What a Buyer's Lawyer Does in a Newfoundland and Labrador Home Purchase

Once your offer is accepted, a lot happens quietly in the background before you get your keys. Much of it falls to your lawyer: checking the title, preparing the documents, dealing with your lender and registering your ownership.

This article explains the main steps in a Newfoundland and Labrador purchase, why registration matters, and what is still your job. The details depend on your offer and your lender, so use this as a map rather than a checklist set in stone.

This article covers the law of Newfoundland and Labrador.

Why lawyers handle the paperwork

Drawing, preparing, revising or settling a document relating to property that must be registered in a public office is part of the practice of law under the Law Society Act, 1999. That covers deeds and mortgages for registration. A person who is not a member in good standing of the Law Society generally may not practise law, subject to listed exceptions.

One exception is for real estate agents, who may prepare and deliver formal agreements of sale they negotiated. An individual may act on their own behalf in a proceeding to which they are a party, but that exception is framed around proceedings and does not clearly cover preparing your own registrable deed or mortgage. No statute reviewed says a buyer must hire a lawyer, but the Registry of Deeds itself calls it advisable.

Searching the title

The Registry of Deeds is open to the public, and registered documents may show property descriptions, liens against property and the consideration paid. Registry staff do not do searches for clients, and title searching in the province is complicated, so a professional search firm or lawyer is recommended.

The registry gives notice and priority; it does not guarantee title. A search may also show only a notice of mortgage rather than its full terms. Your lawyer reviews what the search turns up and raises problems with you before closing. In a sale for valuable consideration, the seller is treated as covenanting that they have full power to convey as beneficial owner and that the property is free of encumbrances except those expressly accepted.

Mortgage documents, adjustments and closing

If you are borrowing, your lawyer typically deals with the lender's instructions, reviews the mortgage terms with you, and arranges for the mortgage to be signed and registered. Your lawyer also prepares a statement of adjustments, which divides costs such as property taxes between you and the seller as of the closing date. The details depend on your agreement and your lender.

On closing, the money moves, documents are exchanged and the deed and any mortgage are sent for registration. Registration charges are paid at the time of registration. A registrar may not register an instrument unless the proper fee is first paid.

Why registration matters

An instrument that has not been proved and registered is judged fraudulent and void at law and in equity against a later purchaser or mortgagee for value who registers first. Registration also constitutes notice to anyone later claiming an interest in the land. An instrument is considered registered when delivered if the registrar finds it compliant, which fixes the time of registration and priority.

Paper documents must be originally signed and witnessed by a person authorized to administer an oath, or accompanied by an affidavit of execution. They must also include a registration application form, or they are returned unprocessed, and carry an accurate written property description. The registrar can refuse an instrument for reasons such as a missing legible property description. A refusal is appealed to the Supreme Court within 30 days.

What you still need to do

• Give your lawyer your offer, any conditions and your lender's contact details as soon as the offer is accepted.
• Provide identification and sign documents when asked.
• Arrange the funds for your down payment and closing costs, including registration charges.
• Arrange home insurance, which lenders commonly require before closing.
• Review the statement of adjustments and ask about anything unclear.
• Do a final walk-through of the home before closing if you can.

Newfoundland and Labrador has no land transfer tax, but the land registration charge applies. On a $300,000 purchase the deed registration charge works out to $1,298. Ask your lawyer for a full estimate of closing costs early.

Frequently asked questions