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50 Cards in this Set
- Front
- Back
- 3rd side (hint)
Once the Mortgagor defaults on their mortgage, the Mortgagee commences a ______in court _____. |
FORECLOSURE ACTION to have the property sold to satisfy the debt |
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The procedural aspects of foreclosure actions are governed by: •The substantive law is found in: -______, R.S.A. 2000 cL-7 Part 5 – Enforcement of Mortgages and Agreements re Sale of Lands |
Rules of Court The Law of Property Act The Land Titles Act Sections 57 and 58
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The Land Titles Act Sections 57 and 58 state: On the transfer of land subject to a mortgage, the Transferee: 1.Is bound by _____ 2.Must indemnify the Transferor from ____ |
the terms of the mortgage any liability under the mortgage |
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This means that when a person ASSUMES a mortgage, he/she takes on ______as the original Mortgagor
•It is as though he/she signed the mortgage her- or himself |
the same responsibility and legal liabilities |
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The two aspects of the mortgage – the promise to pay and the charge on the land – give rise to two actions on default:
1.An _____ action (“_____”) against the 2.An _____ action (“______”) against _______. |
in personam. against the person Mortgagor personally for breach of promise to pay in rem. against the thing the land to have it sold to satisfy the mortgage debt
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Judgment is sought against the guarantor in the event |
there is a deficiency after the mortgaged property is sold |
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a JUDICIAL SALE |
In Alberta, the property can be sold only by way of a court order |
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In Alberta, a mortgage is a ______, NOT a ______. •The Plaintiff is asking the court to have _______ debt |
charge on the land transfer of land the mortgaged property sold and the sale proceeds applied to reduce the mortgage
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The court has the power to: 3 No sale becomes final until _____ |
Set the terms and conditions of the sale -Order that the property be listed for sale with a realtor -Order that the property be sold to the plaintiff Mortgagee it has been approved by the court |
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Formal process First, _____is filed •The defendant mortgagor has _____ days to file their _______. If so, the matter proceeds to various ______. |
STATEMENT OF CLAIM is filed.
•The defendant mortgagor has 20 days to file their STATEMENT OF DEFENSE.
•If so, the matter proceeds to various APPLICATIONS |
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After the defendant is _______, OR After a ______ is filed, OR After the ______ AND ________. the plaintiff is required to make an application in _____ for a _____ |
NOTED IN DEFAULT DEMAND FOR NOTICE STATEMENT OF DEFENSE Any APPLICATIONS have been resolved Master’s Chambers Redemption Order
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Redemption Order aka ______ This order provides: 2
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Redemption and Method of Sale Order This order provides:
1.The length of the redemption period; and
2.Upon the lapsing of the redemption period, instructions for advertising the property for sale and a deadline for tenders (offers to purchase) to be received |
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The length of the redemption period is the length of time |
the defendant has to redeem the mortgage by bringing it into good standing or by paying it out if the mortgage has matured |
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After the deadline for tenders has passed, it is necessary for the plaintiff to _____. •This happens whether or not ______. |
make a second application to Master’s Chambers to confirm details of the sale the property is sold to a successful tender or to the plaintiff
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When a plaintiff asks the court for an Order for Foreclosure, it is asking the court to _____. |
transfer TITLE to the mortgaged property into the plaintiff’s name in exchange for forgiveness of the debt |
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There are two effects of an Order for Foreclosure: |
1.Title to the property vests in the name of the MORTGAGEE free from all rights of the owner and free from all encumbrances registered on title after the mortgage 2.An Order for Foreclosure operates in FULL satisfaction of the debt |
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When an Order for Foreclosure extinguishes a debt – that’s it, there is no longer any debt There can be: 3 No - |
No judgment against the defendant Mortgagor -No judgment against any guarantors of the mortgage -No fight to pursue any other security pledged as collateral for the debt |
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If the Mortgagor has given collateral security, all collateral security must be realized _____ Once the order has been obtained, the debt is _____ and the plaintiff has no right to _____. |
BEFORE obtaining an Order for Foreclosure extinguished proceed on any other security
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It is possible for the plaintiff to go directly to an application for a _________ without having to first obtain a ______. |
Order for Foreclosure Redemption Order |
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No Redemption Order: 4 -When the defendant Mortgagor ______. -When the defendant Mortgagor ______. -If the mortgaged property is _____. -If the mortgaged property is _____ but not _____. |
signs a Quit Claim consents to a Final Order for Foreclosure abandoned raw land
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The covenant to pay is . |
the promise in the mortgage document to make all payments under the mortgage when they are due |
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In Alberta, the rights of the Mortgagee are limited to _______ (except in a limited number of cases!) You cannot sue the _____. |
the recovery of the land Mortgagor on the debt |
Mortgagor on the debt |
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FINAL ORDER FOR FORECLOSURE – debt is ______. All other cases, while you are prohibited from suing the Mortgagor for the debt, _____ Action can be taken against _____. |
extinguished Debt still exists any Guarantor of the debt or against any collateral security |
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If the property is INCOME PRODUCING, a _____. |
Receiver or Receiver/Manager can be appointed to capture the income from the property |
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Receiver vs Receiver Manager Receiver: can only _____.
•Receiver Manager: |
collect rents from the mortgaged lands takes over full control with all the powers of management and operation of the property |
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Depending on the security agreed upon, it is possible that a Receiver or Receiver Manager can be appointed _____. In this case, they are acting as _____ for the Mortgagee The Mortgagee is ____ for their actions |
under the agreement without any court involvement AGENT liable |
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Most commonly in foreclosure actions, a Receiver or Receiver Manager is appointed by ____. Their powers and duties are _____. They are _____and not ______. |
court order set out in detail by the court an officer of the court an agent of the Mortgagee |
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For small properties, the court may require the _____ to act as the Receiver in order to reduce costs In other cases, a _____ will be appointed as Receiver Manager |
Mortgagee management company nominated by the Mortgagee
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Any rents or profits recovered by the Receiver or Receiver Manager are applied as follows: 3 |
1.Receiver’s remuneration 2.Property taxes 3.Reduction of the mortgage debt |
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Any rents or profits recovered by the Receiver or Receiver Manager are applied as follows: 3 |
1.Receiver’s remuneration 2.Property taxes 3.Reduction of the mortgage debt |
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This right is called the EQUITY OF REDEMPTION The right of redemption continues until ____. |
The Mortgagor has the right to pay all arrears and costs owing under the mortgage to bring it into good standing or payout the mortgage in full if it matured the property is sold to a third party |
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In certain cases, subsequent encumbrancers have the same right to ______. •Upon payment, they have the _______in the mortgage assigned to them and they stand in the same shoes as the _____. |
redeem Mortgagee’s interest Mortgagee
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When a plaintiff Mortgagee makes an application for an Redemption Order, the Master will set a time limit within which _______. |
the defendant Mortgagor must redeem their property |
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If the Mortgagor fails to redeem during the time period, ______. During this time period, the plaintiff Mortgagee cannot ______. |
the property is advertised for sale take further steps in the foreclosure action
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The time fixed for redemption is: The court has the ability to ______ depending on the ______ and other factors set out in the statute |
1.One year for farm land 2.Six months for all other land decrease or extend the redemption period equity in the property |
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A mortgage will often contain a provision requiring the Mortgagor to _____ if the mortgage is paid out before the term Once a Statement of Claim has been issued seeking the full amount of the mortgage, a Mortgagor is entitled to _____. |
pay a penalty pay off the mortgage WITHOUT ANY PENALTY |
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When a mortgage is insured by the CMHC, prior to any payment from the CMHC to the Mortgagee, the CMHC requires the plaintiff Mortgagee to register a ______ and that ______. |
WRIT OF ENFORCEMENT for any deficiency judgment be assigned to the CMHC |
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Upon receiving instructions from your client, you need to: 3
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Open a file Check conflict system (for what?) -Review mortgage documents •Mortgage renewal agreements •Guarantees •Collateral security documents |
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Upon receiving instructions from your client, you need to: 3
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Open a file Check conflict system (for what?) -Review mortgage documents •Mortgage renewal agreements •Guarantees •Collateral security documents |
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Some mortgages or collateral security agreements (i.e., guarantees) require that a _____ prior to commencing legal action Often a Mortgagee will instruct the law office to _____, hoping ______. |
written demand be made send a demand letter that will be enough to get payment and not have to commence litigation
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Necessary searches 5 |
Title Taxes Personal Property Registry Condominium Corporation Corporate Registry |
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Items to check on the Title to the property:3 |
a)Current registered owner = Mortgagor ▪If not, obtain copies of all the different titles from the time the mortgage was registered up to the current date (along with the Transfers of Land that created those titles) b)Prior encumbrances ▪Write any prior encumbrancers to inquire as to the balance owing on their security ▪Important to know what equity the Mortgagor has in the property c)Subsequent encumbrances ▪Notice of the applications must be sent to all subsequent encumbrancers |
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Search the taxes to the property, make sure ____. _____ will have priority over the mortgage debt |
they’re current Any tax arrears |
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Personal Property Registry
Search to see if |
any chattels form part of the collateral security given to the Mortgagee |
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If the property is a condominium, check with the condominium management company for _____. Since the new owner will be _____, condo fees are treated like ____. Arrears of condo fees have priority over the ____. |
arrears in condo fees liable for these arrears taxes mortgage debt |
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If the Mortgagor is a corporation, search the _____. |
Corporate Registry for the registered office |
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Quick and inexpensive alternative to foreclosure proceedings |
•If there are no subsequent encumbrances on title, it is possible to use a QUIT CLAIM and Transfer of Land |
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Quit Claim: In exchange, the Mortgagee _____. Where no _____ is available, the Mortgagee gives up _____. The process is accomplished by filing a ______. Therefore, the Mortgagee takes the ______. |
an agreement whereby the Mortgagor agrees to transfer his/her interest in the mortgaged property to the Mortgagee gives up any claim it may have under the mortgage for deficiency judgment deficiency judgment any right to name the Mortgagor in a legal action Transfer of Land WITHOUT a court order Mortgagor’s title exactly as it stands
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If there are subsequent encumbrancers on the title – _____ is NOT an option
•If there are subsequent encumbrances to the mortgage, HAVE to proceed by way of _____ |
Quit claim Statement of Claim and consent to a Final Order for Foreclosure |
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____ will have to be given to ______ for the ____ to give them the opportunity to _____. |
Notice all subsequent encumbrancers of the application Final Order for Foreclosure object if they wish
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