I had the honour of once again chairing the now 15th annual Real Estate Law Summit. For those who did not see it, there will be replays. After 15 years of Summits, and many more years in practice, I have learned that there is still lots to learn. These were some of the things I either learned or learned again:
- There is a Land Titles Registration Guide on line which I found in the new Teraview under the “settings” icon (it looks like a little gear) under Web Services under Electronic Registration Guidelines. I had to see something about consolidating parcels and it actually helped. Who knew?
- Words matter. Simon Crawford clarified the importance of using certain words in indemnities and what the result is that might make you rethink using phrases such as “save harmless” and “not merge on closing” without a time limitation. He spoke specifically about the indemnity in common documents like assignment and assumption of leases and do we really appreciate what liabilities we are signing our clients up for with documents we think are just “standard”. He taught me the phrase “mots juste” (which I believe is French) for the “right words” and how important it is to use the right words instead of any or all words that we tend to throw into agreements.
- We talked about Beattie v. Wei, a recent decision and how again, saying “represent and warrant” in an agreement may result in a purchaser’s remedies exceeding the reasonable expectation of the vendor. Representations, innocently made, give rise to a right to terminate. “Warrant” gives rise to a claim in damages but the deal has to close. Once again, mots juste. Your vendor may not want to “represent” if it turns out not to be correct. In Beattie, a representation made “to the best of my knowledge and belief” only made what turned out to be a misrepresentation innocent. It did not eliminate the right of the purchaser to terminate.
- Audrey Loeb reminded me once again about the risks of buying a new condominium. And even worse, acting on a purchase of one. How to limit your obligations about advising about disclosure statement; new proposed amendments regarding disclosure, shared facilities agreements for facilities that do not exist; the right of a condominium to restrict smoking, pets, condominium control of unit renovations, etc. all are issues of concern.
- There is a whole new Construction Lien Act coming. Among other things, a lien claimant who has done work on common elements has to give notice to each unit owner of the claim for lien instead of just registering it and a unit owner can bond off the lien as it relates to his or her unit (probably unrealistically costly but it is there). The right of a lien claimant to claim against the owner for work done for a tenant is now clarified and for landlords made more onerous.
- Doing real estate deals in the north (like north of North Bay and south too) is a different animal since they have unorganized townships, surface and mining rights, title called “summer resort location” that has nothing to do with summer or resort, road boards, unusual crown patent reservations, and in some cases, very complicated thumbnail legal descriptions.
- The Financial Services Commission of Ontario (FSCO) is piggybacking on the Mortgage Brokers, Lenders and Administrators Act by imposing further requirements on lending on “non-qualified syndicated mortgages”. If you don’t think you act on syndicated mortgages, think again. Lenders or investors in loans can include family members and there will be almost a “means test” to ensure that the lender/investor is able to accept the risk of loss. It all goes into effect July, 2018 and hopefully, the Law Society will have some CLE on the topic soon.
- Jeffrey Lem, the Director of Titles is committed to publishing a host of Bulletins to help keep the system running smoothly. Watch for them.
- I knew all about 3 way DRA’s (document registration agreements to facilitate the registration of a private discharge at closing. I have even prepared 4 and 5 way DRA’s to deal with a sale and purchase, the registration of a private discharge, a separately represented lender and even a second mortgagee. But I do not understand why some lawyers don’t want to use them since it makes everyone’s life easier and protected and keeps costs down.
- My opinion that it is hard to be a residential landlord in Ontario was confirmed by Joe Hoffer’s discussion about changes to the Residential Tenancies Act, above guideline increases, evictions for renovations, etc.
And that is just scratching the surface. Our practice is a breeding ground for claims against lawyers simply arising from not keeping up to date on changes to the law and practice and the judicial decisions that affect us.
My disclaimer: The issues raised in this bulletin are for information purposes only. My comments should not be relied upon to replace specific legal advice. Readers should investigate all matters independently before acting on the basis of material contained herein. I reserve the right to be wrong and to change my mind. Use at your own risk.