Is there a right of equitable set off against a liquidated claim under a mortgage?

Ontario, Canada


The following excerpt is from Daly Square Inc. v. 1786097 Ontario Inc. and Camille Mikhael, 2018 ONSC 6404 (CanLII):

The cases[2] the plaintiff relies on accept that a 1970 case, Arnold v. Bronstein[3], decided that there is no right of equitable set off against a liquidated claim under a mortgage which is to be paid “without deduction or abatement”, provided the mortgagee acts in good faith and without fraud. Arnold v. Bronstein is not, however, a case in which equitable set off was sought against a liquidated claim against a mortgage but rather a case in which an injunction was brought to stop a power of sale. There was also no reference in Arnold v. Bronstein to the phrase “without deduction or abatement”.

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