Can a mortgagee add fees, charges and costs to the redemption amount of a mortgage?

British Columbia, Canada


The following excerpt is from Columbia Trust Co. v. Nelson, 1986 CanLII 963 (BC CA):

Those cases were referred to by Gansner L.J.S.C. in Ormiston v. Kapp, [1983] B.C.W.L.D. 217, S.C., Cranbrook No. 213/82, judgment dated 16th November 1982 (unreported). The claim by the mortgagee to enforce the covenant in the mortgage was rejected because, as the judge said at p. 3: I take it that under the aforementioned paragraphs any amount to be added to the principal sum and included in the redemption amount must have been ascertained at the time the order is sought and be accompanied by proof of payment Later, at pp. 4-5, he said: I conclude that para. 18 of the mortgage before me calls for proof of the actual amount of solicitors’ fees, charges and costs charged to the mortgagees up to the present time. Such fees, charges and costs must have been paid by the mortgagees to their solicitors, as would be the case where claims were made under either para. 3(f) or 13 of the mortgage. Whether or not such amounts have been demanded by the mortgagees, the mortgagors nevertheless are entitled to have received prior notice thereof. There is no evidence before me that any of these requirements have been met and accordingly the claim for the addition of solicitors’ fees, charges and costs to the principal sum and to be included in the redemption price or amount is dismissed.

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