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Salt Spring Island Real Estate

MLS homes for sale by Scott Simmons

Unsubdivide-able land On Salt Spring

November 20, 2014 By Scott Simmons Leave a Comment

Last year there was a group of cabins for sale on the Salt Spring MLS.   Some of you might remember them.  I was just shocked when they were first listed.  I sent a letter to the managing broker of the company that had them listed and explained the land is in the ALR and that what they were doing was actually leasing the buildings without and interest in the land.  They changed their listing info and made it clear that the purchase did not include the land.   I was still skeptical and did not show the cabins.  What would preclude the land owner from evicting the cabin owners?  The lease they were selling was for 99 years but there was no leases that I knew about registered on title.  Today I feel like I was right and vindicated for my position on those cabins.

This was just sent to me from the BCREA (British Columbia Real Estate Association)

In 2001, Lakefront Ranch Inc. (Lakefront) owned 320 acres of land in central BC. The property was situated within the Agricultural Land Reserve (ALR) and therefore subject to the Agricultural Land Commission Act (ALC Act) which prohibited the subdivision of land within the ALR into smaller parcels except in extraordinary circumstances.

The shareholders of Lakefront were four separate companies, each of which held 25 per cent of the shares of Lakefront. One of those shareholder companies was Mushroom Farm Inc. (Mushroom). A single individual controlled each of the four shareholder companies, and through them Lakefront.

Lakefront and each of the four shareholder companies entered into a Shareholders Agreement and Declaration of Trust (Agreement) whereby Lakefront was said to hold the property “as trustee for the shareholders and their successors.” Pursuant to the Agreement, the property was informally divided into four parcels and each of the shareholders was given exclusive possession of one of those parcels.

The Agreement characterized the rights of the shareholders to those unsubdivided parcels as an interest in land. The Agreement also made it clear that the purpose of the scheme was to avoid the unsecure and costly process of subdivision which, at trial, all parties agreed was unlikely to have been approved given the restrictions of the ALC Act.

The shares of Mushroom were transferred to new owners but the single individual continued to retain control of the other three shareholder companies and thus control of Lakefront. Over time Mushroom and Lakefront had a disagreement over their respective rights and obligations under the Agreement and Mushroom eventually sued Lakefront for failing to comply with its obligations

In what can only be described as legal chutzpah, Lakefront successfully argued that it was not bound by the Agreement (which was drafted by Lakefront itself) because the Agreement was illegal in that it offended Section 73 of the Land Title Act (LTA). Section 73 prohibits the subdivision of land into smaller parcels except in accordance with the LTA, which all parties agreed was not followed.

In agreeing with Lakefront,1 the court followed a 1996 decision of the BC Court of Appeal2 which held that an attempt to grant rights of occupation to a portion of land without first subdividing that portion offended the policy objectives of Section 73. As a result, the court determined that the Agreement was unenforceable to the extent that it purported to convey an interest in land to Mushroom.

From time to time REALTORS®, acting either for buyers or sellers, may encounter schemes which purport to grant exclusive possession to unsubdivided portions of a larger parcel of land. Some schemes may be similar to the scheme described in the Mushroom Farm Inc. case, others may not. Some schemes may offend Section 73 and others may not.

The validity of each scheme will be determined by the specific facts and circumstances involved. When confronted with a scheme that purports to create rights of occupation to an unsubdivided portion of land, REALTORS® should proceed with great caution.

A REALTOR® representing a seller wishing to sell a right to occupy an unsubdivided portion of land (either through the sale of shares or otherwise) should:

A. ensure that the seller obtains legal advice with respect to the legality of the interest the seller wishes to sell in light of Section 73 and the Mushroom Farm Inc. decision, as well as the provisions of the Real Estate Development Marketing Act (REDMA) as they apply to the marketing of cooperative and shared interests in land;
B. ensure that any representations made by the REALTOR® are consistent with the advice provided in (a); and
C. recommend that any unrepresented buyers obtain legal advice with respect to the interest they are acquiring in light of Section 73 and the Mushroom Farm Inc. decision and REDMA.
A REALTOR® representing a prospective buyer of a right to occupy an unsubdivided portion of land should ensure that their client, before making an offer to purchase, obtains legal advice with respect to the legality and extent of the interest being offered for sale in light of Section 73 of the LTA, the Mushroom Farm Inc. decision and REDMA.

Brian Taylor
Bull Housser LLP

Revised July 2015

1. Mushroom Farm Inc. v. Trike Ranch Inc., 2013 BCSC 1294.
2. International Paper Industries Ltd. v. Top Line Industries Ltd., (1996) 135 DLR (4th) 423.

“Copyright British Columbia Real Estate Association. Reprinted with permission.” BCREA makes no guarantees as to the accuracy or completeness of this information.

I’m not always right but if something looks to good to be true it’s probably not true.

Cheers

Scott Simmons

Filed Under: Buy house on Salt Spring

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CRITICAL BUYING INFO

Two things buyers should know before they offer:

Price History

Total time on market

Forms for the new BC Real Estate rules
Disclosure-of-Representation-in-Trading-Services
Agreement-Regarding-Conflict-of-Interest-Between-Clients
Disclosure-of-Risks-to-Unrepresented-Parties
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Salt Spring Real Estate Market Report

If you are looking for Salt Spring Island Real Estate it would be well worth your time to check out my Salt Spring Market Report pages.

To help you search for a Salt Spring home for sale I have two systems you can use.  One is a map based mobile search system for tablets and/or phones. This system works really well if you are on Salt Spring, as it will automatically show you properties as you drive around the island.

The other system is a data base (Advanced MLS system or PCS) for laptops or desktops.

These two systems display information in real time, which allows you to view new listings within one second of them coming on the market. You will also find the “sold” prices of homes, as well as other useful information.

Radio Real Estate Shows

TV show Realty Reality on Salt Spring

So glad shooting for the new Real Estate TV show “Realty Reality” is over. It was a lot of work. It all looks so easy on TV but in reality it was not easy. I think they were waiting for the “moment” to happen. You know the big fall down the steps or fall of […]

Home inspection on Salt Spring Island

Home inspection on Salt Spring Island happened yesterday at a 42 year old log home. To accomplish the home inspections the buyer brought in a  Home Inspector, Geo-technical Engineer and a local Salt Spring contractor. Jeff the home inspector tells the story about the bag of Gold he found in an attic; gold story How […]

Salt Spring home face lift

My clients bought this dated salt spring home a month ago and are upgrading it.  The home was built in 1996 and is structurally 100% perfect.  It seams as if the original owner skimped on the finishing.   The main up grade Alex Denny (salt spring master carpenter) will be doing for the owners is re-finishing […]

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Packing Tips for Busy Home Sellers

Packing correctly can simplify the burden of the entire process for a household and potentially their moving company. By packing smart, using proper protocols, and paying attention to the details, things can be ready to go far before the movers arrive and ready to unload upon arrival. Here are some tips for busy home sellers […]

Salt Spring rental homes by the numbers

I get many people asking me about buying a rental home on Salt Spring and usually spend a lot of time answering all their questions.  So in this post, I hope to cover some of the factual information. Here are the typical questions and basic answers; What is the rental market like on Salt Spring?  […]

Salt Spring Housing Crisis explained

Is Salt Spring in the middle of a housing crisis?  It all depends on who you talk to and what one defines as a crisis. If you move to Salt Spring and have limited funds and are looking to rent a home at about $1000 per month your probably out of luck.  There are basically […]

Buying on Salt Spring Island

Salt Spring rental homes by the numbers

July 18, 2018 By Scott Simmons 2 Comments

I get many people asking me about buying a rental home on Salt Spring and usually spend a lot of time answering all their questions.  So in this post, I hope to cover some of the factual information. Here are the typical questions and basic answers; What is the rental market like on Salt Spring?  […]

Ban on Dual Agency BC

June 16, 2018 By Scott Simmons 2 Comments

On June 15th, 2018 the ban on dual agency just came into effect in BC. Here is a post I wrote about how the new rules will change the way I do business on Salt Spring New Rules for BC Real Estate As a continuation of the New Rules post, what happens if we are […]

New Rules for BC Real Estate

June 16, 2018 By Scott Simmons Leave a Comment

On the 15th of June 2018, the new rules governing BC real estate have come into effect. If you come to Salt Spring to look at homes and or land Scott will go over the form below and ask you if you would like agency representation and ask you to sign this Disclosure-of-Representation-in-Trading-Services as a represented part […]

Salt Spring Island Trust Land Use Zoning bylaw 355

February 17, 2018 By Scott Simmons Leave a Comment

On Salt Spring Island the Island Trust is responsible for our local zoning.  You can find our zoning info here at the Salt Spring Island Trust LUB 355. The bylaw has maps that cover every part of the island.  Believe it or not every few months or so I get an email from someone saying […]

Is an offer an sale?

January 26, 2018 By Scott Simmons Leave a Comment

This last month I had an accepted offer on a home and had a backup offer come in.  The backup offer was a very weak offer because the condition precedent (subject to clause) was so subjective.  It was subject to the buyer viewing and liking the lot.  Normally no one would take an offer like […]

More Posts from this Category

 

SALT SPRING NEWS

Salt Spring Housing Crisis explained

July 12, 2018 By Scott Simmons 2 Comments

Is Salt Spring in the middle of a housing crisis?  It all depends on who you talk to and what one defines as a crisis. If you move to Salt Spring and have limited funds and are looking to rent a home at about $1000 per month your probably out of luck.  There are basically […]

Candidate for Regional Director CREA

March 7, 2017 By Scott Simmons Leave a Comment

I’m running for the position of board member Regional Director for BC for the Canadian Real Estate Association (CREA).  Below is my official platform after edits suggested by CREA lawyers. My name is Scott Simmons. I’m a REALTOR® on Salt Spring Island BC. If you go to the REALTOR.ca site and put in Salt Spring […]

CRD sewer and solid waste

January 23, 2017 By Scott Simmons Leave a Comment

The nuts and bolts of local goverment are really the non glamours basics of water, sewer and garbage (solid waste).   The CRD is the local service provider for Salt Spring.  On the night of 24 Nov 2016 Russ Smith Senior Manager, Environmental Resource Management for the CRD put on a waste presentation.  Here is a […]

Incorporation – A Third Option: Self-governance with contracted services

May 11, 2016 By Scott Simmons Leave a Comment

This was just posted on the Salt Spring exchange in 4 parts.  I have permission from John Gauld the author to publish this document on my Salt Spring web site;   SSI is known as a community that questions conventional practices and is creative and innovative in its response to community challenges. Perhaps the up-coming […]

Salt Spring’s new SSIWPA PAC

November 4, 2014 By Scott Simmons 2 Comments

If you live on Salt Spring you have to get used to all the acronyms.  If you have not heard of SSIWPA it’s because it’s new.   SSIWPA stands for Salt Spring Island WaterShed Protection Authority.  Today  was the first meeting of the SSIWPA PAC (Public Advisory Committee). The ideal behind SSIWPA is that it […]

 

Critical Salt Spring Buying Info

Ban on Dual Agency BC

June 16, 2018 By Scott Simmons 2 Comments

On June 15th, 2018 the ban on dual agency just came into effect in BC. Here is a post I wrote about how the new rules will change the way I do business on Salt Spring New Rules for BC Real Estate As a continuation of the New Rules post, what happens if we are […]

New Rules for BC Real Estate

June 16, 2018 By Scott Simmons Leave a Comment

On the 15th of June 2018, the new rules governing BC real estate have come into effect. If you come to Salt Spring to look at homes and or land Scott will go over the form below and ask you if you would like agency representation and ask you to sign this Disclosure-of-Representation-in-Trading-Services as a represented part […]

Sun Path Chart

Does the home get sunlight?

February 28, 2013 By Scott Simmons 1 Comment

If you’re planning to live on Salt Spring year-round, one of the most important things to consider when buying a property is SUNLIGHT. Do the neighbor’s trees or a mountain block the sun during the winter months?  According to Salt Spring real estate mythology, “If they buy in August, they will list in November and […]

Aggregate Days on the Market

January 2, 2012 By Scott Simmons Leave a Comment

What are “aggregate days on the market”? On the Victoria Real Estate board an agent can “Re-List” a property for a mere $25 fee.  An example would be if a home has been listed on the board for 180 days the listing can be taken off the market and then “Re-Listed” and appear to be […]

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