CANADA Law and Practice Contributed by: Rachel V Hutton, Michael L Dyck, Mario Paura and Miguel Manzano, Stikeman Elliott LLP
2. Sale and Purchase 2.1 Categories of Property Rights
countries (in the case of individuals) and those whose directors and ultimate shareholders are not domiciled in Quebec (in the case of corpo - rate entities). See also 2.11 Legal Restrictions on Foreign Investors regarding the federal Pro - hibition on the Purchase of Residential Property by Non-Canadians Act. 2.3 Effecting Lawful and Proper Transfer of Title In common-law jurisdictions, registered (legal) title is typically transferred to the buyer upon registration of a deed or transfer in the rele - vant land registry office. In Quebec, ownership is transferred as soon as there is “meeting of the minds” , but the sale may not be opposable against third parties until a deed is registered at the land registry office. 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 exceptions. 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.
Property rights fall within the jurisdiction of the provinces or territories, and differ across the country. Each jurisdiction has statutes that gov - ern the acquisition, ownership, use, financing and development of real estate. In common-law jurisdictions, a freehold estate in real property is a right or interest that exists for an indefinite duration. Conversely, leasehold estates have a fixed duration. A fee-simple estate is the most common freehold estate in Canada and is con - sidered absolute ownership of real property. A leasehold estate is not absolute but confers an exclusive right of possession during the lease term to the tenant. Other non-possessory rights in land include: • easements and rights-of-way to use a portion of land for a specified purpose; and • restrictive covenants restricting the use of land. Licences to use land are contractual, do not cre - ate an interest in land and generally do not grant exclusive possession. In Quebec, real estate is generally governed by the Civil Code of Quebec, which distinguishes between personal rights and real rights. 2.2 Laws Applicable to Transfer of Title Transfers of title are governed by provincial and territorial statute. Certain jurisdictions (Alberta, Manitoba, Prince Edward Island, Quebec and Saskatchewan) restrict the ownership of farm - land, rural recreational land or land in non-urban centres by non-residents. In Quebec, non-resi - dents who are restricted from acquiring farmland include residents of other Canadian provinces or
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