JACK BUCHAN BELIEVES THAT FINANCING LICENCES WILL STIMULATE BUSINESS
Jack Buchan, a partner of Cohen Buchan Edwards LLP, says that businesses that manufacture, transport, produce, harvest or generally provide services will find a new source of financing. These will be the licences that permit the business to carry on their business.
Until now in British Columbia only licences that permit harvesting timber and Christmas trees could be financed in accordance with the British Columbia Personal Property Security Act (“BC PPSA”). Jack Buchan and Brad Caldwell, both marine law lawyers, as committee members of the BC Maritime Section of the Canadian Bar Association, made representations to the British Columbia Ministry of Finance starting in June 2009 following the decision of the Supreme Court of Canada in Saulnier v. Royal Bank of Canada. They were requesting the British Columbia Government to change the definition of licence in the BC PPSA.
The reality, says Jack Buchan, is that the commercial fishing licence is often worth more than the fishing vessel. The banks would only finance the vessel. This is all going to change because the BC PPSA definition of licence will soon apply to many other types of licences, including fishing licences.
On November 22, 2011, the BC Legislature passed Bill 5 which expands the definition of licences under the BC PPSA. The amendments will come into force when proclaimed by regulation.
This all arose because of Mr. Saulnier, a Nova Scotia fisher, whose business faltered could not pay his creditors, including the Royal Bank, even though his four fishing licences were worth in excess of $600,000. The Supreme Court of Canada held that fishing licences can be used as security for loans pursuant to the Nova Scotia PPSA. This is good news for fishers who risk life and property to feed Canadians says Jack Buchan and for lenders who can now access additional security to facilitate loans to the fishing industry.
