1

1) Sources of Propertya) Aboriginal Legal Traditions

Richard Overstall "Encountering the Spirit in the Land: 'property' in a Kinship-Based Legal order- Connection between the land and the chief – respect

o Chief responsible for ensuring all the people in his House respect the spirit in the land and in all living thingso So, legal title, but conveys responsibilities who holds land for the peoples w/ equitable interest in the land o Territorial boundaries usually outlined by territorial features (e.g., river, watershed, etc.)o Responsibility for a transgression of a boundary falls on the COMMUNITY opposed to just the individual

(liability is assumed by the group)

Daxgyet- marriage of particular lineage to a particular territory

"ownership of territory is a marriage of the Chief and the land. Each Chief has an ancestor who encountered and acknowledged the life of the land. From such encounters came power. The land, the plants, the animals and the people all have spirit - they must who respect. That is the basis of our law."

Chief responsible for ensuring that all people in his House respect the spirit in the land and in all living things. When a chief directs his House property and the laws are followed, then that original power can be recreated. That is the source of the Chief's authority." [88]

Adaawk –statement of ownership = stories, songs, etc. of pplThe people who have forgotten their history means they lost their ownership over the land

Yukw - (feast) legal form from which public statements are made about claims to ownership and territory (witnessed and recognized or not)94 - jurisdiction is exercised through the feast

Withdraw of support will occur at the feast - that is, the person will not be acknowledged; those who continue to offend that laws and morality will befall on the extended familyDECENTRALIZED DECISION MAKING

Wilp - principle point of authority in Gitxsan society = House (opposed to democracy for example)Difficulty in negotiations is that you have Chiefs representing houses (principle point of authority) bargaining with the state

- Principle point of legal authority

Clans - Wolf, Frog, Eagle, Fireweek - an amalgamation of Houses; the four clans correspond to the clans of neighboring communitiesProvide points of intersection between first nationsCan't marry within your clan Matrilineal societies inherit the land through mother

- But while your father is alive you have rights of access to your fathers clan

CONCLUSION:Primary laws - reciprocity, respect and balanceSecondary laws - rules that enable people to interpret the primary laws (rules governing the feast hall)Strict Laws - laws that establish the basic relationships between clans -> constitutional in nature, being concerned with establishing and maintaining the legal framework of the society and its ability to maintain its obligations to the landGitxsan property requires inclusivity - idea of property arises only out of reciprocal interactionWestern property requires exclusivity - right to exclude = property Debate as to whether property has any coherence Property is about relationships between people in relation to things Property and possession are not the same thing

o Property: refers to a set of norms, endorsed by the state Property contains in it, some kind of institutional structure to enforce the norms

John Borrows: Recovering Canada: The Resurgence of Indigenous LawExercise in translation - attempt to make Indigenous legal tradition intelligible to non-indigenous Issue: do Nanabush's actions violate balance req by law btw humans & animals? Can't determine w/out other stories (laws)

Crow's vs. Humans after deer went to crow territory: battle; deer say they want to be there b/c they don't have respect This becomes a recognizable legal form - treaty - agreement between parties with legal jurisdiction

Facts: Nanabush is the trickster - metaphor for common law (shape shifter); elders stress intersection of relationships bwt natural & human world (elders as source of authority)Decision: Nanabush's actions have violated the treaty with the deer (Reciprocity is a big theme here) Nbush: deer was vein - like the birch tree who was whipped by the pine tree for being vein doesn't apply in this context

2

Take this as a way of structuring the idea of property between people and the natural world (culturally constructed construct)

b) English Common LawJ.Cribbet & C.W. Johnson, Principles of the Law of Property- The history of English law of property over the last 1000 years reveals a tension between:

o Land a source of social stability & hierarchy, as the principal device for reproducing a particular social ordero Land as a commodity, fungible and alienable at will, as part of a market economy

2 Concepts at the heart of property law1. Tenure - describes the 'quality' of the interest in land

a. Defines the nature of the vertical relationships2. Estates - describes the 'quantity' of the interest in the land

What does it mean to hold an interest in the land? Feudalism - both a system of government and a method of holding property

o A state of society in which the main social bond is between lord and the man, a relation implying on the lord's part protection and defence; and on the man's part protection, service, and reverence, the service including service in arms. This personal relationship is inseparably invoked in a propriety relation, the tenure relationship

o Presupposition that ALL INTERESTS IN LAND DEVOLVE FROM INTEREST FROM CROWN Most commentaries on this subject start with William the Conqueror

Three points to reinforce about Feudalism: personal relationship between lord and tenant1. Land held 'of the Crown', or 'of a lord'; not owned outright. No absolute or 'allodial' title to the land2. Free Tenure: know in advance what you have to do to get the land (e.g., knight service)

a) Knight service - 40 days of armed service; most prestigious b) Splendor - professions which include trades (serjeantry) in exchange for their personal services to the king

(e.g., butchers, smiths)c) Spirit - Religious tenure - Frankalmoind) Subsistence - free and common socage - land held in exchange for agriculture; was a category that did not

fall w/in other; eventually becomes most common and only tenurei. Statutes of Tenures, 1660 - all non-religious free tenure except for socage abolished ; only kind

that made it to Canada Seisin - someone who had rights and responsibilities in relation to land - became a public spectacle, establishing the

transfer of an interest in the land

Incidents of tenure - for a time, these were the principle sources of revenue for the crown Homage and fealty : Promise to be loyal to the lord - sometimes requires fees Aids : Financial support to the lord on specific occasions Fines : Triggered monetary payment to lord Relief and primer Seisin : Pass to heir, but must pay fees Wardship : If transfer was to a minor - fee incurred Marriage : By lord or by tenant - more fees Customary Dues   Escheat and Forfeiture : e.g., when you were treasonous you forfeit your title to land

A. Law and Equity Act, R.S.B.C. 1996, c. 253 (s.2)

Doctrine of Reception 1) Settled (no pre-existing law) English law gets transferred (so long as applicable in circumstances) or 2) If conquered (existing law in place) they use the already existing law (can be overturned by legislation; e.g., Quebec)

Escheat:o The only instance of tenure that remains relevant today - Statute of Wills, 1540 (gave tenants the right to distribute their

property to whomever they wished upon death); o Intestacy: if you die without a will, the state takes over and divides your property accordingly

If no one close enough to get the property, the property escheats to the crown

B. Escheat Act - section 1

3

2) Justifications for Property

C. Lewis : “The Right to Private Property in a New Political Dispensation in South Africa” 1992

a) Economic Efficiency- Private Property is best able to respond and allocate resources, incentive to preserve, costs = benefits- Common property: costs are too spread, does not capture externalities- 3 characteristics for PP to maximize efficiency:

a)Defined rights, enforceable exclusive rights (clear boundaries)b)Transferabilityc)Universality

~ Exclusivity, transferability, & universality Capital cannot be put to work because they need a registration system where private property interests can

be represented and then transferred (e.g., mortgage transfer) Argument goes, these economic systems are crucial to the development to the West Possibility of development of resources Connection between private property and the state (e.g., taxation, job force training) Motives of people pushing for private property: job shortages (training via high school education) Picking up on the theory that private ownership is a source of stability

b) Promotion of FreedomAristotle; idea that amongst civil and property rights requires individual to be independent. All other rights flow from this right PP = fundamental right, provides platform for participation in free + democratic society

c) PersonhoodHegel; humans are containers of free will with the opportunity to exercise this free will . This requires some use of the physical world - us exercising our free will over materials gives us meaning in the worldo Some things (e.g., wedding ring, home vs. shopping mall), are more important to some people more than

others We only become human when we exercise our free will

d) LabourLocke; property arises by mixing ones labour with the material world which gives rise to a property interest - this power precedes the social contractWe claim from commons (effort/labour) to create our own property Property interest precedes the state

e) UtilitarianBentham; maximize happiness, this can come from private property (i.e., wealth)

f) Discovery/Occupation/PossessionGives right to a property interest. The discoverer has a better claim than someone who has notBest one of these, have a property claim

4

3) Types of PropertyTypology of Property System

State/Public Property State or its agencies have the right to determine the rules of access and use, but a duty to manage publicly owned resources for public welfare. Individual members of the public do not necessarily have a right of access or use but they have a duty to observe access and use rules promulgated by controlling/managing agency

Private Property Owners have the exclusive righto undertake socially acceptable uses to the exclusion of non-owners, and have a duty to refrain from unacceptable uses. Non-owners have a duty to refrain from preventing owners’ socially acceptable uses, but have the right to prevent or be compensated for socially unacceptable uses

Common Property Each member of the ownership group has the right to access and use group-owned resource in accordance with access and use rules established collectively by the group, and a duty not to violate access and use rules. Each member also has the right to exclude non-members of the ownership group, but no right to exclude other members of the ownership group.

Nonproperty/open access No individual has a duty to refrain from accessing and using a resource. No individual or group has the right to prevent any other individual or group from accessing and using the resource as they choose

R.Chambers - difference between real and personal property1. About relationships btwn ppl w/ respect to things2. Tangible/intangible resources3. Property ≠ possession; property = an enforceable claim against others4. Freehold estates = things that are owned5. Leasehold estates = things possessed on lease6. Institutional authority to enforce7. * Right to exclude (point of contention)

a. Single variable essentialism Right to exclude = necessary and sufficient to define prop rights claim

b. Multi variable essentialism Right to exclude = necessary but not sufficient (also need further bundle of rights)

c. Nominalism Property = matter of social convention Right to exclude = neither necessary nor sufficient

a) Yanner v. Eaton 1999Interpretation of Queensland Fauna ActFacts: Licence to harvest game = necessary; Yanner ≠ licence killed 2 crocsLaw: Native Title Act protects rights of aboriginal Australians despite general laws

Under Ausi Law pre-existing native title can be removed by Queen’s grant of property right if inconsistent All fauna = property of the crown Grant of property extinguish native title claim?

1) Gleeson (Nominalism- property=empty vessel) -Not full, beneficial/absolute ownership

1. Can’t be defined (migratory birds), indeterminacy2. Common law, no abs ownership of wild animals3. Purpose = royalty

4. Not alike domestic animal2) McHugh (dissent)

-Right to exclude = necessary (single/multi variable)-Ordinary meaning (as opposed to statutory intent)

b) Harrison v.Carswell 1976Facts: picketing in parking lot; asked to leave; invited community to come in?Issues: Mechanical deference to stare decisis? Can property right to exclude extend to places where community invited?Dickson : Must distinguish case if we want to overturn (Peters Case – Can mall owner use trespass to evict picketer? –yesCannot distinguish, therefore bound by this decisionRole of Courts: apply law reasonably and objectively – judges never wholly free; this issue is better dealt with by ActLaskin : d istinguishes boycott vs strike – not like private property; No challenge to title, possession or privacyThis level of protection should not apply to a shopping mall (whole business model is to invite everyone in)Labour disputes should be a limit on mall owner’s ability to sue for trespass – Employees’ rights trump owners’ rightsRatios: The common law protects private property rights unconditionally unless there is an overriding statute.

- The owner of a shopping mall has sufficient control and possession of the common areas to invoke the remedies of trespass - Owner who has granted general right of entry can still withdraw it from particular members of public, can invoke remedy of

trespass (Ont. CA) control (SCC)

5

4) Novel Claims to Propertya) International News Service v. Associated Press (1918)

Facts: Newspapers competing; AP seeking injunction b/c: INS bribing AP employees; Inducing breach of bylawsIssues: Is there property in published news? Right to exclude? – Yes, Form of expression may be protected by copyright, but ideas themselves (news) have no property once published BUT may be property interest btwn competitors “quasi-property”

~ news = all attributes of property necessary to make it unfair business practice for competition to profit from complainant’s labour

Reasoning: has all the attributes of property (that is, used its resources to implement property rights); precisely at the point that profit is to be reaped - Theory of Consideration This labour is socially valuable, in that we would cut off the value in this - ECONOMIC ARGUMENT

DISSENT: Holmes Property doesn't arise from value, although exchangeable. This does not mean you can prohibit the activities of others

which would diminish the value Property is a legal construct - property and law are born together and die together - Jeremy Bentham Property is protecting the individual’s right to exclude (which Associated press is seeking)

Brandeis If property is private, the right to exclude is absolute, if public, the right is qualified

o The fact that a product of mind has cost its producer money and labour, and has a value for which others are willing to pay, is not sufficient to ensure to it this legal attribute of property

Ratios: Quasi- property: a property interest that applies only to certain parties (not the world), i.e., btw the two competitors Principles of property play an imperative role in judicial decisions

b) Victoria Park Racing And Recreation Grounds Ltd. v Taylor (1934)Facts: Fence around the grounds; D erects platform so can see racetrack; communicate to off track betting locations (reducing the amount of betting that was happening on the track)Issues: Does reducing the value of something legitimize property rights ? Nuisance? Does Victoria park have a claim in property (via the right to exclude)? Does Victoria have property in "spectacle"? Reasonable enjoyment by D? – No, Injunction deniedReasoning: Created something of value, value reduced by D - fact that damage occurs does not give rise to action(Rich; Majority) Unprecedented form of nuisance ≠ nuisance; (Dixon: Diss): Apply princ of nuisance to new facts nuisanceNo authority/case law for finding property in spectacle. Spectacle remains common property, cant be owned (dissent INS v. AP)Ratios: no property in a spectacle; Nuisance: a tort in which the actions of one party prevents or limits (indirectly or directly) enjoyment ability of the landNB: Broadcasting does have a Quasi-property interest, was possible to convey this case in the same way

c) Moore v. The Regents of the University of California 1990Facts: Treatment; used cells to patent cell line;Issues: 1) Dr in breach of fidutiary duty to patient? – Yes, no informed consent 2) Conversion (wrongful appropriations of someone’s property)

a. Were the cells Moore’s property? If no, should the law be extended to include cells?Conversion IssueA) Majority:

a. No precedent in existing property in existing cells; b. California statute says removed body parts should be disposed ofc. Cell line is distinct from the cells (and protected by patent)

B) Dissent: a. No precedent against existing property in existing cells either b. Property = bundle of rights just b/c lost some control ≠ lost all rightsc. Patent comes after the prior prop interest patent does not applyShould law of conversion be extended? ~ Majority NO. Dissent YES.

A) Majority:a. Economic efficiency justification : if recognize prop int. in patient, not conducive to research in general (public interest) b. Not role of the courts (legislature) c. Plenty of remedies available to breach of fiduciary duty

B) Dissent:a. Surely researchers can get consent this would not be a problem b. Moral considerations (ie- bodily integrity) trump economic/public policy considerations c. Unjust enrichment

Ratios: Humans can be the subjects of property, but not the objects of property

6

5) Property, Class, and PovertyJ.Waldron - Homelessness and the Issue of Freedom- One of the roles of property law is being able to say who can do what where - right to exclusion- Everything has to happen somewhere, and if not allowed anywhere, not free (to be human)RC Ellickson "Controlling chronic Misconduct in City spaces

-Starting point: public spaces are important; it would be impossible to make all the transactions we need without public property: one needs the movement through space

-Tragedy of the Agora: Spaces where democracy flourishes (discussions, protests, etc.) important for everyone, BUT-Safety = important & circumstances which facilitate security will be diff for diff peopleChronic Street Nuisance: drives people away, and out of spaces, Proposal: divide city into RED, YELLOW and GREEN zones.

a) Victoria City v Adams 2008Facts: Tent city; Victoria bylaw prevents protecting shelter; City seeking injunction on tent city; argued violation of their s.7 Charter right of "life, liberty, and security of person"; Subject to s.1 - "the enumerated rights are subject to such limits as can be demonstrably justified in a free and democratic society"; no protection for public property; Take up a temporary abridge overnight = MATTER AT ISSUE; facts of homelessness entered as evidence for the tent-city occupantsIssues: Conflict btw need of homeless to perform essential acts to live VS having orderly, nice parksDecision: The bylaws enacted by the city violate s.7 of the charter and therefore have no force or effectReasoning: Current housing does not meet the needs of the homeless; City cannot manage its own property in a manner that interferes with their ability to keep themselves safe % warm; Proportionality test failsRatio(s): The notion that common property is a space to use temporarily is socially constructed (doesn't mean it's wrong or right, just that this is the way we've shaped it)

6)Protections For Property

C. Expropriation Act, ss. 1, 4(2), 6(1), 10(2), 14, 18, 30(1), 31(1)

Common Law: Strict interpretation in terms of statutes proportion to take property Must be clear and plain statute (cannot be done by implication) Any ambiguity will be interpreted in favour of the property owner

Statutory protection Canadian Bill of Rights (1960) "… the right of the individual to life, liberty, security of the person and enjoyment of property, and the right not to be

deprived thereof except by due process of law" Not subject to constitutional protection - only applies to fed law, not that of the provinces As an ordinary statute, it can come into conflict with other statutes Applies only to human individuals and not to other entities

Charter of Rights and Freedoms s.7 Everyone has the right to life, liberty, and security of the person and the right not to be deprived thereof except in

accordance with the principles of fundamental justice s.8 Everyone has the right to be secure against unreasonable search and seizure

o Interpreted not as a protection for property but things close to one personConstitutional protections (outside the charter which ends at 33) s.35 The existing aboriginal/treaty rights of aboriginal peoples are hereby recognized and affirmed Conservative Party Platform 2006: propose amendment to constitution for property rights United State Constitution 5th Amendment (1971): No person shall be held to answer for a capital, or otherwise

infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; Nor shall private property be taken for public use, without just compensation Strange because it attempts to protect property when it takes it away

South African Constitution Section 8, 7, 5, 4 redistribution; arguably all protect private property Personhood - attempt to eradicate poverty, in the spirit of anti-apartheid, the control over one's land allows you to

achieve meaning through property once more Economic argument (protection) Utilitarianism - human happiness and economics (redistribution)

7

a) Susette Kelo v. City of New London, Connecticut 2005 US (Public Use)Facts: Wanted to make industrial zone for people: this involved expropriation of Ms. Kelo's house

o Argued that this was transfer of private to private and NOT public use (this is against the American constitution)Issues: Does this constitute an expropriation of the land? No, for public use corporation could take the land

b) Pennsylvania Coal Co. v. Mahon 1992 USFacts: Act of Pennsylvania; forbids the mining of anthracite coal in such a way to cause the subsidence of, among other things, any structure used as human habitation, w/ exceptions: land where surface is owned by the owner of the underlying coal and is distant more than 150 feet; Deed conveys the surface, but, in express terms, reserves the right to remove the coal under the same, and the grantee takes the premises with the risk, and waives all claim damages that may arise form mining out the coalIssues: Whether the police power to expropriate was stretched too far? – No, not a takingReasoning: The right to compensate is only triggered by a taking of propertyRatio(s): Doctrine of Regulatory Taking: Property may be regulated to a degree, goes too far = taking

c) Lucas v. South Carolina Coastal Council 1992 US – Regulatory TakingTrying to establish what constitutes "too far"Facts: Lucas purchased two coast lots; Local council designates lands as unavailable for developmentIssues: What will constitute a taking in spite of the reasons for the public good?Decision: The legislative measure was a takingRatio(s): Two discrete categories of regulatory action = compensable w/out inquiry into public interest 1. If regulatory prevention causes sufferer to have a personal invasion (trespass) - compensation awarded2. If regulatory prevention denies all economically beneficial or productive use of the land

State has capacity to pass laws setting limits equivalent to the tort of nuisance, but anything beyond this requires confiscation

d) Mariner Real Estate Ltd. v. Nova Scotia (AG) 1999 – De Facto ExpropriationFacts: Preserve beach dune system as "environmental and recreational resource" - Beaches Act Issues: Whether the regulatory action was lawful and whether the Expropriation act entitles the owner to compensation for the resulting restrictions? – Yes, did not amount to a complete loss of use in the landReasoning: Regulation of land which has the effect of decreasing the value of the land is not expropriation; Loss of value is not loss of property - court turns to established law (three principle cases)

1. British Columbia v. Tener case Land in park, respondent (Tener) was an owner of the mineral claim (1937), park created 1939). 1973, the park labelled "class a provincial park": prohibits resource extraction; 1978 - no further exploration allowed Respondent claims that they are entitled to approx. $4 million because the act amounted to a taking of their property Supreme court decides that the company is entitled to compensation

2. Casimiro Resource Corp3. Manitoba Fisheries v. The Queen: property int in good will; Compensate for equipment and surprise but not loss of good will Ratio(s): De facto expropriation: taking of property interest: removes all economic value & benefits of ownershipIn order for there to be expropriation you need two things:

1. Confiscation of all reasonable private uses (not value) –loss of value is not loss of property2. The expropriation body must be acquiring a benefit to the expropriating authority

Burden on the person making the claim that all incidents of ownership have, in effect, been taken away

e) Canadian Pacific Railway v. City of Vancouver 2006Facts: Arbutus Corridor Official Development Plan By-law - designated the corridor as public via fare for transportation & "greenways”; Effect was to freeze redevelopment potential of corridor & confine CPR to uneconomic uses of the land; CPR argued that: they can no longer do anything economically viableIssues: Does the fact that CPR cannot use the land for an economic purpose constitute a taking? – No, not de facto expropriation b/c CPR has not been deprived of all reasonable uses (could still run train) and the city did not gain anything Ratio(s): A regulation that removes economic purposes only does not constitute a takingConfirmed the Mariner test as good law for de facto expropriation ~ The test is not economic, it is about use, not valueNB: still belongs to CPR, just not enforcing their right to exclude

D. NAFTA Article 110

8

f) Metalclad Corp v. United Mexican States (2000)Facts: Construction halted by Mexican government: Declare land an ecological preserve; Metalclad takes gov to arbitration panel saying that the ecological decree = expropriation ; Gov: environmental issueIssues: Whether Mexico's action amounts to a taking pursuant to NAFTA Article 110?- yes, ecological decree is not a justification for a taking by the government (indirect expropriation)Reasoning: Gov provided permit to Metalclad and then revoked it in an untimely and discriminatory mannerRatio(s): International agreements have the potential to override government action; Motive = irrelevant

7) Physical Boundariesa) Airspace

Maxim: Cujus est solum ejus est usque ad coelum et ad inferno Whoever owns the soil owns to the heaven's to the earth

i) Kelsen v. Imperial Tobacco 1957Facts: K assumes lease in shop; tall building, & on side of the building an ad board erected sticking out 4 inches from buildingRatios: Not a nuisance because it doesn't interfere with Kelson’s business, but it's a trespass because it's extending into his property (by 4 inches); latin maxim cujus est solum ejusest usque ad coelum et ad inferno NB: prevailing approach today – treat airspace as possessory interest: protect with trespass, not nuisance

ii) Bernstein (Lord of Leigh) v. Skyviews (1978)Ratios: Height which may interfere w/ regular use of land = how high airspace ownership extends Balance the rights of the owner to enjoy the use of his land against the rights of the general public to take advantage of all

that science no offers in the use of air space. Test: compromise rights by defining airspace ownership at the height required for reasonable use and enjoyment of land

(not whether the interferences is permanent/transitory)

iii) Manitoba (Minister of Finance) v. Air Canada 1978Ratios: "air & airspace are not subject of ownership by anyone, State or individual, but into group of res onmuium communis"

E. United Nations Convention on the Law of the Sea

iv) Didow v. Alberta Power Ltd. 1988Facts: D constructed power-line; bases did not touch the property of the P, but power lines above did (6 ft into their airspace)Issues: Does this constitute a Nuisance or Trespass? - TrespassRatios: Landowner entitled to freedom from permanent structures that impinge on actual/potential use/enjoyment of his land.

Latin maxim qualifiedNB: as the text indicates this decision was soon overturned with legislation

Nuisance: indirect interferences w/ enjoyment of property that causes harm Trespass: direct interferences w/ possessory interest (depends on whether it is the persons property –airspace)

F. Land Title Act, s.138, 141 G. Strata Property Act,

Limited Common Property - common property to which the owner of that unit only has access (e.g., balcony's) In addition you're buying into collective governance of the property

Co-ops Social and equity co-ops Provides not a property interest to land (like condominium), but shares in a corporation. Those shares entitle you to a

lease in your unito But there is only one shared property interest owned by the corporationo Members of co-op have the right to set other rules that can discriminate against potential buyers

b) Subsurface

9

Maxim: Cujus est solum, ejus est esque ad coelum ad inferos: whomever the soil belongs, also owns to the sky & to the depths

Law and Economics: Coase Theorem "in the absence of transactions costs, an efficient allocation of resources will result, irrespective of legal rules; that is,

irrespective of which party is assigned the property in a situation of conflicting uses." "If transactions are costless, the initial assignment of a property right will not affect the ultimate use of the property"

Sturges v. Bridgman (1879): Nuisance suit to shut down operations due to noise; If doctor wins - shut down construction, if confectioner wins - continues making noise… doctor will buy out confectioner

if it's worth more to the doctor than if the noise continues

Efficiency - in a transfer from A-->B if there is a surplus to B, then that is more efficientTransactions Costs: Anything that limits the free-flow of resources to most efficient place (e.g., negotiating costs, insufficient market – free riders, hold outs, bilateral monopolies)Endowment effect: put more value on status quo (if you have something, expect more to give it up in the first instance)

i) Edward v. Sims 1929 US

Facts: Edward owns land w/ entrance to caves and develops into tourist attraction; Sims owns property above the caves (but not the entrance); Edward is trying to secure accessIssues: Who owns the caves? – Latin Maxim applies, whoever owns the surfaceReasoning: Previous cases: owner may cross to see if neighbour is invading their propertyDISSENT*: Economic argument: Damages defendant, and P gains nothing because he can't use it (can't find an entrance); Cave should remain with he who owns the entrance First discovery argument - when the owner has discovered a cave and prepared it for purposes of exhibition, no one ought to be allowed to disturb him in his dominion over that which he has conquered and subjected to his usesLabour argument - the cave was his because he had made it what it was, and without what he had done it was nothing of valueRatios: Latin maxim applies to subsurface more than to airspace (the law in Canada has adopted this view) Mining law expands to subsurface claims

NB: Less limits to subsurface rights to airspace (public dimension to airspace cant be given same way to subsurface)

Minerals At common law, the owner of the surface of the land owns all the minerals under the land except gold and silver Conflict comes when persons with mineral rights come into dispute with surface owners

H. Land Act, s.11, s.50

I. Mineral Tenure Act

Barton, Canadian Law of Mining - what counts as a mineral? Intentional test: regard must be had not only to the words used to describe the things reserved, but also to the leading purpose or object that the deed or statute embodies.

“Mines” and “Minerals” are not definite terms: susceptible to limitation or expansion according to the intention with which they are used

Circumstances test: must be exceptional or rare substance (in character, value, or occurrence) Vernacular Test: whether the word is regarded in the ordinary language of miners, commercial people, and landowners (court will assume this meaning)

Definition of mineral is still largely a common law definition

Crown owns 96% of the land

c) Land

10

Area where the law is little involved - that is, it's not an area where statute or common law pays much attention to Becomes increasingly important for the state to know where the boundaries as the state exercises and expands its

boundaries and for the purposes of paying tax Importance of defined property boundaries is evidences by historical development of surveying and central depositories

Adverse Possession: obtain land Owner not using it, person open in public, could acquire property (abolished in BC) Except the limited version by s.36 of the trespass act

i) Robertson v. Wallace 2000Facts: River boundary shifts east; Wallace claims that the boundary shifts, and his property is expanded; Robertson claims new natural river course - property didn't expand; No evidence of express agreement between the parties Issues: had the parties established a conventional line boundary? – No, evidence doesn’t constitute agreement btw partiesRatios: Burden of proof that the line hasn’t shifted on P Accretion (you get the land): if water moves, expanding land gradually over time Avulsion (don’t get land): sudden movement of water (e.g., landslide) Law establishing Conventional Boundary:

a)Doubt b) Parties agree on boundary c) One party relies on boundaryIf all three met, party is stopped from denying the line, BUT if no evidence of express agreement, no established line

Conventional line boundary elements: adjoining land owners, must have dispute or uncertainty about location of dividing line between properties, they must agree on a division line, and the recognise it as a common boundary

Recognition of the line can be through oral, written, or conduct of the partiesJ. Trespass Act, s.1,3,4,5

ii) Blewman v. Wilkinson 1979 (NB: not received widely in Canada)Facts: Excavation occurs; owner sub-divides the land and sells of the lots; soil on one of the lands subsides as part of the excavation; owner of that land sues company and original owner for NATURAL RIGHT TO SUPPORT THEIR PROPERTYIssues: does P have a right to support?Ratios: Support: "right to enjoy land in its natural state" (e.g., if a neighbour is doing something that might cause your land to subside, you have a claim over them as a right to support your land) A land owner simply has to establish that the person caused their land to subside (due diligence not a defence) Cannot claim for new subsidence of old workings if the owners have knowledge of the excavation

Cannot claim support if have knowledge of the risk when purchasing NB: Buildings No absolute right to support of BUILDINGS on the land (just the land itself)- Due diligence (negligence) tests for whether soil subsided due to weight of building or interruption to land support alone

K. Property Act ss.3-5

d) WaterCommon law doctrine Ad medium filum aquae: owner of land adjacent to a body of water also owns the solum (bed) of the body of water to the midpoint- Applied to non-navigable bodies of water (understood in UK to mean non-tidal bodies of water)- Owned both sides of the water - owned the whole bedRiparian Rights: Owner has right to use water in natural flow, but not diminish someone else's right to natural flow (e.g., dam)

L. Water Act [RSBC 1996] M. UN Convention of the Law of the Sea

i) R v. Nikal 1996 CanadaFacts: D caught fishing without a licence (s.4(1) of the British Columbia Fishery Regulations; D claimed licence act did not apply to him b/c infringed his aboriginal rights - s.35(1) of the Constitution; D claimed the river was on the reserve that pertains to the Native by-laws, not Crown's laws; Crown's reach extends only to navigable waters, & non-nav waters belong to reserve Issues: What is the correct test for navigability, and is the Buckley River a navigable river? – 1st NationsRatio(s): Ad medium filum aquae: no application to navigable rivers in BC ; To center thread of water (where it’s not navigable)Public right of navigation exists where water is navigable Once the navigable character of the river is to be established, up to the point at which navigability entirely ceases the

stream must be deemed a public highway (belongs to the Crown) One of the rights that flows from the possession of the river bed is the possession of the fishery The right of fishery is severable from the title

e) Fixtures

11

Fixtures Articles attached to a house or land & considered legally part of it (remain in place when an owner moves).- Mark the boundary between that which is land (real property) and that which is not land (chattel); law of fixtures

developed to identify the point at which chattel becomes landChattel = privately owned things that are moveable

Tenant’s fixtures: Tenant may reclaim an object that is attached to the land if: (NB: right to detach can be limited by contract)1. Purpose was for trade, ornamentation, domestic use, AND2. Can remove without damage (NB: must be done in a timely manner)

CONTRACT OF PURCHASE AND SALE Need : parties, property, price Included items

The intent of the objective intention test (see La Salle below) allows party to see what is meant to be included and what isn't Comes from fear that if the tenant attached something, they'd lose it in the sale of the land

i) La Salle Recreations Ltd. v. Canadian Camdex Investments Ltd. 1969 CanadaFacts: Villa goes bankrupt, sells hotel & carpets to a 3rd party; BUT P claims ownership of the carpets until the loan was paid offIssues: do the carpets constitute a fixture? – Yes, the carpets are fixturesRatios: Land or Chattels Test - 2 parts: Matter of intention - objectively determined

1) THE DEGREE OF ANNEXATION - the extent to which the object is attached to the land- Gives rise to a presumption - stronger the attachment, the stronger the presumption (but presumptions are rebuttable)- Identifies the onus of proof

2) THE OBJECT OF THE ANNEXATION - elicited by the presumption - Was the chattel attached to expand land? Fixture? Used as better use of a chattel as a chattel?- Objective intention test is there so that a 3rd party (not knowing details of agreement) can tell what a feature is- Revolves around degree of attachment - once something becomes sufficiently attached to the land, the ownership

interest lodges with the interest in the land

What was considered to deem this a fixture: Need some sort of surface; Carpets need to be affixed; Carpets are necessary to the completion of the floors ; carpets are replaced in 3-5 years; there is a market for used carpets (all necessary to determination of it is a fixture

ii) Re Davis 1954Facts: Wife had a life interest in 1/3 of her husband’s property; 6 bowling alleys contested Issues: bowling alleys fixtures or chattel? - fixture, for better efficiency of bowling, not improvement to the landReasoning: Bowling alleys attached by bolts and clips, an assumption then arises these are fixtures - strength of presumption = degree of attachment: removal of bowling alleys = easy; Object of annexation? Bowling-alleys not affixed for better use of the building but in order that bowling might be more efficiently carried on -not part of the real estate Ratios: if the object of the affixing of chattels is to improve the freehold, then, even if the chattels are only slightly affixed to the realty, they may well become part of the reality. If, on the other hand, the object of the affixation of the chattels is the better enjoyment of chattels, then the affixation does not make them part of realty

iii) Diamond Neon (Manufacturing) Ltd. v. Toronto-Dominion Realty Co. 1976Facts: Uptown motors leasing a lot + 2 signs on property; signed contract: DN to remain owner of signs (the maker); sign lease transferred to new lessee; sign contract and land contract expire: Lessee vacates but signs remain; Property purchased: became aware after purchase that signs owned by maker still; signs sold by new property owner sign owner sues for conversionIssues: were the signs fixtures or chattels? – became fixture when lease expiredRatios: Items designed specifically to be set upon property in order to improve its usefulness, and that have been affixed permanently, are considered part of that realty, and no longer chattels

f) Tangible and Intangible Resources

12

Property protects original cultural expression:i) Copyright Nothing else is created Accrues automatically and last for long time Does expire (life of artist + 50 years in Canada) Protects econ/moral rights Economic rights: Those rights held by a person or

entity designed to protect economic value/form of expression (right to copy, distribute, perform, derivative works)

Author has right to be associated w/ work Author’s reputation has to do w/ work (author

doesn’t waive control with what’s done w/ work) Moral right: (i.e. Canada Geese v Eaton Center)

ii) Patent Protects scientific or technological invention Includes industrial/scientific Must apply for a patent ($) (100k) ONLY INVOLVES INVENTION Document that describes invention and how one

would make that invention Claiming you’ve invented X, gives you protection

iii) Trademark Brands, goodwill, reputation Designed to protect brand recognition No required registration but additional protection if

you do register

13

i) Theberge v Galerie d’Art du Petit Champlain Inc. 2002 (Copyright)Facts: Art gallery taking prints of paintings, effectively turning paper prints into canvas prints, P seizes goods (only ok if infringement economic right, not moral); D used a chemical process allowing them to life canvas substrate for purposes of resale. D argued that this caused them significant economic lossIssue: violation of economic copyright interests? No, not for creator say what buyer can do w/ an objectRatios: Moral rights: Artist is primarily concerned with protection of reputation Damage to value may lower reputation but doesn’t amount to replication infringing economic rights of copyright holder Waivable, but not assignable (if you give up your rights to buyer, that person doesn’t "take-over" Copyright provides owner with economic & moral right to work Treat artist’s oeuvre as extension of his personality possessing dignity that deserves protection

Economic Rights: The principle economic benefit is profit from work Sole right to produce/reproduce work or any substantial part thereof in any material form This case demonstrates the basic economic conflict between the holder of the intellectual property in a work and the

owner of the tangible property that embodies the copyrighted expressions Cannot assert moral right in the guise of an economic right ; Copyright law purpose: balance New affixation of art does not constitute a reproduction

ii) Monsanto Canada v. Schmeister 2004 (Patent)Facts: Seed company, patent “Roundup Ready” canola in 1976 (20 year lifetime of patent); commercial farming operation grew canola containing patented cell/gene w/out obtaining license of permission. M sells seed + herbicide + charges for a license (must rebuy every year, saving seeds = prohibited) Issue: Was the Patent Act breached? – Genes and cells (not plant/animal itself) can be patented - NB: this case is distinguished because the Harvard Mouse case concerned a mammal.

Ratios: Can’t patent life forms but you can patent building blocks Violate patent if you use a part which is significant part of process Principle: Patent law ought to provide inventor w/ “protection for that which he has actually in good faith invented”;

ensure full use of patent by inventor Had D been more innocent, can refute presumption of use arising from his possession.

iii) Mattel v. 3894307 Canada Inc. 2006 (Trademark)Facts: Barbie's restaurants sought to have its name trade-marked in relation to restaurant services; BARBIE doll company:, arguing trade-mark law prevents other ppl from using name like theirs; Must show the trademark by D = consumer confusion Issues: Whether BARBIE is entitled to trademark protection? No evid for confusion, no TM infringementRatios: If someone dependent on brand name – rights protected, but need to make use of thing or lose it Must be confusion on customer to have infringement : 5 things to determine (Trade Mark Act 1985 - s.6(5))

1) Inherent distinctiveness2) Length of time trademark has been in use (longer, more likely trademark protection)3) Nature of the wares, services or business (same nature, more likely trademark protection)4) Nature of the trade (same or similar nature, more likely trademark protection)5) Degree of resemblance between trademarks in appearance or sound, or in ideas suggested by them

8) Acquisition InterestsOne might possess something, but only becomes a property interest when there is some external capacity (whether state or community) to enforce that property interest) – Labour, First Occupancy Theories (see page 3)Conversion - the wrongful exercise of dominion over the personal property of another. There must be actual interference with the P's dominion. Wrongful withholding of property can constitute actual interference even where the defendant lawfully acquired the property. If a person entitled to possession of personal property demands its return, the unjustified refusal to give the property back is conversion o Must be intentionally done, no requirement that the D knows the property belongs to another

a) The Concept of Possessioni) Popov v. Hayashi 2002

Facts: World record home run hit; P catches ball (no evidence if he fully secured the ball in his possession), but crowd swarms him (unlawfully) & drops ball; D grabs it, and puts it in his pocket (Did nothing unlawful); P asks for ball, D refuses to give it back Issues: Did the P ever have possession of the ball? – Yes, each party has an equal property interest in ballCases: Pearson and Post - fox hunting case - two people killing the fox, third party kills it --- for animals, possession crystallizes when you "catch the animal"; Clift v. Kane - NFL - seal hunt - general rule of capture; Sunken ship rule- salvage labour theory - sailor cannot assert a claim merely by boarding a vessel and publishing a notice, unless such acts are coupled with a then present intention of conducting salvage operationRatio(s): Control & intent must be parallel (both physical control & intent to reduce property to one's possession) in possession

14

Where more than one party has a valid claim to a single piece of property, the court will recognize an undivided interest in the property in proportion to the strength of the claim

Conversion requires possession to be enforced Pre-possessory interest vests P with a qualified right to possession and enables him to advance a legitimate claim to the

baseball based on conversion theory

b) Crown Grants

Crown Grant to HBC, 1821“…we do… give, grant and secure to the said Governor and Company [HBC] … the sole and exclusive privilege, for the full period of 21 years from the date of this our Grant, of trading with the Indians in all such parts of North America as aforesaid…” “Governor and Company shall establish upon said island settlement or resident colonists Contemporary Crown Grants(s.50 Land Act) "Crown Grants"

Crown can make a grant of land but there is a list of qualifications (e.g., Crown can take back 1/20th of the land, extract resources, water privileges)

H. Land Act s.50 (NB: you can get these things from other acts, however)

c) Inter Vivos TransferInter vivos transfer (purchase) 3 stages : 1. Contract/gift conferring interest (contract of purchase and sale: date when parties bind themselves)2. Transfer of Interest "completion date" (Contract itself is a transferring interest; subject to legislation see below) 3. Registration (if a title registration system)

N. Law and Equity Act, s.59 The writing can be done at any time to indicate a contract

Standard Form of contract of purchase of sale: Parties, Property, Price

Sale for the property and title must be in writing (need 3 "P's" - parties, property, price) In equity, the courts would sometimes allow for an unwritten contract to be binding

O. Property Law Act s 15

Deeds: Written instrument, signed, sealed, delivered, whereby an interest passes Signed : By the transferor (the one transferring interest in land) Sealed : Indicates the gravity of the importance in the transfer - authenticity, security No longer required (Property Act s.16(1)) Delivered : What amounts to the delivery of the deed (Intention to be delivered and bound by the grant )

Form A – freehold transfer – gives you form so you know it will be registered properly Gifts: Intention to donate, acceptance (of receiver), delivery (intention to deliver, not necessarily physical delivery itself)

9) Common Law Estates2 doctrines of property

1) Tenure (the quality of the property interest) 2) Estates (the quantity of the interest)Freehold Estates: Uncertain duration, but also have a definite duration

o In that the conditions that will cause the estate to end are knowno But when these conditions will arise are unknowno Fee simple, Life Estates, Fee Tail

Transferring Freehold Estates: Feoffment by livery of seisin (acquisition of land by freehold)

o Feoffor - person transferring something (vendor, seller)o Feoffee – purchaser

Trustee holds legal interest transferred in public Beneficiary holds equitable interest transferred in private

Leasehold Estates For a "fixed duration" (e.g., 99 years) May be open ended lease (e.g., continuing as a tenant), but a notice will bring the lease to an end

Copyhold Estates Estates that were held by the poorest segment of English society

Transfers after death: Courts relax the strict common law rule that governs inter vivos transfers So long as the Will provided adequate provision of the intent to transfer the fee simple interest, court will allow it

15

a) Fee Simplea. Potentially forever, but if no heirs it will escheat to the Crown b. "fee" = estate inheritablec. "simple" = unconstrainedd. "to A and his/her heirs" (wording of grant is crucial) you had to say this; if not transferring "life estate"

i. This was a rule of law - intent didn't matter at common law ii. Words of purchase = "to A"

iii. Words of Limitation = "and his/her heirs" - describes the quantity, what they are receiving

P. Property Law Act s.19 Q. Land Title Act s.186 R. Wills Act s.24

i) D’Arundel case 1225 Father held the interest in land; Roger transfers estate to William; Son of Roger disputes this transfer: admits deed but

didn't have the capacity to transfer to William; Randalf (the son) only has the hope to inherit the land Effectively say: "to A and his/her heirs" confers nothing to the son - father holds the land in fee simple

ii) Thomas v. Murphy 1990 (Transfers After Death)Facts: M provides opinion to T that T acquired fee simple interest; T has to pay extra to fix title & make it fee simple b/c unclear; no language re “and her heirs”Issues: what type of interest was it? Fee simple, Less? – Yes, intention = to transfer fee simple interest to residual beneficiariesRatios: In Wills, intention matters, and there is a relaxed requirement on construction of Wills

iii) Shelley’s CaseRatios: (NB: applies to content of gift only (not purchase). “To A for life, remainder to A’s Heirs” Confers fee simple interest to A (court interpretation) Even though “remainder” appears to confer some interest to heirs, these were interpreted to be part of the “to A for life”

granting words (i.e., Words of Limitation) "no matter what the intention of the transferor”

b) Fee Tail"to A and the heirs of his/her body"o "Fee" means that the estate is inheritable o "tail" for specific descendent only (can be more specific - e.g. only of a particular spouse)

General - all heirs (biological) can claim Special - limits this - can be only children from the spouse (in multiple marriages) only females, males

o Conditional [A if A has heirs]When the estate ends - it escheats to the Crown: Imposes significant restraint on alienation

o If you have a fee-simple interest you have subsequent life estates within the family All you could transfer at the end of your life was your interest to another family member

Strict Settlement: If you want to preserve a family estate you need two things1. That the property is never divided - default is that it's held by the eldest son2. Each successive heir had to be limited w/ the land as to what they wanted (sell/ transfer mortgage/ property)

Rule against perpetuities' 1. Allow restrictions on the use of land, but only for a limited time (couldn’t let generations to come encumber land)2. This is where the strict settlement intervened

Fee Tail + life estate holders can together agree to re settle + bar tail fee simple By agreeing grandson will hold life estate + great grandson will hold remainder in tail - make agreement next generation Founder has a child, but not yet a grandchild; Child (tenant for life); Grandchild (tenant in tail) - Resettlement "to my child for life, remainder to my eldest grandchild and the heirs of his (or her) body"

o So, when the son or daughter dies, the grandchild holds the estate in fee-tailo As a tenant in tail now the grandchild's interest has 3 important qualities:

1. As soon as the grandchild acquires the fee-tail - the grandchild can bar/cut off the tail (that is, enlarge the rights to a fee-simple)

2. Before the grandchild acquired the fee-tail, he/she was unable to cut off the end-tail by him/herself3. But with a consent of the tenant for life (child) the grandchild might cut off tail and stand to inherit fee-simple

S. Property Law Act s.10

c) Life EstatesLeast of the freehold estates – lasts for only the life of the holder

16

Words of limitation not proper: life estate transferred; now, presumption: largest estate possible is transferredNot inheritable except…

"to A for life" Life estate pur sa vie : measuring life is the same as the life that owns the interest

"to A, for the life of B" Life estate pur autre vie : The measuring life - cestui que vie - is other than the life of the person who holds the estate

What happens if A dies before B?Common law: If A died before B, land becomes vacant, & life estate would be lodged w/ 1st occupier (usually family member)BC statute: T. Wills Act s.2 What's left of the life estate can be directed by A to be distributed by Will

Revisions: “From O to A for life” interest reverts to O when A diesRemainders: “From O to A for life, then to B in fee simple” interest passes to someone other than transferor when A dies

Rights of a life tenant: Waste (4 KINDS):i. Permissive waste: Changes brought by neglect - passive conduct that permits decay

Unless the instrument instructing the life estate is liable for permissive waste - a life tenant is NOT responsible for diminished value in property from lack of action (Hold that if the testator says so)

ii. Voluntary waste: Changes to the land that are brought by the life tenant 1. Timber - cuts from the property 2. Mines and minerals - excavation4. Demolishing or altering buildings 4. Changing use - e.g., agricultural changed to residential LIFE TENANT MAY BE ACCOUNTABLE FOR SUCH CHANGES IF TRANSFER INSTRUMENT DOES NOT ALLOW IT

If this language is not there, the life tenant may still likely be found liableiii) Ameliorating waste

Variation of voluntary waste - actions by the life tenant that ENHANCE the value of land Life tenant not responsible for ameliorating waste (even if diminishes value on next tenant: obj determined)

iv. Equitable waste: wanton/severe destruction: Liable for this waste even if transfer instrument says not impeachable

i) Re Walker 1925 (Creating Life Estate: Repugnancy)Facts: "I give and devise unto my said wife all my real and personal property saving and exception [description of various items] and also should any portion of my estate still remain in the hands of my said wife and the time of her decease undisposed of by her such remainder shall be divided as follows.."Issue: Hold fee simple of life estate? – Life Estate, cannot give everything then dictate where it goes afterRatios: what's crucial is the intention of the testator (in this case, intention clear, but can’t give full effect)Court surveys 3 possibilities1. Fist gift = fee simple – court chooses this2. Life estate only, remainder goes onto other parties 3. 1st name takes life estate w/ power to encroach on capital: i.e., right to use income from prop NB: can't diminish capital Court decides of the first two options - fee-simple prevails Crucial word from 374 - DIDN'T PUT ANY RESTRICTION ON WHAT THE WIFE COULD DO WITH THE PROPERTY CANNOT CONTINUE TO GIVE AFTER YOU HAVE GIVEN EVERYTHING

ii) Re Taylor 1982 (Repugnancy)Facts: "I give, Devise, and Bequeath all my real and personal estate of which I may die possessed to my wife Kathleen Augusta Edith Taylor, to have and use during her lifetime… Any Estate, of which she may be possessed at the time of her death is to be divided equally between my daughters"Wife’s will conflicts: Gives to charity and divides amongst the othersIssues: What remains from the husband’s estate is determined dependent on whether

a. If wife got a fee-simply interest (can do what she wants)b. If wife got life-estate (ends when her life ends)

In this case, the property goes to husbands estate and distributed to the daughtersRatios: Fee simple or Life Estate?: Intention of the testator from the will, taken as a whole, is your anchor "to have and to use during her lifetime" = intent to transfer a life estate

Power to encroach: power to diminish the value of the capital (sell off portions of the capital; belongs to the person who holds the remainder in fee simple) Does leave the possibility that the property can be encroached entirely (NB: the power to encroach can be limited) Limited to : purposes of maintenance; cannot be given away

Distinguishing features from Walker: Walker didn't have any WORDS OF LIMITATION (e.g., in her lifetime); In Walker, there is a contradiction - fee simple with remainder = impossible

iii) Christensen v. Martini Estate 1999 (Repugnancy)Facts: "I give to my wife Sharie Raby of Calgary 2203 31 Ave SW Calgary for her use. When she is no longer needs 2203 31 AVE SW Calgary that she give said property to Sandra and Sonya Christensen of the city of Calgary"Issues: is this a fee simple or life estate? - Martini had a life estate WITHOUT power to encroach

17

Ratios: 5 possibilities of what kind of transfer this is:1. Absolute gift (fee simple) 2. Determinable Fee + gift over3. Conditional Fee + gift over 4. Power to Encroach If confusion of conflicting opinions> look at entire will> if nothing> look to surrounding circumstances (relationship, loans, etc.)

NB: have to determine if one sentence is full and on its own: if there is a repugnant intention Usually give weight to the first clause, unless it's vague or repugnant A CLEAR FIRST INTENTION = WHAT THE TRANSFER IS

U. Law and Equity Act, s.11

10) Equitable Interestsa) Origins of Equity

King's Court: A body of advisors/courtiers who advised the kind and supervised the holdings of the realmo Eventually these courts construct the common law of England

Exchequeri. The body of official administrators rules that defines the relationship between kings and tenantsii. Sets the boundaries around the kings financial interests

iii. Concerned with who holds interest in tenure - who is ceased of the land Common pleas

i. Court that handled the bulk of the litigation - busiest ii. Handled disputes between citizens that didn't involve the king (i.e., civil suits that didn't involve the king)iii. This is where most of the writs are developed (the documents you needed to approach the court)

King's Benchi. Last of the common law courtsii. Assume the broad discretion for the matters of state (this discretion is gradually curtailed by a set of procedures)

iii. Kings bench = court of appeal to court of common pleas iv. Criminal jurisdiction and "matters of exceptional concern to the king" (e.g., treason)

Chanceryo Mortgages and loan appeals - when it was unfair o Would usually give the person a window at which to pay the debt

At one point, the lender can say it's long enough -Right of foreclosure can be invoked We divide courts between substance and process - this aspect would be peculiar - process dominated the common law o This is because as far as courts were concerned rights were only significant and remedies only available to people who

could be helped procedurally

b) MortgagesHolder of a property interest mortgages their house - transfer title to a lender and in return the lender owes moneyo This transfer of title operates as security for the loan

One direction being transferred to a lender (usually becomes fee simple holder), money goes from borrowero If the borrower failed to repay the loan - he/she would forfeit the property and would still be liable for the repayment

of the debt (if you paid a day late – forfeit the property and must repay the loan!)o Courts would intervene from the rule when the borrower forfeits the property and repay the loan - unfair - did

not overturn the rule, but operated as the "conscience of the common law"o A common law rule that violated good conscience could go to the chancery

So, if one could not get a remedy b/c a writ didn't exist, you go to the courts of equity A law that is bright lined and clear and applicable in every circumstance may in some instances produce an unjust result

o Main distinction between common law courts and courts of equity Responsiveness (equity) VS Certainty (common law)

Equity regards as done what ought to be done, Equity regards substance rather than form; One who seeks equity must do equity; One must come to the court with clean hands

18

c) TrustsLegal title remains w/ trustee; can make interests in equity (parallel w/ legal interest); leg int & equitable int can be transferred1. Express trust: Trusts that are intentional - set up and constructed – capacity to split interest in land2. Resulting trust Arise in 3 different contexts

a) Beneficial entitlement not fully disposed of - all equitable interests not disposed of, gets transferredb) Gratuitous transfer : when A gives property to B (not contract), B will hold legal title but it’s subj to resulting trust for A

This is because equity presumes bargains (equity will not aid the volunteer) Equity assumes the recipient will hold the land in trust for the donor

Presumption can be rebutted by showing that gift was intended (onus on recipient gift was intended) c) There is a common intention (not an explicit intention) to create trust

Property held in the name of spouses as joint tenants is proof, in the absence of evidence to the contrary, that spouses are entitled to own the property as joint tenants (includes money on deposit in both names)

Parties have to show an implicit common intention that the beneficiary is to be entitledPresumption of advancement – with gift: presumption that both the legal and equitable interest was transferred transfers represent gifts and that full beneficial and legal title passes to the transferee. That is, the Will is not followed3. Constructed trusts

a. Institutional - person who holds the property in trust uses it fraudulently (e.g., borrowers lawyer) b. Remedial - constructed trust used as a remedy for unjust enrichment

Property Law Act BC (19)(3) A voluntary transfer need not be expressed to be for the use or benefit of the transferee to prevent a resulting trust.So, unless otherwise stated, a gift passes legal and equitable title, abolishing the presumption of the resulting trust.

i) Picore v. Picore 2007Facts: Joint tenants – daughter and father; right of survivorship is an aspect of this joint tenancy - when owner dies co-owner immediately assume ownership of the property; never goes to the estate of the Co-owner if one survives; Father informs the bank that although he held the banks jointly with his daughter - he remains 100% owner of the asset; he will not gift the funds to the daughter; On his death, left the residue of his estate (that which was not given expressly to an individual) to the daughter and son-in-law; Son-in-law claims ownership to the residual estate because of the willIssue: Whether the father had transferred BOTH the legal and beneficial interest (in which case it would not go back into the estate)? Or whether she held it in trust? – Presumption of resulting trust where a transfer is made without consideration Ratios: presumption is of a resulting trust= starting point where a transfer is made without consideration o BUT the presumption of an advancement has been commonly applied in two situations

1. Father to children - presumption of advancement (but not mother) 2. Between husband and wife (but not the other way around)

Court considered the following to rebut presumption: statements made by the testator to his lawyer and family prior to his death; his failure to include the accounts in his will; and banking documents granting the right of survivorship to his daughter. Burden on the one stating presumption of advancement

Beneficial interest is "that right which a person has in a contract made with another" Legal Interest The amount of interest that is allowed or required to be charged by law

ii) Madison Estate v. SaylorFacts: Father put funds in joint account with daughter; siblings argue daughter had a legal interests resulting in a trust, thus the beneficial interest remains in the estate to be distributed under the terms of the willIssue: was the transfer conferred both legal and beneficial interests? No, parent and adult - inadequate evidence to rebut the presumption of a resulting trust (onus on daughter to establish it was not)Ratios: Except for the fact that the siblings supported the daughter in Picore to keep the land is the distinguishing featureTwo cases work together to provide a definitive statement of the law as concerns the presumption of advancement, which is now applicable only to transfers from a parent to a minor childCourts will be given a lot of discretion regarding what is and isn’t applicable evidence to rebut presumption Common intention : intention of parties to share ownership Arises where one person has title, but there is common intention held by parties, both contributing to purchase price

Triggered by agreement (implicit): BOTH CONTRIBUTED TO PRESERVATION OF PROPERTY AFTER ACQUISITION

iii) Murdoch v. Murdoch 1973 (Constructed Trusts)NB: after Murdoch, default by legislation is that property within a marriage is divided 50/50 - for common law spouses, they still must turn to the realm of trustsFacts: Farming property - farm hands, pooled income; Murdoch and father buy farm - held husbands name; Ms. Murdoch worked on farm, alone for some periods (5-6 month stretches)Husband and wife - marriage breaks down Ratios: LASKIN unjust enrichment of husband should result in constructed trust

19

iv) Rathwell v. Rathwell 1978 (NB: Ratio from minority decision)Facts: Similar fact pattern as aboveRatios: Held that ms rathwell was entitled to a constructive trust in the property Invoked doctrine of unjust enrichment - constructed trust = appropriate remedyUnjust enrichment when:1. One party was enriched2. When there was a corresponding deprivation of another party3. There was no legal obligation on the part of the party deprived to provide the services rendered

v) Petkus v. Becker 1980 (Constructed trusts engaged)Ratios: Majority in this case adopts the minority position in Rathwell - unjust enrichment from which a constructed trust should be remedy awards Becker proprietary interest in proportion to her contribution

vi) Sorochan v. Sorochan 1986 (Common Law Constructed Trusts)Facts: Common law spouses - no family law division; 40 years; Ms. S was primary caregiver for 6 children, helped on farm; Mr. S held title and brought ALL title into the relationship; Ms. S had NOT contributed anything to the initial propertyRatios: Proprietary interest, Reasonable expectation - that she would be entitled to some share, Length of the relationship

vii) Peter v. Beblow 1993Facts: Common law husband moved in with Beblow and her full children; Peter's property to begin with; Common law relationship for 12 years; Husband worked part time in summer months ; wife worked full time and took care of childrenIssue: whether mother is entitled to compensation even though her acts were not involved with the property itself? – Yes, unjust enrichment based on the fact that Beblow had made substantial contributions to the property w/out compensation – form of childcare and household worksRatios: establishing a property interest does not have to be related to works directly related to the house

viii) Kerr v. BarnalowFacts: Breakdown of the relationship of common law spouses - clear you're in the realm of constructed trusts; Instead of trying to determine a share that is held by the spouse that is not a legal title, don't do an accounting exercise, rather, one's seeing the couple in a joint venture of the rise or fall of the value of the property; Purpose of the resulting trust is that the claimant is asking for his/her property back based on the proportional interest that the other has acquiredIssues: is the P entitled to their property back? Ratios: The parties have never put their mind to the fact that property was shared - may be no way to make common intentionTO ESTABLISH UNJUST ENRICHMENT: 1. Enrichment2. Corresponding deprivation 3. Absence of juristic reason - is there a legal obligation on the part of the party to provide services to the one on legal title

that they should not be thought of as a legal beneficiary REMEDY:Co-venture, not totting up because

1. Fails to reflect realities of co-habiting couples2. Inconsistent with the inherent flexibility of unjust enrichment3. Ignores the historical basis of quantum meruit claims (not intended to apply to family law context)4. Not required by precedent

Factors to consider:1. Mutual effort2. Economic integration 3. Actual intent4. Priority of the family

SO, CONSTRUCTED TRUST IS REMEDY FOR UNJUST ENRICHMENT FOR CO-HABITING SPOUSES IN MARRIAGE BREAKDOWNPARTNERS/CO-VENTURER WHO SHARES THE ASSETS, DETERMINED BY FACTS OF THE CASE

ix) Soulos v. KorkontzilasFacts: real estate agent bought property he was negotiating to buy for a client; Client sued, but had no lossesIssues: is a constructive trust created over property created w/o enrichment/deprivation?Ratios: 4 PART TEST (Becker v Pettkus)o Def must have an equitable obligation in relation to the activities that give him the assetso Assets must have been required in an activities w/ a duty owed to the plaintiffo Pl must show a legit reason for seeking a proprietary remedy o There must be no factors that would render giving a constructive trust inequitable

A constructive trust doesn’t req enrichment/deprivation. Can be created to right a wrong if accordance w/ equitable principles.

20

11)Conditional GiftsVested Interest:• An interest is vested when no conditions or limitations stand in the way of enjoyment• Natural termination of a prior life estate is not treated as such condition• In “to A for life, then to B in fee simple”, both interest are vested. A is said to be vested in possession and B is said to be vested in interest. Being vested in interest means havingright to future enjoyment.• An interest vested in possession can be divested if it is determinable or defeasible.• All vested interests are fully alienable and can be sold or transferred in any way.

Contingent Interest: • A contingent interest is one where vesting is delayed pending the occurrence of a condition precedent, thehappening of which is not inevitable.• A right of re-entry is contingent, because it is subject to a condition precedent.• Courts dislike contingent interest and favour vesting whenever such interpretation is available.• Determinable Limitation: terminates a determinable interest and is a part of words of limitation. If it is void, then the

entire transfer is void.• Condition Subsequent: terminates defeasible interest. It’s not a part of words of limitation. If it is found void, then the

gift is a fee simple.• Condition Precedent: vests a contingent interest (the conditions precedent and subsequent can be the same event)

Future InterestsGuaranteed future interest are of two types. They are both considered interests in land, vested in interest and arefully alienable.Reversion:• “From G to A for life”• Property reverts to G on the expiration of A’s lifeRemainder:• “From G to A for life, and the to B in fee simple”• Property goes to B on the expiration of A’s lifeThere are also two types of future interest that are not guaranteed per se:

a) Possibility of Reverter:• “From G to A until X, then to G”• The future interest created by a determinable title• G has a possibility of reverter - it may never happen (as opposed to a full reverter after a life estate, since a lifeestate will always end at some point), but once it happens, G automatically receives the title, with no formaldemand necessary• Possibility of reverter is an interest in land, vested in interest and is fully alienable

b) Right of Re-Entry:• “From G to A on condition that if X, then to G”• The future interest created by a defeasible title• G has a right of re-entry, which is different from possibility of reverter, as the title is not received automatically anda formal demand is needed - essentially condition X gives G a cause of action to recover the title• A right of re-entry is not an interest in land.• It must be exercised within six years of the condition (per Limitations Act)

Present InterestsThere are three types of present interests. All present interest are vested, but only indefeasible is vestedunconditionallya) Indefeasible title:

• “From G to A”• A is unconditionally vested in possession and cannot be divested.• This is the most concrete form of interestb) Defeasible title: condition subsequent

• “From G to A on condition that if X, then to G”• A has a defeasible title, and is said to be vested with a possibility of divestment subject to condition subsequent X,upon which A is divested and the title goes to G. • Created using words “on condition that”, “but if ”, “provided that”, “if it happens that”, “but when”c) Determinable title: Determining event

• “From G to A until X, then to G”• A has determinable title, which is vested, but upon the determinable limitation X, A is divested and the title willautomatically revert to G. • Created using words “while”, “during”, “so long as” and “until” (NB: 6 year limit applies)

21

INTEREST OF G RIGHT OF RE-ENTRYContingent Vested

Condition PrecedentCondition Subsequent

INTEREST OF A DEFEASIBLEVested but may be

divested

POSSIBILITY OFINTEREST OF G REVERTER

Vested inVested in possession

common law Determinable LimitationDeterminable Limitation

INTEREST OF A DETERMINABLEVested but may be

divested

Rules of Construction• Courts favour vesting or ‘early vesting’ and are loath to imply contingencies, where a vesting can happen instead. • A rebuttable presumption in favour of early vesting arises , which can be overcome by language showing contingent interest . • Browne v. Moody [1936] establishes that a gift is vested if the postponement is only to allow for a prior life estate • Re Francis establishes that unless, the reason for the postponement of the gift is one personal to the recipient, then prima

facie the gift is contingent • Phpps v. Ackers [1842] establishes a rule that “To A if or when her attains an age of X” is a condition subsequent, not

precedent. So, A gets immediate defeasible interest, subject to divestment if he dies before reaching age X • So, where the facts allow it, the court will prefer a determinable limitation or a condition subsequent over a

condition precedent. • There is also a presumption against intestacy

i) Starburn (Municipality) v. Kiansky 2001Facts: D is an official in the city, under the condition that all officials are owners of land. D sold his property, but has a remainder interested to a life estate of his grandmotherIssue: Does the remainder interest qualify as being a current owner of land?Analysis: freehold estate can be interpreted to mean freehold right, title or interest in land • Remainder interest is a vested interest, though it is an interest vested in interest, not in possession thus it allows D to be

classified as a present owner of a freehold estateRatios: remainder interest is vested, and thus a valid freehold estate.

• Life estate operates concurrently with life estate – it is a present interest, BUT NOT a possessory interests so long as the life estate remains, but it is present right to future enjoyment

ii) McKeen Estate v. McKeen Estate 1993Facts: Testator dies and leaves estate in trust for his wife for her life, and on her death divided in fee simple “equally between his two sisters, if they are both alive at the time of death of said wife”. Both sisters die before the wife.Issues: Was the intent to make sisters’ interest contingent them surviving the wife, or vested in interest?Ratios: presumption against intestacy and inclination to vesting• The first thing to look at is the intention of the testator • If unclear, the court will decide what a reasonable person might have intended

• Where construction of the will is doubtful, court assumes testator did not intend to die wholly or partially intestate • If there is a clear intention that the testator intended to fully dispose of the property, but it is ambiguous as to how,

the court prefers a reading that will effect a complete disposition of the whole. • There is a inclination in favour of vesting. See rules in Browne v. Moody and Phipps v. Ackers on previous page • A will that makes no reference to the time of vesting should always be held to take effect at the testator’s death, and

lead to vesting in interest .

22

iii) Caroline (Village) v. Roper 1987Facts: D transfers a piece of his property to be used as a community hall, retaining title to the land. After his death, community hall reps asked for a transfer of the title, to help them build some extra amenities on site. A conditional deed was signed, with a clause “shall revert back to D if used for other than a community hall”. Some years later, it burns down, and the city wants to use the land for commercial development.Issues: Is grant a determinable fee simple subject to a right of reverter, or a fee simple subject to condition subsequent?Ratios: If the termination event is external to the limitation, then the interest is defeasible• If the termination event is external to the limitation, it is a divided clause from the grant and interest is upon condition • The words of the deed “this acre... shall revert... if ” are in future tense and depend on something that may or may

not occur. Thus, the fee simple is defeasible if a future event occurs.• This is an offence against the rule against perpetuities • But the intention of the parties was that the land reverts after it ceases to be used as a community centre • So the deed is rectified, and D gets the property back. – overriding importance of intention

iv) St. Mary’s Indian Band v. City of CranbrookRatios: must look at respective intentions & not be bound by formalities – use of the word “should” is a condition precedent

State limitations on Private PowerThe following applies to real property:

a) An invalid condition subsequent is severed from the grant , destroying grantor’s right of re-entry , and turning the transfer into an absolute fee simple

b) An invalid determinable limitation destroys the entire grant: both the determinable interest and the right of reverter are destroyed, putting the interest back to the grantor.

c) An invalid condition precedent is destroyed, possibly taking the whole grant with it d) Conditions subsequent are held to a higher standard of certainty than conditions precedent. As the recipient must be able

to see clearly which actions will lead to the loss of the interest. Compare the two:

d) “To A in fee simple provided that she does not sell to an Irishman” This is a defeasible interest with a condition subsequent. The condition subsequent is restricting the nature of the

fee simple. As it is external to the words of limitation, it contradicts interest and is found invalid and struck down. c) “To A in fee simple as long as she does not sell to an Irishman”

This is a determinable interest with a determinable limitation that describes the limit of the interest. It is intrinsic to the interest and is perfectly valid.

Grounds for violation:Efficiency Policy:• The condition is too vague or too imprecise may be void. Requires practical level of clarity, not precision. • Restrictions on alienations, as it limits the free flow of property and prevents efficiency. • Examples of restrictions on:

• The mode of alienation (cannot be leased etc) • The class of recipients (cannot be sold to X) • The time of alienation (cannot be sold for X) • The law allows some restraints but not blanket prohibitions • Transferor can restrict time and mode of alienation, and the class of recipients, but too severe of a condition can take

away the power of alienation substantially enough to render the condition invalid. • When the whole power of alienation is taken away substantially, it is sufficient for the courts to intervene

Social Policy: • Conditions that are against the accepted social beliefs of a just and democratic society

• Prohibits marriage or requires the commission of a crime

i) Unger v. Gossen 1996 (UNCERTAINTY)Facts: Testator bequeaths the estate to her three nephews, who at the time of the will (1980) lived in USSR. The condition of granting is that they immigrate to Canada, or their children do so. Only the ones in Canada have a right to the estate. Testator dies in 1994, when all the nephews live in Germany, except for one of their daughters (D), who is in Canada. Under the new immigration rules, none of the nephews can immigrate to Canada. Issues: Does the residency clause apply, even though it is impossible?Discussion: Only D is qualified as a resident, but as long as nephews are alive, she can’t claim estate until 15 years after death• This is based on possibility that the nephews can gain the estate if they immigrate to Canada (condition precedent) • But the condition precedent is impossible, due to new immigration rules • Unless it can be shown that the dominant intent was the condition, not the gift, then the condition alone must fail • Here, the condition is secondary to the bequeathing, and must be struck down Ratio: Unless it can be shown that the dominant intent was condition and not the gift, then condition alone must fail

• The intent of the will was that the money not be confiscated by the USSR

23

• Where a gift is subject to impossible condition, the dominant intent must be the gift

ii) Hayes Co. v. Meade 1987 (UNCERTAINTY)Facts: A will bequeaths property to an elder son, under the condition that he “reside on the land and cultivate it.” In the opposite case, the property is given to the younger son, but only after he pays his older brother $1000. The older son left to work in US, and returned 40 years later, to build a house & live there. During his absence, younger son was living on land.Issues: Is the clause a condition precedent or a condition subsequent?Ratios: In the cases of ambiguity, courts read a condition as subsequent, as it allows for immediate vesting• The condition must be such that the courts can see from the beginning, precisely and distinctly, upon the happening of

what event it was that the preceding vested estate is divested (not case here)• If a condition subsequent is uncertain, it is voided for uncertainty and transfer is considered absolute fee simple • If condition is precedent, then older son is not vested at time of father’s death and this reading fails whole transfer • Courts prefer to see a condition as subsequent • Clause uncertain b/c does not specify the time period that the son should “reside on the land and cultivate it”

iii) Re Leonard Foundation Trust (PUBLIC POLICY)Facts: Leonard, white supremacist billionaire who used his fortune to establish a Foundation that gave bursaries to WASPs of British descent. He regarded his money as a public trust, and wanted to perpetuate the glory of the British race by educating the youth (75% male 25% female bursary allocation). The fund operated under these terms for over 60 years, but Ontario Human Rights Commission sought to alter terms of trust, claiming that it was in violation of Province’s Human Rights code.Issues: Since trust is private, does public policy of non-discrimination apply? Provisions severed, does whole trust collapse?

• Family trusts are excluded from this ruling • Some subsequent scholarships with severe limitations (Protestants only) are upheld, since Leonard is different, as it is

distinguished on the grounds that it “was based on blatant religious supremacy and racism” Ratios: state policy applies to any trust with SIGNIFICANT PUBLIC ELEMENT• Look at why the trust exists (e.g., to provide public funding) – puts it into the public sphere• NB: Family Trusts are excluded from this ruling

iv) Trinity College v. Lyons 1995 (RESTRAINTS ON ALIENATION)Facts: P brought an application to court to enforce an option to purchase adjoining land. The land belonged to Bennets. In 1963 they sold some of the land to P and decided that if the rest of the land was to be sold, then the P would get the first dibs. P was also to pay all the taxes on all of the property, and if the land was sold to a third party, then the Bennets would compensate the school for the taxes. Later on, P acquired an option to purchase the rest of the land upon the death of Bennets for $9,000. In 1991, one of the Bennets dies, and P sought to exercise its option to purchase the land (now worth $125,000) for the set price. But it turns out that at some point before, the Bennets gifted the property to their daughters D.Issues: Is the option to purchase at the fixed price at death of the survivor unenforceable or void as a restraint on alienation?Ratio: option for when/if someone decides to sell more likely to be upheld upon death• The right of first refusal given by the Bennetts to the school was not void, but the right of option that was triggered by

their death was void as an unlawful restraint on alienation• “should they decide to sell, P would have first dibs” is fine, since it gives freedom of choice• Agreement giving fixed price option purchase is invalid, as it restricts right to alienate land (deprived of setting price)

o It essentially creates a life estate from a fee simple • A term will only be implied when there is an evidentiary foundation for finding that both parties would have agreed to it

and it is necessary for the business efficacy of the contract

24

12)Leases, Licences, and Bailmentsa) Nature of a lease

Lease : a demise of land under which exclusive occupation is conferred by a landlord tenant. While the lease is in force, the landlord has a reversionary interest, but the right to actual possession is suspended during the term of the tenancy (5 kinds)

1) Fixed Term:• The term is certain to both its date of commencement and termination • A lease with a fixed termination date, but which can be ended prematurely is valid. • The maximum length must be certain. 2) Periodic Tenancy: • In the normal course, continues until terminated by notice • Unless otherwise agreed to or specified by statute, the notice is the length of the tenancy period. • In case of early period, a six months notice is common law. • May arise from inference 3) Tenancy at Will:• Has no set period or term and continues only so long as both landlord and tenant wish • May be implied • Notice of withdrawal need not be express & conduct of either party may show tenancy being treated as over. 4) Tenancy at Sufferance:• Arises when tenant remains on premises w/out permission after termination of one of the other types of tenancies 5) Perpetual lease• With no fixed term or stated period, no right of termination on notice, this can last forever, and is technically not

tenable at common law. Elements of a Lease: a lease should contain -

a) Grant of exclusive possessionb) price, property, parties, term, and date of commencement

• The common law does not establish any formal requirements for creating a lease • According to Statute of Frauds, leases must be in writing • If a tenant enters into possession under a void lease and pays rent, the common law presumes a periodic tenancy • An oral agreement for a lease is treated as an equitable demise, if there are acts or part performances that can serve to

prove the existence of the agreement. • The lease runs with the land and can be sold and re-sold. Leases and Licences• A lease is a grant in exclusive possession - an interest in land (Factac)• A licence is merely a permission to do that which would otherwise amount to a trespass. (Factac)• A licencee doesn’t have standing to sue in trespass, and is deprived of a number of statutory provisions that apply to tenants • A lease is binding on the world (transferred with the land), a licence is not (agreement btw parties, non-transferrable) • A lessee can bring an action to recover his interest, a licencee cannot recover interest, only damages. • If exclusive possession is given, tenancy is presumed: this is the main approach of Commonwealth law • Not enough to simply label an arrangement as a licence or a lease - the question is not of form but of substance. • A licencee cannot sell his licence due to privity of contract.

i) Factac Ltd. v. Commissioner of Inland Revenue 2002 (LICENCE)Facts: In 1991 company granted Atlas the right to operate a quarry for 12 years with the right to renew for a term of 3 years; the company then sells the property to Mt. WellingtonIssues: Who is responsible for the GST payments? Is the agreement a licence or a lease? – this is a licenceRatios: Substance and not wording determinative of license or lease.• Intent and labeling are an important factor, but the content is most important. • The distinguishing feature of the lease is the right to exclusive occupation• A license only provides that the licensee can merely enter onto the land for a specified purpose; • Rent and calling the agreement a lease or licence is not required but can be evidence of a legally binding K • Limitations on use of property don’t disqualify land as a lease; i.e. exclusive possession not synonymous w/ unqualified use. • Even if exclusive possession = substance of K, an interest is not a tenancy if it can be terminated for reasons outside K; • If right to exclusive possession is to a small area (and a much larger area is used by occupier) may be a license

ii) Metro-Matic Service Ltd. v. Hulman 1973 (LEASE)Facts: Previous owners had lease agreement with PL to operate coin laundry in building; owners sold to new owners(D). D knew about the lease agreement and accepted rent checks from PL; but then they got another company to provide the laundry services and excluded PL from the premises (removed their machines).Issues: Did the agreement (called “lease agreement”) create an interest that runs with the property?Ratios: “Quiet enjoyment” implies exclusive possession.

• If something is a lease binds the next owner; if licence only binding between original parties• Presumption of lease if language says so not determinative, but shows intention of parties

o This presumption will stand unless rebutted by the terms of K

25

b) Obligations of Landlords and Tenants• The relationships between landlords and tenants are generally considered contractual and are governed by the lease

• But terms may be inserted by implication under common law, in equity, or by statute • Parties often agree to import the usual covenants: a standard set of terms

• These depend on current conventions and the nature of property leased • A covenant by the landlord to quiet enjoyment • A covenant by tenant to pay rent, keep and deliver premises in repair, pay some taxes (varied), and allow

landlord to enter premises to view state of repair • Parties may waive the application of terms implied under common law

Quiet enjoyment: • The right to quiet enjoyment is fundamental to a tenancy and is often explicitly included or implied

• It means peaceful occupation of premises and protection against substantial interference • Contravention: persistent conduct by landlord aimed to force the tenant out

• This is not directed against noise per se, but excessive noise can be a contravention• This does not protect against wrongful acts of other tenants

Derogation: partial revocation of a law• Non-derogation from the lease

• Lessor cannot use the property in a way that renders the premises substantially less fit for the purposes for which they were let. (Petra)

Repair • A central feature of most modern commercial and residential leases • Tenant must act in a tenant-like manner • Principles of waste apply

i) Southwalk LBC v. Tanner 2001 (QUIET ENJOYMENT)Facts: Tenants of the building complain that due to lack of soundproofing, they can hear everything that they neighbours do, including loud shagging and such. The neighbours are not excessively noisy, but the building is just too shitty.Issues: Are the landlords responsible for soundproofing as a part of “quiet enjoyment” covenant? NoRatios: “Quiet enjoyment” is only applicable to the actions of the landlord - not other tenants

• Nuisance can be used as a breach of quiet enjoymento Denning: nuisance constitutes violation of the covenant of quiet enjoyment

• Tenant must have substantial and direct/indirect interference w/ their enjoyment absent of notice/consento Reasonable to contemplate that other people would be heard

• Quiet enjoyment doesn’t literally mean quiet, but rather without interruption of enjoymentKurtis Investments: landlord can be liable, but only if there is active participation by landlord or consent to do so

• At some point, a lack of action on the part of the landlord constitutes consent

ii) Petra Investments Ltd. v. Jeffery Rogers plc 2000 (DEROGATION)Facts: D owns a small shopping centre in London. P entered into a 25 year lease in 1988. In 1996 D converted a part of the centre to a store for Virgin. During the period of construction, P’s business suffered. D offered a “service charge holiday” until the work was completed, as long as they do not sue him for disturbance of “quiet enjoyment”. When Virgin opened, P’s business did not improve: blamed it on the new store & closed down. D sued for unpaid rent. P claimed derogation of grant.Issues: Is the interference sufficient to be considered a derogation? Ratios: Using the retained land in a way that undermines the profitability of a tenant’s business is not derogation.

• TEST: whether the action complained of rendered premises “unfit or materially less fit to be used for the particular purpose for which the demise was made”o If business operation of one tenant in a mall significantly interferes w/ retail trade of another, it is derogationo But merely retaining land in a way that undermines the profitability of a tenant’s business is not derogation

• A landlord has a duty not to derogate the land promised to the tenanto Must be specific in what is promised when you enter a landlord/tenant agreement

• Cannot sue for something that wasn’t reasonably foreseeable

V. Residential Tenancy Act SBC 2002Standard Tenancy Agreement: Parties, Property, Date of Commencement, Length of the Term, Price,

• Implied quiet enjoyment – reasonable privacy, freedom from unreasonable disturbance, and exclusive use of the unit• Landlord must provide reason why a landlord is being booted

o Not fair if it’s one time (must be chronic)

26

13) Shared OwnershipAllows two or more people to have equal interest in the same land at the same time.Joint Tenancy:• Shared ownership that includes right of survivorship • Leaves the estate in one piece, and narrows interest to one owner • All tenants hold equal rights to the possession and use of the entire property Common Tenancy: • Shared ownership that allows the owner to sell their share of property, and to pass it on

by will • Divides the estate into pieces

Right of Survivorship:• On the death of a joint tenant, his or her share goes to the surviving co-owners • This does not apply if the tenancy is common

JOINT TENANCY COMMON TENANCY

• Wording “as joint tenants” • Wording “as tenants in common”

• If there is no direction, common law •the common law presumption of joint tenancy could be

presumes a joint tenancy.rebutted with words of severance in transfer instrument:

• In BC this is reversed by Property Law Act s. • “in equal shares”

11(2). So if there is no direction, there is a • “share and share alike”presumption for common tenancy. • “to be divided between”

• “to be distributed in joint and equal proportions”• “equally” “severally”• “jointly”• missing one of the four unities.

Four Unities of Joint Tenancy1. Unity of Possession : all entitled to concurrent possession of the whole land (applies to both joint and common) 2. Unity of Interest : each interest has to be of the same extent, nature (vested/contingent) and duration

• Common law presumption of joint tenancy could be rebutted with words of severance in the transfer instrument• NOT unity of interest: “to A for life and to B for 10 years as joint tenants” (can’t hold as JT’s)

“to A for life, remainder to B for life” ; “one third to A, two thirds to B as joint tenants” This is co-owners, but NOT joint tenants – need equal share

3. Unity of Time : all interests must be vested at same time. Subject to same vulnerabilities as the rule against perpetuities. 4. Unity of Title : title must be derived from the same document or occurrence (act or instrument)

Joint Tenancy ends if• If A and B are joint tenants, and A sells a portion of her estate to C, as A and C hold less than B • If A and B are joint tenants, and A sells all of the estate to C, as C came into possession at a later time

• This applies if A sells land to himself.

Three situations which equity does not follow common law presumption of joint tenancy:• Commercial Transactions • Two or more persons advance money to a mortgage. • Co-owners contributed unequally to the acquisition of the property

• one pitched more equity would hold they are owners in common – equity would create a trust stipulating that the beneficial interests were held in proportion to the contribution (Common law – equal shares)

Joint Tenancy or Tenancy – steps 1. Intention? What does the instrument indicate?2. If unclear, then what is the presumption?

Land Tenancy in common (following PLA s.11(2)) Personal Property Joint tenancy.3. If presumption of joint tenancy, does one of the equitable exceptions apply?4. If intention to create a joint tenancy, does it fail because lacking one of the 4 unities?5. If a joint tenancy, has one of the parties severed the joint tenancy?

27

W. Property Law Act BC s.11(2)

28

i) Re Bancroft Eastern Trust Co v. Calder 1936 (JOINT TENANCY)Facts: Samuel dies. Beneficiaries under his will are his wife, 2 sons, 1 daughter, and 2 grandchildren (Paul and Jean). Half share of Samuel’s estate to be invested during life of widow, the income to be divided into 4 equal shares (2 for sons, 1 for daughter, and 1 for grandkids together). Paul dies.Issues: Does the interest left in a will to Paul and Jean create a joint tenancy or a common tenancy?Ratios: If no express intention, then common law presumes a joint tenancy• If there is any indication of an intention to divide property it must be held to be a tenancy in common.

Common law presumption: when there is a transfer to a # of ppl w/out a # of accompanying words assumption = joint tenancy• Shares Per Stirpes: equal shares to a specified class

a) Severance of Joint TenanciesSeverance: The termination of an existing joint ownership relationship, turning it into common tenancy

i) Re Sorensen & Sorensen 1977 (SEVERANCE OF JOINT TENANCY)Facts: Marrian & Marshall divorce. Property they held as joint tenants includes home and adjoining lot. In settlement agreement spouses divided title to the lot. Marshall leases his share to his wife. She is diagnosed with cancer, and creates a trust deed, holding property in trust for her son, then a will, leaving interest to her son. She then files a notice of motion to partition lots (sever joint tenancy). On day of the hearing she dies. Marshall files caveat against lots right of survivorship.Issues: Has there been a severance of the joint tenancy prior to Marrian’s death? – No, judgement for sonRatios: Joint tenancy can be severed in three ways : Williams v. Hensman 1861

1) Act by one of joint tenants operating on his/her share; Act can be: • If one transfers their interest to another person or to themselves • Mortgaging of interest • Granting of a lesser estate (e.g. life estate) • Does not require consent of agreement of other parties: joint tenant can do whatever they please with their

interest, as if they were the sole owner 2) Mutual agreement among joint tenants to sever the interest 3) Any course of dealings which indicate that the interest of all were mutually treated as tenants in common

• No explicit agreement, but shown through conduct • Each had separate mutual intentional

• Lease agreement does not sever joint tenancy, at least not lease agreement between joint tenants.

• Mortgage does not affect right of survivorship. No severance because mortgage made between the 2 joint tenants, even though mortgage can usually sever joint tenancy in common law.

• Execution of a will is not allowed if not severed, so the will cannot be used to sever .

W Property Law Act s.18(1)

ii) Feinstein v. Ashford (INTERESTS AFTER DEATH)Facts: purchase of residential property in Pitt Meadows – separate; Husband goes to lawyer to sign application to sever – lawyer sits on it, doesn’t actually file it with the land title office; Ashford dies, lawyer files application to re-register 5 hours after he dies BUT you have to act on your interest before death – so Feinstein files action that they were joint tenantsIssue: was there severance?Ratios: you must act on your interest before death – but your intention can be made clear by your conduct

b) Resolving Concurrent Ownership Disputesi) Ontario Law Reform Commission, Report on Basic Principles of Land Law

General Rule: Co-owners have equal right to possession of the whole, and, as such, no general obligation to account for the actions of the co-owner, should you benefit from the rights of the property• Under Ontario Law reform Act most assets accumulated during marriage are treated as property to be divided equally

between spouses, regardless whether they were family or business assets. Exceptions: Ouster : A cause of action available to one who is refused access to their concurrent estate. Can be constructed based on actions of one owner.Occupation Rent : A matrimonial or joint tenant property compensatory claim based on an allegation that one spouse or joint tenant ought to be debited value of her /his exclusive occupation of the family or jointly-held home.- Parties can agree to compensate the other owner for their useAccounting against the co-owner benefits received from 3rd parties, but not profits taken from soil by their own doings

Waste (NB: we saw this in life estates and remainder in fee-simple; where it was useful is on things regarding “tragedy of the commons” – where one owner can take all the benefit where the cost is shared among others)

o Co-owner is able to do more than the owner of a life estate with wasteo Waste = anything that amounts to a deterioration in property or waste with malicious intent (equitable waste)

- Equitable accounting – equitable allowances between co-owners order payment of occupation rent may be limited to the situation where the party to be charged claims an allowance in respect of outgoings related to property

29

c) Family Property Law• Family law : only in a marriage break down (as of March 2013) BC’s new Family Law Act will be deemed to be co-owned and

divided 50-50 (Exceptions to property that’s brought in or given by parents)• Common law treats marriage as economic partnership • Rules governing property rights btw spouses are the same as applicable to all property owners, with some exceptions • The parties are entitled to walk away from the marriage with an equal share of the accumulated property, unless one of

them can establish than an equal division would be inequitable.

d) Condominium & CooperativeCo-Op: each resident owns a share in the property corporation, and the share gives them a title to the lease, which is an interest in land. The shareholder does not actually hold any property, but all the property is owned by the corporation, who is also responsible for the property taxes etc. This also includes a right to collective self-governance.

• Equity co-ops allow shares to be bought and sold on the market. • Social Housing Co-ops have shares that are not up for sale, or up for sale at a fixed price.

Condominium : allows for a fee simple ownership of land, while use of and access to common facilities in the piece such as hallways, heating system, elevators, & exterior areas is held as tenancy in common. Includes right to collective self-governance

30

14)Servitudes Over Propertya) Easements

Servitude (Incorporeal Hereditament) : a limited real right to the land of another, which confers on the owner of the dominant tenement, in principle, permanent and defined entitlements of use and enjoyment with regard to the servient tenement.Easement: a non-possessive interest to use someone else’s property for a stated purpose. It is similar to a license in the limited usufactory interest, but is much more challenging to terminate. Also, benefits of most easements flow to the adjacent parcel of land. An easement is considered as a property right in itself under common law, and is treated as a type of property.Dominant Tenement : the ownership of the easementServient Tenement : the ownership of the land subject to the easement

There are two broad categories of easements: • Positive easements allow dominant tenement holder easement to enter land subject to the easement for his benefit. • Negative easemen t does not give the right of entry, but merely restricts the use of the servient tenement.

i) Re Ellenborough Park (UK CA) 1956 (ELEMENTS OF AN EASEMENT)Facts: Full enjoyment at all times hereafter in common with other persons of the pleasure ground, but subject to the payment of fair and just proportion of the costs of keeping in good order and condition of the said pleasure ground. Used in WW2 and one of the owners was compensated by the war office. Owners of houses claimed they had an interest in the land and should be compensated. Claimed they had an easement and as such had an interest in the landDecision: Trial court agrees and says they should be compensatedRatios: ***There are four necessary elements

1. Easements have to be attached to an estate on both ends: the benefit from it should flow into an estate, and the detriment should be taken from an estate. i.e., there must be dominant and servient tenements

• Derived from economic efficiency doctrine: a detriment to one property is only justified by benefit to another. 2. Easement must accommodate the dominant tenement (must be reasonably necessary for better enjoyment of that

tenement) (except for statutory Right of Ways as per s LTA.218) 3. Both dominant and servient tenement cannot be owned by the same person (PLA s.18(7) is an exception)

• Common ownership and possession of the dominant and servient tenement does not extinguish an easement 4. The easement must be capable of forming the subject-matter of a grant, as it is originally given as one. B/c the

easements are incorporeal, transfer of possession is not poss, & a grant is required in order to pass ownership. • It may not be too vague, It may not amount to a mere right of recreation, It may not extinguish the possessory

interest of the servient tenement. On exam – set out the test, give the rule, and narrow in what the key issues areE.g., Too vague? Extinguish possessory interest? – right to build a swimming pool seems more invasive than a pipeline – is this, in effect, giving a possessory interest that extinguishes the right of the tenant, and conclude

ii) Shelf Holdings v. Husky Oil (Alta CA) 1989Issues: Can underlying pipeline count as an easement? – Yes – because of how he used his titleRatios: Court found that the P could use the land, free from interference – the two interests could co-exist (Easement in gross: an easement that attaches a particular right to an individual rather than to the property itself – doesn’t run w/ land.

Profit A Prendre: servitude to take the profits of the soil from someone’s land (extract minerals or other natural products- Profits a prendre are transferable interests in land that run with the land and encumber the land (as opposed to

licences; which are purely contractual and are not transferrable); owner of land can’t unilaterally revoke the profit prendre as they can with licence

- Don’t have title to the resources until have actually taken possession of it; - Don’t need a dominant tenant; can hold a profit a prendre without owning any land (in gross) - Can restrict quantity and type of resources that can be extracted;

i) BC v. Tener SCC 1985Facts: the Crown grant stipulated that “all minerals… under that Parcel or Lot of Land situate in [description]… and the right to use and possession of the surface of such mineral claim… for the purpose of winning and getting from and out of such claim the minerals contained therein”Decision: BC has a profit a prendre interest in the landReasoning: “this is a right of severance which results in the holder of the profit a prendre acquiring title to the thing severed. The holder of the profit does not own the minerals in situ. They form part of the fee. What he owns are mineral claims and the right to exploit them through the process of severance

31

b) Access to Public and Private Propertyi) Director of Public Prosecutions v. Jones 1999 (Charter and access to property)

Facts: Save Stonehenge movement – protesters wanted to “Free Stonehenge from all of the fences”; people should have access to it, protest against fenceIssue: should people have access to Stonehenge? – Yes – public authority: restriction of leaflets = restriction of 2(b) rightRatios: the charter applies to state action and can affect the state’s power of exclusion over its property (public property)

Question of what happens on private space – Harrison v. Carswell

ii) Sky City v. New Zealand Case (Monopolies and access to property)Facts: person banned from casino. Scenario where someone might have an easement to public-like property. In the context of a MONOPOLY (only casino in town) Ratios: where the owner of a property is the only deliverer of that service, then restriction by the owner is undue influence

c) CovenantCovenants (contractual promises) over land can be used to create rights enforceable by one landowner against the other, even in the absence both of privity of contract and estate between the parties. Covenants are similar in function to zoning regulations, but are grounds-up made and have legal consequences.• Covenants are essentially promises under seal (made in deed) . They are regarded as valid contractual undertaking

made by a covenantor (who assumes the burden of the promise) and the covenantee (who obtains the benefit). • The language of servient/dominant tenement applies to covenants too.

Positive covenant: req person holding land which is burdened by covenant to DO SOMETHING on land requiring expenditure- NB: these DO NOT run with the land at common law or equity

Restrictive covenant: requires the holder of an interest in land burdened by the covenant to NOT do something (i.e., restricts, the holder of the land)

- In equity, restrictive covenants CAN run with the land (Tulk and Moxhay)Conservation covenants: protect sensitive areas (e.g., eco reserves, heritage sites, etc.)

Uses of covenants:• Restricting the type of development available on land • Conservation and preservation of sites • Restricting the form of business available

i) Tulk v. Moxhay [UK] 1848 (Covenants: requirements)Facts: A covenant is entered into to maintain a parcel of land in central London as a public park. A purchaser of the property, aware of covenant, tries to escape his obligation by claiming he is not privy to the K & thus not bound by it.Issues: Does the obligation to covenant run with the land? – Yes, the covenant is binding.Ratios: Covenants run with the land and are binding on the new owners.• Prior to this case, for covenants to run, the original agreement had to be made by a landlord and tenant at the time that they

entered into the lease, that is, there had to be privity of estate, also called "horizontal privity." • If the agreement had been a contract instead of a covenant, it would have been enforceable • Court decided that the covenant was enforceable at equity, that is, when PL seeks an injunction as opposed to damages • The result does not turn on whether the covenant runs with the land. • Horizontal privity (privity of estate) is not required for the burden of a covenant to run at equity. • If equity is attached to the property by the owner, no one purchasing with awareness of the equity can ignore it.• 4 basic requirements for covenant to run with the land:

1) Negative in substance2) Intended that the burden is to run with the servient land3) For protection or benefit of dominant land( Must enhance dominant tenement; Must touch and concern land)

i) A covenant that is only a restriction on alienation will not run (e.g., Covenant that says property will not go to identifiable individuals)

ii) Restraints on trade will be subject to the rule of “strict construction” (apply text as is)4) General limitations on equitable principles apply (person acquiring interest be bona fide purchaser for value with

notice of that burden

Benefits in Equity and Law:1. Annexation

• The benefit is attached to the land - it must touch and concern the land • Intended that the benefit run with the land • Transferee must acquire entire interest of the original holder

32

2. Assignment :The benefit can be transferred from one parcel to the other 3. Building schemes See following case:

ii) Berry v. Indian Park Assn ONCA 1999 (RESTRICTIVE COVEN FOR DEVELOPMENT)Facts: D - a planned community Association - imposes a restrictive covenant on the use of lands that it controls. It later acquires a neighbouring development, upon which it imposes a similar covenant of by-laws, also charging the residents membership fees. They don’t like it much and tell the Association to bugger off. Association claims that they are a part of a building scheme.Issues: Does the obligation to covenant run with the land?Ratios: Restrictive covenants for purpose of development can be created through a building scheme.• There is no privity of contract, so the only way this will work is under the restrictive covenant a-la Tulk v. Moxhay • Such is not the case here • There is another exception: that of building schemes, which allow a restrictive covenant for the purpose of

development to be enforceable despite lack of privity. • The prerequisites for a building scheme come from common law and statute

Land Titles Act: 219(1)• The covenant on use is to be registered with the land • It may be modified or discharged by the order of court on proof that the modification is beneficial to the persons

interested • In this case, the Association fucked up on pretty much every count • So the new acquisition is not part of the building scheme, and the by-laws have no effect. Ruling: The Association can bugger off

iii) Re Drummon Wren OntHC 1945 (Public Policy)Facts: land being raffled off subject to this provision: “Land not be sold to Jews, or person of objectionable nationality”; Council for the case said this was void against public policy, invalid as a restraint on alienation (restraint that cut to the heart of the interest that was being transferred), void for uncertainty (who qualifies as a Jew), in violation of Human Rights Act Ont ; court tries to anchor this public policy in an emerging body of public law

Land Title Act s. 222(1): A covenant that, directly or indirectly, restricts the sale, ownership, occupation or use of land on the account of the sex, race, creed, color nationality, ancestry or place of origin of a person, however created, whether before or after the coming into force of this section, is void and of no effect

There are four main pillars to covenants:1. The covenant must be negative in substance: only restrictive covenants are enforced, where compliance is possible

by the owner doing nothing. 2. It must have been intended that the burden was to run with the servient land, and that land must be sufficiently

described in the covenant. 3. The covenant must be taken for the benefit of dominant lands, and that those lands must be sufficiently

identified in the document. 4. All general limitations imposed on the availability of equitable remedies apply.

LTA s.222 says that a covenant that restricts the alienation or use of the land based on sex, race, nationality etc. is void and has no effect.

Conservational Covenants : for the purposes of conservation, a covenant can be imposed upon land, where the dominant tenement is replaced with a government agency, ministry, trustee, charity etc. This allows the covenant to be held in benefit for the public.

33

15)Common Law PrioritiesThe deed was the primary device for transferring property in common law; it was the instrument that the transferor uses to give title to the transferee. Question is where does the law allocate the risk if there is a defective transfer (something goes wrong) and end up with competing claims to the same interest in land?Law has moved from protecting just the owner (common law principle of first in time is first in right) to protecting interest of purchaser and market transactions (through statute);

• This change occurred to encourage economic transactions (economic theory); • In order for market to work effectively there must be certainty/ security, which the registration system provides; • Land has changed from being seen sociologically as a special, fundamental possession of a person to being seen

economically as a transferable market commodity;

Nemo dat quod non habet: one cannot give that which they do not own - this was the original principle of common law. • Common law and equity priorities were changed by the registration system • Thus, title is relative. Registration determine the ordering of rights.

Transfer of property is a two step process: 1) the agreement to transfer gives rise to equitable interest for the purchaser, and 2) the finishing of the sale transfers the legal interest.

Mortgaging property transfers title (legal interest) to the mortgagee, while maintaining equitable interest (Equitable Right of Redemption) in the hands of the property owner. This remaining interest can be mortgaged out to another party in an “equitable mortgage”.

There are four scenarios of possible conflicts between common law and equity:1. Prior legal interest and subsequent legal interest• Prior legal interest takes priority.• For example, A transfers to B and then also to C. In this case B has better claim based on first in time is first in right and

nemo dat. Burden lies entirely with purchaser to verify that A has proper title to transfer.

2. Prior equitable interest and subsequent legal interest• This is the interesting case; subsequent legal interest takes priority so long as purchaser paid money and did not have

notice of prior equitable interest.• For example, A agrees to sell to B; A gets a better offer from C and goes through with transfer to C. In this case, B get

equitable interest based on a constructive trust; who gets title depends on whether C had notice of the prior transfer; if C was a bona fide purchaser for value without notice of the prior equitable interests, then law favours the good-faith purchaser; C gets everything and B gets nothing but B retains a cause of action against A;

• Another example, A agrees to sell to B, but A gives as gift (legal interest) to C. In this case B definitely wins because it was a gift and not a purchase for value;

• Another example, B is long-time tenant of owner A; A agrees to sell to B; C offers a better price which A accepts and A completes transfer to C. B has prior equitable interest and C has subsequent legal title. In this case, question is whether C had notice or should he have known (constructive notice). Fact that B is in possession implies C should investigate, at least in terms of understanding terms of existing lease agreement. Law makes a strong presumption of constructive notice where one party is in possession.

• Three categories of notice : a. actual notice b. imputed notice: notice through an agent (someone operating on your behalf) c. constructive notice: when purchaser ought to have made further inquiries/ would have known if made inquiries

• One more example based on a real case: elderly woman transfers title to boarder (B) and agree orally that he will hold in trust for woman; B sells to C without saying anything about the trust; C investigates property but assumes old woman is wife of B; who gets title?

• In this case woman has equitable fee simple (based on oral agreement) and C has subsequent legal title. Is C a purchaser without notice or does constructive notice apply? Court decides that C should have made more inquiries. Again illustrating strong presumption of constructive notice where one party is in possession.

34

4. Prior legal interest and subsequent equitable interest • Prior legal interest takes priority over subsequent equitable interest. • For example, A mortgages interest in land to B; A then mortgages remaining interest to C; in common law first mortgage is

legal mortgage and second mortgage is an equitable mortgage; if A defaults and value of land is not enough to repay both lenders then who has better interest in land?

• The prior legal interest has priority in this case and almost any case where there is prior legal interest. First loan paid off before second.

4. Prior equitable interest and subsequent equitable interest• Prior equitable interest takes priority. • A transfers equitable interest to B and then to C; first in time prevails regardless of notice;

i) Chippenwas of Sarina Band v. Canada AG [2000] ONCA (sui generis)Facts: A portion of reserve land was transferred from Chippewas to Cameron back in XIX cent. In 1853 Crown issued title grant (“letters patent’) to Cameron for that land. But it turns out later that Chippewas never formally surrendered their land to Crown as is required under rules of aboriginal title (Royal Proclamation 1763). Therefore PLs are arguing that the letters patent are void and they should have full title back;Issues: Did the Chippewas wait too long, or can they reclaim title to the land? No, P’s claim failsRatios: Aboriginal title is sui generis and does not equate to legal title, therefore the subsequent legal title takes priority• PLs claim that since the original transfer was flawed, then the title is still in the hands of the tribe. The Crown was not able to

legally transfer the title to anyone, because it was not theirs to begin with. • It is true that there was a fundamental flaw in the original transfer such that it was not legally effective; but based on

equitable doctrine of laches (unreasonable delay in making claim) P waived right to sue by waiting so long - over 150 years. • But, also based on the bona-fide purchaser without notice principle, the subsequent purchaser’s legal interest have

priority over the prior equitable interest of aboriginal title; but is aboriginal title equitable or legal? • Court: abl title not exactly a legal interest – it is sui generis in nature; it has elements of both legal and equitable interests; • Court concludes that because it has elements of an equitable interest, it is subject to the subsequent legal interests of the

bona fide purchasers for value without notice. • Aboriginal title is sui generis and does not equate to legal title, therefore the subsequent legal title takes priority.

Otherwise the prior title would have taken priority. .

35

16)Aboriginal Title and Land Rights on Indian Reserves• In 1846, the border of the 49th parallel is extended to the coast, cutting the existing Oregon Territory into two. • In 1849, the colony of Vancouver Island is established by HBC, as a proprietary undertaking under the British Crown • The formation of the Colony revolves around the process of treaty making • The first 14 treaties are known as the Douglas Treaties (1850-1875).

• these are based around Victoria, Saanich Peninsula, Nanaimo and Port Hardy. • these treaties are essential land deeds - delineating the property, transferring the rights to the colonists, and

naming the price paid. • the treaties are assembled in pieces - the conference with the tribes produces the signatures, which are later

attached to drafts of other NZ treaties that are sent to Douglas by the Crown. • what is the property interpretation of these treaties? • is treaty wholly contained in written text or does it include the oral agreements that preceded them.

• After 1927 House of Commons Committee, it was illegal to hire a lawyer to deal with Aboriginal and Treaty rights, without an approval of the Indian Council. This was meant to protect unscrupulous lawyers taking advantage of natives, but in fact resulted in the freezing of status quo for almost 50 years.

• The White Paper of 1969 proposed the abolition of the Indian Act of Canada, the rejection of land claims, and the assimilation of FN people into the Canadian population with the status of other ethnic minorities rather than a distinct group. This lost momentum by 1973, especially in the Calder v. AG BC [1973] SCC, which acknowledged that Aboriginal Title existed prior to colonization and was not extinguished.

• This led to the renewal to the negotiation and re-settlement of the treaties in 1970’s and 1980’s in other provinces. BC refused to participate.

1982: Constitutional entrenchment of Aboriginal and Treaty rights (s.35(2))Constitution Act: 35(1) The existing aboriginal & treat rights of aboriginal peoples of Canada are hereby recognized & affirmed(2) in this act, “aboriginal peoples of Canada” includes the Indian, Inuit and Metis peoples of Canada(3) For greater certainty, in subsection (1) “treaty rights” includes rights that now exist by way of land claims agreements or may be so acquiredNB: Provinces did not come on board as much as the feds, 91(24) is their exclusive jurisdictionHow do the first nations enter agreements? Treaties, recognition of title, duty to consult and accommodate route• In 1990’s BC began the treaty process.

i) Nisga’a Treaty (INALIENABLE LAND)• The only treaty that has been concluded so far. • Aboriginal title rights are defined as treaty rights • The tribe holds the land in fee simple • One of the main exceptions is that the land is essentially unalienable - foreigners can hold land

within the claim, but Nisga’a has the ultimate ownership.

ii) St. Catherine’s Milling Lumber v. Queen PC 1888 (USUFACTORY RIGHT) – N/AFacts: From 1670-1870 HBC had Crown rights to Rupert’s Land. In 1870 Fed purchased it from HBC and granted a timber lease to PL. Fed claims that it had acquired the land from the Ojibwa Treaty 3, and it was in their power to give timber rights. ON claimed it was Crown land, and it was provincial jurisdiction allocating the timber rights.Issues: What rights did the Fed acquire from Ojibwa in Treaty 3? – Natives did not have possession rights, thus were not able to give them away. The land is Crown landRatios: Aboriginal Title is a “personal and usufactory right (right of enjoyment)” over the land• FED: Ojibwa held the land in a fee simple sort of a thing, and were free to give it to the Fed in the treaty • ON: Ojibwa did not have fee simple, they merely occupied the land, and they did not have a right to give property rights to

anyone, since they did not have them to begin with. Treaty 3 was merely political. • PC: aboriginal have a “personal and usufactory right” over the land - occupation and use (hunting and fishing) of the land,

not an exclusive possession.

iii) White v. Bob 1960Facts: Hunting prosecution, one said Natives have a right (treaty right – Douglas treaty) to huntIssue: were these were political documents with no force or effect? BCCA ruled against thisDecision: BCCA agreed in 1964. Douglas treaties looked like a transfer deed (not like a treaty)

o They described the land, conditions on the transfer – and signed by the transferoro A transfer deed is a transfer of the interest in land signed only by the transferoro No signature anywhere by Douglas or any other Crown official

NB: this was the beginning of the law refusing to deal with title1927 Act prevented Aboriginals to bring litigation to title claims, undone in the 1950s, begin to see litigation in the 1960s

36

iv) Calder v. Attorney General of BC SCC 1973 (RECOGNITION OF ABORIGINAL TITLE)Facts: Nishka sought declaration that their aboriginal title had not been extinguished – wanted a definition of that title. No contesting of the fact that the Nishka were there before the settlers arrived.. The argument, as far as others are concerned is a legal interest. Argument by the government – either the title didn’t exist, or the title was extinguished by the land agreementsIssue: had the right been extinguished?Decision: 6 judges said aboriginal title existed, 3 said it had been extinguished, 3 said it had not been extinguishedRatios: Court recognized aboriginal title as a legal interest in law, led federal gov’t to realize it couldn’t legislate legal status away, and would have to negotiateComprehensive claims process: there are no treaties: we need negotiations that lead to treatiesSpecific claims process: e.g., the reserve wasn’t as big as promised, it was cut down arbitrarily, etc.

- E.g., Squamish claim to the reserve

v) R v. Sparrow SCC 1990 (JUSTIFICATION OF INFRINGEMENT TEST)Facts: Natives were caught fishing with a net that exceeded the allowed size. Upon being charged, they claimed that the restriction infringed on their aboriginal rights of s.35(1)Issues: Is this an infringement, and is it justified? - Crown: Federal Fisheries Act extinguishes FN rights Ratios: Regulatory infringement of aboriginal rights can be justified under certain circumstances

• SCC: for extinguishment to happen, the law must be clear and plain that it intends to extinguish • Fairness to FN is the governing concern (R. v. Agawa [1988] SCC)

• Rights that are recognized are not absolute: infringement can be justified • The onus is now on the Crown to justify the infringement • The infringement is justified if there is

Articulates three stage test for interpretation of s.35:1) Is there an aboriginal right2) Has that right been infringed?3) Is that infringement justified?

How to justify infringement – 2 part testi. Does it have a compelling and substantial justification

ii. Is furtherance of the compelling & substantial objective done in a manner that doesn’t violate Crown’s fiduciary duty?- Sparrow, conservation = compelling and substantial objective- Prevention of harm is a compelling and substantial objective

vi) R v. Gladstone SCC 1996 (FULL PRIORITY PRINCIPLE)Facts: Natives establish a commercial fishery, and are charged with selling fish caught under a FN licence. Issues: Is this an infringement, and is it justified?Ratios: Full priority principle applies only to aboriginal rights with inherent limitations• Aboriginal right to a commercial fishery is “without inherent limitation”: it could be extended indefinitely. • Aboriginal right confers priority, but is not exclusive • The application of the priority principle:

• R v. Sparrow, the aboriginal right had priority, since it was a right for food fishing and had an inherent limitation (one could catch only as much fish as was needed for food)

• In this case, the right is an economic right, and has no inherent limitation (there is no limit to how much fish one could catch) thus it does not fall under the full blown conception of the priority principle

• The capacity of the Crown to infringe the aboriginal rights in expanded to: Substantial and Compelling Interest An objective is valid if it is aimed at preserving s.35(1) rights aimed at the preservation and conservation of a natural resource. An objective is valid if its aimed at promoting a significant interest (fairness) in societyFiduciary Duty of the Crown In the context of commercial fisheries, the pursuit of regional and economic fairness is a compelling and substantial objective for infringement of FN rights

Priority Principle: who gets the first claim on the resource that is left over after the regulation?• FN rights with inherent limitations get first priority after conservation. Those without inherent limitations can be moved

down the list. Then Crown must demonstrate that allocation is respectful of aboriginal priority. (Gladstone) • Aboriginal Title has no inherent limitation.

Justification of Infringement Test : 1. The onus on the complainant to show that the right been restricted? 2. The onus is now on the Crown to justify the infringement if there is: a.

Compelling and Substantial Objective Examples: Preservation and conservation of a natural resource (Sparrow), preservation of economic fairness (Gladstone)

37

vii) Delgamuukw v. BC SCC 1997 (MEANING AND ESTABLISHMENT OF AT)Facts: In 1984, the chiefs file a collective claim for recognition of their ownership and jurisdiction over their territory. In appeal to SCC, the claims changed to ownership and jurisdiction and self governance. This sent the case back to the trial court. Lower courts dismissed the claim, and it went to SCC.Issues: What is the validity of Native oral histories? What should Aboriginal Title amount to?Ratios: The establishment and meaning of Aboriginal Title• AT is a right in land - a property interest - and as such, is more than a right to engage in specific activities • it is not restricted to a set of traditional uses, these do not define AT, but are included in it. • the difference of AT right in land from fee simple is that it precludes uses that will destroy the right . • Once this has been established, the Crown can justify its infringement of the aboriginal title

• this case confers an exclusive right to FN, thus the Gladstone analysis of commercial aboriginal fisheries applies here • the compelling and substantial objectives that allow infringement on the aboriginal title to land are:

• general economic development (e.g. agriculture, forestry, mining, hydroelectric, etc.) • settlement of foreign population

• but govts MUST accommodate the participation and prior interest of FN in the development of land and resources

• there is always a duty of consultation : its nature and scope will vary case by case, in some cases this may provide a veto

• compensation is relevant to the question of justification .

Requirements for Aboriginal Title:Underlying title lies with the Crown. The onus is on FN to prove title (R. v. Delgamuukw)1. Was the land occupied pre-sovereignty (in BC the landmark is the 1846 Oregon Treaty) 2. Were there Aboriginal laws that govern the land (based on oral histories) 3. Was there physical occupation and effective control of the land? (construction of dwelling, cultivation of fields, other

exploitation of the resources) (seasonal occupation is not enough) (no need for acts of exclusion) 4. Is there continuity of occupation? 5. Can the Crown justify the infringement of AT based on the Justification of Infringement test? (Sparrow, Gladstone)

Features of Aboriginal Title:• It is closely related to a fee simple • It is a property right (not personal and usufactory) • It amounts to exclusive use and occupation of the land • It is inalienability except to the Crown (based on Royal Proclamation) • It is sui generis (unique in origin) based on the history of the natives on the land and their prior occupation of it • It is held communally - no private ownership • It has a restriction - the uses of the land do not have to be traditional, but should not be repugnant to them - that is, they

should not preclude the possibility of the traditional use of the land. • But for the purposes of the Priority Principle, it has no internal limitation

viii) R v. Bernard; R v. Marshall SCC 2005 (ESTABLISHING ORAL TITLE)Facts: Charges of cutting down timber and possession of spruce logs taken from Crown land; Argued that as Mi’kmaq Indians, actions were legitimate by virtue of either treaty or aboriginal title – in which case they do no need prov authorization to logIssue: how do we establish aboriginal title? – need to establish exclusive occupation @ time of sovereigntyRatios: Aboriginal land must correspond with the common law claim, compare with the common law title to land, and comport with the common law title to land

Comport, correspond, compare• Acts of exclusion are not required as evidence - what is required is effective control and exclusive possession of the land. • Oral history accepted as evidence based on: A) Usefulness (evidence not otherwise available); B) Reasonable Reliability

(credibility of the person giving the history)

ix) Tsilhoqot’in Nation v. BC BCSC 2007 (HUNTING AND FISHING RIGHTS V. AT)Facts: Natives seek a declaration that they hold aboriginal title to their area.Issues: Is there aboriginal title or hunting and fishing right?Ratios: Difference between aboriginal title and hunting and fishing rights• The judge finds about half of the disputed area to be aboriginal title • The other half is seen as a hunting and fishing rights area • There is no “postage stamp” approach to title (scattered panoply of small sites) • A proper approach is that of a blanket coverage of the area: village sites, cultivated fields, and everything covered by a

network of trails and waterways. • It is only when public officials seek to engage the provisions of such legislation in relation to Aboriginal title that the

infringement occurs (this was done in this case)

38

91(24) Indian reserve lands – creates jurisdictional issues (e.g., Squamish reserve and false creep) o What’s the best way to allot property on reserves? What’s the mechanism? – certificates of possession allotted to

individual status Indians that entitles them to a lot on the reserve o Training wheels for fee-simpleo Can’t be traded outside the band, can’t be sold, flow from the Indian Act and Royal Proclamation (land can only be

alienated to Crown; but then can be allocated as Crown land)o These can be leased, however, long termo Pressure to open up certificates of possession, or entrench private property on reserves that look more and more like

fee simple interests Allow the band member to transfer their interest – you turn that interest into something of property and a

transferrable commodity that’s useful as money or security for a loano There are also hereditary chiefs attempting to maintain traditional property laws

x) Haida Nation v. BC BCCA 2002 (DUTY TO CONSULT AND ACCOMMODATE)Facts: Haida seek judicial recognition of aboriginal title. MacMillan Bloedel is given a tree-farm license on the disputed land. The license has to be renewed every once in a while, and in 1999 the company tries to transfer the license to Weyerhouser. Haida object to the renewal of the license, the transfer of it, and wants to be consulted. Issues: Does the province and Weyerhouser, have the duty to consult and accommodate the Haida?Ratios: Crown has fiduciary duty to consult & accommodate where aboriginal title is asserted but not proven.• The duty rests in the Honour of the Crown - the Crown is bound to act honourably in its relations with aboriginal people,

where the aboriginal title is asserted but not proven • The Honour of the Crown obliges the Crown to consult and accommodate the Natives where the title is asserted. • If the Crown contemplates an activity that may infringe on the not-yet-resolved title claim, the Crown has a duty consult

and accommodate: • If the potential infringement is high, and the claim is strong, then the duty is extensive - up to a veto • If the potential infringement is slight, and the claim is weak, then the duty is minimal

39

17) RegistrationThere are two possible approaches to registration:• A deed registration system :

• The actual deeds are held in a central registry; • Removes problems with private ownership of deeds; • But says nothing about the validity of those deeds: a registered deed can be inauthentic. • The deed registration system merely encourages registration. • Most common system is the “race-notice” system, where priority is accorded to an otherwise valid

subsequent interest if (a) the second interest is acquired without notice of the first and (b) the subsequent interest is registered first.

• A title registration system : • The essence of this is the concept of indefeasible title; • It provides conclusive evidence that the person in the register is the owner; • One need not investigate chain of title or question validity of interests;

a) Title Registration (Torrens System)• First appears in Australia in 1850s; BC is one of first places to adopt it in 1860’s • It is a system that guarantees title • MN, SK, AB and BC use Torrens system; ON is converting; Maritimes and USA largely still use deeds registration; thus

in States, where no guarantee, purchasers acquire title insurance; could even be used in BC if cheaper than legal fees of registration.

There are four main features;1. Registration Principle :

• Transfer does not occur until registered (s.20 LTA) • Title that is registered has priority over title that is not registered; • In BC, registration is not mandatory but there is strong incentive to do so; • Transferor is bound by transfer even if not registered, but unregistered interest is vulnerable to anyone else; • LTA s. 37 (1): an instrument is deemed to have been registered and to have become operative for all purposes in

respect of the title, charge or cancellation claimed by the application for registration, and according to the intent of the instrument or application, as of the date and time when the application was received by the registrar

• Only leases over 3 years are supposed to be registered; • Transfer Instrument LTA 185(1): transfer instrument must be in the form of a freehold title (Form A)

Legal description, price, transferors, nature of estate, signatures Only the transferor signs (NB: at common law the transfer instrument is the deed)

2. Indefeasibly Principle : • An indefeasible title is conclusive evidence at law and equity that person named has title of property (s. 23(2)

LTA); • registration means title cannot be revoked, defeated or voided despite any flaws in instrument or claim• Creelman v. Hudson’s Bay Insurance Co. (1920) PC: Contracted w/ HBC (registered holder) and sought to extricate

itself b/c they said HBC was not allowed to hold interest in land. PC says doesn’t matter, b/c of registration holder3. Abolition of Notice :

• Except in case of fraud, registration is not effected by notice (express, implied or constructive) (s.29(2) LTA); • Thus, bona fide purchaser gets title even if they have notice of prior interest. Notice of prior int = irrelevant. • Note that this is not so black and white in case law

4. Net Principle (Assurance Fund): • Establishes an assurance fund to compensate individual that are wrongly deprived of land through registration system

(part 20, s.295 LTA); • In case of fraud, if one would have had claim in common law (priorities) to recover that property, then the

assurance fund will compensate that person (s.296(2) LTA)

40

b) Indefeasible Title and FraudLTA 23(2): An indefeasible title, as long as it remains in force and uncancelled, is conclusive evidence at law and in equity, as against the Crown and all other persons, that the person named in the title as registered owner is indefeasibly entitled to an estate in fee simple to the and described in the indefeasible title

Statutory Exceptions to Indefeasibility Example:Sting purchased the fee simple interest in Z from Stew. There were no charges listed in the register against Stew’s fee simple interest. However, when Sting attempted to take possession of Z he discovered that Andy held a lease to the propertyWhen will Sting be able to take possession of Z in each of the following circumstances?Andy holds a 2-year lease that is set to expire in 18 months --- In 18 monthsThree years ago, Stewart granted Andy a 4-year lease --- Right now – lease exceeding three yearsAndy holds a 2-year lease, but is not occupying the premises-- Now, because there is not actual occupationAndy holds a 2-year lease with an option to renew for 2 more years -- Gets it now

LTA s.1 “Lease or agreement for lease for a term not exceeding 3 years if there is actual occupation under the lease or agreement” means a lease or agreement for lease for a term that, at its beginning, does not exceed 3 years if there is actual occupation under the lease or agreement, and, if an option or covenant for renewal is included in the lease or agreement, the option or covenant must not extend the total lease periods beyond three years

Fraud ExampleAndy held the fee simple interest in Z. String, believing that he was dealing with Andy, contracted to purchase the fee simple interest, However, he was actually dealing with Stew who was posing as Andy. Stew forged Andy’s signature on the transfer instrument (Form A) and Sting registered his interest. At this point, Andy discovers the fraud and claims titleCan Andy recover title….If Sting is a bona fide purchaser for value within a system of immediate indefeasibility? Take his title back If Sting is a bona fide purchaser for the value within a system of deferred indefeasibility system? Yes, deprived of interest, at common law would have recovered, deprived of interest because of the Act. Moment of indefeasibility is delayed until party acquiring interest is at least one step removed from the rogue neither Sting nor Andy would hold indefeasible title BUT the transfer to someone else would beWho is in the best position to know that there is a problem? – most likely the purchaser ; Puts the onus on the purchaser to establish they’re dealing with someone who is legitimateThere are two variations of the indefeasible title:• Immediate indefeasibility : buyer holds indefeasible title even if they acquire their interest in fraud, but bona fide. If B

buys title from rogue R who pretends to be owner O, B has the interest, and O liable to compensation. • Deferred indefeasibility : the title is delayed until the buyer acquires interest from the person who is the lawfully

registered owner, and is this at least one step away from fraud. If B buys title from rogue R who pretends to be owner O, O gets title back & B is compensated. But if B sells to C before fraud is discovered, then C holds title, and O only gets compensation.

i) Lawrence v. Wright ON 2007 (Deferred indefeasibility vs Immediate indef)Facts: PL owns a house, which is mortgaged from TD Bank for $100,000. A rogue pretends to be her, sells the house to his buddy D for $300k. D mortgages the house to Maple Trust (MT), pays off TD mortgage, and tries to bugger off w/ $250k.Issues: MT in good faith acquired registered legal interest in the house. Is the mortgage then valid and enforceable against the true owner of the property, even though it was acquired by fraud?Ratios: Deferred Indefeasibility is preferred for policy reasons, and should be the proper reading of ON LTA

• PL: Only the true owner of the land can grant an interest: nemo dat principle • MT: Immediate Indefeasibility: they are the bona fide purchaser victim to fraud. • ON :Deferred Indefeasibility: only a purchase twice removed from fraud (deferred) is safe in its title.

• MT is not the deferred owner, as it is only once removed from the fraud, and has no claim on the title. • MT was only once removed from the fraud, and had a chance to investigate.

• Court: Both interpretations can be inferred form the wordings of the LTA : • Immediate: s.78(4) says that an instrument is deemed valid on registration, which overrides s.155 which

renders fraudulent transfers void, but “subject to provisions of the act” (which s.78(4) is) • Deferred: s.68(1) says that only registered owner can transfer land. D was not the registered owner, since he

obtained the title by fraud (s.155). So his transfer to MT is void. But MT registered bona fide, and is the registered owner. So if they were to transfer it to a third party, then by s.68(1) and s.78(4), the third party would have full title.

• But, deferred indefeasibility is preferable for policy reasons, places the burden not on innocent homeowner who has no chance of knowing that they’re victimized, but on money lender who has a chance of investigating the title.

• Also, the only remedy available to homeowner who gets evicted under immediate indefeasibility is the money from

41

the fund, which only recognizes the monetary value of the house. What about personal value?

Immediate Indefeasibility BCLand Title Act s. 25.1 (1) registration of a void instrument does not acquire any estate or interest in the land on registration of the instrument (restatement of nemo dat principle acquire nothing if you have nothing to transfer)o (2) even if void, bona fide purchaser for value is deemed to have acquired that estate on registration of that

instrument (fee simple) prospective transferso (3) everybody already in system who acquired on basis of void instrument is deemed to have acquired that interest

transfers already completedThis section establishes immediate indefeasibility framework in BCLanguage is a little bit different than s. 23(2)o conclusive evidence at law and in equity state guaranteeo “is deemed” -> rebuttable presumption: just have show that they acquired on the basis of a void instrument -> would

acquire nothing. Piece of evidence that might refute the presumption that you might have used to rebut the presumption is not available to you because s. 25.1 states explicitly that it doesn’t matter that you acquired fee simple estate from a void instrument

o Language is diff. but essentially does same thing as s. 23(2) b/c there is NO WAY of rebutting presumption!

c) Abolition Notice and FraudCommon Law: Bona Fide purchaser for value of a legal interest w/out notice of a prior equitable interest will take that legal interest free & clear of prior equitable interest. If you have notice of prior interest, then you take int subject to prior interestOne of core principles of registration is to abolition notice

- s. 29 -> not affected by notice except in the case of fraud- What does it mean to act fraudulently with respect to notice?

o Confusion is over “except” in the case of fraud is fraud as understood in equity or in common law courts fraud under courts of equity included notice it was fraudulent to take a subsequent interest

that was not encumbered by prior interest if you had notice of that prior interest common law courts required deception, intent to deceive

o Equitable or common law fraudLease or agreement for lease for a period not exceeding 3 years if there is actual occupation under lease or agreement

4 Things to Keep in Mind with Respect to Fraud:1) What type of notice?

- Express? (see transfer instrument) ***courts in BC most likely to find fraud when there is express notice- Implied/imputed ? (know through their agent)- Constructive? (ought to have known, should have investigated)

2) What is the unregistered property interest?- Is that unregistered interest a charge or is it the contract of purchase and sale of a fee simple interest?

o s. 29 captures botho Courts more likely to find that notice amounts to fraud if the unregistered interest is a fee simple interest o Ex: former owner took interest and transferred to a party who didn’t register, another party offers better

price (if they knew that there was an existing contract) courts will be more inclined if interest is fee simple interest

3) When did the purchaser have notice? Before or after the contract of purchase and sale?- If purchaser had notice before they entered into contract of purchase and sale, more likely to matter than if they

discover after entering contract (changed their position in reliance of the registry)4) Is notice alone sufficient to constitute fraud?

*** Assurance fund analysis (s. 23, 25, 26) separate than s. 29 analysis ***- s. 29: Fraud specifically related to notice (nothing to do with assurance fund)

o if there is fraud, purchaser acquires nothing and original owner gets property back if there is notice and no fraud, purchaser acquires property but there is no fraud if there is fraud, title goes back to true owner whether notice is sufficient to constitute fraud…

o fraudster couldn’t claim from assurance fundo no void instrument but whether notice amounts to fraud

- Assurance fund is only triggered when there is fraud -> instead of getting property back, you get compensationo void instrument, forged document

i) Holt Renfrew & Co v. Henry Singer Ltd. ABCA 1982Facts: The Edmonton Holt Renfrew has registered a lease under a caveat. After several renewals, they sign a17 year

42

unregistered lease. D enters into negotiations to purchase the building, subject “only to the encumbrances noted on the certificate of title”. After the purchase, D filed a caveat with an intention of defeating the unregistered lease. PL filed one back in response. During investigation, it was discovered, that D considered buying the company owing the building, until he discovered that the lease is unregistered - thus it would be much easier for him to buy the property and override the lease by registering a caveat.Issues: Was this fraud? – No, judgement for DRatios: Notice may be evidence of fraud but is not sufficient. Something additional required.• S.203 posits that except in cases of fraud, no person is bound by duty to inquire into the nature of the title. • Knowledge of an unregistered interest and that it will be defeated by concluding the transaction are insufficient to

constitute fraud. There must be an additional element. • Therefore bona fide purchaser gets title even if they have notice of a prior interest. Notice of a prior interest is

irrelevant. • The intention of the transferor may not be definitive in determining what was transferred. • Misrepresentation may constitute fraud if there is reliance on the statement. • Timing of notice may be important. Notice before entering K is worse than notice after but before transfer.

ii) AB Ministry of Forestry, Land and Wildlife v. McCulloch ABQB 1991Facts: Svedberg acquires fee simple but Crown retains right to repurchase at a fixed price. Svedberg goes into receivership and receiver sells land to D for $62,000. The right to repurchase had been registered as a caveat but in the transfer to D the caveat was accidentally discharged. D realizes this and quickly transfers the fee simple interest to a numbered company (presided by D), to avoid the caveat from being reinstated. The government reregisters the caveat.Issues: Did the transfer by which the numbered company acquired the title from D amount to fraud? Yes, judgement for PRatios: In AB’s LTA notice alone is not fraud. For fraud to happen, notice must be used for an unjust purpose.• BC LTA s.29(2) abolishes notice but does not indicate that notice itself is not fraud. • AB LTA explicitly requires notice and an additional act. • Might be rationalized on the grounds that the transferee knew the D was breaching a K with the Province by

transferring title to the company when the province had a right of purchase. • In this case, the company had notice, since it was owned by D. • Notice alone is not fraud. For fraud to happen, notice must be used for an unjust purpose . • Notice plus an act done explicitly to defeat the unregistered interest may be considered fraud . • Using knowledge of an unregistered interest for an unjust or inequitable purpose may constitute fraud. • In this case, the fact that D transferred the interest to his company as soon as he found out that his interest was

encumbered, indicates he was deliberately trying to evade his obligations to Crown. So this is clear fraud. When transferor & transferee = same ppl, notice of a prior unreg interest may be considered more than mere knowledge.

Caveat: a registered charge that warns the future purchaser of the fact that someone else’s interest already has priority. The Registrar cannot deal with the property without first notifying the caveator.Charge: any interest in the land, which is less than a fee simple.

iii) Hudson’s Bay Co. v. Kearns Rowling BCSC 1896Ratios: notice of the title of another is guilty of fraud: early decision that defined fraud as equitable (notice amounts to fraud)

- Seems to undermine the title registration system (should not have to worry about what is not in the registry)

iv) Szabo v. Janeil Enterprises Ltd. BCSC 2006Facts: PL holds fee simple to Lot A. Some wench has fee simple to neighbouring Lot B. There is a pipe that runs from B to A, but there is no easement. In 1991 the previous owner of B gave PL a “water easement” in exchange for a “hydro easement”, but forgot to register it. It remained unregistered when wench bought LotB. P wants specific performance of easement agreement.Issues: Can the unregistered easement be upheld even though there was notice?Ratios: Notice will only constitute fraud for s.29 if there is an element of dishonesty on the part of the transferor.• Wench claims benefit of s.29 of LTA that protects purchaser from previous unregistered interests. • Is mere notice sufficient to bring a purchaser within fraud exception of s.29, or is some further participation required? • Actual notice of a prior unregistered interest may be sufficient to bring a purchaser within the fraud exception, but

only if there is an element of dishonesty in the conduct of the purchaser.• Wench had constructive notice • But fraud cannot be presumed, it must be explicit. • Knowledge of previous dealings on the matter may lead to a finding of constructive notice.

Three steps to work through to establish notice:1. What type of notice is required to establish fraud? Express or constructive? 2. When did the purchaser have notice? 3. Is notice of a prior interest sufficient to amount to fraud, or is some additional act

43

required? According to Szabo, to claim protection under s.29 of BC LTA one must answer two questions:

(a)whether the suspicions of the petitioner were aroused, and (b)whether the petitioned did all which was appropriate in the circumstances.

But Szabo is just suggesting that we are moving in the direction, as it is a BCSC case and can be overturned.

*There is a difference of what fraud means in the context of notice, and in the context of charges and fee simples. In notice, fraud has a much smaller threshold of dishonesty, and is much simpler to find.

18) Charges and Fraudulent TransfersCharge: any interest in land less than a fee simple o registered against fee simple interesto lease, mortgage, restrictive covenant

LTA s. 26(1) a registered owner of a charge is deemed to be entitled to the estate, interest or claimo deemed to be entitled

i) Credit Foncier Franco-Canadian v. Bennett BCCA 1963Facts: D are registered as owners of estate in fee simple. There land is fraudulently mortgaged out to Todd Investments by Allen, one of its employees. This mortgage is then resold to Stuart, who passes it on to PL. PL contacts D notifying them of assessment, but Ds ignore it as a mistake. No payments are made, and PL brings an action against D for foreclosure.Issues: What happens? Defendant gets landRatios: Registered owners of a charge acquired through fraud, or having its root in fraud, is subject to the claim of the person wrongfully deprived of the interest.• PL is a second bona fide purchaser of the property, they claim that their mortgage is valid.

• They rely on s.26(1) saying that every registered owner of a charge is deemed entitled to the estate or interest • Thus, the mortgage is a valid charge • There is owing, according to the instrument, the amount of $7,400 and interest.

• The validity of this depends on the words “shall be deemed”, which means “rebuttably presumable ” • D is guaranteed their rights under s.23(2), which says that registration is “conclusive evidence” of their ownership • So s.23(2) overrides s.26(1) • Either way, mortgage is only a security for the money owned, and Ds did not actually get any loan.

ii) Canadian Commercial Bank v. Island Realty Investments Ltd. BCCA 1988Facts: Park Meadows is the registered owner of land in Kelowna. Imperial Life holds a first mortgage on the land. PM grants a second mortgage to D (Island Reality) for $240,000. After this, PM approached PL (Almont Mortgage) to take a third mortgage on the land, on the understanding that the one to D will be discharged. This was agreed and registered. The D mortgage was then registered as discharged, but the discharge was a forgery. The owner of PM takes off with the money, and PM goes into bankruptcy. The land is sold, but is insufficient to cover both mortgages to D and PL.Issues: Who gets dibs on the money? P gets dibsRatios: Priority of charges depends on the order of their registration.• D asserts that their charge was valid, and only they could discharge or transfer it away. The charge to PL was invalid,

as it was based on forged documents. Ergo, D gets the dibs on the mortgage. • But PL was a bona fide purchaser for value, and it would go against principles of the registration system if they got shafted. • Furthermore, PL did not have to get the charge from D, but from PM who was the registered owner. • The Credit Foncier principle does not apply here, since PL got their charge directly from the owner, not through a series

of transactions rooted in fraud. • So apparently once D’s mortgage was discharged, it no longer affected the land (s.227) and PL’s mortgage became the

second mortgage. • Even though the discharge was fraudulent, it was still legit, and PL moved up from being the third mortgage in the registry

to the second one.

iii) Gill v. Bucholtz BCCA 2009 (Charges and Nemo Dat Principle)Facts: A rogue is acting in conjunction with PL pretends to be a property owner and fraudulently transfers the property to PL. The transfer is registered. Then PL registers a mortgage against the land with D. Following this, PL executes a second mortgage with an investment company IL. Neither of the two knew of PL’s fraud in acquiring the title.Issues: Are the mortgages enforceable as they are bona fide for value? The Mortgages are enforceableRatios: The LTA preserves the Nemo Dat maxim when it comes to charges.• LTA S.23(2) gives a registered owner indefeasible title in fee simple, subject only to the rights of one deprived of land to

show forgery and fraud. • On the face, it does not apply to any lesser interests. • S.26 says that a registered owner of a charge is deemed to be entitled to the interest • Crefit Foncier principle shows that “deemed” is subject to “conclusive evidence”

44

• The LTA preserves the nemo dat rule in respect to chargers - even where the holder of a charge relies on a registered interest, and deals bona fide, if the person they deal with is fictitious, then their interest is void.

• So the mortgages in this case did not get any interest, as they dealt with someone who had no such interest to give. • The LTA appears to have adopted the policy that the cost of frauds perpetuated against mortgagees and other

chargeholders should be borne not by the public (as the holders of the Assurance Fund), but by lenders themselves. • So now (at least when it comes to charges) BC is in agreement with ON as per Lawrence v. Wright.

SUMMARY:Bona fide purchaser after fraud in immediate indefeasibilityORIGINAL TITLE > FRAUD TITLE > VALID TITLEBona fide purchaser after fraud in deferred indefeasibilityORIGINAL TITLE > FRAUD TITLE > VOID TITLE > VALID TITLECredit Foncier:ORIGINAL TITLE > FRAUD MORTGAGE > VOID MORTGAGEGill v. Bucholtz and Lawrence v. WrightORIGINAL TITLE > FRAUD TITLE > VOID MORTGAGE

X. Land Title Act BCSection Summaries:20(1) Transfer does not occur until it is registered.23(2) A registered title is conclusive evidence that the person is the owner 23(2)(i) A person fraudulently registered is subject to the rights of the real owner 25.1(1) A void instrument does not acquire any interest25.1(2) A bona fide purchaser for value in fee simple is deemed to acquire the title even through a void instrument 26(1) A registered owner of the charge is deemed entitled to the estate26(2) A registered charge does not constitute evidence that it is an interest in land that is enforceable 27(1) A charge is notice of interest on the registered title29(2) Except in cases of fraud, a notice of an unregistered interest is of no consequence on the buyer 37(1) An instrument is deemed registered when it is submitted to the registrar296(2) A registered owner deprived of interest in land by fraud through conclusiveness of the registrar and who would have had a cause of action under common law, may proceed in court for the recovery of damages

297 s.296(2) is only available to the original owners, not to subsequent purchasers from fraud

19)Non-Proprietary Interests- Alberta cases talked about caveats (what we call charges)- in BC, a caveat is not an interest in land and does not create an interest in land

o notice of a claim to an interest in landLand Title Acts. 282 (1) if you have a claim that you can’t register but you want to put the world on notice that you have a contract of purchase and sale

- you have a claim to interest but you cannot yet claim full title because transfer has not occurred s. 288 effectively, filing a caveat freezes what can happen to land (anything else filed, subject to the caveat)(2) everything stops once the caveat is in the system s. 293 – caveat is a temporary notice mechanism have 2 months to close deal and register title substitute for doctrine of equitable notice s. 215 – if you need more than 2 months or if you’re in the midst of litigation, can register certificate of pending litigations. 216 (1) effect of certificate freezes what can happen the land(2) still window in which you can continue to register titles so long as you accept that later registered interests will be subject to resolution of pending court cases. 37 (1) – if claim is established, title deemed to have been registered at the date the caveat was received

- for priority, person who lodged caveat has priority from moment when they filed the caveat- mechanism for securing your priority

i) Skeetchestn Indian Band and Secwepemc Aboriginal Nation v. Registrar of Land Titles, Kamloops BCCA 2000

Facts: Skeetchestn claim title to golf course in Kamloops (used to be a ranch -> seemed to be able to coexist in that space). Skeetchestn sought to file a certificate of pending litigation: claimed interest in land and sought to register that claim in title registration system against the ranch. Trying to use title registration system to stop develop of the ranch (certificate would

45

have frozen development)- interesting strategic decision to try to use the title registration system to halt development on the landIssues: was this an interest that could be registered? can aboriginal title be registered in title system?Ratios: Aboriginal Title sui generis interest in land (Delgamuukw) Is it an interest in land within meaning of Land Title Act?Looks to history of title registration system no right to use title registration system because when it was set up, interest in the land did not include aboriginal title