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PAGE 10 FOCUS January 17, 2011 • Law Times Lawyers cashing in on MLS challenge Real estate practitioners can earn more fees per transaction BY DARYL-LYNN CARLSON For Law Times F ollowing a challenge by the federal Competition Bureau of the Canadian Real Estate Association's Mul- tiple Listing Service, real estate lawyers are perhaps in a more advantageous position when representing a client in a trans- action. Primarily, they now have the opportunity to earn more fees per transaction than they did prior to the bureau's MLS challenge now that real estate agents will make less in com- mission. Th is is due to the fact that as a result of the challenge, lawyers will be responsible for completing the purchase-of- sale document rather than a real estate agent. But it will mean that lawyers will have to spend more time on a fi le, says Brian Madigan, a lawyer and real estate broker for Royal LePage. "Th e information on MLS has to be accurate, and there's an obligation on behalf of law- yers to verify the facts. And the negotiations in real estate deals will now be more complex." Madigan, who practised real estate law for years before joining due diligence in lieu of real estate agents who dealt with the con- tract, which was a simple model with just one negotiator." But Madigan notes lawyers will indeed earn more money, upwards of $2,500 on a trans- action worth $250,000, for example. Still, with the added work, they'll earn it given the clients more thoroughly and bill more for their services. But there may be other benefi ts, he adds, noting a lack of opportu- nities to earn a good living has deterred young lawyers from focusing on real estate at small- er fi rms in rural areas. But with CREA's compli- ance with the bureau's challenge, When lawyers fi nish school, they have not been looking at real estate because they can't make any money. But I think that has all changed with this development. Royal LePage, says lawyers will have to become reacquainted with listings and related agree- ments, negotiations, and their responsibilities as a result. "My fear is that many lawyers are not going to be aware of the fact that there are now two diff erent con- tracts, one for the buyer and one for the seller, that they have to review. In terms of the negotia- tion process, lawyers have more time involved in research and negotiations. "Th ese transactions will certainly be more complex for lawyers, but it's much better for the consumer," Madigan says. Michael Forcier, a sole prac- titioner in Owen Sound, Ont., agrees the changes will put more onus on lawyers while also enabling them to assist things look much brighter for the real estate law bar, he says. "When lawyers fi nish school, they have not been looking at real estate be- cause they can't make any money. But I think that has all changed with this development." Forcier is also one of the founders of propertyshop.ca, a web site on which people can sell properties with a lawyer providing the legal work and advice. It now has hundreds of member lawyers through- out Ontario and is one of the benefactors of the bureau's challenge. It includes a web site with MLS listings, contact information for lawyers, a long list of services practitioners can provide to clients, tips, and a checklist for sellers and buyers to use in completing a sale. "For the consumer, they can save huge amounts of money using this service," says Forcier. "And [with] the fact that it's opened up the MLS, it's giving consumers an opportunity to market across the country with the help of a lawyer. So this is all about trying to be proactive and looking forward as a real estate lawyer and it gives ev- eryone an opportunity to build our brand and market it." He elaborates on the ben- Ontario Lawyer's Phone Book 2011 Your most complete directory of Ontario lawyers, law firms, judges and courts With more than 1,400 pages of essential legal references, Ontario Lawyer's Phone Book is your best connection to legal services in Ontario. Subscribers can depend on the credibility, accuracy and currency of this directory year after year. 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We can simply maintain the pres- ent course with our skeptical manner and continue rational- izing our declining profession. Or we can embrace the busi- ness case and, with our distinc- tive advantages as lawyers, we can capitalize on them. We can change an industry for the bet- terment of our clients by giving them better advice and saving them money while making our practice more profi table. Th is is a win-win situation for both our clients and us." He adds that "with the in- troduction of the two-lawyer rule, we have been given an incredible competitive advan- tage because a transfer of land cannot be eff ected unless two lawyers are involved." As a result, the real estate bar has much to look forward to in terms of involvement, client services, and fees, he says. LT For a 30-day, no-risk evaluation call: 1.800.565.6967 Canada Law Book, A Thomson Reuters business. 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