Jack enters into a lease with Mary for a term of one year.Before she leased the property,Mary granted a mortgage over the property to the Royal Bank of Canada.Mary does not advise the Royal Bank of Canada of the lease.A month later Mary defaults under the mortgage.Which of the following is true?

Question

Quizplus · Accepted Answer

The Royal Bank of Canada, as the mortgagee, has priority over the lease because the mortgage was granted before the lease. Upon default, the bank can enforce its rights, which may include evicting Jack to sell the property.

Jack Enters into a Lease with Mary for a Term