Chapter 3: Estates and Interests in Land

Question 1

Name the four kinds of estates in British Columbia.

Answer 1

1. fee simple estate
2. life estate
3. estate pur autre vie
4. leasehold estate

Question 2

Distinctions between real property and personal property?

Answer 2

Real property = the land and whatever is erected on that land, growing upon or affixed to the land, and whatever rights that come with it

Personal property = moveable objects

Question 3

Where does the law of real property in British Columbia derive from?
Can you elaborate how the real property law has evolved since 1858?

Answer 3

Based on the law of England.

The Law and Equity Act (1858) became the Law of BC but it have since been altered and modified by provincial or federal statutes according to the local circumstances.

As a result, our system now is quite different than the system in England, such as the land registration system “Torrens System”.

But what is the leftover from the English system is the land ownership that is all lands is owned by the Crown. So the definition “estate” comes from this system: a right to possess and use land for a period of time.

Question 4

How does the Crown practice its power with the doctrine of escheat?

Answer 4

If a fee simple owner has no heir, or dies without a will and there is no known heirs, the property will revert of “escheat” back to the Crown.

Question 5

What is a fee simple estate?

Answer 5

• the absolute owner
• has rights to the land for so long as he/she has heirs
• has the greatest bundle of rights
• “Fee” = could be transferred. “Simple” = no qualification for which heir could inherit / any blood relative

Question 6

What is a life estate?

Answer 6

A life estate is an estate in land that lasts for the lifetime of the holder - who is called the life tenant.

• A freehold estate (like fee simple estate)
• Entitled to use, possess, collect revenues
• But for an uncertain period of time (until your death…)

Question 7

Who is a “reversioner”?

Answer 7

Party A who creates a life estates in favour of B and upon the death of party B, the property will revert back to A.

A fee simple owner and is entitled to the property for as long as he/she has heirs.

Question 8

Who is a “remainderman”?

Answer 8

A can create a life estate in favor of B with the remainder of A’s fee simple interest going to C. C holds fee simple subject to B’s life estate. A gives up the rights on the property and C would appear on the land title certificate as the fee simple owner wth B’s life estate as a charge.

C is the “remainderman”.

Question 9

What is estate pur autre vie?

Answer 9

An estate that is based on ANOTHER PERSON’s LIFE.

So if A makes B the life tenant, B disposes of the life estate to D, D will be obtaining an estate pur autre vie. If B dies, the property will go to C the remainderman. D will have no rights and be forced to vacate.

Question 10

Does the life tenant responsible for the principal amount owing if the property is encumbered by a mortgage?

Answer 10

No. Life Tenant is only responsible for the payment of interest. He is also responsible for electricity, heat, water and taxes. Liable for waste too.

Question 11

What is the doctrine of waste? Among the four wastes, which 3 are recognized by the common law?

Answer 11

The doctrine of waste places certain limitations on a life tenant’s ability to change or damage a property.

Common law recognized these three wastes:

1. Voluntary waste (an action that change the property and the life tenant is liable to the reversioner / remainderman for this act - like demolishing a garage)
2. Permissive waste (allowing a property to deteriorate but has no obligation to repair it - like a bad rooftop)
3. Ameliorating Waste - a positive change (like building a deck)

A fourth waste was crated by the courts of equity:
Equitable waste - a malicious act, like burning down the house.

Question 12

What should the licensee do if you encounter a life estate? What would be your concerns? Name two.

Answer 12

1. Do not list the property until you have an agreement from life tenant and the “remainderman” or “reversioner” that they both agree to sell the property. And all parties should be included in the listing.
2. It will be hard to get a mortgage on such an estate because bank will freak out on these uncertain terms, such as that the estate will just ‘poof - disappear when someone dies, or the person dies. Even if a loan is successfully given, they would require that the borrower has a life insurance on the life tenant, equal to the value of the loan.

Question 13

What is a leasehold estate?

Answer 13

*binding successors to the title but inferior to freehold estates (fee simple, life estate)

Question 14

What is the doctrine of privity under the Law of Contract? Does this apply to the contract for land interest?

Answer 14

Only the parties to the contract can enforce the rights and obligations under it.

No. This does not apply to the contract of land interest. The interests in land “run with the land”. In BC this is only recognized if the land is registered under Land Title Act.

Question 15

Do you possess a land if you own easement?

What other two interests are in the same category as an easement?

Answer 15

No. You don’t possess a land if you own an easemennt.

Similar to owning restrictive covenants, or profits a prendre.

Question 16

What concern the licensee if you see interests in land in a property you want to list?

Answer 16

If you see an easement, restrictive covenant or profits a prendre, you should know that this will affect the market value of the property and will affect mortgage qualification.

Question 17

What is an easement?

Answer 17

A right to use a NEIGHBORING property in a specific way (without possessing it) for the benefit of the holder’s land. Dominant tenement enjoys the benefit, servient tenement bears the burden of an easement.

• An easement must have subjects (dominant + tenement)
• Easement must accommodate the dominant tenement (and not the land owner only) - it must make the dominant tenement land more valuable in some way
• Must be capable of forming the subject matter of grant ( be specific about the area of easement).

Question 18

What is the “statutory rights of way”?

Answer 18

The Land Title Act allows the Crown, municipalities to create easement without dominant tenement. BC Hydro and Power Authority usually use this power to acquire rights of way.

Question 19

What would the licensee be concerned about the easements applied to a property?

Answer 19

1. review the easement to understand the extend of the rights (foot passage, foot and vehicle, parking , construction of structures, etc)
2. provide a copy of the easement to the buyer
3. encourage the potential buyer to seek legal advice

Question 20

What is a restrictive covenant?

Answer 20

a covenant restricting the use of the land of the covenantor (the servient tenement) for the benefit of land belonging to the convenantee (the dominant tenement).

Example; height restriction

Requirements that must be fulfilled before a court approve a restrictive covenant:

1. it must be negative in nature
2. it must benefit or enhance covenantee
3. covenantors and covenantee must be clearly identified
4. bind the land, not the land owners
5. if the land has been transferred, the new owner must agree to the agreement before acquiring it

Question 21

Can the restrictive covenant be released?

Answer 21

Yes, with the agreement between present owners or by court order

Question 22

What is a building scheme?

Answer 22

Refers to a set of restrictive covenants imposed on two or more lots within a particular subdivision.

keywords

• a scheme of development
• imposes restriction on land
• two or more parcels sold to different buyers / leased to different tenants
• each enters a different set of restrictive covenants and agree with it - if agree with it, the scheme will then run with the land, passing to the successors. Once the declaration is registered , it will RUN WITH THE LAND.

Usually by a developer who is selling lots of residential subdivision and wants to maintain uniformity of the lots to protect their values.

Question 23

What can the building scheme restrict?

Answer 23

Size, type, style, color, number of buildings on land

Question 24

What are the three requirements to register a building scheme?

Answer 24

1. must be negative in nature
2. which land benefits and which land is burdened - it must be clearly defined
3. the title of land (of the affected covenant) must be registered under Land Title Act

Question 25

What should the licensee do if you find out that the property has building scheme restrictions?

Answer 25

Ensure that the buyer receives a copy of the building scheme restrictions and acknowledges having read and approved the document.

Question 26

What is profit a prendre?

Answer 26

A right to enter on to the land of another person and to take profit from the land (mineral, oil, stones, fish, etc) for the use of the owner of rights.

Cannot be implied by law like in easement.

Question 27

What if a person is not happy with certain interests in land? Where can one apply to cancel or modify?

Answer 27

BC Supreme Court.

Question 28

Will the life tenant, remainderman and reversioner appear on the Land Title certificate?

Answer 28

Yes. All of them will.

The life tenant will be registered on the title to the property. The remainder man/reversioner will also be registered as being entitled to the remainder after the life estate end.

Question 29

Can a life tenant (B) sells the estate?

Answer 29

Yes.

It is possible for B can sell the property. However, B will only be able to sell a life estate since that is the interest B is entitled to by law. B cannot sell an interest greater than what they have.

Question 30

Who can grant a profit a prendre?

Answer 30

Private landowner or the government.

A profit a prendre is similar to a license where the holder of a profit a prendre has the right to take a certain resource from a defined parcel of land. A profit a prendre may be granted either by the government or a private landowner. This depends on who owns the land on which the holder of the profit a prendre may take the certain resource. For example, a landowner may grant a profit a prendre to a forestry company which gives that company the right to remove trees from a part of the land.

Question 31

What is chattels? What is fixture?

Answer 31

Fixtures = things that are affixed, comes with the house = TO IMPROVE THE LAND (such as outdoor oven / tool shed) 
Chattels = things that are not affixed = FOR THE BETTER USE OF THE ITEM ITSELF (such as pictures)

Question 32

What is “FSR”?

Answer 32

Floor space ratio.

Under zoning bylaws, a person is limited to how many square metres of building can be built per square metre of land.

Question 33

Name 2 things you know about airspace rights.

Answer 33

Airspace right = legal concept that a person owns a land also owns as much as airspace above the land as he/she can effectively use.

A separate legal parcel within a strata lot will need to be filed for airspace.

Airspace parcels have also been used to create legal parcel for parking.

Most commonly used airspace parcels are in condominium buildings, with airspace parcels carved out to separate residential and commercial area within buildings.

Question 34

What are the purposes of Water Sustainability Act?

Answer 34

manage use of the water - to address climate change, population growth, increasing pressure on water resources to ensure a sustainable supply of water meets the residents of British Columbia.

The greatest requirement change in this act - groundwater users need to have a water license.

BUT you can use the ground water (well ) for domestic purposes (feed horses, do gardening, water the lawn, etc)

Question 35

What will the water license show?

Answer 35

• max. amount of water can be used per year
• purpose of usage
• the time of the year when the water can be used (summer, winter, etc)

Extra info:
while water licenses are not shown on the Land Title Office, they can be found on BC Water Rights Database ( can be searched online)

Question 36

What might happen if a licensee fails to include fixtures / chattels in the purchase and sales contract?

Answer 36

Might receive a letter demanding compensation, sometimes by way of commission reduction.

Question 37

What is an “easement in gross”?

Answer 37

An “easement in gross” can effectively be thought of as a license. It occurs where one party (A) has the right to enter/use a portion of another party’s (B) land, but where A does not have property which benefits from the use of B’s land.

An example would be a billboard. Party A might acquire the right to use a portion of Party B’s land to install a billboard on that land. However, if Party A does not have nearby land which benefits from that billboard (and instead the benefit Party A acquires is advertising), there is no dominant tenement. Therefore, the right to use B’s land would not be a valid easement, it could be said to be an easement in gross.

Question 38

What does “without impeachment for waste” if one person creates the life tenancy express that?

Answer 38

Life tenant is liable for three types of common law waste (ameliorating, voluntary, permissive) but NOT equitable waste (destroy the property).

Question 39

Indian Reserves Vs. Treaty Settlement Land Vs. Aboriginal Title

Answer 39

Indian Reserves - allotment, owned by federal, cannot be subdivided

Treaty Settlement Land - Nisga, Tsawwassen 1st Nation, Maan-nuth 1st Nation, Tlamin. Fee simple. Extensive governance authority over the treaty lands

Aboriginal title - given by supreme court of Canada or contractual agreement between the Crown and the aboriginal group. Inheritent collective land right. Once established, gov or others cannon use of develop the title land unless they have permission of the Aboriginal title holders. 1st nations have the full freedom to decide the land use.