Does a mortgagee have an obligation to release unadvanced funds from a trust account in the name of both the mortgagor and the mortgagee?

British Columbia, Canada


The following excerpt is from Cliffs Over Maple Bay (Re), 2010 BCSC 389 (CanLII):

A similar conclusion was reached in Weinberg v. Junior 8 Developments Ltd., [1980] O.J. No. 1419, 16 R.P.R. 21 (H.C.), where Hollingworth J. stated: 11 ...In this case there were monies in a trust account which could not be released unless conditions were met which were agreed upon between the parties. In this case also, the trust account was in the names of solicitors for both the mortgagor and mortgagees and following the Canadian Comstock principal I have no alternative but to state that the monies which were unadvanced did not belong to the mortgagor but belonged to the mortgagee.

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