Toronto-Dominion Bank v. Harold Young, et al.

(Quebec) (Civil) (By Leave)


Hypothecs - Remedies - Hypothec - Hypothecary remedy - Forced surrender and taking in payment - Liquid and exigible claim - Civil procedure - Time - Extinctive prescription - Failure to serve proceeding - In Quebec law, whether application for forced surrender for taking in payment, which is purely hypothecary remedy, is separate and independent remedy or remedy that can be exercised only if debt of original debtor exists and continues during proceeding - In alternative, whether court delay in hearing case and rendering judgment, having regard to judicial resources and other circumstances, can, in civil law, result in loss of clear and indisputable rights that party had when action instituted.


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In 2009, the appellant, the Toronto Dominion Bank, granted Linda Macht a loan that was secured by a first hypothec on her immovable. At the same time, Ms. Macht took out a loan from the respondents, Harold Young and Robert Young, to whom she granted a second hypothec on the same immovable. Ms. Macht defaulted on her payments, and the Youngs published a prior notice of the exercise of a remedy and instituted an action for taking in payment and forced surrender. In October 2011, a judgment declared them the owners of the immovable in question. On July 10, 2012, given that Ms. Macht was still defaulting on her payments, the Bank served only the Youngs with a new prior notice of the exercise of a remedy and published that notice. The Bank filed an application for forced surrender for taking in payment, but it did not sue or implead Ms. Macht.

The Superior Court allowed the Bank’s hypothecary action and declared it the owner of the immovable, which it ordered the Youngs to surrender. It found that the Bank had instituted its action in a timely manner and that its failure to serve Ms. Macht with the proceeding was not fatal. The Court of Appeal allowed the appeal, dismissed the Bank’s hypothecary action and ordered that the entries in the land register be cancelled. It found that, by the time the Superior Court judge rendered judgment, the secured claim against Ms. Macht had been extinguished by prescription, which meant that the hypothecary action had to be dismissed, since the hypothec was merely an accessory to the claim.