Legal Brief for November, 2022

Barnacles On Your Title

A residential sale transaction often brings to the surface legal issues affecting the property or the title that the owner may have forgotten about many years before or may never have been aware of.  A common example of this is when a third party such as a lender or creditor has registered a mortgage or lien against the title that the homeowner has long since paid out but has never been discharged from the title at the Land Titles Office.  Like barnacles that accumulate on the underside of a sail boat these registrations against a title can often be an irritating and exasperating matter to deal with when it comes time to sell the property.

I am currently dealing with a property where the Government of Alberta registered a lien against the property (by way of a document known as a Caveat) in 1968, which was just a few years after my client purchased the property.  Some fifty years later my now elderly client has no recollection of why the Caveat was registered, and no documents in regards to it.  The Caveat itself appears to have been wrongfully registered on the title because it refers to a lien on a totally separate property that was owned at the time by my client.  How this passed muster at the Land Titles Office at the time is a great mystery to me.

In any event, it is now a requirement that we have this Caveat discharged from the title as part of the sale process to the purchaser.  There are a couple of procedures available under the Land Titles Act that can be used to have the Caveat removed.  The unfortunate part is that one of the procedures involves making an application to the Court of King's Bench (as the court is now known) for an Order directing that the Caveat be removed from the title.  This will significantly increase the legal costs that the homeowner will incur to complete the sale.

There are two ways that a landowner can try to protect themselves against a situation like this.  The first is to be very diligent about staying aware of what is registered against your title, and making sure that you follow up with any outside parties as the years go by to make sure that their documents are discharged from the title after whatever arrangements you have with them are completed.  Unfortunately many owners simply pay no attention to such matters and many years can go by with something still on the title which should have been discharged.

The second option is to do your own title searches on a regular basis to review what is on your title.  I have a client who now has me obtain on a yearly basis a copy of his title from the Land Titles Office so that we can mutually review the state of his title and take any action that might be appropriate.  You can do this yourself by going into any private registry office and paying the $10.00 fee charged by the Land Titles Office and whatever small handling fee the registry office might charge.

Being proactive in these situations can save you a lot of money and trouble when the time does come to sell your home.