CANADA Law and Practice Contributed by: Rachel V Hutton, Michael L Dyck, Mario Paura and Patrick Morin, Stikeman Elliott LLP
the minds”, but the sale may not be opposable against third parties until a deed is registered. Land Registration Systems There are two types of land registration systems in Canada: • the registry system – a public record of instru - ments affecting land; and • the Torrens (land title) system – which is government-operated and effectively guaran - tees title, subject to certain limitations. Each province and territory uses either one or a combination of these systems. However, most common-law jurisdictions have converted or are converting to the more modern Torrens system. Registration of Instruments Requirements for registration of instruments affecting land differ across the various provinces and territories and may include procedural, for - mat and content requirements. Electronic regis - tration of instruments is increasingly available in most jurisdictions. All registered instruments in Quebec must be submitted in French only. Title Insurance Title insurance is commonly used in Canada, but somewhat less in provinces with a Torrens sys - tem (ie, with a statutory assurance of title). Many lenders require borrowers to obtain title insur - ance. Title insurance can also insure against matters otherwise typically covered by diligence, such as when a legal survey is not available, or when unusual title risks exist. Documentation and Transactions The pandemic has resulted in increased flex - ibility and new processes for documentation and completion of real estate transactions in Canada, including remote witnessing through
videoconference and use of affidavits of execu - tion for remote execution of land title documents in certain provinces. Electronic filing of docu - mentation with government authorities has been further expanded, such as transfer tax filings and certain land registry filings which previously required paper submissions. 2.4 Real Estate Due Diligence Typically, a buyer and seller will enter into a conditional purchase agreement, following which due diligence is conducted. If the buyer is satisfied with its investigations, it will waive its due diligence condition and the transaction will become “firm”, provided any other conditions have also been satisfied. Real estate due diligence generally consists of: • examining title and zoning; • conducting inquiries with government authori - ties and utilities; • reviewing leases, property contracts and surveys; and • commissioning environmental and building condition assessments. 2.5 Typical Representations and Warranties Typical contractual representations and warran - ties that a seller gives a buyer depend on mar - ket conditions and the relative bargaining power of the parties. Depending on market leverage, sellers typically seek to sell their real property on an “as is” basis, with limited warranties as to factual matters that might be difficult for a buyer to verify independently, such as the fact that the seller: • has delivered all contracts, leases and reports in its possession or control; and
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