Fiducie Pret v. Canada Mortgage and Housing Corp., (1986) 5 F.T.R. 218 (TD)

• Judge: Dubé, J.
• Court: Federal Court (Canada)
• Case Date: November 20, 1985
• Jurisdiction: Canada (Federal)
• Citations: (1986), 5 F.T.R. 218 (TD)

Fiducie Pret v. CMHC (1986), 5 F.T.R. 218 (TD)

MLB headnote and full text

Fiducie Pret et Revenu (plaintiff) v. Her Majesty the Queen (defendant)

(T-2865-84)

Indexed As: Fiducie Pret v. Canada Mortgage and Housing Corp.

Federal Court of Canada

Trial Division

Dubé, J.

January 24, 1986.

Summary:

Fiducie made a mortgage loan which was insured by Canada Mortgage and Housing Corporation (C.M.H.C.). The loan was renewed by Fiducie at a higher interest rate. Later the borrower defaulted and C.M.H.C. paid Fiducie $1,866,295.00 under the insurance contract. Fiducie claimed an additional $227,286.00, being the difference between the original interest rate and the renewal rate.

The Federal Court of Canada, Trial Division, dismissed the claim by Fiducie because the renewal was not authorized by the National Housing Loan Regulations and was not made in accordance with the applicable provincial law.

Government Programs - Topic 2326

Housing - Mortgage loan insurance - Liability of insurer, for interest rate increase on renewal - Following a default a mortgagee lender claimed against Canada Mortgage and Housing Corporation for additional interest, being the difference between the original interest rate and the higher rate on renewal - The Federal Court of Canada, Trial Division, dismissed the lender's claim because the renewal was not authorized under the National Housing and Loan Regulations.

Statutes Noticed:

National Housing Act, R.S.C. 1970, c. N-10, sect. 8(1)(e) [para. 18].

Civil Code of Lower Canada, art. 2017 [para. 29]; art. 2018 [para. 30]; art. 2040, art. 2130(6) [para. 31]; art. 2468 [para. 15].

National Housing Loan Regulations, C.R.C. 1978, c. 1108, sect. 35(2)(b) [para. 22].

Counsel:

Raymond Lessard and Claude Ouellet, for the plaintiff;

J.C. Ruelland, Q.C., and Andre Bluteau, for the defendant.

Solicitors of Record:

Flynn, Rivard & Associes, Quebec, Quebec, for the plaintiff;

F. Iacobucci, Q.C., Deputy Attorney General of Canada, Ottawa, Ontario, for the defendant.

This case was heard by Dubé, J., of the Trial Division, of the Federal Court of Canada at Québec, Quebec, on November 20, 1985. The decision of Dubé, J., was delivered on January 24, 1986.