The owner of a residential apartment complex defaulted on natural gas payments.
The City of Hamilton intervened under its Vital Services By-law, paid for the gas, registered a lien, and directed tenants to pay rent to the City pursuant to s. 221(1) of the Residential Tenancies Act.
The first mortgagee subsequently sold the property under power of sale to a bona fide purchaser for value.
The City claimed its statutory right to collect rents survived the sale.
The Court of Appeal held that the City's right to direct rent payments is a statutory collection device, not an interest in land, and does not survive the transfer of the property to a bona fide purchaser for value.
