Can a mortgagee preserve a lease on a mortgaged property?

Thus, a mortgagee’s interest in a lease on mortgaged property may be preserved in a final order for foreclosure. However, such an order alone will not necessarily make that lease enforceable against the lessee. For example, if the lessee refuses to pay rent to the mortgagee and, as a result, the relation of landlord and tenant is not established, the mortgagee’s sole remedy will be an action for possession: Towerson v. Jackson [1891] 2 Q.B. 484; Aikenhead v. Spivak [1931] 4 D.L.R. 174 (Man. C.A.). Therefore, in order for the mortgagee to enforce the lease, a landlord/tenant relation must be established through privity of contract or estate with the lessee prior to the foreclosure.