Real Estate Transactions Involving Powers of Attorney
In order to attempt to combat what is felt to be a growing problem of real estate fraud, the Ontario government has put new registration requirements in place when a real estate document is being registered.
The requirements call for the making of certain “law statements” by an individual registering a real estate document (transfer or mortgage) under the authority of a power of attorney. The individual must make a statement that they are acting within the scope of the power of attorney. Further, the solicitor must discuss the power of attorney with the client and make a “law statement”. For most purposes, the solicitor must complete the following statement:
I, name of solicitor, confirm that I have reviewed the power of attorney with the attorney, and the attorney has confirmed that:
1. The attorney is the lawful party named in the power of attorney,
2. The attorney is acting within the scope of the authority granted under the power of attorney,
3. To the best of the attorney’s knowledge, information and belief, the power of attorney was lawfully given, and
4. The power of attorney has not been revoked.
In addition, the original signed and witnessed power of attorney must be scanned and registered.
Lawyer and bencher Robert Aaron discussed the new requirements in a recent article in the Law Times, p. 12. Mr. Aaron stated that while the new requirements will allow the party on the other side of the transaction (and their solicitor) to review the power of attorney document, and provides an opportunity for defective powers of attorney to be caught, “I’m not sure that it will frankly do much to stop fraudulent powers of attorney.”
Thank you for reading.