A city man who says the bank called in his mortgage when it found out the home was being used to grow medicinal marijuana has won an appeal to have the case reviewed as a human rights issue.
Robert McIlvenna had lost previous rulings in a case that began in 2010. The Canadian Human Rights Commission first dismissed the complaint in 2012, ruling that the bank's actions didn't constitute a discriminatory practice.
It all began when McIlvenna applied to Scotiabank in 2009 to increase his line of credit to pay for renovations to the home, which was occupied by his son, his wife and their three children.
In June 2010, after some of the work had been done, the bank sent an appraiser to the house. Once there, the appraiser learned that McIlvenna's son had a license to grow and consume medical marijuana.
“The applicant’s son had informed him that ... the second story addition to the house would be to accommodate the marijuana plants he and his wife require for medicinal purposes,” the court transcript says. “The appraiser reported that the house was stripped to its studs, the exterior facade was removed and the house was at a point which would be considered a shell only.
“The appraiser confirmed in this letter that, after completing his visit to the applicant’s property, he immediately called the bank branch to inform the bank of this information.”
In July of that year, the bank not only denied the line of credit extension, but informed McIlvenna he had violated the terms of the mortgage and the bank was demanding payment.
The following month, he filed a complaint with the human rights commission, alleging the bank was discriminating against his family because of their disabilities.
“In his complaint, the applicant explained that his son and daughter-in-law had each been prescribed marijuana and been licensed by Health Canada to possess and grow marijuana for treatment of their disabilities,” the transcript says. “The applicant complained that the bank’s actions and policies were discriminatory against people with disabilities who require the use and growing of marijuana.”
In March 2012, the commissioned ruled that the bank's “decision to call in the mortgage was not based on a prohibited ground of discrimination.”
The Federal Court of Appeal quashed that decision, and the case was referred back to the human rights commission again. In February 2016, the commission again rejected the appeal, finding that it appeared the bank's decision was based not on the presence of the grow-op, but on the fact the terms of the mortgage agreement were breached.
“The Investigator noted the bank’s position that certain obligations of the mortgage terms were breached, notably, to keep the property in good condition and to inform the bank of any planned improvements,” the transcript says. “The applicant’s breach of these terms entitled the bank to call in the mortgage and/or take possession of the property.
“The investigator also noted the bank’s view that, because the property value had been reduced to what the bank considered an unacceptable level as a result of the incomplete renovations, and because of its belief that the property was endangered, this allowed the bank to demand repayment of the mortgage.
“The evidence gathered does not indicate that the respondent called in the complainant’s mortgage based on his son’s disability and the particular form of treatment for that disability.”
In coming up with a decision, the judge wrote that previous court rulings determined a case should be reviewed if “obviously crucial information” was not property investigated.
On that, he wrote there were two instances: in the first, the investigator didn't find out whether the bank had a preexisting policy when it comes to granting mortgages to homeowners with a grow op.
Further, internal bank emails reference the grow-op as a problem, with one expressing credulity that the government would allow a grow-op of that size without a lot of controls and regulations in place.
“A reasonable person would agree that this evidence was crucial because it lends credence to the Applicant’s position that his son’s growing of medical marijuana may have been a factor in the bank’s decision to call in the mortgage,” the judge wrote.
And while the decreased value of the property was cited as a justification, the appraiser who discovered the grow-op didn't file a new estimate for the home's worth until after the mortgage had been called in.
The judge also cited other factors he says the investigator didn't properly examine that would have been crucial to McIlvenna's case. As a result, he ordered a judicial review of the decision by the commission, where more investigation could be done, if necessary.
He also awarded McIlvenna court costs.
