Law Reform Commission of Saskatchewan Consultation Paper on Foreclosures

The Law Reform Commission of Saskatchewan has issued a consultation paper on Reform of The Land Contracts (Actions) Act:

"This consultation paper on The Land Contracts (Actions) Act (the LCAA) is the first part of a larger project to review and update the law of mortgages in Saskatchewan. The project was undertaken by request of the Minister of Justice and Attorney General pursuant to clause 6(c) of The Law Reform Commission Act."

"A mortgage is created when a person borrows money and gives an interest in real property as security. If the borrower (the mortgagor) fails to make the mortgage payments as required, the lender (the mortgagee) may start foreclosure proceedings to recover the money still owing under the mortgage. When a lender successfully completes foreclosure proceedings, the lender becomes the owner of the property. The lender may then sell the property to recoup the money it lent to the borrower."

"Foreclosure involves lengthy legal proceedings taken in the Court of Queen’s Bench and is governed by several statutes, including the LCAA. As the Court of Queen’s Bench for Saskatchewan noted recently, 'The Land Contracts (Actions) Act is consumer protection legislation intended to provide mortgagors with a degree of protection by requiring mortgagees to first seek leave of the court before they are permitted to commence foreclosure proceedings.' The LCAA is 70 year old legislation, having been enacted in 1943. This consultation paper considers the steps required by the LCAA for residential mortgages and whether they are still necessary or desirable."

The paper reviews the mortgage remedies available in other Canadian common law provinces; reviews the recommendations respecting mortgage remedies made by other Canadian law reform agencies; presents the need for reform of the Act; and offers possible approaches to reform the Act.