Court reverses own mortgage fraud decision
Published Wednesday, February 7, 2007 12:46PM EST
Ontario's highest court reversed its own decision, giving a Toronto woman her 100-year-old home back which had been stolen from here in a paper scam by identity thieves.
"I'm delighted I won, I'm ecstatic," Susan Lawrence, 55, said. "I think it's a great thing and I think common sense has prevailed."
Five Court of Appeal judges unanimously decided in favour of Lawrence. The court gave her back the ownership of her home and ordered Maple Trust -- the company which issued a $291, 924 mortgage to a fraudster - to pay $25,000 towards Lawrence's legal costs.
In a ruling written on behalf of the panel of judges, Justice Eileen Gillese summarized the case by saying, "Ownership of a person's home is fraudulently transferred, the property is then mortgaged."
"In a contest between the two innocent parties - the homeowner and the lender of mortgage money - who wins? This appeal answers that question in favour of the homeowner."
Lawrence realized there was a problem when she tried to sell her home.
The fraudulent mortgage had been registered in November 2005. She had decided to sell her property but when she applied for a new mortgage Lawrence was told that she did not own her home.
At first she thought it was a clerical error. But then it was revealed that someone else had registered a mortgage against the home.
Lawrence launched her legal battle after she received an eviction notice from Maple Trust a couple of months later. The widow had lived in the two-storey Victorian home for 28 years. She was never forced to leave.
She asked the Court of Appeal to reverse a previous decision it made in the "Household Realty" case of 2005. That case awarded rights to the mortgage company.
Public attention for Lawrence's fight and similar cases of mortgage fraud prompted the Ontario legislature to change the Land Titles Act to allow homeowners to get their homes back and declare the fraudulently obtained mortgage documents void.
Tuesday's decision came as a result of the legislative changes.
"The legislation guarantees that you never lose your title as a result of fraudulent documents," Government Services Minister Gerry Phillips said Wednesday.
"And that ... fraudulent documents registered against your title, that is somebody putting a mortgage against your title that you have nothing to do with ... would be taken off your title."
While Lawrence is set to receive money for her legal bills, she says it will still leave her out of pocket.
Maple Trust has 30 days to file an appeal of the court's decision.
Meanwhile, Lawrence's experience has opened new opportunities for the retail worker. She is now booking speaking engagements and is scheduled to give a presentation this summer for an FBI international securities conference. She will speak about mortgage fraud from the perspective of the victim.
With a report from CTV's MairiAnna Bachynsky and files from The Canadian Press