There are many sit­u­a­tions when Toronto real estate agents should rec­om­mend to their clients to have a sur­vey of the prop­erty com­pleted. A sur­vey allows clients to know exactly what they are buy­ing, includ­ing fence lines, ease­ments, encroach­ments, loca­tion of struc­tures and other visual mat­ters not cov­ered by title insurance.

Accord­ing to the Asso­ci­a­tion of Ontario Land Sur­vey­ors’ pam­phlet (http://​www​.aols​.org/) called What Real Estate Pro­fes­sion­als Should Know About the Role of the Pro­fes­sional Sur­veyor in the Real Estate Trans­ac­tion, “If there is any doubt or if there are any ques­tions about a sur­vey or the bound­aries of a par­cel, then a Pro­fes­sional Sur­veyor should be con­tacted to pro­tect the inter­ests of both the Real Estate Pro­fes­sional and the client.”

Real Prop­erty Report

A Surveyor’s Real Prop­erty Report (SRPR) is a legal doc­u­ment that clearly illus­trates the loca­tion of all vis­i­ble pub­lic and pri­vate improve­ments rel­a­tive to prop­erty bound­aries. It gen­er­ally takes the form of a plan or illus­tra­tion of the var­i­ous phys­i­cal fea­tures of the prop­erty along with a writ­ten report high­light­ing the surveyor’s opin­ion of any con­cerns. In a real estate trans­ac­tion, the SRPR can be relied upon by the pur­chaser, the seller, the lend­ing insti­tu­tion, the munic­i­pal­ity, the Toronto real estate agent and all other par­ties to the trans­ac­tion as an accu­rate rep­re­sen­ta­tion of the property.

Although Toronto real estate agents can offer guid­ance when it comes to sug­gest­ing prop­erty sur­veys, only a trained and licensed Ontario Land Sur­veyor can legally pre­pare an SRPR. An SRPR can help Toronto real estate agents to avoid poten­tial law­suits result­ing from mis­rep­re­sen­ta­tion in the offer to pur­chase related to prop­erty bound­aries and improve­ments. How­ever, as with all areas of real estate, never advise clients on mat­ters out­side of your area of exper­tise. If you are unsure whether a sur­vey is nec­es­sary, sug­gest your clients dis­cuss the mat­ter with their lawyer. The Law Soci­ety of Upper Canada advises Ontario lawyers that, “The lawyer should advise the client of the options avail­able to assure title in order to pro­tect the client’s inter­ests and min­i­mize the client’s risk.”

Accord­ing to the AOLS, the sur­vey report will include the following:

* a search of title of the sub­ject and abut­ting prop­er­ties,
* a search of all per­ti­nent encum­brances reg­is­tered against the title of the sub­ject prop­erty,
* a search of other surveyor’s offices to obtain all plans relat­ing to loca­tion of bound­aries of the sub­ject prop­erty,
* a field sur­vey to deter­mine the actual dimen­sions of the prop­erty, the loca­tion of improve­ments and the set­ting of cor­ner mark­ers,
* an analy­sis of research and field data,
* the prepa­ra­tion of the plan illus­trat­ing the results of the field sur­vey and the title research,
* the prepa­ra­tion of a writ­ten report pro­vid­ing the surveyor’s opin­ion about any con­tentious issues that may have been found dur­ing the survey.

Because of the amount of work and detail involved, sur­veys gen­er­ally cost sig­nif­i­cantly more than title insur­ance. How­ever, while it may some­times be mar­keted as a way for home buy­ers and sell­ers to save money, title insur­ance does not take the place of a sur­vey. “As noted in a pend­ing case, the usual title insur­ance pol­icy, although it pro­vides title pro­tec­tion, may not be a sub­sti­tute for a new surveyor’s real prop­erty report,” says real estate lawyer, Merv Burgard.

Also keep in mind that fail­ing to rec­om­mend a sur­vey could poten­tially land Toronto real estate agents in hot water. For exam­ple, in 2003, a Toronto real estate agent was found to have breached the RECO code of ethics by fail­ing to make a pur­chase agree­ment con­di­tional on review and approval of a sur­vey (www​.reco​.on​.ca). In this case, it was not explained to the buyer that the dri­ve­way on the prop­erty belonged to the Min­istry of Trans­porta­tion (MTO). “The sales­per­son failed to advise the buy­ers to seek out­side pro­fes­sional advice such as a lawyer or a sur­veyor.” RECO’s Dis­ci­pline Com­mit­tee found that the sales­per­son acted in an unpro­fes­sional man­ner by fail­ing to make the offer con­di­tional on the approval of a sur­vey and fail­ing to advise the buy­ers to have an expert review the sur­vey. An up-to-date sur­vey would have made it clear that the dri­ve­way did not come with the house.

Even title insur­ance providers agree that a sur­vey is nec­es­sary in some cases. In its Novem­ber 2006 mem­ber newslet­ter, Stew­art Title dis­cusses sit­u­a­tions where clients should be advised to obtain a sur­vey of the prop­erty, and to do build­ing and zon­ing searches even though the clients are obtain­ing title insur­ance. These sit­u­a­tions include where the client intends to alter the house by adding an addi­tion to the prop­erty or where the exact dimen­sions of the prop­erty, or the area of the prop­erty set out in the Agree­ment of Pur­chase and Sale is impor­tant to the purchaser.

Offer clauses

A sur­vey may be a con­di­tion of a pur­chase. In some cases, the sur­vey may be the finan­cial respon­si­bil­ity of the seller and in oth­ers the buyer may pick up the tab. In either case, be sure to allow ade­quate time in the offer and ensure the dead­line for the sur­vey is prior to the end of the req­ui­si­tion period. Another way to phrase it in the offer is “within ___ days after waiver of all con­di­tions (and prior to the end of req­ui­si­tion period).” As with all con­di­tions or clauses, ensure the word­ing is clear. For exam­ple, do not use the phrase, “up-to-date” as it is sub­ject to dif­fer­ent inter­pre­ta­tions by indi­vid­ual buy­ers, sell­ers and their respec­tive solic­i­tors. Depend­ing on the sit­u­a­tion, there are four stan­dard clauses that deal with sur­veys includ­ing Buyer Acknowl­edges Pos­si­ble Sur­vey Require­ment; Seller to Pro­vide Exist­ing Sur­vey with Dec­la­ra­tion; Seller to Pro­vide New Sur­vey and Sur­vey, Build­ing Plans, Mechan­i­cal Draw­ings, Warranties.

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Con­tact the Jef­frey Team for more infor­ma­tion

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