Court File and Parties

COURT FILE NO.: CV-24-00000364-0000 DATE: 2024-11-22

SUPERIOR COURT OF JUSTICE – ONTARIO

IN THE MATTER OF Section 12(3) of the Mortgages Act, R.S.O. 1990, c. M.40 AND IN THE MATTER OF a Charge/Mortgage dated December 18th, 2009, made by Frontiers Foundation Inc. in favour of Joseph Wayne Armstrong, deceased

RE: JUSTIN ARMSTRONG, AMBER ARMSTRONG and AURALEA MICHAUD, Applicants

HEARD: November 21, 2024 BEFORE: Fitzpatrick J. COUNSEL: M. Pascuzzo, for moving party, Applicants

Endorsement on Without Notice Application to Discharge a Mortgage

[1] On November 21, 2024 following oral submissions, I granted the relief requested by the applicants with brief written reasons to follow. Here are those reasons.

[2] This matter involves a demand mortgage that was registered against a Northwestern Ontario residential property located in Nolalu in 2009. Title for the property is registered in the District of Thunder Bay and bears PIN 62285-0179 (the “Property”) The mortgagee is a not-for-profit federal corporation, Frontiers Foundations Inc. (“FFI”). The mortgagor was a Joseph Armstrong who owned the Property. The principal amount was $54,000.00 and had an annual interest rate of 10%.

[3] Mr. Armstrong died in May 2013. The applicants are the sole beneficiaries of Mr. Armstrong’s estate. The applicant, Auralea Michaud is the Estate Trustee.

[4] An affidavit was filed on this matter by Mr. Armstrong’s son Justin. It enumerated the efforts made by the beneficiaries to locate evidence of the status of the mortgage. They could find nothing. FFI continues as a corporation and has a registered head office at 419 Coxwell Avenue in Toronto. A google map search indicates this address is occupied by a three storey multi residential building. The affiant could find no evidence of any demands for payments, payments having been made at or after Mr. Armstrong’s death or any indication of the status of the mortgage in documents among the personal effects of the deceased. I drew the inference that the Estate Trustee has made no payments in respect of the mortgage since Mr. Armstrong’s death.

[5] Correspondence to FFI at its registered corporate address has been unanswered. A website formerly operated by FFI has been taken over by another company which is using the corporate name but disavows any knowledge of the mortgage.

[6] The Property was transferred by the Estate Trustee to the applicant Amber Armstrong in June 2014.

[7] The applicants rely on section 12(3) of the Mortgages Act, R.S.O. 1990, c. M.40 which provides:

(3) When a mortgagor or any person entitled to pay off a mortgage desires to do so and the mortgagee, or one of several mortgagees, cannot be found or when a sole mortgagee or the last surviving mortgagee is dead and no probate of his or her will has been granted or letters of administration issued, or where from any other cause a proper discharge cannot be obtained, or cannot be obtained without undue delay, the court may permit payment into court of the amount due upon the mortgage and may make an order discharging the mortgage.

[8] Also, the applicants rely on a 2022 Superior Court decision of Di Luca J. in Sayward Investments Inc. v. DaSilva, 2022 ONSC 6215. At paragraph 37 Di Luca J. reiterated established law that the Mortgages Act is remedial legislation which should be liberally interpreted. An order under section 12 is discretionary and must consider the relative equities between the mortgagor and the mortgagee.

[9] The applicants also argue that section 4 of the Real Property Limitations Act, R.S.O. 1990 c. L 15 (the “RPLA”) bars any claim under the mortgage by FFI as more than after ten years have passed from the date of Mr. Armstrong’s death, a date at which FFI knew or ought to have known it had a claim to any amounts owing under the mortgage. Further as the mortgage contained standard charge terms 200033, these terms provide at paragraph 14 that upon the Chargor selling the mortgaged lands the principal sum and any interest owing becomes immediately due and payable without notice from the Chargee. Therefore, as the Property was transferred in June 2014, FFI’s right to claim anything under the mortgage has now expired.

[10] On the basis of the material filed and the submissions of counsel, including his representations that he could not locate any counsel acting for FFI, I find that FFI as mortgagee of the mortgage at issue in this application for the Property cannot be found. I find the applicants as beneficiaries and Estate Trustee have made diligent and complete efforts to ascertain the status of the mortgage as well as any claim FFI may continue to have in same. I find a discharge of the mortgage cannot be obtained without undue delay. I find that FFI’s claim in the mortgage is statute barred by operation of section 4 of the RPLA. I find no amount is presently owed by Joseph Armstrong, or his successor in title, to FFI in respect of the mortgage. Accordingly, as FFI has no further claim in the mortgage, I find that balancing the equities of mortgagor and mortgagee in this matter militates in favour of exercising my discretion in favour of granting an order discharging the mortgage without the necessity of any payments being made into court in respect of the mortgage as contemplated by section 12(3) of the Mortgages Act.

[11] Order to go discharging the mortgage and directing the Registrar of Land Titles at Thunder Bay to register a copy of the order on title to the property at issue in this application thereby discharging the mortgage.

“original signed by” The Hon. Mr. Justice F.B. Fitzpatrick DATE: November 22, 2024