Can a secured party to a general security agreement require them to pay legal fees to preserve collateral?
British Columbia, Canada
The following excerpt is from Jacobs v. Laumaillet, 2010 BCSC 1229 (CanLII):
In Anderson v. Lucas, 2005 BCSC 846, Shaw J. held that the legal fees incurred by a secured party to preserve collateral could properly be charged to the loan based on the terms of the security agreement entered into between the parties. In that case, the general security agreement contained a provision that obliged the debtor to pay all costs “taken in connection with ... the enforcement of this Security Agreement.”
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