Manitoba garage ordered to release leased truck after lien claim fails

A Manitoba truck-repair business must release a leased semi-truck and Mitsubishi HC Capital Canada Leasing Inc. will recover the money it paid into court, after a judge found the business had not established a valid garagekeeper’s lien.

In Mitsubishi HC Capital Canada Leasing Inc. v. A to Z Truck Parts Inc., 2026 MBKB 113, released August 19, 2026, Justice Monnin of the Court of King’s Bench of Manitoba found insufficient evidence that the person who requested the towing and repairs had authority to bind the truck’s lessee. The judge also concluded that, even if a lien had initially arisen, it was no longer enforceable after Mitsubishi used the statutory payment-into-court procedure.

The ruling requires A to Z Truck Parts Inc. to release and deliver the truck promptly and take reasonable steps to facilitate its recovery. It leaves open any contractual or other common-law claims the business may have for its services.

A repair bill and a truck held since 2023

Mitsubishi leased the 2022 International LT625 to Albaurak Logistics Inc. A to Z had held the truck since approximately January 19, 2023, claiming charges for towing, repairs and storage under Manitoba’s Garage Keepers Act.

An A to Z employee said a man he understood to be dispatching or acting as an operations manager for Albaurak asked the business to retrieve the truck after an accident. The employee said he later received instructions to repair the front axle, with further work to be completed in Ontario, and relied on previous dealings in expecting payment.

Communications eventually stopped. When Mitsubishi sought the truck’s return, a dispute developed over the charges, particularly storage. A to Z’s first invoice sought $42,601. Mitsubishi requested an updated total but received none before paying that invoiced amount, plus $50, into court on July 29, 2024.

A to Z refused to release the truck when Mitsubishi’s bailiff attended on August 1. It then issued a further invoice for $19,775 in storage charges. By January 2025, an auction notice asserted that $90,490 was owing. Those were amounts claimed by the business, rather than sums awarded by the court.

The lessee could authorize repairs, but agency was unproven

A to Z argued that Albaurak was effectively the owner under a financing lease, with Mitsubishi retaining title as security. It also argued that requiring direct authorization from a registered owner would undermine the legislation’s protection of garagekeepers and create impractical commercial results.

The judge agreed that this was a financing lease. Albaurak had responsibility for maintenance, repairs, insurance and damage, and an option to purchase the truck for its residual value. It therefore qualified as an owner able to authorize the services.

The difficulty was proving that the person who called A to Z had authority to act for Albaurak. The judge found no work orders, repair authorizations, emails, telephone records or other documents supporting the alleged instructions about this truck. The old email exchange offered to establish previous dealings concerned a different vehicle and other businesses. There was no evidence from the caller or an Albaurak representative addressing his authority.

A to Z bore the burden of establishing that authority and had not done so. While the legislation protects garagekeepers, the court held that the conditions creating a statutory lien must be strictly established. Possession and services alone could not allow an unauthorized third party to impose a lien on someone else’s vehicle.

Payment into court replaces possession as security

The judge separately considered the statutory process for recovering a vehicle while disputing a garagekeeper’s charges. That process substitutes money paid into court for the garagekeeper’s security in the vehicle. Once the required payment is made and notice served, possession must be surrendered.

A to Z argued Mitsubishi had underpaid because storage charges continued to accumulate. The judge accepted that an owner should not deliberately pay less than a known claim to defeat a lien, but found that had not happened here. Mitsubishi asked for the full amount claimed before making its payment. A to Z did not quantify additional charges until afterwards. The invoice’s warning that storage charges might accumulate did not establish a further amount actually claimed.

A garagekeeper may bring an action within 30 days of service of the payment notice to pursue its claim. A to Z did not do so and refused to surrender the truck. The judge rejected an interpretation allowing it to retain possession indefinitely while declining to use the statutory dispute-resolution process.

Other objections did not decide the case. Requirements concerning an acknowledgment of debt and registration applied when a garagekeeper voluntarily surrendered possession, which A to Z had not done. The separate notice requirement concerning a sale did not determine whether an otherwise valid right to detain the truck remained enforceable.

Refund and return ordered, further monetary relief refused

The court ordered Mitsubishi’s payment into court returned and awarded it costs under the applicable tariff, with the amount to be addressed if the parties could not agree.

It declined Mitsubishi’s request for additional statutory monetary relief arising from the continued detention, explaining that the proceeding raised questions of first impression about the Act’s interpretation and application.

The result is confined to the statutory lien and detention rights asserted on this record. The judgment expressly preserves any contractual or other common-law rights A to Z may have for the services it provided.