What happens when lawyers forget to transfer title to parking units?
The situation is usually something like the following: Mr. Jones decides to buy a residential unit in a high-rise from the owner, Ms. Smith. The Agreement of Purchase and Sale indicates that Mr. Jones is purchasing the residential unit (Unit 10, Level 10) and a parking unit (Unit 80, Level A). The deal closes and Mr. Jones moves into his unit. He begins parking in his parking space and he pays the monthly common expenses and realty taxes for it. Years later, usually during a subsequent sale of the property, it is discovered that the lawyers acting for Mr. Jones and Ms. Smith did not transfer title to the parking unit to Mr. Jones; he only received title to the residential unit. Ms. Smith cannot be located to complete the transfer now. What is Mr. Jones to do? A case has recently been reported that has very similar facts. The purchaser and seller agreed to transfer both a residential unit and a parking unit in 1997. The title to the parking unit was not transferred at that time. In 2015, 18 years later, the owner decided to sell his unit. During his preparations for the sale he discovered that title to the parking unit was never transferred into his name. He brought an application to the court seeking a declaration that he was the legal owner of the parking unit and an order requiring the Land Registry Office to change title to the parking unit into his name. The judge reviewed the Land Titles Act, which abolished the right of adverse possession for land registered under it. The judge also reviewed the provisions of the Limitations Act, 2002, which has an ultimate limitation period of 15 years, and the Real Property Limitations Act, which defines various limitation periods for real estate matters.The judge concluded that a constructive trust existed between the parties that made the seller the trustee of the parking unit for the purchaser. Because of the constructive trust, the limitation period was calculated either from the date the owner discovered the error or from the date that he was dispossessed of his use of the parking unit, which had not occurred. The limitation period had not expired since the purchaser only recently discovered the error and he had not been dispossessed of the unit by the seller. Consequently, the judge ruled that the purchaser was entitled to legal title of the parking unit.