Law Society Consultation on Title Insurance
The Law Society’s Advertising and Fee Arrangements Issues Working Group is examining practices involving the payment of fees and offering of benefits by title insurers to real estate lawyers or their staff and is considering whether additional regulatory measures involving these practices are required.
The Working Group wants to hear from real estate lawyers and other stakeholders with respect to a series of questions as outlined in the Consultation Document. See also the working group’s report to June 2018 Convocation.
FOLA's Response to the LSO's Advertising and Fee Arrangements Issues Working Group
FOLA has filed it's submission to the LSO's Advertising and Fee Arrangements Issues Working Group.
Our conclusion states:
"FOLA believes that the current Rules of Professional Conduct are sufficient to appropriately govern lawyers with respect to their dealings with title insurers.
The current Rules provide proper protection for the public and there is no evidence of any significant number of complaints or other issues relating to title insurance incentives.
FOLA was unable to locate any discipline decisions relating to lawyers’ arrangements with title insurers and FSCO notes in its 2015 Report that it continues to receive few complaints about title insurance, and those few complaints relate to claims for issues that were not covered by the title insurance policy or exclusions listed in the policy (on page 3).
Concerns regarding breaches of the existing Rules of Professional Conduct should be met with stricter enforcement, rather than additional regulation."
You can find our full submission here.
Deadline for Response: October 31, 2018
Your FOLA Executive will be providing a submission to the Law Society of Ontario on this important issue by the October 31st deadline. It would be very helpful to receive your input and the input of your local members who practice real estate.
If you would like to make a Submission now, here's the link: https://lawsociety.forms-db.com/view.php?id=87447
Provincial Standard Closing Documents
FOLA strongly believes that the real estate bar benefits greatly from working with a set of standardized closing documents for residential real estate transactions. At the May 2017 Plenary, a unanimous resolution was passed approving and endorsing the use of the standard closing documents prepared by the Working Group on Real Estate & Lawyers.
The resolution read as follows:
BE IT RESOLVED THAT:
The Federation of Ontario Law Associations approves and endorses for use in residential resale transactions in Ontario the following Standard Closing Documents as posted on www.lawyersworkinggroup.com:
a) Vendor’s Closing Certificate;
b) Purchaser’s Undertaking and Direction Re: Title;
c) Lawyer’s Undertaking;
d) Lawyer’s Direction Re: Funds; and
e) Lawyer’s Delayed Closing Escrow Agreement.
BE IT FURTHER RESOLVED that FOLA and each Local Law Association promote the use of the documents to solicitors in their Association and community.
BE IT FURTHER RESOLVED that the FOLA Real Estate Committee Chair liaise with OREA and the Working Group on Lawyers and Real Estate on an ongoing basis to amend the recommended documents if required.
The idea is to end the repetitions in the old forms and to eliminate any statements, warranties or declarations that were not required to be provided in the agreement of purchase and sale. Vendors, and their lawyers, should not be delivering anything that is not required under the agreement of purchase and sale, as doing so creates liabilities that are not required under the agreement. In addition, the use of standard closing documents can reduce the time a lawyer spends reviewing, revising and negotiating closing documents.
The following additional benefits are noted by the Working Group in the Rationale Document for the standard closing documents:
1. Less paper, no repetition and more efficiencies, as the content of the documents can easily be confirmed as being either unamended or modified;
2. Less time needed to negotiate the content of closing documents;
3. Adherence to province-wide standards;
4. Client’s rights and obligations are protected based on the agreement of purchase and sale;
5. Either party can easily prepare the documents for the other side; and
6. No need to delete inapplicable paragraphs as they are worded conditionally.
These documents are available in English and French on the Working Group website and are posted below.
Three Party Document Registration Agreement (DRA)
When electronic registration was first introduced in Ontario, an escrow closing procedure was developed to deal with the delivery of purchase funds, keys and off title documents in the form of a standard Document Registration Agreement (DRA) which is posted on the law society website.
The DRA has routinely been amended for use when there are three or more lawyers involved (when there is a private mortgage or when there is a separate lawyer representing the lender), and FOLA requested that the standard form of Three Party DRA be endorsed and published by the Law Society in the same way the DRA has been.
We are pleased to report that following a review by LawPRO and the other members of the Real Estate Liaison Group, the Law Society has approved a standard form of Three Party DRA and has posted it on its website. http://www.lsuc.on.ca/For-Lawyers/Manage-Your-Practice/Practice-Area/Real-Estate-Law/The-Document-Registration-Agreement-(The-DRA)/
New Law Society Advertising Rules for Residential Real Estate
On September 29, 2017, the Law Society amended the rules regarding residential real estate advertising to “support transparency and ensure consumers may easily compare prices”.
The new rules require all advertising of prices for residential real estate transactions to be all-inclusive, subject to certain allowable disbursements that can be in addition to the all-inclusive price. Other than these specified disbursements, if you advertise a price, you cannot charge anything more than the advertised price, regardless of what may have transpired during the course of the transaction.
These new rules do not apply to fee quotes given to a client on a particular transaction, so if a potential client calls you for a fee quote, the quote does not have to be all-inclusive.
The new rules apply to advertisements available to the public, which includes any mention of fees on your website. If your website has an “input your purchase price and we’ll calculate the fees and estimated disbursements” function – then this falls within the new advertising rules.
New rule 4.2-2.1 states:
A lawyer may advertise a price to act on a residential real estate transaction if:
a) the price is inclusive of all fees for legal services, disbursements, third party charges and other amounts except for the harmonized sales tax and the following permitted disbursements: land transfer tax, government document registration fees, fees charged by government, Teranet fees, the cost of a condominium status certificate, payment for letters from creditors’ lawyers regarding similar name executions and any title insurance premium;
b) the advertisement states that harmonized sales tax and the permitted disbursements mentioned in paragraph (a) of this Rule are not included in the price;
c) the lawyer strictly adheres to the price for every transaction; and
d) in the case of a purchase transaction, the price includes the price for acting on both the purchase and on one mortgage;
e) in the case of a sale transaction, the price includes the price of acting on the discharge of the first mortgage.
New commentary to the rule and to rule 3.6 (Reasonable Fees and
Disbursements) was also approved.
Further details can be found on the Law Society website.
Registration Records: OnLand.ca
A web-portal to provide remote access to search Ontario's Land Registration Records
Property Search: Teranet
Online Property Search and Registration
AvoidAClaim is LawPRO’s blog that offers regular insights on claims prevention and practice management, and warnings about current frauds targeting lawyers
Bencher Blog: https://bencherblog.ca/
Bencher Blog is a resource for Ontario’s Lawyers from Jerry Udell, Law Society of Ontario Bencher
CCLA weekly newsletter: https://www.ccla-abcc.ca/page/Newsletter
This weekly email newsletter regularly contains a “Did You Know” section from the CCLA Real Estate Lawyers Committee. You don’t need to be a CCLA member to subscribe to the newsletter
Find prescribed forms under the Condominium Act, 1998
DHA Condo blog: http://davidsoncondolaw.ca/blog/
An informative blog on condominium law published by Davidson Houle Allen LLP
Electronic Registration Procedures Guide: http://www.teraview.ca/wp-content/uploads/2018/02/ERPG-V12-2017-Final-English-AODA-.pdf
Electronic Registration Procedures Guide published by the Ministry of Government and Consumer Services
OnLand – https://www.onland.ca/ui/
Teranet, in partnership with ServiceOntario, has built this web portal to deliver key statutory services relating to land and property ownership in Ontario to land registry professionals and the public.
The first phase of the web portal offers customers the opportunity to test out the historical land registration book search and view option only. Customers will still be required to visit a land registry office to print any records.
For more information on Historical Books, see http://help.onland.ca/en/historical-books/
When fully implemented, OnLand will allow users to search historical and current property records, anywhere in the province, from the convenience of your home or office, instead of visiting a land registry office
Ontario Solicitor Network
This website was launched in 2015 to deal primarily with getting more solicitors elected as Benchers in the April 2015 Law Society elections and will be updated with information for the 2019 election when candidates have been declared
News and information from Teraview
Teraview Search Tools
http://www.teraview.ca/en/home/ (select Search Tools)
Working Group on Lawyers and Real Estate
The provincial Working Group on Lawyers and Real Estate has updated its website. Check it out for the latest version of the Ontario Standard Closing Documents, gain access to the OREA standard forms, and more
Working Group on Lawyers and Real Estate – Mentoring Imitative
The Working Group launched this initiative to mentor real estate lawyers on best practices. Because it does not have the resources to individually mentor, the concept is to create survey questions about various aspects of the work in a real estate transaction and then provide a comment in response to the survey results. It is hoped that this will generate discussion about the practice, encourage ideas to be shared and create an atmosphere to suggest best practices to better serve our clients and possibly create more efficient practice