Toronto Commercial Real Estate Litigation Lawyers Obtaining Certificates of Pending Litigation (CPLs)

In commercial real estate disputes, a Certificate of Pending Litigation (CPL) can be one of the most powerful interim remedies available to litigants. When properly used, it can effectively “freeze” title to a property, preventing its sale, refinancing, or further encumbrance while a legal dispute is resolved. For businesses, developers, lenders, and investors, CPLs often become a central strategic consideration in disputes involving ownership interests in land or the enforcement of rights tied to real property.

As part of our commercial real estate litigation and asset recovery and enforcement practices, Milosevic & Associates provides strategic, results-focused representation in matters involving Certificates of Pending Litigation. We act for developers, lenders, investors, and businesses across Toronto and the Greater Toronto Area in both obtaining and challenging CPLs. Whether you are seeking to preserve a claimed interest in land or need to remove a CPL that is disrupting a transaction, our team delivers practical, commercially informed advice backed by extensive experience in Ontario real estate disputes.

What Is a Certificate of Pending Litigation?

A Certificate of Pending Litigation is a court-ordered instrument registered on title to land in Ontario. Once registered, it provides public notice that the property is subject to a legal dispute. This has significant practical consequences: most buyers, lenders, and title insurers will refuse to proceed with transactions involving a property encumbered by a CPL.

CPLs are governed by the Courts of Justice Act of Ontario, which allows a party to seek court approval to register a CPL where the litigation involves a claim to an interest in land.

In effect, a CPL functions as a form of litigation-based security. It preserves the status quo by ensuring that the property cannot be dealt with in a way that would undermine the claimant’s alleged rights before the dispute is adjudicated.

When Can a CPL Be Granted?

Ontario courts do not grant CPLs automatically. The moving party must satisfy specific legal criteria, and the court will carefully scrutinize whether the remedy is appropriate in the circumstances.

Core Requirement: A Claim to an Interest in Land

The threshold question is whether the underlying claim involves an interest in land, not merely a monetary claim.

Examples of claims that may support a CPL include:

• Disputes over ownership or beneficial ownership of property
• Claims for specific performance of an agreement of purchase and sale
• Constructive trust claims tied to real property
• Joint venture disputes involving real estate development
• Mortgage enforcement or priority disputes

By contrast, claims that are purely financial, such as breach of contract claims seeking damages, will generally not justify a CPL, even if they relate to a real estate transaction.

Strategic Uses of CPLs in Commercial Litigation

In practice, CPLs are not merely procedural tools, but strategic instruments that can significantly shape the course of litigation.

Preserving Real Property as an Asset

In asset recovery contexts, CPLs are frequently used to prevent the dissipation of valuable real estate assets. If a defendant attempts to sell or refinance a property to avoid judgment enforcement, a CPL can stop that process in its tracks.

Securing Leverage in Settlement Negotiations

Because a CPL can effectively immobilize a property, it often creates strong pressure on the registered owner to resolve the dispute. This leverage can be particularly important in high-value commercial disputes involving development projects or income-generating properties.

Protecting Equitable Interests

Where a party claims an equitable interest—such as a constructive trust or joint venture interest—a CPL can ensure that their claim is not defeated by a transfer of legal title to a third party.

Defending Against or Removing a CPL

For property owners, a CPL can be highly disruptive. As a result, defendants often move quickly to challenge or discharge it.

Grounds for Discharging a CPL

A CPL may be set aside where:

• The claim does not truly involve an interest in land
• The plaintiff has not demonstrated a triable issue
• The balance of convenience favours removal
• The CPL is being used for an improper purpose

Courts are alert to situations in which CPLs are used as tactical pressure rather than for legitimate protection of property rights.

Posting Security as an Alternative

In some cases, courts may discharge a CPL if the defendant provides alternative security, such as paying funds into court. This allows the litigation to proceed without tying up the property, while still protecting the plaintiff’s potential recovery.

CPLs and Commercial Real Estate Transactions

From a transactional perspective, the presence of a CPL on title is a significant red flag.

Impact on Purchasers and Lenders

• Purchasers will typically refuse to close a transaction involving a CPL, as it creates uncertainty regarding title.
• Lenders are unlikely to advance funds secured against a property subject to a CPL.
• Title insurers may decline coverage or impose significant exceptions.

As a result, even a temporary CPL can derail or delay commercial deals.

Urgency in Resolving CPL Issues

Given these consequences, disputes involving CPLs often proceed on an expedited basis. Motions to obtain, discharge, or vary CPLs are frequently brought early in the litigation process.

CPLs in the Context of Asset Recovery & Enforcement

CPLs play a critical role beyond traditional real estate disputes. In asset recovery and enforcement scenarios, they can be part of a broader strategy to locate, preserve, and ultimately realize value from a debtor’s assets.

Complementary Remedies

CPLs are often used alongside other enforcement tools, including:

• Mareva injunctions (freezing assets)
• Writs of seizure and sale
• Receivership orders
• Charging orders

Each remedy serves a different purpose, but together they can form a comprehensive enforcement strategy.

Tracing and Recovering Property

Where funds have been used to acquire real estate—particularly in cases involving fraud, breach of trust, or misappropriation—a CPL can help secure the property while the claimant seeks a constructive trust or tracing remedy.

Why CPLs Matter in Toronto Commercial Real Estate Litigation

In a market like Toronto, where commercial real estate values are high and transactions are often complex, the impact of a CPL can be particularly significant. Whether in disputes involving development projects, joint ventures, financing arrangements, or ownership claims, CPLs frequently become a central battleground.

For businesses operating in Ontario, understanding how CPLs work and how to use or challenge them effectively is essential to protecting property rights and managing litigation risk.

Dealing with a Certificate of Pending Litigation in Toronto? Call Milosevic & Associates for Experienced Guidance

Certificates of Pending Litigation are high-impact legal tools that require careful handling. Whether you are seeking to preserve an interest in land or need to remove a CPL that is affecting your property, experienced legal advice is critical.

The commercial real estate litigation lawyers at Milosevic & Associates regularly acts for developers, lenders, investors, and businesses in complex real estate disputes. We provide strategic advice on obtaining, defending, and discharging CPLs, as well as integrating them into broader asset recovery and enforcement strategies.

Serving clients across Toronto, the Greater Toronto Area, and Ontario, we provide strategic, results-driven representation in complex property disputes and enforcement matters. To discuss your commercial litigation issue and protect your interests, contact our firm online or call (416) 916-1387.