Lot Mix Up – Survey is the Answer
Let me tell you about a very interesting situation.
Bob the Builder purchased 10 lots on a street. One half the street or lots 1 through 5 backed onto a ravine. He had several models, but the better houses went on the ravine lots.
Basically, all the lots had been sold and the new purchasers had all moved in. There were two lots leftover, 4 and 8.
Bill bought lot 4, backing onto the ravine. It was about 500 sf bigger than most of the other buildings and he purchased numerous extras and upgrades to the tune of about $50,000.00.
Now, we have a little problem. When the papers were being prepared, Bill’s documents reflected LOT 8, and not LOT 4.
In fact, there was another $50,000.00 for the ravine lot, so we are looking at a $100,000.00 differential between the two properties.
The error was sent over to the lawyers and the Deed was drawn up reflecting Lot 4.
No one noticed, the lawyer for the Vendor, the lawyer for the Purchaser or the lawyer for the mortgage company.
On closing, Bill received a Survey of the property, but it wasn’t just his property alone, it showed all 10 properties on the street. Bob saved a little money by doing it this way.
Bill received his papers from his lawyer and placed them in a filing cabinet for safekeeping, never to look at them again.
Then, he sold his property to Wilma. Naturally, Wilma thought she was buying Bill’s ravine lot with all the upgrades. On closing, she received a Deed to Lot 8, but she moved into Lot 4.
Wilma sold to Maureen and the same thing took place. Fast forward 20 years, that differential was now about $200,000.00.
Maureen goes to sell to Fred, but this time he meets the day ahead in his lawyer’s office. The lawyer pulls out the survey and points to Lot 8 as the one which Fred is to acquire. Fred says no, I am buying on the other side of the street backing onto the ravine.
Quickly, to the good news. The owner of Lot 4 lived in Lot 8 and agreed that everything was just a mistake and signed a conveyance to rectify the titles to both properties. Luckily, that was easy. Can you imagine the problems that could have developed?
It was the lawyer for Buyer #4 who caught the problem. The Builder’s lawyer and the lawyers acting for the next three purchasers all missed it.
Be sure to get a survey of the property you are about to acquire. Look at the survey and have your lawyer point it out on the survey plan if there is more than one property shown. Get a photocopy of the survey and have your lawyer highlight the location of your property in yellow marker so that there will be no mistake.
Are there any encroachments? If so, have them noted in red highlighter on a second photocopy.
The big problem here was that no one ever checked the 4 – 8 problem and several moves had taken place uneventually. People refer to their properties by municipal address, 123 Main Street, not Lot 4, Plan A. So, this was an easy error to have happen and an easy error to have perpetuated over time, in this case, over two decades.
Seek legal assistance and also have your real estate agent review this with you. As you can appreciate, this was a very easy error to spot “as long as someone was looking”.
Brian Madigan LL.B., Broker