CareVest Capital Inc. v. CB Development 2000 Ltd.

CareVest Capital Inc. v. CB Development 2000 Ltd.

The presale purchasers are not entitled to specific performance because the subject property did not yet exist and enforcement would require ongoing supervision and modification of financing; the receiver was authorized to borrow $3,800,000 to rank after the MCAP mortgage but prior to all other charges, the receiver may not disclaim the presale contracts, the receiver was authorized to sell units at market value free of the developer's obligations but must hold in trust any excess of sale proceeds over the presale contract price pending determination of priority between purchasers and CareVest.

Citation
2007 BCSC 1146
Parties
Petitioner: CareVest Capital Inc.; Respondent: CB Development 2000 Ltd.; Respondent: Carrera Ventures Ltd.; Respondent: CB Development Ltd.; Respondent: 526018 B.C. Ltd.; Respondent: 330158 British Columbia Ltd.; Respondent: Craig Lochhead; Respondent: Grayden Roland Hayward; Respondent: Stanley Edward Greenfield; Respondent: Riverbend Mortgage Investment Corporation; Respondent: Traditional Garage Doors Inc.; Respondent: Port Coquitlam Building Supplies Ltd.; Respondent: Glen Chychrum; Respondent: Anne Chychrum; Respondent: Estate of Michael Chychrum; Respondent: Laura Kennelly-Mohr; Respondent: Brent Kennelly-Mohr; Respondent: Renee Cook; Respondent: Janet Cook; Respondent: Stephen Bulat; Respondent: Jaime Dy; Respondent: Bernardita Dy; Respondent: Sunita Chand; Respondent: Gangadharan Narayanan; Respondent: Uma M. Seetharaman; Respondent: Melanie Betz; Respondent: Peter Betz; Respondent: Donna E. MacDonald; Respondent: Bao Lam; Respondent: Thao Lam; Respondent: Colleen Leduc-Ledezma; Respondent: Cedigheh Ceyedsadr; Respondent: Ann Rodgers; Respondent: Johnny Bautista; Respondent: Rosario Bautista; Respondent: Mehrdad Ershad; Respondent: Vesaleh Verdiyeva; Respondent: Yeqing Qiu; Respondent: Superintendent of Real Estate; Respondent: Challenge Concrete Pumping Ltd.; Respondent: Rempel Bros. Concrete Ltd.; Respondent: TD & J Enterprises Ltd.; Respondent: Thornhill Electric Ltd.; Respondent: All Prospective Purchasers of the Strata Lots in Phase 3; Receiver/manager: The Bowra Group Inc. (Receiver/Manager)
Court
Supreme Court of British Columbia
Jurisdiction
Canada
Judgment Date
14 June 2007
Procedural Posture
Receivership Petition and Application Regarding Sale and Enforcement of Mortgages and Presale Contracts / Decision (oral Reasons for Judgment on Motion/applications)
Outcome
Application granted in part and dismissed in part; orders made as set out by the court.
Legal Topics
Specific Performance, Equitable Charge, Priority of Charges, Receiver Borrowing and Priorities, Presale Contracts, Sale Free and Clear of Encumbrances
Source Language
English
Property Law Insolvency Equity Real Estate Receivership Specific Performance Equitable Charge Priority of Charges +3 more

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Parties

CareVest Capital Inc.

Petitioner

CB Development 2000 Ltd.

Respondent

Carrera Ventures Ltd.

Respondent

CB Development Ltd.

Respondent

526018 B.C. Ltd.

Respondent

330158 British Columbia Ltd.

Respondent

Craig Lochhead

Respondent

Grayden Roland Hayward

Respondent

Stanley Edward Greenfield

Respondent

Riverbend Mortgage Investment Corporation

Respondent

Traditional Garage Doors Inc.

Respondent

Port Coquitlam Building Supplies Ltd.

Respondent

Glen Chychrum

Respondent

Anne Chychrum

Respondent

Estate of Michael Chychrum

Respondent

Laura Kennelly-Mohr

Respondent

Brent Kennelly-Mohr

Respondent

Renee Cook

Respondent

Janet Cook

Respondent

Stephen Bulat

Respondent

Jaime Dy

Respondent

Bernardita Dy

Respondent

Sunita Chand

Respondent

Gangadharan Narayanan

Respondent

Uma M. Seetharaman

Respondent

Melanie Betz

Respondent

Peter Betz

Respondent

Donna E. MacDonald

Respondent

Bao Lam

Respondent

Thao Lam

Respondent

Colleen Leduc-Ledezma

Respondent

Cedigheh Ceyedsadr

Respondent

Ann Rodgers

Respondent

Johnny Bautista

Respondent

Rosario Bautista

Respondent

Mehrdad Ershad

Respondent

Vesaleh Verdiyeva

Respondent

Yeqing Qiu

Respondent

Superintendent of Real Estate

Respondent

Challenge Concrete Pumping Ltd.

Respondent

Rempel Bros. Concrete Ltd.

Respondent

TD & J Enterprises Ltd.

Respondent

Thornhill Electric Ltd.

Respondent

All Prospective Purchasers of the Strata Lots in Phase 3

Respondent

The Bowra Group Inc. (Receiver/Manager)

Receiver/manager

Procedural Posture

Receivership Petition and Application Regarding Sale and Enforcement of Mortgages and Presale Contracts / Decision (oral Reasons for Judgment on Motion/applications)

Legal Issues

  1. 1 Whether presale purchasers are entitled to specific performance of presale contracts
  2. 2 Whether presale purchasers hold an unregistered equitable charge having priority over a registered mortgage held by CareVest
  3. 3 Whether the receiver may disclaim presale contracts

Ratio Decidendi

The presale purchasers are not entitled to specific performance because the subject property did not yet exist and enforcement would require ongoing supervision and modification of financing; the receiver was authorized to borrow $3,800,000 to rank after the MCAP mortgage but prior to all other charges, the receiver may not disclaim the presale contracts, the receiver was authorized to sell units at market value free of the developer's obligations but must hold in trust any excess of sale proceeds over the presale contract price pending determination of priority between purchasers and CareVest.

Court Disposition

Application granted in part and dismissed in part; orders made as set out by the court.

Orders

  • Application to add additional terms granted except insofar as inconsistent with the court's order.
  • Receiver authorized to borrow $3,800,000 on security of a mortgage ranking subsequent to the MCAP Financial Corporation mortgage but in priority to all other registered or unregistered charges.