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Considerations for Buying Rural Properties
Disclaimer: This article is intended for the purpose of providing information on rural property in Ontario and is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive. Updated October 2023.
Driven by rising house prices and the COVID-19 pandemic, more than 64,000 people left Toronto between mid-2020 and mid-2021. Many families are reevaluating their situations and are seeking greener pastures, quite literally.
Rural properties are becoming more popular as people are looking for more space and a slower pace of life. If you’re considering making a move to the country, there are a few things you should keep in mind.
There are considerations that you will want to consider for your family. For example, if you work from home, consider the internet quality and reliability in the area. If you have children, consider the schools and extra-curricular activities that are available. Don’t forget to account for the extra-long commute when you do need to go to the office.
However, from a legal standpoint, there are also differences in purchasing a rural property compared to an urban or suburban one. In this article, we will outline those unique requirements.
That includes:
- Road and waterfront access
- Septic systems
- Water tests
- Shared wells
- Planning Act contraventions
- Surveys and boundary issues
Of course, we encourage you to book a call with our team as soon as you have made an offer on your next dream home. We’re here to help and would be more than happy to answer any questions you may have.
Accessing Your Dream Home
You may have found your dream home, but can you access it?
Road access can be a critical concern, especially for waterfront or vacation properties. Sometimes, the access road or driveway crosses private land, and there may be no guaranteed legal right of use. Responsibilities for road maintenance are often unclear, creating the risk of access restrictions or unexpected repair expenses.
Your lawyer’s title search may involve tracing legal access through private properties to connect to a municipal road. Title insurance can help resolve access problems, but it’s not always available.
In Ontario, many bodies of water are encircled by a shoreline road allowance owned by the Crown. Typically, municipalities sell this road allowance to property owners. If this applies to the property you’re buying, it might encompass multiple parcels and PINs (Property Identification Numbers).
When reviewing a legal description that references a past instrument number, your lawyer will have to verify that it covers all the land you expect to acquire.
For properties where the shoreline road allowance hasn’t been purchased and conveyed, inquire about the proximity of any improvements to the water’s edge. Suspicion of encroachments onto the shoreline road allowance should prompt consideration of obtaining a survey.
Septic Systems Inspection
When you are buying a rural home that has a septic system, you will want to do a septic system inspection. In fact, your lender will usually required that it be done before approving your mortgage.
Many homeowners that are selling will provide it automatically, but if not, you will need to get this done.
The septic systems inspection will check items such as the size of the septic tank, the location of the leach field, and the condition of both. The inspector will also look for any signs of damage or leaks. This is important because if there are any problems with the septic system, it can be very expensive to fix.
Water Test
Another inspection that you will need to have done is a water inspection. If your home has a well, then you want to make sure that the water that you are getting is safe. Poor water quality can cause health problems, taste unpleasant or be costly to treat.
Therefore, if the seller does not provide this information to you, you will need to have a water inspection conducted to ensure that your water is not contaminated. Your realtor or our team can direct you how to have those tests completed.
Shared Wells & Shared Well Agreements
Rural real estate transactions can present unique challenges, and one such complexity involves shared wells. In rural areas, properties might rely on wells, some of which are shared among neighbors.
If you’re considering purchasing a property with a shared well, there are several crucial considerations.
Shared Well Agreement: Verify if there is a shared well agreement in place. The absence of such an agreement can lead to disputes and confusion regarding maintenance, repairs, and water usage responsibilities. Ensure there’s an agreement before finalizing your purchase.
Existing Shared Well Agreement: If a shared well agreement exists, obtain a copy and review it with legal counsel to understand your rights and obligations. The agreement should outline maintenance, cost-sharing, and water usage limitations.
Well and Water Quality: Assess the condition of the shared well and the water quality. If issues arise, negotiate repairs or upgrades with other parties sharing the well.
Risks and Limitations: Understand the potential risks of shared wells, such as contamination or overuse. Shared well agreements can restrict property modifications, so consider how they impact your future plans, such as pool installation or well expansion.
Title Restrictions: Unlike shared driveways, shared well agreements are typically not registered on property titles. However, it’s advisable to have such agreements prepared and passed from owner to owner.
Learn more about shared wells here.
Planning Act Contraventions
Because rural properties are generally not part of a plan of subdivision, our team will check for any Planning Act contraventions as part of our title search process.
Surveys
If you are purchasing a property that is either zoned agricultural or mixed-use, you will likely need to have a survey done before purchasing the property.
Otherwise, you may opt to have a survey done to be sure of the property boundaries. This is especially true if your property is large and open, with no fencing to mark those boundary lines.
This is something that you can discuss with your realtor or our team. Surveys can take months to complete, so unless it is zoned, as noted above, you can have that completed following your closing date.
Make a Move: Buying a Rural Property in Ontario With Beeksma Law
As you move out to the country, be sure to take the proper legal steps in your move. With offices in Hamilton and Owen Sound, Beeskma Law is poised to be able to handle your transition from urban to rural living. Our team is experienced in rural property transactions and would be more than happy to help you with any questions that you may have. Contact us today!
Should you have trusts in your estate planning?
Disclaimer: This article on testamentary trusts is intended for the purposes of providing information only. It is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive.
Estate planning is an important part of financial planning that involves making arrangements for the management and distribution of your assets after you pass away.
A trust is a legal arrangement that allows you to transfer ownership of your assets to a trustee who manages and distributes them according to your wishes. Trusts can be a useful tool for estate planning, providing several benefits that can help you achieve your goals. (For more information about the types of trusts, check out this article)
In this article, we will outline three reasons why you might consider adding trusts to your estate plan.
Why Consider Testamentary Trusts: When You Want to Keep the Details of Your Estate Private
One of the main advantages of using a trust is to help you maintain privacy. Unlike a will, which becomes a public document when it is filed with the court, a trust can be kept private.
When you transfer ownership of your assets to a trust, those assets are no longer considered part of your estate and are, therefore, not subject to probate. This means that the details of your estate, including the nature and value of your assets and the identities of your beneficiaries, remain confidential.
Privacy can be especially important if you have complex or sensitive family dynamics. For example, you may not be gifting to your children equally. Whatever the reason, you may want to keep the details of your estate plan private to avoid conflicts or misunderstandings. A trust can help you achieve this goal by keeping your wishes confidential.
This is also true if you want the size of your estate to be kept private. By transferring ownership of your assets to a trust, you can avoid the public process of probate, allowing you to keep the size and details of your estate private.
Why Consider Testamentary Trusts: To Care for Children or Dependent Adults
Another reason why you might consider adding trusts to your estate plan is to provide for the care of your children or dependent adults. If you have minor children, for example, you may want to create a trust to provide for their financial needs in the event of your death. A trust can be set up to manage and distribute assets on behalf of your children, ensuring that they are cared for and that their inheritance is protected.
Many parents opt to create a graduated trust for their minor children. This means that the trust is distributed on a graduated schedule as the children reach certain ages. At that point, the trust can be dissolved and the remaining assets given to them outright.
Similarly, if you have a dependent adult in your life, such as a child with special needs or an elderly parent, you may want to create a trust to provide for their ongoing care. A trust can be set up to provide for their living expenses, medical care, and other needs, ensuring that they are well-cared for after you pass away.
Why Consider Testamentary Trusts: To Avoid Probate
Another reason why you might consider adding trusts to your estate plan is to avoid probate. Probate is the legal process that occurs after someone passes away, during which their assets are distributed according to their will or, if they die without a will, according to provincial intestacy laws. Probate can be a lengthy and costly process, as it involves court fees, legal fees, and other expenses.
By setting up a trust, you can transfer ownership of your assets to a trustee, who manages and distributes them according to your wishes. Because the assets are no longer considered part of your estate, they are not subject to probate. This can help your beneficiaries avoid the costs and delays associated with probate, allowing them to receive their inheritance more quickly and efficiently.
Additionally, estate tax is imposed on estates that exceed a certain value. By setting up a trust, you can reduce the size of your estate and help lower your estate taxes. (Of course, you’d want to talk to your accountant or financial planner about how to maximize the tax savings you can achieve with a trust.)
These are just some of the reasons why you might consider adding trusts to your estate plan. With careful planning, you can use trusts to achieve your goals while ensuring that your beneficiaries are taken care of after you are gone.
Smart estate planning with Beeksma Law
Trusts can be a powerful tool for estate planning, providing several benefits that can help you achieve your goals. If you want to maintain privacy, provide for the care of children or dependent adults, or avoid probate, adding trusts to your estate plan may be a wise choice.
However, it’s important to seek professional advice when setting up a trust. There are many different types of trusts available, each with its own advantages and disadvantages. A qualified estate lawyer can help you navigate the complexities of estate planning and create a plan for your unique needs and circumstances.
At Beeksma Law, our team of experienced lawyers has the knowledge and expertise to create a comprehensive, personalized estate plan. Contact us today to learn more about how we can help you with your estate planning needs.
A Beginner’s Guide to Trusts in Estate Planning
Disclaimer: This article on estate trusts is intended for the purposes of providing information only. It is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive.
We have talked about estate planning, estate planning for blended families, your powers of attorney and your will. Now it’s time to talk about trusts. In this beginner’s guide, we’ll explain what trusts are, how they work, and their use in estate planning.
What is a Trust?
Trusts are the unsung heroes of estate planning. They can be used to pass on assets, manage those assets, determine how they are distributed and much more.
A trust is a legal entity that allows someone (the settlor) to transfer assets to a trustee. The trustee holds the assets for the benefit of one or more beneficiaries. They have legal ownership of the assets, but the beneficiaries have an equitable interest in the assets. The trustee is responsible for managing the assets and distributing them according to the terms of the trust.
Depending on the tax considerations and other factors, the settlor and trustee may be the same person. Additionally, either or both could also potentially serve as beneficiaries in certain cases.
How are trusts created?
There are two broad categories of trusts. Trusts can be created during the settlor’s lifetime (an inter vivos or living trust) or when they die (a testamentary trust).
The terms of a living trust are typically set out in a document that the settlor signs. It appoints a trustee (or trustees) and directs how assets should be held, managed and distributed. An inter vivos trust is created once you determine the terms of the trust and the beneficiaries, and property has been transferred to the trustee to hold in accordance with the terms of the trust.
A testamentary trust, on the other hand, is created once someone has died. It can be created pursuant to a will. It can also be created pursuant to a beneficiary designation made under an insurance policy, a registered retirement savings plan or a registered retirement income fund. The important thing is that a testamentary trust comes into existence when the settlor dies.
The trustee’s role
The role of the trustee in an estate planning trust is a critical one. The trustee is responsible for carrying out your wishes and managing and distributing the assets according to the terms that you have outlined. As such, it’s important to choose a trustworthy and capable individual or organization as your trustee.
The trustee’s primary responsibility is to manage and invest any assets placed into the trust. This includes making sure that all taxes due on income generated from those investments are paid on time, as well as properly filing any necessary tax returns related to them.
Depending on how they’re structured, the trustee may also have to make distributions at certain times or under certain conditions. The trustee has an obligation to exercise reasonable care when managing these assets and to act in the best interests of the beneficiaries.
Many of the same principles that we spoke about with regard to choosing an executor also apply here. When selecting a trustee, you should choose someone you trust and who is capable of carrying out their duties. Additionally, if you plan to have your spouse or another individual serve as a trustee, it’s important to also name one or more successor trustees, just in case.
Set up your estate planning with Beekmsa Law
At Beeksma Law, we believe that trusts do not get the attention they deserve. We are experienced in helping our clients create trusts that will protect their assets and carry out their wishes, both during life and after death.
We know how important it is to plan ahead. You have to do so to protect your hard-earned assets, provide for those you love, reduce taxes and make sure your wishes are followed. Whether you’re considering setting up a living trust, a testamentary trust or any estate planning tool, we can help. Contact us today to get started!
Do you understand your commercial lease agreement?
Disclaimer: This article on commercial lease agreement in Ontario is intended for the purposes of providing information only and is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive.
Our office has been receiving more and more inquiries recently relating to commercial leasing disputes. This is to be expected to some extent – after all, we are in a recession – and we want to make sure that all of our clients are aware of their rights and responsibilities when it comes to their leases.
Of course, every situation and lease is unique. If you would like to discuss your lease, please get in touch with our office as soon as possible. We are well-versed in commercial tenant law, and we can provide you with advice and guidance on how to proceed.
Your Commerical Lease Agreement in Ontario
Many landlords reach out to us because they are having significant difficulties with their tenants, such as their tenants defaulting on rent or not following the terms of their lease. What are your options?
Well, what does your lease say? Generally speaking, your lease is going to be your ground zero. If you have a well-prepared lease, you have more options. On the other hand, if you do not have a strongly worded, clear, and enforceable lease, you have fewer options.
The reality is that there are not a lot of protections under common law or in the legislation, specifically the Commercial Tenancies Act. Your lease is your best form of protection. We cannot overstate it enough: if you are not sure if your lease will protect you from a difficult tenant, you do not want to wait until there is an issue to find out.
Most savvy commercial landlords have an exceedingly good lease that gives them all the rights and “hold the cards,” so to speak. So what does that mean for tenants?
Signing a commercial lease as a tenant
You may be so excited to find the perfect space for your growing business that you are ready to sign anything. However, you need to ensure that the terms of the lease protect you and your business as much as possible.
You have rights as a tenant, but if you sign away those rights when you sign your lease, then you cannot avail yourself of the remedies provided for in the Commercial Tenancies Act. You must understand what you are signing and the lease must be able to also serve your interests.
That is where we come in. Before you sign your rights away, talk to our team. Too often, we see great businesses with their hands tied by a landlord-provided lease, and we do not want that for you. We can help you understand what the terms really mean and negotiate the terms that will hold your business back.
Protecting your interests with Beeksma Law
At Beeksma Law, our comprehensive experience covers both sides of the table. For landlords, we can help with drafting and enforcing your leases. For tenants, our experience helps to ensure that your rights are protected while you sign a lease.
We believe in empowering our clients. When you are armed with knowledge, you can make informed decisions that are in the best interests of your business. We clearly explain the law and ensure you understand what is at stake before signing on the dotted line. Book a call with our team today – we are happy to hear from you!
Navigating Construction Liens in Ontario
Disclaimer: This article on Navigating Construction Liens in Ontario is intended for the purposes of providing information only. It is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive.
Construction liens are on the rise in 2023. As we mentioned in an earlier article, this is to be expected as litigation will increase during economic uncertainty. This also extends to construction liens. The good news is that you can protect yourself and your business by understanding:
- what a lien is,
- how it works, and
- when to act before the situation gets out of control.
As with all business matters, protecting yourself comes down to two actions: understanding your rights and working with someone to help you both prevent and react to a lien.
What are construction liens?
A construction lien is a legal claim that one party registers against a property that is undergoing construction or renovation. It’s a form of security for payment that ensures that you pay the contractors and subcontractors for the work and the materials supplied. The lien gives the claimant the right to sell the property to recover the money owed to them.
The Ontario’s Construction Act governs construction liens. It sets out the rules and procedures for registering and enforcing liens in Ontario. The Act applies to all construction projects, whether they’re residential or commercial and whether they’re new builds or renovations.
How do construction liens work in Ontario
A construction lien is a powerful tool that can have serious consequences for both property owners and contractors. Here’s how it works:
- A contractor or subcontractor who has provided services or materials on a construction project and has not been paid can register a lien against the property.
- The claimant must give notice of the lien to the property owner and other interested parties, such as the mortgage lender.
The lien must be preserved (by registering it on title or providing a notice of lien) within a specific timeframe. That timeframe is now 60 days after the last day of work or supply of materials. It was previously 45 days, but this changed as of October 1, 2019. Once a party registers a lien, the property owner cannot sell or mortgage the property until the lien is resolved.
The claimant (the person who registered the lien) must “perfect” the lien within 150 days of the last day of work or supply of materials. Perfecting the lien means commencing legal action to enforce the lien.
Protecting yourself as a contractor
As a contractor or subcontractor, it’s important to protect yourself from non-payment.
One of the best ways to protect yourself is to make sure that all contracts are in place before starting any work. The contract should clearly define the scope of the project, payment terms, deadlines and other relevant details, such as who owns any materials provided by the contractor.
Having an enforceable contract in place will help avoid disputes down the line if there is ever an issue with payment. It’s also important that you make all payments on time according to the schedule in your contract to minimize any potential delays or issues further down the line.
It’s important that you keep careful records. If you find you’re having difficulty collecting payment from a client or are getting a run-around, you will be ready to register a lien against the property owner. You will also need to be organized when it comes to ensuring that you register within 60 days. The courts will hold to that deadline, so make sure you do everything necessary to ensure you register your lien in a timely manner.
Protecting yourself as a property owner
If someone registers a lien against your property, it is a serious issue and can have a major impact on your ability to sell or mortgage the property. Outstanding liens delay a project, or, even more seriously, financial institutions may even freeze loans or lines of credit.
The only remedy that you, as a homeowner, have against a construction lien relates to the work done. Did the contractor complete the requested work? If the contractor did not complete the work, then you may have grounds to dispute the lien.
It’s important to note that the standard is not whether or not the contractor completed the work to your standards. It is whether or not they did the work under the contract to the level of a “reasonable contractor”.
You can also include in your contract a “holdback”. This means that you can withhold a specified amount of funds from the contractor until the lien has expired or been released. It is important to consider this option as it may give you some protection against construction liens in the future. For example, if a subcontractor registers a lien for non-payment by the contractor, you can use the funds in your holdback to cover part or all of that subcontractor’s claim.
Of course, always make sure that you do your research and hire a reputable contractor before commencing any construction project.
Dealing with construction liens: Don’t wait!
As with most legal matters, the more proactive you are, the better. Whether you are disputing work done to your home or waiting for payment as a contractor, do not wait! Contact us right away to ensure we can resolve it in a timely and cost-effective manner.
Whether you are a contractor or property owner, understanding construction liens and how they work is important in order to protect yourself from potential financial losses. At Beeksma Law, we help our clients deal with construction lien matters and can provide you with the legal advice that you need. Contact us today for more information. ?