A lender registered a mortgage on a property in Calgary. Later, a builder who performed renovations registered a builder's lien caveat. If the property owner defaults and the property is sold, how would the priority of these claims generally be determined in Alberta?

Question: A lender registered a mortgage on a property in Calgary. Later, a builder who performed renovations registered a builder's lien caveat. If the property owner defaults and the property is sold, how would the priority of these claims generally be determined in Alberta?

Answer options: ✅ Priority is generally determined by the order of registration on the title, with earlier registrations taking precedence.

• Builder's liens always take priority over mortgages, regardless of registration date.
• The mortgage takes priority only if it was registered within 30 days of the builder's lien.
• Priority is determined by the size of the outstanding claim, with the larger claim paid first.

Correct answer: Priority is generally determined by the order of registration on the title, with earlier registrations taking precedence.

Explanation: Under the Land Titles Act (Alberta), and generally for financial encumbrances, the priority of interests is determined by the order in which they are registered on the title, often referred to as 'first in time, first in right,' unless specific legislation like the Builder's Lien Act or an agreement dictates otherwise.