Case is a lesson for homeowners who did not buy title insurance when they bought their house, writes lawyer Bob Aaron, to arrange existing owner title insurance through their lawyers.

A court decision released in January highlights the importance of homeowners having title insurance even if it wasn’t arranged at the time the house was purchased.

Nathramdas and Premwattie Chateramdas have owned their home on Fawcett Trail in Scarborough since July 2000. They did not get title insurance at the time they bought the house.

By 2022, the house had been mortgage-free for many years. Their daughter Melissa and her sister had lived there for the later part of their childhood.

In January 2024, Nathramdas and Premwattie were surprised to receive a tax bill for the property in the name of Melissa. They were even more surprised to discover that title to the property had been transferred to Melissa by a deed which had been forged and registered in November 2022.

It later turned out that the signature of the lawyer who appeared to provide independent legal advice to the parents on the title transfer was also forged and sent from a realistic but fake email address.

After title was transferred to her, Melissa applied to get a mortgage from RiverRock Mortgage Investment Corporation which promised a four-hour turnaround on mortgage applications. RiverRock provided a mortgage commitment the same day as the application.

On December 8, 2022, Melissa mortgaged the home to RiverRock and received the proceeds of $760,000, effectively appropriating much of the value of her parents’ home.

More than $500,000 of the money was used to discharge or pay down the mortgage on her home on Betony Drive in Richmond Hill.

Eventually, Melissa stopped making mortgage payments to RiverRock and the company issued a notice of sale under mortgage to start default proceedings.

Last year Nathramdas and Premwattie sued Melissa (in her married surname Sanasie), her husband Andrew Sanasie, RiverRock, the lawyer who registered the bogus title transfer, and Ontario’s Director of Titles to restore ownership to themselves and delete the registration of the mortgage.

The case was heard by justice Lisa Brownstone over two days in November and January.

In her January 27 ruling, the judge wrote: “Melissa meets the definition of fraudulent person (in the legislation). … Given that Melissa is a fraudulent person, the mortgage is a fraudulent instrument and void against the property and (her parents).”

The court ordered the Director of Titles for Ontario to delete the fraudulent deed and RiverRock mortgage from the title.

It also ordered Melissa to pay punitive damages of $150,000 and legal costs of $90,000 to her parents, but she has appealed that part of the court order.

Last week I spoke to Darren Frank, the lawyer who represented the parents in their successful claim. He told me his clients are awaiting restoration of their title. Without title insurance, they are hoping the Land Titles Assurance Fund will pay all their legal costs and damages.

“The court case would not have gone as far as it did if my clients had title insurance,” he told me.

The case is a lesson for homeowners who did not purchase title insurance when they bought their house to arrange existing owner title insurance through their lawyers.