Title Security in British Columbia
BC's land titles are secure:
- Our land title system is regarded as among the very best in the world. Land purchasers, sellers and owners can rest assured that their rights and interests are protected, and that there is no pattern of increased title fraud.
- Registered title offers assured ownership and allows for simple, quick and inexpensive land transfers.
- We have an Assurance Fund available to compensate property owners in the very unlikely case that they are financially affected by a title registration error or become the innocent victim of title fraud.
- At the end of 2008, there were approximately 1.9 million active titles in BC. In the past 19 years, the land title system processed nearly 15 million transactions - yet only three claims related to land ownership fraud and only 14 fraud claims related to lesser interests in land such as discharges of mortgage were paid from the Assurance Fund.
Torrens Principles
Land title in BC operates under a system which is based on the principles of the 'Torrens' registry system. Sir Robert Torrens was an Australian politician and civil servant who in the 1850s was unhappy with the current land conveyancing system. Based on his experience in registering the ownership of ocean vessels, he devised a method of making land registration conclusive. The Colony of Vancouver Island adopted a Torrens system of land title registration in 1861, the second jurisdiction in the world to do so. The Torrens system is now used by countries around the world.
Only a person registered as owner has the right to transfer or otherwise deal with their land title. Registered title also allows for simple, quick and inexpensive land transfers.
Assured Title
Under the Torrens system, legal ownership of land can only be changed by the act of registration on a public register, and the issuance of a 'Certificate of Indefeasible Title'. A title that is indefeasible cannot be defeated, revoked or made void. The person who has a title has a right, good against the world, to the land. Evidence of the right to land is constituted by an indefeasible title which includes the name of the owner and a listing of any mortgages, agreements for sale, leases, easements, covenants, rights-of-way or other registered charges which may pertain to the title. There are a limited number of exceptions to the principle of indefeasibility which are set out in the Land Title Act, the statute which governs BC's land title system.
The strength of the BC system is that it eliminates the need for exhaustive and expensive searches back through the historical chain of ownership to prove that a title is valid and unencumbered. A prospective purchaser need only examine the current title to obtain a full list and description of all interests that affect the title.
Assurance
Registered titles are 'assured'. This protection is offered by the Land Title Act which provides that, should an individual suffer a loss of their title as a result of administrative error or fraud, compensation will be paid. A special Assurance Fund is maintained for this purpose, even though it is very seldom drawn upon. In the past 19 years in BC, there have been nearly 15 million land title transactions with 75 claims paid from the land title Assurance Fund, and only three related to title fraud.
The public is able to rely confidently upon the records of the Land Title Office. Once a title is registered, it cannot be overturned so long as the owner acquired his or her interest in good faith and for valuable consideration.
Identity Theft
As with any area of commerce, there may be people who want to misrepresent ownership of an item, such as land. Identity theft is a concern these days and people should always ask for identification when dealing with any individual with regard to land title to ensure that they are dealing with the true owner of the land. Lawyers and notaries check their clients' identities before submitting documents to the LTSA. FINTRAC rules require real estate brokers and agents to verify their clients' identities following specific guidelines, and to keep a client information record for every purchase or sale of real estate. If some parties in a real estate transaction are not represented by a real estate broker, the broker/agent will need to verify those parties' identities. Financial institutions are also required to verify their clients' identities for certain transactions following specific FINTRAC guidelines.
Mortgage Fraud
In April 2009, the BC Court of Appeal held that unless a mortgage is granted by the true owner of a property, the mortgage is invalid and the owner's title will be returned to its original state. The decision provided clarity about a registered owner's security of title to land.
Steps an Owner Can Take for Additional Peace of Mind
If you still feel that your title is at risk, there are a number of steps you can take.
- Through your lawyer or notary or independent land title registry agent, you can use the LTSA's (or the Land Title Act's) Activity Advisory Service accessed through BC OnLine. This service will provide an e-mail notice to the lawyer, notary or registry agent when an application is made that may affect your title.
- Registry agents can conduct title searches for homeowners wishing to check the status of their titles.
- Alternatively, if your title to your land does not have a mortgage or agreement for sale registered against it, for a fee you can apply for a Duplicate Certificate of Title through your lawyer or notary, or at a Land Title Office. No sale, transfer, mortgage or agreement for sale can be registered while the owner holds that duplicate certificate. If you do obtain your Duplicate Certificate of Title, caution should be used to ensure it is kept safely. A lost or destroyed duplicate title is expensive and time-consuming to replace, and without it you cannot sell your property, make an agreement for sale, or arrange a mortgage. More detailed information on obtaining a Duplicate Certificate can be found here.
- If you only want to have a copy of your title for your personal records, for a fee your lawyer, notary, or registry agent can apply for a State of Title Certificate, which is a certified true copy of your title. More detailed information on obtaining a State of Title Certificate can be found here.
- For a less formal printout of your title, you may obtain a computer-generated 'title search print' from the Land Title Office for a nominal fee.
Continuous Improvement
The LTSA is responsible for managing the land title system in a manner that protects and maintains the security of land ownership records and documents. BC's land title system includes numerous checks and balances to identify and prevent fraud. We constantly monitor the land title system to make sure it meets current needs. We work closely with the Law Society of British Columbia, Society of Notaries Public of British Columbia, the Association of British Columbia Land Surveyors, lenders, and real estate professionals to ensure that the system remains secure, fair and cost-effective for users.
For more information on title security and the specific steps that property owners can take to protect themselves against identity theft and title fraud, please read:
