OREA Ontario Real Estate Law 4 — Questions and Answers
Question 1: Under Ontario law, what is 'specific performance' in the context of real estate?
- A performance review of the real estate agent
- A court order requiring a party to complete the transaction as agreed in the contract (Correct answer)
- A clause that specifies the closing date
- A guarantee of property performance standards
Correct answer: A court order requiring a party to complete the transaction as agreed in the contract
Specific performance is an equitable remedy where a court orders a party to fulfill their obligations under the contract. It is commonly available in real estate because each property is considered unique and monetary damages may be inadequate.
Question 2: In Ontario, what is a 'severance' under the Planning Act?
- The termination of a real estate contract
- The division of a parcel of land into two or more parts, requiring approval from the Committee of Adjustment or Land Division Committee (Correct answer)
- The separation of a partnership between real estate agents
- The removal of a lien from property
Correct answer: The division of a parcel of land into two or more parts, requiring approval from the Committee of Adjustment or Land Division Committee
A severance (also called consent) under the Planning Act allows the division of a parcel of land into smaller lots. It requires approval from the local Committee of Adjustment or Land Division Committee to ensure compliance with planning policies.
Question 3: What is the 'Ontario New Home Warranties Plan Act' (now Tarion) and what does it provide?
- Insurance for real estate agents
- Warranty protection for buyers of new homes covering defects in work and materials, including deposit protection (Correct answer)
- Property tax rebates for new homeowners
- Mortgage insurance for high-ratio mortgages
Correct answer: Warranty protection for buyers of new homes covering defects in work and materials, including deposit protection
The Ontario New Home Warranties Plan Act (administered by Tarion) provides warranty coverage for buyers of newly built homes. It covers defects in work and materials, major structural defects, unauthorized substitutions, and includes deposit protection.
Question 4: Under Ontario law, what is the purpose of a 'real property report' or 'survey'?
- To appraise the property's market value
- To identify property boundaries, building locations, easements, and encroachments (Correct answer)
- To assess the property's environmental condition
- To determine the property's zoning classification
Correct answer: To identify property boundaries, building locations, easements, and encroachments
A survey or real property report prepared by a licensed surveyor identifies property boundaries, the location of buildings relative to boundaries, easements, rights-of-way, and any encroachments that may affect the property.
Question 5: In Ontario, what is a 'subdivision agreement' under the Planning Act?
- An agreement between two property owners to share a driveway
- An agreement between a developer and the municipality setting out conditions for developing a plan of subdivision (Correct answer)
- An agreement to subdivide a condominium unit
- A contract between a buyer and seller for a subdivided lot
Correct answer: An agreement between a developer and the municipality setting out conditions for developing a plan of subdivision
A subdivision agreement is entered into between the developer and the municipality, specifying the conditions that must be met for the subdivision to proceed, including requirements for roads, services, parkland dedication, and other infrastructure.
Question 6: What is the 'Expropriations Act' and how does it affect property owners in Ontario?
- It allows property owners to expand their lot boundaries
- It governs the process by which government can compulsorily acquire private property for public purposes, with fair compensation (Correct answer)
- It only applies to commercial property seizures
- It allows municipalities to increase property taxes
Correct answer: It governs the process by which government can compulsorily acquire private property for public purposes, with fair compensation
The Expropriations Act sets out the process by which government bodies can acquire private property for public purposes such as road widening or infrastructure projects. Property owners are entitled to fair compensation and have the right to a hearing.
OREA Ontario Real Estate Law 4
Under Ontario law, what is 'specific performance' in the context of real estate?