Ontario Court Of Appeal Confirms The Priority Of Secured Construction Lenders' Subsequent Advances In Face Of Execution Creditors' Notice Of Writ

• Published date: 01 July 2020
• Law Firm: Miller Thomson LLP
• Author: Ms Jessica Penley and Kenneth R. Rosenstein

Some more good news for secured construction lenders. In a decision rendered April 9, 2020, the Ontario Court of Appeal has confirmed that the priority of subsequent advances by lenders holding a charge of real property will not be defeated by actual notice of an unsecured execution creditors' writ of seizure and sale of the property.

In 1842752 Ontario Inc. v. Fortress Wismer 3-2011 Ltd.; [2020 ONCA 250], the Court considered the appeal of an execution creditor that had filed a writ of seizure and sale with the sheriff for lands in which the debtor had an interest and that had already been charged in favour of construction lenders. The execution creditor was appealing the dismissal of its application for certain declarations relating to its writ of seizure and...