Borrowers brought an application seeking a declaration that a lender’s $19,000 administrative fee charged under a mortgage commitment letter contravened the contract because only one draw of $150,000 had been advanced rather than the full $475,000 facility.
The applicants argued the fee should have been limited to 4% of the funds actually advanced.
The court held that the mortgage commitment letter unambiguously established a fixed administrative fee payable for the loan facility, not a percentage tied to individual advances.
Interpreting the contract according to its plain wording, the court rejected reliance on subjective understanding or subsequent documents.
The application was dismissed and the lender was awarded substantial indemnity costs.
