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
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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.
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TABLE OF CONTENTS
5
THE CEO/Secretary Of THE SOCIETY
Wayne Braid
ACLF AFDC
ASSOCIATION DES FONDATIONS
DE DROIT CANADIENNES
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 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
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.
•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.
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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
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1081 Cambie Street
Vancouver, BC V6B 5L7
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Phone: 604 687-7432
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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.
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
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Exposure & Marketing Time: Valuation Impacts
Adjustment Support in the Direct Comparison Approach
Residential Appraisal Basics / Commercial Appraisal Basics
Valuation of Property Impairments and Contamination
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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.
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
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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.
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.
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.
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
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afford to spend on a mortgage.
The easy-to-use calculator
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their gross debt-service ratio
(GDS) and total debt-service
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measures in assessing their
financially readiness for
homeownership. The Debt
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Estate
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•Recognizing the increasingly
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access to CMHC’s extensive
housing information. The
app can be downloaded
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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
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For more than 65 years, CMHC
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heartandstroke.bc.ca
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Referrals Welcome.
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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]
COVER STORY: MORTGAGES
The Evolution
of Mortgage
Brokering
in BC
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
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 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.
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
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
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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
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
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.
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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
•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.
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;
•Appraiser Client
•Effective Date
•Assumptions Made
•Appraisal Fee
•Conflict of Interest
•Due Date
•Appraiser’s Certification
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.
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
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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.
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
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?
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
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.
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.
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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.
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©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
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]
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
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
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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)
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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.)
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.)
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.
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
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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.
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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
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
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.
The Scrivener
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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
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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
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
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
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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
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The Scrivener
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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
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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
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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
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The Scrivener
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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 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
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.
KABAN
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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
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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
Education Society of BC, I have been
involved in the education of lawyers
for more than 30 years.
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.
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 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
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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
(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!
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
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
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]
$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
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.
•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
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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.
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.
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
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
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]
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
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.
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!
That reality can be
changed—one spoonful
at a time.
TAMMY MORIN NAKASHIMA
Notary Public
Phone: 604 275-0070
Fax:
604 275-0080
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
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
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.
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.
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
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
Telephone: 604 988-7401
[email protected]
The Scrivener
TABLE OF CONTENTS
61
MAKING A DIFFERENCE
Cathy Grant
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.
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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.
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.
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]
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.
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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
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
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.
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
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.
Thanks again!
Mary-Ann MustonenHinds, Notary Public
mustonen.notary@
gmail.com
We Love to Hear From You!
[email protected]
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.
•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.
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.
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.
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.
[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
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ForXander.
more inFormation on
hoW For
to Leave
a Legacy:
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...
(604) 320-0505
Call (604)Call
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or
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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
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.”
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
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
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.
•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.
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
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)
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
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Institutions
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Judges
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•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
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
With lawyer Trevor Todd in Russia
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INSIDE: Mortgages

Transcription

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