Canadian property law

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Canadian property law, or property law in Canada, is the body of law concerning the rights of individuals over land, objects, and expression within Canada. It encompasses personal property, real property, and intellectual property. The laws vary between local municipal levels, up to provincial and then a countrywide federal level of government. And the form of purchase can vary from sale to different types of leases, whilst transactions can be made through a physical paper form or digitally for the acquisition of property in Canada's ten provinces and three territories.

Contents

Property law description

In Canada, each province and territorial government has its own statutes for real estate, but within the same legal framework for the country which is based on the older English common law. Whilst Quebec's code (CCQ) is based on common law, which was once based upon the older Napoleonic Code. Then, foreign laws are only allowed to be used in special occasions, as normally international laws are allowed in Canadian courts. The country has government statues, the Investment Canada Act, and Competition Act as well as the provincial laws in place throughout Canada's 10 provinces and 3 territories. [1] The buying and selling of property is normally done through a real estate agent who work on a financial commission and act as a broker between buyer and seller. As well as brokers, the sale of property can be done with the aid of a lawyers (commercial sales), notaries (Quebec), surveyors, title insurers or third party consultants. [2] Then, whilst property is private, in Canada, there isn't a constitutional protection of property right, as the government can force an owner to sell them their land through expropriation, where compensation will be given based on the market value of the land. Then a buyer will often need permission through a municipal planning firm, and could require a survey on a potential flood threat, depending on the location of a development with building permits required, and in some cases environment permits and other licenses from a local, provincial or federal agency. For instance, in Toronto there is the need for the preservation of historic sites, and the city has designated buildings because of their heritage, cultural or historical significance, whilst the city also provides tax break for specific conservation projects under the Ontario Heritage Act. Then, there is also the case of the need to ensure the property is compliant with environmental laws and standard, as in the property in question must be a safe environment. The National Energy Code of Canada for buildings 2011 was created in coordination with LEED (green energy) and BOMA BESt (Building Environmental Standards) which look after environmental issues for buildings. [3]

Ownership

Each of Canada's provinces and territories have they're own property laws. Despite the fact there are no restrictions regarding taxes and registration and reporting requirements within the laws, there are differences regarding property licenses in the provinces of Ontario, Quebec and British Columbia. There are transfer taxes, and in recent years, different provinces have enacted a new foreign taxation policy to restrict a non-Canadian resident from investing in the country, i.e. in 2017, the cities of Toronto and Vancouver have imposed a 15% transfer tax rate on the sales of homes to foreign residents without Canadian citizenship, and Vancouver did pass a 1% vacancy tax on empty properties. Whilst bigger cities have changed the laws because of an influx of foreign buyers, other provinces have made even stricter rules on the ownership of land by non-residents of Canada, i.e. provinces have imposed the Land Protection Act and the Agricultural and Reactional Land Ownership Act, which have been renewed in restrict the purchase of land by non-residents of Canada. [1]

Sale and purchase

The sale of a property or land in Canada must be done with a deed of land, which is accepted upon sale, be it physical or electronic, whilst Quebec additionally asks for the endorsement of a notary. The general sale of property comes with a buyer beware guide (Latin : caveat emptor) with three classification; firstly, owner must disclosed the full extent of the quality of the property; secondly, potential environmental contamination must be clear; thirdly, the law does not accommodate to the full extent for fraud. To facilitate the sale of property, a buyer can lend money from a licensed individual as a mortgage broker, or a lender which are regulated by a government act in 2006. [4] There are several common options available for a mortgaged home owner in Canada, they include a power of sale; judicial sale, action on covenant (lawsuit); and possession. Again, Quebec has a separate remedy, including the purchase through a secured creditor, and also the option of a judicial authority. Then, in case of the scenario, if the lender were to cease to exist, it would have to give notice under the federal bankruptcy legislation. [5]

The sale and transfer of property in Canada can be done through a provincial level or in some differing jurisdiction cases, a municipal level. Then, each province has its over land transfer tax rate. [5] The transaction needs to be registered with the registry office to be completed, or again in some cases at a local municipality. With commercial property being subject to a different tax rate than private property. With commercial leases varying between provinces under either a gross (monthly fixed rent) or let (full amount) lease. [6]

Leases

Of Canada's provinces, 9 are part of the Residential Tenancies Act in place for controlling rent leases. Then, in Quebec, article 1892 of the civil code regulates the leases. The individual leases have terms and conditions agreed upon by the tenant and landlord, with a Landlord and tenant board supervising the processes in court cases. [7]

Foreign ownership law

On January 1, 2023, Canada enacted a law prohibiting foreigners, except for immigrants and permanent residents, from acquiring residential areas in the country for two years in response to a real-estate bubble. [8]

Rights

Hold rights

An owner can acquire a property through either a freehold or leasehold (exclusive possession), and can either a co-ownership, common or joint tenancy, which allows for property to be held for a specific amount of time. As well as a hold, a tenant in the Canadian property market can gain a contract for easement (right of way), restrictive covenants (specific manner), or in servitude (burden to another). Whilst in Quebec, usufruct, servitudes, superficies (above ground i.e. condo), and emphyteusis (period of time) are the types of rights for land. Then a license allows the owner to use the land in the terms agreed in the contract. [9]

Titles

In between provinces, there are differences in the legal and beneficial titles, e.g. in Alberta, a beneficial owner can split the property and register a caveat, showing an interest only as opposed to whole ownership. But, normally beneficiaries are not recorded in the paperwork. That despite all land in Canada is required to be registered to a public land registry or a registry system or both. In cases of fraud, the Canadian legal system can accommodate a limited recovery of money, that is without any insurance coverage. With ownership registration, each province has its own rules for the title granted for registering with laws varying for fraud upon the sale of personal property. [10]

Canadian registries

There are numerous registries operating in different jurisdictions in Canada operating within they're own rules. The provinces of British Columbia, Alberta and Saskatchewan operate on a similar land titles system, whilst the registry system applies to Prince Edward Island and Newfoundland and Labrador with a similar system in Quebec. Then Ontario mostly uses a land titles system from previously using the registry system. Land titles are also used in Manitoba, Nova Scotia and New Brunswick. [11]

Physical or electronic

In Canada, different provinces have enacted different requirement to register property (land registry), as in on a physical sheet of paper, or now digitally on an electronic device, but a registration is mandatory no matter what for legal purposes, all of which need to be accessed at a centralized government land registry office. [11]

Personal property

Personal property laws are typically governed by provincial legislation such as the provincial Sale of Goods Acts. Likewise, the common law rules inherited from the United Kingdom are largely still in force. Real property law is likewise a matter of provincial legislation with the incorporation of English common law rules, except in Quebec, where French civil law is foundational.

Intellectual property

Intellectual property, as with most common law countries, remains entirely based in federal statute; however, there are common-law economic torts related to intellectual property, e.g., passing off. Canada tried to take the middle road between the United Kingdom and the United States in many of their intellectual property laws. Copyright law and trademark law in Canada was initially based on the English legislation but has since incorporated many changes from the US model and other places. Canadian patent law, however, was initially based on US legislation but has typically favoured the application of UK case law.[ citation needed ]

Related Research Articles

Property law is the area of law that governs the various forms of ownership in real property (land) and personal property. Property refers to legally protected claims to resources, such as land and personal property, including intellectual property. Property can be exchanged through contract law, and if property is violated, one could sue under tort law to protect it.

Canadian federalism involves the current nature and historical development of the federal system in Canada.

In law, conveyancing is the transfer of legal title of real property from one person to another, or the granting of an encumbrance such as a mortgage or a lien. A typical conveyancing transaction has two major phases: the exchange of contracts and completion.

In common law and statutory law, a life estate is the ownership of immovable property for the duration of a person's life. In legal terms, it is an estate in real property that ends at death, when the property rights may revert to the original owner or to another person. The owner of a life estate is called a "life tenant". The person who will take over the rights upon death is said to have a "remainder" interest and is known as a "remainderman".

A property tax is an ad valorem tax on the value of a property.

<span class="mw-page-title-main">Condominium</span> Form of ownership of real property

A condominium is an ownership regime in which a building is divided into multiple units that are either each separately owned, or owned in common with exclusive rights of occupation by individual owners. These individual units are surrounded by common areas that are jointly owned and managed by the owners of the units. The term can be applied to the building or complex itself, and is sometimes applied to individual units. The term "condominium" is mostly used in the US and Canada, but similar arrangements are used in many other countries under different names.

Adverse possession in common law, and the related civil law concept of usucaption, are legal mechanisms under which a person who does not have legal title to a piece of property, usually real property, may acquire legal ownership based on continuous possession or occupation without the permission (licence) of its legal owner.

In Canada, taxation is a prerogative shared between the federal government and the various provincial and territorial legislatures.

<span class="mw-page-title-main">Land tenure</span> Legal regime in which area owned by an individual is held by another person

In common law systems, land tenure, from the French verb "tenir" means "to hold", is the legal regime in which land "owned" by an individual is possessed by someone else who is said to "hold" the land, based on an agreement between both individuals. It determines who can use land, for how long and under what conditions. Tenure may be based both on official laws and policies, and on informal local customs. In other words, land tenure implies a system according to which land is held by an individual or the actual tiller of the land but this person does not have legal ownership. It determines the holder's rights and responsibilities in connection with their holding. The sovereign monarch, known in England as the Crown, held land in its own right. All land holders are either its tenants or sub-tenants. Tenure signifies a legal relationship between tenant and lord, arranging the duties and rights of tenant and lord in relationship to the land. Over history, many different forms of land tenure, i.e., ways of holding land, have been established.

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<span class="mw-page-title-main">Deeds registration</span>

Deeds registration is a land management system whereby all important instruments which relate to the common law title to parcels of land are registered on a government-maintained register, to facilitate the transfer of title. The system had been used in some common law jurisdictions and continues to be used in some jurisdictions, including most of the United States.

<span class="mw-page-title-main">Canadian contract law</span> Overview of contract law in Canada

Canadian contract law is composed of two parallel systems: a common law framework outside Québec and a civil law framework within Québec. Outside Québec, Canadian contract law is derived from English contract law, though it has developed distinctly since Canadian Confederation in 1867. While Québecois contract law was originally derived from that which existed in France at the time of Québec's annexation into the British Empire, it was overhauled and codified first in the Civil Code of Lower Canada and later in the current Civil Code of Quebec, which codifies most elements of contract law as part of its provisions on the broader law of obligations. Individual common law provinces have codified certain contractual rules in a Sale of Goods Act, resembling equivalent statutes elsewhere in the Commonwealth. As most aspects of contract law in Canada are the subject of provincial jurisdiction under the Canadian Constitution, contract law may differ even between the country's common law provinces and territories. Conversely; as the law regarding bills of exchange and promissory notes, trade and commerce, maritime law, and banking among other related areas is governed by federal law under Section 91 of the Constitution Act, 1867; aspects of contract law pertaining to these topics are harmonised between Québec and the common law provinces.

<span class="mw-page-title-main">Scots property law</span> Rules relating to property in Scotland

Scots property law governs the rules relating to property found in the legal jurisdiction of Scotland.

<span class="mw-page-title-main">English land law</span> Law of real property in England and Wales

English land law is the law of real property in England and Wales. Because of its heavy historical and social significance, land is usually seen as the most important part of English property law. Ownership of land has its roots in the feudal system established by William the Conqueror after 1066, but is now mostly registered and sold on the real estate market. The modern law's sources derive from the old courts of common law and equity, and legislation such as the Law of Property Act 1925, the Settled Land Act 1925, the Land Charges Act 1972, the Trusts of Land and Appointment of Trustees Act 1996 and the Land Registration Act 2002. At its core, English land law involves the acquisition, content and priority of rights and obligations among people with interests in land. Having a property right in land, as opposed to a contractual or some other personal right, matters because it creates priority over other people's claims, particularly if the land is sold on, the possessor goes insolvent, or when claiming various remedies, like specific performance, in court.

The Personal Property Security Act ("PPSA") is the name given to each of the statutes passed by all common law provinces, as well as the territories, of Canada that regulate the creation and registration of security interests in all personal property within their respective jurisdictions.

<span class="mw-page-title-main">Missives of Sale (Scots law)</span> Scottish trading law

The missives of sale, in Scots property law, are a series of formal letters between the two parties, the Buyer and the Seller, containing the contract of sale for the transfer of corporeal heritable property (land) in Scotland. The term 'land' in this article includes buildings and other structures upon land.

<span class="mw-page-title-main">Disposition (Scots law)</span> Deed transferring ownership of heritable property

A disposition in Scots law is a formal deed transferring ownership of corporeal heritable property. It acts as the conveyancing stage as the second of three stages required in order to voluntarily transfer ownership of land in Scotland. The three stages are:

  1. The Contractual Stage
  2. The Conveyancing Stage
  3. The Registration Stage

References

  1. 1 2 (Morpeth 2017, p. 30)
  2. ↑ (Morpeth 2017, pp. 32/3)
  3. ↑ (Morpeth 2017, p. 39-40)
  4. ↑ (Morpeth 2017, p. 34)
  5. 1 2 (Morpeth 2017, p. 35)
  6. ↑ (Morpeth 2017, p. 36)
  7. ↑ (Morpeth 2017, p. 38)
  8. ↑ Isidore, Chris (1 January 2023). "Canada is banning some foreigners from buying property after home prices surged | CNN Business". CNN. Retrieved 8 February 2023.
  9. ↑ (Morpeth 2017, pp. 30/1)
  10. ↑ (Morpeth 2017, p. 31)
  11. 1 2 (Morpeth 2017, p. 32)

Notes

    Sources

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