Author: Jonnette Watson Hamilton Page 28 of 42

PDF version: The Effect of Non-compliance with the Dower Act – Yet Again 

Case considered: Webb (Re), 2011 ABQB 89

The context of this dower case is somewhat unusual. The Registrar in Bankruptcy had directed a trial to determine whether a caveat registered by a Mr. Karafiat, which claimed a secured interest in a homestead, was invalid because it did not comply with the Dower Act. The parties’ concession that non-compliance with the requirements of the Dower Act, RSA 2000, c D-15 did not render the disposition of the homestead void is also somewhat unusual. This is the first case that I am aware of in which the parties conceded that non-compliance rendered the transaction voidable, and not void. It is true there has been a trend in Alberta towards finding that the effect of a disposition of a homestead without the consent of a spouse is to render the disposition voidable, and not void. However, the matter is not free from doubt because the Supreme Court of Canada’s last word on the issue held such a disposition was void ab initio.

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PDF version: Specific Performance of Contracts for the Sale and Purchase of Land: Is Deeming Land to be Unique Enough to Return to Pre-Semelhago Days? 

Case commented on: Raymond v. Raymond Estate, 2011 SKCA 58

Fifteen years ago, before the Supreme Court of Canada decision in Semelhago v. Paramadevan, [1996] 2 S.C.R. 415, 1996 CanLII 209 (S.C.C.), it was taken for granted that land is inherently unique and therefore, as a matter of course, the equitable remedy of specific performance would be awarded for breaches of contracts for the sale of real property. However, in Semelhago, Justice Sopinka questioned those assumptions, stating in obiter dicta on behalf of the majority that specific performance should “not be granted as a matter of course absent evidence that the property is unique to the extent that its substitute would not be readily available” (at para. 22). Subsequent confusion in the case law about under what circumstances specific performance is available and the unforeseen consequences of the loss of automatic grants of specific performance in a Torrens land titles system attracted the attention of the Alberta Law Reform Institute (ALRI). Its October 2009 Final Report No. 97 on Contract for the Sale and Purchase of Land: Purchasers’ Remedies recommended (at paras. 8, 61) that “for the purpose of determining whether a purchaser under a contract for the sale of land is entitled to specific performance of the contract, the land that is the subject of the contract be conclusively deemed to be unique at all material times, and legislation should be enacted to that effect”. However, no such legislation has been tabled in the Alberta legislature in the past 18 months. Now, the May 2011 decision of the Saskatchewan Court of Appeal in Raymond v. Raymond Estate suggests that ALRI’s recommendation, even if enacted, may not be enough to return the law to its pre-Semelhago state. It does so by holding that Semelhago introduced a two part test for the granting of specific performance, with an objective component and a subjective one. It appears that the ALRI recommendation only addresses the objective component.

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PDF version: Perennial Problem of Section 8 of the Interest Act 

Case considered: Equitable Trust Co. v. Lougheed Block Inc., 2011 ABQB 193

This is one of several recent cases concerning the Lougheed Building at 604 – 1st Street SW in Calgary. The issue in this particular case was whether section 8 of the Interest Act, R.S.C. 1985, c. I-15, rendered mortgage terms providing for interest rate increases and administrative fees on default and in the final month of the mortgage unenforceable. Section 8 prohibits penalties for non-performance on loans secured by mortgages and is a statutory version of a long-standing equitable rule. This decision is of interest because the Master in Chambers, Judith Hanebury, adopts a limiting approach to section 8 which was rejected by the British Columbia Court of Appeal and because the mortgaged building, the Lougheed Building, is of historic interest. (The Lougheed Building has been designated a Historic Resource at both the municipal and provincial levels and was recently restored. Its heritage value lies in its representation of Calgary’s tremendous commercial growth prior to World War One; it is also an excellent example of the imposing Chicago Style of commercial architecture. For photos and details of the restoration, see the Canada’s Historic Places web site).

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