Executive Summary: Key Legal and Evidentiary Issues

• Standing of a residential tenant to oppose an order absolute on a first mortgage was the determinative issue.
   
• Redemption rights, the court held, flow only from a contractual relationship with the mortgagee or an in rem interest in the property, and a tenant has neither.
   
• Allegations that the $20 million second mortgage was not bona fide, based on differences between the petition, the Feng affidavit and the later Wu affidavit, were found to be speculation.
   
• Windfall concerns were treated as only one factor, and the owner's failure to take any position weighed against finding a windfall.
   
• Timing of vacant possession required balancing the tenant's island access difficulties and long tenancy against his lengthy notice of the foreclosure proceedings.
   
• Costs were divided, with Scale B costs to the petitioner on its application, each party bearing its own costs on the tenant's application, and special costs refused.
   

Facts of the case

The property is a residence on Eagle Island in West Vancouver, which is accessible only by boat. It includes a house of approximately 6,000 square feet and a private beach. Gui Liang Wei is the registered owner. Rory Hinds has rented the property since November 1, 2016, and it is his permanent home. Over the years he liaised with a property manager and never directly with the registered owner. At times the owner's agent directed him to pay rent to various people and entities.

He has no formal tenancy agreement. According to Mr. Hinds, the owner's agent, a local real estate agent, agreed to a 2.5-year term running from November 1, 2024 to April 30, 2027 that renews automatically for another 2.5 years. The court had no evidence from the agent. His rent was paid through August 2026.

On October 7, 2024, the Bank of Montreal (BMO) began foreclosure proceedings on its first mortgage. An order nisi was granted on September 29, 2025, with the usual six-month redemption period ending March 29, 2026. At the date of the order nisi, $1,405,208.74 was owing on the BMO mortgage, at an interest rate of 7.2% per annum.

Xintiandi Enterprises Ltd. held a second mortgage with a principal amount of $20 million. Through its director, Chao Yuan Feng, Xintiandi had started its own foreclosure proceeding on March 31, 2023, but no order nisi was ever pronounced in that matter. On January 30, 2026, BMO assigned its foreclosure proceeding, its mortgage and all ancillary documents to Xintiandi. After the redemption period expired, Xintiandi obtained an order on April 16, 2026 substituting itself as petitioner. From then on it advanced the BMO proceeding rather than its own.

As of August 10, 2026, no money had been paid on either mortgage. Just over $1.4 million was outstanding on the BMO mortgage, and over $31 million was said to be outstanding on the Xintiandi mortgage. A May 9, 2025 appraisal obtained by the petitioner valued the property at $4.55 million. That figure exceeds the BMO debt but is less than 15% of the total owing on both mortgages.

Xintiandi applied for an order absolute and for Mr. Hinds to vacate within 14 days. The owner did not oppose. Mr. Hinds opposed and brought his own application to refer the petition to the trial list so the validity of the Xintiandi mortgage could be adjudicated.

Policy and legislative provisions at issue

Xintiandi's 2023 petition described a loan agreement dated September 18, 2020. Under it, Chengdu Longhai Enterprise Management Group Co., Ltd., Lu Yang, Zhong Qiang Yang and Gui Liang Wei, as borrowers, agreed to borrow $20,000,000 CDN from Chao Yuan Feng at 10% per annum, calculated monthly. The petition stated that the principal advanced was $20,000,000 CDN or Chinese Yuan 105,000,000, and that $25,631,191.45 was due as of February 23, 2023. Mr. Feng swore in a March 29, 2023 affidavit that these facts were true. The loan agreement attached to that affidavit, however, listed Ms. Wei as a guarantor rather than a borrower.

After Mr. Hinds filed a response on September 23, 2025 questioning whether any money had actually been advanced, Xintiandi filed an affidavit sworn September 29, 2025 by Daniel Wu, said to be Mr. Feng's personal assistant. That affidavit stated that the loan was not advanced in cash. Instead, Mr. Feng authorized the borrower to use the petitioner's property in China. Mr. Wu went on to say that when the Chinese loan went into default for non-payment, the Chengdu property was sold, the net proceeds were paid to the Chinese bank, and the foreclosure proceedings followed shortly after.

Several statutory provisions informed the analysis. Under section 94 of the Residential Tenancy Act, any order in the proceeding made without notice to Mr. Hinds would be potentially unenforceable against him. For that reason, and in keeping with usual foreclosure practice, he was added as a respondent to address his tenancy interests. The court also relied on the reasoning in Instafund Mortgage Management Corp. v Ranga, 2025 BCSC 1990, which refers to section 14 of the Law and Equity Act. Instafund also refers to paragraph 2(3) of the prescribed mortgage terms in Schedule B of the Land Title Act, which describes a mortgage as a release of the mortgagor's claims to the lands. The test for extending a redemption period, set out in 1103969 B.C. Ltd. v 1069185 B.C. Ltd., 2019 BCCA 73, requires a reasonable prospect of payment and sufficient security value for the amount outstanding.

Reasoning and analysis

Standing decided both applications. Following Instafund, the court held that although Mr. Hinds is a named respondent, his rights to the property arise only from his position as a tenant. Equitable redemption benefits flow only to parties with a right to redeem, based on the contractual relationship between mortgagee and mortgagor or an in rem interest in the property. A tenant is not party to an agreement with the mortgagee and has no in rem interest in a rented property, so Mr. Hinds had no standing to oppose the order absolute on the BMO mortgage. He also could not point to any decision in which a tenant had been allowed to challenge an order absolute, extend a redemption period or have a foreclosure referred to the trial list to dispute a mortgage's validity.

Mr. Hinds relied on comments in Instafund that exceptional circumstances such as fraud might permit a tenant to challenge an order nisi. Here, though, he was not challenging the order nisi on the BMO mortgage, and there was no evidence that mortgage was anything but legitimate. In the court's reading, the Instafund comments concerned possible fraud in the process of obtaining an order nisi. They did not create a broad right for tenants to attack agreements between mortgagors and mortgagees.

On the alleged windfall, the court treated it as only one factor in weighing the equities. Without any complaint from Ms. Wei, it was not reasonable to find a windfall on Mr. Hinds' speculative evidence. Petitioner-cited authority, including 1055249 B.C. Ltd. v Grace Mtn. Land Company, Ltd., holds that the value of all mortgages on title is relevant on an order absolute application. Accordingly, the court considered the Xintiandi mortgage even though the order absolute was being sought by the first mortgagee. Evidence of that mortgage's value was uncontradicted.

Mr. Hinds' allegations that Xintiandi misled the court and filed false evidence were described as serious. The evidence supporting them, however, amounted to nothing more than speculation. An arrangement involving property in China may be unusual by domestic standards, but the evidence did not support a finding that it was illegitimate. Even if Mr. Hinds had standing, the court would not have referred the matter to the trial list. Any challenge to the Xintiandi mortgage's validity could only come from the owner and mortgagor, and allowing tenants to bring such challenges would create potential for much mischief.

Evidence of Xintiandi's enforcement against other borrowers under the same $20 million loan agreement lent further support. In a number of those matters, the Xintiandi mortgage had also been registered against local properties, and in some, Xintiandi obtained orders paying out surplus funds from court. On an Acadia Road property, Xintiandi and Mr. Feng substituted themselves for BMO and obtained an order absolute on a first ranking mortgage, the same steps taken here. None of those proceedings appeared to have been opposed by the owners. That supported the loan being bona fide, at least in the sense that borrowers pledged properties as security and accepted that funds were due and owing.

The court acknowledged that risks remain if none of the underlying transactions are legitimate. It noted that safeguards exist outside the court process, such as client identification and verification obligations on counsel in mortgage transactions. Nothing in the evidence called for the court to investigate on its own initiative.

For vacant possession, neither party cited authority on how long a tenant should be given to leave after an order absolute. The court accepted that significant access issues exist, including parking, the community dock and the need to barge belongings off the island, and that moving would be logistically challenging. Against that, Mr. Hinds was served with the petition and affidavit seeking the order nisi on February 7, 2025, and had known for over a year that BMO was taking steps to foreclose. Rather than moving, he continued living at the property, paying rent and participating in the proceeding.

The only prejudice to the petitioner from a delay was continued interest on both mortgages. The court had no expert evidence on the point but saw no significant risk of a large drop in the property's value. Weighing these factors, it concluded that two months was the appropriate period for vacant possession.

Ruling and overall outcome

Xintiandi's application succeeded. The court granted the order absolute on the terms in Schedule "A" to its notice of application, effective 4:00 p.m. on September 1, 2026, and dismissed Mr. Hinds' application to refer the matter to the trial list. Mr. Hinds did secure considerably more time than the 14 days sought, with vacant possession due no later than October 27, 2026.

Special costs were refused. Although Mr. Hinds advanced a novel position on a tenant's standing, there was no misconduct in how he conducted the proceedings. Given his partial success on timing, Xintiandi was awarded Scale B costs payable by Mr. Hinds on its order absolute application only, and each party was ordered to bear its own costs on Mr. Hinds' application. No dollar figure was fixed for those costs, so the exact amount awarded cannot be determined from the decision.

Mr. Hinds also sought repayment of the $5,500 deposit he paid at the start of his tenancy. Because that payment went to the owner rather than the petitioner, the court declined to make an order without the owner's participation. It expressed hope that Mr. Hinds and the petitioner would resolve the issue and granted leave to return to court if needed.