Law Times

Law Times • January 19, 2009 FOCUS Transactions to become simpler M BY DARYL-LYNN CARLSON For Law Times oves are afoot to make residential real estate transactions more ex- peditious and efficient. Last summer, new rules intro- duced by Ontario's Tarion Warran- ty Corp. came into effect affirming more rights for homebuyers, em- powering them to receive compen- sation or even terminate an agree- ment of purchase if the closing date had not been met for reasons other than unavoidable delays. Previously, builders were in the driver's seat in terms of setting conditions for date of completion of construction and occupancy, leaving new home purchasers sometimes in the lurch. Although there is still accommodation for builders to legally extend a clos- ing date, the Tarion rules set out clear timelines for possible exten- sions in the new rules document. Tarion has also included its rules for condominiums, which consequently has an impact on construction projects worth sig- nificant amounts of money. The new Tarion rules will be the subject of an Ontario Bar Association real property, con- tinuing education session on Monday, Feb. 2. The session will focus on new developments in condominium law including discussion on the new Tarion rules led by Tim Schumacher, vice president and general coun- sel of Tarion Warranty Corp. The Tarion rules pertaining to condominiums could gener- ate some discussion in terms of determining if a condominium purchase is subject to the old rules or new ones, which de- pends on the sale date. The session will also include an overview of condominium case law from across Canada, the top 10 pitfalls of purchasing new or existing units that law- yers ought to avoid, and devel- opments in insurance. Perhaps most significantly, it will wrap up with the release of a new Ontario standard closing document for residential sales that has been drafted over the past year by the Working Group on Lawyers and Real Estate. The Working Group's eight executive members are comprised of repre- sentatives from the County and District Law Presidents' Asso- ciation, the Ontario Real Estate Lawyers Association, and the OBA. It was formed in response to proposed lender outsourcing, which threatened to usurp the role of lawyers involved in real estate transactions. Another recent development affecting real estate practices was the province's Bill 152 that ren- ders it mandatory for parties to be represented by lawyers in a real estate deal, which came into effect last year. "Certainly in Ontario there have been some new things that affect real estate practitioners," remarks Tim Kennedy, who prac- tises condominium, real estate, and development law at Nelligan O'Brien Payne LLP in Ottawa and will preside as chairman of the February OBA Institute session. He is particularly ethused about the new standard cloing document that will enable lawyers to save time and simplify deals for their clients. Kennedy notes that to date, several regions throughout the province have taken their own initiatives to standardize their local real estate transaction documents for residential sales (which includes condominiums) such as the bars in Cambridge, Barrie, Hamilton, and Ottawa. But it will be practical to have one standard document that can be used province-wide, he says. "Ottawa has a standard clos- ing document it's been using for some time and it's certainly been a very efficient way of dealing with a generic transaction," says Kenne- dy. He points out that most resi- dential transaction documents are based on standard forms produced by the Ontario Real Estate Associ- ation, although lawyers have made changes based on their individual needs and demographics. The Working Group launched an initiative to garner feedback to determine different provisions, terms, and requirements lawyers were including in their trans- action documents in order to develop a standardized version. "If everybody's using that (OREA documents) or a similar version, then theoretically your rights are all the same so why Get Our Environmental Get Our Environmental w Specialistson Your Team! We help you help your clients. Call us. Law Specialists*on Your Team! Our team of environmental lawyers includes 5 Environmental Law Specialists* PAGE 11 not use a standard document? It will certainly reduce time re- quirements and negotiations for lawyers," says Kennedy. It also stands to simplify matters for clients too, which establishes a win-win for everybody involved. While a proposed draft of the new Ontario standard closing doc- ument will be released at the OBA Institute session, the Working Group will be seeking out feedback on its content over the spring. It's expected a final version, based on the reception the Work- ing Group receives, will be released across the province in April. Jeffrey Schwartz, of Schwartz & Schwartz in Toronto and chairman 'Certainly in Ontario there have been some new things that affect real estate practitioners,' says Tim Kennedy. of the OBA real property section, affirms a standard document for typical residential transactions is a welcome development. 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