra, note 1 at 674-75; Lebel v. Commissaire d’tcole pour la
municipalitj de la Ville de Montmorency, [1955] S.C.R. 298; Superior Leather Goods v. Advanced
Fur Mfg. Co., [1948] C.S. 198; Cusson v. Philion, [1959] C.S. 248.
148See art. 1022, para. 2 C.C.L.C.; Rousseau-Houle, ibid. at 83; Pourcelet, ibid. at 83, 84;
Baudouin, ibid. at 187-88; Pineau & Burman, ibid. at 217-18; G. Trudel, Traitg de droit civil du
Qubec, vol. 7 (Montreal: Wilson & Lafleur, 1946) at 315-20, 347-54; Faribault, supra, note 141
at 221-25; Boodman, “The Prepaying Buyer of Corporeal Moveables in Quebec”, supra, note 1
at 877, 908; Faribault, ibid. at 48.

149See art. 1491 C.C.L.C.
150See arts 1496, 1497 C.C.L.C.; Rousseau-Houle, Pr6cis de droit de la vente et d

louage,
supra, note I at 17, 196; Pourcelet, supra, note 1 at 125, 167, 168; Faribault, supra, note 2 at 309,
315; Baudouin, supra, note 95 at 53-54; Pineau & Burman, supra, note 95 at 42; Boodman, “The
Right of Retention of the Seller of Moveables in Quebec”, supra, note 1 at 674-75, 683.

19891

SELLER’S REVENDICAT[ON REMEDY

Given their obligational interdependence, payment and delivery in sale can
be analogized to mutual, indefinite terms for performance such as terms consist-
ing of a debtor’s willingness to perform.’5′ Unless there is a stipulation to the
contrary, delivery and payment are mutual catalysts for performance. Payment
is due only when delivery takes place. Delivery may be due under the contract
at a fixed or indefinite time. Nonetheless, it is not due if payment is not forth-
coming.’52 In either case, the catalyst is not a definite or indefinite time period
but an event consisting of performance by the other party which is never truly
certain of occurrence. The analogy to terms such as “when you are able” or
“when it is convenient” is apt because parties to a contract of sale intend to cre-
ate the mutual obligations of delivery and payment and intend them to be bind-
ing. The intentional certainty of occurrence overrides any factual uncertainty.
Further, in sale, the obligations of delivery and payment are said to arise by con-
sent to the contract.’53 Only the respective due dates of these obligations are
affected by their obligational interdependence. Hence, delivery and payment do
not function as mutually conditional obligations;'” instead, they are analogous
to mutual, indefinite terms for performance implied by law in the absence of a
contrary, contractual stipulation.

The status of payment and delivery as mutual terms is supported by the
legal effects of the exceptio non adimpleti contractus. The remedy is essentially
a legal excuse or defense for non-performance by the non-defaulting party.’55 It
does not terminate the parties’ contractual relationship, nor does it remedy the
non-performance of the defaulting party. It merely suspends the exigibility of
the non-defaulting party’s obligation until performance of the corresponding
obligation by the other party. In other words, it acts as an indefinite term in
favour of the non-defaulting party.’56

In summary, mutual indefinite terms for performance are an intrinsic ele-
ment of all synallagmatic contracts, at least as regards reciprocal, simultaneous

151See text accompanying notes 107-13.
’52See arts 1496, 1497 C.C.L.C.; Boodman, “The Right of Retention of the Seller of Moveables
in Quebec”, supra, note 1 at 674-76, 677; Pourcelet, supra, note 1 at 125-26; Rousseau-Houle,
supra, note 150 at 200; Faribault, supra, note 2 at 196; Baudouin, supra, note 95 at 279; Tancelin,
supra, note 95 at 360-63; Interprovincial Lumber Co., v. Matapedia Co., [1973] C.A. 140.
’53See Rousseau-Houle, ibid. at 12; Pourcelet, ibid. at 85-86; Boodman, “The Prepaying Buyer
154See as regards the notion of a condition text accompanying notes 110-14.
155See Baudouin, supra, note 95 at 277-78; Pineau & Burman, supra, note 95 at 416; Tancelin,
supra, note 95 at 405; Boodman, “The Right of Retention of the Seller of Moveables in Quebec”,
supra, note 1 at 683; Dumas v. Ostiguy, [1950] C.S. 60; Eugene Falardeau Lte v. O.M.H.Q.,
[1976] C.A. 244.

of Corporeal Moveables in Quebec”, supra, note 1 at 876-77; Faribault, ibid. at 31, 49-50.

156See Baudouin, ibid. at 280; Pineau & Burman, ibid. at 414; P.-B. Mignault, Droit civil cana-
dien, vol. 5 (Montreal: C. Th~oret, 1901) at 450; Robert v. Sarrault (1913), 53 C.S. 484; Fortier
v. Perrault (1923), 29 R.L. 354 (C.S.); Drouin v. Gilbert, supra, note 1; Eugene Falardeau Lte
v. O.M.H.Q., ibid.; Pelland v. Feldman (1945), [1946] R.L. 153 (C.S.).

McGILL LAW JOURNAL

[Vol. 35

obligations. The existence of these terms is implied by law based upon the pre-
sumed intention of the parties. The rule in sale is that unless parties express a
contrary intention, payment and delivery are reciprocal, simultaneous obliga-
tions. Revendication is a post-delivery remedy available to a seller for non-
payment of the purchase price by a buyer. Hence, a sale on credit or with a term
under article 1999(1) C.C.L.C. requires that the parties set aside the legal pre-
sumptions as to intention and indicate that the price is payable after the due date
for delivery. For example, the stipulation of a term for payment unaccompanied
by a term for delivery demonstrates an intention to sell on credit. In this case,
an indefinite, reasonable term for delivery is implied.’57 In the absence of an
express starting date, the term for payment, presumed to benefit the buyer as
debtor,’58 is interpreted to commence at delivery, the presumptive date at which
the price would otherwise be payable. By contrast, a term for delivery unaccom-
panied by a term for payment does not indicate an intention to sell on credit in
the context of article 1999(1) C.C.L.C. because it merely delays both obligations
without affecting their reciprocal and simultaneous nature.’59

Contractual stipulations of credit as described above, however, are not suf-
ficient to activate the restriction in article 1999(1) C.C.L.C. These stipulations
merely demonstrate an intention or agreement to give credit. Actual credit in the
context of article 1999(1) C.C.L.C. arises only if the seller has performed his
delivery obligation prior to performance by the buyer of his corresponding obli-
gation to pay the price. A seller’s prior performance is essential to the existence
of credit due to the synallagmatic nature of sale and the nature of the seller’s
revendication remedy. As stated above, until delivery, the price is not exigible
because of the obligational structure of sale and not because of any term
accorded the buyer. Until delivery, credit is inchoate.”6 It may be argued that the
transfer of ownership to a buyer before the price is payable is an extension of
credit to him. The argument is attractive because ownership and possession are
closely associated in fact and in law.’6′ Nonetheless, in a modem context, the
transfer of ownership per se is a legal effect of sale, foreign to the obligational
structure of the contract except to the extent that a buyer’s ownership is
enhanced by performance of a seller’s obligations. 62 In other words, in the con-

’57See text accompanying note 115. See also Pourcelet, supra, note 1 at 112, 168; Rousseau-

Houle, Prcis du droit de la vente et du louage, supra, note 1 at 87-88.

5’See art. 1091 C.C.L.C.
’59See art. 1533 C.C.L.C.; Pourcelet, supra, note 1 at 168; Rousseau-Houle, Pricis d droit de
la vente et du louage, supra, note 1 at 197; Faribault, supra, note 2 at 311, 313; Boodman, “The
Right of Retention of the Seller of Moveables in Quebec”, supra, note 1 at 677.

‘6Conversely, if it were stipulated that the price was due before delivery, until actual payment

the credit or term accorded the seller vis-A-vis his delivery obligation would be inchoate.

of Retention of the Seller of Moveables in Quebec”, supra, note 1 at 666-67.

16’See arts 2193, 2268(1) C.C.L.C.; Macdonald, supra, note 4 at 590-92; Boodman, “The Right
162For example, a seller’s warranty against eviction, obligation to deliver accessories such as title
documents and keys and obligation to render goods certain and determinate enhance and make

1989]

SELLER’S REVENDICATION REMEDY

text of synallagmatic contracts, true credit or a term vis-a-vis otherwise recip-
rocal simultaneous obligations exists only if the parties intend that one party’s
obligation is to be executed while the other’s remains executory and that state
of affairs actually exists. 63

It is obvious that revendication as a post-delivery remedy presupposes per-
formance of the seller’s delivery obligation. The result is that breach of the
requirement in article 1999(1) C.C.L.C. entails two events, namely: i) the exis-
tence of a term which makes the price payable after delivery and ii) delivery
itself.

The notion of express and implied, definite and indefinite terms discussed
above, and the connection in the context of article 1999(1) C.C.L.C. between
terms or credit and performance of the seller’s delivery obligation indicate that
any voluntary delivery by a seller without immediate receipt of the purchase
price entails the granting of a term for payment. The result is that the require-
ment in article 1999(1) C.C.L.C. makes the existence of the seller’s revendica-
tion remedy legally impossible.”6 The omni-presence of a term associated with
the seller’s revendication remedy is best demonstrated by considering a range
of scenarios concerning payment of the purchase price. In this regard, non-
insolvency and non-bankruptcy situations will be considered first.

The least complicated situation is that in which a seller by express stipu-
lation in the contract accords his buyer a term for payment, such as a specified
time delay, so that the price is payable after delivery. Assuming that according
to the terms of the contract the seller delivers and does not require payment, he
will have forfeited the revendication remedy. The intention of the parties is
clearly to dissociate the obligations of payment and delivery in a way which
breaches the requirement of article 1999(1) C.C.L.C. A common example of this
scenario is the sale on terms “net 30 days”. 65

Where there is no specific stipulation as to payment of the price, it is pay-
able upon delivery and a seller need not deliver unless the buyer is ostensibly
ready, willing and able to pay. At the point of delivery, the seller or his repre-
sentative always has a choice. He can choose to withhold delivery until payment

meaningful a buyer’s ownership. See Boodman, “The Prepaying Buyer of Corporeal Moveables
in Quebec”, supra, note 1 at 908-09.
163When obligations are not simultaneous, a term for performance or credit is inherent in the
contract. For example, a repairman’s right of retention under art. 441 C.C.L.C. presupposes per-
formance of the repair obligation prior to payment.

counterfeit currency. See text following note 202.

‘IThe only exception to this statement arises where a buyer pays a seller upon delivery using
165See Fiducie du Quebec v. Fabrication Precision Inc., supra, note 4; Re Roulottes Eureka
Ltie: Dionne v. Desroches (1974), 19 C.B.R.(n.s.) 268 (C.S.); Alcools de Commerce Inc. v.
Corporation de Produits Chimiques de Valleyfield, supra, note 5, McCarthy J.; Ppin v. Feeney,
supra, note 4; Goldstein, supra, note 1 at 97.

REVUE DE DROIT DE McGILL

[Vol. 35

is actually offered to him; ‘ 6 or, he can deliver goods notwithstanding the
absence of payment by the buyer. The choice to deliver without receipt of pay-
ment unequivocally indicates an intention by the seller to waive the reciprocity
and simultaneity of payment and delivery in sale. Delivery is the manifestation
of an intention to give the buyer a term for payment. The term is implied and
indefinite, analogous to that which arises by implication where a creditor neg-
lects to put his debtor formally in default though legally required to do so.’ 7

The implied, indefinite term for payment arises whether delivery is pre-
ceded by a seller’s demand for payment which is refused by a buyer, a buyer’s
express refusal to pay without a previous demand or silence by both parties. In
the first two situations, a buyer might initially be in default to pay by the seller’s
verbal or written demand’68 or by his own repudiation of the contract. 69 Yet, the
effects of any such default would surely be waived by the seller’s subsequent
delivery of the goods. 7 ‘ The ineluctable result of delivery without payment is
the extension of credit to a buyer by means of an implied, indefinite term.
Moreover, the creation of this term may be viewed not just as the unilateral act
of the seller, but as a bilateral act of buyer and seller.

In sale, delivery is a bipartite concept composed of buyer’s and seller’s
obligations. The seller’s delivery obligation, defined by article 1493 C.C.L.C.,
is inter alia to put the buyer in actual possession of the thing sold or to consent
to possession being taken by him. The buyer’s obligation to which allusion is
made in articles 1495 and 1544 C.C.L.C. is to receive or remove the thing deliv-
ered by the seller. Delivery which extinguishes a seller’s right of retention under
articles 1496 and 1497 C.C.L.C. and after which the revendication remedy is
appropriate arises only after the buyer has performed his delivery obligation.”
In other words, revendication is appropriate only after the buyer has participated
in the process of delivery by taking possession of the goods. In situations of
delivery without payment, the active roles of buyer and seller vis-A-vis delivery
combined with non-payment by the buyer indicate a joint or bilateral intention
to modify the initial contract by adopting an indefinite term for payment in
favour of the buyer.’72

166This would be an exercise of the right of retention under art. 1496 C.C.L.C. which is an exer-
cise of the contractual exceptio non adimpleti contractus. See text accompanying notes 155-56.

‘ 67See text accompanying note 133.
168See text accompanying note 127.
‘ 69See text accompanying note 124.
170Even delivery with a reservation of rights would affect renunciation to default as regards pay-
ment of the price upon delivery. However, it might protect the seller’s remedy in damages. As
regards renunciation to the benefits of default see text accompanying notes 142-45.

17’See Boodman, “The Right of Retention of the Seller of Moveables in Quebec”, supra, note
1721t is difficult to conceive of a situation in which a buyer accepts delivery, does not pay and,
yet, would not agree to a term for payment in his favour. If the custody of the goods were detri-

I at 660-72.

19891

SELLER’S REVENDICATION REMEDY

It has been suggested’73 that a credit sale and loss of the revendication rem-
edy can be avoided by replacing payment terms such as “net 30 days” with the
following contractual stipulation:

Accounts are payable in full upon delivery. Interest shall be charged on accounts
more than 30 days in arrears at the rate of 1% per month (19.56% per annum).

The intent of this clause is to sustain a cash sale by requiring payment upon
delivery, but to delay the imposition of interest for late payment until thirty days
after delivery. Given the above analysis concerning express and implied terms
for payment in sale, this clause will not achieve its desired effect. The stipula-
tion for payment upon delivery merely replicates the rule in article 1533
C.C.L.C 74 Upon factual delivery without payment an implied, indefinite term
for payment will arise as described above, thereby eliminating the seller’s
revendication remedy and demoting the rank of his privilege on judicial sale
proceeds. The stipulated delay for interest charges would not preclude the exis-
tence of an implied term based upon delivery without payment because credit
in this context includes any delay for payment with or without interest charges.
Further, the clause stipulates that interest will commence to run on accounts
“more than 30 days in arrears”. Given the implied, indefinite term resulting
from delivery without payment, no arrears would exist until the due date for
payment is fixed through the mechanism of putting in default. Ironically, the
seller’s position would be worsened rather than enhanced because the clause
would delay interest charges thirty days past the date of the buyer’s default in
payment of the purchase price.

The wording of the suggested clause is intentionally ambiguous in its
attempt to give a buyer the benefit of a term without running afoul of the rule
in article 1999(1) C.C.L.C. On this basis alone and notwithstanding a potential,
implied term for payment, a court would likely interpret the clause to have the
same legal effect as “net 30 days”. Hence, in cases of delivery without payment
with or without contract stipulations as to payment, actions speak louder than
words and give rise to an implied, indefinite term for payment.

Paradoxically then, non-payment of the purchase price upon delivery is at
the same time a legal cause for the revendication remedy and, by virtue of arti-
cle 1999(1) C.C.L.C. and the necessary implied term, a legal cause of its
extinction.

The paradoxical effect of the rule in article 1999(1) C.C.L.C. is particularly
acute in the case of a buyer’s insolvency or bankruptcy. According to article

mental to the buyer due to storage costs, for example, he would merely refuse delivery. This would
avoid the problem of revendication.
173See K.S. Atlas, “The Vendor of Moveables in Quebec: His Protection and Privileges” (1982)

42 R. du B. 597 at 613.

174See text following note 149.

McGILL LAW JOURNAL

[Vol. 35

1092 C.C.L.C., the general rule is that a debtor loses the benefit of the term inter
alia if he becomes insolvent or bankrupt. 5 In the former case, the intervention
of a suit is necessary to substantiate the debtor’s insolvency and the term is for-
feited only from the date of judgment. 76 In the case of bankruptcy, once this
juridical state is established by the appropriate proceedings, no further judicial
intervention is required and forfeiture takes effect from the date of bank-
ruptcy.’77 In both cases, article 1092 C.C.L.C. accelerates the term enabling a
creditor to demand performance and to put the debtor in default according to the
rules described above. 7 ‘ In this regard, the putting in default would likely occur
through the commencement of suit which results in a judicial declaration of a
debtor’s insolvency effective from the date of judgment’79 or by the filing of a
claim in the case of a debtor’s bankruptcy.’

In the context of a seller’s non-consensual remedies, forfeiture of the term
under article 1092 C.C.L.C. combined with the applicable rules for putting in
default establish a seller’s entitlement to a remedy for a buyer’s non-payment.”

In the context of a seller’s revendication remedy, the paradoxical effect of
article 1999(1) C.C.L.C. makes it impossible to determine whether article 1092
C.C.L.C. will have an effect. The phrase “the sale must not have been made on
credit” is itself ambiguous in this regard. In the case of Fiducie du Quebec v.
Fabrication Precision Inc., 2 article 1999(1) C.C.L.C. was interpreted without
discussion to refer to the original terms of the sale and not to any subsequent
forfeiture of a term. ‘ 3 However, the pluperfect past tense in the phrase is con-

17Art. 1092 C.C.L.C. provides:”The debtor cannot claim the benefit of the term when he has
become a bankrupt or insolvent, or has by his own act diminished the security given to his creditor
by the contract.”

176See Faribault, supra, note 95 at 112; Baudouin, supra, note 95 at 459; Pineau & Burman,
supra, note 95 at 360; Boodman, “The Right of Retention of the Seller of Moveables in Quebec”,
supra, note 1 at 680; Dalrymple v. Simms (1918), 58 C.S. 194; Arpin, Gendron & Beauregard Ltge
v. Tremblay, [1960] C.S. 577; Cie L~garg Ltie v. St-Amant, [1962] C.S. 29.
177See Faribault, ibid. at 110; Baudouin, ibid.; Pineau & Burman, ibid.; Boodman, ibid.;
17S5ee text accompanying notes 116-32.
179The commencement of suit in the case of insolvency would amount to a putting in default
prior to the due date which would be established by the judgment substantiating insolvency. See
supra, note 136.

Bankruptcy Act, supra, note 17, s.121(3); Re Hamel: Trottier v. Mathieu, [1964] B.R. 831.

’80See Bankruptcy Act, supra, note 17, s.121. Unless there is a specific clause in the contract
which states that bankruptcy is an automatic default, bankruptcy would not entail imposing a fixed
term under art. 1092 C.C.L.C. because the bankruptcy is neither a future nor certain event.

‘8’The seller’s right of retention under arts 1496 and 1497 C.C.L.C. appears to be exempt from
both judicial intervention under art. 1092 C.C.L.C. and formal putting in default. This is due to the
nature of the retention remedy as an exceptio non adimpleti contractus. See Boodman, “The Right
of Retention of the Seller of Moveables in Quebec”, supra, note I at 680.

182Supra, note 4.
‘I31bid. at 257, Turgeon J.A. states:

19891

SELLER’S REVENDICATION REMEDY

sistent with reference to both the time of sale and the period immediately pre-
ceding the exercise of the revendication remedy. In fact, the latter is obviously
the time of reference in article 1999(3) C.C.L.C. which requires that “the thing
must not have passed into the hands of a third party who has paid for it.” The
restriction of conditions in article 1999 C.C.L.C. to a time immediately preced-
ing the exercise of the revendication remedy is further supported by article
1999(4) C.C.L.C. This provision requires that revendication be exercised within
eight days of the sale. It is based on the assumption that a seller who does not
do so is deemed to have tacitly given a term for payment.’ s4

If the relevant reference point is the time immediately preceding the exer-
cise of the remedy, in principle article 1092 C.C.L.C. can apply to expunge the
term and re-activate the remedy. Yet, in this case as well the remedy is likely
doomed to failure. In order to invoke article 1092 C.C.L.C. when a buyer is
insolvent, a seller must initiate proceedings for a court to substantiate the insol-
vency and declare forfeiture of the term. In the present context, these proceed-
ings will also constitute a putting in default and the exercise of the seller’s
revendication remedy. The judicial, remedial context causes the seller’s plead-
ings to be contradictory in that he is simultaneously exercising the revendication
remedy and demanding the prospective forfeiture of a term. A paradox arises in
that until the remedy is exercised, article 1999(1) C.C.L.C. precludes its
exercise.

The same scenario would arise if the seller’s revendication remedy were
enforceable against a buyer’s trustee in bankruptcy.”8 5 After the declaration of
bankruptcy has caused forfeiture of the term, subject to contractual stipulations,
a mise en demeure will be necessary. Again, in order to expedite matters, it is
likely that the proceedings in revendication will also constitute the putting in
default. However, it is contradictory to exercise a remedy and establish its pro-
cedural preconditions in the same pleading. It may be suggested that in cases of
insolvency and bankruptcy, a seller should separate procedurally and temporally
the mise en demeure and exercise of the revendication remedy. Not only would
delays in time jeopardize the seller’s remedy, but the possibility of manipulating
the procedure in this manner renders ineffectual any rule requiring that no term
exist at a time immediately preceding the exercise of the remedy.

Le premier juge a dcid6 que la question de savoir s’il y avait terme ou non ne semblait
pas importante, parce que la d6fenderesse principale … avait reconnu son insolvabilit6
… ce qui, d’apr~s lui, entranait la perte du b6n6fice du terme. Avec d6f6rence, je ne
puis accepter l’opinion du premier juge sur ce point, car elle va A l’encontre de l’une
des conditions formelles de l’article 1999 C.C. qui exige que la vente ait 6t6 faite sans
terme et non pas que le d~biteur ait perdu le b~n~fice du terme.

’84See text accompanying notes 60 and 206.
185 As indicated above, a seller’s right of revendication is not enforceable against a buyer’s

trustee in bankruptcy. See text accompanying notes 23-24.

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[Vol. 35

The only logical, consistent and meaningful interpretation of article
1999(1) C.C.L.C. in this regard is that a term must not have been granted at any
time preceding the remedy. Yet, this expansive interpretation indicates that for
the purposes of revendication, a seller who has expressly or impliedly given a
term thereby has waived the benefit of the rule in article 1092 C.C.L.C. This is
unreasonable in that the mere giving of a term to a buyer does not indicate any
such waiver because the premise of article 1092 C.C.L.C. is precisely the exis-
tence of a term for payment. The same paradox results from the decision in
Fiducie du Quibec v. Fabrication Precision Inc.'”6 Hence, there is no truly sat-
isfactory solution to the problem of how article 1092 C.C.L.C. applies in the
context of a seller’s revendication remedy. The technical contradictions dis-
cussed above result in part from the uncertainty of article 1999(1) C.C.L.C. as
to the timing of a term. They also result from the coincidence of two contradic-
tory rules. Article 1999(1) C.C.L.C. states that the revendication remedy is
extinguished by the existence of a term for payment. Article 1092 C.C.L.C. indi-
cates that a term for performance does not extinguish remedies, but merely
delays their enforcement. It is impossible to reconcile these rules. Yet, at pres-
ent, in light of the decision in Fiducie du Quebec v. Fabrication Precision
Inc., s7 the rule in article 1999(1) C.C.L.C. prevails. The result is that article
1999(1) C.C.L.C. creates an absolute bar to the revendication remedy in all
cases including a buyer’s insolvency and would create an absolute bar if reven-
dication were enforceable in the case of a buyer’s bankruptcy. 88 As previously
mentioned, 89 this result as regards article 1092 C.C.L.C. is inconsistent with the
seller’s other non-consensual remedies.

The above analysis indicates that a sale on credit or with a term arises by
implication whenever a seller voluntarily delivers goods to a buyer without
receiving payment. It is important to note that payment in the context of sale
means payment in cash.’ 9 Hence, any voluntary delivery by a seller without

186Supra, note 4.
117Ibid.
’88in France, as regards goods sold to a commergant, this problem has been finessed by amend-
ment to the Code de commerce. According to art. 62 of Loi no 67-563 diu 13 juilet 1967, J.O. 14
juillet 1967, Gaz. Pal. 1967, 2e sem. L6g. 75, a seller’s revendication remedy is available until the
goods sold are placed in a publicly prominent situs of the buyer. Until this event has occurred,
delivery is deemed not to be complete and any custodial remedy exercised by a seller falls outside
the ambit of art. 2102(4), para. 2 C.C., the French equivalent of art. 1999 C.C.L.C. In this way,
art. 1188 C.C., the French equivalent of art. 1092 C.C.L.C., can apply to sales on credit so as to
reactivate a seller’s custodial remedy. See Fridman-Clausse, supra, note 3, paras 27, 45-55. These
amendments implicitly recognize the contradictions inherent in the codal revendication remedy
discussed above.

‘t 9See text accompanying notes 31 and 36.
I90See art. 1472 C.C.L.C.; Rousseau-Houle, Precis du droit de la vente et diu louage, supra, note
1 at 13, 80-82, 194; Pourcelet, supra, note 1 at 79-81; Faribault, supra, note 2 at 19-20, 25ff. It
should be noted that where as a result of multiple transactions a buyer and seller are mutually

1989]

SELLER’S REVENDICATION REMEDY

receipt of payment in cash is a sale with a term which extinguishes the right of
revendication. In this context, the use of negotiable instruments as a payment
mechanism is of particular interest.

As a rule, the issuance of a negotiable instrument by a debtor and its deliv-
ery to a creditor do not constitute payment, nor, more specifically, payment of
the purchase price under a contract of sale. For example, a cheque, whether cer-
tified by its drawer or holder, or noncertified, is merely an order by its drawer
addressed to a bank authorizing it to pay on demand the sum indicated to the
payee. 9′ While certification might entail debiting the amount of the cheque
from its drawer’s account at the drawee bank and imposing liability on the
cheque upon the drawee bank, payment in favour of a payee or holder of a cer-
tified or noncertified cheque occurs only with the actual transfer of legal tender
or possibly the crediting of the account of the payee or holder.92 Hence, a cred-
itor traditionally has not been obliged to accept a cheque in lieu of actual pay-
ment. 93 The acceptance of a cheque in lieu of payment is deemed to be condi-

debtor and creditor of liquidated, exigible debts for sums of money, payment of the purchase price
by the buyer occurs by compensation. This mechanism for payment in cash is effected automat-
ically as soon as the mutual debts exist simultaneously and entails the mutual extinction of these
debts as far as permitted by their respective amounts. See arts 1187-1188 C.C.L.C. Hence, the only
forms of cash sales are those in which a seller receives cash or legal tender upon delivery, or com-
pensation occurs at that time. As regards payment by exchange goods see infra, note 198.

191See Bills of Exchange Act, R.S.C. 1985, c. B-4, s.165(1); Crawford and Falconbridge
Banking and Bills of Exchange, 8th ed. by B. Crawford, vol. 2 (Toronto: Canada Law Book, 1986)
at 1736-41; Byles on Bills of Exchange, 26th ed. by F Ryder & A. Bueno (London: Sweet &
Maxwell, 1988) at 281; Chalmers on Bills of Exchange, 13th ed. by D.A.L. Smout (London:
Stevens & Sons, 1964) at 247-48; B. Geva, “Irrevocability of Bank Drafts, Certified Cheques and
Money Orders” (1986) 65 Can. Bar Rev. 107 at 126; Cleveland Stove Co. v. Walters & Sons (1918),
54 C.S. 154 (C. of Rev.); Duval v Janvier (1934), 57 B.R. 481; Noad v. Lampson (1860), 9
R.J.R.Q. 379 (B.R.); Re J. Garmaise Ltd. & Lamarre (1939), 78 C.S. 275; Mount Royal Paving
& Supplies Ltd. v. Dompierre, [1954] B.R. 592; Millet v. The Queen, [1954] Ex. C.R. 562;
Ouellette v. Lepine (1952), [1953] C.S. 244.

192See as to the notion of payment of negotiable instruments and the effects of certification
Crawford and Falconbridge Banks and Bills of Exchange, ibid. at 1669-72, 1791-96; Byles on Bills
of Exchange, ibid. at 135-36, 3 10-11; Chalmers on Bills of Exchange, ibid. at 199, 249-50; Geva,
ibid. at 123-30; J.M. Deschamps, “Les comptes en banque au Qu6bec” (1986) 65 Can. Bar Rev.
75 at 91-94; Canadian Imperial Bank of Commerce v. Perrault Ltde, [1969] B.R. 958.
193SeeLavimodire v. Garidpy (1917), 51 C.S. 471 (C. ofRev.); Mount Royal Paving & Supplier
Ltd. v. Dompierre, supra, note 191; Dame Matte v. Dame Roger (1923), 35 B.R. 198; Baudouin,
supra, note 95 at 371; Pineau & Burman, supra, note 95 at 322-23; Tancelin, supra, note 95 at
489-90.

A recent amendment to art. 1163(4) C.C.L.C. regarding tender and deposit does not likely have
the effect of elevating the delivery of a certified cheque to the status of payment in cash under the
law of Quebec. The former art. 1163(4) C.C.L.C. provided:

It is necessary to the validity of a tender: … 4. That, if it be of money, it be made in
coin declared by law to be current and a legal tender…

According to s.2 of S.Q. 1987, c. 98 in force from December 18, 1987 (see G.O.Q. 1988.11.605),
art. 1163(4) C.C.L.C. now reads:

McGILL LAW JOURNAL

[Vol. 35

tional upon the existence of sufficient funds in the appropriate account and
payment of the cheque by the drawee bank upon presentment by the payee or
holder.”9 Hence a creditor’s acceptance is acknowledgement that delivery of a
cheque is conditional performance of the debtor’s payment obligation. In the
event of non-payment of a cheque, payment is deemed never to have occurred.
In the context of sale, acceptance by a seller of a cheque or bill of exchange
in lieu of payment upon delivery indicates waiver of the right to demand pay-
ment in cash upon delivery and consequently an implied intention to accord a
term for payment. The same result arises if the seller accepts a demand prom-
issory note upon delivery because this form of negotiable instrument is a prom-
ise to pay, which between immediate parties is merely evidence of the underly-
ing debt.” Similarly, acceptance by a seller of an irrevocable bank draft, money
order or letter of credit indicates an intention to accord a term for payment
because delivery of these documents does not entail payment. 196 An implied
term for payment would also arise to the degree that an electronic fund transfer
delays actual payment to a seller beyond delivery to a buyer.’97

Further, it appears that an implied term for payment extinguishes a seller’s
revendication remedy in most situations where delivery is obtained through
fraudulent non-payment by a buyer.’ 98 The most common examples of fraudu-

It is necessary to the validity of a tender: … 4. That, if it be of money, it be made in
cash or by certified cheque…

Tender and desposit (see arts 1162-68 C.C.L.C.; arts 187-91 C.C.P.) is a mechanism by which inter
alia a debtor can pay a sum of money to a creditor despite the latter’s refusal to receive payment.
According to art. 1162 C.CL.C., deposit of a sum of money is equivalent to payment as of the date
of offering or tendering payment if the debtor continues to be ready and willing to pay the sum
of money. Tender and deposit discharges a debtor as of the date of tender and reduces his liability
for late payment and for the costs of suit, if any. Nonetheless, strictly speaking, this mechanism
makes payment available to a creditor but does not entail actual payment until the creditor receives
the money in cash. Seen in this light, tender and deposit of a certified cheque according to the
amended art. 1163(4) C.C.L.C. is not actual payment and does not conflict with the regulation of
cheques under the Bills of Exchange Act (supra, note 191.).
194See Mailloux v. Beaudry (1915), 48 C.S. 9 (C. of Rev.); Noad v. Lampson, supra, note 191;
Tancelin, ibid. See as to the acceptance of cheques being conditional upon payment in the common
law of sale of goods, M.G. Bridge, Sale of Goods (Toronto: Butterworths, 1988) at 31, 404, 683.
195See Bills of Exchange Act, supra, note 191, s. 176(l); Marzitelli v. Lahaie [1943] B.R. 527;
196See Geva, supra, note 191 at 108, 111, 122, 131-32, 143-44; Crawford and Falconbridge
Banking and Bills of Exchange, vol. 1, supra, note 191 at 834-47, 878-80, 1005-07; P.R. Trudeau,
“Les garanties contractuelles 6rigdes des exportateurs qudbdcois de biens et de services” (1985) 45
R. du B. 163.
197At present, there is some controversy as to when electronic fund transfers actually effect pay-
ment to a payee. See N. L’Heureux, “Le transfert 6lectronique de fonds en regard du contrat ban-
caire” (1986) 65 Can. Bar Rev. 147 at 152-54.
198Excluded from this analysis is the fraudulent non-payment which might arise in the context
of a contract of exchange under arts 1596 to 1599 C.C.L.C. Fraudulent non-payment would arise
in this context where one party transfers goods knowing that his title in them is defective or non-

Bank of Toronto v. Hingston (1868), 12 L.C.J. 216 (C.S.).

19891

SELLER’S REVENDICATION REMEDY

lent non-payment as an inducement for delivery are the issuance of an N.S.F.
cheque by a buyer with knowledge of the insufficiency of funds’99 and the issu-
ance of an order to “stop payment” of a cheque.2″ In both of these cases, the
initial acceptance by a seller of a cheque in lieu of payment and in exchange for
delivery implies the granting of a term for payment for reasons explained above.
The buyer’s fraudulent non-payment increases the scope of his liability in dam-
ages for non-performance”‘ and activates the other non-consensual remedies
available to a seller for non-payment after delivery. The buyer’s fraud does not,
however, displace the seller’s initially implied intention to waive the buyer’s
obligation to pay in cash upon delivery. 2

The only situation imaginable in which an implied term for payment does
not exist in a case of non-payment upon delivery is where a buyer pays with
counterfeit currency. In this extreme case, whether or not there is fraud by a
buyer, the seller’s intention is to deliver only in exchange for actual payment.2 3
Hence, according to the present analysis of article 1999(1) C.C.L.C., the scope
of the seller’s revendication remedy is limited to the case of delivery in
exchange for payment by counterfeit currency. Consequently, for all intents and
purposes, the rule in article 1999(1) C.C.L.C. renders the seller’s revendication
remedy non-existent.

existent. In this case, the person receiving the goods or “buyer” would be able to invoke the rel-
ative nullity under art. 1487 C.C.L.C. or the remedy for breach of his “seller’s” warranty against
eviction under arts 1598 and 1508-21 C.C.L.C. Further, it is not likely that a seller’s revendication
remedy applies to an exchange party under a contract of exchange for two reasons. First, art. 1599
C.C.L.C. states that the rules contained “in the title Of Sale” apply to exchange. The right of reven-
dication is not found within that title of the Civil Code of Lower Canada. Second, the rules of priv-
ileges, which include the seller’s revendication remedy, are to be interpreted restrictively. Hence,
it is doubtful that one can extend the revendication remedy to the contract of exchange.

Polygraph-Export G.M.B.H., [1963] C.S. 679; Wilson v. Doyon, [1964] C.S. 93.

199E.g. Inns v. Gabriel Lucas LDe, [1963] B.R. 500; Kuhne and Nagel (Canada) Ltd. v.
200E.g. Gstrein v. Dukel Auto Inc., [1978] C.P. 188; Bonin v. Banque Internationale de

Commerce S.A. (22 October 1986), Montreal 500-09-000772-830, J.E. 86-115 (C.A.),

20’See arts 1074, 1075 C.C.L.C.; Pfeuti v. Bahler et Schaub (1987), 11 Q.A.C. 101; Baudouin,
supra, note 95 at 429; Pineau & Burman, supra, note 95 at 439; Tancelin, supra, note 95 at 446.
202This result is analogous to the rule that art. 1092 C.C.L.C. does not apply to re-activate a
revendication remedy extinguished by the initial existence of a term. See text accompanying notes
182 and 183.
203According to s. 420(1) of the Criminal Code, counterfeit money belongs to the Federal
Crown. Accordingly, this money could be seized by the Crown in the hands of a seller, presumably
without compensation. Further, payment by a buyer using counterfeit currency would be non-
payment because such currency does not belong to the-buyer. Hence, with or without a buyer’s
fraudulent intent, the use of counterfeit currency constitutes non-payment.

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5. Critique and Response

The thesis of this paper, that article 1999(1) C.C.L.C. renders the seller’s
revendication remedy non-existent, can be criticized on two related bases. The
first argument is that an omni-present term implied in cases of delivery without
payment is mere technical legal wizardry and counter-intuitive as regards the
process of the sale of moveables. The second and related argument is that this
thesis is contradicted by case law which enunciates a presumption against credit
or terms for payment in sale.

The argument based upon the process of sale is not merely a negation of
the implied intention of a seller to accord a term for payment, it is recognition
of the fictional and unrealistic nature of simultaneous and reciprocal obligations
in synallagmatic contracts. In practical terms, payment of the price and delivery
of goods are rarely truly simultaneous. At the very least, there is always some
divergence in the performance of these reciprocal obligations. The fiction of
simultaneity of performance likely reflects the formalism of sale in Roman law.
Further, in a modem context, it symbolizes the causal link between payment and
delivery which permits exceptio non adimpleti contractus and the dissolution
remedy in favour of a non-defaulting party.2′ Assuming simultaneous perform-
ance to be merely symbolic in this sense, it can be argued that there must be
some margin for non-simultaneous performance which does not entail an
implied term and extinction of the remedy. A strict rule of simultaneity of per-
formance leads to a stand-off in which neither party performs, anticipating non-
performance by the other. An analogous but inverse margin exists in favour of
a seller who can withhold delivery on the basis of reasonably imminent or hypo-
thetical non-payment of the purchase price by a buyer. 5

In the context of a seller’s revendication remedy, the margin as regards
simultaneity is found in article 1999(4) C.C.L.C. which states that the remedy
must be exercised within eight days of delivery. Even in a purely modem con-
text, this rule indicates that a seller can deliver goods without receiving payment
and wait a maximum of eight days to demand return of the goods for non-
payment.2′ In other words, despite delivery without payment, a seller is deemed
to have given a term for payment and forfeited the remedy only if he does not
pursue his buyer for eight days. This period of time is sufficient to permit a
seller to accept and clear payment in the form of a cheque, for example. In this
way, a seller’s acceptance of the cheque does not cause forfeiture of the reven-
dication remedy which acts as a disincentive to payment with N.S.F. cheques or

24See text accompanying notes 147-50.
205See Boodman, “The Right of Retention of the Seller of Moveables in Quebec”, supra, note
1 at 674-75.
206See Henderson v. Tremblay (1876), 21 L.C.J. 24 (B.R.); Pourcelet, supra, note 1 at 174.

1989]

SELLER’S REVENDICATION REMEDY

generally to non-payment upon delivery. The eight-day rule preserves the sel-
ler’s post-delivery remedy for a short but sufficient duration and relieves him
of the pre-delivery costs of screening prospective buyers as regards their sol-
vency.207

As a specific codal exception to the civil law notion of an implied term,
however, the eight-day rule is incompatible with article 1999(1) C.C.L.C. and
underscores its paradoxical nature. Essentially, article 1999(4) C.C.L.C. implies
a maximum eight-day term for payment as regards the seller’s revendication
remedy. This is contrary to the rule in article 1999(1) C.C.L.C. and makes it
impossible to determine the scope and the purpose of this provision. In the face
of article 1999(4) C.C.L.C., article 1999(1) C.C.L.C. is superfluous and mean-
ingless. Consequently, the possible critique of this paper based on the process
of the sale of moveables is well-founded and supported by the eight-day rule in
article 1999(4) C.C.L.C. However, at the same time, this critique supports the
view that article 1999(1) C.C.L.C. is anathema to the seller’s revendication
remedy.

The second potential argument against the thesis of this paper is that it is
contrary to the few Quebec cases which have considered the availability of the
seller’s revendication remedy in light of article 1999(1) C.C.L.C. and implied,
as opposed to express, terms for payment. In fact, there are post-codification
authorities concerning revendication actions in Quebec which state that sale is
presumed to be a cash transaction and that delivery of goods accompanied by
a de facto delay for payment does not create a sale on credit.208 Perhaps the
clearest statement of the rule emanating from these cases is found in the deci-
sion of Re Win. A. Marsh Co. v. Buzzell.2 9 In this case, several unpaid sellers
claimed repossession of goods sold and delivered less than thirty days before
the bankruptcy of the buyer. The seller’s claims were contested by a bank with
security under section 88 of the Bank Act.210 In accordance with prior court
authorization, the trustee in bankruptcy used the goods claimed to complete
work in progress of the bankrupt debtor. Hence, the bank and unpaid sellers
were competing de facto for the monetary value of the goods. As regards the
cash or credit nature of a contract of sale, Gibsone J. states:

207See as regards screening costs in secured transactions F.H. Buckley, “The Bankruptcy Priority

Puzzle” (1986) 72 Vir. L.R. 1393 at 1451-60.

20SSee Re Win. A. Marsh Co. v. Buzzell, supra, note 13; Re Rosenzweig: Hart v. Goldfine Ltd.,
supra, note 17 at 562-63, Tellier J.; Dame Hyatt v. Herlihy (1916), 50 C.S. 163 (C. of Rev.) at
183-84, Bruneau J., dissenting; Allan v. Francoeur (1895), 8 C.S. 466 at 468; Brown v.
Hawksworth (1869), 14 L.C.J. 114 (B.R.) at 118-20, Badgley J., dissenting; Blagdon v. Lebel
(1878), [1879] 5 Q.L.R. 87 (B.R.); Mercure v. Philippe Beaubien & Cie, supra, note 31 at 417,
Tremblay J.; Martineau v. Plante (1916), 50 C.S. 102 at 103.

2 09lbid.
2 10R.S.C. 1927, c. 12.

McGILL LAW JOURNAL

[Vol. 35

Sales may be made for immediate payment or on credit; a sale is on credit when
the express (or sufficiently established tacit) agreement between the parties is that
the buyer becomes owner of the thing at once but that the seller may not call for
payment of the price until after a definite delay; a sale is not presumed to be on
credit, on the contrary there is a general presumption of law that sales of moveable
property, including merchandise, are made for cash and for immediate payment;
the fact that a seller does not insist upon immediate payment and that (presumably
as a matter for convenience) he allows payment to be delayed for some short
period does not of itself make the sale to become a sale on credit, nor deprive the
seller of the right to ask for payment at any time;
A consequence of the seller’s right to payment on delivery is that, if the price is
not paid, within eight days in ordinary cases, within thirty days in cases of bank-
ruptcy, the seller is entitled to recover back the thing sold, but he can do this only
provided it is entire and in the same condition and provided it has not been bought
and paid for by a third party; this right of the vendor to recover back the thing sold
constitutes a lien upon it.211
Despite the ostensibly clear import of these dicta, their reliability is ques-
tionable for several reasons. First, Gibsone J. provides no reasoning or authority
for his statement that a short delay for payment upon delivery does not consti-
tute a term by implication. The legal presumption that sale is a cash transaction
is merely a restatement of the rule in article 1533 C.C.L.C. which can be dis-
placed by the express or implied intention of the parties to the contract. Further,
the statement that a delay for payment does not deprive the seller of the right
to demand payment at any time is tautological. As indicated above,12 an indef-
inite, implied term created by delivery without payment can be fixed by a mise
en demeure which can take the form of an express demand for payment.

Of greater consequence is the fact that the decision in Re Wm. A. Marsh
Co. seems to give priority to the unpaid sellers based on their ownership of the
goods. This is indicated by the following statement:

The fact that the customer might have, either erroneously or falsely, represented
to the bank that he was owner, when he was not, would not deprive the real owner
of his rights. 213

The ownership basis of this decision is also indicated by its conclusion which
permits “the unpaid vendors to be collocated in preference to the bank for the
value of their merchandise.”2 4 Even the headnote to the decision supports the
ownership basis for the sellers’ priority. It reproduces article 1543 C.C.L.C.
which enunciates a seller’s right to dissolve a contract of sale for non-payment
of the price.” 5 The headnote to Re Wm. A. Marsh Co. also refers to the case of

21 Supra, note 13 at 466-67.
2 12 See text accompanying notes 133-46.
213Supra, note 13 at 466.
2141bid. at 468 (emphasis added).
2151bid. at 463-64.

1989]

SELLER’S REVENDICATION REMEDY

Re Rosenzweig: Hart v. Goldfine Ltd.216 in which a majority of the appeal court
decided that the remedy under article 1543 C.C.L.C. is enforceable against a
buyer’s trustee in bankruptcy. Further, in the recent case of Knitrama Fabrics
Inc. v. K. & A. Textiles Inc.21 7 the decision in Re Win. A. Marsh Co. was judi-
cially considered to be based upon article 1543 C.C.L.C. This interpretation is
consistent with the contemporary view that the seller’s dissolution remedy
under article 1543 C.CL.C., but not the revendication remedy, is enforceable
against a bank with security under the Bank Act.2″8

A seller’s ownership of goods is the common basis of all of the revendi-
cation cases which enunciate a presumption against sale on credit and deny an
implied term for payment based on delivery without payment.219 In fact, unlike
the case of Re Win. A. Marsh Co. which is fairly subtle in this regard, the other
authorities specifically state that the presumption against credit sale preserves a
seller’s ownership of goods delivered and right to revendicate them. In other
words, the post-codification authorities, contrary to the thesis of this paper,
adopt the pre-codification regime of sale in which ownership of moveables does
not transfer upon delivery unless a seller receives payment or adequate security,
or gives a term for payment.” Under this regime, a seller’s ownership of goods
delivered is the basis for a right of revendication. In a post-codification context,
however, the existence of a term for payment has no effect upon the consensual
transfer of ownership in sale. Hence, post-codification decisions such as Re Win.
A Marsh Co.” cannot be justified as a means of restricting implied dispositions
of property. It is obvious that these cases misconstrue the basis for the nature
of the seller’s revendication remedy or confuse it with the distinct remedy of
dissolution of a contract. 2 Otherwise, the only rationale for these cases is the
avoidance of the paradox created by article 1999(1) C.C.L.C. In fact, by their
refusal to consider implied terms in the context of article 1999(1) C.C.L.C.,

2161bid. at 464.
217Supra, note 13 at 1206-07.
2l8See authorities cited in note 13.
2t 9See authorities cited in note 208.
22See as to pre-codification, Quebec cases regarding a seller’s revendication remedy Sinclair
v. Ferguson (1858), 2 J. 101, 6 RJ.R.Q. 227 (C.S.); Sgnical v. Mills (1860), 4 J. 307, 8 R.J.R.Q.
262 (C.S.); Moor v. Dyke (1833), S.R.C. 538, 1 R.J.R.Q. 399 (B.R.); Aylwin v. McNally (1812),
1 R. de L. 506, 1 R.J.R.Q. 401 (B.R.).

221Supra, note 13.
2nAs to the distinct nature of the seller’s post-delivery dissolution remedy under article 1543
C.C.L.C. compared to that of revendication see art. 1543, para. 1, infine C.C.L.C.; Macdonald,
supra, note 1 at 341; Boodman, “The Prepaying Buyer of Corporeal Moveables in Quebec”, supra,
note 1 at 918; Rousseau-Houle, Precis de droit de la vente et du louage, supra, note 1 at 206;
Pourcelet, supra, note 1 at 173; Mignault, supra, note I at 143-48; Rousseau-Houle, “Les r6cents
d6veloppements dans le droit de la vente et du louage de choses au Qubec”, supra, note 1 at
377-78; Faribault, supra, note 2 at 353; Re Beatrice Pines Ltd: Vendome Knitting Mills Ltd. v.
Lawrence, supra, note 17; Re Rosenzweig: Hart v. Goldfine Ltd, supra, note 17; Re Iberville
Furniture & Appliances Co. Ltd.: Grosbtein v. Facto, supra, note 17.

REVUE DE DROIT DE McGILL

[Vol. 35

these authorities implicitly recognize or, at least serve to illustrate, that article
1999(1) C.C.L.C. effectively eliminates the seller’s right of revendication.

By contrast to these authorities, the decision of Brown v. Hawksworth2n
supports the present analysis. In this decision Caron J.A. in the majority of the
Court of Appeal states:

…ce n’est qu’au cr6ancier qui vend sans termes et sans cr6dit que le droit de reven-
diquer est accord6. Or, ]a question se r6soudrait A savoir si dans l’esp~ce la vente
a 6t6 faite h cr6dit ou pour argent comptant. Suivant la preuve, il me paralt que
c’est A cr6dit, puisque les effets sont par les vendeurs expddi6s de Sheffield A
Liverpool, h l’agent reconnu et admis des acheteurs, sans qu’on exige d’eux ni de
personne autre le prix desdites marchandises, lesquelles sont exp6di6es de nou-
veau par ledit agent, aux acheteurs A Montr6al, pour 8tre livr6es aux acheteurs eux-
m~mes, sans qu’il y ait aucune preuve que les vendeurs eussent, sur les lieux t
Montr6al, qui que ce soit pour retenir les effets jusqu’au paiement; au contraire,
c’est t eux qu’ils sont adress6s et c’est par eux et en leur nom qu’ils sont d6posds
Sl’entrep6t, non pour ]a siret6 du prix desdites marchandises, mais bien et unique-
ment pour la sfiret6 des droits de douane. Si tous les faits et cette mani6re d’agir
ne constituent pas une vente t cr6dit je ne sais pas vraiment ce qu’il faut pour en
faire une. Si je suis fond6 dans cette appr6ciation des faits et de la loi sur le sujet,
la cons6quence est que dts l’instant que les vendeurs se sont dessaisis de leurs
marchandises en les exp6diant A Liverpool sans exiger le paiement ils ont pour
toujours perdu le droit de revendication;… 224

This case is interesting not only because it addresses the issue of implied credit
and raises the problem under pre-codification law, but also because its dissent-
ing opinion invokes the almost irrebuttable presumption against implied credit
in sale.’
It is in fact the only case in which both sides of the issue are consid-
ered, albeit superficially.

This historical link between revendication and a seller’s ownership has
prompted some doctrinal authorities to suggest that the remedy is an oversight
of codification incompatible with the consensual transfer of ownership in sale.226
Given the historical importance of a term for payment or credit vis-Ih-vis the
transfer of ownership in sale, this modem incompatibility is essentially the par-
adox created by article 1999(1) C.C.L.C.

223Supra, note 208.
2241bid. at 115. This dictum assumes that delivery occurred when the goods were transferred to
the buyer’s custom house broker. The alternate basis for the majority decision is that the revendi-
cation remedy was taken more than fifteen days after delivery contrary to the Insolvent Act of 1864,
Statutes of the Province of Canada, 27-28 Vict., c. 17, s.12, para. 1.

2251bid. at 118, Badgley J.A., dissenting.
226See Fridman-Clausse, supra, note 3, No. 2; Rousseau-Houle, “Les rdcents d6veloppements
dans le droit de la vente et du louage de chose au Qu6bec”, supra, note I at 377; Mignault, supra,
note 1 at 143-48; Mazeaud, Mazeaud & Chabas, supra, note 3, no. 187; M. Planiol & G. Ripert,
Traitipratique de droit civilfrangais, 2d ed. by E. Becqu6, vol. 12 (Paris: L.G.D.J., 1953), no. 188
at 215.

1989]

SELLER’S REVENDICATION REMEDY

It can also be argued that the revendication remedy embodied in articles
1998 and 1999 C.C.L.C. exists and is recognized to exist by virtually all author-
ities regarding the unpaid seller’s non-consensual remedies. 7 To accommodate
the consefisual transfer of ownership in sale, the modem authorities dissociate
revendication from ownership and append it to the seller’s quasi-custodial right
of retention.2″ Contemporary authorities do not challenge the viability of the
seller’s right of revendication. Nor do they contemplate the paradox inherent in
article 1999(1) C.C.L.C.

The unqualified acceptance of the seller’s revendication remedy results
from basic civil law principles regarding codal interpretation and the non-
consensual secured status of the unpaid seller of moveables. As stated previ-
ously, 9 article 1999(1) C.C.L.C. is not ambiguous on its face and consequently
appears not to require in-depth interpretive analysis in an historical or modem
context. Hence, it is far from obvious that the historical basis for the seller’s
revendication remedy is incompatible with post-codification rules of sale. Nor
is it obvious that the paradox surrounding credit or terms for payment in sale
exists in both an historical and a modem context.”0 Further, the concept of an
error or oversight of codification is anathema to codal interpretation. There is,
with some justification, an almost irrebuttable presumption that the provisions
of a civil code contain a coherent and intelligible set of rules. Codal interpreta-
tion as a means of filling in lacunae, resolving ambiguities and modernizing
codified rules based upon internally expressed and implicit principles cannot
accommodate unavoidable paradoxes such as that in article 1999(1) C.C.L.C. It
is not surprising, then, that there has been no perceived need to examine criti-
cally article 1999(1) C.C.L.C.

Interpretations of article 1999(1) C.C.L.C. which justify the existence of
the revendication remedy are also supported by a traditional civil law bias in
favour of the unpaid seller of moveables. The classic justification for the non-
consensual privileged status of the unpaid seller of moveables is that goods sold
enhance the patrimony of the buyer-debtor to the benefit of his creditors and

2 7See for example Rousseau-Houle, Pricis du droit de la vente et du louage, supra, note 1 at
200-02; Rousseau-Houle, “Les r6cents d6veloppements dans le droit de la vente et du louage de
choses au Qu6bec”, supra, note 1 at 377-81; Ciotola, supra, note 2 at 169-73; Pourcelet, supra,
note 1 at 173-74; Boodman, “The Prepaying Buyer of Corporeal Moveables in Quebec”, supra,
note 1 at 896-97, 918-21; Boodman, “The Right of Retention of the Seller of Moveables in
Quebec”, supra, note 1 at 659, 694-95; Atlas, supra, note 173 at 607-09; Faribault, supra, note 2
at 353; Mignault, supra, note I at 146-47; Goldstein, supra, note 1 at 91, 97; Macdonald &
Simmonds, supra, note 2 at 261, 262-63; Macdonald in Springman & Gertner, eds, supra, note 1
at 341-42; Macdonald, supra, note 3 at 1055-56, 1058, 1060; Macdonald, supra, note 2 at 11-12.

228See authorities cited in note 3.
229See text accompanying note 94.
23See as regards allusions to the problem of credit in an historical context authorities cited in

note 79.

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[Vol. 35

detriment of the unpaid seller.”
It is to offset this economic inequity that the
seller is accorded the privileged rights of revendication and preference on the
proceeds of judicial sale of the goods sold. This justification for the seller’s non-
consensual secured status is based on the concept of ownership of moveables.
However, like the unpaid seller, lenders enhance the patrimony of a borrower-
debtor to their own detriment and to the benefit of the borrower’s other credi-
tors. These creditors benefit from their debtor’s added liquidity or from assets
purchased with the funds advanced. The only possible rationale for a non-
consensual secured status in favour of the unpaid seller of moveables as
opposed to the lender of funds is that the ownership of moveable property, quite
apart from the value of the moveable owned, is inherently more valuable than
other patrimonial assets, for example currency. In other words, the non-
consensual secured status of the seller of moveables seems to be based upon the
reification of the seller’s debt and the buyer’s right of ownership in particular,
identifiable, corporeal assets.”3 It is doubtful that the enhanced stature of the
right of ownership as opposed to a right of debt is a valid justification for the
non-consensual nature of a seller’s secured status. 3 While this non-consensual
secured status might not be justified, it is, however, consistent with the priority
of the seller’s purely contractual remedies of retention and dissolution, the
enforcement of which is greatly enhanced specifically because of the ownership
component in the contract of sale. 4

Rightly or wrongly, the codal provisions regarding the unpaid seller’s non-
consensual privileged rights reflect a principle of protection toward the seller of
moveables which underlies the unqualified acceptance of the revendication rem-
edy. The paradox of article 1999(1) C.C.L.C. results from the unresolvable con-
flict between the principle in favour of an unpaid seller as creditor and that in
favour of debtors generally which gives rise to the rules regarding implied terms

231See Fridman-Clausse, supra, note 2, No. 13; Bushnell Co. v. Baldwin (1894), 8 C.S. 395;
Mechanic Supply Co. v. Hudon, supra, note 32 at 403; Re Rosenzweig: Hart v. Goldfine Ltd.,
supra, note 17; J. Blumenthal, Droits du vendeur non payi (Paris: A Giard, 1880) at 1-2; Planiol
& Ripert, supra, note 226 at 215-16; Mazeaud, Mazeaud & Chabas, supra, note 3 at no. 187.
32This reification of rights into assets can also explain the non-consensual special privileges
accorded creditors with a right of retention (see art. 441 C.C.L.C.) and the owner of goods lent,
leased, pledged or stolen (see art. 1994(8a) C.C.L.C.).

233The argument here is that any secured status accorded an unpaid seller of moveables should
be consensual and result from the intention of the parties to the contract of sale. While it is argued
that the justification for the non-consensual secured status of the unpaid seller is invalid, this does
not address the question of the superior priority of a seller’s secured status vis-h-vis competing
creditors of a buyer who have security on future or after-acquired property. In this regard, see for
example T.H. Jackson & A.T. Kronman, “Secured Financing and Priorities Among Creditors”
(1979) 88 Yale L.J 1143; Buckely, supra, note 207 at 1461-66.

2-4See as to the common contractual basis for a seller’s dissolution and retention remedies
Boodman, “The Right of Retention of the Seller of Moveables in Quebec”, supra, note 1 at 695.

1989]

SELLER’S REVENDICATION REMEDY

and putting in default as discussed above. 35 In a modem context, the conflict
between these two principles renders article 1999(1) C.C.L.C. meaningless and
the entire revendication remedy of the seller non-existent. Assuming that one
can justify a remedy enforceable against competing third parties which permits
an unpaid seller of moveables to retake them after delivery for non-payment of
the purchase price, this need is amply fulfilled by the seller’s dissolution remedy
under article 1543 C.C.L.C.36 The inevitable conclusion is that within the pres-
ent model of security on moveables in Quebec the demise of the seller’s reven-
dication remedy due to the pardox inherent in article 1999(1) C.C.L.C. is not a
grievous loss.237

Conclusion

An historical and modem analysis of the seller’s right of revendication
under articles 1998 and 1999 C.C.L.C. indicates that within the Quebec move-
able security model, the remedy is a fossil or relic of a bygone era. In a legal
context, fossilization, as opposed to evolution, occurs by a process of compres-
sion over time of competing principles underlying conflicting rules of law. In
the case of the seller’s revendication remedy, this process results from the pro-
tection of debtors through the rules regarding terms and putting in default and
the protection of unpaid sellers through privileged remedies, reinforced by the
consensual nature and obligational structure of the contract of sale. The endur-
ance of the rule in article 1999(1) C.C.L.C. in a modem context is extraordinary
because allusions to its paradoxical nature exist in the Codifiers’ sources for the
rule and in cases decided immediately prior to and after codification. The antip-
athy between a seller’s privileged remedies and credit sales is so tenacious that
recent proposals for reform of the contract of sale inexplicably append the rule
in article 1999(1) C.C.L.C. to the seller’s revendication remedy based upon
post-delivery dissolution, giving rise to the same paradoxes as those described
above.?3 s

text accompanying notes 4-33.

235 5ee text accompanying notes 116ff.
6See as regards the inferior status of the revendication remedy vis-A-vis the dissolution remedy
2
237Ironically, the seller’s right of revendication as a non-consensual remedy enforceable only
against a buyer is consistent with the view that any priority accorded a seller of moveables should
be consensual and subject to third party publicity. See supra, note 233.

238See Draft Bill, An Act to add the reformed law of obligations to the Civil Code of Quebec,
2d Sess., 33d Leg. Que., 1988, s.1 at art. 1791, para. 1. This provision reads as follows:”Except
in the case of a sale with a term, the seller of moveable property may within thirty days of delivery,
consider the sale dissolved and revendicate the property if the buyer has failed to pay the price and
property is still entire and in the same condition in the hands of the buyer.” Under the Draft Bill,
the salient features of the rules regarding terms (see Draft Bill, supra, at arts 1566-75), putting in
default (see Draft Bill, supra, at arts 1647-54, 1488, para. 2.) and payment (see Draft Bill, supra,
at arts 1611-25), as well as the obligational structure of the contract of sale (See Draft Bill, supra,
at arts 1756ff., particularly arts 1756 and 1780.) are not substantially different from the present

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[Vol. 35

In a broader perspective, an analysis of the seller’s right of revendication
suggests that fossilization is an inevitable, but often obscure, by-product of the
process of evolution of law. It is obscure because of the uncertain and fluctuat-
ing interdependencies of legal rules over time. Obscurity also results from a per-
ception and method of interpretation of law, which assume it to be, at any given
time, a perfect, complete and inherently consistent system divorced from its his-
torical precursors. The evolutionary process of law, however, is characterized by
both historicism and modernism. Fossilization is inevitable because it occurs
vis-t-vis a particular rule of law when these traits conflict as they must do from
time to time.

rules discussed above. The only possible innovation relevant to the present analysis of the seller’s
revendication remedy is the proposed expansion of the notion of payment as performance of the
obligation to pay a sum of money so as to include delivery of legal tender, money order, certified
cheque, credit card or “other similar instrument of payment, or … any other mode of payment
which relies on an electronic system for the transfer of funds, if the creditor is able to accept it.”
(See Draft Bill, supra, at art. 1622.). While this expansion of the notion of payment may substan-
tially reduce instances of sales on credit, as indicated above, the effect of this type of rule is as
yet uncertain. See supra, note 193.