In a receivership over a commercial condominium development, the receiver sought approval of a marketing and sale process allowing the property to be sold free and clear of unregistered unit purchase agreements and leases.
A group of purchasers argued their agreements should be honoured and that the project should proceed to condominium registration so their units could close.
The court held that the first mortgagee’s registered security had legal priority over the purchasers’ and tenants’ interests, which were unregistered and expressly subordinated by contract.
The receiver was not required to borrow funds or complete construction to facilitate specific performance of the agreements.
Finding that the equities did not favour the purchasers, the court approved the marketing process and authorized termination and vesting out of the agreements and leases if required for a sale.
