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The Lay of the Land


Bhasin Two Years On: The Impact of Bhasin v. Hrynew on the Practice of Canadian Commercial Real Estate Law

Posted in Commercial
Anthony SalandraBen Leith

Edited and approved by Ben Leith

In 2014, the Supreme Court of Canada in Bhasin v. Hrynew (“Bhasin”) established good faith contractual performance as a general organizing principle of the common law of contract and created a specific duty of honesty in contractual performance – ultimately, imposing a stand-alone duty of good faith. Despite Justice Cromwell’s repeated assertions that the judgement in Bhasin was an incremental step in the common law, Canadian legal scholars and prominent Canadian law firms dubbed it a “landmark” decision that would transform the manner in which business parties performed their contractual obligations.

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In distinguishing Iona, the Court of Queen’s Bench of Alberta confirms the sanctity of the Torrens registration system in determining priority interests even in the face of a statutory trust

Posted in Commercial, Construction, Land Use
Bryan WestAllyson Hopkins

In the recent decision of 1864684 Alberta Ltd. v 1693737 Alberta Inc., 2016 ABQB 371, the Court of Queen’s Bench of Alberta held that purchasers claiming a statutory trust pursuant to section 14(3) of the Condominium Property Act, RSA 2000 c C-22 (“Condo Act”) were subject to the same registration requirements, and priority regime, as other creditors under the Land Titles Act, RSA 2000 c L-4 (“Land Act”).

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Is a Developer Liable for A Buyer’s Losses from Changes in the Market? A BC Court Says No

Posted in Commercial, Litigation
Alexandra Cocks

Where there has been a misrepresentation by a developer in a real estate transaction, who is responsible for the losses suffered solely as a result of a change in market conditions? On September 15, 2016, in The Owners, Strata Plan LMS 3851 v. Homer Street Development Limited Partnership, 2016 BCCA 371, the BC Court of Appeal held that for a statutory misrepresentation under the Real Estate Act, a developer is not liable to compensate an investor for losses suffered as a result of external causes, such as changes in the market, which do not result from the inaccuracy of the representation. –> Read More

The Iona Decision (National) – Supreme Court of Canada dismissal bolsters priority of builders’ lien trust

Posted in Construction, Land Use
Aidan CameronBryan WestAllyson Hopkins

On April 14, 2016, the priority of statutory trust protections afforded to subcontractors and suppliers under Alberta’s lien legislation was strengthened: the Supreme Court of Canada dismissed an appeal in Iona Contractors Ltd. v. Guarantee Company of North America, 2015 ABCA 240, thereby bolstering the priority of the trust even in the face of a bankrupt general contractor. –> Read More

Vancouver to Enact Empty Home Tax

Posted in Policy, Residential
Jordanna CytrynbaumKate Macdonald

Late last week, the City of Vancouver announced details of its plans to tax vacant residential properties, which plans are part of its efforts to address the low rental vacancy rate and high cost of renting in the City. –> Read More

How long is the builders’ lien registration period for drilling and/or servicing a well or well site on an oil sands project? Spoiler Alert – it’s 90 Days!

Posted in Construction, Land Use, Litigation
Bryan West

In the recent decision of Davidson Well Drilling Limited (Re), 2016 ABQB 416 (“Davidson”) the Court of Queen’s Bench of Alberta held that the 90-day lien period to register a lien against an “oil or gas well” or “oil or gas well site” applies to drilling on oil sands mines. The Court also concluded that the costs of trucking equipment away from a project site after it is completed may, in certain circumstances, be properly included in a builders’ lien. –> Read More

Residential and Industrial Use – Never the Twain Shall Meet?

Posted in Land Use, Residential
Michael Nienhuis

I had the privilege (some would say misfortune) of growing up in a family business. I spent a lot of time after school and during summers in the shop and in spray booths, on crane trucks and on ladders, using all sorts of equipment and tools and generally taking in all the sights and sounds and smells (some noxious I’m sure) of a small sign manufacturing company.

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Does a Lease Created From an Option to Lease Enjoy the Same Priority as the Option?

Posted in Land Use
Julianne Gu

In large infrastructure projects where multiple parcels of land are required to build the project, project developers will often enter into options to lease with land owners rather than entering into leases in order to enjoy flexibility and to permit time to engage in suitability studies. The developers are frequently advised to register the option to lease on title so as to give notice of its right to the land.  However, the period between the registration of the option and the ultimate execution of the lease (if a developer decides to exercise the option) could last years, and it is not unusual for intervening encumbrances, including mortgages, to be registered on title during that time.   Assuming the option to lease was validly registered on title, developers are left with the question as to whether or not a lease resulting from the exercise of such option to lease would have priority over subsequent encumbrances by virtue of the priority of the option itself. –> Read More

Operating Cost Statements – How Much Information is Enough?

Posted in Commercial, Litigation
Bram Costin

Operating Costs – they are discussed endlessly during the lease negotiations and then often become the most contentious ongoing issue between landlord and tenant.

The almost universal practice is that at the beginning of each year landlord estimates operating costs and tenant pays in instalments based on that estimate.  Shortly after the end of the year the landlord delivers a statement of operating costs for the past year which may be certified or audited depending on the provisions of the lease. –> Read More

What does the duty of good faith REALLY mean?

Posted in Commercial, Policy
Danny McMullen

Since the Supreme Court decision in Bhasin v Hrynew[1], which firmly established a duty of good faith in contractual relations, the exact contours of that duty have been a fairly open question. In a recent Ontario Superior Court case, 2336574 Ontario Inc. v 1559586 Ontario Inc.[2], the court examined what that duty looks like in a one-off real estate transaction between sophisticated commercial parties. –> Read More