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Whelton Hiutin LLP Obtains Injunction Against Mortgagee and Former Real Estate Agent

Dan McConville recently obtained rare injunctive relief on behalf of a vulnerable mortgage borrower against her former real estate agent and his family mortgage company.

The applicant mortgagor was attempting to sell her property due to financial hardship. She retained the respondent real estate agent to list the property for sale, but eventually entered an agreement with the agent directly to sell the property to him. The real estate agent then arranged a bridge refinancing of the applicant’s existing mortgage through his family mortgage company, including a large lenders fee.

Following a dispute about the sale, the applicant refused to close. The agent and his brokerage then interfered with the applicants attempts to re-list and sell the property, and commenced power of sale proceedings.

Justice Myers provided directions for the discharge of the mortgage, and ordered an injunction preventing (a) the agent and related parties from further interfering with any sale, and (b) the mortgagee from enforcing its power of sale rights. Such injunctions against mortgagees are extremely rare and generally available only in cases of fraud or bad faith. Justice Myers found that the respondents’ actions “suggest a strategic approach to bully and intimidate the applicant, an ulterior purpose to scoop her equity over and above the mortgage debt, and support a finding of a real risk that absent injunctive relief, the applicant will suffer irreparable harm being rendered homeless with her children before she can get the case to trial.”

The applicant was also awarded $30,000.00 in costs of the proceeding, notwithstanding the standard language entitling the mortgagee to full indemnity costs of any enforcement action.

Justice Myers’ decision, Lamanna v. Kamra, is available here.