Federation of Ontario Law Associations
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real estate law

READ FOLA's LATEST UPDATE FROM OUR REAL ESTATE COMMITTEE HERE


PROPOSED AMENDMENTS TO THE RULES OF PROFESSIONAL CONDUCT - "LENDING CLIENT"


On April 25, 2019 at the Law Society's Convocation, the Professional Regulation Committee tabled proposed amendments to the Rules of Professional Conduct regarding the definition of "Lending Client" in determining whether or not a lender is private or institutional.   Comments were due on June 30th.


SUMMARY OF FOLA's RESPONSE TO THE LSO's CALL FOR COMMENT RE: DEFINITION OF "LENDING CLIENT"  


The Law Society of Ontario (“Law Society”) is proposing to amend the definition of “lending client” exemption applies. the Rules of Professional Conduct. Rules 3.4-12 to 3.4-16 generally restrict lawyers from acting for both a both borrower and lender in the same transaction unless a specified exemption applies.


In preparing these submissions FOLA consulted with local associations and real estate committees, individual real estate practitioners, and organizations/corporations whose primary business is lending money to individuals and businesses.


It is FOLA’s position that the current draft definition is far too restrictive and will create situations where individuals and small businesses will be forced by the new Rule to incur delays and additional costs which are unnecessary. By significantly restricting the definition as proposed there are many sophisticated lenders who assist both small business and the general public who will be excluded. The end result will be for the borrowers to incur additional costs with no corresponding benefit. FOLA proposes that certain specified lenders be added to the definition and that consideration be given to designing a broader definition which will include lenders defined by size and lending expertise.


READ OUR FULL SUBMISSION HERE


Law Society's Professional Regulation Committee's Report

Ontario Bar Association submission to the LSO - March of 2018
 

IMPORTANT INFORMATION REGARDING THE ONTARIO GOVERNMENT:

  

Proposed reforms for Commissioners / Notaries 

FOLA met with Ministry of the Attorney General staff on March 20, 2019 regarding their proposed reforms to the Commissioners for taking Affidavits Act and Notaries Act (found here).


On April  15, 2019, FOLA submitted our response to the proposed reforms.  You can read our submission here.


Review of the Real Estate and Business Brokers Act, 2002

In January 2019, the Ontario government announced that they are undertaking a review of the Real Estate and Business Brokers Act, 2002, including the provisions relating to dual agencies and disclosure of competing bids. It released a consultation paper and requested written comments and also encouraged Ontarians to fill out an online survey


After consultation with Law Associations, FOLA submitted a formal response which you can view here.  Please note that FOLA only responded to the first five questions in the consultation paper as we felt that we did not have enough information on to adequately respond to the rest of the questions.


The Thunder Bay Law Association also made a submission which you can view here.


Coming Soon - Updated Ontario Standard Closing Documents 

The provincial Working Group on Lawyers and Real Estate recently reviewed the Ontario Standard Closing Documents and will be publishing updated versions on February 28, 2019.  The updated documents will be available on the Working Group website.  


SPECIAL CONSUMER-FOCUSED VIDEO SECTION!

Check out these 4 videos by LawPRO to share with your clients and/or on social media!

  1. What does your real estate lawyer do for you?
  2. What do Canadian homeowners know about title insurance?
  3. Why every homeowner needs title insurance
  4. Cottage Ownership: Know what you’re buying

  

Planning Act Proposed Amendments

FOLA has reviewed and endorsed proposed amendments to the Planning Act, which FOLA  is very excited about. We understand these proposed amendments will be introduced for first reading soon, are monitoring the situation, and will advise if the amendments are approved. You may even wish to contact your local MPP and confirm your support of these amendments.

  

Teraview® Issues 

The Working Group on Lawyers and Real Estate maintains a list of matters which are brought to its attention regarding Teraview and/or Land Registry Office procedures. The Working Group brings these matters to the Director of Titles, the government and/or Teranet and posts updates as it receives further information. The latest list of issues and update, dated February 29, 2019, is on the Working Group website.


OTHER UPDATES:


Condominium Document Sub-Committee

The LSO's Working Group on Lawyers and Real Estate established a sub-committee to consider the work undertaken in the purchase of a condominium and drafted standard documents to assist with the purchase of  a condominium. 


The draft condo documents are ready for final review and the sub-committee is looking for additional members to complete the final review. Details on the sub-committee and copies of the draft documents are available on the Working Group website. The sub-committee will meet via telephone/video conference and/or email, as necessary.   If you or someone from your association is interested in helping, please contact Merredith MacLennan at merredith.maclennan@stewart.com.  


Updated Mortgage Discharge Escalation List 

Last week, the Canadian Bankers Association (CBA) updated its list of escalation contacts for mortgage discharges. The updated list has been posted on the Law Society website


Law Society Consultation on Title Insurance  - 2018

In 2018, the Law Society’s Advertising and Fee Arrangements Issues Working Group examined 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.


Here is their: Consultation Document. See also the working group’s report to June 2018 Convocation.


FOLA's submission to the LSO's Advertising and Fee Arrangements Issues Working Group.


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. 


Letters of Support for this initiative from LawPRO and the Director of Titles for the Province were also received. 


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”[1]


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. 

    

[1] http://www.lawsocietygazette.ca/your-practice/new-rules-re-advertising-residential-real-estate-services-approved/ 

USEFUL LINKS

THE VALUE OF A REAL ESTATE LAWYER -VIDEO!

A REAL ESTATE LAWYER ENSURES PEACE OF MIND

Great to share on social media!


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)

*Notices from the Director of Titles can now be found on the Teraview® website under the “News and Info” tab.  Current Notices include: 

· Password Protection in Teraview 

· How to Check the Certification Status of Instruments on Teraview

· MGCSA Bulletin 2018-04 OnLand Application Release 

· Practice Management Tips from the Land Registry Office

We expect this to be a key source of up to date information for solicitors


AvoidAClaim:  AvoidAClaim is LawPRO’s blog that offers regular insights on claims prevention and practice management, and warnings about current frauds targeting lawyers


Bencher Blog: Bencher Blog is a resource for Ontario’s Lawyers from Jerry Udell, Law Society of Ontario Bencher


CCLA weekly 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


Sid Troister’s email updates:  If you aren’t already on his list, send Sid an email or subscribe on the website and ask to be added to his real estate update list. He periodically circulates useful and interesting information about real estate matters. 


Condominium Forms: Find prescribed forms under the Condominium Act, 1998


DHA Condo blog: An informative blog on condominium law published by Davidson Houle Allen LLP


Electronic Registration Procedures Guide:  Electronic Registration Procedures Guide published by the Ministry of Government and Consumer Services

 

OnLand: 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. 


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.


For more information on Historical Books, click here. 


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


Teraview Newsletters : News and information from Teraview


Teraview Search Tools  (select Search Tools)

  • City/Town cross reference list
  • Instrument prefixes 
  • Condo PINs 

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

COMMITTEE UPDATES

COMMITTEE UPDATE - JULY 2019

JULY REPORT

COMMITTEE PLENARY REPORT - MAY 2019

PLENARY REPORT

A REAL ESTATE LAWYER ENSURES PEACE OF MIND

There’s more than meets the eye when buying a home. Real estate lawyers have the skills and expertise to guide you through the home closing process.

What does your real estate lawyer do for you?

For most Canadians, buying a home is the largest investment they will ever make. A real estate lawyer is an expert who can help you with the following 8 key steps. 


Feel free to share this short video courtesy of LawPro.  To learn how, see this tip sheet.

What do Canadian homeowners know about title insurance?

LawPRO asked Canadians what they know about title insurance. The answers might surprise you. A real estate lawyer can help you find the title insurance that is right for you. 

Why every homeowner needs title insurance

Sometimes, there are problems with title to a property that aren’t obvious when you buy the house. Title insurance can help fix the problem or pay for a loss. A real estate lawyer can help you choose insurance that's right for you. 

Cottage Ownership: Know what you’re buying

There are few traditions more Canadian than weekends at the cottage. To ensure that your time at the cottage is filled with relaxation instead of drama, consult a lawyer before you buy to protect yourself from unexpected problems.