Conveyancing

How BC law treats it

BC has no licensed conveyancers. Conveyancing is done by lawyers, regulated by the Law Society of British Columbia, and by notaries public, regulated by the Society of Notaries Public of BC. The Land Title and Survey Authority (LTSA) runs the land title registry under the Land Title Act, but it does not regulate the people who do the work. BC uses a Torrens system. The register, not a chain of deeds, shows who owns land, and an indefeasible title is created on registration. A purchaser's lawyer or notary searches title, reviews charges such as mortgages, easements, statutory rights of way and covenants, and arranges for the seller's financial charges to be discharged. On completion day the transfer (Form A) and any new mortgage (Form B) are filed electronically, and funds are released between the lawyers and notaries on trust undertakings once registration is pending. Property transfer tax is payable under the Property Transfer Tax Act when the transfer is registered, based on fair market value, and a return is filed with the transfer. Commercial property sales may also attract GST under the federal Excise Tax Act, which a registrant purchaser often self-assesses. Under the Land Owner Transparency Act, a corporation, trustee or partnership that applies to register an interest in BC land must file a transparency report with the LTSA identifying the individuals who hold an interest in or control the purchaser. This report is separate from a BC company's own transparency register under the BCBCA.

What it means for your business

Buying or selling commercial property, a warehouse or a strata unit for the business depends on clean title and a properly timed completion. Missed charges, an unpaid builders lien, a wrong transfer tax figure or a missing transparency report can delay registration, cost money at closing, or leave the buyer with a title problem it has to fix later. Buying in a holding company changes the filings and tax analysis, so the structure should be settled before the contract of purchase and sale is signed. Example: A Burnaby holding company buys an industrial strata unit. Its lawyer searches title, obtains the strata documents, files the Form A transfer, the property transfer tax return and the company's transparency report, and releases the purchase funds to the seller's lawyer once registration is pending.

Risks and common mistakes

Signing a contract of purchase and sale with no subject clauses for financing, due diligence or title review. Assuming the LTSA checks the deal or protects the buyer, when its role is limited to running the registry. Forgetting that a corporate or trust purchaser must file a Land Owner Transparency Act report. Overlooking GST on a commercial purchase or failing to confirm the GST status of the seller and buyer. Taking title in an individual's name and later trying to move it into a company, which can trigger a second round of property transfer tax.