Executive Summary: Key Legal and Evidentiary Issues

• Compliance with court orders regarding mortgage payments and the consequences of non-compliance under Rule 60.12.

• Determination of whether actual notice of a beneficial interest or trust declaration affects a mortgagee’s right to possession and power of sale.

• Evaluation of the sufficiency and credibility of evidence supporting claims of beneficial ownership, trust, and equitable mortgage.

• Assessment of shifting and new arguments raised by the respondent and their relevance to the proceedings.

• Consideration of whether technical requirements for power of sale and notice were satisfied by the mortgagee.

• Analysis of whether alleged torts or equitable subordination claims can prevent a mortgagee from enforcing its rights in the absence of proven fraud or bad faith.

Background and facts of the case

Toronto-Dominion Bank (TD Bank) advanced $680,000 in mortgage funds to Sandra Andrade for the purchase of a condominium at 270 Scarlett Road, Unit 1201, Toronto. After default on the mortgage, TD Bank commenced power of sale proceedings and sought possession of the property. Ms. Andrade, the registered owner, supported TD’s application. However, Sasenarine Singh claimed to be the beneficial owner of the property pursuant to a trust declaration and raised multiple defences, including claims of equitable mortgage, equitable subordination, and tortious conduct by TD.

Mr. Singh alleged that he provided substantial funds to Ms. Andrade to assist with financing and that she held the property in trust for him. He also claimed to have participated in arranging the TD mortgage and asserted that TD had actual notice of his beneficial interest. Ms. Andrade denied these claims, alleging that Mr. Singh and his mother defrauded her, and provided evidence that the trust declarations and supporting documents were forgeries.

Throughout the proceedings, Mr. Singh failed to comply with multiple court orders requiring him to pay the mortgage and common expenses. Despite initially agreeing to keep the mortgage current, he ceased payments and did not provide evidence of inability to pay. He also raised new arguments and produced new evidence late in the process.

Discussion of policy terms and clauses at issue

The mortgage incorporated standard charge terms (No. 201814), granting TD broad rights to possession and sale upon default. Section 5.01 of the standard terms and sections 1, 20, 31, 32, 33, and 34 of the Mortgages Act were central to the court’s analysis. The court considered whether actual notice of a trust or beneficial interest would affect TD’s rights and whether technical compliance with notice requirements was achieved.

Analysis and outcome

The court found that Mr. Singh’s failure to comply with court orders regarding mortgage payments justified excluding his evidence on the mini trial and proceeding with TD’s application for possession. Even if Mr. Singh could establish beneficial ownership, he would be required to pay the mortgage, which he failed to do. The court found no credible evidence of fraud, bad faith, or exceptional circumstances that would prevent TD from enforcing its rights. The technical requirements for power of sale and notice were satisfied, and all occupants had received adequate notice.

The court also rejected Mr. Singh’s claims of equitable mortgage, equitable subordination, and knowing assistance to breach of trust, finding no triable issues or supporting evidence. The court emphasized that Mr. Singh’s claims against TD were contingent on unresolved claims against Ms. Andrade, and that he could not continue to reside in the property without paying the mortgage.

Ruling and overall outcome

The application by TD Bank was granted. TD Bank was awarded possession of 270 Scarlett Road, Unit 1201, Toronto, with a writ of possession stayed for 30 days to allow Mr. Singh to vacate due to health issues. The successful party is TD Bank. The total monetary amount ordered in favor of the successful party cannot be determined at this stage, as costs were reserved for further submissions and no damages were awarded.