INSIDE: Mortgages
Transcription
INSIDE: Mortgages
Fall 2013 Volume 22 • Number 3 Published Quarterly by The Society of Notaries Public of British Columbia Samantha Gale CEO, Mortgage Brokers Association of British Columbia INSIDE: Mortgages Publications Mail Agreement: 40010827 TABLE OF CONTENTS Efficient. Accurate. Smart. Introducing Stewart Assyst Real Estate, the electronic mortgage processing application that enables Canadian legal professionals to exchange instructing, reporting and mortgage data with top Canadian lenders. Designed for your office Stewart Assyst features a streamlined process which allows your office to manage mortgage transactions in a secure and seamless manner, providing valuable time savings and improved data accuracy. For more information on how Stewart Assyst can help your practice or to arrange a setup, contact Stewart Title today. (888) 667-5151 www.stewart.ca/StewartAssyst Keeping real estate transactions where they belong – in your office. ©2013 Stewart. Trademarks are the property of their respective owners. NTL 09/13 You’re unique. Your mortgage strategy should be too. As your financial picture changes over time, the right mortgage strategy can help you meet your needs and reach your goals. If you’ve been thinking about consolidating highinterest debts, renovating your home, or perhaps purchasing a rental or vacation property, now’s the perfect time for a mortgage check up. As a professional mortgage broker, I’m committed to providing you with the best mortgage strategy for your unique financial situation – now and into the future. Let’s talk. Paula Siemens Senior Mortgage Broker phone 604 604351 351-7438 phone 7438 email [email protected] [email protected] email www.siemensgroup.ca web www.siemensgroup.ca www.invis.ca Invis-The Siemens Group — 902-777 West Broadway, Vancouver, BC, V5Z 4J7 www.wildmanphotography.com P u b l i s h e d b y T h e S o c i e t y o f N o t a r i e s P u b l i c o f BC FEATURES: MORTGAGES THE CEO/SECRETARY OF THE SOCIETY Cy-près, Cassano, and the ACLF 6 Wayne Braid COVER STORY The Evolution of Mortgage Brokering in BC 17 THE PRESIDENT OF THE SOCIETY The Origin of “The Mortgage” John Eastwood KEYNOTE Mortgage Musings Val Wilson To go directly to an article, please CLICK on its title or page number. 7 2013 Fall Conference and AGM 8 Marny Morin Honourary Life Membership Office of the Superintendent of Financial Institutions (OSFI) 10 The Mortgage Process 101 12 Kevin Lutz 36 George Tanco 36 The Board of Directors of The Society of Notaries Public of BC 2013–2014 37 The 2013 Members of The Society’s 25-Year Club 37 New CMHC Tools for Homebuyers 15 Thank you, BC Notaries and Do Process! 37 Mortgage Insurance Considerations 16 BC Notaries, Their Guests, and Our Conference Sponsors 38 Thank You! 38 Ian Callaway B-20 Guideline OSFI Residential Mortgage Underwriting Practices and Procedures18 The Mortgage Industry in BC (Chart) 19 A Day in the Life of a Mortgage Broker 20 BC Notaries’ Education MA ALS 603, Philosophy of Law: Examining and Applying Legal Thought Todd McKendrick BC Notaries’ Education The Joy of Learning Rob Regan-Pollock Regulating Mortgage Brokers in British Columbia 22 The Residential Appraisal Process and Mortgages 24 Janice P. O’Brien The Role of a Professional Survey in the Mortgage Process Chuck Salmon Dream Home or Nightmare? 43 Cam Sherk The Examiners for BC Notary Students D. Peter Ramsay, QC Meet the Board of Directors 27 28 42 44 Travelling Mann: Lorne Mann in Creston 46 BC Notaries Speak Your Language 58 Services a BC Notary Can Provide 75 John Leech Inspections Should Tell All 29 Mortgage Refinancing through Your BC Notary 30 Daniel Boisvert Mortgage Enforcement in British Columbia 31 Andrew Bury Schedule “A” 32 Mortgage FRAUD Exposed! 33 Ron Usher 4 Building Better Communities, One Grant at a Time The Board of Governors 49 Spotlight on Good Works BC Notary Foundation and BC Coalition of People with Disabilities Jane Dyson The Society of Notaries Public of British Columbia 50 Volume 22 Number 3 Fall 2013 The MiX LAND When Space is Limited, Think Bigger 52 Nigel Atkin ORIGINAL RECIPES Healthy Meal Tips from Brazilian Cuisine 56 The George Whyte Award 58 Published by The Society of Notaries Public of British Columbia Business to Business 59 Editor-in-Chief Val Wilson Legal Editors Wayne Braid, Ken Sherk Magazine Committee Filip de Sagher, Chair Kate Manvell Zoë Stevens Marny Morin, Staff Liaison Lisa Shaskin Administration Amber Rooke Editor’s61 Courier Lightspeed Courier & Logistics Marco Castro TRIBUTE REIBC Board of Governors 2013–2014 60 ABCLS Our Newest Surveyors 60 BUSINESS Square with Your Clients 61 MAKING A DIFFERENCE October is Community Inclusion Month. Community Inclusion is for Everyone 62 Cathy Grant GIVING BACK The Birth Lottery: My Days in Haiti and the Lessons Learned 64 The Scrivener Telephone: 604 985-9250 email: [email protected] Website: www.notaries.bc.ca/scrivener Setareh Khasha LETTERS 68 THE MATURE MARKET Ageless Tips for Effective Communicating 69 Rhonda Latreille COPYRIGHT AND ONLINE IMAGES Beware Using Other People’s Pictures! 70 Jennifer Dove WILLS & ESTATES Sibling Rivalry: Mom Always Loved You Best 72 Trevor Todd, Judith Milliken, QC TAXES It’s in Your Interest to Make it Tax Deductible 74 Andrea Agnoloni TECHNOLOGY Fall Tech Trio The Society of Notaries Public of BC 604 681-4516 To send photographs to The Scrivener, please see the Editor's column on page 61. All rights reserved. Contents may not be reprinted or reproduced without written permission from the publisher. This journal is a forum for discussion, not a medium of official pronouncement. The Society does not, in any sense, endorse or accept responsibility for opinions expressed by contributors. 76 Akash Sablok Honours & Events PEOPLE78 Where in the World Has The Scrivener Been? 78 The Scrivener: What’s in a Name? “A professional penman, a copyist, a scribe . . . a Notary.” Thus the Oxford English Dictionary describes a Scrivener, the craftsman charged with ensuring that the written affairs of others flow smoothly, seamlessly, and accurately. Where a Scrivener must record the files accurately, it’s the Notary whose Seal is bond. We chose The Scrivener as the name of our magazine to celebrate the Notary’s role in drafting, communicating, authenticating, and getting the facts straight. We strive to publish articles about points of law and the Notary profession for the education and enjoyment of our members, our allied professionals in business, and the public. Volume 22 Number 3 Fall 2013 The Scrivener Canada post: Publications mail agreement No. 40010827 Postage Paid at Vancouver, BC Return undeliverable Canadian Addresses to circulation dept.: The society of notaries public of bc Suite 1220 – 625 Howe Street Box 44 Vancouver, BC V6C 2T6 [email protected] TABLE OF CONTENTS 5 THE CEO/Secretary Of THE SOCIETY Wayne Braid ACLF AFDC ASSOCIATION DES FONDATIONS DE DROIT CANADIENNES www.wildmanphotography.com ASSOCIATION OF CANADIAN LAW FOUNDATIONS Cy-près, Cassano, and the ACLF B C Notaries are quite unique in North America regarding the services they provide to the public. Notaries in most Provinces and States in the USA do not practise in the noncontentious areas of law that we do here in British Columbia. The result is that our involvement with counterparts on the continent is somewhat limited. On occasion, we do get involved in some very exciting and meaningful programs and discussions. One such program came to us through our Notary Foundation of BC. As a result of a court decision in Ontario, the Law Foundation of Ontario (LFO) was entrusted with a $14.6 million cy-près award, known as the “Cassano” decision. The Court ordered that the LFO disperse the funds using a geographic model. Because the case involved citizens from all the provinces, the judge wanted the funds distributed Canada-wide. The Law Foundation of Ontario established an Access to Justice Fund with the funds and asked the Association of Canadian Law Foundations (ACLF) to assist with the distribution of the funds through a program to identify organizations in each province that would make the best use of the award. The Notary Foundation of BC is a member of the Association of Canadian Law Foundations. We meet once a year to discuss issues of mutual interest and concern. 6 TABLE OF CONTENTS …we do get involved in some very exciting and meaningful programs… The Access to Justice Fund was launched May 31, 2010. The response exceeded expectations; more than 210 letters of intent were received from across the country. An application form was developed and circulated through the various provincial Law Foundations. Because of the overwhelming response, the fund was closed to submissions on February 28, 2011. As of July 2013, 89 grants for a total of $13,762,628 have been made. Here are some of the British Columbia organizations that received financial support for various projects. •British Columbia Coalition of People with Disabilities •Courthouse Libraries of BC •People’s Law School, who received funding to perform hour-long plays exploring legal issues of relevance to students •Ending Violence Association of BC, who received funds for a project that works in partnership with Legal Services Society of BC to train Aboriginal service providers about criminal justice, family justice, and child-protection laws •The Justice Education Society, who received funding for a program to develop an online self-help tool to self-represented litigants appearing on family and civil law matters before the BC Supreme Court The Society of Notaries Public of British Columbia •The group MOSAIC, who conducted a program that provides legal advice to survivors of domestic violence. They conducted a series of workshops on issues pertaining to domestic violence for providers and survivors. Fourteen national projects were provided with grants. A national project is identified as a project that will involve more than one Province or Territory. Over one third of the projects funded had an Aboriginal theme and provided many provincial Aboriginal organizations to use and expand their expertise to deliver projects across jurisdictions. All provinces received some funding except PEI. They currently have a project being considered, however, as does Nunavut. Wayne Robertson, Executive Director of the Law Foundation of BC and a member of the committee who reviewed the Grant applications and letters of intent, kept the Notary Foundation of BC involved in the discussions of how to use the funds. Wayne reported to our Foundation Board on a number of occasions as the projects were being considered. The fund will continue to be managed by the Law Foundation of Ontario. All the Foundations across Canada should be acknowledged for their fine work. Many people who do not or may not have access to justice tools and services were provided with assistance in a very meaningful way. s Volume 22 Number 3 Fall 2013 THE PRESIDENT Of THE SOCIETY John Eastwood B ack in history, as early as 1190 in England, a mortgage was a conveyance of land for a fee. The buyer agreed to pay the seller a fixed price for the land, with no interest, and the seller would sign over the land to the buyer. The conditions that had to be met before the land would be the property of the buyer were usually based upon the assumption that the land would produce sufficient income to pay back the seller. A mortgage was drawn up and stayed in effect, whether the land produced or not. That type of mortgage gave the seller of the property—or the lender holding the deed to the land— absolute power over it to do whatever they wished, including selling it, not allowing payment, refusing payoff, or creating other problems for the buyer, who had no rights to require them to convey title. With time, and continued abuse of the mortgage system, the courts stepped in to enforce buyer’s rights; buyers acquired legally enforceable rights to absolute ownership of the land and buyers were able to demand the deed be free and clear upon the payoff of the property. At the same time, steps were taken to ensure the seller still had rights to secure the debt, to protect his or her interest, and make sure the money due was paid. Volume 22 Number 3 Fall 2013 •In England and Wales, the Law of Property Act of 1925 created mortgages. •In the USA, in 1934, the Federal Housing Administration Act (FHA) was created to insure mortgage lenders against default. Although mortgages have evolved into many different forms, they are still basically the same essential charge against land that they were in 1190. Mortgages began to be widely used. The FHA helped lower the downpayments on homes and made it easier for buyers to finance a home purchase. After the introduction of the FHA, approximately 40 percent of people in the United Sates owned homes. Today that number is closer to 70 percent, due in part to the current low interest rates. The Government of Canada in 1934 introduced the National Housing Act (NHA), which provided default-insured residential mortgages. They were initially funded mainly by life insurance companies until the introduction of the Bank Act in 1954, which allowed banks to provide residential mortgages at a rate of up to 6 percent. In 1967, that 6 percent cap was removed. The Scrivener www.TheBigPictureStudio.com The Origin of “The Mortgage” Since then, mortgage interest rates have fluctuated greatly, increasing to approximately 8 percent in 1968 and climbing during the 1970s to 9 and 10 percent, ending the decade at 14 percent. In 1980 and 1981, the housing boom lead to rapidly increasing rates that peaked at 21 percent, resulting in a recession in the real estate marketplace. Today, Canada Mortgage and Housing Corporation (CMHC), together with a few private insurers, provides mortgage lenders with default insurance, with repayment amortized up to 35 years. Recently, concern over the rapidly increasing homebuyer debt load and the potential for mortgage rate increases prompted the Canadian Government, through CMHC, to increase the downpayment requirement and reduce the amortization period. Although mortgages have evolved into many different forms, they are still basically the same essential charge against land that they were in 1190. Many laws and regulations help protect the buyer, seller, and lender. There are a variety of mortgage rate plans with historically low interest rates. Mortgage lending has become very competitive. In addition to the traditional mortgage through life insurance companies and banks, other lenders offer mortgage funds with very competitive rates and terms, directly and through mortgage brokers. s TABLE OF CONTENTS 7 KEYNOTE Val Wilson • Trademark Prosecution, Registration, Opposition, and Expungement Proceedings • Trade Name and Trademark Searches • Corporate Name Reservations 1081 Cambie Street Vancouver, BC V6B 5L7 [email protected] Phone: 604 687-7432 Fax: 604 687-3478 [email protected] Specializing in Trademarks since 1983 8 TABLE OF CONTENTS Each quarter, the articles in the front section of The Scrivener focus on a specific theme. Our Summer theme was Stratas. (Back issues are archived via www.notaries.bc.ca.) T he Fall theme is Mortgages. My first notion of “mortgage” came from classmates who lived in a pleasant subdivision known as the VLA. I learned that the buyers of those homes received help from the federal government because of their military service. The assistance came in the form of a government loan. VLA stood for Veterans Land Act. Says our regular contributor Nigel Atkin, “There are many perspectives to the concept of mortgages. The variables of income, market value, interest rates, and other factors all come into direct play in obtaining a mortgage. The most obvious and personal one is how much will a financial institution think I am capable of paying for such and such a property.” My first application for a mortgage was rejected by my longterm financial institution because I had recently chosen a promising new career path; the bank did not consider me a good risk. The banker who delivered the news said, with obvious enthusiasm, “Now you don’t have to go through with buying that property!” She did not share my vision for the future. Fortunately, another bank felt that I qualified for the mortgage. The Society of Notaries Public of British Columbia www.wildmanphotography.com Mortgage Musings The articles in this issue range from simple “starter” information to the history of mortgages and in-depth looks at the way the profession and its processes work today at various levels. BC Notaries regularly do business with people we call Allied Professionals—land surveyors, lawyers, real estate professionals, appraisers, accountants, financial institutions, mortgage brokers, house inspectors, insurance professionals, and so on. Many of them have written about mortgages in this issue, from their respective points of view. Our topics include Refinancing by BC Notary Daniel Boisvert, Foreclosures by Andrew Bury, and a fine piece about Mortgage Fraud by Ron Usher. BC Notaries regularly do business with people we call Allied Professionals… In September, the federal Finance Minister, the Hon. Jim Flaherty, said that tightening the mortgage insurance market is a way of controlling prices and that there is a need Hon. Jim Flaherty for caution. On Monday, September 23, 2013, he said, “House prices are relatively stable in Canada, and I’m comfortable with where we are right now. The government doesn’t anticipate taking any further steps in terms of tightening the market for the time being.” That is very good news! s Volume 22 Number 3 Fall 2013 UBC Real Estate Division Professional Development Courses www.realestate.ubc.ca Today’s successful real estate professional is creative, analytical, adaptable, and committed to lifelong learning. The Real Estate Division at UBC’s Sauder School of Business offers a series of short online professional development courses aimed at real estate practitioners’ continuing education needs. All UBC Real Estate Division continuing professional development (CPD) courses are offered through distance education in self-study format or as a live online webinar. Completion of a CPD course will earn you a UBC award of completion. To find out how these courses can also earn you continuing professional development credits, visit www.realestate.ubc.ca/cpd. Topics offered include: • • • • • • • • Valuing Green Properties: Residential and Commercial Financial Reporting: Real Property Appraisal and IFRS Requests for Proposals (RFPs) – Winning Strategies Exposure & Marketing Time: Valuation Impacts Adjustment Support in the Direct Comparison Approach Residential Appraisal Basics / Commercial Appraisal Basics Valuation of Property Impairments and Contamination Speciality Valuation: Agricultural, Multi-Family, Business Enterprise, Submerged Land, Hotel, Office, Seniors Facilities, Machinery and Equipment Valuation To find out more, visit www.realestate.ubc.ca/cpd Contact Us Toll-free: 1.877.775.7733 Fax: 604.822.1900 Email: [email protected] Web: www.realestate.ubc.ca THE UNIVERSITY OF BRITISH COLUMBIA • • • • • • • Creative Critical Thinking Decision Analysis Highest and Best Use Analysis Appraisal Review Lease Analysis Urban Infrastructure Expropriation Valuation FEATURE: MORTGAGES Office of the Superintendent of Financial Institutions (OSFI) History OSFI was established on July 2, 1987, by the Office of the Superintendent of Financial Institutions Act (OSFI Act). This legislation created a single regulatory agency responsible for the regulation and supervision of all federally chartered, licensed, or registered banks, insurance companies, trust and loan companies, cooperative credit associations, and fraternal benefit societies. Since its creation, OSFI has seen significant changes in the institutions it supervises, the global context in which it operates, and the regulatory environment. Mandate OSFI was created to contribute to public confidence in the Canadian financial system. Under OSFI’s legislation, its mandate is to accomplish the following. •Supervise federally regulated financial institutions and pension plans to determine whether they are in sound financial condition and meeting minimum plan funding requirements respectively and are complying with their governing law and supervisory requirements. •Promptly advise institutions and plans in the event there are material deficiencies and take or require management, Boards, or plan administrators to take necessary corrective measures expeditiously. 10 TABLE OF CONTENTS •Advance and administer a regulatory framework that promotes the adoption of policies and procedures designed to control and manage risk. •Monitor and evaluate system-wide or sectoral issues that may impact institutions negatively. OSFI’s legislation has due regard to the need to allow institutions to compete effectively and take reasonable risks. OSFI’s legislation also recognizes that management, Boards of Directors, and plan administrators are ultimately responsible and that financial institutions and pension plans can fail. The Office of the Chief Actuary, part of OSFI, provides actuarial services to the Government of Canada. Who OSFI Regulates Banks (80) Trust Companies (47) Loan Companies (19) Cooperative Credit Associations (6) Regulation Regulation involves providing input into developing and interpreting legislation and regulations, issuing guidelines, and approving requests from federally regulated institutions as required under financial institution legislation. Supervision Supervision involves •assessing the safety and soundness of federally regulated financial institutions and pension plans, and •using supervisory powers to intervene in a timely manner to protect the rights and interests of depositors, policyholders, and pension plan members. OSFI supervises in accordance with its Supervisory Framework, introduced in 1999, and supplemented by its Supervisory Framework Rating Assessment Criteria, developed in consultation with industry and introduced in 2002. Guide to Intervention for Federal Financial Institutions OSFI’s activities can be divided into two broad functions: Regulation and supervision. OSFI and Canada Deposit Insurance Corporation (CDIC) jointly have developed a Guide to Intervention for Federal Financial Institutions. The Guide provides a framework for responding effectively to circumstances that could lead to the instability of a financial institution. Formalizing a process for early intervention if potential problems are identified increases the likelihood of averting the institution’s failure. The Society of Notaries Public of British Columbia Volume 22 Number 3 Fall 2013 Cooperative Retail Associations (1) Life Insurance Companies (78) Fraternal Benefit Societies (14) Property and Casualty Insurance Companies (172) The Guide explicitly describes the supervisory assessment and intervention process. It outlines the actions or options available to OSFI and CDIC, individually and jointly, to address the institution’s circumstances that are the source of concern. It also defines a graduated and progressive set of responses depending on the institution’s situation and the degree of weakness perceived. Table of OSFI Guidelines OSFI publishes guidelines that are essentially best or prudent practices that it expects financial institutions to follow. Guidelines are used to set standards to govern industry activities and behaviour. Those include solvency standards (capital adequacy), prudential standards (large exposure limits, portfolio mix), and accounting standards (e.g., nonaccrual loans, transfer of assets, etc.). Guideline B-20 More specific to mortgages, OSFI released the final version of the Guideline on Mortgage Underwriting Principles (B-20) on June 21, 2012. With growing household indebtedness, the potential adverse consequences of an erosion in lending practices is growing. It sets out expectations for prudent residential mortgage underwriting. The Guideline, Residential Mortgage Underwriting Practices and Procedures (B-20), builds on OSFI’s own domestic supervisory work and the Financial Stability Board’s international Principles for Sound Residential Mortgage Underwriting Practices (released in April 2012), but has been adapted to Canadian circumstances. The final Guideline is the result of a thorough consultation process, a summary of comments received, and OSFI’s responses to them. The Guideline applies to all federally regulated financial institutions engaged in residential mortgage underwriting and/or the acquisition of residential mortgage loan assets in Canada. It complements relevant provisions of the Bank Act, Trust and Loan Companies Act, the Insurance Companies Act, and the Cooperative Credit Associations Act, as well as the Government of Canada’s mortgage insurance guarantee framework. The Guideline outlines five main principles for prudent mortgage underwriting and/or acquisition. (Please see the list on page 18 of the Cover Story Interview.) With growing household indebtedness, the potential adverse consequences of an erosion in lending practices is growing. OSFI took action to ensure that financial institutions had a good understanding of OSFI expectations when it comes to underwriting mortgages and HELOCs1. Federally regulated financial institutions had to fully comply with the guideline no later than fiscal yearend 2012, with the relevant public disclosures in Q1 2013. s http://www.osfi-bsif.gc.ca/osfi/index_e. aspx?ArticleID=3 1 Home Equity Line of Credit Why invest the time to get to know our clients? Because we care to fully understand what you’re up against and where you want to go. We gain insight and real understanding so we can help you achieve your ambitions. it all starts with building a great relationship. Strong relationships with over 50,000 business clients across Canada have proven our commitment. BDO. MORE THAN YOU THINK. Assurance | Accounting | Tax | Advisory Suky Cheema, CA, Partner 604 688 5421 www.bdo.ca BDO Canada LLP, a Canadian limited liability partnership, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. BDO is the brand name for the BDO network and for each of the BDO Member Firms. Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 11 FEATURE: MORTGAGES Kevin Lutz The Mortgage Process 101 C hoosing the right mortgage term and options is very important. With the ongoing uncertainty of where interest rates are headed, homebuyers are struggling more than ever with decisions about their mortgage options. Pre-Approval 1.With a pre-approved mortgage, you’ll know how much home you can afford and how much your payments will be. You lock in your pre-approved interest rate for a set period of time to protect you in case rates rise while you are shopping for a home. If rates go down, you get the lower preapproved rate. 2.When you find the home you want, you will be ready to make an offer. The seller and Realtor will take it seriously, knowing you’ve got solid financial backing. 3.You are under no obligation to buy. 4.Your mortgage professional will tell you about the various mortgage options and offer advice about which options best suit your needs. 5.For the pre-approval process, you will need to provide details and documents for items such as employment, income, assets, downpayment, and liabilities and give permission for a credit bureau report. 12 TABLE OF CONTENTS How Much Mortgage Do You Need? That primarily depends on two things: Your income and your downpayment. Income Lenders qualify you using two standard ratios. • Gross Debt Service Ratio (GDS) Generally, no more than 32% of your gross annual income should go to “mortgage expenses” such as principal, interest, property taxes, and heating costs (plus maintenance fees for condo mortgages). • Total Debt Service Ratio (TDS) TDS evaluates the gross annual income needed for all debt payments including mortgage, credit cards, personal loans, car loans, etc. TDS payments should not exceed 40% of your gross annual income. The combined incomes for you and your spouse are usually considered when determining this ratio. The Downpayment The downpayment is that portion of the purchase price that you furnish yourself. For a CMHC-insured mortgage, there is a minimum downpayment of 5%. Be sure to reserve some funds to cover your home inspection, closing costs, moving, and other potential expenses. The Society of Notaries Public of British Columbia If your downpayment is 20% or more of the home’s purchase price, you can apply for a conventional mortgage. Conventional mortgages have the lowest carrying costs because they don’t have to be insured against default, a requirement in the Canadian banking system if you have less than 20% down. The downpayment represents your financial stake or equity in your new home. The balance of the money is borrowed from a financial institution in the form of a mortgage. It is to your advantage to save and put down as much money as you can because interest costs for a smaller mortgage are lower. Be sure to reserve some funds to cover your home inspection, closing costs, moving, and other potential expenses. Mortgage Payments Each of the following options can help you build your home equity faster. Accelerated Bi-Weekly Payments Save interest by increasing your mortgage-payment frequency. With an accelerated weekly or bi‑weekly payment option, you are essentially making the equivalent of one additional monthly payment each year, which will help pay off your mortgage faster. Scenarios 1, 2, and 3 compare monthly, accelerated bi-weekly, and accelerated weekly payments. Volume 22 Number 3 Fall 2013 Interest Saving Example Payment Scenario 1 Monthly payments Scenario 2 Accelerated bi-weekly Scenario 3 Accelerated weekly $1,664.32 $832.16 $416.08 Term Interest Cost $66,256.53 $65,036.82 $64,991.45 Amortization Interest Cost $249,152.06 $208,476.05 $208,197.95 30.0 years 25.8 years 25.8 years Proposed Amortization The above chart from the Royal Bank assumes the following. a. There is a constant interest rate throughout the amortization period. b. Interest is compounded semi-annually for fixed interest rates and each payment period for variable interest rates. c. The payment schedule you selected is maintained with no additional payments or skipped payments, unless selected by you. Source: RBC mortgage calculator at www.rbcroyalbank.com* Double-Up Your Payments Use a Shorter Amortization Period When you double-up a payment, your extra payment goes directly toward reducing the principal balance of your mortgage. A common option is that you can pay up to the equivalent of your regular monthly mortgage payment, whether it’s weekly, biweekly, or monthly. A shorter amortization period means higher regular payments but you will pay significantly less interest over the life of your mortgage because interest is being calculated on a lower principal balance. Make Extra Principal Prepayments The new B-20 mortgage guideline introduced by the federal government are impacting the way financial institutions lend money. The guideline have reset mortgage-lending rules to more conservative standards. The rule changes are broad based. 1.For borrowers without a 20% downpayment, mortgage amortization is reduced to 25 years from 30 years. Low-ratio home buyers with 20% or more down can still ask for a 30-year amortization. 2.As for the other rule changes, most borrowers are not affected or there is a minimal impact. If you already have a mortgage, be careful before altering its terms because some lending policies are being grandfathered. Work with an experienced, knowledgeable, and reputable mortgage professional before making any changes to your mortgage. Applying prepayments directly to your mortgage principal allows you to prepay a certain amount (usually 10%) of the original amount of your mortgage once in every 12-month period. When your mortgage is up for renewal, you can make a principal prepayment for any amount you wish. A principal prepayment of even $1000 a year can make a sizeable difference in the time it takes to pay off your mortgage. Increase Your Payment Amount Some mortgages allow you to increase the amount of the principal and interest portion of your mortgage payment by as much as 10% once a year. The increased amount goes directly toward your principal. Use Your RRSP Contributions Under the federal government’s Home Buyer’s Plan, first-time homebuyers are eligible to use up to $25,000 in RRSP savings per person ($50,000 for couples) for a downpayment on a home. The withdrawal is not taxable as long as you repay it within a 15year period. To qualify, the RRSP funds must have been in your RRSP for at least 90 days. Volume 22 Number 3 Fall 2013 New Mortgage Guidelines Could Affect You When you double-up a payment, your extra payment goes directly toward reducing the principal… The Scrivener Short-Term Strategy Can Mean Long-Term Stability Mortgage portability and assumption features are often overlooked and become much more important to you in an environment of increasing interest rates. Let’s assume . . . You are about to buy a home. •Interest rates could be higher 2 years from now. •You might sell in 2 or 3 years and purchase a different property. •You have limited cash flow and want to pay off your mortgage as quickly as possible. You see a low 2- or 3-year rate offer advertised and think Wow, that is a low rate. My payments and interest will be reduced if I choose that one. It fits with your strategy of timing the end of the mortgage term with the potential sale of your property. Now let’s look at how a longer-term mortgage could make more sense for you. Assume . . . •You decide to opt for a 5 or 7 year interest-rate term. •You still plan to sell in 2 or 3 years. If your mortgage comes with a portability option, you can transfer the terms and conditions of your current 5 or 7 year mortgage to a new home purchase when you sell in 2 or 3 years. Alternatively, if you need more money to pay for a new home, your mortgage can be increased and the existing low rate blended with the current posted rate to obtain a weighted annual interest rate. Depending on current rates and your final blended rate with the addon amount, your modified monthly payments could be more economical than with a brand new mortgage. In other words, today’s low interest rates coupled with the longer mortgage term can become your “asset” and an attractive choice that can save you money when your existing mortgage rate is lower than current rates. TABLE OF CONTENTS 13 The mortgage assumption option can be an asset and a good tactic, particularly if you have a low interest, longer-term mortgage in a buyer’s market and especially when mortgage rates are rising. Your existing low-rate mortgage can be an attractive feature for prospective buyers—you can allow a buyer to take over your mortgage or assume it. If rates are on the rise, your lowrate mortgage gives your buyer built-in monthly savings until the end of your mortgage term. The assumption option can help your Realtor sell your home. Please note: A buyer can assume your mortgage only if he or she meets the usual mortgage qualification requirements and if you decide not to take it with you to your new home. that varies with fluctuations in the bank prime rate will offer the greatest advantage when it comes to long-term savings on interest costs. The type of mortgage you choose really depends on your tolerance for risk, your current goals, and your stage of life. Here are some variable-rate payment details. •Regular mortgage payments are set for the term, even though interest rates may fluctuate during that time. Many variables must be considered when choosing the type of mortgage and term options best for you, especially in the face of changing mortgage rates. Consult a mortgage specialist for expert advice. •When rates go down, an increased amount of your payment goes toward paying the principal. With more going into your principal, the less interest you pay, and the faster the mortgage is paid off. Fixed or Variable? •When rates go up, you’ll see an increase in the portion of your payment that goes toward paying the interest. With less going into the principal, the amortization period is extended. You can choose to go with a stable, less-flexible fixed-rate mortgage or you may feel more comfortable with the risks and potential rewards of a variable-rate mortgage. The Case for Fixed Rate A fixed-rate mortgage offers a high level of stability because it provides a locked-in rate during the entire term. You know exactly how much principal and interest you will be paying on each regular mortgage payment. The down side is you can’t take advantage of a lower interest rate—and you don’t have the ability to put extra payments toward the principal. Fixed is for you if you enjoy the security of a rate guaranteed not to change for the term of the mortgage and you are willing to pay a slightly higher interest rate for that security. •You can always lock-in to a fixed rate mortgage. Choose a variable rate if you are comfortable with rate fluctuations to gain possible long-term interest savings and you have the flexibility to accept possible increases in your amortization, should the interest rate increase. Fixed and Variable Rates in One Mortgage Many lenders offer mortgages that can “hold” a combination of both fixed and variable terms. To benefit from potential interest savings and the security of a predictable rate, you can split your mortgage between fixed and variable rates with different terms and maturities. Whether rates remain stable or fluctuate, that strategy reduces the risk of making a bad decision and could save you thousands of dollars in interest costs over the life of your mortgage. Note: Most lenders require a somewhat larger downpayment for that product. The type of mortgage you choose really depends on your tolerance for risk, your current goals, and your stage of life. There’s more to mortgages than just great rates. Make sure you are getting a mortgage that gives you peace of mind with flexible options that allow you to pay down your mortgage fast. s Royal Bank of Canada does not make any express or implied warranties or representations with respect to any information or results in connection with the calculations in this article. Royal Bank of Canada will not be liable for any losses or damages arising from any errors or omissions in any information or results or any action or decision made by you in reliance on any information or results. Kevin Lutz is the RBC Regional Manager, Residential Mortgages. [email protected] Follow Kevin on Twitter @RBCKevinLutz The Case for Variable Rate 14 TABLE OF CONTENTS ©iStockphoto.com/Chagin Typically, variable rates include some of the lowest rates available but many Canadians shy away from the option because of the risk of rate increases. Many Canadian economic experts believe, however, that a mortgage rate The Society of Notaries Public of British Columbia Volume 22 Number 3 Fall 2013 New CMHC Tools for Homebuyers LEAVE A LEGACY OF YOUR OWN and feel great about the lives you’ll save These new tools are the latest additions to CMHC’s comprehensive suite of resources available to support Canadian homebuyers. •CMHC’s Debt Service Calculator allows homebuyers to evaluate their financial situation and understand how much they can comfortably afford to spend on a mortgage. The easy-to-use calculator allows users to quickly estimate their gross debt-service ratio (GDS) and total debt-service ratio (TDS), both important measures in assessing their financially readiness for homeownership. The Debt Service Calculator can be accessed on www.cmhc.ca (search “calculator”). IT’S MORE THAN A GIFT. IT’S TIME. Estate Litigation •Recognizing the increasingly fast-paced electronic and mobile environment, the “Ready, Set, Home” mobile app is a free application that offers quick and convenient access to CMHC’s extensive housing information. The app can be downloaded to your Blackberry, Android, or iPhone device at cmhc. ca/mobile. It provides consumers—especially first-time homebuyers— with comprehensive CMHC information and tools at their fingertips. The app helps homebuyers keep track of the details throughout the homebuying process and provides access to a variety of helpful calculators, articles, and other resources. For more than 65 years, CMHC has shared a wealth of knowledge and housing expertise, as well as useful tools and guidance, to help Canadians enjoy an informed and assured homebuying and homeownership experience. s Volume 22 Number 3 Fall 2013 Jane Westheuser Advisor, Gift Planning (604) 730-7370 [email protected] heartandstroke.bc.ca I can help. • Past President, TLABC • Past Chair Wills & Trusts Section, CBA • Over 38 years of litigation experience Trevor Todd Estate Litigation Referrals Welcome. P | 604 264-8470 www.disinherited.com E | [email protected] The Scrivener TABLE OF CONTENTS 15 FEATURE: MORTGAGES Mortgage Insurance Considerations T here has been a 425% increase in home values since the mid-1980s. The mortgage debt required to buy a new home or a re-sale (new homes have 51% larger mortgages) parallels that increase. Profile of the Mortgage Holder Value of Dwelling Have a Mortgage l l Monthly Mortgage Payment Monthly Disposable Income Owning Home <10 Years l l $1042 $6117 67.2 % National $303,700 57.3 % Age: <45 $297,000 86.9 % $1100 $6108 84.4 % Age: 45 to 64 $315,000 55.2 % $1017 $6392 50.4 % Age: >64 $275,700 15.1% $692 $4050 NA n Ontario $320,600 59.5 % $1183 $6525 66.7% British Columbia $458,900 54.5 % $1242 $6258 71.3 % Urban: >500,000 $358,000 60.4 % $1200 $6642 70.0 % Rural $229,900 $46.6 % $817 $4992 62.3 % Red = Above National Average Blue = Below National Average l Mean n NA: sample size too small to be reliable The Distribution of Mortgage Debt in Canada, Statistics Canada, April 27, 2011 A TD Economics Report (2010) found that while mortgage holders spend 30.2% of their disposable income on shelter and saved only 3,5%, mortgage-free home owners spent 14.9% on shelter and saved 14.7%—their biggest expenditure was on “transportation.” Triggering Events Statistics Canada (2011) reported an approximate 10-fold increase in mortgage debt and consumer debt over the past quarter century. Rising interest and inflation rates are gradual but loss of health or work is usually sudden, dramatically impacting an ability to service a mortgage, which can quickly cause financial disaster. Data from Countrywide Financial (2007) and Harvard University (2008) cite medical problems as significant contributors in foreclosures. Canadian actuaries project that: •45-year-old male nonsmoker: By age 65, 31% will be disabled longer than 90 days, 24% will have a critical illness, and 5% will die; •45-year-old female smoker: Respective percentages are 31% disabled, 17% a critical illness, and 11% will die. 16 TABLE OF CONTENTS Ian Callaway Mortgage Insurance Considerations To insulate mortgages and debt from unpredictable declining health, you can insure against disability, specified illnesses, and/or death. Insurance premiums are a function of contract access, design, scope, and restrictions. For a customized fit, consider the following. • Convenience: Some consumers simply apply for their mortgage insurance at the lending institution. • Underwriting: Insurance is frequently misperceived as a universally purchasable commodity. Some plans have very narrow risk-tolerance parameters with higher rejection rates while others are assessed on a case-bycase basis. • Ongoing Sum Insured: The level of coverage decreases on a prescribed schedule or the insured sum remains stable at the original insured amount that can cover re‑written mortgages and/or HELOCs. • Transferability: Some plans are tied to the specific initial mortgage debt and cannot be applied to new or increasing debt loads. They must be re-underwritten with each increase in amount, even with the same financial institution. • Recipient of Funds: For some plans, the lending institution becomes the effective recipient of the insurable proceeds by either forgiving the monthly payments or the loan balance. In other plans, the policy owner receives a monthly or lump sum; it is his or her choice where to direct the proceeds. • Creditor-Proofness: With a named beneficiary, proceeds are insulated from creditors. If proceeds flow through a third party and indirectly to a beneficiary, there is no such creditor protection. • Convertibility: Some insurance plans expire when the debt is retired. Others have an ability to convert to another plan that may never expire and provide tax-free cash. That is extremely important for estate planning, whether to cover deferred taxation, bolster depleted investments for a surviving spouse, cover capital gains taxes, or provide a tax-free gift or endowment. For each insurable defence, there are a variety of marketplace options that, other than premium, “appear” the same but are fundamentally different. s Ian Callaway, MA, MEd, RHU, BCFE, Insurance Analyst and Forensic Examiner, is a recognized Disability Insurance authority. Telephone: 604 629-0042 [email protected] The Society of Notaries Public of British Columbia Volume 22 Number 3 Fall 2013 COVER STORY: MORTGAGES The Evolution of Mortgage Brokering in BC www.wildmanphotography.com Samantha Gale, CEO of the Mortgage Brokers Association of BC, in conversation with Val Wilson The Scrivener: Mortgage brokers in British Columbia make a remarkable contribution to the provincial economy. Samantha: They do. Canadians shared a total outstanding mortgage balance of over $1.1 trillion in 2012, up significantly from the number in 2008, which sat at $858 billion.1 If BC represents about one third of mortgage transactions across the country and mortgage brokers are responsible for originating 25 percent2 of new residential mortgages, then we can see that BC mortgage brokers funded a staggering $84 billion of the total residential mortgage credit in BC. The Scrivener: Today, mortgage brokers are respected as go-to advisors in the field. That was not always the case. Samantha: It is true that mortgage brokers did not always enjoy such commonplace acceptance as financial intermediaries in the lives of Canadians. Back in the 1970s, 1Statistics Canada, Residential Mortgage Credit, last modified: 2013-08-30. 2Maritz, Consumer Mindset, CAAMP 2013 Consumer Survey Volume 22 Number 3 Fall 2013 the stereotype of the mortgage broker might be more aligned with that of a salesperson. The mortgage marketplace underwent a rapid transformation in that time period, starting with amendments to the Canada Bank Act in 1967. …BC mortgage brokers funded a staggering $84 billion of the total residential mortgage credit in BC. The Scrivener: What effect did the amendments have? Samantha: A 6 percent cap on interest rates that could be charged on residential mortgages by banks was eliminated in those amendments. Nonbank mortgage lenders were the primary mortgage lenders for the majority of Canadian households in the 1960s as the interests rate rose above 6 percent, pushing banks almost completely out of the mortgage market. The 1967 Bank Act amendments, however, eliminated the interest rate cap, which permitted banks to make conventional mortgage loans that were not insured. The Scrivener: How has the mortgage business fundamentally changed over the years? The Scrivener Samantha: One of the most important mortgage innovations of the last century was the implementation of mortgage-default insurance by the federal government. In an effort to stimulate the postWorld War II demand for housing, the government enticed lenders to increase their participation in the mortgage market by reducing the risk of financial loss resulting from mortgage defaults. The program clearly drew a greater array of mortgage lenders into the mortgage market and expanded available mortgage credit to Canadians. In addition, rapid inflation toward the end of the 1960s changed the nature of mortgage-lending practices. Inflation during that period is tied to increased consumer demand for goods, resulting in intensified competition for the supply of resources and available flow of capital. The Scrivener: What effect did that have on interest rates? Samantha: The squeeze on the money supply resulted in a correlating rise in interest rates. Long-term lenders who had previously enjoyed a steady period of relatively fluctuation-free interest rates found themselves facing a serious risk that loans were committed at interest rates significantly below the cost to source the funds. Consequently, mortgage agreements began to change. TABLE OF CONTENTS 17 The Scrivener: What were those changes? Samantha: Mortgages became partially amortized using terms, so that interest rates could ride the upward wave with repeated mortgage renewals. Partial amortization was a new concept that permitted borrowers to share with lenders the risks inherent in an inflationary economy. Those changes were only the beginning of an exponentially rapid evolution of the mortgage industry. The development of modern land and mortgage law, emanating from Anglo-Saxon England, spans a good thousand years. Current concepts of risk protection, payment plans, and mortgage options really only developed in the last 40 or 50 years. It is among this backdrop of change that the mortgage broker first appears in the lexicon of financial services discourse. There were now an array of options with different lenders, programs, and mortgage terms—the broker’s new niche role was to steer a client into the right option. The Scrivener: What was the primary function of the mortgage broker at that time? Samantha: By and large, the public was still dealing directly with banks and conventional lenders to facilitate mortgage loans. The mortgage broker’s primary role was to assist clients who had serious qualification challenges to find alternative lenders—clients that had been given a clear rebuff by their bank. The mortgage broker was characterized as an option of last resort for “bottom of the barrel” clients. The Scrivener: When was regulatory oversight introduced? Samantha: Regulatory oversight of mortgage brokers was implemented with the enactment of the Mortgage Brokers Act in 1972, at the time a most forward-thinking and innovative piece of legislation. British Columbia was one of the first provinces to license mortgage brokers and to set exceedingly high standards for brokers with a comprehensive licensing course borrowed from the more mature real estate industry. 18 TABLE OF CONTENTS In addition, the rise of associations has played a part in the development of the mortgage broker industry. Chartered in 1990, the Mortgage Brokers Association of BC is the oldest broker association in Canada. It developed a mortgage broker Code of Ethics and professional practice courses. Along with those developments, the role of mortgage brokers began to change significantly over time as lenders found it more economical and cost-effective to originate mortgages through the broker channel. Chartered in 1990, the Mortgage Brokers Association of BC is the oldest broker association in Canada. The Scrivener: What is the role of the mortgage broker today? Samantha: Mortgage brokers have truly transformed their role as the financing option of last resort to the option of first resort. Approximately 30 percent of mortgage borrowers utilize the broker’s negotiating power to find competitive mortgage terms and options. A recent economics study3 found that mortgage brokers with their competitive advantage in obtaining lower rates saved consumers $15.89 million in 2009. While this may not be a whopping number, it does have a tangible impact on the efficiency of the economy and provides clear cost-saving benefits to consumers. The role of the mortgage broker is in the process of transformation yet again, this time from rate negotiator to trusted advisor. Mortgage brokers represent borrowers and act as their agent not only to source the best mortgage but to advise on alternative choices with a long-term view of the client’s financial well-being and needs. 3 ndrew T Williams, An Examination of the A Canadian Mortgage Broker Industry, Acadia University, 2010 The Society of Notaries Public of British Columbia The Scrivener: What are other advantages to using the services of a mortgage broker? Samantha: Mortgage brokers have relationships with some lenders that the public would not ordinarily be able to access. They understand the lending strategy and requirements of various lenders and can assess the right fit for each client. The new B-20 OSFI guideline has tightened up prudential B-20 Guideline: OSFI Residential Mortgage Underwriting Practices and Procedures The Guideline outlines five main principles for prudent mortgage underwriting and/or acquisition. Federally regulated financial institutions (FRFIs) engaged in residential mortgage underwriting and/or the acquisition of residential mortgage loan assets in Canada should •have a comprehensive residential mortgage underwriting policy; •perform reasonable due diligence to assess the borrower’s identity, background and demonstrated willingness to service his or her debt obligations on a timely basis; •adequately assess the borrower’s capacity to service his or her debt obligations on a timely basis; •have sound collateral management and appraisal processes; and •have effective credit and counterparty risk management including, where appropriate, mortgage insurance. Volume 22 Number 3 Fall 2013 The Mortgage Industry in BC Lenders Regulator Private Unregistered Not Regulated Mortgage Brokers Registrar of Mortgage Brokers (FICOM) Market Conduct Private MICS Monolines Syndicators BC Credit Unions BC Insurance Company MBABC BC Ministry of Finance Superintendent of Financial Institutions (FICOM) Prudential BC Trust Company Borrowers Government Oversight Federal Insurance Companies Credit Unions Trust Companies Banks External Complaint Body Office of the Superintendent of Financial Institutions OSF Prudential Federal Ministry of Finance Financial Consumer Agency – FCAC Market Conduct High Ratio Insurers Canada Mortgage & Housing underwriting criteria for federally regulated lenders (FRFI) such as banks and have made it more challenging for borrowers to obtain mortgage financing. The guideline governs loans secured against residential properties, home equity lines of credit (HELOCs), and home equity loans. Mortgage underwriting has undoubtedly become more complex as a result of B-20. Loan approvals now require more extensive documentation; banks have adopted their own unique policies that set out more strict approval criteria. While B-20 may create extra hurdles for mortgage borrowers, there is now a correlating need for borrowers to obtain advice— advice from the mortgage broker. Today it is not as easy for borrowers to obtain a quick mortgage approval from their bank because they may not satisfy the bank’s B-20 qualification criteria. Borrowers may not know which alternative bank or mortgage lenders to go to if rejected Volume 22 Number 3 Fall 2013 by their own financial institution. A mortgage broker may therefore be more essential than ever for borrowers in today’s B-20 underwriting climate. The Scrivener: Please tell us more about the work of the Mortgage Brokers Association of British Columbia. Samantha: One of the goals of the MBABC is to support the mortgage broker in fulfilling his or her role as mortgage advisor by strengthening ethical and practice standards through the delivery of professional development education and practical courses. To that end, the MBABC has created the Mortgage Brokers Institute of BC, which delivers re-licensing education and postlicensing courses for managers, broker owners, and brokers. The 1972 Mortgage Brokers Act is also undergoing an overhaul by the Ministry of Finance, which will provide an opportunity to modernize the licensing regime. The MBABC acts as an advocate of the industry and The Scrivener the public by championing modern reforms, such as a greater role for the industry in its own regulation, the creation of personal mortgage broker corporations, and creating clearer guidelines for the charging of broker fees. The Scrivener: What do you see for the future? Samantha: The mortgage broker industry in BC has truly undergone a transformation, to prudent mortgage shopper and mortgage advisor and planner. Enhanced practice standards and a modernized licensing regime will undoubtedly further redefine the mortgage broker’s advisory role for property owners seeking mortgage planning and advice. With mortgage brokers in BC having funded $84 billion of current mortgage financing, they make a vitally important contribution to the BC economy. s TABLE OF CONTENTS 19 FEATURE: MORTGAGES Rob Regan-Pollock W hen I first started in the business, Mortgage Brokers were known as intermediaries who assisted borrowers struggling to obtain institutional financing. In fact prior to meeting me, my lovely wife used a mortgage broker when her bank thought she lacked sufficient work experience to buy her first condo. She met Francine with a mortgage broker who found a trust company willing to approve her mortgage even though she had only recently started her new career. This role of matchmaking client profiles with available lenders is still the foundation of what we do today. When I began my career 20 years ago, 11 lenders worked with mortgage brokers; we had approximately a 5 percent share of the residential mortgage market. At that time no one really knew what mortgage brokers did. I spent most of my day explaining to Realtors and bankers that I represented options from more than one lender. Choice and ability to provide financing alternatives through one point of contact was our young industry’s unique selling proposition. 20 TABLE OF CONTENTS With the advent of securitization and demutualization of life insurance companies, competition for mortgage business grew and mortgage brokers became vital as a distribution network for a multitude of lenders. The taps opened and we had many more choices as distributors of mortgages offered by life insurance companies, trust companies, banks, and credit unions. With that came the ability to offer discounted mortgage rates. I recall being so happy to be able to offer discounted mortgage rates and one-stop-shopping to my clients. It didn’t take very long for large institutional lenders to figure out how to use their economies of scale to compete with brokers and match our discounted rates. On a daily basis we assist borrowers in orchestrating their transaction and work with other professionals to ensure all goes according to plan. So what do you do when your competition matches pricing? Like any service-provider, we looked at what else we could do to add value. That is when we became product experts and sought to add value through knowing all the pros and cons The Society of Notaries Public of British Columbia Photo courtesy of CAAMP A Day in the Life of a Mortgage Broker of each offering. We raised our profile through advocacy and letting clients know what they didn’t know or wouldn’t know to ask. Like many brokers, I became familiar with all borrowing programs and an expert in all the lenders’ offerings. Whether our clients had concerns about assumability or zero lot lines, we became a vital resource for borrowers, Realtors, lenders, and legal professionals. Because mortgage brokers are involved with everyone in the financing process—the client, the lender, legal professional, Realtor, appraiser, and so on, our ability to structure the logistics became another key reason to work with a professional broker. On a daily basis we assist borrowers in orchestrating their transaction and work with other professionals to ensure all goes according to plan. By the early 2000s, our market grew to over 50 institutional lenders; the mortgage broker share of the residential market had grown to approximately 30 percent in BC. First-time buyers using mortgage brokers increased to approximately 45 percent. After the government announced changes to mortgage rules last year, we entered yet another evolutionary crossroad as mortgage brokers. Some of the challenges mortgage brokers are facing include headwinds from government tightening of mortgage Volume 22 Number 3 Fall 2013 credit, record levels of consumer debt, and a slowdown in home value appreciation. to formulate a long-term plan and assisting them in the management of their debt is the new frontier. These challenges are creating a need for mortgage brokers to reinvent themselves yet again. Some mortgage brokers with established client data bases are taking on more of a debt-management role and working beyond the transaction to assist clients long term. Others are looking at nonconforming or solutionsbased lending for clients who may no longer qualify. While selection, price, convenience, and product expertise are still key to what we offer, advocacy, planning, and management are where I see our industry going. After 20 years, I am extremely grateful to be in such a dynamic profession and very much appreciate the opportunity to share what we do day-to-day with our colleagues at The Society of Notaries Public of BC! s The issue with debt as evidenced in Europe and the US is that it is sticky. The government can tighten and make changes to promote stability, but those changes don’t reduce the amount owed by existing borrowers who may no longer qualify. Those borrowers still need access to capital and a solid plan for reducing debt over time. Mortgage brokers are meeting that need wherever possible. Rob Regan-Pollock became a mortgage broker in 1994 after a 10-year career as a pilot with Canadian Regional Airlines. Starting as a junior broker for the Citifund group of companies, he worked his way up to Nominee and Manager of their Residential Division. In 1997 he moved to MPMC Mortgage Corp. and returned to work with clients as a fulltime broker. MPMC Mortgage Corp. merged with Invis in April 2001. Since then, Rob has progressively built his client base and hired seven I am confident mortgage brokers will continue to thrive even in these challenging times. Working with clients assistants to help him manage his book of business. Rob’s passion for the industry led him to serve as Chair of Professional Development for the Mortgage Brokers Association of BC from 2006 to 2011. He has also served on the Canadian Association of Accredited Mortgage Professionals Board of Directors as Director at Large representing MBABC interests. In 2010, Rob joined the Mortgage Brokers Institute of BC as a Director to assist in the development of Mortgage Broker re-licensing education for the Province of British Columbia and was recently appointed President of MBIBC. Francine Regan-Pollock, Rob’s wife of 23 years, is also a mortgage broker. She shares his enthusiasm for this great industry. When not working, Rob enjoys the great outdoors and travels. [email protected] THE BEST ADVICE YOU CAN GIVE IS TO HELP YOUR CLIENTS GIVE WISELY. The Victoria Foundation is one of the oldest community foundations in Canada. With total assets of over $180 million we grant over $10 million annually to worthy causes. Recommending the Victoria Foundation as the recipient of legacy gifts offers your clients maximum flexibility to contribute to causes they care about. Learn more about how to connect people who care with causes that matter. Call Sara Neely at 250.381.5532 or email [email protected] VICFO_7363_VF098.indd 1 Volume 22 Number 3 Fall 2013 www.victoriafoundation.bc.ca 12-06-18 2:44 PM The Scrivener TABLE OF CONTENTS 21 FEATURE: MORTGAGES Regulating Mortgage Brokers in British Columbia I n British Columbia, mortgage brokers are regulated by the Office of the Registrar of Mortgage Brokers at the Financial Institutions Commission (FICOM). FICOM safeguards confidence and stability in BC’s financial sector by protecting consumers from unfair market conduct and undue loss. FICOM achieves this goal through administration of nine statutes that trust in the financial sector begins with the mortgage broker and real estate industry. The US real estate market crash and subsequent recession illustrate the significant impact that mortgage broker and real estate industry conduct can have on the public and the economy at large. FICOM safeguards confidence and stability in BC’s financial sector… regulate the real estate and mortgage broker industry, financial services industry, and pension plans. Registrar of Mortgage Brokers For many British Columbians, a mortgage is the largest and most important debt they will incur in their lifetime and represents their most significant interaction with the financial sector. Public confidence and The Mortgage Brokers Act (Act) and regulations provide a framework for the registration and regulation of mortgage brokers in British Columbia. Acting through her Office, the Registrar of Mortgage Brokers Carolyn Rogers •regulates the activities of BC’s mortgage broker industry, including over 3200 mortgage brokers and almost 1000 brokerages; ©iStockphoto.com/monkeybusinessimages •enforces mortgage broker suitability requirements; and 22 TABLE OF CONTENTS The Society of Notaries Public of British Columbia •protects consumers from unfair mortgage broker market conduct by investigating and prosecuting breaches of the legislation. Staff at the Office of the Registrar have decades of regulatory and investigative experience. The team draws on its private sector experience in mortgage brokering and underwriting to evaluate the impact of regulatory decisions on industry. Volume 22 Number 3 Fall 2013 Current Strategic Priorities The Office of the Registrar monitors market risks and responds pro-actively to address potential harm and achieve regulatory compliance. Current areas of focus include the following. • Participants in mortgage fraud •Deceptive acts and business practices •Unregistered mortgage brokering, including the facilitation of unregistered activity by registered parties. A regulatory decision by the Registrar of Mortgage Brokers can result in administrative penalties of up to $50,000, orders for costs, the suspension or cancellation of a registration, and orders to cease activities or carry out specific actions. Prosecution as a provincial offence could result in more significant fines or imprisonment. Offences may also be prosecuted under the Criminal Code of Canada. Becoming a Mortgage Broker Anyone performing mortgage-arranging, lending, administration, or trading is required to become registered under the Act. There are some exemptions to the Act’s licensing requirement, for example, insurance companies and savings institutions and their employees. All applicants must satisfy education and specific suitability requirements to qualify for registration. The online Mortgage Broker E-filing system allows Designated Individuals of mortgage brokerages registered in BC to submit new registration, renewal, and reinstatement applications and to amend, transfer, and terminate registrations. Review of the Mortgage Brokers Act Readers with an interest in the mortgage industry are encouraged to participate in Government’s review of BC’s Mortgage Brokers Act (http://www.fin.gov.bc.ca/cep/fcsp/ consultMBA.htm). The purpose of the review is to identify and address any legislative aspects that may expose consumers of mortgage products to unnecessary financial risk or create undue inefficiencies in the market. s Contact FICOM Financial Institutions Commission http://www.fic.gov.bc.ca/ Office of the Registrar of Mortgage Brokers 3216 •Companies (including Branches) 992 •Mortgage Investment Corporations (included in Companies) 147 Q: Since the 2008 changes we have seen in our economy, what has been the registration trend? Have brokers declined in number? A:We have seen an upward but declining trend in total individual broker registration numbers (5% growth in 2010 to 1.5% growth in 2012). It is likely we will see a decline in total broker registration numbers in 2013. Volume 22 Number 3 Fall 2013 When you’ve got Strata questions . . . If one unit floods another unit in our building who pays for what? How do we deal with a noisy and disruptive tenant or owner? How can our strata corporation afford a big repair? What’s a Depreciation Report? We have the answers. 604 660-3555 [email protected] Number of Registrations as of August 26, 2013 •Individuals ACCESS LAW GROUP Q: How many new registrants were there over the last 12 months? Jamie Bleay 604-801-6029 jbleay@ accesslaw.ca Phil Dougan 604-628-6441 pdougan@ accesslaw.ca Geoffrey Trotter 604-678-9190 gtrotter@ accesslaw.ca A: T here were 365 new submortgage broker registrants and 79 new mortgage brokerage registrants. Q: Over the course of the last year, have you experienced any new issues or challenges in your role as a regulator? A: T here is increased risk of misconduct due to a softening real estate market. Competitive pressure among industry rivals can increase the risk of regulatory misconduct. The Scrivener 1700 – 1185 West Georgia Street Vancouver, BC V6E 4E6 P: 604-689-8000 F: 604-689-8835 www.accesslaw.ca TABLE OF CONTENTS 23 FEATURE: MORTGAGES Photo credit: Appraisal Institute of Canada Janice P. O’Brien The Residential Appraisal Process and Mortgages P roperty owners can save time, expenses, and heartache by first consulting with a designated member (AACI or CRA) to conduct a comprehensive valuation of their property. An Appraisal Institute of Canadadesignated appraiser can provide an independent and unbiased assessment of the value of a home prior to buying, renovating, or refinancing. AIC members are engaged by a wide range of clients to provide a professional opinion or consulting services on the quality, value, or utility of a specific property. Appraisals may be required for any type of property—single family homes, small and large rental properties, condominiums (townhomes and apartments), office buildings, shopping centres, hotels, industrial sites, farms, to a name a few—whenever real estate is sold, mortgaged, assessed, insured, or developed. Understanding the Residential Appraisal Process One of the key methods in valuing a residential property involves comparing properties that have recently sold within the neighbouring area and that offer similar characteristics to the property being valued. 24 TABLE OF CONTENTS •For mortgage financing purposes, a residential property can be a single-family dwelling, duplex, triplex, fourplex, or an undeveloped residential dwelling site. Tips for Hiring the Right Appraiser •Ask an appraiser for his or her professional designation. Be sure it is from a strong professional association such as the Appraisal Institute of Canada. Search online at AICanada.ca on “Find an Appraiser” for an appraiser in your area. AIC members are engaged by a wide range of clients to provide a professional opinion… •Ask a professional appraiser if he or she has significant experience in the type of valuation services you require. •you engage a professional who adheres to the Appraisal Institute of Canada’s Code of Ethics and Canadian Standards of Professional Appraisal Practice; and •you receive an independent and unbiased opinion of value supported by comprehensive market research and analyses. The Assignment Terms of Reference of the appraisal assignment should be in writing and agreed by the parties prior to the assignment to avoid any misunderstanding or additional work to amend the valuation report. The typical terms and conditions that should be taken into consideration when hiring a designated appraiser include the following. •Purpose •Intended Use •Don’t be afraid to ask for references! •Intended Users of the Report Hiring an Aic-Designated Appraiser: Key Things to Consider •Type of Appraisal Report By hiring an AIC designated appraiser, •you retain a qualified professional who has successfully completed the AIC’s rigorous education, field experience, and examination requirements that each AIC designation demands; The Society of Notaries Public of British Columbia •Appraiser Client •Effective Date •Assumptions Made •Appraisal Fee •Conflict of Interest •Due Date •Appraiser’s Certification Volume 22 Number 3 Fall 2013 Who’s Involved in Financing or Refinancing Your Property Whether buying or refinancing a home, it is important for you—the consumer—to understand where the appraisal report falls within the overall mortgage loan process. There are many parties involved and each plays a critical role within the transaction. •Realtor or seller •Lawyer •Institutions regulated by the federal government: Major banks, trust companies, foreign banks, loan companies, insurance companies, to name a few •Lending institutions that are nonfederally regulated (for example, mortgage brokers, credit unions) •Appraisal Management Companies (AMCs) •Property Inspectors: Specialized contractors with expertise in uncovering defects in the structure and materials of various types of properties •The Appraiser Traditionally, the appraiser had a direct relationship with lenders, brokers, and mortgage insurers. Since the mid-1990s, the lending industry has placed an increased reliance on computer-generated mortgage approval processes. Under certain conditions, obtaining an on-site appraisal of the property process is bypassed altogether and a mortgage application may not necessarily involve an actual appraisal or on-site visit to the property by a qualified and designated appraiser. The Appraisal Institute of Canada recommends the completion of a comprehensive real estate appraisal by a qualified appraiser to ensure that financing is completed with an accurate and current estimate of the property’s market value. Volume 22 Number 3 Fall 2013 What to Expect During a Property Inspection An inspection is just one of the many tasks performed by an appraiser. Appraisers must be familiar with the property inspection process and observe the components and characteristics of the subject property that will influence value in the marketplace. The appraiser’s inspection takes into account a number of key elements including these. •The physical characteristics of the dwelling and any outbuilding(s) •Interior and exterior finishes and systems such as heating and cooling •The quality of any improvements •Any deficiencies or required repairs In addition to understanding the dynamics of the real estate market in the area, designated appraisers also have construction skills and knowledge, which are fundamental to their training. Members also rely on the expertise of industry professionals where building characteristics are more complex. Whether it is the consumer or the lending institution that engages an appraiser to value your home, the appraiser will do the following. •Set a convenient time for an inspection. interior photos are requested by the appraiser’s client. •Ask you about important features of your property such as original date of construction, dates of any major additions or renovations, and extra features, to name a few. •Gather information about recent marketing activity on your home. While public information is often available, the appraiser may inquire about any listing of the property (including private listings) or offers to purchase in the past 12 months, as well as any sales of the property for the previous 3 years. Consumers often want a preliminary estimate of value before the appraiser leaves the property. It is important for consumers to understand that most of the valuation process occurs after the inspection. The inspection allows the appraiser to gather sufficient information to properly describe the property. Estimating the market value requires the appraiser to complete a thorough analysis of market conditions and market activity. It is often a complex process that involves collection and analyzing between 3 and 10 (sometimes more) comparable properties to form a reliable estimate of market value. As a consumer, that is what you are paying for—an independent and unbiased opinion of value by a qualified appraisal professional. •Spend 20 to 40 minutes or more for the inspection, depending on the size and characteristics of the property. •Collect as much information as possible during the inspection of the home on the interior and exterior of the property— for example, room layout, improvements, dwelling measurements, information on any outbuildings such as garage or site improvements. ©iStockphoto.com/www.pinmyst.com An inspection is just one of the many tasks performed by an appraiser. •Take photographs to provide a visual representation of the data described in the report. Exterior photos are important to clearly identify the property and its characteristics. Sometimes, The Scrivener TABLE OF CONTENTS 25 Open Your Doors to a New Wave of Customers! The Boomer-Senior Market Wants to Do Business with People They Trust . . . People Who Have Taken the Time to Learn about Their Needs! We Have Helped Thousands of Businesses Grow by Teaching What Boomers and Seniors Want and How They Wish to Be Treated! Call Us Today to Learn How We Can Help Your Business Grow! Who is the Appraiser’s Client? Appraisers work on a confidential basis with their clients, in the same fashion as other professionals such as legal professionals and accountants. When a mortgage broker or lender requests an appraisal, the broker is are the appraiser’s client, regardless of who pays the appraisal fee. Under the Appraisal Institute of Canada’s Standards of Professional Appraisal Practice, any discussions on or disclosure of information contained in an appraisal report must be done with the written consent of the appraiser’s client. When a lending institution requires an appraisal report on a property, often it will engage an Appraisal Management Company (AMC) to act as an intermediary to facilitate the appraisal process on its behalf. AMCs offer their clients a single point of contact for management of the appraisal function; they have a contractual relationship with both their lender clients and the appraisal practitioner. In the process where an AMC has acted for a lending institution, the AMC is considered to be the client and retains control over the appraisal report. While there are a number of layers to the appraisal process, appraisers, AMCs, and lending institutions are focused on making the process as seamless as possible to the consumer. Appraisers work on a confidential basis with their clients, in the same fashion…as legal professionals and accountants. Founder, Rhonda Latreille, MBA, CPCA 1-877-272-8086 www.CPCAcanada.com 26 TABLE OF CONTENTS Education and Accreditation AIC grants the distinguished Accredited Appraiser Canadian Institute— AACI™ and the Canadian Residential Appraiser—CRA™ to individuals across Canada and around the world. The Institute is committed to high professional standards. These designations recognize highly qualified individuals who have completed the AIC’s rigorous curriculum, experience, and examination requirements. The Society of Notaries Public of British Columbia Members must successfully complete a comprehensive course of studies in all aspects of real estate valuation in addition to, or as part of, an undergraduate degree and meet other professional requirements including applied experience and examination (written and oral) prior to being awarded use of the CRA or AACI designation. Since 1998, the Real Estate Division of the Sauder School of Business at the University of BC has administered the AIC education program—the necessary courses leading to both designations. The courses are offered in a distancelearning format, providing students across the country with ready access without having to travel to attend classes at a university or college. The program has been designed for practitioners already employed in the appraisal industry who want to upgrade their education and for highly motivated people seeking to enter the profession. The workload is challenging. Diligence, organization, and self-discipline are vital. The Internet is used as a supplemental resource as is the use of videos in some courses. About Appraisal Institute of Canada Founded in 1938 and celebrating 75 years this year, the Appraisal Institute of Canada (AIC) is the premier real property valuation association in Canada. The Appraisal Institute of Canada is a selfregulating professional organization with over 4800 members across the country—1000 in British Columbia. For more information, visit www.appraisal.bc.ca. For a complete copy of the Consumer’s Guide to Understanding the Residential Appraisal Process, visit http://www.aicanada.ca/industryresources/consumer-guides. s Janice P. O’Brien, CAE, is the Executive Director of the Appraisal Institute of Canada–BC. Telephone 604 284-5515 [email protected] www.appraisal.bc.ca Volume 22 Number 3 Fall 2013 FEATURE: MORTGAGES Chuck Salmon M ost mortgage companies require either a survey or mortgage insurance. Obtaining a survey is more timeconsuming and may cost more so title insurance may appeal to people who just want to get on with it. Basics of a Building Location Survey •It is based on a physical site inspection with measurements taken by a qualified surveyor. Wouldn’t you rather know that there is a problem prior to your purchase, rather than wait until you are selling your property later? Your mortgage insurance might not cover your claim. There is no small print with a survey. ©iStockphoto.com/Klubovy building locations that may need to be resolved before completing a purchase •It is simple to read and understand. •Information to determine if buildings meet local zoning with respect to setbacks •You receive a signed and sealed Certificate showing the boundaries of the property according to the plan or legal description on which the title is based. •A range of preliminary planning options, from potential building additions and improvements to determining if further subdivision may be possible •The survey includes a graphical sketch showing the location of buildings, other improvements, easements, rights of way, and covenants. Other interests on the property, such as building schemes and covenants not defined by survey, would be listed for information only. Building Location Surveys have been widely used in BC for over 40 years. An integral part of a real estate transaction when provided to your lawyer or Notary, they are a longterm reference for the property owner as both a record of the state of the property when it was purchased and as a planning tool. Look at a survey as preventive maintenance. Wouldn’t you rather know that there is a problem prior to your purchase, rather than wait until you are selling your property later? Volume 22 Number 3 Fall 2013 The Scrivener The Role of a Professional Survey in the Mortgage Process Benefits of a Building Location Survey •Disclosure of encroachments from or onto the property •A clear depiction of any problems relating to encroachments or The Scrivener We sometimes tend to gloss over details and look for the simplest solution. When purchasing your next house, get a survey—or recommend a survey to your client. That professional survey will be useful for many years to come. s Chuck Salmon, BCLS, is the Secretary Registrar of the Association of BC Land Surveyors. He has been a BC Land Surveyor for 35 years and was the Surveyor General of BC until his retirement in 2002. [email protected] TABLE OF CONTENTS 27 FEATURE: MORTGAGES John Leech Dream Home or Nightmare? T he goal of most home seekers is finding the right place at the right price, with a manageable mortgage. The next crucial step is finding a qualified, capable home inspector. Pre-purchase property inspections are not required to get a mortgage, warns Peter Link, CTech, CPI, RRFA, a long-time Certified Property Inspector and former bank appraiser. “Lending institutions and insurers normally require a professional appraisal —but that addresses only the comparative current market value of the property. It does NOT reflect the true condition of the home— something that the buyer absolutely needs to know.” was a good beginning, but it left consumers confused. Each of these organizations has different standards. And 2 of the 4 are Ontario-based.” qualified inspectors, Premier Clark this Spring commissioned the Honourable Rich Coleman, Minister Responsible for Housing, to strengthen consumer protection by fixing the process. ASTTBC fully supports this initiative— urging one consistent set of training standards and one inspection template or Standard of Inspection. After reports of incompetent inspections by some inadequately The strongest recommendation I can offer any BC home buyer is a visit to www.asttbcpi.org. How to Find a Truly Capable and Trustworthy Inspector The strongest recommendation I can offer any BC homebuyer is a visit to www.asttbcpi.org. The Professional Inspection page shows a BC map. Simply click on your own region to choose from the complete list of ASTTBC-Certified House Inspectors. ASTTBC endorses training programs offered by BCIT, Okanagan College, and the Vernon-based Western Pacific Property Inspection Institute, whose Director of Education is Barry Brooks, MSc, AScT, CHI, RRFA (L), PEng. Peter manages examination and registration of Certified House and Property Inspectors for ASTTBC, a professional association of technology professionals in its 55th year, approved to certify house and property inspectors who are then formally licensed by Consumer Protection BC. 28 TABLE OF CONTENTS ©iStockphoto.com/3Djml Since 1995, ASTTBC has certified only the Province’s very best-trained, qualified, and experienced inspectors. Peter notes that when BC became the first province to require licensing of all house inspectors in 2009, Consumer Protection BC authorized four separate licensing bodies. “Requiring licensing The Society of Notaries Public of British Columbia Brooks says that choosing an ASTTBC inspector assures you of a thorough, fully backed inspection to the highest industry standard. CHIs have completed BC’s most rigorous field-audited training, including units required by no other BC licensing agency—a Building Code Course, an Asbestos Recognition Course, and a Building Envelope Course that far exceeds all others. Volume 22 Number 3 Fall 2013 ASTTBC is among BC’s top10 self-governing professional associations. The Association was incorporated legislatively under the ASTT Act of 1985 and registers some 10,000 Technology Professionals in a host of Applied Science occupations. s Inspections Should Tell All A thorough inspection should include all items of concern to the client. Current Standards of Inspection demand only visual inspection, but competent professionals can detect and draw attention to hidden problems like pipes leaking behind walls, rot or mould under siding, electrical issues, slumping retaining walls, and so on. Realtors are not permitted to recommend specific inspectors because of consumer protection rules and Realtors’ conflict of interest regulations. Banks and credit union lenders are not permitted to recommend a specific inspector. They may, however, offer a list of choices. John Leech, AScT, CAE, is a registered Applied Science Technologist. He joined ASTTBC in 1974 as its Registrar and became Executive Director in 1978. John was instrumental in gaining professional recognition for technology professionals registered with ASTTBC. Past President of the BC Chapter and Past Chair of the National Board of the Canadian Society of Association Executives, he makes his home on Vancouver Island. Seller’s Disclosure forms omit important questions. They allow for misleading “I don’t know” responses. In a perfect world, they might include the equivalent of a marriage vow coverall: “If anyone knows any reason why this house should not be purchased as is, speak now!” [email protected] ©iStockphoto.com/www.zazzle.com/Islandman Covered by $1 million in Errors and Omissions Insurance, ASTTBC members are subject to a court-tested dispute resolution system designed to protect the public interest. Our record adds up to service that every BC homebuyer can trust. Gifts to the Canadian Cancer Society fund research and prevention initiatives and help families like the Kents create life-changing memories at Camp Goodtimes. Join the fight. Leave a legacy. cancer.ca Did you know that a legacy gift to the Canadian Cancer Society can fight cancer and protect your estate from tax? The Estate Tax Eliminator Clause can reduce your final taxes to zero. You can help fund the best cancer research, prevention and support programs. For your copy of the Estate Tax Eliminator Clause and a Personal Estate and Will Planning Guide, please contact Toni Andreola at [email protected] or call 1 800 663 - 2524. Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 29 FEATURE: MORTGAGES Daniel Boisvert Mortgage Refinancing through Your BC Notary W hen refinancing a mortgage on an existing property, most people go to their bank to get approved for the additional funds. The bank often states the borrower can make use of the bank’s lawyer to do the legal work and that it will cost a little bit less than sending the work to an outside legal professional such as a BC Notary. lawyer does not cover. Why? The Notary is representing the borrower. For the vast majority of Canadians, their home is their largest and most important financial asset. •The Notary looks at the title for any defects or errors that may negatively affect the borrower, not just the lender. •The Notary tells the borrower about those issues and, if asked to do so, can manage them. for the borrower who may be asking very valid questions about the ramifications of signing the refinancing documents. •The Notary does tax searches on the property. A Notary Public representing the borrower will take care of many steps and searches that the work of bank’s •The Notary does strata searches, if applicable. •The Notary double-checks that the proper home insurance coverage is in place. My experience shows me that a Notary’s fees to work with the borrower are very similar to the fees a bank would charge. •The Notary double-checks the legal mortgage being registered to ensure that the bank’s figures are correct and that there are no mistakes that could negatively impact the borrower. The borrower—to protect his or her interests—will benefit from some specific information about the refinancing process. There is more to a refinance than simply borrowing more money from a financial institution or switching the mortgage to another source. 30 TABLE OF CONTENTS ©iStockphoto.com/keithfrith In the work the bank’s lawyer does for the transaction, only the bank’s interests are protected. The borrower must sign a waiver that he or she is waiving legal advice. During the signing appointment, the borrower is not permitted to pose any legal questions to the lawyer witnessing the signing of the documents and the lawyer is not permitted to answer such questions. That can be very frustrating The Society of Notaries Public of British Columbia For the vast majority of Canadians, their home is their largest and most important financial asset. A homeowner should take the utmost care and pay close attention during transactions that affect that asset. By hiring a BC Notary Public to look after his or her interests in such transactions, the borrower ensures that a highly trained professional is overseeing the process. s Daniel Boisvert is a Notary Public practising in Delta, BC. [email protected] Volume 22 Number 3 Fall 2013 FEATURE: MORTGAGES Andrew Bury Mortgage Enforcement in British Columbia A mortgage is “a conveyance of property as a security for the payment of a debt or the discharge of some other obligation for which it is given, the security being redeemable on the payment or discharge of such debt or obligation.”1 A mortgage is comprised of two parts: a.a promise to satisfy an obligation (usually, pay a debt) (a “Covenant”); and b.a conveyance of property2 as security for the Covenant (a “Charge”). What Does a Mortgage Charge? Although mortgages most commonly charge only real property (land), the Charge can be over any type of property: real property, personal property, incorporeal property, or any combination of those. Mortgages of real property are exactly that; the Charge gives the lender as security for the Covenant an interest in the real property charged and buildings and fixtures (which at law are treated as part of the real property), and nothing more. 121 Halsbury, Laws of England, lst ed. (1912), p.70 2or, arguably, now only a charge on property as a result of section 25 of the BC Land Title Amendment Act, S.B.C. 1989, ch. 69 Volume 22 Number 3 Fall 2013 What Rights Does a Mortgage Lender Have? From a lender’s perspective, a mortgage is essentially security for money lent. Lenders have rights against the parties to the Covenant (rights “against the person” or Rights in Personam) and they have rights against the property that is the subject of the Charge (rights “against the property” or Rights in Rem). In Personam There is one principal legal remedy for lenders enforcing rights in personam; they are enforced through the Court by Judgment. Covenants are then merged in Judgments and lenders have the (often unsatisfactory) methods of enforcing (or “executing on”) Judgments, available to any other successful litigant. Exigible property of the parties to the Covenant (then “Judgment debtors”) may be sold, by the Court Bailiff or otherwise (if any such property can be found). And Orders of the Court may be obtained requiring Judgment debtors to make payments in satisfaction of Judgments. In Rem There are two remedies for lenders enforcing rights in rem; sale and foreclosure. Sale By far the most common method of enforcing rights in rem is by sale through the Court. Ownership of real property is fairly certain and simple, The Scrivener due to the Torrens land title system in British Columbia. Real property cannot be moved out of the jurisdiction or otherwise hidden. And there is always a reasonably active market for real property. By far the most common method of enforcing rights in rem is by sale through the Court. Foreclosure This is the “original” method of enforcing mortgages. Lenders can obtain from the Court in a legal proceeding commenced by the lender to enforce the mortgage (a “Foreclosure”) an Order (an “Order Absolute”) that has the effect of extinguishing all rights of the borrower and all parties with interests in the real property that is the subject of the Charge ranking subsequent to the lender. An Order Absolute makes the lender the legal and beneficial owner of the real property and vests title to the real property in the lender free of all charges except those of parties with interests in the real property ranking prior to the lender (for example, property taxes, most condominium charges, etc.). A lender can register an Order Absolute at the Land Title Office, which will create a new title to reflect the foregoing. An Order Absolute requires all parties in possession of the real property TABLE OF CONTENTS 31 to deliver up possession to the lender, failing which they can be evicted by the Court Bailiff. Orders Absolute also have the effect under Section 28 of the BC Property Law Act3 of making all Judgments or covenants unenforceable. Orders Absolute are relatively rare as a result of the requirement to pay property purchase tax and their making Judgments unenforceable. Commencement b.an Affidavit supporting the facts in the Petition Lender’s Remedies after the Redemption Period Expires How Are a Mortgage Lender’s Rights Enforced? c.a certificate of pending litigation (a “CPL”) After the expiration of the redemption period, a lender has two choices: The Petition, Affidavits, and CPL are all filed at the appropriate Court registry and the CPL is immediately thereafter filed at the appropriate Land Title Office. a.it can apply for an Order for Conduct of Sale (allowing the lender to list the real property for sale with a Realtor), or A Foreclosure is the summary legal proceeding by which a lender enforces a mortgage in British Columbia. It is enforcement of the Covenant (by Judgment and execution) and enforcement of the Charge (by sale or foreclosure). Very simply stated, foreclosures usually proceed as set out below. 3 R.S.B.C. 1979, ch. 340 Schedule “A” Demand for Payment (demand period) Petition, Affidavit & Certificate of Pending Litigation Order for Substituted Service Personal Service Order Nisi & Judgment (redemption period) Order Absolute Order for Conduct of Sale (listing period) Order Approving Sale (execution on Judgment) 32 TABLE OF CONTENTS After default under a mortgage, and demand for payment, the following three documents necessary to commence a Foreclosure are created. a. a Petition Parties The Petition names as parties to the Foreclosure all parties liable on the Covenant and all subsequent chargeholders (for example, second mortgageholders, Judgment creditors, and builders’ lien claimants). Order Nisi After all the parties are served, the lender applies to Court for Order Nisi. This Order is, in many ways, the most important one made in a Foreclosure. There are four main components to an Order Nisi: a.a Declaration that the mortgage is in default and an Order setting the redemption period (the time during which, prima facie, the mortgage may be paid out); b.a Summary Accounting of the amount owing under the mortgage as of the date of the Order Nisi; c.Judgment against all parties liable on the Covenant, in the amount of the mortgage debt as of the date of the Order Nisi; d. Court tariff costs Redemption Period In normal circumstances the redemption period is set at 6 months. The redemption period can be shortened or eliminated4 if the lender can show some or all of the following: 4For an analysis of the principles governing shortening redemption periods, see for example CIBC Mortgage Corporation v. Burnham (1986) 2 B.C.L.R. (2d) 130 (B.C.S.C.) The Society of Notaries Public of British Columbia a.the net sale proceeds of the real property would clearly be less than the mortgage debt; b.abandonment of the real property; or c. consent of all parties. b.it can apply for Order Absolute (making the lender the owner of the real property). Approval of Sale After the real property has been listed for sale with a Realtor for a reasonable time and the lender has accepted an offer to purchase the real property, the lender can apply to the Court for an Order approving the proposed sale. Completion of Sale The party obtaining the Order approving a sale has the responsibility of completing the sale5 and the net sale proceeds are normally directed by the Order to be paid as follows: •taxes, utilities, strata charges, •real estate commission, •lender’s mortgage, •all subsequent chargeholders, in order of registration, •any balance to the borrower or into Court. s Andrew Bury is a partner in the Vancouver office of Gowling Lafleur Henderson LLP, one of Canada’s oldest and largest law firms. He attended UBC (BCom, JD) and the London School of Economics (LLM). His practice is largely restricted to loan security enforcement and related collection and insolvency matters. He is regarded as leading counsel in his field. 5Roadburg v. Cedarhurst, (1981), 21 B.C.L.R. 114, (B.C.C.A.) Volume 22 Number 3 Fall 2013 FEATURE: MORTGAGES Ron Usher Mortgage FRAUD Exposed! S How do I get the money…? mell a rat: To perceive some underhand work or treachery afoot; to detect something suspicious. The allusion is to a cat that smells a rat but cannot see it. Brewers Dictionary of Phrase and Fable: http://en.wikipedia.org/wiki/ Brewer’s_Dictionary_of_Phrase_and_ Fable In May 2008 I was asked to represent the vendor of a Vancouver home. The person claiming to be the vendor was an imposter, part of a criminal plan to carry out mortgage fraud. Fortunately, I smelled a rat. He signed the necessary documents before me and a Vancouver police officer posing as my student. Arrested as he left my office, earlier this year he was sentenced to 2 years in jail. Volume 22 Number 3 Fall 2013 It turned out that transaction was 1 of 6 carried out or attempted by the same gang around the same time. The imposter in my office was not the organizer of the frauds, just a necessary player. The gang had also recruited “straw buyers”—people set up to be the buyers and mortgage borrowers. The real homeowners had no knowledge of the schemes. The mortgage lenders had dealt with the straw buyers and had agreed to give them mortgages to fund the purchases. The crooks are after the mortgage proceeds, not the home. You can’t take the house to Costa Rica. Those transactions reflect one kind of mortgage fraud—fraud for profit. The gang members involved have no intention of occupying the properties. Those transactions are best described as bank robberies. The crooks are after the mortgage proceeds, not the home. You can’t take the house to Costa Rica. The funds flow from the lender, through the Notary or lawyer to the “buyer,” then ultimately to the imposter in the form of the proceeds of the sale. The imposter is typically paid a relatively small fee for his or her role and for turning the sale proceeds over to the organizing minds. The Scrivener The typically naïve straw buyer also gets paid for lending his or her name to the purchase documents and mortgage application. It does not end well for them; they quickly discover they have taken on actual responsibility for the mortgage loan. The crooks do not make mortgage payments so the loan quickly goes into default. That sort of fraud is quite rare in BC. •It requires considerable sophistication involving knowledge of mortgage-lending practices and conveyancing procedures. •Imposters and straw buyers need to be recruited and managed. •The transaction needs to be carried out under the scrutiny of the various professionals involved, in the hope no one will notice problems with the deal and that the true owner will not become aware of the plan. In my case, after discussing my suspicions about the deal with my partner, I looked up the phone number of the actual owner of the home. He quickly confirmed he was not selling the property. After discussions with the owner, Land Title officials, and the police, it was decided to proceed with the “sting” that resulted in the above arrest. Fortunately, our Torrens land title system here in BC provides TABLE OF CONTENTS 33 Once again, the straw buyer remains personally responsible for the loan. Though the registration of the mortgage is valid and the bank can foreclose, the value of the security for the loan can be seriously compromised due to the damage to the home. Sometimes the only “restoration” possible is a complete demolition of the residence. Pulling out the fake ID substantial protection for innocent property owners. In the above series of frauds carried out in 2008, some transactions did complete; title to the home was transferred to the straw buyer. The law is now clear in BC. (See the Ian Smith article in the Spring 2010 Scrivener.) The true owner of the property will have his or her title restored without the mortgage that was granted to the straw buyer. Though being a victim of this sort of crime is never a pleasant experience, our Torrens system and Land Title Act do put things right. In the 2008 transactions, the legal costs of restoring title were born by the Assurance Fund established under the Act. (See “Title Security in BC” on the LTSA website. http://www.ltsa.ca/cms/ title-security-in-bc) A more common variation on mortgage “fraud for profit” is where the fraudsters do intend to take possession of the property. In those cases, the main intention is to use the property itself as a base for criminal activity such as a drug labratory or grow-op. No imposter is needed but the organizing minds may again use a straw buyer to be the nominal owner and borrower that they coach through the mortgage-borrowing process. The true owner does get the sale proceeds and the straw buyer may get a relatively small fee. Once the deal has completed, the mortgage payments are typically paid until the grow-op is “busted” or the home is abandoned, usually with substantial damage. 34 TABLE OF CONTENTS The second and more common kind of mortgage fraud is often called “fraud for shelter.” The buyer/ borrower does want to purchase the property with the intention of using it as a residence or as an incomeproducing rental property. The fraud comes in the deliberate manipulation of the mortgage-lending process to obtain loans that would not otherwise be granted. We can, however, keep in mind the wisdom of two maxims: “Trust but verify” and “If it sounds too good to be true, it probably is.” Those matters range from a slight exaggeration of assets or income when completing a loan application form to complex creation of forged documents and the involvement of compromised professionals in the lending community. In any event, the intention is to get a loan in spite of lending guidelines and prudent business practices. They are more likely to be one-off transactions for the borrowers—though it is often the case that the loans they obtain have in common a willing “coach” in the lending industry who has gained a reputation as someone who can get “difficult” deals done. The new owners do usually have the intention of making payments as the property actually is being used for legitimate purposes. Problems arise, though, as the payments may be beyond the ability of the borrower to pay. The lender’s mortgages are enforceable but at the time of foreclosure, it can turn out that the The Society of Notaries Public of British Columbia Suspicious signatures… value of the property was exaggerated and a complete recovery of the money lent may not be possible. There is no perfect solution to the problem of mortgage fraud. We can, however, keep in mind the wisdom of two maxims: “Trust but verify” and “If it sounds too good to be true, it probably is.” For lenders, legal professionals, and everyone involved in real estatelending transactions, verification of information is critical. Unfortunately, in “hot” competitive lending and real estate markets, to obtain business it can be attractive to cut corners on normal due diligence. One mortgage lender used this slogan in advertisements, “Did you just read all these words? APPROVED!” Fortunately in 2013, everyone involved is much more diligent. Careful checking of information given against public records and credit bureau reports exposes many attempts to improperly obtain loans. Education programs and regulatory oversight of lenders, mortgage brokers, Realtors, and legal professionals have greatly improved standards in the mortgage industry. Very useful tools such as lending risk-analysis reports available through companies such as Landcor (www. landcor.com) alert lenders to potential frauds. It is increasingly common to use Internet searches (www.google. ca) to verify representations and to check properties. Free online GIS (Geographic Information Systems) can quickly give visual information on most properties. Is there really even a home on the Volume 22 Number 3 Fall 2013 property? (A massive fraud scheme in Alberta could have been avoided by simply looking online to see if the homes actually existed.) Specializing in the Purchase and Sale of Strata Properties For current property owners, it is important to be alert to any indication that an unauthorized transaction is taking or has taken place. For example, pay attention to any change in the delivery of mail to your home; fraudsters will often file change of address notifications with the Post Office so correspondence to the new “owner” does not go to the home. Strata • Condo • Apartment • Townhome • Duplex Thinking of buying or selling a Strata Property? Call today for a no-obligation consultation. www.vancouverstratainfo.com Member of Better Business Bureau Condominium Home Owners Association In many of the matters with which I am familiar, some unusual “odd” event gives a clue that something is afoot. If you have any concerns at all, check with your local Notary who can quickly do a title search to verify ownership. 604 760-7005 Crest Realty ©iStockphoto.com/ratch0013 Independently Owned and Operated And of course for anyone tempted by an offer of participation as a “straw buyer” or an imposter, it is important to remember that whatever is offered is too good to be true. The money paid will not begin to compensate for the civil and criminal legal sanctions that follow. s Ron Usher is the General Counsel for The Society of Notaries Public of BC. His career experience includes private practice in Vernon and Vancouver. He spent 8 years with the Law Society of BC and is a frequent presenter at seminars for CLE Continuing Legal Education seminars and seminars for other real estate industry professionals. Ron is also an SFU Adjunct Professor, teaching in the Master of Arts in Applied Legal Studies Notary education program. Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 35 BC notaries Marny Morin BC Notaries 2013 Fall Conference and AGM A nother successful Fall Conference was held at the gorgeous Delta Grand Hotel in Kelowna on September 21 and 22. Despite predictions, the weather was beautiful for the annual golf tournament. The guest program included a winery tour, and a cooking class led by Delta Chef Stuart Klassen. The Education program began with a keynote presentation by Dr. James Delgado—Director of Maritime Heritage, Office of National Marine Sanctuaries for the National Oceanic and Atmospheric Administration—who oversees programs, active research, and Dr. James outreach and education on America’s Delgado underwater and marine heritage. Administering NOAA’s Congressionally and court-directed oversight of RMS Titanic is among his duties. A past Executive Director of the Vancouver Maritime Museum and host of The Sea Hunters, James is the author of more than 30 books. Audra Bayer Kelowna lawyer Audra Bayer provided a comprehensive overview of the new Family Law Act. Senior family law associate and head of MacLean Law Group’s Kelowna office, Audra focuses on family law litigation and the resolution and mediation of high-conflict matters. Mark Smiciklas, Karen Cook, and James Spack provided informative sessions on social media topics including the business benefits of social media, building and maintaining a relevant website, and building business with the BC Notaries’ “Trusted Tips” newsletter for clients and community partners. The program finished with a discussion with Task Force Chair Bruce LeRose, QC, discussing the Interim Report to Benchers of the Legal Services Providers Task Force currently looking at ways to improve the provision of legal services in BC. Bruce is the Immediate Past President of the Law Society. Mark Smiciklas 36 Karen Cook TABLE OF CONTENTS James Spack Bruce LeRose George Tanco and John Eastwood with Wayne Braid looking on Honourary Life Membership “I George Tanco am delighted to announce that The Society of Notaries Public has awarded George Tanco an Honourary Life Membership,” said John Eastwood at the Conference. “A member of The Society for over 36 years, he was a Director for 24 years and President from 1994 to 1996. George also served as Chair of the Notary Foundation from 1996 to 1998. In 2004, he was given the Notary of the Year Award.” Says Wayne Braid, CEO and Secretary of The Society, “The contribution of George Tanco to the development of the Notary profession in British Columbia is immeasurable. George has mentored many Notary students and served as Acting Secretary for many years. George Tanco’s contribution cannot be overstated.” Honourary Life Membership in The Society is bestowed upon BC Notaries who have exemplified the spirit of The Society’s founding membership and distinguished themselves in the pursuit of improving and promoting the status of Notaries Public in our province. s The Society of Notaries Public of British Columbia Volume 22 Number 3 Fall 2013 http://www.stefanmatisphotography.com The Board of Directors of The Society of Notaries Public of BC 2013 – 2014 Seated (from L): Joan Letendre, John Eastwood (Immediate Past President), Tammy Morin Nakashima (1st Vice President), Akash Sablok (President), Linda Manning, Susan Tong, Patricia Wright Standing (from L): Daryl McLane, David Watts, Filip de Sagher, Jessie Vaid, Daniel Boisvert, Philip Kanigan, Lorne Mann Missing: Rhoda Witherly (2nd Vice President) Wild Bill Binfet and Nice Nick Aubin in “The T-Shirts”! Thank you, BC Notaries and Do Process! The 2013 Members of The Society’s 25-Year Club From Left:Maureen Friesen, Stephen Tidder, Judith Piccolo, Carolynne Maguire, Kim Vickers, Sudershan Gupta Missing (Inset): George William (Bill) Anderson, Jo-Anne Asher, Asha Lohia, Gail MacDonald Volume 22 Number 3 Fall 2013 The Scrivener At the Fall Conference President’s Gala, we raised $1800 for the Kelowna Community Food Bank . . . thanks to your generosity, Bill’s boisterous personality, my T-shirts, and the match donations from Do Process! Notary Nick Aubin, Member of the Board of the Kelowna Food Bank TABLE OF CONTENTS 37 BC Notaries, Their Guests, and Our Conference Sponsors Thank You! After 3 years, John Eastwood is stepping away as our President. I must thank him for his always-professional attitude and presentation style. He dedicates an enormous amount of time to our Society. Wayne presenting John with an authentic Talking Stick, carved by Heber Reece My thanks to John’s wife Bryanne and their extended family for their patience and understanding. I will miss John’s wise and thoughtful advice. Thankfully, he is staying on as our Immediate Past President and our representative on the Legal Service Bryanne Eastwood Providers Task Force. John presenting Susan with an Inuksuk This year we say a fond farewell to Susan Davis who has also served on the Board of The Society for many years and as our President, Past President, and Chair of the Notary Foundation. I am sure you join me in thanking Susan for her years of service and in wishing her all the best in her future endeavours. Wayne Braid, CEO 38 TABLE OF CONTENTS The Society of Notaries Public of British Columbia Volume 22 Number 3 Fall 2013 Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 39 Judi Whyte RI Robbi-Layne Robertson Inaugural Professional Excellence Award Real Estate Board of Greater Vancouver Cell: 604.868.9812 [email protected] Cell: 604.351.9417 [email protected] Selling Homes for over 30 years ~ www.JudiWhyte.com Call us for real estate advice and service you can trust. Prudential Sussex Realty 2397 Marine Drive, West Vancouver, BC V7V 1K9 E S TAT E S • TA X AT I O N • T R U S T S • ACCO U N T I N G Many of my clients are Executors, Notaries, and Lawyers who come to me from all over BC and Canada. I help my clients understand and navigate through the complexities surrounding death and taxes. I provide essential expertise required to minimize income taxes and expedite final distributions. Heather MacLean, CPA, CGA Our firm provides advice on and preparation of: Estate Manager • • • • • Phone: 604-524-8688 Email: [email protected] Web: www.mti-cga.com Unfiled prior tax returns and adjustments Date of Death T1 (Terminal T1) and optional tax returns Estate T3 tax returns to final distribution Tax Clearance Certificates Estate accounting #350 – 522 Seventh Street, New Westminster, BC V3M 5T5 40 TABLE OF CONTENTS The Society of Notaries Public of British Columbia Volume 22 Number 3 Fall 2013 Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 41 BC notaries: EDUCATION Todd McKendrick MA ALS 603, Philosophy of Law: Examining and Applying Legal Thought T o many, the course appears a departure from the very practical curriculum of the Masters in Applied Legal Studies program (MA ALS). When you understand the course exposes students to the reasoning process of some of the world’s great thinkers, it becomes clearer why this class is considered an important feature of this degree. Delivered online through Simon Fraser University’s award-winning distance education format, course ALS 603 features weekly seminars presented by students. hear them. I am always impressed with how students in the course find their way into the discussions and how much progress they make in approaching these classes in an increasingly methodical way. The readings are not easy for those new to philosophy. Actually, they’re probably not easy for anyone. It’s the method that makes 603 a crucial part of the MA ALS experience. The course shows how a reasoned and methodical approach to a problem can make what may have seemed too big to grasp, quite manageable in the end. The readings are not easy for those new to philosophy. Actually, they’re probably not easy for anyone. Excerpts of writings from Aristotle, Cicero, Hobbes, Bentham, Locke, Rousseau, Fuller, Hart, Holmes, and Dworkin, among others, are discussed in turn as students get acquainted with the major schools of legal thought. Working on the problem together, sharing points of view, and hearing the approaches of other students are hallmarks of the course. While students are graded on two papers and a written exam, participation is an essential part of their final mark. The size of these concepts can be a little daunting when you first •In the first of the seminars, a student leads the class in discussing aspects of the week’s readings. Topics run the gamut of issues that have caught the imagination of philosophers, lawmakers, lawyers, and judges since laws were organized—What is a law? Is a law different from a rule? Do we need laws? What makes us obey laws? Do laws have to be just, or fair? How do we interpret laws and who decides what a law means? 42 TABLE OF CONTENTS ©iStockphoto.com/HultonArchive •In the second, another student takes his or her classmates through an exploration of how the issues in the readings continue to pop up in society. 350 BC, Greek philosopher Plato Aristocles (427 – 347 BC) with the philosopher and scientist Aristotle (384 – 322 BC) The Society of Notaries Public of British Columbia The hope is that the topics themselves are of interest to the students and they will remember some of the historic figures whose writings they read. The truly practical element of the course—its focus—is the ability to understand how a reasoned argument works. By the end of 603, I am always gratified to see students’ willingness and ability to face a new problem and begin dealing with it in an organized way. I am grateful to those students I’ve been able to teach thus far in the program. I’m sure I learn as much as they do each year and I look forward to teaching the next cohort starting in January 2014. s Volume 22 Number 3 Fall 2013 BC notaries: EDUCATION Cam Sherk The Joy of Learning I was a member of one of the first cohorts to go through the Masters of Arts in Applied Legal Studies (MA ALS) program administered by the Notary Society in conjunction with Simon Fraser University. Becoming a BC Notary was both interesting and exciting. I was lucky to take the MA ALS program at SFU just when the way BC Notaries are educated changed dramatically. Not only were we students taught the things a Notary are expected to know, like Real Property and Wills, we were educated in wider and sometimes more abstract subjects such as the Philosophy of Law. Todd McKendrick was our professor in that course. For Applied Legal Studies course 630, also known as the capstone course, Todd taught in conjunction with Dave Bilinsky. Todd’s courses had a somewhat different bent from the more traditional courses in the MA ALS program. As the name implies, the philosophy of law deals more with the philosophical basis of the law as opposed to concrete statutes. Although the other courses were challenging and relevant and required abstract thought, there is a significant difference between interpreting the Strata Property Act and deciphering H. L. A. Hart’s argument about the nature of Legal Positivism. Volume 22 Number 3 Fall 2013 KABAN PROTECTIVE Your Security and Protective Specialists Todd offered lots of practical advice. His role in the Philosophy of Law course was geared toward teaching us how to interpret what we were reading to ensure we did not go completely off the rails in our research. The method of instruction was not so much about telling us what A, B, and C are and asking us to remember it; he taught us how to interpret and analyze the data and information so we could come to our own conclusions about A, B, and C. That essential skill set has served me very well thus far. …there is a significant difference between interpreting the Strata Property Act and deciphering H. L. A. Hart’s argument about the nature of Legal Positivism. Applied Legal Studies course 630, delivered through our Internet meeting system “e-live,” focused on matters such as how we would use technology in our future practices and keep current with Notary Society governance and regulation. It also required that we write a thesis on an issue we felt was important to us as individuals and to the Notary profession in general. It was up to us to find and research a topic; there was no “right” answer for the project because the conclusions reached were based on our own research. s [email protected] The Scrivener • CRIMINAL & CIVIL INVESTIGATION • DUE DILIGENCE • CORPORATE INTELLIGENCE Tel.: 604 251-2121 Fax: 604 251-2323 Toll Free: 1-866-451-2121 [email protected] www.kabanprotective.com Associates in 63 Countries Margot R. Rutherford* Notary Public A Member of The Society of Notaries Public of British Columbia *Denotes Professional Notarial Corporation 981 Fitzgerald Avenue Courtenay, BC V9N 2R6 Tel: 250 338-6251 Fax: 250 338-5337 email: [email protected] TABLE OF CONTENTS 43 BC notaries The Examiners for BC Notary Students D. Peter Ramsay, QC The three Examiners are appointed by BC’s Attorney General from names put forward by The Society of Notaries Public of BC. The appointment process takes about a year. P eter Ramsay was called to the British Columbia Bar in 1970. He practises in Nanaimo as the senior partner in the 21-lawyer firm Ramsay Lampman Rhodes. A Certified Family Mediator since 1985, Peter earned his Master of Laws degree (LLM) in 1997 and was appointed Queen’s Counsel in 1999. The subject of his Master's thesis was the Wills Variation Act. Peter taught Real Property, Wills and Estates, and Trust law at the UBC Law School faculty for 8 years and now teaches Personal Planning in the Simon Fraser University Master of Arts in Applied Legal Studies program (MA ALS). He chaired the British Columbia Law Institute Succession Law Reform Project and Supreme Court Probate Rules Project that allowed for the proclamation of the new Wills, Estates and Succession Act that will be law in BC in March 2014. The Scrivener: Please tell us about your work with the law. Peter: My legal practice has been varied. In the 1970s, I had a very active court practice in collections, foreclosures, and family law. I have acted as counsel 44 TABLE OF CONTENTS for the Attorney General of British Columbia and the Minister of Justice for Canada in criminal prosecutions in Provincial, County, and Supreme Courts. I have defended clients in criminal matters in those courts and conducted civil trials and appeals to as high as the Supreme Court of Canada. I have also appeared before administrative tribunals and arbitration Boards. Over the years, I have also had a general solicitor’s practice in commercial matters, municipal law, and employment law. I began work in the Wills and Estates area in the mid-1970s and have litigated extensively on estaterelated matters. As a Board member, chair, and panelist with the Continuing Legal Education Society of BC, I have been involved in the education of lawyers for more than 30 years. As a Law Society Bencher and Law Society Special Compensation Fund committee member, I have extensive experience in conducting hearings and adjudicating claims, most recently the Martin Wirick fraud claims that totalled more than $40,000,000. As a Board member, chair, and panelist with the Continuing Legal The Society of Notaries Public of British Columbia Education Society of BC, I have been involved in the education of lawyers for more than 30 years. The Scrivener: Please tell us about your connection to The Society of Notaries Public of BC. Peter: While I was teaching at UBC Law School, Professor Bob Reid— who has had a long association with The Society—was a colleague. With his support and encouragement, I began teaching Property Law to students in the BC Notary training program, which led to my current teaching of the Personal Planning course at SFU. The Scrivener: What happens after the Notary students graduate with an MA ALS degree? Peter: They take 6 weeks of practical training—lectures, in-office Notary mentoring, written and oral assignments, and research on the practical aspects of a Notary practice, including real estate conveyancing, trust accounting, Wills drafting, the notarization of documents, and more. The Scrivener: You are 1 of the 3 examiners appointed by BC’s Attorney General to test the students’ knowledge before they can become BC Notaries. Peter: Yes, I am. The examiners design, administer, and mark the statutory examinations the BC Notary students must write at the end of their studies. Volume 22 Number 3 Fall 2013 The Scrivener: How long have you been an examiner? Peter: Since 2012. I like the challenge of setting examinations that will help ensure the students meet the education requirements necessary to become BC Notaries and to provide quality services to clients. The Scrivener: Please tell us about the exams. Peter: The Act and Regulations require the examiners to set a total of six 2-hour examinations for the students to write over 3 days. The three examiners have by agreement taken responsibility each year for 2 of the 6 examinations. So far I have set the examinations for Contracts and for Wills and Trusts. In deciding what questions should be asked, I consider all the course materials and the subject areas in which BC Notaries deliver services. From the materials, I select the concepts I think students are most likely to encounter in their future Notary practices. The challenge is to develop questions that will test a student’s ability to recognize a legal issue, explain the issue in a way that shows he or she understands the issue, and apply that understanding to a fact pattern. One result of this process has been a broadening of the topics on which the students are examined. For example, questions on Powers of Attorney, Representation Agreements, and Advance Directives may be asked. The Scrivener: How would you assess the overall education program of the BC Notaries and the Notary students in it? Peter: I think the program is well structured. There are ongoing efforts to improve the program to reflect new developments in the law, the practice of BC Notaries, and our experience in delivering the program. Because of the trust clients have in Notaries, it is very important to maintain high standards and ensure that students meet those standards. s Your client can create a lasting legacy of love for all of BC’s children When your client includes BC Children’s Hospital Foundation in their Will, they could be saving the life of a child 20 years or more from now. Small Patients Great Needs For more information please contact Diane Haarstad at 1-888-663-3033 or [email protected]. www.bcchf.ca Providing Exceptional Property Management Services for almost 50 years • • • • Residential Rental Properties Condominium Properties Commercial Properties Resort Properties To contact our offices, visit www.gatewaypm.com. Our Head Office: 604 635-5000 [email protected] Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 45 BC notaries Meet the Board of Directors Travelling Mann: Lorne Mann in Creston T he eldest of five, I was born in the Kootenays into a lineage of some of the original settlers in the Creston Valley and Yahk area, in the southeast area of British Columbia close to the United States border. My mother was a Huscroft, a large family group that came to Canada in 1891 after being forced to leave Utah. They were unaware they had crossed the border into Canada. Once settled, the Huscroft family became farmers and loggers. One member of the family still owns and operates a sawmill in the area. My father’s family came from Slovakia and settled in the Yahk area in the 1920s; they were loggers. My father started his young married life as a logger, working around the Kootenays. After a tragic accident on Kootenay Lake where a boat of his workmates capsized, he quit logging and went to work for Cominco in Trail. My parents decided to move back to Creston where my father worked with my grandfather selling insurance for Fruit Growers Mutual. I attended elementary and secondary school in the Creston area. I left Creston after high school and by referral from a family member came to be a computer 46 TABLE OF CONTENTS All photos courtesy ldm operator/programmer. In the early 1980s, I attended the Southern Alberta Institute of Technology and University of Calgary. The first computer I operated was a Univac 6130 with 32K of memory! The computer room occupied an entire floor of a downtown office tower and had less computing power collectively than one of the small computers we use today. My biggest financial loss was not believing in a young guy named Bill Gates because, in my mind, a bigger computer was better! I didn’t buy into Microsoft. Oh, well. My biggest financial loss was not believing in a young guy named Bill Gates… When the Alberta economy collapsed due to high interest rates in the mid-1980s, I came back to Creston. I recall my car loan interest rate was 25 percent—almost unbearable. Thankfully, my family took me back, sent me to college in Cranbook for my business diploma, and employed me in the family insurance business. I met my wife Marianne at that time and was considering buying into the business. The local credit union had different ideas and bought out the insurance agency. Soon I was unemployed due to management issues and my friend and local Notary The Society of Notaries Public of British Columbia (and mentor) Ron Evans said he was wanting to do something else and convinced me to go back to the books. I was commissioned as a BC Notary in 1989 and have enjoyed my 2+ decades serving the people of Creston and Kootenay Lake. The new manager of the local credit union is my friend, mentor, and provider of mortgage business for my office, so I believe the experience was meant to be. I enjoy an excellent relationship with the other Notaries and lawyers in the Kootenays. For many years I had the privilege of working with Louise Currier, now a Notary in Grand Forks. Creston employs loggers and brewers (Kokanee beer). It has orchards, vineyards, mixed farming, tourism, long-term care, and medical and related support industries. I work with all those industries. Many retirees settle in the valley because of the temperate climate so estate planning is a significant part of my Notary practice. Creston, home of Kokanee and the Sasquatch! Volume 22 Number 3 Fall 2013 My wife and I have two grown children who live in Alberta. My daughter Laura recently graduated from McGill University in Montreal and is employed as an accountant for Deloitte in Calgary. She is completing her Chartered Accountant designation. My son Joel is attending the University of Alberta in Edmonton, studying to be a psychologist. My wife is a teacher who was actively involved in our Notary business for many years. She is also a mentor and my best friend. I have appreciated her willingness to use her high school teaching skills to raise our children and be a billet parent for many years to the local Junior B hockey team, the Creston Valley Thunder Cats. Creston has a large recreation centre with indoor pool and hockey and curling, as well as exercise facilities. The Creston Valley Wildlife Centre (Ramsar-accredited and now Ducks Unlimited) is a multithousand-acre wildlife sanctuary. The Creston area is part of the migration route for the birds. Last, but most important to me, are the hiking, fishing, and hunting. The scenery constantly brings a smile to my face. The family dog Vanilla enjoys her daily walks looking for another area to explore. I always enjoy this beautiful part of the world… Vanilla, my confidante My trip this year was to the area of the mountains. I went north with two of my neighbours to the Duncan Lake area. I always enjoy this beautiful part of the world, especially the areas without power lines and cell service! Duncan Lake Backcountry Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 47 Ron Schatschneider, Notary from Cranbrook I am travelling more as time permits. In 2011, Cranbrook Notary Ron Schatschneider invited me on a guided trip to the Middle East. We visited Egypt shortly after the uprising, then Jordan and Israel. I now have a hunger for world history and hope to go to other countries to study their cultures. Ron has lots of ideas so I will just tag along! I now have a hunger for world history and hope to go to other countries to study their cultures. with the Tradition of Trust. I enjoy all aspects of being a Notary and am happy to be able to practise in the fields of conveyancing, Wills, estates, Powers of Attorney, Representation Agreements, and subdivisions. Lisa, Penny, and Joanne Middle East travels: (Upper right) a temple in Egypt; (Above) Jerusalem Entering my second year of service as a member of the Board of Directors of the BC Notary Society, I have a strong appreciation of the efforts required to keep The Society running smoothly. I have great admiration for our President John Eastwood, my fellow Board and committee members, and our CEO Wayne Braid. I had no intention of being a Board member, due to the distance 48 TABLE OF CONTENTS involved to attend meetings, but Wayne—looking ahead to reduce travel costs—installed a video system that allows me to attend most of the committee meetings by live video link. The Society has a well-rounded Board representing all areas of the province. Although being a BC Notary includes long hours, it is rewarding to know you have helped fulfill your clients’ legal needs. I want to continue The Society of Notaries Public of British Columbia And I have the best assistants— Lisa, Penny, and Joanne! I am also a Board member on Kootenay Employment Services in Creston. I believe it is important for employers and employees to promote their services to each other and their communities. The most important aspects of my life are my Christian faith, my wife Marianne, children Laura and Joel, my parents, and our extended family, friends, neighbours, and my Notary practice. I am blessed! s [email protected] Volume 22 Number 3 Fall 2013 $41,647,534 30 MILLION Building Better Communities, One Grant at a Time Susan Davis Ken Sherk John Eastwood Susan Davis, Chair Ken Sherk John Eastwood Akash Sablok Rhoda Witherly Akash Sablok 6 MILLION Rhoda Witherly As at June 30, 2013 Volume 22 Number 3 Fall 2013 David Moore Tammy Morin Nakashima David Moore Leta Best Lisa Nakamura Filip de Sagher Leta Best G. W. (Wayne) Braid, Executive Officer of the Notary Foundation, is responsible for the administration of the office and staff, and the diverse investment funds of the Foundation. 12 MILLION Funds earned to date from BC Notaries’ Trust Accounts. Tammy Morin Nakashima The Current Governors 24 MILLION 18 MILLION The Board of Governors of the Notary Foundation of BC is comprised of •8 members of the Board of Directors of The Society of Notaries Public of BC; •1 representative from the Attorney General’s office in Victoria; •2 Directors-at-Large, appointed by the Attorney General; and • the Executive Officer. The members from The Society are elected by the Directors of The Society from among their ranks, for a 3-year period. Wayne Braid The Board of Governors meets quarterly to consider applications for funding from various organizations and to set policy, review the Foundation’s financial status, and provide direction for the administration of the Foundation. The Governors of the Foundation have the responsibility of guiding the Foundation in its mandate to disperse the funds generated by interest on BC Notaries’ Trust Accounts. Lisa Nakamura Filip de Sagher The Notary Foundation funds are used for the following purposes. 1. Legal education 2. Legal research 3. Legal aid 4.Education and Continuing Education for BC Notaries and applicants who have enrolled to become BC Notaries 5. Establishment, operation, and maintainance of law libraries in BC 6.Contributions to the Special Fund established under the Notaries Act of BC The Scrivener TABLE OF CONTENTS 49 Jane Dyson Building Better Communities, One Grant at a Time Spotlight on Good Works BC Notary Foundation and BC Coalition of People with Disabilities A good friend to BCCPD over the years, the BC Notary Foundation has provided us with the funding needed to complete a number of important legal education projects for the disability community. For example, in 2008 the Foundation’s support enabled us to increase awareness about Representation Agreements and Adult Guardianship legislation. Another grant from the Foundation meant we were able to update our Canada Pension Plan Disability guides and have them translated into Chinese and Punjabi. Each year we assist hundreds of people with disabilities living on low incomes to access provincial and federal disability benefits, mobility aids, special diet allowances, dental services, and subsidized housing. Many of the people we assist are homeless or at risk of being homeless. We produce an extensive range of self-help guides and community advocates manuals and write briefing notes 50 TABLE OF CONTENTS on issues of importance to the disability community, particularly with respect to legislative change. We operate an HIV and Wellness program and an emergency preparedness program. We publish Transition, a quarterly magazine that is a unique community-based resource for people with disabilities, their families, caregivers, community organizations, health care professionals, policymakers, and the general public. The publication is a forum for accessible information about programs, research, and issues impacting people with disabilities. Thanks to the generous support of the BC Notary Foundation, our Fall 2013 Transition is a special legalresource issue—“People with Disabilities and the Law.” This resource will help people with disabilities and their networks have a better understanding of how the law can support them and of the legal safeguards and supports available. We’re excited about the issue. Thanks to the Notary Foundation, it will be an important legal resource for the disability community. The Society of Notaries Public of British Columbia Volume 22 Number 3 Fall 2013 •How have people with disabilities used the law to advance their rights? We examine the 2012 Supreme Court of Canada Moore decision that found North Vancouver School District discriminated against Jeff Moore, a student with dyslexia who was denied educational supports. Moore’s lawyer Frances Kelly will write about this groundbreaking case. •What does the UN Convention on the Rights of People with Disabilities (CRPD) mean for the disability community? Vangelis Nikias, who represented Canada during the CRPD negotiations, provides his expert analysis. We will also provide detailed information about the important services BC’s Notaries provide for people with disabilities and review BC’s duty to accommodate rules. George E.H. Cadman, Q.C.* 604 647 4123 | [email protected] With over 30 years’ experience, George makes the complex simple to resolve your real estate or corporate disputes. *Member of the Notaries Public Board of Examiners Uniquely West Coast™ We Value Canada BCCPD’s Board, staff, and volunteers are sincerely grateful to the BC Notary Foundation for its support and to the BC Notaries for the important services they provide to our community. Jane Dyson, MA, is Executive Director of the BC Coalition of People with Disabilities (BCCPD). Responsible for the management of projects and community initiatives designed to enable people with disabilities to live with dignity and independence in their communities, she played a leadership role in founding the Disability Without Poverty Network and works closely with key stakeholders in the custom transit field. On the Board of the Nidus Personal Planning Resource Centre and Registry, Jane is a member of the Vancouver Foundation’s Disability Supports for Employment Advisory Committee and the Regional Steering Committee on Homelessness. [email protected] www.bccpd.bc.ca Volume 22 Number 3 Fall 2013 Canada’s most authoritative voice in real property valuation! When the market’s changing, whom can you trust? Call the experts: AIC professionals. We’re Canada’s leading authority in real property valuation. Designated AIC members can help you make smarter choices with in-depth analysis, market insights and practical solutions. • Acquisition • Management • Development • Portfolio Diversification • Disposal • Feasibility Studies • Depreciation Reports #210 – 10451 Shellbridge Way Richmond, BC V6X 2W8 Phone: 604 284-5515 Fax: 604 284-5514 [email protected] www.appraisal.bc.ca Look for members who hold the AACI, P.App, or CRA designation. The Scrivener TABLE OF CONTENTS 51 The MiX LAND Nigel Atkin When Space is Limited, Think Bigger T here’s no doubt there’s a growing land squeeze in British Columbia’s Lower Mainland. Traffic congestion, decline in air quality, and the need to constantly improve transportation infrastructure are some of the indicators. Lack of land is another. Residential development pressures are impacting industrial lands. Both, in turn, are impacting agricultural land and the surrounding natural habitat. Extreme residential density might be one market option. Surrey has Canada’s smallest residential strata studios. The show homes, which measure some 300 square feet including a tiny balcony, are offered for under $120,000. Parking is another $12,000. Across the Lower Mainland, the industrial land base is very expensive and getting more so. A recent study by site location consultant Boyd Co., based in Princeton, New Jersey, reported that operating a 500,000-squarefoot distribution centre in Vancouver cost $23.6 million a year—the most expensive among 29 cities in the study. Property and sales tax costs were also notably high in Vancouver. 52 TABLE OF CONTENTS With increasing international trade, the Lower Mainland ports need to expand. Residential properties in close proximity to ports and using the same urban highways are facing increased rail and truck traffic, safety issues, noise, and pollution. There are concerns that agricultural land will be converted to industrial land to drive economic growth. And, as Delta continues to develop as a corridor for transportation, the increasing traffic congestion to serve expanding port development will possibly deplete vital wetlands and many of the geographic attributes that residents enjoy. …the industrial land base is very expensive and getting more so…With increasing international trade, the Lower Mainland ports need to expand. As municipalities attempt to manage the complexity of growth, many other predictable pressures are looming. Mayors, councils, their consultants, and administrators, as well as many citizens and civil society organizations, are studying the best and least-worst options facing their communities. The Society of Notaries Public of British Columbia Residential, Industrial, Agricultural, or Wetlands? Whether large swaths of land are kept industrial or converted to residential use or whether the Agricultural Land Reserve is strengthened or further erodes, concerns about access, transportation, services, infrastructure, and the environment—as well as any further residential, industrial, or port development—will have a massive impact on the entire region. Seattle faces many similar problems. Competitiveness on the global stage confronts them, the need to update infrastructure, the rising costs of trucking, and increased rail traffic in residential areas mirror Vancouver’s situation. Recent mudslides between Seattle and Everett brought home the economic hindrance of crumbling, outdated railroads—needed more than ever to haul freight to and from ports. Global Trends in Shipping The pressures on the Lower Mainland and Seattle are only just starting. Stay tuned. The world’s largest ocean shipping company, Maersk Line, is buying 20 of the largest-ever container ships—Triple E vessels, each capable of carrying 18,000 20-foot containers—2500 more containers than their largest ships now carry. Volume 22 Number 3 Fall 2013 The Third Set of Locks Project is expanding the Panama Canal, effectively doubling shipping capacity by 2015. That will allow more and much larger ships to transit between the Atlantic and Pacific Oceans. The new locks are set for testing in February 2014. To prepare for those eventualities, many ports are considering renovations including dredging, blasting, and bridge elevation. The Port of Liverpool is today undergoing significant expansion to take what are known as “postPanamax” vessels. On the east coast of the United States, New York City and Baltimore have already increased the depth of their terminal harbours to 15 metres and Miami is doing the same in a “deep dredge” project. The Port Authority of New York and New Jersey has launched a $1 billion rebuilding project to raise the roadbed within the existing arch to allow the larger container ships to pass underneath. With Germany, India, China, Malaysia, and Brazil gaining economic strength, British Columbia and Canada can expect increased prosperity, despite recent setbacks. Necessary trade is growing. Markets and ports need to be ready. of strategic significance to Canada’s trade. Their effective operation contributes to Canada’s global competitiveness as a trading nation.” The Port Alberni Port Authority is mandated jurisdiction of the Alberni Inlet from the Somass River—near the city centre—to Tzartus Island—the large island near the mouth of the long inlet many miles south-west from Port Alberni’s city centre itself. The inlet •is prone to calm waters, •is free from any navigational obstacles, •is ice-free year round, and •offers a direct shipping route to the Pacific Rim and beyond. It is Canada’s, British Columbia’s, and the Lower Mainland’s closest major port to China, the New Panama Canal, India, Malaysia, and all other ports. If the Northwest Passage becomes seasonally ice-free as climate change indicates, Europe becomes closer. Today, the Port is relatively dormant and underutilized. Necessary trade is growing. Markets and ports need to be ready. Thinking Bigger in British Columbia BRITISH COLUMBIA Take a moment to look at a map that includes the Salish Sea, the Straits of Juan de Fuca and Georgia, Puget Sound, the Cities of Vancouver and Seattle, Victoria, Tacoma, the Sea’s watershed, and all the Lower Mainland and Southern Vancouver Island. You will note that the mouth of the Port Alberni Inlet on the West Coast of Vancouver Island is only 35 miles by sea away from entrance of the Straight of Juan de Fuca where ALL the container shipping must now go to serve those markets. VANCOUVER ISLAND Large container ships now go directly to Vancouver, Seattle, and Tacoma and are then unloaded and the containers further transported by rail or truck to other final destinations. As noted, that is causing backlog issues with truck and rail transportation congestion on highways and is incurring added costs. One of the big costs is large container shipping directly to the Mainland ports themselves. Mouth of the Port Alberni Inlet S Port Alberni t r a i t o fG eo rgi a The Salish Sea Vancouver/ Lower Mainland Victoria Stra it of Juan de F Puget u c a Sound Port Alberni Port Authority Seattle According to Transport Canada website, “The Port Alberni Port Authority is the Canada Port Authority (CPA) established to manage the port of Port Alberni under the Canada Marine Act… Tacoma WASHINGTON “Eighteen CPAs now make up Canada’s national port system. The CPAs are non-share capital corporations incorporated under the Canada Marine Act and are Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 53 The Proposal: Trans Shipment and Short Sea Shipping WESA and Probate Rules Courses The recently proposed Port Alberni Port Authority Container Trans Shipment and Short Sea Shipping Terminal would allow large ships to offload containers to be reshipped by barges or more versatile ships, directly to many smaller terminals in the Vancouver and Seattle areas— even to other ports such as Portland in Oregon. There are many benefits to this proposal. •Barges can reach distribution points further up rivers and to smaller ports, reducing on-land traffic congestion and its impact on road infrastructure, road safety, and pollution. •Many of the urban density issues—the growing conflict among residential, industry, agriculture, and nature—can be mitigated. •The environmental benefits to communities in and around the Salish Sea and surrounding ports and urban centres might be considerable. •The savings in time and to the increasing open-sea shipping costs and in road and rail congestion are expected to be significant. •Sailing time for large container ships can be reduced by 1.5 days to Vancouver and 1 day to Seattle. •Alberni Inlet is naturally deep, well protected, and 1.2 kilometres wide (wider than Vancouver Harbour); •The proposed location is currently an uninhabited remote location with little or no other use than forestry. As well, with growing urban centres on Vancouver Island—current population 740,000, projected to be approaching 1 million by 2030— Port Alberni’s new terminal can, with infrastructure upgrades, expedite rail or truck transport directly to markets in Campbell River, Courtenay, Nanaimo, and Victoria. 54 TABLE OF CONTENTS The Society of Notaries Public of British Columbia There will be no need to ship products to Vancouver, then reship them to the Island—again saving time and money. Change doesn’t come quickly, but the Port Alberni Port Authority is moving forward with an economic feasibility study. As well, 750 hectares of land near Barkley Sound has been set aside between Spencer Creek and Coleman Creek. There is local support and early interest from international investors. As well, with growing urban centres on Vancouver Island—current population 740,000, projected to be approaching 1 million by 2030—Port Alberni’s new terminal can…expedite rail, or truck transport directly to markets in Campbell River, Courtenay, Nanaimo, and Victoria. Trans shipment and short sea shipping is widely practised in many ports around the world for business, environmental, and lifestyle efficiencies. Consider Singapore and Hong Kong, for example. With the advent of advanced modes of transportation, greater access to natural resources, and everincreasing consumer trade, evolving our societies into future systems is the challenge. For all the pros and cons, the reality of global change and the Lower Mainland’s economic and environmental sustainability demands that we think bigger and move forward. s Nigel Atkin, MA, is an international development consultant and university instructor specializing in strategy, communications, and ethics. He teaches the Evolution of Public Relations in the University of Victoria’s Diploma Program in Public Relations and currently resides in Port Alberni. [email protected] Volume 22 Number 3 Fall 2013 Help grow . . . The Elders and Youth Tribal Governance Fund . . . by Building a Legacy T he navigation of communities relies on both the wisdom of Elders and the energy of youth. Tribal governance requires the resources of both young and old. Sometimes your financial support is needed to help guide local decision-making to support traditional Aboriginal culture in the contemporary world. Administered by The Victoria Foundation since 2008, The Elders and Youth Tribal Governance Fund provides small community grants to promote and preserve cultural practices in four areas. Services for the Elderly e.g., Ability to Attend the Annual Elders Gathering Traditional Sports Canoe Racing, Lacrosse, Soccer, and Baseball Arts and Crafts Traditional Carving, Knitting, and Weaving Teaching of First Nations Governance Stories, Events, Dances, Drumming, and Song If this is one of the causes people you know care about, please call Sara Neely at 250.381.5532 or email [email protected]. * Brought to you by Nigel Atkin, Founder of the Elders and Youth Tribal Governance Fund www.victoriafoundation.bc.ca www.victoriafoundation.bc.ca ORIGINAL RECIPES Marco Castro L ife is short. We should enjoy every moment so let’s eat meals that are healthy and delicious at the same time! Like many other countries around the world, Brazil has a strong food culture. Almost every area has its own cuisine. If you’ve already been to Brazil or have read about the food, you will be familiar with some of the items I mention—or maybe you can plan to go to Brazil next year for the Soccer World Cup! Banana purée dessert with flaxseed-fibre wheat germ Lunch A typical lunch in Brazil involves beans, rice, and protein. Sometimes a salad and/or french fries may be included but don’t even try to remove the beans and rice! By far the most famous Brazilian dish is feijoada, which features feijão (beans) as the main element. Black beans are typically used for feijoadas but in my healthier version, black beans get changed to Azuki beans. For an aperitif, try pomegranate or açaí juice with hydrated chia seeds. Açaí comes from the Amazon region and is very rich in iron. Chia was largely cultivated and consumed by the Aztecs and Mayans; it is a very good source of Omega-3. Feijoada: Azuki, rice, broccoli, farofa, and veggies TABLE OF CONTENTS Although I don’t eat meat, a traditional feijoada contains a variety of meat cuts and items such as panseared shredded collard or kale, sliced oranges, and farofa made from toasted manioc flour. Impoverished people in the North and Northeast regions of Brazil eat raw manioc flour, black beans, and rice as their main meal. For many, that is the only food they eat each day. One famous spicy dish from the state of Bahia is caruru, made with okra. I eat okra with beans and I add it to my soups; it adds superb taste. Not well known in North America, okra can be found at larger grocery retailers and Chinese food markets. Aperitif 56 Azuki beans are an excellent source of many minerals. You prepare them as you do any other beans. Some specialty grocery stores carry them. If you are intrigued, try them! More Suggestions You’ll be amazed at the benefits of these ingredients. Salad with pomegranate and chia All photo credits: Marco Castro Healthy Meal Tips from Brazilian Cuisine Ever since I was introduced to Azuki beans and learned about their terrific nutritional benefits, I have been adding it to my daily menu. This small bean was first used in Japan in approximately 4000 BC and is currently part of the diet in Japan, China, Korea, Vietnam, the Himalaya regions, and other Asian countries. The Society of Notaries Public of British Columbia A key ingredient in my menu is quinoa. This whole grain is grown at approximately 12,000 feet elevation and is very rich in nutrients. Quinoa was largely consumed by ancient civilizations and is usually eaten with salads, vegetables, or as part of hot dishes. You cook it like rice. Here’s a fast recipe that can be put together within 30 minutes. Cook basmati brown rice with a very small portion of wild rice, then add broccoli and cook until the broccoli is al dente. Wonderful! Volume 22 Number 3 Fall 2013 That reality can be changed—one spoonful at a time. TAMMY MORIN NAKASHIMA Notary Public Phone: 604 275-0070 Fax: 604 275-0080 Email: [email protected] Salad To organic field greens, I add organic flaxseed oil and hemp hearts from Manitoba, sliced tomatoes, and small cubes of cantaloupe and avocado. Sometimes I add quinoa, too. To finish it all up, I sprinkle on some toasted sesame seeds and sliced almonds. So delicious! Real Estate Matters – Mortgages – Wills Powers of Attorney – Representation Agreements #209 – 3740 Chatham Street Richmond BC V7E 2Z3 Fruits, Vegetables, and Nuts We never met, but you saved my life. •Myriad vegetables and even fruits go very well on the BBQ. Tofu, asparagus, and pineapple are some of my favourites. •Walnuts are also fantastic. Eat them as a snack and add them to salads and many other dishes. •I frequently eat shredded raw ginger with my main meals to add a natural, spicy taste. You lifted me out of 40 years of addiction and gave me a second life. Today, I honour your legacy through my actions. I am now sober and happily married. I became a man who loves God, a published poet, and once again, a father to my daughters. Fibre For me, milled flaxseed and natural wheat fibre have a place—usually in desserts! I purée a banana on the plate and put milled flaxseed and wheat fibre on top—and wheat germ and cinnamon. What a nutritious and tasty dessert! With the widespread insurgence of processed foods, most people are not eating enough fibre. An easy way to get your daily requirement is to add a couple of spoonfuls of wheat fibre to your favourite drink or yogurt. Trust me on this one. It will make a huge difference to your intestinal metabolism. Your legacy is my life and I thank God for you, every day. - John Longevity We tend to take our eating habits for granted, unless we are already ill! If we have everything and don’t have good health, we have nothing! For over 70 years, Union Gospel Mission has been feeding hope and changing lives by serving society’s most vulnerable. That reality can be changed— one spoonful at a time. s To learn more about bequests to UGM, please contact Christiane Sim at 604.215.5441 ext 328 or [email protected] Marco Castro is a BC Notary Public and Certified Immigration Consultant practising in downtown Vancouver. [email protected] www.provisa.ca Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 57 BC Notaries Speak Your Language BC Notaries around the province offer many noncontentious legal services (see page 75) in an impressive variety of languages. English Arabic Bulgarian Cantonese Croatian Dutch Farsi Filipino Flemish Fookien French German Gujarati Hindi Italian Japanese Korean Malaysian Mandarin Persian Polish Portuguese Punjabi Romanian Russian Serbian Shanghaiese Spanish Swahili Swatow Swiss Swiss German Tagalog Taiwanese Tamil Taoshan Telegu Urdu Vietnamese 58 TABLE OF CONTENTS TRIBUTE The George Whyte Award Created in 2001 by the Golf Committee of the Real Estate Institute T his award honours George Whyte, Chair of the Real Estate Council of BC and a long‑time real estate licensee who passed away suddenly in February 2000. George was a true gentleman. “He set an example for all of us to follow,” says Daniel Stewart, a founding member of REIBC Annual Charity Golf Tournament. Each year the George Whyte Award recognizes an individual who demonstrates exemplary professional conduct and achievements in the real estate profession and who supports the objectives of the Institute. Said Judi Whyte, who presented the award to David Podmore at the 2013 event, “Every year, George and David spent time at ‘The Summer Solstice Golf Event’ held in the Okanagan, a dawn-till-dusk male-bonding opportunity with numerous fellows from the real estate industry. When David hit a Hole in One in 1997, George was with him to witness this exceptional performance! “George truly admired and respected David for all his accomplishments in business, his dedication to the industry and the community at large—and his golf prowess! Judi Whyte “Congratulations, David.” David Podmore Recipients 2013 2012 2011 2010 2009 2008 2007 David Podmore, RI Scott Ullrich, RI James Harrison Dan Jones, RI Randy Brown Tim Callaghan, RI Steve Mullock, RI 2006 Cal Ross, RI 2005 Betsy MacDonald, RI 2004 Charlotte Ciok, RI 2003 Daniel Stewart, RI 2002 Lorne James, RI 2001 Roger Cheng, RI REIBC Unlock your full potential in the real estate industry 1750 - 355 Burrard Street Vancouver, BC V6C 2G8 Tel: 604-685-3702 Toll free: 1-800-667-2166 Email: [email protected] RI Designation — Your Assurance of Real Estate Excellence REIBC offers the highly recognized RI designation to real estate professionals from all areas of the industry who meet high education and experience standards. Get Connected Stay Connected To learn more about the Real Estate Institute of BC, visit us at www.reibc.org. The Society of Notaries Public of British Columbia Volume 22 Number 3 Fall 2013 Business to Business new card design.ai 26/08/2009 7:30:21 PM C M Y CM MY CY CMY K James L. Robinson NOTARY PUBLIC 250 656-3951 T: 604.931.1202 F: 604.931.1206 E: [email protected] 101 – 9830 Second Street Sidney, BC V8L 3C6 Real Estate Estate Planning Suite 240 – 1140 Austin Ave., Coquitlam, BC V3K 3P5 Seeking to add to your business career? There are business opportunities for Notaries in various communities throughout British Columbia. The Qualities of a BC Notary • Strong entrepreneurial and people skills • The highest degree of honesty and integrity • University degree and 5 years’ related experience • Fluency in English; other languages an asset • Financial backing • Dedication to serving the public Consider our Master of Arts in Applied Legal Studies (MA ALS) program, conducted through Simon Fraser University. For more information, please contact The Society of Notaries Public of BC 1-800-663-0343 or visit our website, www.notaries.bc.ca. BC NOTARIES ARE RESPECTED IN THEIR COMMUNITIES. Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 59 REIBC Real Estate Valuation and Consulting Services to Help You Make the Best Real Estate Decision Board of Governors 2013–2014 • • • • • Mandy Hansen, President (North Fraser District) Jason Grant, President-Elect (Vancouver District) Andrea Fletcher, Mandy Hansen Vice President (Vancouver District) Dave Graham, Secretary/ Treasurer (Kootenay District) André Gravelle, Past President Troy Abromaitis: Vancouver District Peter Bretherton: Vancouver Island District John Castle: NW/Prince Rupert Cariboo District Brad Currie: Fraser Valley District Daniel John: Vancouver District Tracy Wall: Thompson/ Okanagan District Thank you to Nathan Worbets, Bonnie Knight, and Ken Sherk for their past service. Appraisals: Residential, Commercial, Industrial Assessment Review and Appeal • Replacement Cost Analysis Highest-and-Best-Use Studies • Feasibility Studies Rental Analysis • Depreciation Reports Insurance Appraisals Georgina Ironmonger, AACI, P.App Owner and Manager of Keystone Appraisals, a full-service independent real estate appraisal firm Keystone Appraisals Inc. Trail: 250 368-6855 Nelson: 250 352-6855 Grand Forks: 250 442-0024 Fax: 250 368-6856 [email protected] www.keystoneappraisals.ca Timely Response, Experienced People, Objective Results! Proudly Serving the Kootenay Boundary Member: Appraisal Institute of Canada You’ve always been there for others. You can continue to give beyond your lifetime. Your gift Your generosity will help us be here tomorrow for those who need us. ABCLS Our Newest Surveyors Our vision For over 30 years, we have had a clear vision: people with disabilities having genuine independence, living with dignity, and contributing and sharing in our communities. Seamus Pope BCLS #923 Sechelt Vesselina Stoyneva BCLS #924 Surrey Joe Hadley BCLS #925 Victoria Mark Rossmann BCLS #926 Smithers BC Coalition of People with Disabilities advocacy since 1977 Please contact us about planned giving. BC Coalition of People with Disabilities Tel 604-875-0188 • TTY 604-875-8835 • [email protected] • www.bccpd.bc.ca 60 TABLE OF CONTENTS The Society of Notaries Public of British Columbia Volume 22 Number 3 Fall 2013 BUSINESS Editor’s Prefer Paperless? Photo credit: Michael McKenzie-Smith Would you like to read The Scrivener online, quarterly? We will add you to our private notification list. T [email protected] www.notaries.bc.ca/scrivener NEXT ISSUE: Winter 2013 LAND in BC! Square with Your Clients he fantastic visions of science fiction writers in the ‘60s never imagined what humans have achieved today. New: The Square Card Reader from Square, Inc®. This nifty gadget allows your cell phone to accept Visa® and MasterCard® payments from your customers. Rudy Nielson with his Wellness Consultant Duke Cover Story: This device fits into the ear jack of most phones with android operating systems or IOS (iPad, iPhone). It is a cheaper and more portable option than previous point-of-sale systems. Rudy Nielsen, President and CEO of Landcor Data® Corporation and Niho Land and Cattle Company Ltd. Easy registration for the Square Card Reader is available on their website. For registered account holders of Square, Inc., there is no charge for the unit. The MiX Download the application, link to your bank account, and your Reader will be delivered in 7 to 10 business days. •A vendor fee of 2.75% per transaction is retained by Square, Inc. •Your clients’ payments to you are directly deposited to your bank account, usually by the next business day. The Square system levels the playing field for smaller firms and increases the ease of doing business in the modern world. www.squareup.ca s Lisa Shaskin, owner of Lightspeed Courier & Logistics, is an entrepreneurial business woman with over 20 years’ experience in the transportation industry. The MiX showcases articles on a variety of timely topics. Considering submitting an article? Please write [email protected]. To send photographs to the magazine, please . . . •go to www.graffiki.ca, and click on “Send A File.” •From the top box, delete the words “Your e-mail.” •In that now-empty box, type your email address. •Send up to 5 photos at once. •Repeat as necessary. Deadline for Advertising Space: November 12 [email protected] Telephone: 604 985-9250 www.notaries.bc.ca/scrivener Telephone: 604 988-7401 [email protected] Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 61 MAKING A DIFFERENCE Cathy Grant October is Community Inclusion Month. F or thousands of British Columbians living with disabilities, including myself, Community Inclusion Month means hope—for increased independence, a better quality of life, and a better future. Born with cerebral palsy 54 years ago, I have spent my every waking hour in a wheelchair, dependent first on family then on care workers to provide the basic necessities of life that able-bodied individuals take for granted. Among other things, the care workers bathe, dress, and feed me every day. Born with cerebral palsy 54 years ago, I have spent my every waking hour in a wheelchair… ©iStockphoto.com/Michael Svoboda I do not feel sorry for myself. I feel grateful that I have the mental capability and the drive to work with organizations and groups to help bring about positive change for all people with disabilities. Whenever possible, I go out with family and friends instead of staff. That gives me more of the independence I desperately need in my life. 62 TABLE OF CONTENTS October is Community Inclusion Month. Every year, Inclusion B.C. dedicates the whole month of October to raising awareness—drawing attention to the ongoing needs of persons living with developmental disabilities and celebrating the achievements and victories of self-advocates and their families. The Society of Notaries Public of British Columbia Photo credit: Leea Gillard Community Inclusion is for Everyone Launched in BC in 1996 and adopted nationally in 1998, Community Inclusion Month (previously Community Living Month) is for everyone, not just the disabled; it focuses on true inclusion in all aspects of society. Community Inclusion Month includes art shows, picnics, concerts, celebrations, community ceremonies, forums, and much more. The broad range of 100 or so activities takes place all over the province, making the point that people with disabilities are fully part of our communities. This year’s theme is “Relationships—The Heart of Inclusion.” Everyone can get involved. Last year, an event at the annual Self-Advocacy Leadership Institute had self-advocates learning about rights, safety, healthy relationships, and becoming leaders in their communities. The “Hi Initiative” emphasized the importance of small actions like saying “Hi” to a person in a wheelchair . . . the first step toward making a connection. Connections give people with developmental disabilities a greater sense of safety, belonging, and welcome in the community. Another past theme was “Inclusive Employment.” Employed self-advocates nominated an employer or co-worker who went above and beyond to create a welcoming and respectful workplace. Volume 22 Number 3 Fall 2013 It will be helpful to have more workshops to help able-bodied persons better understand the needs of disabled people—for example, housing, competent caregiving, and improved wheelchair access in public buildings. Try spending a day in a wheelchair; you will quickly discover how difficult and isolating it can be. There was a time when people born with disabilities like mine or individuals involved in a serious accident were never seen in public. We were hidden at home or kept in places away from the view of the general public. Thanks to the accomplishments of such groups as Inclusion B.C., Technology for Independent Living, and Spinal Cord Injury B.C., to name a few, there have been great changes to attitudes. BC Notaries can assist in the professional preparation of the legal documents everyone needs, such as a Power of Attorney, Representation Agreement, an Advance Directive, and a Will. Help create a better future for everyone touched by cancer. Discovery needs willing partners. When your client remembers the BC Cancer Foundation in their will, they’ll be supporting world-renowned research in BC that is shaping the future of cancer care. Please be sure to use the full legal name of our organization: BC Cancer Foundation Registration Number: 11881 8434 RR0001 For more information, please contact Isabela Zabava, LL.B at 604.877.6040 or [email protected] People with disabilities need to be productive and to contribute to the community through some sort of employment or volunteer work. To live comfortable and productive lives, we also need a budget. Over the years, many rallies in the province have focused on an attempt to “stop the cuts” to government funding. Back in 2011, without warning, government services were completely stopped for 9 weeks. I suddenly had no staff assistance, no caregivers, and no money. It was horrific. People in wheelchairs participate in most aspects of “normal” life. Community Inclusion Month is one way that positive change has come about. When members of the general public become involved, they feel included. They see that they can make a difference. s Cathy Grant, fierce advocate for persons with disabilities including herself, is unstoppable. www.inclusionbc.org www.civilrightsnow.ca [email protected] Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 63 GIVING BACK Setareh Khasha The Birth Lottery: My Days in Haiti and the Lessons Learned Photo credits this spread: Kelly Fearon A nyone who knows me well knows how much I wanted to engage humanitarian work in Haiti. “Why Haiti?” people often asked. I remember learning about the country during my undergrad at UBC. Something about Haiti touched me. I felt connected to the stories of the people and a sense of urgency to get involved. Maybe it was the level of poverty or their recent series of unfortunate events. It felt right in my heart to find a way to get there. The lessons I learned there about life, others, and myself will stay with me forever. 64 TABLE OF CONTENTS My biggest challenge in this journey was to find an organization that suited the reasons I wanted to go. I searched for a long while. In a serendipitous fashion, my coworker introduced me to the nonprofit organization “Live Different.” It has various programs; one of them facilitates interested volunteers to experience humanitarian missions. Their 10-day humanitarian trips are volunteer-run adventures that aim to educate and involve caring individuals in countries of dire need, The lessons I learned there about life, others, and myself will stay with me forever. like Haiti.1 In partnership with a Haitian organization, “Live Different” began a construction project in 2010 to build the only school in Cap‑Haïtien. Every trip to Haiti aims to further the construction on this project. The other volunteers and I helped with the construction of two more classrooms to expand the school. 1Find out more about Live Different “Hero Holiday” humanitarian trips. http://livedifferent.com/hero-holiday Once the time had finally come for my departure, I was both nervous and excited. I took a deep breath before getting on the plane and assured myself that whatever was ahead of me would be inspiring and one of my greatest adventures. After the long flight from Vancouver to the Dominican Republic and a 5-hour bus ride, the team of volunteers, Live Different staff, and I were at the Haitian border. We cleared Customs, grabbed our bags, and walked across the border in the intense heat. To my surprise, I did not feel scared or unsafe. I was curious as to what the next 10 days would hold. We arrived at our hotel and it was time to go to the worksite. We were warned about the strenuous climb to the school site. We had to climb that hill twice a day—in the morning and again after lunch. It never got easier and the extreme humidity did not help, but I did not complain . . . I had a stomach full of food and a fully hydrated body. Those basic needs are a real challenge for the people of Haiti. The view from the school was dazzling and heartbreaking at the same time. Seeing such an image juxtaposed with such dire living conditions was incredibly difficult to process. The school was built entirely from cement and cinder blocks. Imagine trying to build any kind of infrastructure with no equipment, no tractors, no cranes, no lifts—just your hands. The contractors were there before we got to the worksite at 9 am and stayed after we left at 4. They worked tirelessly without any breaks or moments to catch a breath in the Haitian heat. They moved rocks, buckets of cement, and other heavy objects with such ease it absolutely amazed me. Almost none of them had shoes, let alone protective gear. Their bare hands worked with rocks and the toxic cement all day. As we got to know some of the workers, we would give them our gloves. They were working with much rougher materials and it seemed like the right thing to do. They were always appreciative and returned the gloves at the end of the day. Moments like those confronted and crushed my preconceived notion that I would encounter theft due to their degree of poverty. That was not the case. The Haitian people are very proud; their character is important to them. It made sense when I thought about it; in a world where there are no material goods, your word is really all that matters. One of the most tragic aspects of life in Haiti is the lack of access to clean water. I had never thought about how incredibly lucky I am to walk to a sink and turn on a tap. Just one motion and there it is— unlimited clean water. One of the most tragic aspects of life in Haiti is the lack of access to clean water. TABLE OF CONTENTS 65 Photo credit: Benjamin Cole Brown Haitians must get water for drinking, washing, and cooking through a painful and time-consuming process. There is no water system in most areas of Haiti; everyone in the village relies on natural wells. We had watched people walking up steep hills and through the village with huge buckets of water on their heads. When we were told we would be helping to carry water, I was unsure I could physically do it. Putting my reservations aside, I volunteered to go to the well first with a few other girls in our group. Taking a break from building to help a family cook their dinner I remember the locals staring at us. Junior, our translator, told us they were laughing to see the group of blan (whites, in Creole) try to carry the buckets. We were laughing, too, as we tried to manoeuvre them. I had some help from the locals to fill up my bucket and lift it from the well but I could not get it to the top of my head. We decided to empty half the water from my bucket so I would have a fighting chance. It was a surreal and humbling experience to walk as a foreigner through the neighbourhoods of Cap‑Haïtien. At one point in my climb, I didn’t think I could do it. Exhausted, I put the bucket down. Behind me, Junior was offering words of encouragement when two young Haitian girls ran up to my side and started speaking Creole. I looked to Junior for help. “They want to carry your bucket for you,” he said. “They say you look like you’re having a lot of trouble and they want to help.” Once we all had our buckets, we started up the rocky hill. The pain from the weight was sharp and travelled all through my neck and spine so I decided to carry it on my shoulders. The 30 minutes back to our worksite was physically and emotionally draining—all that effort for just one bucket of water . . . and water that was not even sanitary. Each house was occupied by 5 or 6 people in a space the size of a standard bedroom in a modern home. Everything about the living conditions was poor but somehow hope and laughter shone through the spirit of the people; their smiles radiated beyond the poverty. All I ever saw around me in Cap‑Haïtien were children, teenagers, adults, and seniors who found the energy and strength to work tirelessly to simply survive. The two classrooms were almost done. On the last day, we had to finish the hardest part of the project— the roof. Along with the Haitian The worst part of poverty is how much time it takes: Carrying water from natural well 66 TABLE OF CONTENTS Photo credit: Benjamin Cole Brown Photo credit: Benjamin Cole Brown They could not have been older than 8. Those delightful young girls—children who should be playing with no worries—wanted to relieve me of my pain the first chance they saw to help. Such an act of sincerity and compassion is something I experienced every day in Cap‑Haïtien. On our time off, we walked through the villages introducing ourselves to the residents; it was customary to greet others with bonjour or bonsoir. It was a surreal and humbling experience to walk as a foreigner through the neighbourhoods of Cap‑Haïtien. Every family lived in a shack made of mud, stones, and wood. I was in a different world. Strength personified: One of the Haitian contractors hard at work The Society of Notaries Public of British Columbia Volume 22 Number 3 Fall 2013 contractors, we divided ourselves into groups of cement mixers, pourers, bucket carriers, and roof stabilizers. People from the around the village came to help us, carrying water up the hill for making the cement or jumping into our bucket line to hand-off buckets of cement to the contractors on the roof. We began to develop a flow. Even though none of us spoke Creole and none of the contractors spoke English, we all felt a bond. We were accomplishing something great together; it’s an experience we will always share. After hours of working with the heavy cement, the roof was done. I never thought cement could look so beautiful. We had successfully built two classrooms and now the school could hold over 300 students. As we were all taking a break, our group wanted to show our appreciation to the Haitian builders. We asked Junior to tell them how grateful we were for their work and patience with us. We opened a cooler and pulled out the number-one-rated brewed beer in the world—the Haitian beer Prestige! The workers began to cheer with huge smiles on their faces. We handed a bottle to each person and celebrated our accomplishment. It was a wonderful moment. When I came home from Haiti, I was bursting with stories. I wanted to spend hours telling everyone everything I had seen. I soon realized my experiences could not be fully understood. The thousands of images in my head that have changed my perspective can never be the same for a person who was not there with me. Volume 22 Number 3 Fall 2013 Photo credit: Kelly Fearon Photo credit: Kelly Fearon One of many moments of joy and laughter at the school Faces of hope. The beautiful children of Cap‑Haïtien are incredibly resilient and the heart of the city Hearing stories is always touching but it does not have the same depth as first-hand experience. Because of that, I try to inspire individuals to pursue volunteerism and humanitarianism on their own. The benefits and lessons that come from giving are most significant to the person who does the giving. Whether we were born in this country or immigrated here, we as Canadians have won the birth lottery. We have a stable government with many levels of support. We have strong systems of education and health care. We have opportunities to work and develop our skills. We have water— without it, nothing else matters. We have everything we need to have a happy life. …we as Canadians have won the birth lottery. It is hard not to feel a sense of guilt when you travel to a place like Haiti . . . we accept so much excess when millions of others go without. Unfortunately, that is the way we find our world. It will take years to change that dynamic. But we are not without hope. It would be truly unfair for us to waste our resources, health, money, and time not helping others. The number one lesson I learned in Haiti is how much you get back from helping others. The sense of happiness I felt when we finished the classrooms was unexplainable. We helped create a venue for education and community-building, a place where precious children can learn important life lessons. The Scrivener We are all capable of doing something great and making a difference. Ordinary people like you and me can decide to live different . . . to wake up and live with purpose and compassion. It does not have to be somewhere far away. Even in our own neighbourhoods, many people need help. Giving another person assurance that someone is thinking of them and feels their pain is one of the greatest gifts we can give. Everyone deserves to be heard and to be seen and respected. Because we have won the birth lottery, our responsibility should be to find a cause we are passionate about and spend our winnings helping those who are not so lucky. I saw it every day in Haiti. People who had nothing found a way to help their siblings, their neighbour, and even strangers like me. The biggest waste in our lives is to live selfishly, always wanting more . . . a bigger house . . . a better car. To live in a constant state of dissatisfaction with what we have is the surest route to misery. Spending our lives trying to compete, out-earn, and out-do our neighbour is how we become morally and socially bankrupt. What Haiti made me realize is that helping others is the only way we can truly become richer. s Setareh Khasha, BA, a first-year law student at Thompson Rivers University, lives in Kamloops, BC. [email protected] http://www.youtube.com/watch?v=cC7_iEk97I TABLE OF CONTENTS 67 LETTERS LETTERS LETTERS LETTERS LETTERS ©iStockphoto.com/Poula Thorsen LETTERS Congratulations on your Summer 2013 Issue of The Scrivener. On behalf of all my colleagues at Do Process Software, I wish to extend a sincere thank you to the BC Notaries. It is excellent and should be required reading for anyone buying a strata in this province. I hope you will consider updating and re-running it in 3 or 4 more years and adding information on strata education available from various sources. We had the pleasure of participating in the Notaries’ 2013 Fall Conference in Kelowna and were overwhelmed with the reception we received from the members of The Society. Everyone was so friendly and welcoming. Do Process is extremely proud to be associated with the BC Notary community. We are truly grateful to have been included in this important and enjoyable weekend of education and activities—we are already looking forward to next year’s event! Regards, John Robinson, Executive Director Do Process Software [email protected] Got a Comment? [email protected] Thank you for the extra copies of the Summer Scrivener magazine. As president of a small strata complex in North Vancouver City, I made sure every owner in our building received a copy. The issue is most interesting. Those who have already read it agree that the articles are well written and useful tools to keep and to share with new owners. Alan Dion North Vancouver 68 TABLE OF CONTENTS Summer 2013 I also enjoyed the interview with Scott Ullrich and learning how he got into the “real estate business.” I am a family physician in practice on the Saanich Peninsula outside Victoria since 1983. After initially assuming The Scrivener would be pretty dry reading, I was pleasantly surprised to learn that each issue contains information of mainstream interest. The Fall 2011 issue [page 6] contained a very useful onepage summary of the recommended three documents for incapacity planning— Power of Attorney, Representation agreement, and Advance Directive— and the reasons for each. I share that article with seniors in my practice when we have a discussion about preparing an Advance Medical Directive. Fall 2011 Volume 20 • Number 3 Published Quarterly by The Society of Notaries Public of British Columbia Victoria Notary Sabrina Hanousek and her Fabulous Team! INSIDE: Teamwork Publications Mail Agreement: 40010827 Your most recent Summer 2013 issue contains a gold mine of information for strata homeowners. I intend to share that one with other owners in my own strata. Well done! Dr. James Forster Brentwood Bay, BC The Society of Notaries Public of British Columbia Robert O. Fawcett, Executive Officer Real Estate Council of British Columbia Telephone 604 683-9664 www.recbc.ca Thank you for sending extra copies of The Scrivener magazine to my office. I am delighted to give a copy to my clients for their reading pleasure and have received several phone calls expressing how much they like certain articles . . . I tell them they can enjoy the previous issues of the magazine on our website. www.notaries.bc.ca/scrivener Thanks again! Mary-Ann MustonenHinds, Notary Public Telephone 604 710-9931 mustonen.notary@ gmail.com We Love to Hear From You! [email protected] Volume 22 Number 3 Fall 2013 THE MATURE MARKET Rhonda Latreille On the Telephone To seniors, that can seem like a negative demonstration of ageism. •When leaving a phone message, SLOW DOWN when you leave your phone number. Repeat your name and number at the end of the message. That gives the other person the opportunity to write down your information or instructions. Take a moment to think about the assumptions that would cause people to change their normal demeanour, elevate the tone of their voice, and reduce the intellectual level of their conversation with any individual— independent of age. You will soon see whether that behaviour is accommodating or patronizing. I have yet to find an instance when changing the quality of my communication is truly accommodating to the other person. Emerson said, “Who you are speaks so loudly, I can’t hear what you are saying.” Who we are is what we bring to every interaction and communication. What we believe informs others about who we are. Here are some general communication tips to apply when serving people, especially older customers, to help you create more engaging and respectful interactions. Volume 22 Number 3 Fall 2013 •Whenever possible, provide an opportunity for callers to speak to a real person without having to cycle through a long list of menu items. •If you are leaving a telephone number or instructions, let your client know that they will need a pen and paper handy. •Keep your sentences short. Offer one step at a time. Make sure you have stated the information clearly. In Person •Look directly at your customer or client when you are speaking, and keep your hands away from your face. That helps you project your voice and gives your customer the opportunity to read your lips and your expressions. •If your clients are seated, remain seated while you are having a conversation so that you are not towering over them. The Scrivener Photo credit: Gordon Roberts •Ask your customers how they wish to be addressed. I have yet to hear anyone ask to be called “Dearie.” •Avoid professional jargon, use familiar words, and keep your voice conversational. •When a person asks you to repeat something, his or her challenge might be clarity as well as volume. State the same information in a different way and provide a bit more context. Above all, use the universal language of THE SMILE! It goes a long way to making someone feel welcome, valued, respected, and appreciated! s Rhonda Latreille, MBA, CPCA, is the founder of Age-Friendly Business®. Telephone: 1-877-272-7575 [email protected] ©iStockphoto.com/Kabliczech S ometimes, in front of young children or the elderly, normally intelligent and rational adults speak in a singsong falsetto voice . . . like a Saturday morning cartoon character ©iStockphoto.com/miniature Ageless Tips for Effective Communicating Inspired by the United Nations endorsed Age-Friendly City initiatives, Age-Friendly Business® made the commitment to build upon this noble foundation and to invite businesses and professional services to participate in the Age-Friendly Revolution. To find a Certified Age-Friendly Business (CAFB)® or a Certified Professional Consultant on Aging (CPCA)® near you, go to www.AgeFriendlyBusiness.com. To find out how you can become a Certified Age-Friendly Business or a CPCA, phone toll free 1-877-272-8086. TABLE OF CONTENTS 69 COPYRIGHT AND ONLINE IMAGES Jennifer Dove Beware Using Other People’s Pictures! J ohn asks his assistant Mary to spruce up his business website. She does some image searches on Google and finds a few photos . . . right-click, save image, upload, et voilà, the website has a facelift! Months later, John gets a strongly worded cease-and-desist letter from a lawyer representing the photographer who took one of the photos that Mary used for the website. The letter alleges copyright infringement and threatens further legal action if John does not immediately remove the photo and pay $2000. Not wanting to get involved in a legal dispute, John complies. Let’s leave aside the fact that John might have benefitted from the advice of a copyright lawyer before conceding to all the lawyer’s demands. The fact remains that Mary’s lack of familiarity with copyright—and John’s failure to verify that permission was obtained to use the photograph— resulted in a costly mistake. Many businessowners have found themselves in a similar situation, particularly those who create and manage their own blog or Facebook page. Here are some copyright basics to dispel some common myths so you can avoid falling into the same predicament John experienced. 70 TABLE OF CONTENTS Copyright: The Right to Copy •Copyright means the sole right to produce or reproduce an image or a work and to authorize others to produce or reproduce an image or a work. •Copyright protects all original artistic, literary, dramatic, and musical works as well as sound recordings, performances, and communication signals. •Copyright is automatic; an image or a work is protected as soon as it is created. Copyright for Online Images True or False? Images found online are not protected by copyright. False. In most instances, copyright does attach to online images, which means you must obtain permission from the copyright holder before reproducing the image on in your website, blog, or print marketing materials. Public Domain It is safe to assume that most images found online are not part of the public domain. “Public domain” has a specific meaning in relation to copyright. Under Canadian copyright law, photographs and images in the public domain are typically works created by an author who died more than 50 years ago and for which the copyright has expired. They can be used without permission. The Society of Notaries Public of British Columbia Images found online may or may not be part of the public domain and thus available for use by anyone. Q: What if there is no © symbol? A: It doesn’t matter. Copyright exists whether or not the copyright symbol or other copyright notice is used. Q: Underneath the image I used, I included a link to the photographer’s website and a photo credit. Is that good enough? A: Not necessarily. Giving credit where credit is due is a nice thought, but it does not absolve you of your obligation to obtain authorization from the copyright holder to use the image. Remember, it is the copyright holder’s decision regarding if, how, when, and by whom the image may be reproduced. In some cases, a licence to reproduce an image will be granted by the copyright holder simply on the condition that credit is given to the author. That permission must be expressly stated on the website—and never assumed. Q: I found a photo online and asked the owner of the website if I could use it. He said Yes. Is that good enough? A: Beware feeling you have done your due diligence because you got permission from a website to use a photo posted there. No. The website owner may not own the copyright for the image and therefore has no right to decide who uses it. Volume 22 Number 3 Fall 2013 Generally speaking, the photographer owns the copyright for the photo, unless it was taken in the course of employment or assigned in writing to someone else. (Prior to November 7, 2012, copyright for commissioned photographs belonged to the party that commissioned the work.) Q: What could happen if I violate someone’s copyright? Q: If it is advertised as a “free” image, is it copyright-protected? Source your images on stockimage sites such as istockphoto. com, shutterstock.com, flickr.com, gettyimages.ca, and morguefile.com. For a fee, you can download and use images in accordance with their terms of use. The cost of a licence is usually very cheap in comparison to the legal fees to respond to a cease-and-desist letter or lawsuit. As mentioned above, many sites offer licences to use photos for free (Morguefile.com, Flickr.com, etc.). A: Many websites offer images that can be used without a fee but generally those images are still protected by copyright. The copyright holder is simply granting permission to use them with few or no conditions. Even with free-to-use images, it is important to read the terms of use applicable to the specific images you want to use. Some licences are granted for noncommercial purposes only or for use on a website but not on merchandise that will be sold. Some terms/licences allow changes to be made to the image, while others do not. You need to make sure that your plans for using the image fall within the scope of the licence. A: You will likely need to remove the image and may be faced with a lawsuit, monetary damages, and/or legal fees—not to mention bad karma. A Few Basic Rules 1. Obtain Permission 2. Read the Licences Permissions will vary from site to site and image to image. To understand the scope of the permission being granted, you must read their licence/ terms of use. 2. Ask Your Designer On sites such as Flickr, you can find many images made available free under a “Creative Commons” licence. These are simple, standardized licences that give the public permission to use and distribute an image for free, provided certain conditions are met. If you are hiring someone to design your website or your print materials or manage your blog, find out where that person sources photos and confirm whether there are any licence restrictions, such as expiry dates. Where appropriate, request copies of invoices and licences. All levels of Creative Commons licences require that you attribute the work to the original author. Depending on how you intend to use the image, the attribution requirement may not be desirable from an aesthetic or practical standpoint. If you can’t include credit to the original author, don’t use images under a Creative Commons licence. 3.When in Doubt, Don’t Use It Q: What are “Royalty Free” images? A: Royalty-free is not the same as “free.” Many websites offer stock photos. In some cases, you pay a onetime licence fee that allows you to use the image as many times as you wish without having to pay a royalty for each use. It does not mean you own the copyright for the image. Volume 22 Number 3 Fall 2013 If you find an image you love online but it is not on a stock-photo site and you cannot find the author’s contact information to obtain permission, don’t use it. A failed attempt to contact the copyright holder is no defence to infringement. It is always a good idea to consult a copyright professional. s Jennifer Dove is a Registered Trademark Agent with Coastal Trademark Services in Vancouver. She has been working in the intellectual property field since 2003. Telephone 604 687-7432 [email protected] www.coastalip.com The Scrivener Leave a a Legacy Legacy Leave in your WiLL in Your Will remembering Variety Variety– -The The By remembering Children’s Charity Charity ininyour yourwill, will, Children’s you can help children who have have special needs needs ininthe theprovince. province. Your generosity will provide hope, Your generosity will provide enrich lives, and build a better hope, enrich lives, and build forfuture children Xander. afuture better forlike children like ForXander. more inFormation on hoW For to Leave a Legacy: more info ... (604) 320-0505 Call (604)Call 320-0505 or Toll-free 1 (800) 381-2040 Toll-free 1(800) 381-2040 website or visitVisit our our website at at www.variety.bc.ca/legacy. www.variety.bc.ca/legacy TABLE OF CONTENTS 71 Wills & Estates Trevor Todd Judith Milliken, QC Sibling Rivalry: Mom Always Loved You Best S ibling rivalry is rife in estate litigation and often comes to the fore with the death of the parents— particularly the last parent. Although some fortunate siblings may be the best of friends, that situation is obviously rare in our practices. One of our favourite sibling stories happened in the case of “Robert.” He was the youngest child, born many years after his four older siblings. Seemingly minor childhood conflicts can result in underlying resentments that may last a lifetime. ©iStockphoto.com/Fertnig Photography Robert and his mother “had been very close” and when she died, he ended up with her entire estate. The disinherited siblings sued. At the examinations for discovery, the siblings were extremely hostile, glaring at Robert. During questioning, Trevor asked Robert’s older sister about her obvious hatred toward her youngest brother. He fully expected to hear how Robert was selfish, greedy, and dishonest. Instead, the sister responded, “He was allowed to have cheese sandwiches before bed and we weren’t!” The others nodded in agreement. 72 TABLE OF CONTENTS The Society of Notaries Public of British Columbia That story serves as an allegory for sibling rivalry. Seemingly minor childhood conflicts can result in underlying resentments that may last a lifetime. Such resentments often emerge during the emotional upheaval following the death of parents. Sibling rivalry exists among most animal species where competition begins at birth. The rivalry may be extreme—take for example, the black eagle who lays two eggs. Mother looks on while the first hatchling pecks the second to death. Among humans, sibling rivalry dates back to the Bible. The Book of Genesis tells of the jealousy between Adam and Eve’s sons Cain and Abel. When Cain kills Abel, the first murder occurs. That story has inspired much Western art and literature over the centuries. Sibling rivalry remains a common theme in our culture and is found in television shows from Leave It to Beaver to Family Guy, from Friends to The Smothers Brothers with Tommy’s frequent refrain, “Mom always loved you best.” Social media loves to report on the “friendly” tennis competition of Venus and Serena Williams. Our clients often include those who adopted traits that their parents approved of, those who rebelled, and those who simply withdrew from the competition altogether. It seems many of us grew up with internal labels such as “I’m the smart one,” “I’m the athletic one,” or “I’m the black sheep.” Volume 22 Number 3 Fall 2013 Unfortunately, it seems some parents more or less openly favour a preferred child. Others needlessly criticize a less-favoured child. Such treatment inevitably creates resentment between and among the siblings. Psychologists report that from age 18 months, siblings can understand family rules and know how to comfort and be kind to each other. By age 3, children have a sophisticated grasp of the social rules within the household and know how to adapt to circumstances within the family. One school of thought suggests that fighting among siblings may actually increase in adolescence, with early teens reaching the highest level of competition. Some say that sibling bullying and abuse are largely underreported. Recent studies have indicated that bullying and aggressive behaviour by a sibling can be just as damaging as bullying by a classmate, neighbour, or peer. Most disturbing in our practice are the surprising number of female clients who have apparently suffered sexual abuse by a teenage brother, usually a few years older. They include serious sexual assaults leaving lasting scars. The Role Played by Parents While it is natural for siblings to compete, parents can certainly have a positive or a detrimental effect in reducing the potential to cause great damage. Starting early to reduce such rivalry is key. It is beyond the scope of this article to provide parenting advice but there are many useful self-help books available, for example Siblings Without Rivalry by Adele Faber and Elaine Mazlich. By the time most clients reach a lawyer’s office, the horse is out of the barn. It often seems parents have contributed to rivalry by encouraging competition, snitching, teasing, or displaying overt favouritism. We also unfortunately see the results of highly dysfunctional families where a parent with a personality disorder has deliberately played one sibling off against the others for most of their lives. Sibling rivalry is inherent in human nature. Most of us grew up competing for an equal share of limited family Volume 22 Number 3 Fall 2013 Parents are strongly encouraged to divide their estates in equal shares among their children. resources, whether that be parental attention, time in the bathroom, or a share of dessert. Other complicating factors include the so-called “blended family” involving step-siblings Many cultures also significantly favour males, which can lead to “societal sibling rivalries” between men and women. Significant life issues such as care giving for elderly parents or unequal treatment in inheritances can inflame old grievances and perceived slights. Even making funeral arrangements can bring out the worst in the surviving children. While siblings display an intense need to share equally in their inheritances, unfortunately some parents continue to play favourites until the end, leaving some children much larger or lesser shares of the estate. That usually causes incredible bitterness and resentment. On a basic level, survivors equate inheritance with parental love and cannot bear being loved less by a parent than their siblings were loved. Lesser shares also invite litigation under British Columbia’s Wills Variation Act for it defies the moral claims of the children to share equally in their parents’ estates. The societal expectation that children will receive equal shares was recognized by Madame J. Daphne Smith, now of the Court of Appeal, in Ryan vs. Delahaye 2003 BCSC 1081. In paragraph [67] she said, “In the absence of express reasons for an unequal distribution, contemporary standards create a reasonable expectation of children sharing equally in a parent’s estate.” Reducing Sibling Rivalry after Death Parents are strongly encouraged to divide their estates in equal shares among their children. If there is a compelling reason to do otherwise, it is crucial for parents to address their communications thoughtfully. The Scrivener For example, if one child has a disability, it is important that the memorandum accompanying the Will explain that fact clearly. Such an explanation will often be better received if also delivered to the family in person, while the parent is still alive. Clarity is also extremely important. Even matters such as funeral arrangements can cause great conflict between and among siblings after death when emotions of grief can easily turn to anger. Long-standing resentments by siblings can manifest in pettiness—basically the need to control . . . to flex their muscles and withhold control from others. Minimizing the opportunity for conflict is important. Clear, written directions by the parent are often persuasive, for example, directions for any funeral or celebration of life, clear directions as to who specifically should receive which items of personal property. In these days of ubiquitous technology, for further clarification it is easy to take photographs and attach them to any list. Thoughtful legal practitioners will have many more practical suggestions for addressing this age-old problem. s Trevor Todd restricts his practice to estate litigation and has practised law for 38 years. He is a past President of the Trial Lawyers Association of BC, a past chair of the Wills and Trusts (Vancouver) Subsection, and a past president of the New Westminster Bar association. He frequently lectures to CLE, TLABC, the BC Notaries, and various law, business, or general public sessions on estate law issues. Disinherited.com is 17 years old. It has hundreds of blogs and articles and currently over 5600 visitors per month on average. Judith Milliken, QC, hails from Saskatchewan. She has practised law in BC since 1976. A former commercial lawyer then senior Crown Counsel, she is a highly experienced litigator who practises exclusively estate litigation, Wills, and trusts with Stewart Aulinger, Vancouver. [email protected] TABLE OF CONTENTS 73 Taxes Andrea Agnoloni It’s in Your Interest to Make it Tax Deductible T ax strategies for individuals and businesses are aimed at minimizing income taxes using the allowed rules and regulations. One of the main tax-effective strategies for an individual earning employment income is to invest in Registered Retirement Saving Plans, which provide for a deduction from taxable income to the extent of the RRSP contribution. What else is available to an employee whose income is generated just from employment? In my 20 years of public practice, I have seen individuals starting small businesses without a reasonable expectation for profit or investing in rental properties with negative cash flows so they can write off the losses against their employment income. In the end, they are spending $100 to save at most $43 in income taxes, leaving them with a negative cash flow of $57. I joke with my clients, telling them they can write me a cheque for additional accounting services so they can save more taxes! The typical family today •owns a home that was purchased using mortgage financing, 74 TABLE OF CONTENTS One of the main tax-effective strategies for an individual earning employment income is to invest in Registered Retirement Saving Plans •has RRSP funds that are purchased on a monthly basis to dollar cost average, and •owns nonregistered investments that pay regular dividends. Unfortunately, the interest paid on the mortgage of the principal residence is not deductible for income tax purposes. •Paragraph 20(1)(c) of the Income Tax Act specifies that for interest to be deductible, the amount must be pursuant to a legal obligation and the amount must be reasonable. •Further, borrowed money must be used for earning income from business or property. •The Income Tax Act requires tracing the use of the borrowed funds to a specific eligible use. There must be a direct link between the borrowed money and an eligible current use; the money must be used for the purpose of earning income from a business The Society of Notaries Public of British Columbia or property. For example, if a taxpayer borrows money to invest in rental property or in the stock market, the interest paid is deductible. What strategies are available to convert mortgage interest to tax‑deductible interest? Debt Conversion •If you have nonregistered investments, you can sell them and pay down the mortgage with the proceeds. •Immediately re-borrow the same amount to invest. The interest payments on the new loan will now be deductible because the funds are used directly to earn income. Are there other tax consequences with that strategy? •The sale of the investment may trigger a capital gain; that can be a good thing, if you have available capital losses from other years. •There could also be transaction costs involved with the sale of the investments, but the benefit of the interest tax deductibility may outweigh the cost. The Smith Manoeuvre •This strategy involves borrowing from the available equity in the home. Volume 22 Number 3 Fall 2013 •As you gain equity with each mortgage payment, you re-invest the money. For the Smith Manoeuvre, the current mortgage must be linked with a credit line. With each mortgage payment, the principal is paid down; that provides more available credit on the credit line, which can now be invested. For example, if the mortgage payment is $2000 per month and the principal portion is $1000, you can borrow $1000 from the credit line to invest. That strategy achieves some objectives. 1.The mortgage payments are slowly converted from non-tax-deductible to tax deductible, as you re-invest the principal repayment. 2.Funds are invested to provide for retirement. 3.Investments are purchased regularly on a monthly basis (or biweekly), benefitting from the dollar cost averaging rather than investing one lump sum. The downside of that strategy is you still have to pay interest on the line of credit. You can, however, borrow from the credit line to pay the interest on the credit line; that requires zero cash flow. If the bank does not allow borrowing from the credit line to pay its interest, then you can pay the interest from your chequing account and borrow the same amount from the credit line to replenish your bank account. Debt Consolidation If you have other personal debts and home equity available, you can consolidate all the debts into your mortgage so that, over time, you can convert all the personal non-taxdeductible debt to tax-deductible interest. That is done using the same Smith Manoeuvre strategy. Some key tax issues must be considered to maintain the tax deductibility of the interest. a.It is critical that the money borrowed can be traced to the investment purchased. Volume 22 Number 3 Fall 2013 b.Nondeductible debt must be kept separate from deductible debt. c.There must be a current use of the money borrowed for investment purposes. If the leveraged investment is sold and the proceeds are not used to pay down the loan, the interest on the loan is no longer deductible because the current use of the money is no longer for investing. d.The investment purchased with borrowed money cannot be in RRSPs or TFSs. e.There must be a reasonable expectation of income—the investment is expected to pay some dividend or interest at some time. All the stocks and mutual funds would meet that requirement unless the prospectus prohibits paying dividends. f.When the investment is sold, the lower of the original cost or the proceeds must be used to pay down the loan—or the interest on that amount becomes nondeductible. g.When dividend or interest income is received on the investment, that income does not have to be used to pay down the loan. If, on the other hand, the payment from the investments is considered return of capital, that amount must be used to pay down the loan or the interest on that amount is no longer deductible. Borrowing to invest is inherently risky and should never be done only for the tax deductions. It is generally suitable for more aggressive investors with a long-term view. It is highly recommended that you consult professional advisors before embarking on those types of strategies. s Andrea Agnoloni, CGA and Notary Public, is a Principal with EPR North Vancouver, an Independent Member Firm of EPR Canada Group Inc. Telephone: 604 987-8101 [email protected] www.eprnv.ca www.facebook.com/eprnv The Scrivener Services a BC Notary Can Provide Notarization/Documents •Affidavits for All Documents required at a Public Registry within BC • Certified True Copies of Documents •Execution/Authentications of International Documents • Notarizations/Attestations of Signatures • Personal Property Security Agreements • Statutory Declarations Personal Planning • Estate Planning • Health Care Declarations • Powers of Attorney • Representation Agreements • Wills Preparation • Wills Searches Travel • Authorization of Minor Child Travel •Letters of Invitation for Foreign Travel • Passport Application Documentation • Proof of Identity for Travel Purposes Business • Business Purchase/Sale •Commercial Leases and Assignment of Leases • Contracts and Agreements Property Matters • Easements and Rights of Way • Insurance Loss Declarations • Manufactured Home Transfers • Mortgage Refinancing Documentation • Purchaser’s Side of Foreclosures •Residential and Commercial Real Estate Transfers •Restrictive Covenants and Builder’s Liens •Subdivisions and Statutory Building Schemes • Zoning Applications Marine •Marine Bills of Sale and Mortgages • Marine Protestations Some BC Notaries provide these services. • Marriage Licences •Mediation • Real Estate Disclosure Statements Over 300 Notaries to Serve You! For the BC Notary office nearest you, please call 1-800-663-0343 or visit www.notaries.bc.ca. TABLE OF CONTENTS 75 TECHNOLOGY Akash Sablok The Premier Custom Tartan from Parker Pen The pen is mightier than the sword— and the stylus. When you do put pen to paper, you want the experience to be pleasant. The new Premier Custom Tartan Fountain from Parker Pen—an F-Nib with an 18K gold and rhodium-plated tip—is one smooth operator. The Tartan looks as cool as it writes. The lower barrel is lacquered in a brilliant deep-black finish with the top trimmed in silver-plate. The grooved and chiselled cap is modern and elegant. Barrel and cap are perfectly balanced for your hand. It’s a big pen so smaller hands may take time getting used to it. Cursive writing is an art to some and a chore to others. Pens such as the Custom Tartan allow you to be expressive with your writing style. You’ll find yourself wanting to write more often. If your next tome doesn’t make the New York Times Bestseller List, at least it will look amazing. $375 (fountain version) $195 (ballpoint version) www.parkerpen.com 76 TABLE OF CONTENTS Penclic Bluetooth Mouse B2 The owner’s manual of any product is a bane for me. I believe I should be able to open the box, take out the product, and use it right away. It should be intuitive. With Bluetooth Mouse B2 from Penclic, I had to use the manual. Penclic 1, Akash 0 It’s not like any mouse you have used before—if you didn’t know it was a mouse, you’d think it was the stand from a chained bank-pen. The B2, sharp learning curve and all, aims to make mouse-caused carpal tunnel and other repetitive-strain injuries less common. There are buttons galore, everything for right/left clicking to page/webpage scrolling and control. The pen design places your hand in the most comfortable position during cursor navigation, whether you are a rightie or a leftie. The pen moves in a swing-boom fashion and spins freely on a sliding base. A scroll wheel moves the screen cursor up and down, fast or slow. The Bluetooth connection means you can sync it with your Bluetooth-compatible desktop or laptop without connecting a USB dongle. The unit itself charges the included AAA battery from a standard USB outlet with the included mini USB cable; its small The Society of Notaries Public of British Columbia Photo credit: Jaslyn Thorne Fall Tech Trio base size (1.5" x 2.5") is perfect for desktops with little real estate. I mentioned the sharp learning curve and it’s true; you’ll need to pull out the manual for this one. Your reward is a mouse that once mastered, feels natural and intuitive. The tracking is accurate and the buttons have a smooth, solid feel to them. MSRP $99 http://www.penclic.se/en/ 2013 Toyota FJ Cruiser Winter is coming. It’s time to get ready for some of the best off-road driving in Canada. Choosing the right “gear” for off-roading is important and no piece of equipment is more important than the metal sitting on four tires. Toyota’s FJ Cruiser is the Japanese company’s most capable sans-pavement traveller. You can travel fast with the 260 hp 4.0-litre V6 engine and the 271 pound-feet of torque will glide you up the hills. While you might have to get out occasionally to check the depth of the stream you’re driving into, you won’t have to pump gas often— the 2013 model delivers an estimated 16.6L/100 km (17 mpg) city and 13.5L/100 km (21 mpg) Volume 22 Number 3 Fall 2013 Who Will See Your Ad in The Scrivener? highway fuel economy in 4WD automatic guise. The cyclone pre-air cleaner under the hood is effective at trapping sand and dirt. Putting the power to the dirt/ gravel/pavement/driveway are 16inch Toyota Racing Development (TRD) wheels sporting 265/75ZR16 All‑Terrain tires. You won’t mistake the FJ Cruiser for anything else on the road. The retro styling is both functional and smartlooking. The two front doors open wide to allow access to the two rear-hinged doors, giving access to the back seats. Seating is for five, albeit a little tight on the hips. While you’re towing 2272 kg (5000 lbs), you can enjoy the—well— minimalist interior. Despite the rubber and plastic-cladding inside, don’t hose down the cabin. Outside views include a new colour scheme for the Trail Teams Special Edition or the new Magma Red paint. My tester was sedate Cement Gray. The now-standard power outside mirrors have illuminated markers. The FJ includes Toyota’s STAR Safety System—a combination of Vehicle Skid Control and antilock brakes with electronic brake-force distribution and brake-assist. Should you and an immovable object—a tree, for example— get cozy, the side-curtain and front-seat side-impact airbags and dual-stage airbags up front will cushion the hit. 2013 Toyota FJ Cruiser 4WD automatic ($34,440) 4WD manual ($33,440) www.toyota.ca s Vancouver Notary Akash Sablok, AJAC (Automobile Journalists Association of Canada), practises with his father Tarlok Sablok. Akash writes regular technology and automotive columns for several publications across Canada and appears as a guest technology reviewer on TV programs including CityTV’s Breakfast Television (BT Vancouver), Omni Television (BC), TELUS TV – MyTelus: Vancouver Edition; and Shaw TV’s The Rush with Fiona Forbes. He is a regular presenter on CTV’s Morning Live. [email protected] •Lawyers • BC Notaries •Land Appraisers •Land Surveyors of BC • Real Estate Professionals •Real Estate Boards and Associations • Age-Friendly Designates • MLAs and MPs in BC •Life Insurance Brokers and Agents •Accountants •Managers of Financial Institutions •Provincial/Federal Court Judges •Registrars •Mayors • Government Ministries •Libraries: Public and Private, including Law Society, Legal Services, Education Facilities •Investment Management Agencies • Chambers of Commerce • BC Housing • BC Assessment • BC Buildings Corporation Quarterly Press Run: 12,000 Winter Advertising Deadline: November 12 www.notaries.bc.ca scrivener@society. notaries.bc.ca 604 985-9250 Volume 22 Number 3 Fall 2013 The Scrivener TABLE OF CONTENTS 77 Simon Manvell married Sarah Christie on May 19 at Furry Creek. The bride tells us, “Just as I walked down the aisle with my dad, the dark clouds opened and the sun beamed down. It was a gorgeous day to join a Canadian and a South African into one family!” Photo credit: Emily Schnoor News from Victoria Notary Sabrina Hanousek: “Taking over from little Meg who went to doggie heaven in January, Bennie and Rudi are the latest guard dogs and greeters at Notaries on Douglas (NOD). Born in May, the winsome brothers enjoy the clients and are fine with the Notary-office chaos!” PEOPLE Photo credit: Janine, Intuition Photography Honours & Events Kirsten Mitchell in the Regional US Dressage Federation Championships at Donida Farms, Auburn, WA. The recent event capped a successful Summer of competition for Kirsten and her horse Lady of the Dance. Where in the World Has The Scrivener Been? With Notary Tiah Workman in Singapore With Tiah Workman in the Galapagos 78 TABLE OF CONTENTS With Notary Dorothy Clarkson on a motorcycle travelling 4000 miles around Peru With future Notary George Watts at the park The Society of Notaries Public of British Columbia With lawyer Trevor Todd in Russia Volume 22 Number 3 Fall 2013 BY THE NUMBERS Over 800 ,000 10,000 The choice of over conveyancing legal professionals transactions annually 3 Conveyancing solutions The Conveyancer, Brief Convey, ProSuite Surveyed 92.4 % 2.2 million invested in our products in 2012 & 2013 625 lender forms added/or updated at no additional cost in 2012 1000+ Referrals since May 2011 from 400 individuals willingness to recommend* 421 webinar sessions since we started offering free training in 2010 450+ in-firm sessions since January 2011 % trust* 1000+ 1:1 training sessions since January 2011 90.4 26 seconds – average call wait time in 2012 7 strategic partnerships that provide additional value to our customers 91.2 % reliability* 33,597 support calls handled in 2012 22.7 % of our staff dedicated to customer service * Survey Results: Customer Experience Index (2012) www.doprocess.com Sales & Customer Suport Toll Free 1.866.367.7648 E [email protected] E [email protected] ©2013 Do Process LP. Do Process Software, The Conveyancer and Pro-Suite Software Ltd. are registered trade-marks owned by Do Process LP. Brief Convey is a trade-mark of Do Process LP. All rights reserved.