The applicant mortgagor defaulted on a mortgage and the respondent mortgagees commenced power of sale proceedings.
The mortgagor requested a discharge statement under s. 22 of the Mortgages Act, which the mortgagees refused to provide, claiming the mortgagor was stalling.
The mortgagees then sold the property to a third party.
The court held that the mortgagees had no reasonable excuse to refuse the discharge statement, meaning their enforcement rights were suspended under s. 22(3).
Consequently, the sale to the third party was invalid.
The court rejected the argument that ss. 35 and 36 of the Mortgages Act or s. 99(1.1) of the Land Titles Act protected the third party purchaser's title from a breach of s. 22.