PROPERTY LAW – Professor Ramsay aka: “DPRQC”2007/08 – (Robert Kiesman)

CHAPTER 1: The Legal Concept of Land.

Common Law: Whoever owns the soil holds title all the way up to the heavens and down to the depths of the earth.

2 methods describing dimensions: (a) Description by a plan - sets out dimensions of the property; (b) A metes and bounds description: a starting point (not a plan).

Kelsen v. Imperial Tobacco Co: It is a trespass to interfere with the column of air above real property. It is trespass to erect an object which overhangs or intrudes into the immediately superincumbent airspace of another. Kelsen is the assignee (sub-lesee) of a lease...but is really a lesee. The owner consented to the sign being put up. Imperial, the defendant, put up the sign - a physical object in airspace - and have to get in their to maintain the sign. Cause of action: trespassing. P must prove D came on their land... and in a sense must prove the air is part of their land.The lesee doesn’t care about the sign, but wants another guy’s sign there who is willing to pay more. Underlying interest. Laches: a defense that people who get sued can rely on. If P unduly delays in enforcing their rights, D can argue the delay as a defense. There are time limits in commencing a lawsuit.

Bernstein v. Sky: An owner has a right in airspace above his land only to such height as is necessary for ordinary use and enjoyment of his land and the structures on it. The specific use of the property will dictate what height is necessary for the use and enjoyment of the land and structures. Skyviews flew over Bernstein’s land and photographed it.Bernstein claimed trespass. Argument was that he must have trespassed in order to take the photo. If he wanted to establish trespass, he had to establish that the D came onto his land. What is his land?

Manitoba v. Air Canada: An owner has a right in the airspace above his land only in the enjoyment of that land, and in preventing anyone else from acquiring a right in that airspace. The owner has no property right or legislative jurisdiction in relations to the airspace above his land.Manitoba tried to tax Air Canada on planes landed in, flew over province.Court said maxim could go no further “so as to limit a person to whatever proper use he can make of his land.”

STATUTES: AIR SPACE

Aeronautics ActUnder certain circumstances (specifically in vicinity of airports) the common law position on rights to airspace does not apply.Strata Property Act (formerly Condominium Act)

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Sets up statutory scheme under which a person may acquire fee simple ownership in a multi-unit building situation on land that (s)he doesn’t own. Under this scheme to accomadate that, a unit gets the benefit and burden of a series of rights (eg: access services and support). There is ability to subdivide the building. TWO types of stratas: (a) Bare Land Strata Plan: allows subdivision into strata lots on horizontal plane ( subdivision with special rules. (b) Building Strata Plan: Strata Lot: individually owns units. In addition to getting the unit, you also get proportionate share in the common property (and assets) as well. Common property (hall, elevator). Balconies are generally limited common property: it isn’t really yours in the same way your unit is - because they want rules of what you can do on your balconies (eg: no BBQ’s). Governance structure: bylaws govern how people get along. Strata corporation: corporate body that governs development. Strata council: board of directors. Unit entitlement: necessary to divide up expenses; deal with apportioned loss. = Your square footage divided by overall square footage. However, bigger units don’t get more votes - all only get 1.

Land Title Act: Airspace ParcelsYou can grant the right to an air space parcel over your land without it affecting your ownership of the rest of the air parcel.s. 136 states that; "Airspace constitutes land and lies in grant"; problem: statutory interpretation (ie. Land Title Act has no definition of "airspace"; turn to common law to determine meaning of airspace.An “airspace parcel” within a building - these can be underground.

Condominium Acts. 6(2) states that owner of a strata lot (plan) may deal w/ his individual space in the same manner as conventional land-owner, but he may not deal separately w/ jointly owned facilities.

AD INFEROS - below surface

Common law: gold and silver belonged to the Crown - all minerals and mines belong to land owner. 1858: you didn’t get gold or silver either in BC. 1897 onward you didn’t get base metals other than coal. 1899 Crown stopped giving coal and petroleum. 1951: Crown stopped giving out natural gas with original grant. You have to ask: when was original grant given? Government got nasty with grant owners that got minerals because their grants were given early enough (eg: Nanaimo Esquimalt Railway, p.10). Gov’t starting taxing the grant owner on base of minerals and if they didn’t pay tax the minerals reverted back to the government. Mineral Tenures Act (1996): you can get a free miners license that gives you right to go on private property and look for gold and silver and minerals that the Crown owns. If you find them you have certain rights to access them.

Accuracy: Land Title Act 23(h): “the mere fact that you have this plan and are a registered owner is no guarantee that it is accurate.” Have had it surveyed.Road allowances are 66 feet because the chains used by surveyors were/are that long. Also, every 666 feet, you have to set aside 66 feet for road allowance.

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Cadastral surveying: contrasting with topograpic surveying (features): (1) District (province divided into districts; (2) within District, various measurements are used: (a) Township was 6 miles by 6 miles = 36 square miles; (b) Section 1 mile by 1 mile (640 acres); (c) District Lots - vary in size - between 50 - 500 acres; (d) Block - various sizes; (e) Lots occur when the blocks are subdivided.

Parcel identifier: Each parcel of land has been assigned a parcel identifier (PID)#.

Winrub v. Street: An issue over the dimensions of the land and purchaser purchased land which was fenced. Purchaser’s lawyer did title search but did not order copy of plan. It turned out what was inside the fence did not all belong to the purchaser. Purchaser (P) sought to hold lawyer responsible - couldn’t hold Land Title responsible as they don’t guarantee correctness. Court concluded the lawyer did nothing wrong and followed practice that was generally acceptable.

What should a lawyer do? Order a copy of the plan, and have client initial the plan as part of the paperwork. Often the bank will ask for a survey---> they want to see any buildings on the plan---> to make sure your house is located within the four corners of the plan.

Horizontal boundaries: are fixed at a point in time by the plan.

FIXTURES

Common law: A transfer of an interest in land by a sale, gift, mortgage or lease, includes all the fixtures on the land - defined as “a chattel which is so fashioned or connected to the land that n law it forms part of the land.” Common law said transfer (sold, given, leased) of interest in land included all the fixtures on (eg: Blackacre). Somewhere between resting on the land and becoming attached it becomes land. Fixture = part of land.

Four situations it becomes an issue when something becomes a fixture: (a) What does one get when one buys property with a house? (b) What does tenant get at end of his tenancy? (c) Mortgage or other security interest that has been taken by a lender: What can they take here? (d) When someone dies: Who gets the appliances in the house and machinery in workshop?

Starting point: Has the chattel/item become a fixture? Has it been transformed? Ask: What is the objective/intention of the parties? --> What would an outsider looking at this was the intention?

FIRST STEP: What is the degree of annexation - to what extent is it attached to the land? You turn to two rebuttable presumptions: (a) If a chattel rests on its own weight presumed it stays a chattel; (b) If the chattel is attached even slightly it is presumed to be a fixture. You end up now with it either being a fixture or a chattel. ONUS now shifts to defendant to rebut it.

STEP TWO: Object of annexation: What is purpose of annexation? Would a reasonable personal familiar with customs of time and place conclude the parties: (a) intended item

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to remain chattel; (b) intended item to become part of real estate? Bathtub 200 years ago a chattel...now it is a fixture.

Haggert v. Brampton: Approach - looks first at degree of annexation - then second at object of annexation. This approach underlies most of the case law. Also considered permanence. As for object of annexation: “the question is whether the goods were affixed to building, though slightly, for the better use of the goods as goods, or for the better use of the building as a hotel building.” Answer: carpet meant to enhance the building.

Re Davis: If object is attached for the better enjoyment of the building as a building, it is a fixture. If it is for the better enjoyment of the chattel as a chattel, it is a chattel. A widow’s downer lays claim to real estate. Is bowling alley fixture or chattel?While the assumption based on the degree of annexation is that bowling alley would be a fixture, it fails on the second test - because the purpose of the annexation was for the better enjoyment of the chattel, not the building. Found that the bowling alleys weren't affixed for the better use of the building, but in order that bowling might be more efficiently carried on.

LaSalle Recreations v. Canadian Camdex Investment: Notice the discussion of the famous case Stack v. Eaton: Settled law: (1) Articles not otherwise attached to the land than by their own weight are not considered part of the land; (2) The slightest affixing enough to raise presumption they become fixture; (3) The degree of annexation; (4) The intention of the person who affixes the object is only material to the extent that you can determine from that the degree and object of the annexation - it is not what person says their intention was; (5) Where tenant affixed fixtures, a separate set of rules. **Important***

LaSalle Discussion: A chattel becomes a fixture when it is affixed to the land by more than its own weight and the purpose of the attachment is for the better use of the building as a building, and not for the better use of the chattels as chattels.Villa is owner of property. Camdex is financier and mortgage holder. LaSalle is supplier of chattel (carpet). LaSalle sold the carpet but financed it - it was not a cash sale. They took a Conditional Sales Agreement. Ownership of carpet remains with LaSalle until it is paid in full - BUT they do not have possession of it. It then appears to an outsider that the owner of property is owner of the carpet. A scheme developed: where LaSalle was to give notice to world that they were true owner: registering sales agreement in Land Title Office. LaSalle got into problem because NEGLECTED to register. If they had, there would not have been a case. LaSalle argued that it had never become part of the land. Decision: carpet was a fixture and LaSalle loses.

Royal Bank v. Maple Ridge Farmers Market: Chattels and fixtures can be distinguished as follows: (1) If object on its own weight and can be removed without damage or alterations to the fixtures or land that will need repair is a chattel - removal of door jamb or window is NOT damage; (2) Any item plugged in and can be removed without damage or alteration is a chattel; (3) Any item attached even minimally (it cannot be unplugged) is a fixture - screws, nails, bolts, detachment of plumbing are fixtures; (4) Item is a fixture if it loses its essential character because it is of no use unless attached to a permanent and substantial improvement to the premises of which it formed a part;

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(5) A tenant’s fixture may be removed from the premises during the currency of the tenancy; (6) In exceptional circumstances not covered, the court should have resort to the purpose test. Dispute between trustee in bankruptcy and mortgagee as to whether restaurant equip should be fixtures or chattels.Evaluate degree of annexation and object of annexation.

TENANT: When tenant takes object, cannot be material damage: (a) Trade fixture (shelving, hangings, mirrors - linked to tenant’s use of the structure; (b) Ornamental fixtures; (c) Articles of domestic convenience and utility - cupboards and stoves (residential); (d) Articles annexed for purpose of enjoying them as articles.It is tenant’s fixture if it is affixed by tenant and can be removed with no material damage.

Elitestone v. Morris: There are three possibilities: chattel, fixture improvement to real property (part and parcel of land itself), determined by examining the degree and object of annexation. The object of annexation can be inferred whether annexation was intended to be permanent or temporary.Dealing with situation with house being put on a premesis. Bungalow resting on concrete pillars for 50 years- is it a fixture or a chattel? Court’s categorization: Chattels, Fixtures, and part and parcel of the land.

Diamond Neon: A person not privy to a contract cannot be bound by that contract. The contract was not valid and therefore the sign became a fixture and passed with the sale of land.There was a pole with a sign on it. Pole set in concrete and held a business signn- sign supplied by a company (not owned by owner of the land). Agreement between supplier of sign and owner was the ownership remained with supplier: contract said “even if sign becomes fixture” it is still ours. Then someone bought the property without knowledge of contract. Became contest between purchaser and sign company. Purchaser could have argued: I am not privy to contract because I didn’t know about it. Contract between A and B does not define relationship between A and C. There is responsbility for seller to notify the purchaser. If purchaser loses out, there would be a claim towards the vendor. **They could have registered it (LaSalle) in order to avoid this problem.

(Case in Nanaimo in 1910: Two storey building rested on rocks and was held by Supreme Court to be a chattel - there was no degree of attachment.)

Mobile Homes have become more of a contention. Burlington Administration Company. Home set on concrete blocks - wheels removed - plywood skirting - wooden addition to mobile - hitch removed - connected to utilities. Court applied LaSalle and concluded that it was NOT a fixture. Plaza Equities: steel frame removed - concrete steps to front and rear - decided that it was a fixture.

***Possible exam question/theme: Floating House*** You have leased land...could it become a fixture...it is fastened down. You are a tenant (you argue tenant’s fixture...I can remove before end of lease). Other setups: they have strata-ed title...suspects that it would become a fixture.

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RIPARIAN RIGHTS

Common law: (a) Right to the bed of the water. Rights extend out to the middle of the water. (b) Rivers: As long as it was fresh water on non tidal it did not matter if it was navigable or not in England. In BC, if local circumstances make it inapplicable, won’t follow - If the river is navigable, riparian rights not extended.

Water Act: Flowing water is unregulated, percolating water is not (s.3). s.2 takes away riparian owners’ right to the use, flow, and quality of water flowing by his land - requires all users of water to get a permit to take water (unless it is considered unrecorded which is usable for domestic purposes).

Along comes Land Act... (Section 55; p.56). “No part of bed belongs to riparian owners.” Essentially they have TAKEN it away in 1961.

Salt Water Issues: Is the boundary at high tide or low tide? The boundary becomes the HIGH water mark. Choosing High Water mark based on: where there is a distinct line; change in vegetation. Different surveyors come up with different boundaries. Who owns seabed (foreshore)? The provincial Crown - result in dealings between feds and provinces. Not true everywhere in BC - reserves (feds own) - certain harbours (Victoria, Eqs, Burrard, New West) federal govt land.

There are 2 kinds of water: (a) Flowing - as in a stream or river. Common law: coming with ownership of riparian land a proprietory right to have water flow to him in its natural state in flow, quality, quantity - and entitled to make certain uses of it. Also, “whether he has made use of it or not.” Rights do not depend on prescription or grant you only get it because you own the land. However, the guy downstream is also entitled to non diminished stream contingent on the other guy’s domestic use. Owner can’t cause injury to other riparian owners unless injury results from dom use. Water Act: (a) The original right to use water vested in Crown; (b) Right to use water dependent on licence; (c) Unused licenses subject to cancellation; (d) Date of licences a priority; (e) Not an offence to divert unrecorded water to extinguish fire; (f) Not an offence to divert unrecorded water for domestic purpose or for prospecting mineral.

Land Act s.55: Riparian owner does not have right in bed or shore, unless it was specifically granted, except for the bodies of water outlined in colors other than red on Crown grant.These three cases related to NON-tidal waters...

Johnson v. Anderson: A riparian owner has a legal right to use of unrecorded water against an unauthorized user, if owner uses it for domestic purposes; unless invalidated by statute, all riparian rights remain in common law. Water Act does not overrule common law riparian rights (s.42(2).Anderson diverted stream from flowing through Johnson’s property where it was being used for domestic and stock watering purposes.Johnson had no water licence.Anderson has licence but it did not authorize diversion.Common law rights versus unlawful rights. Court finds the common law rights continue and have priority over unlawful uses.

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Schillinger v. Williamson Blacktop: Riparian rights, if any, can only exist for a person lawfully using water and the only way to acquire the right to the use and flow of water in any stream in BC is under the provisions of the Water Act. If water used contrary to licence granted, no enforceable rights exist.P operated hatchery in water diverted by licence. D logging, road building and gravel operations upstream.P alleges D added silt to water rendering it unusable.P felt entitled to undiminished and quality water under common law position.P was unsuccessful because it was an illegal use of the water. Riparian rights do not extend to water diversion; P's license did not grant him rights over the water, so he had no rights to divert the water.

(ii) b/c P had no right to the water which he was using, he could get no damages(iii) confirms that the changes made in the Water Act probably do take away

riparian rights with respect to diversion of flow of water.

Stedman v. Erickson: Person has right to the uninterfered use of unrecorded water so long as there is no other person with a licence to use the water.P is getting water from a dugout spring for domestic use. First thing you look for is source of water (perculating or flowing). If groundwater it is NOT within the Water Act and you fall on common law. CL says plaintiff gets it undiminished as to quantity and quality. If it weren’t groundwater, extracting for domestic use permitted, unless D has licence. D polluted the water by road construction. Lawsuit brought under the tort of nuisance: when someone engages in activity on their land which impacts negatively what you are doing on yours.

ACCRETION/EROSION LTA ss.94-96.Accretion describes the INCREASE which land bordering on a river,sea, or lake undergoes through the silting up of soil, sand or other substance for the permanent withdrawl or retreat of waters. In this case you GET THE LAND. But it has to occur through natural process or activites of someone on another property - it must be gradual (but maybe a natural storm?) - must not be responsibility of the owner.

Southern Centre v. South Australia: You can benefit from land gained by accretion through gradual and imperceptible natural forces, whether or not you own the land in fee simple or leasehold.Example where the new land went to the leaseholder - the riparian owner gets the accreted land. Even if you have been given land under accretion, it does NOT mean we are excluding the common law principles. Leasehold owner of lakefront property applied for accreted land. Appealed to Privy Council, leasehold owner granted accreted land.Note: Accretion not restricted to salt water bodes and happens not only by water retreating, but also other possibilities (air borne sand).

ACCESS BY RIPARIAN OWNERSMore of an issue with ocean: tides and foreshore. Can you go over land owned by the provincial Crown?Foreshore: land between low tide mark and average of neap and spring high tide marks.

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North Saanich v. Murray: Riparian owners have a private right to access and regress to and from water abutting their land but cannot put down anything which disturbs the foreshore and interferes with the foreshore owner’s rights. You cannot interfere with any public right of navigation. Murry owns land that fronts the sea - built a wharf - North Saanich claims this is trespass.Crown owns the foreshore and bed of the body of water, and may grant the foreshore and bed for private use (oyster farming).Right of ownership does not come from ownership of water, but from ownership of the land which abuts the water.

(b) Perculating water - well water.

SUPPORT

You may not have to turn to property law to solve these problems (can use torts or contracts). Often brought as alternate types of remedies (claim for trespass).

Lateral support: the support owed by adjoining land owners. Nobody can interfere with land by removing lateral support (not including support for additional structures).

Subjacent/vertical support: the support by a sub-surface owner to the surface owner. Limited to land in its natural state, though it can be extended to vertical support for a building, by applying rules of trespass rather than support doctrine.

General Statement: the owner of land is entitled to have the land left in its “natural plight” and condition without interference by the direct or indirect action of nature caused by the direct action of the owner of adjoining land (or sub-surface owner). It is an absolute right, it is not a right that arises from the law of torts. You do not have to show that adjacent land owner was negligent.

Limited to land in its natural state. If there is building there is no right of support for building. But, if there is a building, and it falls due to earth being removed beneath. The owner of the building could argue that the land would have fell even without a building having been there. (Trinidad Asphalt: Adjacent landowners - and there was pocket of pitch shared beneath them. One guy sucked pitch out of his own land. As he sucked it out, the other guy’s land fell in. There was no trespassing, but they were not mindful of the right of support. There was a claim and the plaintiff won damages.)

Cleland v. Berbarick: A landowner must not use his land in such a way as to remove the natural support of adjoining land and thus interfere with or prevent their neighbor from enjoying their own land in its natural state.P and D own side by side parcels of land on the lake. D had large amount of sand removed - as result of removal of land, more sand taken from property. Right of support just comes with the land - part of land. Selling the sand immaterial - although “uneighborly.” If there is a building there, you must show the land would have gone done independent of the building being on the site. Removal of sand: removal of support.

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Bremner v. Bleakley: A landowner is entitled to all the natural advantages of the land, but this does not include retaining title to sand which blows away. Sand is owned where it lies.Here A had dug a hole on property - wind blew sand from R’s property and it came to rest in the hole. P argues right to natural, lateral support of land. Doctrine that courts applied to blowing sand: relates to accretion: if sand forms by gradual accumulation - becomes property of the owner. Not escavation that produced movement - it merely prevented it from being blown back.

Gillies v. Bortoluzzi: Landowner is entitled to lateral support of the land but not the building.D excavated basement, Subsequently the adjacent wall of building standing on adjoining land collapsed, tenanted by plaintiff. P alleges D removed lateral and vertical support.Doctrine only applies where you show the land would have gone down without building. D did succeed - not on right of support - but on negligence. P engaged in activity on their property which caused harm to their neighbor. Collapse of the wall was caused by the negligence of D. Three Ways: You can have right of support claim - negligence claim - or trespass claim. Trespass is the easier claim to make - if they crossed the line, they are liable.

Rytter v. Schmitz: In addition to fact that landowner cannot remove both vertical and lateral support of his neighbor’s land, the right to lateral support is also under negligence and trespass.D excavates basement. Removal of soil cased subsistence by loss of lateral support of P’s building. Prescription: a doctrine that says if you’ve enjoyed a right for an extended period of time then you actually acquire that right - BC has abolished this prescription. This case introduces: suggestion that perhaps a building is entitled to support...maybe it is changing... “buildings may be entitled to vertical support.” In Capilano Bungalow: court talked about how there was tresspass and negligence - and began talking about support. However, this part was not central to issue of liability. This case needs to be taken with grain of salt.

Support SummaryZiff (104): the properties need not be immediately side-by-side.The doctrine as we have seen does not extend to right of support for buildings - don’t limit it to buildings - rather, “things.”Even though right of support is there, if you are in position as landowner to get easement of support (or contractual agreement) with an adjacent property owner that you will get support - do it! Advantage: you can be more specific/customize it to fit the circumstances - and include the requirement to support the building!

CHAPTER 2: General Principles of Land Law.

DIFFERENT TYPES/DIVISIONS OF PROPERTY

If you die intestate: first $65,000 goes to widow, and the remainder divided between child and widow. If you have more than one child...

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Equitable rights: gave rise to equitable interests in land. In BC today, if you own land, you are both the legal and equitable owner - but the law lets you seperate the two (one person can be legal owner and another is the equitable owner). Being the registered owner does not always mean person is the legal/real owner.

Themes to keep in mind: Essay question on exam asks to apply understanding of what we learned and comment on some theme of some kind. Ex: (a) There are differing interests developing over time in response to cultural and economic factors; (b) Aside from the interests there are also many rules relating to the transfer of those interests - how do you transfer the ownership? (c) How do you keep track of all those interests? Registration system; (d) To what extent is an interest freely alienable or transferable?

Allodial Ownership: Predates the feudal system. Literally it means “free” or owned without obligation of providing feudal services and loyalty and faithfulness to the lord. Those rights pre-exist what we call the title of the crown. AO is coming into play today in the form of Aboriginal rights.

Feudal System: Crown/King owning all of the land and parcels it out to his “friends” who get something less than full ownership. Different tiers of owners: Crown --> Lords--> Others. Tenure: the terms on which a tenant held the land (what were the incidents). “Free and Common Socage” is what we have in BC. Four main types of freehold:Knight service: tenant had to supply soliders and “succession duties”Sergeanty: different name for knight service and socageFrankelmoin: spiritual tenure to be givenSocage: tenant had to perform agricultural and “succession duties.” Now only socage remians and leaves two obligations: foreiture of land for treason; forfeit land if you had no heirs (escheat).

CORPOREAL INTERESTS (Right to possession):

Estate: has more to do with time. How does does the interest in land last? Tenure speaks to nature of interest, Estate refers to duration of interest. Types of estates: Fee Simple Interest: This is what people call ownership. There is no end to your ownership of it - it goes on after your death. There is no absolute owndership - fee simple is the best you can do. (Fee Tail): ownership continued as long as you had lineal descendants.Life Estate: ownership lasts for the length of the life of somebody.Estate Pur Autre Vie: life estate where length of time is measured by someone else’s life.Leasehold: landlord and tenant (lessor - lesee) - estate with a limited duration. Future Interests: estate where estate is promised to holder in the future (may be incorporeal).

It is possible for the land to revert back:Escheat: allowed the lord/Crown to regain the land once the tenure that was granted came to an end. Happens in BC: (a) where someone has fee simple interest with no relatives whatsoever and no will; (b) the owner of the land is a limited liability company (a creation of the law) - if the company ceases to exist (eg: never files) the Crown gets back the land.

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Forfeiture: came into play to end a tenure when there was a breach of the terms under which the land was granted. But under free and common socage (in BC) there are no duties that you must carry out. Expropriation: Fed/prov law allow them to take land back under certain circumstances - require compensation for the person(s) who lost interest.

INCORPOREAL INTERESTS (Right to use)Interests do not involve possession (mortgages - covenants - easements).

LEGAL/EQUITABLE INTERESTS

Legal Interests: come through common law courts, good against world.Equitable Interests: originally came through Chancellor’s Court, which gave equitable rulings, such interest are not as secure as legal interests.

Development of the Use: when holder of legal interest (at common law) was compelled by Court of Equity to hold the interest for the benefit of a 3rd party (feoffment or trust).

Statute of Uses: King tried to prevent uses a way of avoiding tax - used act to force beneficiary to assume legal title. It failed.

Trusts: (a) Legal title remains with trustee; (b) Interests that can be made in equity correspond to those in common law; (c) Trustee being legal owner can transfer ownership to third party; (d) beneficiary may deal his equitable interest just like any other interest in land; (e) true owner could always recover property.One person dealing with land on behalf of another. Consider: A transfers Blackacre to B for use of C. A would have to have confidence in B to carry this deal out as B is the recognized owner. How do you protect the interests of A and C? Court of chancery intercedes on behalf of C. They left that land out of it and dealt with the persons (eg: order B to live up to the trust - failure to do so meant jail). (Trust) Use allowed lands to become divisible on death. A could instruct B what was to happen to the land upon A’s death. 1549 Statute of Wills said you could pass your land after you die. FREEDOM OF ALIENATION

Main aim of English land law to ensure land is freely alienable (capable of being transferred). To achieve it, three requirements must be satisfied:

(1) Freedom of DispositionStatute of Wills (1540), Tenures Abolition Act (1660) allowedland to be willed.

(2) Restraints on AlienationAfter free alienation established, land owners tried to limit alienationimposing restraints:

Direct: insertion of direct restraint (held to be void by courts)Future Interests: long strings of future interests (including unborn heirs). Statute of Uses barred creation of many types of perpetuitites, which limited creation of future interests. (came up with joint tenancy). Strict Settlements: interest from father to eldest son. Not in effect in BC since Land (Settled Estate) Act.

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(3) Mechanics of Transfer (to be simple as possible)Establishing Good Title: lawyer examines deeds, mortgages, transfers, and will to see land has good clear title - subject to 60 year statute of limitations.Methods of Transfer (conveyance): (i) the livery of seisin, a public ceremony that puts person in possession; then later (ii) deed: a document as evidence of the livery of seisin; (iii) Statute of Frauds (now the Law and Equity Act) requirement that transfers must be in writing to be enforceable. If one party didn’t live up to it you couldn’t enforce it; (iv) registration of documents was required to convey right of possession.

Reception of English law: November 19, 1858: We got socage tenure and estates (fee simple, life estate, leasehold).We got the Statute of Frauds and some remnants of the Statute of Uses.We got the English trust concepts.We got a number of common law land principles: seisin (possession).We got an idea that subject to aboriginal interests, the Crown owned all the land - you can never get absolute (allodial) ownership - under certain circumstances escheat can come into play. Concepts of fixtures, support, delivery.

RELATIONSHIP BETWEEN REAL AND PERSONAL PROPERTY

Doctrine of Estates: Realty is based on doctrine of estates; Personalty operates on principles of absolute ownership, though courts have seen no reason to deny equitable interest in personalty, creating estates.

Fraser Case: The holder of a life estate owes a fiduciary duty to preserve the estate for the ultimate recipient.Testator gives life interest in his property to his wife, and then upon her death everything goes to charity. Issue: If she had right to encroach on personalty.Question was, “what does it mean to have a life estate?” **He could have put it in the will explicitly!

CHAPTER 4: Acquisitions of Interests in Land.

When it comes to acquiring interests in land, the second category of persons who can acquire interests in land are infants (<19). There is no restriction, despite the fact that infants cannot contract. However, the child cannot sell the land.

In BC, the person need not be a resident or a citizen.

When we talk about persons, we also mean corporate entities. A society (non-profit) is another incorporated entity (also credit unions, and co-operatives etc).

Another category: trustees, executives, administrators, attorneys. The commonality here is that all of these own the interest as the representative of somebody else. Trustee is there as representative of beneficiaries. Executor represents the dead guy. There are all kinds of different possibilities when we say a “person.”

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Four ways in which a person may acquire interest in land:

(1) CROWN GRANTS

90% of land in BC owned by Crown. Some lands not owned by the Crown:Ones owned by fed Crown (harbor, defense, reserves - railway lands);Private owners. Ones subject to aboriginal title claims - note: the natives have agreed to only focus on Crown land - sometimes the government pulls in private land and provides financial compensation.

Land ActPart 2 sets out rules for persons who wish to apply for Crown grant. Some restrictions: must be over 19 - have to be Canadian citizen or resident. Some important interests need cabinet approval (land below natural boundary of water/disposing of foreshore interests) and (land suitable for timber, mining, pulpwood or the extraction of minerals... resource lands). Otherwise, grants can be carried out in bureaucratic system. Crown usually gives leases, licenses of occupation, and right of ways and easements. These are interests less than fee simple. However, it is possible to get the land in fee simple. In order to promote tourist businesses they give licenses of occupation - not exclusive use. Even when you get fee simple: (a) Gov’t has right to come on and build roads, bridges, canals, public works not exceeding 1/20 of land; (b) gov’t can enter land and get minerals and geo resources; (c) Gov’t can take and occupy water....etc.

(2) INTER VIVOS TRANSFER

The transfer in the interest in the property takes place during lifetime of the grantor. Two subcategories: gift and contract. Testamentary transfers result from someone’s death (will, intestancy legislation).

Early in common law, transfer of possession was equivalent to transfer of ownership. Some concepts that came about and emphasis on possession have lingered through to today. Early on, documents setting out details of transaction are being done. But it is some time before the document actually transfers ownership.

Statute of Frauds - Law and Equity Act: you can only transfer land in writing.

POSSESSION: (a) Mental element - intention to possess; (b) Physical control.

Adverse Possession: abolished as concept in relation to land in BC. In BC we have land registration system that records interest in land. Land Title Act s.23.2: if you get to be registered owner of land you have good title against whole world BUT 23.3 adverse possession is not something that can be raised against registered owner. Adverse possession: the true owner of land has a right to sue to protect their possessory rights (trespass). Starting point: I have right to bring lawsuit for trespass, but something can take away that right: limitation period - various kinds of actions (tort, contract, statute). A person who takes adverse possession (who takes possession from you) gets ownership if you don’t start your action within a required period of time - you lose your possessory rights - they actually become the owner.

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Alberta, the period of time to bring action in trespass (to get rid of someone in possession of your land) is 10 years. Person has to meet certain tests: (a) squatter has to have intention to possess it; (b) have to be in physical control - open, peaceful, continuous, exclusive; (c) owner has to be aware of situtuation before limitation period begins.

In BC: s.23.3 abolishes the concept, BUT in 23.4 in case only of the first indefeasible title register, adverse possession still applies. Assumes nobody has yet become the registered owner. (Canadian Pacific Railway Co). s. 171 court can investigate and make declaration where claim is based on AP.

The Law of FindingPersonal Property: finder acquires title/ownership of that personal property that is good against the whole world except for the true owner. Possession equates to ownership (except against true owner). If you come across million dollars in bag - eventually someone claims it is theirs - in lawsuit true owner would not identify himself - court said he could not displace ownership of money. Aboriginals have tried to claim true ownership of certain artifacts.

Possession is basis for recognition and preservation of aboriginal title in common law. sui generis “in a class of its own.” One of the features the courts have picked up on is occupation - which is similar to possession (Delgamuuk v. BC).

Usufructory: a right of use - something less than possession - but as time passes, courts says what AB have is more - they have right of possession. Types of Transfers

CONTRACTS

Transferring both legal and equitable interest. You can seperate them, but we are now discussing acquiring both interests.

In BC, purchase/sale of land takes place in two steps: STEP 1: Vendor and purchaser negotiate a contract. Must be in writing (or enough writing) to satisfy requirement of Statue of Frauds/Law and Equity Act (s.59(3)). Note 59(1) says it can be oral trust, however. Often, realtors are involved at this stage (page 4-50). This MLS contract here not the current version - it is basically a standard form contract. Note: deposit is consideration for this contract - not the actual property transfer document. Note: subject of “inspection” not certainty necessarily. Note: “Free and clear except...exceptions and reservations” - mineral rights and royalties. Three dates: COMPLETION: the date on which the documentation is filed in Land Title Office. Completion is transfer of ownership. POSSESSION: when does the vendor give up possession of the property to the purchaser (not always on completion date). ADJUSTMENTS: the date on which you adjust for various matters (property taxes, utilities). Leads into risk: insurance: Vendor has legal/equitable interest, signs contract and parts with equitable interest and retains legal...when it completes purchaser has equitable interest and later acquires legal. RISK: When step (a) is signed, the effect of that agreement in law is that the equitable interest in the land passes to the purchaser. This clause, by contract, modifies what would otherwise be the risk to the purchaser - shifts it back to the vendor. For risk of loss purposes, there is no change - seller must keep insurance in place until completion. Note the 12:01 time - but the transfer often does take place until later in the day, so the

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purchaser should get insurance a day earlier. INCLUDED ITEMS: what is fixture and what is not “as viewed by Buyer at date of inspection.” Breach of Warranty: fixture not is same shape - not such a big deal - compensation can fix it. Breach of Condition: something more serious - allows innocent party to get out. PARA 10: Back to contract law: if vendor counter-offers it is purchaser that gets to accept - be careful - if they accept you are bound. At the end of this step the vendor has legal interest and becomes in equity a trustee for purchaser who has equitable interest. By the time the contract is signed both have rights. Vendor is sitll legal owner but has right to purchase money, a lien on property for unpaid money, and right of posession until closing. Purchaser has obligation to pay money and if vendor defaults, purchaser could sue for breach of contract and specific performance.

STEP 2: Form A: Driven by Land Title System in BC - we have a prescribed form in order to carry out this step. LTA 185(1): Transfer of freehold estate must be in the form approved by the director and on a single page. [EXAM*]. Freehold - free and common socage estate. An estate deals with length of time. You can have either “life estate” or “to X for the life of Y.” There is also the fee simple: duration is indefinite (unless escheat happens). “Must be in prescribed form”: Form A (page 4-55). There are three forms (A, B, C). A transfers freehold estate; B deals with mortgages, C everything else. Form A: APPLICATION: if you are lawyer, your info goes here. PARCEL IDENTIFIER: PID # and legal description. “Market Value” used to calculate land title fees. Form taken to BC Assessment Authority - becomes part of date in setting assessments. CONSIDERATION: price you are paying. TRANSFEROR: Vendor - do a land title search. If there is a spelling error, you have to repeat it! If they’ve changed their name: you can file document so LT office updates it. FREEHOLD ESTATE TRANSFER: Two choices are fee simple or life estate. s.186(5) if you say nothing, the default will be fee simple. TRANSFEREE: purchaser. EXECUTIONS: sign it. “Officer signatures” - the witness(es) - only lawyers, notaries, and commissioners for oath are officers. Act s.43: “the signature of the officer witnessing the execution is certifcation by the officer that individual appeared before and acknowledged to officer that he is person named...sig witnessed is sig of indiv who made acknowledgement.” Must personally appear and acknlowledge they are that person. Can be lawyer out of town but must be face to face. Note: transferee does not sign this form! s.44 deals with situation where vendor is not an individual, but a corporation: person signing must be authorized signatory of corporation. s.45 addresses where person signing as transferor is not transferor personally, but someone who holds power of attorney. Person acknowledges his is one named as POT, and he has no knowledge of death of person, or that he has gone bankrupt - POT ceases immediately! s.47: where person not fluent in English - must be somebody there to translate. s.186(2): If you have Form A signed, by law it is deemed to be made under part 1 of Land Transfer Form Act (p 4-12): if Form A is made in accordance with schedule 1, then it is made in same effect as if it had same words in other schedules. You are getting condensed version of a very lengthy document. Also includes words contained in column 1 and 2 of Schedule 2. Example: in column 1, phrase “free from all encumberances” - not in Form A. Note: you can modify these terms. What is result? (a) In BC you must use Form A, and using it brings in extended number of clauses. (b) Using Form A brings in s.3 of Land Transfer Form Act: “every Form A includes...all buildings, gardens, trees, liberties, etc...” In s.3 there is then an expanded definition of the term land. (c) Under s.186(4); (d) 186(5) default position is fee simple; (e) s.186(6): if transfer contains words of limitation, transfer operates to transfer freehold estate of transferor in land to transferee in accordance. 186(7) “reservation or condition” transferor keeps something for himself. If you see grants made by Crown to

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SD 52: for as long as property used for school. If school later wants to sell it to be used not for school - the purchaser does not get fee simple. Conditions do not appear in the search***. Often involves park lands. (f) When you take Form A and its register it passes legal ownership to the purchaser. P now has legal and equitable interest.

Property Law Act s.5(1): a person transfering land in fee simple must deliver to [purchaser] a transfer registerable under Land Title Act. The transfer is “Form A.” However, the practice in BC is that the purchaser (transferee) - it is their obligation to prepare Form A which is sent to vendor for signature and vendor delivers document back to the purchaser.

Land Title Act 185(2): you dont’ need Form A if a form of transfer is prescribed by another enactment [eg: Crown grant]... or if, in opinion of registrar, it would be proper to accept another form of transfer.

Contract: agreement between two or more persons which create an obligation to do or not to do a particular thing.

Deed: was a contract under seal. A sealed instrument (anything reduced to writing) containing a contract or a covenant delivered by the party to be bound by it and accepted by the party to whom the contract is addressed or with whom the covenant runs. MODERN MEANING: a document signed, sealed, and delivered through which an interest or right passes from one person to another - it is a writing under seal by which a freehold estate in land is coveyed.

Covenant: could be an agreement; could be a promise by one person - fact of under seal deals with consideration. TODAY: it is used in sense that “George promised to do something.”

Delivery: was an act by which the res or substance thereof is placed within the actual or constructive possession or control of another - it was delivery that passed ownership (without documentation). The intention of the person parting with the res is critical - concept emerged that to have true delivery, the deed must have been placed in hand of grantee or within his control with intention it is to be presently operative as a conveyance.

***Transfers must be executed by registrable documents.***

TRANSFERING LAND BY GIFT (InterVivos) donatio mortis causa:

A gift is a voluntary and intentional transfer or property from the owner to another without consideration.

Generally a gift is not enforceable because there is no consideration. However, there developed doctrines which, if you meet certain criteria, you do have enforceable gift.

Intention to donate: on part of donor to make “an outright gift” and part with ownership. (a) Donor must have mental capacity; (b) words or actions of the donor must be unequivocal. Other things considered: size of gift and its relation to what donor owns in total; relationship between donor and donee.

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Must be acceptance by the donee: unless donee outright refuses the gift.Delivery: words alone are not enough - requires physcial parting. Delivery is transfer of possession of the item or something equivalent to that. Delivery is not just evidence, it is required to complete the gift. Parting with physical possession is good indication donor intends to be bound. Has donor done everything that needs to be done in order for transfer to take place?

Examples of where possession is not enough:- Paperwork has to be done, and in BC, has to include Form A. - There are circumstances where you could have transfer of owner- ship of land without Form A. Trusts can be created in a number of different ways: a declaration by owner saying they hold property in trust for someone. Trusts don’t require paperwork OR parting with possession. “I hold acreage in trust for Mary.”

Though all steps are required to transfer gifted property, only the first four are required for court to find gift complete and enforceable: (Intention, Acceptance, Delivery, Donor done everything required). Not necessarily required: (Registration - resolution of Resuting trust issues).

Resulting Trust Issue: If terms of gift are that he must remain living on property until death, only legal ownership transfers, not equitable.

Romaine v. Romaine: A contract under seal (including gratuitious promise) will be enforced even without consideration, provided parties intended to make document a sealed document.Claude owns acreage - wants to give it to nephew Michael before he dies to avoid taxes. There is: (a) Letter of gift; (b) Delcaration of Trust; (c) Form A transfer; (d) Form A registered. Lawyer must have been concerned so thought DofTrust would help. Relationship deteriorates. Claude tries to get land back - he dies - estate continues the fight. Question: What is legal effect given to “letter of gift” - what is legal effect? Was it signed, sealed, and delivered? Did sealed contract rule still apply in BC? There was no dispute Claude signed gift documents - circle was a copy of a red wafer seal affixed to documents. Note: wafer should be affixed at the time it is signed. Owner must truly intend to make a gift.

You have to have intention, acceptance, and delivery. You DO NOT have to physically part with possession in order to have proper delivery...according to this case.

Ross v. Ross: Physical delivery of a deed to grantee is not necessarily required to constitute effective delivery, and thus enforceability of a transfer. Intention of grantor is what is important. Grantee need not be aware of gift. Enforceable gift despite no physical delivery.Grandma owns property and had lawyer prepare deed conveying property to her grandson, Donald “signed, sealed, and delivered” - her signature appears opposite. Question: was there delivery of document? She kept document in her purse. SCC: you do not need to part with possession - physical delivery of a deed to the grantee is not necessary to constitute effective delivery. REAL issue: intention. Suggestion that if you have words on document “signed, sealed and delivered” it creates rebuttable presumption that there has been delivery.

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Zwicker v. Dorey (Nova Scotia): Efficiency of deed depends on it being signed, sealed, and delivered by the maker of it, not on his/her ceasing to retain possession of it. A deed signed, but explicitly held to be delivered on death is not enforceable transfer.There was deed signed - note was that deed not to be recorded until owner’s passing away. Two issues: (a) whether this was testamentary gift (because only to take effect upon death). Inorder to be valid testamentary gift, it must apply with requirement of Wills Act which says if you are going to have document which disposes of assets on death it has to be signed (two witnesses present), sealed, and delivered. (b) Whether there was sufficient delivery: there is no requirement a deed must be recorded in order to be effective. In the end, it was testamentary and ineffective, and it was not delivered: grantor continued to occupy and use the land, paid taxes AND made several grants of the same land after the deed. There was insufficient intention. [ESCROW: something goes into storage/custody - often to a lawyer (third party). If grantor puts it in hands of escrow holder, he has done everything he has to do. However, in this case, escrow was not sufficient, because delivery not to take place until death of grantor.] What if jurisdiction is one where there is land registration system? - like in BC. Question: Do you have to have registration in order to complete the gift? Land Title Act s.20(1)(2)(3): seems to indicate there must be registration - but there is an exception. The purchaser is at risk until registration because if vendor deals with purchaser #2 who gets registered - they are going to be ahead of purchaser #1. DIFFICULT.

MacLeod v. Montgomery (ALBERTA): For gift to be enforceable: donor must have intention - donee must accept - must be deliver which includes doing everything required to enable transfer of property (in this case the delivery of transfer form and duplicate).Different system. HM grandma owns property ---> transfers land to granddaughter ---> gift ---> grandma holds back life estate for herself (transfers fee simple but held back life estate) ---> there was a transfer document which granddaughter got ---> no registration, registration cannot take place, even though transfer document is in grandchild’s hands she does not have duplicate title ---> in BC/AB if you don’t have duplicate you cannot have any dealings with respect to property ---> granddaughter did get promise that grandmother would send duplicate but it didn’t happen ---> was there a completed gift?We have document - we have registration scheme - we are missing duplicate title. Granddaughter does not get the land. s.56 in Alberta is same as s.20 in BC. Instrument must be executed according to provisions of Act --- in BC, that would mean FORM A. You have to register to have interest passed. Court said there was no valid gift because the “donor was obliged to do what can be done - donor is obliged to do everything that the donor has to do.” Not valid because no delivery. There was no evidence that donor instructed her solicitor’s to complete the gift. *There are circumstances when registration is not required.*

SUMMARY: If Romaine is ideal where do we stand in BC: in order to have valid gift you must have intention and acceptance. What does delivery have to be in BC where there is registration requirement? Delivery does not have to be a physical parting; however, the donor must have done everything they are obligated to do. That would include Form A (or equivalent), making sure duplicate certif of title is either with Form A or been surrendered to LT office. It includes sufficiently parting physically (delivery) on that element. Either part with possession with no strings attached or you carry it in

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your purse, etc - but no registration is required. Parting could be to escrow holder, sitting with lawyer, in a safety deposit box.

Example: Form A in card under Christmas tree. Is that enough? If there is envelope with Form A with duplicate - you might have it.

Now assume there is a valid gift: you have intention, acceptance, delivery. The donor has done everything he has to do. A (donor) ----> gifts to B (donee). Another principle arises in trust law: You have settlor transfers property to trustee ---> beneficiary. Legal ownership given to trustee, beneficial ownership to beneficiary. You can do so expressly (I give you $10 and you are to hold it for X) - can be in writing or oral. However, there are circumstances where a trust arises by operation of law - when circum exist, judges will impose trust concept. One circum: where there is transfer from A to B with no consideration, B holds the asset in trust for A - law presumes a trust which results back to donor (transferor). Where you have a transfer with no consideration (gift) there is a presumption of a resulting trust. The legal owner becomes B, but beneficial owner (true owner) is donor. A presumption: in absence of evidence to contrary, beneficial ownership goes back to grantor - burden falls on B to show that A intended to pass the full interest. In most situations, you can show there was intention (when someone gives you birthday gift) - surrounding facts make it clear you have ownership.

Resulting trusts: Presumption that legal owner is holding ownership in trust for the grantor - intention that only to give legal title and not equitable. Unless you can prove otherwise, law will find resutling trust. How does grantee get rid of it? It can be rebutted by evidence of intention - circumstances surrounding which would suggest the grantor (1) intended both legal and equit interest were to pass (sealed gift document stating intention) like Romaine. To help transferee law came up with other presumptions: (2) presumption of advancement - donee is infant child or married spouse; (3) Other evidence (acts or words). - If presumption rebutted - full ownership, including equitable, passes to donee.

(3) WILL OR INTESTACY

When minors pass on - problem - they cannot make a will (unless they are married or have been married) - or if a member of Canadian Armed Forces.

Four statutes in addition to common law (combination):

Wills Act: Sets out formal requirements necessary to have a valid will.

Estate Administration Act: deals with several issues. In particular it deals with what occurs if a person dies without a will (intestate distribution scheme).

Trustee Act: The excector is a form of trustee - so some of the provisions apply to executors. Executor’s job is to administer estate of the deceased - yet the will often has ongoing obligations in nature of the trust.

Wills Variation Act: Even if you die with a valid will (formalities according to Wills Act) - if a spouse (broad def) or a child (biological/adopted) - you can bring an action under WVA where you say - I have not been fairly treated. Court can look at all surrounding cirumstances - includes deceased’s legal obligations (if a spouse, you find them in

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Family Relations Act). Courts says: look first to legal obligations and second to testator’s moral obligations. Even if you have more money than parents you can say they have moral obligation to you. Courts may take any reasons to account for parents not giving their kids money in will - but - courts have said they are entitled to look at reasons and decide whether rational.

Distribution of Assets on Death

Common Law (historical): personal property on death went to the personal rep of the deceased - executor or administrator (if no will). Real property went to oldest son (heir). No dist scheme. ESA says who administrator is - scheme is spouse, and then “next of kin” - interpreted case law - nearest next of kin.

If there is a will - it tells executor how to allocate assets. Will: document in writing making clear it talks about distribution of assets on person’s death and it must be wittnessed in correct way (2 present at time). If person writes will and becomes mentally incompetant - will stays the same and cannot be altered.Testamentary vs. InterVivos Gifts

InterVivos:Immediate: gift not postponed to some future time;Irrevocable: because gift is completed;Exception: donato mortus (irrevocable does not apply);

Testamentary:Dependent on death: donor’s death is trigger of transfer;Revocable until moment of deathGift subject to debts of deceased being paid first.

Intestacy: Estate Administration Act: Who is going to administer estate? Gives options of who can qualify, but does not specify priority. Default is generally closest next of kin who is beneficary. Who inherits? s.81 establishes priority of distribtution: spouse, children, grandchildren, parents, siblings, nieces/nephews. Next of kin a blood relative (including half-blood relations).spouse - spouse gets allspouse and children - spouse gets first $65K, then remainder split 1/3 to spouse, 2/3 to children. NOTE: anything spouse gets in joint tenancy and assets with designated beneficiary (RRSP beneficiary and life insurance) not included in calculation. No spouse, no issue (children, grandchildren, etc) - parents get all in equal shares.No spouse, no children, no parents - siblings get all in equal shares, and so on...Only if no relatives will estate go to governments - Escheat.

A and B live together common law. A is 24 years old, B is 25. Each have $50K and no children. A and B get in car accident. A and B both die with no will. You must decide who died first! If you can’t tell - presume oldest died first. B’s money goes to A. A dies - it all goes to A’s family. B’s family gets nothing.

Donatio mortis causa: gift made in contemplation of death. Three elements necessary: (a) Must be made in contemplation of death but not necessarily with expectation of death. (b) There must be delivery to donee - not necessarily handing it over physically -

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maybe less formalities of delivery; (c) Must that gift was to become absolute on donor’s death.

(d) PROPRIETARY ESTOPPEL

Another way to acquire interest in land. Five elements of PE: P must have made mistake as to his legal rights;P must have expende some money or done some act on faith of his mistaken belief.D must know of existence of his own right which is inconsisten with right claimed by P.D must know of P’s mistaken belief in his rights.D must have encouraed P in his expenditure of $ or other acts.Zelmer v. Victor Projects: Defendant cannot subsequently restate himself when P has relied upon what he has stated. An easement can be created by proprietary estoppel. PE can be used as a cause of action.Zelmer owned land - wanted to develop it - to do it they needed water and reservoir for water - had to be at higher elevation. Approached neighbor (D) - discussion takes place - D agrees - no compensation necessary. P constructs reservoir - D says it is in wrong location and wants it out. P says we have easement - right to go over neighbor’s land to get access. Easement: interest in land. Judge accepts P’s version of facts. When P to knowledge of D acts to his detriment on his own land in expectation encouraged - the court will order right granted. This is not acquiring land by prescription or squatter’s rights.

Decision: P acquired an interest in the land. P awarded easement.

Tretheway-Edge Dyking v. Coniagas Ranches: It is unconscionable, inequitable, and unjust for D to assert his legal rights inconsistently with his words and conduct.Appeal by D from decision granting P a permanent easement over D’s lands on ground of PE. Decision upheld.

UNJUST ENRICHMENT: A cause of action (like trespass or negligence). The remedy of CT creates an interest in land. UE is Made in Canada doctrine.

In BC, regardless of who is registered owner, it is equally owned by parties of marriage due to Family Relations Act. In past, Murdock (Alberta), traditional marriage - wife got nothing after 43 years. Later, Rathwell, same fact pattern, wife got 1/2.

Three elements of UE: (a) Must be an enrichment; (b) Must be corresponding deprivation (makes contribution and is in someway deprived - suffers loss as a result; (c) Must be absense of jurisdic reason - absense of legal reason for deprivation and enrichment (contract). Now applies in business settings, etc.

Remedy: Damages. If P makes contribution to D’s land, how to calculate value? Look at increase in value of land; number of hours X hourly wage; % of income of asset. Constructive Trust: rather than quantify P’s claim by saing it was dollar figure: --> P acquires % ownership interest in land itself. When land is sold, you get %age. Generally, courts say if substantial link between provision of services and the property.

1985 case in BC: 27 year old P, stewardess - met 30 year old business executive - relationship ended 1988 (3 years) - during relp, executive did renovations - she helped him with advice (picking colors, not much work) - during 3 years she did some domestic

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work, he became ill, she nursed him - he dies - she makes claim against house. Court gave her chunk of house ($45K) --> 10% of increase in value.

CHAPTER 5: Registration of Title Overview.

Mechanisms by which interests in land get to be passed:Livery of seisin - lack of documentation.Recording system: moved to ownership transfer based on documents (had to be in writing). Paperwork had to be recorded - you had to deposit documents that caused transfer at office of some kind. It isn’t deposit of documents that transfers interest - location for people to go and see what happened with land (search). Role of lawyer - go to office - examine - give client opinion on goodness of title (abstract of the title) - condensed history of land - summary of dealings. Rule came - only had to search ~ 30 years. Exists in Ontario.

Differences between registration and recording systems: Registration system has legal effect on title, where recording system simply a record.

Torrens Land Reg System: Since beginning of BC - land registration system essence: Once a fee simple interest is entered on register that is conclusive evidence that person named on register is owner of the interest. The mere fact of registration (getting Form A registered) creates rights for you. s.23 of LTA: “An indefeasible title (registered interest) is conclusive evidence at law and in equity as against the Crown and other persons that the person named in the title is indefeasilbly entitled in fee simple to the land described in the title.” Curtain principle: when you register the curtain descends - you don’t have to look behind curtain anymore.

Before Land Reg System in BC (1860), there were some dealings in land. 1860 was magic date when TS came to Vancouver Island - not mainland until 1870. Original statute of 1870 is LTA. How do you get lands disposed of prior to the system within the system? If you had interest in land and wanted it within system you (a) brought documents to registration official. If it appeared you had good title, your interest registered in Register of Absolute Fees; (b) Passage of 7 years - if no challenge, you were given indefeasable title. s.174: “the registered owner of absolute fee of land...” Method still exists as thee could still be an owner with old absolute fee interest. They abolished it, but if for some reason they missed you - here is a way to get into system. s.393: Preserved concept of absolute fee.

Not all land in BC is within land title system! (a) Some federal lands; (b) Some national harbours; (c) some Indian reserve land; (d) aboriginal title lands; (e) some provincial Crown lands.

s.171: Adverse possession cannot be a basis for an application to get indefeasible title. It has been abolished.

BC: statutory scheme. But, in background is common law, and there may be rights and obligations there - despit statutory scheme. Sometimes judges rule that despite statutes, there are common law rights that still exist - and overrule statutes.

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There are 7 Land Title Districts: Kamloops, Nelson, New West, Vancouver, Victoria, Prince George and Prince Rupert. Originally seven LT offices. BUT now, just Kamloops, PG, Victoria, and New West (Vancouver). Each office has a Registrar of Titles, with certain statutory duties - both administrative and quasi-judicial duties (s.169(1)) - the Registrar must, if satisfied, s.10, s.15 (seal), s.16 (hours). If you go to Victoria office, it has records for Vancouver Island - there is NO central location in province for records of whole province. If you have Lot A, Plan 4721, you MUST know the district. Under s.16, “Registrar must keep office open to public everyday from 9am-3pm.” You can only do land transactions between those hours.

What Interests in Land can be Registered Under the System?

You can register only those interests, which were recognized as interests in land at common law. Specificaly, you cannot register Ab titles, and zoning bylaws as they are not interests in land for the purposes of registration, including:

Easements Fee Simples Life Estates Leases

Some common law interests are not registrable: s.33: “an equitable mortgage or lien created by the deposit of a duplicate

indefeasible title or other...is not registrable.” Arises most often from the fact that there is duplicate certif or indefeasable title. Bot original and duplicate are kept in LTO. EM: assume family memeber wants to lend you $10K - you have land free and clear. They want security: “Give us your duplicate title.” If they hold title, you can’t do anything with the land. You cannot take an equitable mortgage and register it.

Trust: s.180: if land vests in a trustee, that person’s title may be registered, but the particulars must not be entered in the register.” NO mention of beneficial interest - but what you will see is (In trust DD ##). DD: document deposited - if you go and look at it you can see the trust. There is registration of the common law interest, but not full indication of the details in the trust.

s.200 of the Act has to do with sub-rights to purchase. If an agreement for sale (or right to purchase) is registered on a title, and the owner of that agreement for sale enters into another agreement for sale with a 3rd party, the subsequent agreement for sale cannot be registered - that is sub-right to purchase. Could not be registered after October 1979.

Some non-common law interests in land can be registered (found in statute rather than common law). Statute created/allowed certain things to be registered:

Caveats (s.282): “A person claiming under an unregistered instrument which is incapable of immediate registration, or who is claiming an interest by operation of law may lodge a caveat preventing regis of a dealing with a land...” Where you have a claim against the land which you can’t get registered (operation of law...resulting trust). Caveat is a blocker: blocks further dealings in the land - self-help remedy where you think you are going to lose out - how do you get notice.

Certificate of Pending Litigation (CPL s.215): this becomes a charge aganst the property. CPL does not halt proceedings dealing with land, but anyone who does any dealings with property does so based on outcome of any pending litigation. Practical consequence: no one deals with land with certificates of pending lit.

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Judgment (s.210): You can register a judgement against any land. One person sues another for money. If P successful you have money judgment. How do you collect on that judgment? Try to realize on any equity debtor has on interest in land. You must register judgment against debtor in LT office. Court Order Enforcement Act: you can force sale. Note: Registration of judgment expires in 2 years after registration unless you renew it. If you fail to renew within 2 years you can re-register. If you wrongfully register a judgment you must compensate them with damages if they suffer.

(Statutory) Right of way (s.218): Term that closest describes right of way is an easement. For easements there must be 2 parcels of land, but for a right of way this is not required. RW are generally granted to gov’t types of orgs (Hydro). RW and easements are not interchangeable. Certain government bodies have right to get easements. Not recognized in common law.

Filing Under Agric Land Commission Act : regulates use of land that has been designated agricultural. Province imposed zoning on agri land and by statute said you can take this designation and file it. Restricts what you can do with your land. Hundreds of thousands of titles are affected.

Family Relations Act : (s.17) if people enter into marriage agreement, or separation agreement/exit agreement, you can register that agreement in the LT office. Means you can restrict how these people can deal with the land (won’t dispose of their interests).

Covenant : (s.219) - at common law the covenant that one owner could have over another’s land had to be restricted (could be negative - you can’t do this...) but it could not be positive (you must do...). S.219 allows for positive covenants. Covenants by and large must be in favor of a government body. Section 220 deals with statutory building scheme which restricts uses, but enforcement comes from adjacent property owners rather than the municipality (ie: specifications dealing with anything [no clotheslines, no RVs in parking lot] so you always want to have a look at the statutory building scheme before purchasing a lot.

Basic Scheme of Registration

(1) Legal Fee Simple Interest: Fee simple owner has surface, but you can take total ownership and split it up into different parts (surface, airspace, mineral). If you are fee simple owner of mineral rights, rights appear as charge. Exceptions:Airspace (s.141): if there is fee simple owner of airspace you can get title for that air space and register that title seperately for surface title (airspace won’t appear as a charge on orig title);Strata Title Properties: you own condo and 1/16 interest in common property. There is no seperate title for the land on which the condos lie.

Section 169(1): hold if you go to regiter a fee simple the registrar must register it, but must be satisfied that the boundaries are sufficiently described, and there is good safe holding and marketable title in fee simple. OWNER’S name must match correctly.At same time you file application (Form A) you must also file a property purchase tax form. You no longer have to file citizenship form.

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LTA has four different freehold estates: (a) fee simple; (b) life estate (appears as charge); (c) determinable fees; (d) fee simples on condition (ends when event specified on condition occurs).Acquisition of fee simple interest on death is treated differently than intervivos.Where interest is transferred upon death the word used is “transmission” rather than “transfer.” Transmission is a change of ownership: (a) effected by operation of an Act of law; (b) under order of a court; (c) consequent on any change in office of a personal rep or trustee.Transmission is something triggered by an event (s.265). End of fall term.

(2) Charges (s.1): “an estate or interest in land less than the fee simple and includes an estate or interest registered as a charge under s.179 and an encumberance (judgment, mortgage, lien, Crown debt or other claim to or on land...)”

s.197(1) – on being satisfied…the Registrar must register the charge. The Registrar may refuse to register…if of the opinion that good, safe holding and marketable title has not been established or the charge is not a registerable interest in land.

Fee simple category and category of charges – it will be one or the other. Difference between 169 and 197: does not deal with boundaries. Good safe holding and marketable title : first thing you look at – is person’s name

who is holding interest on register? Judgments : (s.210-14). A has claim against B. A takes the claim and converts

the claim into a judgment for money. You can take the judgment for money and register it against land. Once done, you can take proceedings to collect on that security (court ordered sale). Note: judgment may not appear as charge, but can relate to land (judgment obtained to have ownership transferred by court action. Form 17: submit with a certificate of judgment. This registration has a time limit – under the COEA the judgment expires in 2 years and must be renewed before they expire.

Power to file a caveat (s.285): generally speaking they have feature attached to them that does not apply to regular caveat – NO time limit.

R v Kessler: In Torrens system, zoning bylaws are not to be registered.

ROLE OF THE REGISTRAR Administer LTA, with respect to those lands located within their District. Registrar also had judicial role, where he acts on certain principles of law –

looks to property law for guidance. Administrative duties: more based on policy or expediency, rather than the law.

Registrar can make up administrative rules that may frustrate practitioners because it may not respect economic reality/private practice.

Powers that Registrar has come from LTA. Registrars, while not judicial, are not s.96 judges (Heller v. BC).

When Registrar considers the validity of a document and the right to registration, there is a quasi-judicial function, because while they do not have power to adjudicate on questions of title, they do have the power to apply some law to the facts and make a decision.

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Skeetchestn Band v. BC (2000): Aboriginal title is not an estate or interest in land that is registrable under the LTA. Shows how not all interests can be registerable, and the Registrar’s quasi-judicial power.Band thought they had aboriginal title – RO of the land wanted to build a resort which the band did not agree with. Attempt to stop the development – applied to register CPL – refused b/c of s. 168 – used s.311 to ask for explanation.Registrar decided that ab title was not an estate or interest in land registerable under the LTA, based on Delgamuukw v. BC. CA upheld Registrar’s decision:

1. Has Delgam (1996) overtaken Delgam (1987)? Both still apply. The court has not stated how conflicts between ab title and indefeasible title should be resolved.

2. Is ab title marketable therefore registerable? Because ab title is inalienable and can only be surrendered to Crown, it makes little sense to suggest it is safeholding and marketable.

3. Does Torrens objective of giving notice warrant the registration of the lis pendens and caveat in this case? Delgam states a claimant may not file a lis pendens if his claim is in respect to unregisterable interest in land.

4. Is ab title registrable under s.23(2) of the LTA? No.5. Is ab title registerable as an encumbrance? No.6. Is there violation of Charter in preventing registration of lp? Need a full hearing to

decide this matter – not appropriate here.

Re Evans (1960): Example where registrar refused to register land because there was uncertainty that had to be rectified. Court found they didn’t have to perpetuate the previous error. When there was a previous error, registrar can step in and attempt to correct it.Land parcel originally registered as 66’ “more or less” – subdivided so that east 26’ was registered – west lost sold, Evans tried to register as 40’ – registrar refused because of insecurity of exact boundaries.

What does Registrar do?Look at documents, ask: (a) Does instrument deal with interest in land? (b) Is that interest derived from RO? (c) Is transaction evidenced by an instrument which is valid on its face? Does it appear without going to any surrounding info that there is an error or not?

In doing so, Registrar is trying to avoid giving validity to an illegal or improper transaction, because s.23 of LTA states that effect of registration is to put a stamp of validity on the title.

There are sections within the Act, (s.159-60) allows him to get evidence to validate an instrument presented for registration. S.163 gives notice that if the evidence is not presented, the Registrar will take a stated action.

Shaw (1915): It is within Registrar’s jurisdiction to look behind an agency agreement.Power of attorney allowed Shaw to deal with his father’s interest in land. Shaw tried to use power of attorney to assign the father’s interest in a mortgage to himself. The Registrar refused because on the face of it the transaction was improper – POT cannot transfer it to himself. Note: you can draft power of attorney that permits transfers from person granting power of attorney to the person receiving it. Registrar refused registration until father was contacted (PLA, s.27).

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Power to correct or cancel instruments (s.383). BUT: If error is there, someone has come along and acquired interest, to correct error would take something away from interest that has been required and so Registrar cannot do that.

Special Note: Duplicate title cannot be issued if title subject to either a registered mortgage or agreement for sale!Heller v BC (1963): Registrar cannot affect the rights of others by correcting something – there are limits. The Registrar cannot adjudicate on the rights between parties – this is discretionary.Husband tried to transfer land to wife – Registrar registered it – no duplicate certificate of title on file – Duplicate already given to someone who already had a half interest transferred – Heller tried to have transfer to his wife reversed due to error – Registrar refused – SCC agreed with Registrar.

ASSURANCE FUND

Registration creates indefeasible title (s.23): “a title that cannot be defeated, revoked or made void…conclusive evidence that person named in title is indefeasibly entitled to an estate in FS to the land.” The origin of AF is: you want to take away uncertainty (make people get what they think they are getting).

Torrens land registration system sometimes takes away people’s rights – when a statute takes away their rights. AF is a statutory scheme of compensation. s.295f of LTA: you must show you lost interest in land (a) because of conclusiveness of register. If it can be shown it was due to CL no claim (s.296); (b) Must show you lost results solely as a result of omission/mistake of registrar; (c) Limits on what you can recover; criticism is that the AF is empty concept because difficult to succeed in claim and compensation is limited.

McCaig v. Reys (1978): In order to be successful against AF, the claimant must show that: (a) They’ve been deprived of land or interest therein; (b) The loss was occasioned by the operation of Land Registry Act; (c) Loss was occasioned by fraud, misrep or wrongful act in registering of another person as having interest in the land; and (d) that he is barred for bringing an action for rectification of the register.Reys purchased land from McCaig & reg’d his interest – Reys gave McCaig unregd option to buy back some land – Reys sold land to Rutland, who knew of option but sold to Jabin w/o disclosing – McCaig sued Reys for breach of K, Rutland for fraud & inducing breach of K, & AF for defeating option. Court would not allow against AF because CL, the transfer could never have taken place – it would have been voided. A didn’t lose out because of statute so AF does not apply. Note: McCaig suffered loss as a result of wrongful acts of other parties involved. Jabin bona fide purchaser and can’t be forced to give up title. Note: Actions against Reys, Rutland could give rise to damages, so AF not necessary.Gordon v. Hipwell (1952): Sucessful claim against AF when registrar incorrectly removed a caveat.

CHAPTER 3: Aboriginal Title.

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St Catherine’s Milling and Lumber v. Queen (1889): Crown can permit use of land by abs. Ab rights simply burden on underlying title of Crown. Rights are something less than ownership and can be extinguished without consent. Source of Indian title held to be Royal Proclamation. Nature of rights held to be personal & usufructory. Co had license to cut timber – prov govt challenged validity of license – necessary for court to make statements about origin and nature of ab title – land in question surrendered to fed govt in 1873, subsequent to that the co acquired its timber license – Royal Proclamation Act 1763 reserved rights to Indians – no private person could purchase Indian lands, only the Crown.

Discussion in case: (a) Origin of rights, RPA, 1763; (b) Nature: “vested in Crown was a substantial and paramount estate underlying the Indian title, which became plenum dominium (full ownership) when Indian title was surrendered.” [Suggests the ab people have something]. Nature of the tenure (interest): it was said to be a “personal (right or interest less than an estate in fee simple) and usufructory (right of enjoying a thing, the ownership of which is vested in another) right dependent on the goodwill of the sovereign.”

Calder v. BC (1973): [No establishment of rights in this case because they had been extinguished. BUT six judges said we buy into idea of aboriginal rights]. Origin becomes fact of occupation and possession; nature of title not really defined here. It was the first time that Canadian law acknowledged ab title to land existed prior to the colonization of the continent and was not merely derived from statutory law.Aboriginal rights: practices, traditions, customs which were integral to distinctive culture of ab group. Ab title: right to land itself. Action by Nisga’a for declaration that their title to ancient tribal territory had not been lawfully extinguished. Three judges said that the rights were extinguished. Three judges said there were rights that existed. ONE judge said natives had procedural problem.

Did RPA of 1763 apply in BC since BC was not yet formed? When the settlers came, the Indians were here, organized and occupying the land. This is what Indian title means – it does not help to label it personal or usufructory – wrong to say origin is RPA of 1763. “Ab people had right to continue to live on lands as their forefathers, and this right has not been extinguished, but is dependent on the goodwill of the sovereign.”

Discussion on fact that claim was not for title in fee simple, but more like equitable title or interest – a right to occupy lands, enjoy them, but not challenging Crown’s right. Their claim is for right of occupation against the world except Crown. “Right to possession is not prescriptive as that presupposes prior occupation. In the case of ab claims, they are the “first possessors” therefore it is not that they have usurped possession (squatted) of another’s land.”

Nature of ab title: “an interest which is a burden on the title of the Crown an interest which is usufructory in nature, a tribal interest inalienable except to the Crown, and extinguishable only by legis enactment by Parliament.”

Guerin v. Queen (1984): Aboriginal interest “sui generis.” Ab interest in land “pre-existing legal right” derived from ab practice and not from any BC or Canadian action – founded in historical occupation. “Special right” means that title to aboriginal land can only be alienable to the Crown and the Crown can only use it in the interests of the aboriginals.

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This case dealt with golf course of Musqueam reserve at UBC.Legal Origin of Aboriginal Title

Calder stands for proposition that ab title is legal right derived from their occupation and possession of tribal lands.

Confirmed RPA 1763 not applicable. Referred to US Johnson that although they acknowledged Proclamation as

one basis for title, that the right to lands both predated and survived claims of sovereignty made by European nations.

The principle of discovery by Europeans which justified claim to sov, gave the ultimate title to nation that had discovered and claimed it. Ab rights diminished, but rights of occupation remain unaffected.

In establishment of relps between natives and arriving nations, the rights of original habitants were in no instance entirely disregarded, but were necessarily to a significant extent impaired. With a right to occupation and legal claim to retain possession.

Origin that ab lands are inalienable except to Crown. Change in sovereignty does not affect ab title. Indian title is independent legal

right.

Nature of Aboriginal Title St Catherines: Indians have personal and usufructory right in lands, which

they have traditionally occupied. Title of the sovereign is a pure legal estate, but one that can be qualified by

use of a beneficial user that does not necessarily take the form of an estate in land.

Indian title in Canada was said to be an illustration “for the necessity of getting rid of the traditional English approach to land ownership.”

None of the judgments equate that the beneficial interest is exactly the same as the personal and usufructory right. Move form St. Catherine’s to the beneficial interest concept.

Aboriginals have “unique interest in land.” Courts have difficulties because they have tried to describe ab title by using CL or equitable legal concepts. It is a sui generis type of interest: characterized by its general inalienability, coupled with the fact that the Crown is obligated to deal with the land on the Indian’s behalf when the interest is surrendered. Any description which goes beyond is both unnecessary and potentially misleading.”

R. v Vander Peet (1996): Aboriginal rights are personal under the Charter and are distinct. Ab fishing rights do not extend to the right to sell those fish for commercial purposes. Test for whether given practice part of constitutionally-protected rights: practices, customs and traditions must have been an integral part of the distinctiveness of their culture prior to colonial contact.He was found guilty because judge found that historically there was no selling of fish by the band.

“In order to be an ab right, activity must be an element of a practice, custom, or tradition integral to distinctive culture of the ab group claiming the right.” Applying these tests the court said that the practices, customs, and traditions of the nation included commercial fishing, but the court gave deference to the trial judge that while “some exchange took place, it was not a significant integral or defining feature of that society.” Conviction upheld.

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Mabo (1992): Native title originates from a connection with the land by indigenous people under their own customary systems of law prior to colonization.(Australia) – rights of the crown vs. rights of aboriginal people.

Delgamuukw v. BC (1997): Aboriginal title is a right of land, more than the right to engage in between these two positions. It confers the right to use the land for a variety of activities which may not all be integral to previous ab uses of the land – it is less than ownership, but more than a right to occupational use. Position of aboriginals: we have “inalienable fee simple” which confers upon them to use lands as they choose – a right protected by s.35 of Charter.Position of BC: Title is “bundle of rights” to engage in activities; at most it encompasses right to exclusive use/occupation of lands to engage in activities. Court ruled: it is somewhere between these two. The range of uses is subject to some limitations – SEE para 111 of case.General features of aboriginal title: sui generis

It is distinguished from fee simple title:o Inalienability to 3rd parties except Crowno Source: arises from prior occupation of Canada by abs – physical

possession before British sovereigntyo A collective right to land, held communally – how is that community to

deal with communal ownership – self govt. It cannot be completely explained by common law or ab law systems.

Content of aboriginal title: What does “personal and usufructory” mean? Ab title encompasses right to use land held pursuant to that title for a variety of

purposes, which need not be aspects of those ab practices, cultures, and traditions which are integral to distinctive ab cultures. But it does NOT amount to a form of inalienable fee simple. It cannot be limited in its uses by support from:

o Canadian jurisprudence on ab title: suggests title is more than right to enjoyment and occupancy

o Reserve lands: not restricted – why then should there be restrictions on other lands?

o Indian Oil and Gas Act: presumes title to reserve lands also encompasses mineral rights, and lands are capable of exploitation in ways that may not be a traditional use of the lands.

Inherent limit: lands held pursuant to ab title cannot be used in manner that is irreconcilable with the nature of the attachment to the land which forms the basis of the group’s claim to ab title. Land has inherent and unique value in itself, which is enjoyed by the community with ab title. The community cannot put the land to uses which would destroy that value.

Contrast ab title to fee simple: ab title has inherent limits, fee simple does not. [Note: fee simple can have limitations, but they are not result of ownership (criminal laws). However, if person has life estate or land is leased, they have restrictions inherent in the title that arise as a result of that form of ownership.] NOTE: possible for two ab groups to have ab title over same land if interest can be reconciled & co-exist (Skeetchestn quotes Delgam).

Limits placed on aboriginal title:

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Cannot be used in manner irreconcilable with nature of claimant’s attachment to those lands.

Cannot threaten future relationship of ab people to the land. Must be reconcilable with nature of occupation of that land and the relationship

that the group has had with land. If group engaged in hunting activity on land they cannot now engage in strip mining.*

Relationship between community and the lands has an important non-economic component. Community cannot put the lands to a use that would destroy that value.

To use lands in a way that is limited by aboriginal title, the land must be surrendered to Crown, so that they can be put to that use. In that surrender, it must be done on terms that the use may be permitted. Eg: turn over lands to fed to build shopping mall, Indians get all the revenue.

The use is not restricted to those activities that have traditionally been carried out on it. That would amount to a legal straightjacket on aboriginal peoples who have a legitimate legal claim to the land.

R v. Marshall; R v. Bernard (2005): Attempt to apply Delgamuukw – begin to define broad principles from Delgamuukuw – NARROWING them. Delgam requires that in analyzing claim for ab title, both ab and Euro CL perspectives must be considered. Court must examine nature and exten of the pre-sov ab practice and translate that practice into a modern, CL right.Logging by ab people on Crown land – prov statutes regulated logging – aboriginals took view they were not under statutes because they had treaty rights OR aboriginal title so they could do what they wanted. Convictions against Indians upheld – could not establish that they held title. These cases discuss significance of possession: court says if we recognize ab interest in land we must link it to some CL interest – if we recognize title, we must link it to fee simple. Title: “established by ab practices that indicate possession similar to title at CL.”

CHAPTER 6: Registration.

A. REGISTRATION AND THE FEE SIMPLE

Registration and indefeasibility of title – s.23 of Land Title Act

Nothing says in order for you to obtain title that you must register. Exception: Crown grant (Land Act s.54). Why register? Get better security of interest particularly as against third parties who have registered interests. [s.20 of LTA] appears to say you should register in order to have interest passed, yet opening words create exception. Cost: some may lose interests had at CL.

Creelman v. Hudson (1920): The register is conclusive. If you get on title, curtain comes down and you can’t look behind it! [Land Title Act s.23(2)].

Lawyers role in the acquisition and disposition of land:1. What is land? – not only dirt; but house, air, shed, etc. Know the rights

associated with that land.2. Find out legal description of the land.

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3. Do search in Land Title Office – what is on register?4. Analyze title search.5. Keep in mind a number of charges will be discharged at the time your client

acquires land (previous owner’s mortgage) - using undertakings between lawyers to have encumbrances removed with $$.

6. Know which charges remain after registration - advise client – though there may not be an impact on the purchaser, e.g. statutory building scheme, heritage designations, etc.

7. It is not enough to just look at the search – s.23(2) – you have indefeasible title, subject to…a number of exceptions to the concept that what you see in the LTO is conclusive. Many things can give person acquiring interest LESS than they think they are getting (s.23(2)).

Why would you need to do this?1. To know what kinds of restrictions there are the land2. To know you are dealing with person who has right to pass on interest.3. To know encumbrances on land (particularly financial ones)4. Bottom line – is what you think you’re getting, what you are getting?

s.23(3) & (4) – Indefeasibility and Adverse Possession

Canadian Pacific Railway (2002): Ss 23(3),(4) make it possible to acquire title by adverse possession where no indefeasible title has been raised to the subject land, or where the claimant is challenging the first indefeasible title registered. Acquisition of title by adverse possession can arise both through mutual mistake and where the adverse claimant is a knowing trespasser. For a claim to title based on possession to succeed, the act of possession must be open and notorious, adverse (not with the permission of the owner), exclusive, peaceful (not by force), in general actual (as opposed to constructive) and continuous.For 110 years, CPR trains have run through alley - CPR is the registered owner in fee simple of most of the land over which these trains run – but for a 0.52 mile stretch of that land, there was no indefeasible title in the LTO in CPR’s or any other person’s name - CPR applied under the Land Title Inquiry Act for judicial investigation of title and eventual declaration of title with respect to this piece of land. Its claim is based on its long, uncontested use of the property. Note: This petition was allowable because the claim existed prior to 1975 when adverse possession was statute barred, but also because the land had never been registered, which triggered s.23(4).Note: CL doctrine of adverse possession flows from limitation statutes that where a party has had the intention to possess property and has in fact possessed it for the period of time stipulated in the limitation statute, effectively excluding the true owner, the true owner is barred from bringing an action to recover land.Note: Under s.8 of the Land Act, you can’t acquire title to Crown land by adverse possession.Note: The Land Title Act is very clear that in order for a claim to adverse possession to be successful, an order must first be obtained under the Land Title Inquiry Act. Because of s.34, part of the judge’s order must confirm that good, safe, marketable title is obtained.

STATUTORY EXCEPTIONS under s.23(2):

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Carr v. Rayward (1955): A mechanics (builders) lien can be effective against lands if not filed in land registry office until after owner for whom the work was done and materials supplied has sold the lands and the purchaser has obtained a certificate of title from the land registry.Builders lien for work done registered against title AFTER sale of property by unknowing 3rd party. Was lien valid charge on ppty w/out notice being given to purchaser? Yes. LTA allows this type of lien to be registered AFTER sale.Note: Careful of this when conveyancing! Find out if any work done on property at about time of transaction. Under Builder’s Lien Statute: have at least 30 days after work done to file. Always run risk lien may be filed in future.

Winrob v. Street (1959): A solicitor does not have a duty to ascertain the dimensions of the lot their client is purchasing. [Boundaries Exception Example].P signed K to buy house – D law firm searched title, but did not search any maps or plans in the LTO to determine the dimensions of the property. P discovered that a portion of what they thought was their lot was actually owned by the City of Vancouver. P sued D in negligence. Court: Lawyers are not surveyors!Analysis: To determine whether or not a solicitor has a duty to do something: evidence of general/approved practice relevant and may establish a defense, but if it is established that such general and approved practice is inconsistent with

provident precautions against a known risk then the mere fact that it is usual and long established is not a sufficient justification.

Exceptions Under LTA s.23(2) :a. Exceptions/reservations in the original Crown Lands (s.50 Land Act) – gold,

oil/gas, bed of stream, etc.b. A federal or provincial tax, rate or assessment (any outstanding are paid out of the

proceeds of the sale) e.g. Income Tax Act, Workers Compensation Act, if a talent agency, lien on property. These statutes allow gov’t agencies to claim upaid taxes/wages even though they are not registered.

c. Property taxes – municipal charges/rates (including water, sewer, garbage).d. A lease agreement for term < 3 years, if there is actual occupation. e. Highway or public right of way, watercourse, right of water or other public

easement – if public money is spent on a road not formally dedicated a highway, it is deemed a public highway

f. Expropriation Act allows government (for compensation) to take some of your land, or escheat (no compensation - reverts to the Crown). The fact that your land may be subject to expropriation may not appear on title.

g. Caution, caveat, etc endorsed on the title, or that may be noted or endorsed after the date of the registration of the title: noted or not – e.g. agricultural land commission notice which restricts the use of the land for farm purposes, this would appear on the title [Some appear as “Legal Notations” or “Charges.”]. Judgments, court proceedings, CPL are there.

h. Wrong descriptions or boundaries – no guarantee surveying is correct.i. If there is fraud – it may affect titlej. A restrictive condition, right of reverter, or obligation imposed on the land by the

Forest Act (tenures or agreements about the use of forest land) – forest legislation creates tenures – terms under which you can go on and log.

More Discussion on Fraud Exception

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s.23(2)(i) – Exception for the right of a person to show fraud including forgery in which (a) RO has participated in any degree, or (b) the person from or through whom the RO derived his/her right or title otherwise than in good faith and for value, has participated in any degree.

a. e.g. H is registered owner, W forges H’s signature and becomes new registered owner. H can recover title under s.23(2)(i)

b. e.g. H is the registered owner, W forges H’s signature and becomes the new registered owner. W sells to X, who knows of the forgery. H can recover title.

There is no statutory definition for fraud in the Act. False representation of a matter of fact, by words or by conduct, by false or

misleading allegations, or by concealing that which should have been disclosed, which is intended to deceive or does deceive another person who acts on it to his or her legal detriment. You must be able to prove fraud!

Gibbs v. Messer (1890): Registration in the fictitious name cannot impede the right of the true owner, who has been defrauded, to have her name restored to the register. Torrens system gives DEFERRED indefeasibility – became the law in BC. But if B transfers to C C gets good title!Mrs. Messer was entered in the register as proprietor of land. Her husband left the duplicate certificate of title and a power of attorney she had given him with their lawyer. The lawyer forged a transfer of the lands to a fictitious person. He then arranged with Ds, the McIntyres, for a loan to be secured by mortgage. The lawyer takes the money, however when the mortgage was presented for registration, the Registrar insists on a certified statement, which the lawyer forges, so that the mortgage can be registered. The lawyer leaves with the money, leaving no assets behind. Note: This case is considered the support the idea of deferred indefeasibility – while McIntyre doesn’t get good title, if he were to pass it on to another person for value, that person would get good title. This case goes against the LITERAL meaning of s.23(2)(i).Note: Registrar was joined to this action so that she could access AF if needed.

Frazer v. Walker (1947): The register is conclusive. Where a person acquires a registered interest it grants him title with respect to that interest which is immune from adverse claims other than those specifically stated in s.23(1). Torrens system gives immediate indefeasibility.Mrs. Frazer arranged a mortgage with the 2nd respondents, without the knowledge of Mr. Frazer. This money was used to pay out the 1st mortgage on the property, and the remainder to Mrs. Frazer. When no payment was made on the new mortgage, the mortgagees exercised their power for sale, and had the property sold at auction to the 1st

respondent. The 1st respondent subsequently applied for possession of the property, relying on his title as registered proprietor. Mr. Frazer claimed that his signature on the mortgage was forged and that the mortgage and sale had occurred without his knowledge. He claimed a declaration that his interest in the land was not affected by the mortgage or by the sale. He applied for a declaration that the mortgage was invalid and that the register should be restored. The court did not agree.Note: Even although the 2nd respondent entered into a fraudulent agreement, he did so in good faith and for value, so he had an interest that was equally as legitimate as appellant’s. This case was distinguished from Gibbs v. Messer which dealt with a bona fide purchaser for value of a fraudulent title from a fictitious party, whereas this case

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deals with an adverse claim made in good faith on a fraudulent instrument. If mortgage is valid, it follows that sale is also valid.Note: Registration once affected must attract the consequences which the Act attaches to registration whether that was regular or otherwise (i.e. it grants indefeasible title). It is registration and not its antecedents which vests title.Note: If this case followed Gibbs v. Messer, the mortgage would not be valid, but Walker will still get good title.Note: The literal meaning of s.23(2) if you haven’t participated in fraud and you take for value, you get indefeasible title.

The Torrens system has three principles: Mirror principle: what you see on the title is a complete and accurate reflection of all

interests affecting the land [exceptions in s.20, 23(2) s.29]. Assurance principle: if there is mistake you get compensation from AF. Curtain principle: the curtain drops behind the certificate of title, and you don’t need

to investigate the history of the title. It is the registration which vests and divests title.

From a policy perspective, who bears the risk of a forged document? The first purchaser. The AF will come into play if the property is subsequently sold, because that purchaser takes for value, not under a forged document. [[EXAMPLE: Limited to Fee Simple and Charges. Assume K is owner of Lot A. There is transfer (Form A) to B then to C then to D. If we are looking for moment in which curtain comes down and indefeasible title arises, when does curtain come down? Once B becomes registered owner, does he have immediate indefeasibility? If Form A is forged and B gets on title and B is bona fide purchaser and don’t participate in forgery, the real owner K is out of luck. Note: K could sue under AF. B does not have good title but when B transfers to C, C gets good title.]]

[[EXAMPLE: K owns Lot A which is vacant. B buys the lot based on forgery and begins to build house. B is bona fide purchaser – knows nothing of forgery. One day K sees house going up on land, and does not recall contract that doesn’t exist! B has paid the rogue person who left the country. Analyze: What is position at common law? Forged Form A has no effect at CL B would get nothing. Why? Nemo dat can give what you don’t have). Purchaser bears risk at CL of forged document. B could have checked title, K had no way to prevent/know. Now with s.23(2) you have to look at it in two points in time: prior to November 2005 and after. The plain meaning of s.23(2) before Nov 2005 is that B (who comes onto register) and does not participate in fraud gets good title.

Amendments to statute 2005: Immediate has been brought back: Gibbs says BC has deferred indefeasibility – later, legislation tries to bring back to BC immediate indefeasibility but only with regard to fee simple interests, not charges s.25(1). Before the amendments: if B came on title and was not involved in fraud then he would get indefeasible title. 2005 Amendments did 4 things:

1. Added words in 23(2) “as registered owner.” So this is referring to fee simple and not charges. Split system in BC: immediate fee simple; deferred charges.

2. S.23(2)(i): Seeking to limit application of the immediate indefeasibility to registered owners.

3. Added a new section 25.1: “subject to this section a person who purports to acquire land or estate by registration of void document does NOT acquire. Back to CL you can’t take land based on a void document. S. 25.2(2)(3): purchaser

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deemed to get fee simple even if Form A forged. What happens: K shows a close link over many years to family lot they lost lot to B on basis of forged Form A. It is deemed B gets indefeasible title. Maybe B had some inkling there was something wrong. Judges may go OUT OF their way to find a way for K to keep an interest based on 25.1(2)(b) “in good faith and for valuable consideration…is deemed to acquire…” K can apply to AF! But there is an opening here. How to protect yourself? Get Duplicate and put it in safety deposit box!

4. S.297(3) deleted. Used to support argument that we have deferred indefeasibility in BC. So as far as fee simples, we are back to CL immediate indefeasibility. As far as charges, we have deferred.

[KA]. If forged Form A…A wins. If forged mortgage…A loses.

NOTICE of Unregistered InterestsLegal notification required by law: requirement that a party be aware of legal process affecting their rights, obligations or duties. Vital principle of fairness and due process in a legal procedure.Actual notice: a real knowledge of the circumstances; constructive notice: facts or circumstances that ought to have been appreciated or understood.

s.29.2: If you get registered and know about unregistered interest (you have notice) you are safe because you are not caught by unregistered interests. Objective to abolish CL rule about effect of notice: if you acquire interest but effect of acquiring it is to defeat someone else’s interest, you are subject to their interest. “Except in case of fraud which he or she has participated…”

The idea of LTA, particularly s.29, was to rule out equitable doctrine of notice which states: “a person with knowledge of a prior equitable interest takes subject to that interest”. Problem: courts have shown tendency to go beyond the words of the statute and apply some doctrine of notice by equating notice to fraud.

s.29(2): You don’t have to pay attention to unregistered interests. Courts are saying you can’t rely on the literal meaning of s.29(2). How far will the courts go to require persons who would fit within the literal meaning of s.29(2) to take subject to unregistered interests, i.e. when is notice fraud? There are three questions that are important:

The time of the notice – when do you learn of unregistered interest? o Before K of purchase and sale is signedo Before completion (all the documentation has been completed with

respect to the transfer, but registration has not yet occurred)o Before registration

Is it actual notice (you see the lease document), or constructive notice (that you see someone renting the building) of the interest?

Is mere notice of the unregistered interest enough to constitute fraud, or is it notice together with something else? Willful blindness is no excuse.

[CL Example: If A acquires fee simple from B. If at time of purchase, A is aware C has interest in the land. Can A acquire fee simple in priority to the interest C has? CL said ‘no.’ If B in dealing with A is unjustly trying to defeat Cs interest, that is fraud by B, A is aware of it and A’s title is tainted – no priority. A can acquire only subject to C’s interest.]

When do you begin to acquire interest in the property?1. K of purchase : vendor gets equitable interest (at CL).

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2. Completion : paid purchase price and received documents to transfer the interest. Legal interest passes to purchaser (at CL).

3. But now with Torrens system, critical point in time is registration (s.20).

What notice might bring you within the opening words of 29(2)?1. The timing of the notice : when does the person who is acquiring

interest get notice of possible competing interest? If you analyze cases, the time that counts is before the K of purchase and sale.

2. Must you have actual knowledge or constructive knowledge ? Actual.

3. Is notice of the unregistered interest alone enough to constitute fraud or must you have notice together with something else? see Szabo.

Szabo v. Janeil (2006): In order to make unregistered easement binding on subsequent purchaser, owner must show new owner had actual knowledge of it before purchase plus an element of dishonesty.Szabo lives on Lot A – eventually has dealings with Duncan who owns Lot B – Duncan sells Lot B to Hanson – Hanson now owns Lot B – while Duncan owns Lot B there are discussions with Szabo of an easement – this easement does not get registered.

Issue: Does Hanson take Lot B subject to unregistered easement? On plain reading of s.29 you would say “no” – he is not bound by easement because even if there was notice it would not be sufficient and also because between Hanson and Szabo there is no privity. In order to make easement binding on subsequent purchaser Szabo has to show Hanson had (a) actual knowledge of it; (b) when Hanson got the notice. The judgment said he had notice at time of purchase (but does that mean K or reg or what?) not a strong case on timing. Court: timing is OK, actual notice is present, then goes on to consider what in addition to actual notice of the unregistered easement do you have to have? Hanson knew Duncan and Szabo had been talking and his lawyer said no easement (reg or unreg) had existed. Court canvasses differing views over time whether notice alone is enough – “mere knowledge will not in and of itself will not produce element of fraud – there must be element of dishonesty.” If you have knowledge how much due diligence do you have to engage in – is it enough to ask your lawyer? If your suspicions are aroused, did purchaser do all that was appropriate in the circumstances – courts do not want to impose to high a duty on purchasers as it would frustrate purpose of s.29 – to relieve them! Court: there was not knowledge plus element of dishonesty.

Notice: time must before K of purchase and sale; you must have actual notice; it is notice plus element of dishonesty.

*Exam: getting rid of unregistered interest and your views on it.

“IN PERSONAM” CLAIMS

B enters into agreement with respect to interest in land with A. A becomes RO. B alleges breach. Can A say, “Sorry, I got registered you are out of luck.” Courts say agreement between them is not extinguished because A gets registered. B may still have monetary claim against him (A keeps property, however). A cannot rely on the indefeasibility of title which he or she has obtained to defeat rights in personam which he or she has created, or subject to which the interest has been taken, if the right is one the courts will enforce. Registration does not give immunity from contractual claims.

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Pacific Savings and Mortgage v. Can-Corp (1982): When provisions of the LTA are read as a whole, (ss. 23 and 25) cannot be read as bestowing conclusive indefeasible title on RO; i.e. ss. 23 and 25 are for protection of 3rd party purchasers for value, not registered owner who acquires title through foreclosure. Issuance of certificate of title to mortgagees is not a bar to a motion to reopen a mortgage.Mortgager gave mortgage in exchange for cash – arrears – tried to foreclose – property sold to third party. Note: To prevent property from passing to a bona fide purchaser for value without notice, a mortgagor should register a lis pendens on title.

McRae v. McRae Estate: If property reaches hands of someone who knows of existence of rust, that person is bound by the terms of that trust. When B becomes RO of A’s land, any in personam claim A has against B is not extinguished by registration (where B is not a bona fide purchaser for value without notice). RO good against world except A!FF willed ppty to wife in trust, for herself for life, & remainder to their 3 children – she became RO w/ “on trust” notation on title – In 1949 transferred property to one son who became RO w/o indication of trust – Died in 1989 leaving property to wife & kids. When brothers and sisters learned terms of dad’s will, brought action. TJ set aside transfer to son & returned property to executor of Mrs. Fraser to be disposed of according to law.

B. REGISTRATION: CHARGES.

Charges = estate/interest in land, less than fee simple - includes encumbrances. s.197 – deals with the registration requirements of charges : Form B (mortgage),

Form C (other charges). s.180 – recognition of trust estates (requirements for registration – trust

document number must be noted to title, but the particulars of the trust will not appear). Trusts can be noted on RO. (In Trust DD). Owner of fee simple has “legal fee simple”; beneficiaries of trust have equitable interest.

s.180(7) – interests affecting the land cannot be registered if prohibited under the trust document or will (e.g. if the will forbids a mortgage, the trustee cannot later register one as it would be directly in conflict with the particulars of the will or trust document)

Dukart v. Surrey District (1978): Where you have the right to go over the foreshore reserves in order to access the water may be subject of an easement. A trust that creates an easement and is registered in accordance with the provisions of LTA will survive a tax sale, despite easement being registered as a trust and not as a charge.A deed to properties contained easement to wander the foreshore lots to gain access to Boundary Bay. The title to the “foreshore reserves” was then transferred to a trustee to hold for the benefit of the purchasers of lots. This trust deed noted that the trust was to be in accordance with the previous mentioned deeds. The trustee became RO. A new trustee was later appointed by the courts, however, the easement was never registered as a charge against the servient tenement. D acquired title to foreshore lots in a tax sale and tried to build a "washroom" on foreshore. P seeks injunction to stop construction. D, as is the normal course in a tax sale, acquired land free of all charges except "any easements registered.” P argues the trust created valid easement and survived tax sale. The court agreed.

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INDEFEASIBILITY OF A CHARGE In connection with charges, we don’t see the same clear language as s.23 s.26 doesn’t talk about indefeasibility, rather only that the charge gives an

interest, but it is subject to the s.23(2) exceptions. s.26(2): the mere fact of registration says nothing about charge’s validity. s.27: if you get charge registered, that is in effect giving notice to the world of

your claim. A person cannot say “I didn’t know about it.” 27(2): making payments on a mortgage is not a dealing on land.

Three ways trusts are dealt with 180(1,2,3): If someone holds land in trust they appear (trustee) as registered

owner. Or under RO of charge section: “xx, in trust” – rare but usually with regard to

mineral rights for commercial purposes. Dukart: sometimes charges not reported in normal way.

[[Example: A (RO) B forges A’s mortgage to C B forges A’s Form A to DD mortgage E

Who is registered owner on title? D(RO) What charges are on register? #1 C mortgage #2 E mortgage

[[Does D have fee simple? Yes, because fee simple is immediate indefeasibility. Who loses out? A can go to AF. What about Cs mortgage? It is invalid because it is deferred indefeasibility. What about E’s mortgage? There is nothing wrong with it. C’s mortgage is not valid, so E moves into #1 spot.]]

Cr é dit Foncier v. Bennett (1963) : s. 26, LTA: “RO of a charge shall be deemed to be entitled to the estate or interest in respect of which he is registered” as opposed to s. 23: “[fee simple] is conclusive evidence in law and equity...” The word “deemed” only creates a rebuttable presumption. Example of reasoning that: maybe these amendments in 2005 do not give conclusive title to Fee Simple owner which they tried to do. Forged mortgages are a nullity.A mortgage was forged outright and registered against Ds property – mortgage then assigned to P. P (having checked that the mortgage was registered) sued D, on default, who was unaware of the forged mortgage. The court did not agree D not held liable for mortgage. Presumption rebutted: mortgage was “a nullity by virtue of forgery and remained a nullity nothwithstanding registration.”Note: D rebutted the presumption, as the mortgagor did not verify the "state of accounts" with D as required by s. 27(3).Note: An assignee of an interest can never take better than what the assignor had (not new charges).

Can Commercial Bank v. Island (1988): A 3rd party who acquires an interest bona fide for value from RO is not affected by a fraudulent discharge of another interest. A mortgagee must be able to rely on the LT System.

Issue: What is effect of forged discharge?Park Meadow (RO) Imperial got first mortgage Island Realty got 2nd mortgage. Almont got 3rd mortgage At time Almont got 3rd mortgage, they wanted a 2nd. The 2nd

was discharged (but was a forgery) – it had been registered and disappeared. Once

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Almont saw it disappeared, they paid it out. What is effect of a forged discharge? Registration of it has no effect. But Court held in this case, that Almont’s mortgage was a new mortgage and does move up into 2nd place. Even though it was an invalid discharge, Almont was not aware or a party to forgery and got good second mortgage.Fraudulent lawyer grants a mortgage to the defendant against his company’s property. D then registers the mortgage. The lawyer grants second mortgage to P. The lawyer registers a fraudulent discharge of the defendant’s mortgage and P registers its mortgage. Lawyer skips town and his company goes bankrupt without enough money to pay both mortgages. P sues to get funds in bankruptcy despite discharge of the mortgage.

Contrast these two cases: CCB got their interest directly from RO – they did not take the interest through

the fraudulent transaction, their interest was just enhanced by the fraud, i.e. it did not affect the validity of their interest.

Credit Foncier got their interest through assignments of the interest, which turned out to be fraudulent, i.e. their interest was fraudulent, so invalid.

PRIORITIES:s.28: unless charges provide otherwise, the date of registration sets date of priority (not date charges signed). Lawyers often called upon to negotiate priority.

Summary of indefeasibility Is it in relation to fee simple (immediate) or a charge (defers)? s.23 – declaration of indefeasibility & exceptions to indefeasibility s.29 – abolition of equitable doctrine of notice, tending to strengthen

indefeasibility of title s.25 – an action of ejectment or other action for the recovery of land, must not be

maintained against the registered owner except for o in a foreclosure, o a lessor as against a lessee in default, o a person deprived of land by forgery etc

s.297 – “Protection of a purchaser in good faith and for value” (no purchaser is subject to a proceeding if they are RO).

CHAPTER 7: Failure to Register.

A. GENERAL PRINCIPLE: s.20: Without opening words, appears to say that until you have registration, you have no passing of ownership in an interest. At what point in time does interest pass? Over time, the point has changed when interest passes. There are legal and equitable interests.

Torrens: s.185(1) prescribed form required (Form A). s.20: Transfer of interest does not pass until instrument registered. But it is not that simple!

Sorenson v. Young (1920): Illustrates s. 20 applying literally – does not involve application of opening words “except as person making it.” P owned Lot 1 and Lot 2 – P sold Lot 1 to Roche – but the sale was expressed to be “save and except a right of way over Lot 1 in favor of P.” Right of way not registered. R

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sells to Defendant who becomes RO of Lot 1 – D lets P continue to use right of way – eventually don’t get along – new owner fences off the right of way. Is D bound by unregistered right of way. Court applies s.20 and says no.

Feinstein v. Ashford (2005 BCSC): Illustrates s.20 is still the law.

B. EXCEPTIONS: “EXCEPT AGAINST PERSON MAKING IT” These words expressly make operative an unregistered instrument against the

party making the same.

Stonehouse v. BC (1962): An unregistered document becomes operative and severs JT. You can dispose of your interest with unregistered Form A.Husband and wife were joint tenants – wife transferred her interest to her daughter – but there was no reg – wife and daughter sat on Form A until wife died – daughter comes out and registers Form A (that is legal). But when did Form A take effect? Court: in BC “except as against person making it” – make operative an unregistered document against person who made it. As against the wife, this was operative, despite s.20 – was effective against wife and daughter.

(Judgments) - Yeulet v. Matthews (1982): If an earlier, unregistered interest is found to be bona fide and validly executed, it is entitled priority over registered interest. A judgment creditor cannot obtain any more rights than judgment debtor. “A creditor can only attach that interest which exists in the execution debtor.”Mrs. Matthews held, from her son, an equitable mortgage by deposit of duplicate certificates of title. After it came into existence, P registered a judgment against the son and obtains an order to sell property. It is conceded that if Mrs. Matthews held a registerable interest she would have priority. P seeks to claim priority over Mrs. Matthews’ unregistered interest. Held: Unregistered equitable mortgage and charge of Ms. Matthews has priority over judgment.

Martin Commercial v. Virtanen (1997): Illustrates law in Court Order Enforcement Act 86(3)(c): “Lien and charge of judgment creditor are subject to the rights of purchaser, who, prior to registration of judgment, has acquired interest in land in good faith.”RO agrees to sell property. Judgment creditor registered against vendor’s interest (Oct 25) – on Nov 6, original deal completed – purchaser registered interest – creditor’s interest not yet on register. The judgment is not valid as against the new owners.

L & C Lumber v. Lungdren (1942): Selling or standing timber and right of entry is interest in land and contractual right. Even unregistered interest of this nature stands up against subsequent purchasers. Applies s.20 to another kind of interest.Lungdren sold timber and right of entry to McD – McD assigns their rights to L&C and gave notice to Lungdren – no registration – L&C has right to log and logs – Lundgren says no – L&C wins.Note: LTA s.20(1) “Except against the person making it,” clause applies. L & C are assignees, thus have the same rights as original purchasers.Note: Right to log was deemed an interest in land, not an in personam right.

PROHIBITED TRANSACTIONS

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International Paper v. Topline (1996): Illustration of unintended consequences when you avoid registration. A lease for more than 3 years cannot be made as a license, in an attempt to get around zoning laws – it must be in compliance with LTA. Topline is landlord and RO - IP leased land for more than 3 years, but was not registered - The two parties had developed poor relations and Topline was desperate to have Int’l Paper removed from lease - Topline refused to renew lease on expiry - IP claimed that it was a “renewable lease” and sought court enforcement - Topline claimed the lease was illegal in the first place because it contravened s.73 of LTA (No person shall subdivide land for purpose of agreeing to lease it unless it complies with subdivision rules…). The court agreed. There never was a lease.Note: s.73.1 – does not apply to subdivision for purpose of leasing building or part of building. s.73.1: “A lease or agreement for lease of part of a parcel of land is not unenforceable between the parties to the lease or agreement for lease by reason only that (a) the lease or agreement for lease does not comply with this part; or (b) an application for registration of the lease or agreement for lease may be refused or rejected.” s.73: (May 2007). Even if you don’t comply with s.73: Topline says it is void. s.73.1 – as between the parties of agreement, it is still enforceable. Legislation corrected Topline. Note: 73.1 does not say it is retroactive – there are no cases indicating whether it is or not. s.73(3): subsection 1 does not apply for purpose of leasing a building or part of a building. If you talk about building only, you don’t run afoul of s.73. If your client purchases business that has 10 year lease in mall: potential problem is sale – what happens if landlord sells the mall? If the lease is not registered, you might be protected by cases addressing notice, but it is a potential problem. Note: if new landlord takes payment for lease, he can’t then turn around and say “get out, there is no lease.”

CHAPTER 8: Applications to Register.

What happens when registration is underway and a caveat or CPL (lis pendens) arrives on the scene?

s.20: in order to have a creation of an interest become effective, you must have it registered (except as person making it).s.22: date of registration is key, not day mortgage is signed. s.154: person acquiring fee simple must register acquisition of their interest by applying to Registrar.s.155: if you have transaction for purchase of land; in addition to purchase, if you are financing it (mortgage) you must register the mortgage next (Form B). Other charges require the Form C. There is a sequence in which documents are presented for registration. Form A must be put in first.

(1) Make sure documents are in order: Form A Transferor RO(2) Submit documents for registration (hard copy or electronic). Registrar must write or stamp on each application the date/hour of its receipt, a serial number (s.153). Stamping is basis for priority (s.28). (3) LTO examines documents: must have proper legal description; safe marketable title in fee simple (s.169(1)). Stamping, accepting charges. Must check who has right to grant this charge.

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Before registration is completed, another charge can be registered. In time gap between pending acceptance and acceptance: what happens if something gets registered in time gap? What two charges are most challenging if registered in the gap? (a) CPL or Lis Pendens – somebody has started a lawsuit in which they are claiming an interest in the land. Court gives you a CPL and you run down the street and file it in LTO; (b) Caveat: Registrar’s Caveats are filed by registrars of titles themselves. Other caveats (individuals’ in 286-8) eg: purchaser saying I have equitable interest and want to protect it (I think vendor sold to someone else). Effect? On receipt, registrar must make endorsement on it and send copy to RO. Registrar cannot register anything against land unless it is expressed to be subject to claim of caveator. During this gap, if registrar finds something wrong, they can reject it. Getting pending # is no guarantee you are going to registration. Because of gap between pending and final, there is a risk that what you think you are getting when registering Form A is not exact.

s.155(1): “Application pending.”

s.282 – Caveat: a person claiming under an unregistered interest which is incapable of immediate registration (e.g. K of purchase and sale), or entitled by operation of law (e.g. proprietary estoppel or an UE constructed trust document).

s.31 – if a caveat has been lodged, or CPL has been registered, if the caveator or Ps claim is subsequently established by judgment or order or admitted by an instrument, it is entitled to claim priority over other applications made after the date of the lodging of the caveat or CPL (lets you ‘get in line’ while you perfect your interest). They either lead to a more substantial interest or they expire.

s.288 – Effect of caveat: as long as it is in force, the registrar must not register another instrument; unless it is expressed to be subject to the claim of caveator.

s.216 – the effect of a CPL: similar to the caveat, in that you can register subsequent interests, but they must be subject to the eventual termination of the lawsuit in respect of which the CPL has been filed.

Peck v. Sun Life (1904): The act of registration itself affects notice. Despite filing of CPL fee simple went to final because purchaser did not know of adverse application.

Issue: Whether registration of fee simple could go to final after CPL was filed in the gap. Was P supposed to continuously check register for newly registered interest until he completed payments? P entered into agreement to purchase land from Mrs. Elliot - agreement that he was to make monthly payments until the agreed purchase price was paid in full, at which time the land would be conveyed - sometime before the payments were fulfilled D registered a lis pendens against Mrs. Elliot - question was whether P had to pay off the amount of the lis pendens charge before he could register his title indefeasibly. At issue was whether registration of lis pendens imputed notice to prospective buyer.Court: despite filing of CPL, the fee simple went to final. Purchaser took clear of it because he didn’t know of adverse application.

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Note: The court held the CPL does not affect the transfer, “the doctrine of lis pendens is merely an application of the maxim of forensic policy that a litigant policy is not permitted to defeat the rights or delay the proceedings of their enemy. The theory is to freeze title, so that people don’t dispose of their interests in the act of litigation. BUT, that doesn’t catch persons who acquire interests before the litigation begins. It is not a foregone conclusion that simply because the CPL intervenes that in the end the CPL will get priority over the registration that occurs after. You are merely on notice that you are at risk. The filing is no determination that you necessarily will be affected by the interest (i.e. just the fact that it gets registered doesn’t mean it is automatically a valid interest).Note: Money he owed Elliot went to SunLife.

Rudland v. Romilly (1958): You can’t have delays due to the administration of LTO affecting your right to title. In the absence of fraud, you can equate a clear right to registration, to registration itself where the person claiming the right is a bona fide purchaser for value; the right has been acquired and registration applied for prior to filing of lis pendens; such a purchaser is not party to the litigation. Any notice coming after completed transaction application to register does not affect registration as legitimate notice as long as purchaser was bona fide & without notice.Transfer of fee simple interest – CPL intervened – did person get their interest? Yes they did. What must you fulfill in order to get it? Nov 21/55 – the defendant Romilly conveyed lands to Lindsay. Dec 14 – Lindsay submits application made for registration of deed. Dec 16 – Lindsay conveys land to Rudland. Rudland gives Lindsay $1000, Lindsay

will give property to Rudland if sum not paid by 23 Dec. Dec 29 – certificate of title, free of charges, is granted to Lindsay. On the same day

application made by Rudland for registration of title (from Lindsay). Jan 16 – defendant Romilly applies for lis pendens against the title pending

allegations of fraud against Lindsay. Registrar refuses to grant title to Rudland until litigation is resolved.

At issue is whether or not P has interest in land upon filing the application [prior to lodging of CPL]. The court found for P.Found: Although a person contracting with RO may not acquire indefeasible title until registered, he is protected by statutory provision abrogating the doctrine of notice upon application for registration.*Despite cases, registrar took matters into their own hands: we are not going to let them go to final because it is inconsistent with principle of indefeasibility. When we know there is challenge to the title, we cannot come to conclusion that there is good title. For them, filing CPL freezes title.

*Legislative response: s.216 – CPL freezes activity BUT s.217 despite 216 the registrar may complete registration of indefeasible title or charge that was applied for before CPL was made. Applicant gets interest, but if they lose in litigation they lose their interest. If CPL relates to certain proceedings (foreclosure; Family Relations Act; Wills Variation Act) (2172c), they take title subject to CPL whether or not party is prior applicant to proceedings.

Canada Permanent v. BC Registrar (1966): While the lis pendens is notice that affects the transfer of the deed, the mortgagee is a bona fide purchaser for value without notice of the action. Therefore where a lis pendens is registered after the granting of a mortgage in these circumstances it cannot be denied registration.

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Owner transferred property by deed to purchaser. Purchaser granted mtge on ppty before registration, then applied to have transfer registered. Next day, the mortgage presented for registration. Previous owner then filed LP, trying to get purchase rescinded on basis of purchaser’s fraud. Registrar refused to register mortgage. The registrar refused to complete the registration of the mortgage. CP appealed the registrar’s decision. The court agreed with them – registration of mortgage ordered.

Land Title Act provisions:s.155 – any subsequent charges must await registration of the fee simple.s.198 – an instrument which creates a charge on land must not be registered unless the person has first been registered as owner of the fee simple.

Canada Permanent, Rudland and Peck were not decided by considering these sections (for some strange reason) so it is likely that it would not be decided as above, making reference to them.Note: This is again the issue as in Frazer and where the “curtain” falls.

Summary If you acquire an interest with similar fact pattern of Rudland and Canada

Permanent then you likely get title free of lis pendens. It does generally support the idea that you acquire rights before registration,

which is to some extent at variance with s.20 of the LTA. There is a gap in time, between receipt of application and final registration That raises the issue of registrations which get lodged in the gap s.153(1) of LTA: it is the time of registration which becomes the basis for priority. s.28 refers to priority based on the date and time of registration s.168 there is a possibility created under the statute for ‘queue jumping’ because

LP and caveats which can get in the gap and which despite the fact by time alone, they are farther down queue, they may get to jump ahead – however, case law shows that this does not ALWAYS happen.

Practical implications as lawyers If you are doing a real estate transaction, do you pay out on a pending number,

or do you wait for final when things MIGHT come through in the gap? The profession has taken the position that you do, and you take the risk, in order to meet the commercial realities of the transactions – it works smoothly if you assume that the registrations are instantaneous.

Lawyers exchange undertakings (promises to do certain things) if you fail to keep that promise, you can lose your license to practice. Be sure to qualify your promise if there is a possibility of something intervening and you can’t complete the transaction.

CHAPTER 9: The Fee Simple.

Feudal system – Crown owner of all land. Two concepts of ownership: (a) Tenure - conditions under which tenant would hold the land (knight service, free and common socage); (b) Estates: length of time interests in land held; (i) freehold estates and (ii) leasehold estates.

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Freehold estates Leasehold estatesIndefinite, uncertain (almost forever) time period

Certain, ascertainable, limited time period

Owner Seized of the land In possession of the land

Freehold estates Fee simple – “fee” an interest of inheritance (can be passed to somebody else);

“simple” there is a large (unlimited) range of heirs contemplated by law – category of persons who can inherit. As it was used historically, “heir” means one who inherits. Someone who receives land by an act of the testator, by will, or by statute (intestacy). Result: the interest continues after death of original holder. If no “heir,” or if company owner is dissolved, escheats to Crown.

Life estate – duration is limited to life of someone.

Leasehold estateso Duration: defined time period (limited). o Rights owner has versus rights of tenant. What is in common: possessory rights.

When owner gives up possession to tenant, he still has possessory rights – they have not parted with them for all time – can get it back. Owner retains right of coming in (inspection).

How do fee simples get created? CL – you needed to say “to A (transferee) and his/her heirs”.

o To A – describes recipient of interest and is referred to as words of purchase.

o And his/her heirs – this describes duration of interest and are words of limitation. This DOES NOT give any interest to the heirs, it just stipulates the nature of the assignment to the transferee. They are NOT words of purchase.

Words of purchase – describes the recipient of the interest.

Tottrup v. Ottewell Estate (1969): Words of limitation are no longer necessary to convey fee simple ownership, although their inclusion should not infer a separate meaning was intended. A will should always be interpreted first on the words used - if they are clear, subsequent circumstances cannot alter their meaning. Never use words that you aren’t sure of meaning.Frank wrote will and left majority of his estate to his brother Fred: “I give, devise and bequeath unto my brother… to hold unto him, his heirs, executors and administrators absolutely and forever.” Fred predeceases Frank. Upon Frank’s death there is a dispute as to what the words of the latter clause mean. Fred’s daughter claims they are words of substitution (so she can inherit) not words of limitation. The court did not agree.Note: All the words say is that Fred would get property as a fee simple interest; it has nothing to do with whether or not Fred’s heirs have any right to the property.Dissent (CA): There is a presumption against intestacy and in construing the will it is the clear duty of the court to determine what the testator meant by words he used in their ordinary sense. Note: In Canada, court entitled to look at surrounding circumstances in construing will.

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Doctrine of Lapse: you must be alive to take a gift. If a specific gift lapses, it goes into residue. If residue lapses, the will goes intestate.

Property Law Act: 19(1): In transfer of estate in fee simple it is sufficient to use words “in fee simple”

without the words “and his heirs.” 19(2): Transfer without words limiting interest passes fee simple or greatest

estate in the land it has power to transfer. The greatest estate you have is what goes.

Land Title Act: 186(4): A transfer of freehold estate in prescribed form that is completed in

prescribed manner, operates to transfer the freehold estate to transferee whether or not it contains express words of transfer.

186(5): If transfer does not contain express words of limitation, default provision = fee simple.

Wills Act: s.24: If there is not contrary intention in will, if real property devised to person

without words of limitation, the device passes fee simple. Do not need to use words “and his heirs.”

If you say “I give Blackacre to my daughter Joan,” she gets fee simple. s.22: If you say “I give Blackacre to Joan” – that includes any interest you have.

If you have leasehold interest, that also goes to her.

PROBLEMS OF INTERPRETATION – REPUGANCY Inconsistency of clauses in one or more document. Often arise when grantor attaches a condition to the grant which is inconsistent

with an outright grant. “I give to Blackacre George, and when he dies, he must give it to Mary” inconsistent.

A gift can fall into two classes: first gift if fee simple, prevails and “gift over” fails as repugnant first gift is life estate only, prevails and the “gift over” prevails

Re Walker (1925): You cannot give a fee simple and attempt to impose restrictions or conditions. [If you want to do that, give them a life estate.] Will gave land to widow with qualification: “should any portion of the estate remain in the hands of my wife at the time of her decease, indisposed of by her, such a remainder will be divided as follows...” The widow had a will of her own, which granted everything to her heirs upon her death. The wife’s heirs want the will interpreted so that she gets fee simple, but the husband’s heirs want the wife to have a life interest, so that they can take on her death. Court ruled that wife got fee simple, as to allow the control of remainder was repugnant to first gift.

Re Shamas (1967): In construing wills, entire document and relevant surrounding circumstances are looked at to determine interest intended to be granted.Testator’s will says: “All goes to wife until the last one comes to the age of 21...” The wife works in family business for the rest of her life under the assumption that everything is hers. The children seek direction on what interests in the estate are taken by his widow and his children. Court found will created life estate only.

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Note: The husband left his estate to his wife and 8 children, but needed family business to keep running so that his wife could support the children; therefore, the court ruled that the wife gets a life estate with the ability to encroach as she sees fit to help the family and to help herself until after all the children reach 21, then the estate goes to the children. Is this an absolute gift to her, or something else? The court decided that, in the case of deeds, it is the form of the grant that establishes the interest conveyed. In construing wills, the entire document and the relevant surrounding circumstances are looked at to determine the interest intended to be granted.

Cielein v. Tressider (1987): Restraint conditions on otherwise absolute gift are void.Mr. Essen died and was survived by five children of a previous marriage and was common law with Mrs. Rich who had a son. He made a will leaving a property and all residue of the estate to Mrs. Rich. It also contained a note that upon the sale or disposal of the property, the proceeds were to be distributed between his five kids and her son. On an application for construction, the trial judge found that Mrs. Rich took a life estate and on her death the proceeds were to be divided equally between his and her children. The trial judge found that the will granted Mrs. Rich a life estate in the property. This appeal overturns that decision.

Re Huffman: Shamas is the leading authority; courts are construing the intention more LENIENTLY in recent times.

Words formerly creating a fee tail: Idea was to limit those who could inherit to your descendents, as opposed to fee simple where anyone can inherit. S.10 of Property Law Act abolishes fee tails. If you don’t use specific wording it goes into a life estate. Shelley Case: “To A for life, remainder to A’s heirs” in will. A got fee simple: (to A’s heirs) are words of limitation!

CHAPTER 10: The Life Estate.

Does not include the word “fee” which means it is not inheritable. Its duration is uncertain, but is limited to the lifetime of a person, either the life estate holder, or another person (pur autre vie) if my interest is life estate for life of my grandchild, and I die, the interest goes on.

A transfers “to B for life, and on his death to C in fee simple” C is “remainder”Remainder: “future interest arising in a third person.”

How do you create a life estate?1. By the act of someone – transfer of interest in a document (e.g. Form A, by ticking

life estate box, by a will, or trust). s.19(2) of Property Law Act - Default is that fee simple interest is transferred, unless you indicate a life estate. Wills Act s.24: unless otherwise stated, interest that passes is fee simple. Can use words “life estate” or “as long as they are alive.”

2. By operation of law – Nobody does a deliberate act here. Historically, they were created under CL and by statute.

a. CL doctrines : dower (for wife) and curtesy (for husband) - gave interest in land, notwithstanding that they are not on title. Ex: Right of life interest in

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portion of deceased husband’s land. Some juris (Sask) still have these doctrines -- BC doesn’t.

b. Statutes :i. Estate Administration Act s.96 – if your spouse dies intestate and

surviving spouse is not on title, they get a life estate in spousal home and all “household furnishings.”

ii. Land (Spouse Protection) Act s.4 – allows a spouse not on title to file application on the homestead’s property, which prevents disposition of the property without their consent. Gets registered against the title. Consequences of filing: (a) titled spouse cannot deal with land without other spouse’s consent (similar to dowry); (b) if owner dies, a life estate is created EVEN if RO has will. [Homestead = any land or interest in it entitling owner to possession of it that is registered of LTO in name of husband or wife; there is dwelling of husband or wife as residence for at least one year. Something which a person owns – land or interest in land to which you have right to possession – not necessary to be owner.] Not used very often. You can K out of it (prenup). Note: you can file without RO knowing, but LTO often sends out notice to RO!

iii. Wills Variation Act – allows spouses (broadly defined) and children (narrowly defined) to bring forward an action to set aside a will. Courts have created life estates in resolving a contested will. Note: courts can “custom draft” these life estates.

Life estate appears in charge section because in RO Section, only fee simple can appear.

1. Rights of life tenant :a. Occupation, use, profits - just as a fee simple owner, actual possession and

management of the property (including crops). Also get the right to remove fixtures during lifetime of LE holder or on death of LE holder. Chattels fixed to land (and become fixtures) can be removed by LE holder.

b. Transfer interest inter vivos – you can sell a life estate, but it is still tied to the life as dictated by the life estate.

c. Transfer on death – if life estate is tied to another person’s life, when the life estate holder dies and the other person is still alive, you can grant the interest by will.

2. Obligations of the life tenant :a. After the term of the life estate, the property should be given to the remainder

in substantially the same condition as when they were granted the life estate. The life tenant is a “steward” of the land. Doctrine of waste:

i. Permissive waste – neglect which permits decay, like allowing building to deteriorate. Not responsible: LT not responsible for repairs and maintenance (unless K says otherwise)

ii. Voluntary waste – commission or act that diminishes value of asset, like removing timber or minerals, demolishing buildings, or changing land use (eg: from agricultural to residential). Responsible.

iii. Equitable waste – severe and malicious destruction, s.11 of the Law and Equity Act. Responsible (often hard to distinguish from Voluntary).

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iv. Ameliorating waste – where you improve the land, changing the character of property. May be responsible: depends on the change made. If change increases burden on remainder person like adding maintenance cost, life tenant is responsible.

b. Pay the taxes, and therefore entitled to Home Owner Grant.c. No obligation to insure the property against losses (Verdonk). d. Responsible for current interest on a mortgage debt; if you pay some of the

principle, you may have a claim to get it back**e. For strata bylaws, life estate holder would qualify as an owner within the

bylaws. Some strata buildings say “no renters” – way around it.

** If there is $100K mortgage, with $1000 payments: When principle on mortgage is reduced, the remainder person is benefiting. It is not clear that principle is responsibility of LT.

Vane v. Lord Barnard (1716): An estate for life without impeachment for waste does not give tenant right to commit equitable waste.D settled castle on himself for life without impeachment of waste – ultimately his son to get property – got upset with his son – stripped the castle.Law and Equity Act s.11: Estate for life without impeachment for waste does not give tenant right to commit equitable waste this statute resulted from this case.

[Impeachment of Waste: signifies a restraint from committing waste upon lands or tenements; or a demand of compensation for waste done by a tenant who has but a particular estate in the land granted, and, therefore, no right to commit waste. All tenants for life are liable to be impeached for waste, unless they hold without impeachment of waste; in the latter case, they may commit waste without being questioned, or any demand for compensation for the waste done.]

New Westminster v. Kennedy (1918): Used doctrine of equitable waste to restrain owner whose house had been sold at tax sale from stripping the house during the period in which the owner could redeem the property by paying the taxes.Doctrine can be applied to tenants in common, joint tenants, mortgager and mortgagee, etc. One in possession can be restrained from using his legal power unfairly to destroy or depreciate the property in question.

If you are drawing up customized life estate, you may want to spell out where obligations are regarding various elements of waste – who must maintain, etc. You can override CL. At the very least, caution the client in writing that you are creating something with potential problems. What do you want to address? It is a family situation. “To X, Y, and Z for life on condition: to X123, Y123, Z123 (123 are grandchildren). Give thought to mechanism of who gets to go when. Give thought to use limitations: Can’t use it for business. What can they do there? Does it have to be used by them personally, or can their friends use it? Can they rent it out? You can say: “if X doesn’t use it for so many years, he loses it.”

Repairs: Define word “repairs.” Is it new roof? Who decides? You could say any repairs <$5000 can be decided by one person. You should have dispute resolution mechanism. Ending: You can say if all three argue, the trustee can declare the trust “over.” You can have clause saying person who is miserable and forces sale, that person does not get to purchase.

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If there is condo in Kits – leaving life estate to spouse. Testator is 70, spouse is 50. Maybe spouse won’t want to live there forever after he dies. You have to include clauses that allow condo to be sold – if you sell it what happens to proceeds. You can have substituted property.

LIABILITY FOR TAXES, INSURANCE.

Mayo v. Leitovski (1928): A tenant for life has an obligation to pay the property taxes. A life estate holder cannot use a tax sale to circumvent a life estate. Neither life tenant, nor anyone claiming under him, who allows ppty to be sold for taxes, can acquire title. In general, life tenant can do nothing to impair remainder, & remainder holder can do nothing to affect life estate.An elderly woman was granted a life estate on property owned by her son – she did not pay the taxes and the property went up for tax sale - the daughter bought the property in tax sale and then tried to assign the title to her mother, thereby getting around the life estate.

Re Verdonk (1979): The life tenant is under no obligation to insure the property against losses.

Andrews v. Board (1952): Example of life tenant failing to repair property as set out in husband’s will her estate had to pay the remainder for repairs. Note: The painting and decorating portion of the claim did not succeed. The failure to maintain plumbing and shingling the roof did.

CHAPTER 11: Co-Ownership – Concurrent Estates.

Types of Co-ownershipCo-ownership exists when you have two or more people with concurrent rights to possession of property.

Tenancy-in-common o Two or more persons because of interests they

own are simultaneously entitled to possession of the property – unity of possession. Ownership in terms of sharing possession (you don’t each own half, you each half of the undivided whole)

o Equal interests is not necessary – can have different shares, %age

o Can dispose of their interest either inter vivos or by will or intestacy on their death without consent of other owners UNLESS in a K.

Joint tenancy o Two or more persons because of the interests

they own are simultaneously entitled to possession of the property – unity of possession

o Unity of title – you must have equal shares in the property

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o You can dispose of your interest inter vivos, but you can’t dispose of it on death because there is a right of survivorship: “or the survivor of…”

o There is no consent of the co-owners required if you wish to dispose of your interest (you can deal with interests independently), unless stipulated in K that says otherwise.

The Four Unities – MUST be present in Joint Tenancy Time – all co-owners must receive their interest at the same time

o If a will gives property upon children reaching age of 21, they acquire their interests at different times tenancy in common

Title – both must acquire their title from the same instrument (Form A, will). A transfer of one interest severs the JT. Note: Severance only changes rights of survivorship aspect, not proportion of ownership.**

Interests – each co-owner must have an equal share in the estate in land, and must have the same quality of estate (both have legal, or both equitable, or both have legal and equitable title).*But see Aleksich!

o If A and B are JT, and A grants a mortgage to X, JT is severed because they don’t have the same quality of estate.

o If A and B are JT, and B sells ½ their interest to C A has ½, B and C each have ¼ severs JT between A and B, but B and C could have a JT.

o If A and B are JT, A goes bankrupt and trustee takes the interest, JT is severed. A’s interest passes to trustee in bankruptcy.

Possession – each co-owner is entitled to possession of the entire property; each is entitled to an equal right of possession of an undivided whole. If agreement says otherwise no JT.

CREATION OF CONCURRENT INTERESTS

1. AT COMMON LAW

CL favors creation of JT. In absence of any words to indicate otherwise JT.

Re: Bancroft, Eastern Trust Co. v. Calder (1936): A bequest to a number of persons (not fee simple) without any accompanying explanatory words creates JT, but anything which in the slightest degree indicates an intention to divide the property must be held to abrogate the idea of a JT and to create a TIC.A will grants to Minnie and Paul one quarter of the testator’s estate without mentioning how it was to be shared as between them – Paul died – his heirs wanted will to be interpreted as a TIC so that they could take, but Minnie thought will indicated JT which would give her the right of survivorship and thus one quarter of the estate. Court interpreted will as creating JT.Note: Here there was a lack of explanation or explicit wording CL presumption JT. Note: Courts have leaned strongly against JT – “Anything which in slightest degree indicates intention to divide property must be held to abrogate idea of JT and create TIC.” There were NO such explanatory words in this case.

Note: If this case had been heard in BC, and if this were for land, instead of just money, the court would have presumed it was TIC (s.11, Property Law Act).

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2. EQUITY

Favored tenancies-in-common by interpreting documents broadly.

Robb v. Robb (1993): At CL, where no words of severance, the presumption was JT. Property Law Act s.11(1) does not apply to leases.

Note: Co-operatives own all the units; person gets possession of unit through a lease.

A widow was co-owner of a co-op apartment with her late husband – she paid for shares in co-op company in full and a lease was granted, but he bought another apartment in California, which he transferred into her name, which he said was in consideration for her paying for the one in BC – Neither the lease nor share certificates indicated whether it was JT or TIC. The children from a previous marriage of husband seek to have it declared TIC, so they can make a claim under Wills Variation Act. Mrs. Robb wants it recognized as JT. Court found for Mrs. Robb, that the lease was JT at CL, and s.11 of Property Law Act did not apply because it was a lease, and not fee simple ownership. No statute CL.

3. STATUTE

Statute states that unless the instrument specifically creates a JT, the default is TIC. What still can be in dispute are property interests which have not been registered and therefore have not fallen under provisions of PLA. Note: s.11(2) applies only to LAND, not to other property. This doesn’t mean that JT cannot apply to personal property, as it can still be created at CL.

Note: Under Companies Act, s.32, companies can own land in JT (likely dissolution of the company would not be equated to the party “dying” therefore, JT would only have the survivorship benefit from person to the company).

Ss 173 & 177 of LTA requires the use of words “joint tenants.”

RELATIONS BETWEEN CO-OWNERSDISPUTES IN CONCURRENT OWNERSHIP: BOTH JT AND TIC

The fact that each joint owner has undivided interest in whole (possession) is most often the source of problems. Each of co-owners has right of possession to all of the property.

If you don’t have contractual agreement spelling these things out, you must go to default positions.

Sharing of Expenses : What if one lives there and one doesn’t – one in actual possession and the other is not? (a) Voluntarily left; (b) ouster. Differences on how these are treated in statutes.

Three sets of rules : (1) CL: if there was voluntary giving up of possession, the co-owner did not need to account to other co-owners for benefits received from still being in possession. If you pay expenses, you have no right to receive contribution of expenses. No right to restrain your possession by injunction; (2) Equity: requirement to account for profits; (3) Statutes: Estate Administration Act (s.71): Allows for accounting. Does not give a lien by the one ousted or voluntarily left person over interest of the other. Person calling for accounting

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cannot reduce the accounting. Co-owner in possession must account to other co-owners from what is received from third parties – does not interfere with principle that absent ouster, that remaining co-owners in possession need not account what they take from land (eg: don’t have to account for crops they harvest) – back to CL. Property Law Act s. 13: Allows creation of liens – where someone pays something which is MORE than their share, they are entitled to create a charge/lien against the other co-owners’ share. Process available – must go to court Remedy, not a cause of action. It must be the kind of thing that would be owing in any event.

1. Share of profits If there is no ousting no liability to share profits. No liability to pay an

occupation rent. A & B are co-owners, B goes traveling the world, A does not have to pay an occupation rent to B for staying. Limited circumstances when you have to share profits.

Spelman v. Spelman (1944): At CL, no obligation to accounts between JT unless unless one excluded another from the property OR there is K saying so. You can have accounting for TIC properties.Husband, wife running rooming house – she leaves for 6 years and comes back petitioning court for accounting of rents and profits of business husband was running. Also petitioned for accounting of separate house where they are TIC.CL modified by Statute of Anne (1705) allowing accounting if one getting more than “just share or proportion.” Husband took all risks and supplied all capital during wife’s absence. Since her return, wife did not assist husband.Court: No accounting for JT property; could have accounting for TIC home.

Estate Administration ActActions of account(71) Allows a joint tenant or tenant in common to ask for an accounting if: (i) one tenant has excluded them from the property; (ii) there is an express agreement that one tenant act as bailiff for the other (iii) one tenant is receiving more than his just share or proportion2. Share of expenses

NO claim made by co-owner in possession for expenses. If you claim expenses, you have to pay occupational rent. Note: in separation, husband leaves and wife stays. Should he charge

occupational rent? No. Balance your options! Improvements to property : Value increased. No claim unless there is a sale or

partition, at which time there can be an accounting over. If you spend $20K on new roof, you have no right to demand money now. You have to wait until it is sold!

Property Law Act, ss.13-14: RO may petition court for payments from absentee or RO co-owner in default for their proportionate share of purchase money, mortgage money, repairs, or other expenses.

Mastron v. Cotton (1926): One joint tenant, unless ousted by his co-tenant, may not sue another for use and occupation. However, when a JT is terminated by court order for partition or sale, the Court may make all just allowances for equity between parties. Court will usually require claimant submit to allowance for use and occupation.

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Can be just allowances for contributions made. If improvements made increase value, co-owner gets money back on sale. If

you paid more than your share of mortgage you can get money back at time of sale.

[Repairs to roof; exterior painting NO pay] [Install new furnace; remodel bathroom improvement – ACCOUNT!]

Bernard v. Bernard (1987): In partition action, outside ouster or K citing bailiff, occupier-owner not charged rent unless he claims allowance for expenses. If co-owner wanders, remaining person cannot be charged occupation rent unless he claims expenses.Wife seeks an order for sale of the property that she owns jointly with former husband under ss.13-14 of Property Law Act. Husband agrees to sale, but there is a dispute as to how much each is entitled to out of the proceeds. Wife claims that since the husband left on his own accord, she is entitled to mortgage contributions (to be deducted from his share of the proceeds) and he cannot claim occupation rent from her because he left on his own. Court did not agree. While she is entitled to mortgage contributions, she must make a deduction for her occupation.

TERMINATION OF CO-OWNERSHIP

1. Common intention of parties : agreement between themselves.

2. Destruction of one of the unities : usually by alienation of one party – with or without consent, but also through bankruptcy, or order of partition and sale.

3. Course of dealings which precludes one party from asserting that there was no agreement: no express agreement, but courts can look at behavior as indication of severance.

A. Severance of Joint Tenancy

Destruction of one of the unities

Stonehouse v. BC (1962): The express use of “except as against the person making the same” in LTA s.20 makes operative an unregistered instrument. Accordingly, the deed was operative when executed, thus severing JT, and preventing right by survivorship. Delivery of the deed amounts to an alienation of title which destroyed the unity of title and JT.A husband and wife were JT, but wife secretly executed a deed transferring her interest to her daughter - wife died five years later and then the daughter registered the deed. Court found it was transfer that severed JT.

This is essentially s.18 of the Property Law Act, though there it is a transfer to self, not another. Does not require consent or notice to co-owner (or even registration). (18(3)): transfer interest to yourself by fee simple or charge is severs JT in same way as transfer to stranger.

o “Sneaky spouse” with Marriage Agreement citing JT: Agreement can be registered and then Registrar will NOT accept Form A. But if agreement not registered and sneaky spouse registers Form A and later dies,

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options are: (a) Claim breach of K – only giving damages; (b) creating a resulting trust for the surviving spouse who gets property back.

North Vancouver v. Carlisle (1922): VALID IN BC – If one of the holders of a JT takes out a mortgage on the property, the legal title passes to the mortgagee subject to an equity of redemption in the mortgage unity of title is ruptured and JT is converted into a tenancy in common. If both of the joint tenants take out the mortgage, then there is no problem.

If you see mortgaging as a conveyance, it is a severance; if you see it as a charge, it is not a severance. See s.231 of the LTA.

Lyons v. Lyons, (1967 Australia): NOT VALID IN BC A mortgage by one joint tenant does not destroy the unity of title because it does not operate as a transfer of the estate. It creates but a charge or lien upon the title without any change of possession or right of possession in the mortgage and does not operate to pass legal title to the mortgagee.Mr. and Mrs. Lyons were registered owners as JT - Mr. Lyons granted a mortgage of all of his estate and interest in the land - He died, and later the mortgage was registered - issue was whether the mortgage severed the JT so that Mr. Lyons’ executors could claim an interest in the land as tenants in common with Mrs. Lyons. The court found JT survived the mortgage.

Sorensen Estate v. Sorensen (1977): Essential elements of JT are unity of possession and rights of survivorship. Unity of possession means one owner cannot maintain action of trespass against the other. JT not severed by: (a) unspecific settlement agreement which agrees to division of the title, and provides for a lease for lifetime of one of the JTs; (b) partition action that is not completed; (c) execution of will. JT severed by a trust deed which contains declaration of severance and provides that the interest is to be held in trust for another to be registered on JTs death.A marriage broke up with the wife being responsible for a mentally handicapped son – upon learning that she had terminal cancer, the wife tried to sever the JT in the matrimonial home so that she could give it to the handicapped son. The court ruled that JT was not severed, but a valid gift of beneficial interest was transferred to the son. Note: Court said subsequent conduct of wife after settlement agreement against drawing inference of severance and lack of evidence husband at any time considered JT severed was major factor in decision.

o Registration of judgment does NOT sever JT. But if credit card company takes proceedings which leads to sale of person’s interest that would sever JT.

Agreement between Joint Tenants

Flannigan v. Wotherspoon (1953): If the acts and dealings of the parties in respect to a joint property indicate an intention to treat it as property held in common and not jointly, then the court will infer an agreement to sever the joint tenancy. Two brothers held a property in JT and made an agreement for purchase and sale – when one of them died, he willed everything to his daughter (P) – she claimed against surviving brother, (D) that the acts and conduct of parties indicates a mutuality of agreement that JT was severed – D claimed that it did not sever JT and therefore the

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right of survivorship applied. Court held that JT was severed by inferred mutual agreement.Note: No direct evidence of an agreement, so the court looked to the acts for evidence of an intention to sever. The court did not need to decide whether the splitting of money alone would be sufficient to sever, but rather because there were a number of acts which cumulatively supported a decision that the intention of the parties was to sever – (surviving brother knew expressly of will of interest to P but did nothing to object).

Unilateral intention of one joint tenant

Walker v. Dubord (1992): A unilateral declaration of intention does not result in severance (of realty or personalty) because it does not destroy one of the unities. Law & Equity Act s.26: you can assign yourself personal property and it severs JT.Wife decided she wished to sever the JT of all the property she owned with her husband when she was in palliative care – created a will which left her estate to family, other than her husband (who received only the residual if her sister did not survive her by 30 days). The court found the JT in the realty was severed because of transfers of title; but JT in the personalty was not because there was no actual transfer, merely notice of intent to sever.Note: Difference between a statement of intent to sever, versus a positive, unilateral act to sever. There is no equivalent in personal property, versus realty; so it is much less clear how you can sever a JT in personal property.

Murder: A & B are JTs. A murders B. What to do? Constructive trust of ½ interest to victim’s estate. Each of A and B maintain their half interest. The murderer doesn’t lose half interest, but neither do they get to profit from their crime.

B. Partition and sale Partition : the physical division of property between co-owners so that each

becomes an owner in severalty (separate) of a particular part. CL : No right for a co-owner to partition or forced sale. Partition of Property Act : s.2: co-owner may be compelled to either partition or

sell the land. Where one owner wants to force sale and can’t get co-operation of the other.

o There is discretion in court despite granting of right in statute.o s.6: presumption that where 50% or more ownership wants partition it

should be so. o s.8(3): If an undertaking is given, the court may order a valuation of the

share of the party requesting a sale in the manner the court thinks fit, and may give directions.

o s.8: objector may be given right to buy out person who wants sale.

Harmeling v. Harmeling (1978): There is a right of a JT [or TIC] to get a partition or sale of lands, and the court will compel such a partition for sale unless justice requires that such an order not be made.Wife has come to the court asking for a partition action – she separated from her 70 year old husband who lives in the matrimonial home which he largely built during his life of operating a fish farm – she moved to a trailer with another man. The court held that no

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order should be made, exercising its discretion because justice required it not to be made.Note: It was found that the husband is old and built the house for his retirement out of funds that he acquired during the operation of his trout farm and that he would be unjustly harmed if a partition order was granted

Aleksich v. Konradson (1995): Under Partition Act s.8(3), there is room for court to “alter” distributions despite JT. Just because you have legal title (50%) does not mean you have equitable (50%). Assume A and B begin living together in 1985. A works out of town, B works in town. They live together for awhile but don’t get married. In 1987 A contributes $257K to buy a lot and build a home. In addition to the $ A makes other contribution to construction (work). B can’t point to any of their money being put in house, but B makes substantial non-$ contribution. A & B become JTs.

1. If we were to have partition and sale what would interests be? 50-50.

Relationship came to an end. B wants their half-interest in house. In meantime, property worth $475K. B brings action under Partition Act and says, “let’s sell, I want my half.” Court: First look at interests beyond title. No financial contribution of B. B is legal owner of ½ interest; equitable owner of ½ interest is A. When A gave B half interest, was giving B a gift. Was it an outright gift? B then raises Unjust Enrichment – worked on house. As remedy for claim of UE: could ask for damages, quantified by work hours. But not good: value has gone up since. So B wants an in rem (% interest in property declared, so they can participate in bump in value). B advances constructive trust argument: I have proprietary interest in property. Judge: 475-257 = 218K. Then divide 218 by 2 $109K to B.

Note: The $257 above went back to A first. Note: B is legal owner: question is whether they have equitable ownership? NO – because there was no valid gift.Reasoning: There is nothing in the evidence that persuades me that Mr. Konradson intended, or that Ms. Aleksich expected, to acquire a one-half interest in the financial contributions of Mr. Konradson, nor does equity require such a result.  It is just and equitable to conclude that the acquisition of a fifty percent interest by Ms. Aleksich was subject to an accounting for unequal contribution.

CHAPTER 15: Incorporeal Interests.

When do you Have a Licence?1. Bare Gratuitous Promise : Allow person on property – revocable at any time by

licensor. What interest must you have to grant bare? FS, LE, Lease.2. License Coupled with Interest in Land or Chattels on Land : Some has profit –

right to take minerals and right to enter the land – INTEREST in land. Co-extensive with profit: irrevocable; assignable; might be good against subsequent purchasers.

3. Contractual License : Granted for value, rights of license determined by K. At CL, they could be revoked; in equity, courts more likely to infer revocability.

A allows B to park B’s RV on part of Lot 20 for 10 years. How to label arrangement? What isn’t it? A is not giving FS – could be part of lease; A parting with possession for a

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time; could be easement: right to be on land to do something – an interest in land; could be license: right to enter upon and use another’s land in certain manner or specified purpose.

License is NOT an interest in land good chance new RO would not take subject to license.

How revocable? If no consideration, rights to revoke are great. If you try to join license with something else (eg: profit – right to take minerals off land) it gets an enhanced status.

License by Estoppel: Licensor is precluded (estopped) from revoking the license – typical situation where licensor asked licensee to do something (make improvements to land) unconscionable for licensor to rely on right to revoke.

You could give someone license for 25 years which would not run afoul of Topline (leases). Be careful you don’t create a lease!

Incorporeal Interests Incorporeal Heriditiumus : interests in land; exist in respect to land of

another; do not give right to possession.

Agreements in K must have privity – in property you can bind parties who are not parties to the original agreement, i.e. agreements can run with the land.

Interests that give a right to possession:o Leases - Life estates - Fee simple

Interests that do not give a right to possession:o Mortgages – Judgments – Easements - Covenants

s.26(2) – registration of charges, does not constitute a determination by the registrar that the instrument creates an estate or interest in land, or that the charge is enforceable.

Easement – the right by one landowner to “use the land of another for a specific purpose” (CL). **Right of support can be subject of easement.

Covenant – a promise given respecting the use of land, does not involve physical access to the land, but rather a way to control the use of land.

“I won’t use my land in a certain way.” Agreement between landowners on restriction of use of land.

Re Ellenborough Park, (1956): There are four criteria for establishing whether an agreement is an easement: (a) There must be a dominant and a servient tenement; (b) Must accommodate the dominant tenement; (c) Dominant and servient owners must be different persons; (d) A right over land cannot amount to an easement, unless it is capable of forming the subject-matter of a grant.Issue arose from the question: who gets the money for the use of the park? The court ruled the park was an easement.

(c) not valid in BC.

Summary of easements

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1. There must be a dominant and a servient tenement – at CL, there are two pieces of land – you can’t have an easement without land. In BC, the identification of the servient and dominant tenement, this is largely a non-issue, because we are mostly all surveyed land with legal descriptions. Parcels of land do not need to be immediately adjacent.

Government entities do not need to meet this requirement given LTA, s.218. Municipality does not need piece of land to be benefited. s.219 applies to restrictive covenants (waterlines moving along property). Right of ways: can be negotiated; can be expropriated.

2. An easement must accommodate the dominant tenement – there must be a benefit to the dominant tenement from the right of use which is enjoyed over the servient tenement.

3. Dominant and servient owners must be different persons – In BC, this is overruled by s.18 of the Property Law Act.

4. A right over land cannot amount to an easement, unless it is capable of forming the subject-matter of a grant:

Is the right conferred to wide and vague? You don’t know which part of land it is! Get surveyor plans with specific dimensions of easement area.

Is it inconsistent with the proprietorship or possession of the servient owners? An easement inevitably is going to interfere with possession – the

question is how much interference is there? Does the interference amount to a denial of possessory rights?

Is it a mere right of recreation without utility or benefit?

No right to light. You can’t have an easement for a right to a view. You can have easement with right to access minerals.

Easements can be created: I: (a) Grant – K between parties; (b) gets registered in LTO; (c) becomes binding. II: Passing of rights under an easement; signing Form A transferring interest, effect of Form A is that is transfers any interest the fee simple owner has in easement – “runs with the land” (182(2)). III: Created by statute: (a) Ministry of Transportation and Highways has ability to get easements through mechanism of statute – not always endorsed on title. (b) Crown can grant them by tenure. IV: Property Law Act s. 34, 36: Owner of dwelling house may apply to Supreme Court to access to land to carry out work or repair. V: LTA, s.181,182,223(1): Created at time of transfer – right to reserve certain things to yourself. If there is large piece of dominant land with easement, and it gets parceled, all new parcels benefit from easement.

Grant v. MacDonald (BC): Too much occupation will invalidate easement.Easement granted which allowed the construction of a swimming pool. At issue was whether the exercise of the grant resulted in it being inconsistent with the proprietorship or possession of the servient owner. Where do we draw the line? It is clear that there is some measure of occupation, but how much is too much?Note: The court ruled that 90-95% was too much occupation to constitute a valid easement.

Phipps v. Pears (1965): There is no right to protection from the weather.

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One wall of a building was very close to his neighbour’s house. When the neighbour’s house came down, water damage resulted.

Shelf Holdings Ltd v. Husky Oil: Use of farmland for underground pipeline is not inconsistent with the proprietary right of the servient owner.Issue: Whether a right to construct and operate a pipeline under farmland could qualify as an easement.Note: Could include underground powerlines, septic tanks, etc.“By very nature of an easement it is inevitable some measure of occupation is present in some cases and will interfere with servient tenement. It is a matter of degree.

Nordin v. Faridi: You cannot place any obligation on the owner of the servient tenement to act.Positive easements – give the owner of land a right himself to do something on or to his neighbour’s landNegative easements – give him a right to stop his neighbor doing something on his (the neighbour’s own land)In this case, it was held that an easement agreement concerning water could not be construed to impose upon the owner of a servient tenement a duty of providing or maintaining a water system.

Statutory provisions - s.218 of the Land Title Act – rights of way which can be granted to specific grantees (government, public utilities, Crown corp, railway company, municipality, etc) without a dominant tenement adjacent (e.g. sewer lines). Note: s218(1)(d) allows conservation groups to be grantees, as designated by the Minister of ELP. Easement can exist in gross as long as person benefiting is one of certain persons. Note: These are called “rights of way.”

Creation of easementso Express grant – K that is negotiated, registered, and becomes binding on

subsequent land owners; includes statutory rights of wayo Statute

o s.40 of the Land Act – which grants easements over Crown lando s.34 of the Property Law Act – right to enter and repair when your

properties are adjacent and too close together to permit repair from your own property

o Land Title Act – s.181, 182 deals with registration and rights of transfer; s.223 deals with when the dominant tenement is subdivided

PROFIT A PRENDRE

CL concept we don’t often see in BC, as they are dealt with in other ways. A right vested in one man of entering on the land of another and taking a profit from the soil, e.g. minerals, oil, stones, trees, and turf. Generally, there could be an analogy drawn between the common law concepts of profits and the right to hunting and fishing, particularly by aboriginal people.

At CL, you could have a profit in gross.

CHAPTER 16: Covenants.

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Can be used to create rights enforceable by one landowner over another. As with easements, they began as Ks between landowners. Easements – rights to use; Covenants – restrict use on servient tenement.

Used extensively for:1. Subdivision of land: you want to create “feel” of subdivision. Zoning imposed by

municipality may not be sufficient. Owner of parent parcel impose covenants on all of them. [Weakness: are you going to start an action to enforce? No government will. It is up to landowners to enforce].

2. Commercial Settings: You may want to place covenants on certain parcels from using land for restaurant. In shopping centers/small malls – to restrict the kinds of businesses that can locate there.

Common law position Positive covenants – require landowner to do something (subdivision covenants

which require landowners build a house with a certain kind of roof/siding) Negative covenants – that require a landowner not to do something (land use

control, like a municipal bylaw), e.g. restricting the kinds of businesses in a shopping centre

They both have benefits:o In contracts to transfer the benefit under a covenant, you use assignment. o You could attach the covenant to the land, so that when the fee simple

ownership changed, the benefit of the covenant would pass to the new fee simple owner. This requires specific elements:

It must “touch and concern” the land – to relate to the mode of occupation, or directly affect the value of the land

They both have burdens:o At common law, you couldn’t pass on the burden of a covenant to another

person. Tulk v. Moxley allowed the passing of the burden.

Tulk v. Moxley (1848): A covenant can be passed on to a subsequent landowner at equity.Tulk sold property with a covenant in the deed to Elms, who subsequently sold property to Moxley, without the covenant noted on the deed, though Moxley was aware of the covenant. This type of enforcement still goes on today, i.e. the landowner enforcing against another. Generally the relief is to get an injunction. If an equity is attached to the property by the owner, no one purchasing with notice of that equity, can stand in a different situation from the party from whom he purchased.

Canada Safeway v. City of Thomson (1996): This case sets out qualifying conditions for covenants to be passed on to subsequent purchasers. Woolworth had a shopping mall, in which Safeway leased a unit – covenant negotiated which would prevent competition from renting space. Phase 2 of the development, was sold to the city, who wanted to develop the land in such a way as to be able to ignore the restrictions in the covenant. Note: in order to protect its interests, Safeway registered a caveat – different in Manitoba than in BC; there they are used to give people notice of certain interests. At issue was whether or not the agreement was binding only on the original owners, or also on subsequent purchasers. Applying Tulk Safeway can rely on the equity interest to enforce the covenant on a subsequent purchaser. The court identified certain qualifying conditions:

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The covenant or agreement must be negative The covenant must affect the land itself by controlling its use Two plots of land must be concerned

If the agreement does not meet these conditions, while it will still be valid between the original contracting parties, it will not be binding on subsequent owners. Take this as law in BC:

Covenant must be negative in substance Touches and concerns the land Benefited as well as burdened land must be defined with precision Conveyance should state the covenant is imposed It must be registered, unless precluded by statute Covenantor and covenantee must be different people

As with easements, the mere registration of a document with covenants in it, does not say anything about the enforceability of those covenants.

Statutory provisionsThere are provisions in BC which override some of the case law.

s.181(1) – you can create a restrictive covenant at the time of the transfer of the fee simple (i.e. in the transfer document) in such a way as to create a registered interest

s.182 – registrar must make endorsement against title of both properties s.183 – effect of entries is that they get carried forward (181 – 183 deal with the

historical treatment of covenants) s.219(1) – parallel to 218 for easements; covenants which can be granted to

specific grantees (government, public utilities, etc) without a dominant tenement adjacent (e.g. sewer lines)

s.219(2) – both positive and negative covenants are covered, to control the use, to restrict building, to restrict further subdivision, to restrict purchasers; widely used by municipalities to control land use

s.219(3)(4)(5) – reference to organizations designated by Min of ELP (to protect e.g. swamplands, heritage buildings, etc)

s.219(6) – may include a rent charge; essentially becomes the method that is used to make sure the covenant is obeyed with (like a penalty, or disincentive to disobey covenant)

s.220 – statutory building schemes (letting schemes); put in place at the time of the subdivision of land; when the subdivision is created, the building scheme is declared and registered against the interests of all the subdivided lots.

Note: covenants can be very intrusive. Though their importance tends to diminish over time, it is important to make sure that the house is in compliance when purchasing, because you wouldn’t want to find out, after the purchase, that the house is not in compliance, and be on the hook for fixing it.

Common: right to impose obligation on how high you can build a house that would obstruct view of people behind.

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