QUESTION ONE – TRUE OR FALSE? (25 MARKS) Please write T or F in the space provided. Each question is worth 1 mark.
________ In a busy law office, a law clerk may be given the ultimate responsibility for review and signing of a real estate reporting letter to a client.
________ If title to the matrimonial home is in the name of the husband only, he may sell the property without the consent of his spouse as long as he mentions it to her.
________ It may be possible to legally acquire a piece of your neighbour’s property simply by building a shed over the property line onto his property.
________ Law clerks are never allowed to send any letters relating to a real estate transaction under their own names.
________ The land that supplies an easement to another property is called the dominant tenement.
________ Joe and Moe wish to own a house as tenants in common; they do not have to own equal shares in the title.
________ If a law clerk makes a mistake on a real estate file, errors and omissions insurance will automatically cover any claim the client might have against the law firm.
________ Laws passed by a municipality that affect how owners may use their land are called regulations.
________ Alice borrows $100,000 from Best Bank and gives a charge on her property as security for the loan. Alice is the “chargee” and Best Bank is the “chargor”.
________ With blended mortgage payments, the amount of principal repaid each month is a fixed amount.
________ Under the construction legislation, only property owners and general contractors are required to hold back money when paying for work done on a house.
________ An owner of property that has a mortgage registered against it must get the consent of the bank before selling the property.
________ If there are two charges registered against the same property, the largest one will have top priority if a default occurs.
________ Paul is a subcontractor who has not been paid for plumbing services he provided in the renovation of a home. He may sue the owner of the property.
________ A subsearch is a brief examination of title records to update an earlier search of title. It is usually performed immediately before registration of a document.
________ If a property owner fails to pay tax arrears, a municipality may be able to sell the property in the second year following the year in which the realty taxes became due.
________ In 1995, the Supreme Court of Canada decided that there is no need to look for a root deed outside the 40-year title search period provided that there is a conveyance sometime within the 40-year period.
________ A vendor may obtain a consumer credit report on a purchaser.
________ A purchaser may not be obliged to complete the purchase and accept title if a survey discloses that adjoining buildings or structures are encroaching on the property.
________ If an Agreement of Purchase and Sale states that the property includes a right of way over another property, you will need to search the title to the other property as well.
________ In a busy law office, a law clerk may review title insurance options with a client, and place the order for the title insurance.
________ In a busy law office, a law clerk may complete the client identification process related to a residential real estate purchase.
________ Law clerks may very occasionally give undertakings on behalf of lawyers in real estate transactions if the lawyer gives them permission to do so.
________ A Planning Act title search is not required if the land is a whole lot on a plan of subdivision.
________ Every encumbrance that is attached to property must be cleared before closing.
________/ 25 TOTAL Question One
QUESTION TWO – MULTIPLE CHOICE (10 MARKS) Please write the letter of the best answer in the space provided. Each question is worth 1 mark.
__________ Which of the following land registration systems does not provide a guarantee of title?
| a. | Land titles system |
| b. | Registry system |
| c. | Neither of the above |
__________ Which of the following is not the correct name of a document you might find in conveyancing law?
charge/mortgage
transfer/deed
cessation of charge/mortgage
all of the above
none of the above
__________ Harry and Ginny are buying a house and wish to have the right of survivorship. They should take title:
| a. | as joint tenants |
| b. | as tenants in common |
| c. | as grantor/transferor |
| d. | as mortgagor/mortgagee |
| e. | on joint account |
__________ Hermione and Ron are the sellers in a residential real estate transaction. In the transfer document, they would be the:
| a. | Joint Tenants |
| b. | Transferors |
| c. | Transferees |
| d. | Mortgagors |
| e. | Mortgagees |
__________ The Andrews sisters all hold title to a property as tenants in common. Maxene, the eldest, suddenly dies. Which statement is correct?
| a. | The remaining sisters have the right of survivorship and are now joint tenants. |
| b. | The remaining sisters have the right of survivorship as tenants in common. |
| c. | The remaining sisters remain as tenants in common with the estate of Maxene. |
| d. | Maxene’s share goes to the government, which can force the sale of the home. |
__________ Most property is held in ___________________, which provides for the closest thing to absolute ownership:
| a. | life interest |
| b. | life estate |
| c. | fee interest |
| d. | leasehold |
| e. | fee simple
|
__________ The base amount of a mortgage debt is referred to as the:
| a. | term |
| b. | terms |
| c. | maturity |
| d. | principal |
| e. | payment
|
__________ The date on which all monies are due under a mortgage is referred to as the __________ date:
| a. | term |
| b. | terms |
| c. | maturity |
| d. | principal |
| e. | amortization |
__________ Bob is purchasing his new home on April 15, 2023 and the mortgage funds will be advanced the same day. The mortgage is for $200,000 at an interest rate of 5.0% with a blended monthly mortgage payment of $920.25 for an initial period of 5 years. Bob’s last payment will be made in the month of ___________________.
| a. | April 2028 |
| b. | May 2028 |
| c. | June 2028 |
| d. | July 2028 |
__________ Big Bank has sold Bob’s mortgage to Trusty Bank. Bob’s mortgage is said to have been:
| a. | extended |
| b. | assumed |
| c. | assigned |
| d. | renewed |
| e. | discharged |
_______/10 TOTAL Question Two
QUESTION THREE – CONVEYANCING TERMINOLOGY (10 Marks)
For each of the following definitions or short pieces of information, supply the legal term or phrase that best identifies the definition. Each question is worth 1 mark.
| DEFINITION |
LEGAL TERM or PHRASE
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| 1. A registered __________ is another name for a document registered on title.
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| 2. This type of charge/mortgage can be paid off without penalty at any time.
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| 3. Rules governing the internal operation of a condominium corporation are also known as: |
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| 4. This Latin phrase clearly places the onus on the purchaser to exercise caution when buying a home, perhaps consulting a home inspector.
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| 5. This type of designation may prevent an owner of an old house from doing certain types of renovations if they detract from the old-fashioned look of the house.
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| 6. Term for property that shares a common boundary with the property being title-searched.
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| 7. This search is done to make sure there are no writs at the Sheriff’s office against the seller of the property.
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| 8. Real estate term for written negotiations back and forth between the buyer and the seller regarding various matters in the agreement of purchase and sale.
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| 9. Claim against land that will act as security for the payment of a debt by the landowner.
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| 10. Assessment of property conducted to determine the likelihood that one or more contaminants have affected the property.
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________ / 10 TOTAL Question Three
QUESTION FOUR – SHORT ANSWER (43 MARKS) Please answer the following questions in the spaces provided. Pay attention to the marks assigned to each question!
(a) Concession II in the Township of North Frontenac, County of Frontenac is divided into four lots. The shaded portion in the diagram below is Lot 4. What would be the legal description of the shaded portion? (2 mks.)
| 4
|
3 |
| 1
|
2 |
(b) The diagram below represents part of Lot 4, Concession II in the Township of North Frontenac, County of Frontenac, and is registered as Plan 8765. What would be the legal description of the shaded portion? (2 mks.)
| 12 | 1 |
| 11 | 2 |
| 10 | 3 |
| 9 | 4 |
| 8 | 5 |
| 7 | 6 |
Aunt Matilda transferred a property into the name of her niece Brunhilda, who is 17 years old. The ungrateful Brunhilda now wishes to sell the property. Is there a problem with that, and how would it have to be dealt with? (3 mks.)
Luke recently purchased his first home with mortgages obtained from Galaxy Bank and the vendor, Mr. Kenobi. Briefly explain what would happen in each of the following situations. Please Note that part (b) does not build upon the facts in part (a).
If Mr. Kenobi signed over his mortgage to Mr. Vader, who would give Luke the discharge of the mortgages next year? (2 mks.)
If Mr. Kenobi were to die in tragic circumstances just before Luke was ready to completely pay off the mortgages, how could Luke receive a discharge of the mortgages? (2 mks.)
Leia borrows $100,000 from Galaxy Bank on May 10th for her house purchase and arranges to make blended monthly payments on the 1st of each month. The first monthly payment will be due on July 1st.
When is Leia’s interest adjustment date? (2 mks.)
What is required if there is an existing mortgage on the property that Leia does not want to assume? (2 mks.)
(a) Sam owns a cottage property. He would like his sister to be able to live on the property until she dies, but he wants his niece and nephew to eventually inherit it. What should Sam do to arrange this? (2 mks.)
(b) Sam presently has a closed charge with his bank. He has just won the lottery and wants to pay off the charge. Can he do this? Briefly explain your answer. (2 mks.)
Ollie is the owner of an old house in downtown Kingston. He hired Chuck as a contractor to renovate his house, and Chuck hired Paul to paint the interior. Paul completed his work on August 31st, and it looked very nice, even if he did say so himself. It is now September 21st and Paul has not been paid for the painting work. Paul would like to know about the process involved in collecting the money owing to him.
By what date must Paul take his first steps toward getting his money? (1 mk.)
What is the terminology for this initial legal process? (1 mk.)
By what date must Paul take his next steps toward getting his money? (1 mk.)
What is the terminology for this legal process? (1 mk.)
Whom can Paul sue, and for what? Briefly explain your answer. (4 mks.)
Matilda Manning purchased a property with her then-boyfriend. They got married, and when they sold the property, her name was Matilda Denning. Will her change of name cause an issue when they want to sell the property? Briefly explain your answer. (2 mks.)
A buyer recently purchased farmland, unaware that it contained toxic waste buried long ago. The farmer selling the land was aware of the toxic waste but said nothing about it to the buyer. The barrels of toxic waste are now seeping into the water table. The toxic waste was discovered soon after closing due to the contamination of the water table and its effects on neighbouring properties. The Ministry of the Environment has issued a clean-up order against the property. What is the position of the buyer who recently purchased the farmland? (5 mks.)
Barbie and Ken owned their Dream House as joint tenants. Sadly, Ken died a couple of years ago, and now Barbie wishes to sell the property, as she plans to marry a GI named Joe. The Dream House is registered in the Land Titles system. What must Barbie do if Ken’s name is still on title to the Dream House? (2 mks.)
What is a chain of title and why is it important? (3 marks)
Briefly describe two things a lawyer may not delegate to a law clerk in a real estate transaction. (4 marks)
________/ 43 TOTAL Question Four
QUESTION FIVE – CLIENT FILE (12 marks)
Our client, Celia, is interested in purchasing a condominium, but she has heard from friends and colleagues that “condo fees” or “condo expenses” can be very high. She would like to know what “condo fees” are, and whether she would have to pay any of them.
Explain to Celia what expenses the condominium corporation might impose on condominium owners — and explain to her whether she would have to pay them. (12 marks)
________ / 12 TOTAL Question Five BONUS QUESTIONS – Next Page à
BONUS QUESTIONS (1 mark each)
Your search of title has revealed that there hasn’t been a conveyance of the property within the required search period. What would your Conveyancing professor recommend that a careful law clerk should do regarding this title search?
Answer:
This real estate term refers to both the signing of the Agreement of Purchase and Sale and a writ of seizure and sale.
