To benefit from the legal privileges resulting from this type of hypothec, it is mandatory to send a notice of registration of a legal hypothec. It is only after the notice is filed and registered that the legal hypothec becomes official.
2725. Such hypothecs take effect only from their registration in the appropriate register. Application for registration is made by filing a notice indicating the legislation granting the hypothec, the property of the debtor on which the creditor intends to enforce it, and stating the cause and the amount of the claim. The notice must be served on the debtor.
Source: Civil Code of Québec, CQLR c CCQ-1991, a. 2725
In the case of a legal hypothec resulting from a judgment, it is the party who suffers the monetary loss who must send the notice of registration and publish the legal hypothec. In this regard, it is the judgment creditor who has the obligation to register the legal hypothec in order to prevail himself of this privilege.
However, it is usually a legal expert as a member of the Barreau du Québec or the Chambre des notaires du Québec who is officially responsible for registering the legal hypothec. Under article 2991 of the Civil Code of Québec, the act must be certified by a legal professional:
2725. An act under private writing giving rise to the registration of a right in or the removal of a right from the Land Registry, or the reduction of an entry, must indicate the date and place it is drawn up and be accompanied by a certificate of a notary or attorney certifying that he has verified the identity, quality and capacity of the parties and the validity of the act as to form, and that the document represents the will expressed by the parties.
Source: Civil Code of Québec, CQLR c CCQ-1991, a. 2991
Moreover, all mortgage deeds produced by Hypotek are certified by lawyers who are members of the Barreau du Québec, ensuring that the provisions required by law are respected.
Unlike the vast majority of civil rights, such as personal or movable real rights, whose limitation period is usually prescribed by three (3) years,article 2924 of the Civil Code of Québec specifies that the right to a legal hypothec resulting from a judgment is prescribed by ten (10) years:
2924. The right resulting from a judgment is prescribed by 10 years if it is not exercised.
In some cases, this ten (10) year-period may be renewed, especially when there have been in the past unsuccessful attempts at execution.
To properly register a legal hypothec resulting from a judgment, a notice must be sent to the Land Registry. In this notice, the criteria described in the first provision of article 2981 of the Civil Code of Québec must be met:
2981. Applications for registration in the land register, in addition to identifying the holders and grantors of the rights to be registered, contain, in particular, the description of the property concerned and the mentions prescribed by law or by the regulations under this Book.
Applications for registration in the register of personal and movable real rights identify the holders and grantors of the rights, state the nature of the rights, describe the property concerned and mention any other fact that is relevant for registration purposes, as prescribed by law or by the regulations under this Book.
In addition to the general criteria of this section, the notice should also contain a description of the property charged with the hypothec and specify the amount of the obligation or the amount of the instalments. Furthermore, it is mandatory that the notice be served on the debtor. Article 2730 of the Civil Code of Québec provides a clear definition of these criteria:
2730. Every creditor in whose favour a judgment awarding a sum of money has been rendered by a court having jurisdiction in Québec may acquire a legal hypothec on the movable or immovable property of his debtor.
He may acquire it by registering a notice describing the property charged with the hypothec and specifying the amount of the obligation, and, in the case of an annuity or support, the amount of the instalments and, where applicable, the basis of indexation. The notice must be served on the debtor.
The notice must be filed with a copy of the judgment, unless the purpose of the notice is to acquire a legal hypothec on immovable property following a judgment rendered in a family matter. In that case, the notice must instead reproduce the pertinent extract from the operative part of the judgment and, as the case may be, the pertinent extract from the agreement or draft agreement to which the operative part refers. In addition, the accuracy of the content of the notice must be certified by a notary or an attorney. If the notice is notarial, the mere signature of the notary is sufficient certification.
Thus, the notice will be officially valid once the notice has been duly completed and sent to the Land Registry. The legal hypothec will also be made public to any interested party and take full legal effect.
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