law: The Law of Fiduciaries in Canada (Part 1)
- 08/08/13 03:20 AM
Fiduciary Duties and Obligations in Canada
By Brian Madigan LL.B., Broker
The case of Hodgkinson v. Simms (1994) in the Supreme Court of Canada is the landmark case on this subject.
The facts are relatively simple and straightforward. Hodgkinson was a very successful young stockbroker. He sought the advice of Simms a Chartered Accountant who had special expertise in tax planning and tax sheltered investments.
Simms recommended that Hodgkinson purchase four MURBS, which he did. The real estate market went sour and Hodgkinson … (0 comments)
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law: Informed Consent Form for SPIS (OREA 225)
- 02/17/13 11:59 PM
Ontario Real Estate Source
By Brian Madigan LL.B.
The real estate associations throughout North American were concerned about the issue of consumer protection. If the seller failed to disclose a defect or actively misled a buyer, real estate agents were worried about their own liability.
A documented disclosure statement became popular. It was thought that if the seller completed it, then, the agent would be “off the hook”. That didn’t turn out to be the case. Not only were both sellers and agents sued, sellers began to assert that they had received poor advice from their own agents … (0 comments)
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law: Informed Consent for Real Estate Professionals
- 02/10/13 07:56 AM
Ontario Real Estate Source
By Brian Madigan LL.B.
Gradually, the doctrine of “informed consent” is working its way into the real estate field.
First, it took hold in the field of medical malpractice and professional liability. Now, it finally seems that the real estate profession will not be exempt.
What does it mean?
Essentially, it calls for a full and complete explanation to be given by the professional to the client, sufficient that the client will truly understand and appreciate his options and then make his own “informed” decision.
What that doesn’t allow, is the brief, no information … (2 comments)
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law: Matrimonial Home Designations in Ontario
- 01/22/13 11:46 PM
Matrimonial Home Designations in Ontario
Ontario Real Estate Source
By Brian Madigan LL.B.
There is an opportunity under the Family Law Act to designate a home as a "matrimonial home".
You might think that married couples would wish to avail themselves of this opportunity. However, it's rarely used. In fact, no one bothers.
The reason is rather simple. If a property is not designated then third parties will presume that it is a matrimonial home. The consent of both parties will be required. The third party purchaser or mortgagee will not want to take a … (0 comments)
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law: The LAW of Disclosure in Canada
- 01/06/13 01:22 AM
Ontario Real Estate Source
By Brian Madigan LL.B.
If you want to know about the law of disclosure in real estate transactions, then have a look at this case:
December 8, 2011
BETWEEN:
Timothy Scherbak and Cherese Scherbak
Applicants
- and -
Zoriana Krawchuk, Re/Max Sudbury Inc. and Wendy Weddell
Respondents
Coram: McLachlin C.J. and Rothstein and Moldaver JJ.
JUDGMENT
The motions for extensions of time to serve and file Zoriana Krawchuk’s response and the applicants’ reply are granted. The application for leave to appeal from the judgment of the Court of Appeal for Ontario, Number … (0 comments)
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law: SPIS and the Entire Agreement Clause
- 01/03/13 10:26 AM
Ontario Real Estate Source
By Brian Madigan LL.B.
In 2007, the purchasers Adam and Olga Soboczynski bought a house in London, Ontario from Don and Louise Beauchamp. They had owned the house since 2001 and had not experienced any water coming into the basement.
They negotiated the sale of their house privately with the purchasers. The Soboczynskis did have the assistance of a real estate agent, who was their “friend” in this transaction but did not represent them.
The buyers submitted an Offer conditional upon inspection. They arranged for a home inspector to examine the property and then … (2 comments)
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law: What Does “Materiality” Mean in the Context of Real Estate?
- 12/29/12 02:37 AM
Ontario Real Estate Source
By Brian Madigan LL.B.
The issue of “materiality” in the context of a real estate transaction is always important. Under the Code of Ethics passed pursuant to the Real Estate and Business Brokers Act, 2002, a material fact is defined as follows:
“material fact” means, with respect to the acquisition or disposition of an interest in real estate, a fact that would affect a reasonable person’s decision to acquire or dispose of the interest”.
Further, a real estate agent must determine, investigate and verify material facts, and they must be disclosed to clients.
But, … (2 comments)
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law: Estate Issues with Joint Tenancy
- 12/28/12 03:26 AM
Ontario Real Estate Source
By Brian Madigan LL.B.
While there are some advantages to joint tenancy, there are also some problems. The primary advantage is the ease of administration of a deceased's estate. It is simple and uncomplicated, nothing more than the registration of a death certificate is required to effect the transfer.However, with joint tenancy there are two presumptions that need to be considered:1) the presumption of a resulting trust, and2) the presumption of advancement.Resulting TrustIf one party transfers property to another gratuitously, then the law will assume that the transfer was intended as a trust and not as … (3 comments)
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law: Documents for your Purchaser
- 12/09/12 03:50 AM
Consider a VIDEO
Documents for Your Purchaser
Ontario Real Estate Source
By Brian Madigan LL.B.
If you have just sold your house, what should you be leaving for the purchaser?Title DocumentsI am assuming that you have already delivered copies of these documents to your lawyer. However, in cleaning up, it's possible that you might have extra copies of the title deed, statutory declarations, survey, committee of adjustment application and so on.Building PlansAlthough not quite title documents, plans for the building drawn up by an architect, or even the copies of the model home from the builder … (6 comments)
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law: Identifying Individuals under FINTRAC
- 12/09/12 03:19 AM
Fintrac ~ Identification of Individuals
Ontario Real Estate Source
By Brian Madigan LL.B.
As a real estate agent you are under new legal obligations to collect and maintain certain records with regard to real estate transactions.These obligations arise under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act. This is federal legislation and has provided for the establishment of the Financial Transactions and Reports Analysis Centre of Canada, known commonly as "FINTRAC". It is noteworthy that breaches under this legislation may be subject to penalties under the Criminal Code of Canada.It is important to realize that the … (3 comments)
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law: Toronto Land Transfer Taxes
- 11/21/12 10:12 AM
Ontario Real Estate Source
By Brian Madigan LL.B.
You are probably aware that Toronto has its own Land Transfer Tax. This is in addition to the regular Provincial Land Transfer tax which applies throughout the Province.
This new Toronto Land Transfer Tax was passed by Council on 22 October 2007 and took effect on 1 February 2008. The present Mayor, Rob Ford ran on a platform which included the elimination of this tax. Although he was elected based in part upon his opposition to this unpopular tax, it has not been rescinded. It would also appear that Rob Ford has … (2 comments)
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law: Business Purchases ~ Should You Buy Assets or Shares?
- 11/04/12 11:20 PM
Ontario Real Estate Source
By Brian Madigan LL.B.
Assets, of course! That’s what just about everyone says. But, why is this?
Real estate agents are not generally trained in the field oof share acquisitions. Often, they don’t have experience, they don’t have educational courses and they don’t have any precedents. So, you can hardly expect them to put together a share purchase deal. Traditionally, the asset purchase is the least risky and safest course.
Lawyers and accountants are both trained in the field, but the deals flow through real estate agents and they are all going to be “asset” … (3 comments)
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law: Ontario’s Consumer Reporting Act ~ Consumer’s Rights
- 11/01/12 09:02 AM
Ontario Real Estate Source
By Brian Madigan LL.B.
The Consumer Reporting Act is designed to afford a certain level of protection to consumers. So, the Act defines consumers and does not apply to businesses.
There are requirements with respect to disclosure to consumers relating to credit information and personal information.
There are essentially three circumstances in which a consumer must be notified:
1) an extension of credit,
2) personal information, or
3) information used to the detriment of the consumer.
In other circumstances, disclosure is not required.
What is meant by personal information? First, credit information itself is simply factual information concerning an individual's payment history. Under … (0 comments)
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law: FINTRAC Obligations Upon Real Estate Agents in Ontario
- 09/30/12 11:27 AM
By Brian Madigan LL.B.Effective 23 June 2008, real estate agents must be aware that there is an obligation to comply with the provisions of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act. This Act is federal legislation and it is administered throughout the country by FINTRAC (the Financial Transactions and Reports Analysis Centre of Canada).So, who are they looking for? Actually, they are looking for both terrorists and money launderers. The method of enforcement is: not to allow them to hide among everyone else. The result is that everyone gives up a little bit of privacy in the … (0 comments)
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law: What is Allodial Title?
- 09/30/12 11:17 AM
By Brian Madigan LL.B. Just what is it and where does it come from? In English common law, the concept seems to have lost its meaning. Not too many people seem to know what it means, just legal scholars and historians have an interest in the subject.Today, there are really two different definitions of the term, and it depends upon whether you are discussing public or private property.In respect to public property, the concept has ancient origins actually predating the common law and the feudal system in the Middle Ages.Property which was occupied and held by force against others was held … (0 comments)
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law: Ignoring the Landlord is Foolhardy
- 09/30/12 11:06 AM
By Brian Madigan LL.B.From time to time, tenants will wish to take advantage of the favourable lease rates under a long term lease.For one reason or another, the property is no longer suitable for them to continue to occupy the premises. So, they decide to sublet. Only one little problem: they forget to notify the landlord. And, the reason is quite simple, the landlord would probably say "no".After a 15 year initial term, and a 5 year renewal, the landlord is anxious to see the lease come to an end so that he can raise the rates to market levels.At … (0 comments)
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law: Conditions and Related Escape Clauses
- 09/30/12 11:00 AM
By Brian Madigan LL.B.There is always a great deal of confusion and discussion concerning conditions and escape clauses contained in agreements relating to real estate. But, it is really rather straightforward and the documentation depends upon how the escape clause was written in the first place.There are really just two categories:1) pending deals (which require confirmation), and2) confirmed deals (which include an escape).Pending deals are generally described by a condition precedent clause, and confirmed deals with a provision for escape are evidenced by the condition subsequent clause. The condition precedent clause begins with the words "this agreement is conditional upon...." and … (0 comments)
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law: Misuse of Blank and Undated Documents
- 09/24/12 04:56 AM
Ontario Real Estate Source
By Brian Madigan LL.B.
The real estate agent in this case misused the documentation that has been drafted and made available by the Ontario Real Estate Association (OREA).
The agent rather than providing advice and assistance or representation as authorized under the Real Estate and Business Brokers Act, 2002 (the Act) decided to embark upon a new venture and a novel way of providing real estate services.
The agent used a website as a vehicle for providing services. In addition, in order to comply with the Act, he had his own Brokerage. This particular Brokerage facilitated … (6 comments)
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law: Can I Terminate for "Seller's Remorse"?
- 09/24/12 01:57 AM
Ontario Real Estate Source
By Brian Madigan LL.B.
Question:
We've accepted a registered offer on our home. We now have sellers’ remorse and would like to reject it before the home inspection. Can this be done? We have signed with a real estate firm.
Answer:
Your question is a little short on information.
However, let me make some further assumptions:
1) the property is listed through the MLS system,
2) you signed the standard form MLS agreement,
3) the offer was indeed accepted, so that you have a binding agreement,
4) the buyer’s deposit has … (3 comments)
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law: Vacant Possession: What does it mean?
- 08/29/12 12:46 PM
Ontario Real Estate Source
By Brian Madigan LL.B.
Even after you read this, you still may not know. With thousands of years of common law history, this is still a matter which is subject to judicial interpretation. There are still lots of unanswered questions.
The term vacant possession arises generally in two contexts:
1) occupation by a purchaser of property, and
2) occupation by a tenant of property.
In some cases, the tenant circumstance is a little more complex because the landlord may have to secure vacant possession from a prior … (2 comments)
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