The Plaintiff, Saugeen Economic Development Corporation, sought to enforce a second mortgage against the property of the Defendants, Karl and Karen Peuser.
The Defendants brought a cross-motion for summary judgment to discharge the mortgage, arguing the Plaintiff had surrendered its security interest during their respective bankruptcy proceedings by filing an amended proof of claim as an unsecured creditor.
The court found no express or implied surrender of the security interest, noting that the Plaintiff's actions were consistent with the security having no value at the time of bankruptcy and did not prejudice other creditors.
Consequently, the Plaintiff's motion for summary judgment was granted, and the Defendants' cross-motion was dismissed.
