The importance of title examination

In the context of a real estate transaction in Quebec, the examination of property titles is a crucial step. This process, carried out by a notary, ensures that the seller has the legal right to sell the property, and that the property is free of any charges. The goal is to protect the buyer by verifying that the title is valid, and that the buyer will not face legal or financial issues.

When a property is sold, the notary conducts a title examination, which involves reviewing the property’s history based on available documentation, including notarial acts, public records such as the Quebec Land Register, and other legal documents. This examination confirms that the property is duly registered and that there are no undisclosed claims, hypothecs (similar to a mortgage or lien in other legal systems), servitudes, or other charges that could affect the property.

The notary verifies several key elements, including:

• The chain of titles: Ensuring that the seller is the rightful owner and that all previous transfers of ownership are valid and free of irregularities.
• Rights and charges: Identifying any hypothecs, servitudes, or rights of way that may affect the property.
• Municipal and school taxes: Confirming whether they are up to date or if there are outstanding amounts. The notary ensures that any arrears are paid and that the accounts are settled as of the transaction date.
• Legal hypothecs: Verifying that no creditor has registered a legal hypothec against the property. If any exist, the notary ensures they are cancelled.

If any irregularities are detected, the notary can take steps to correct them before the sale is completed.

In addition, buyers may opt for title insurance, which protects them against potential third-party claims on the property’s title after the purchase.

In summary, the examination of property titles in Quebec is an essential step in securing a real estate transaction and preventing future legal complications for the buyer.

This article was written in collaboration with Mtre Natalie Semaan, notary at Blanchard Lupien Notaries LLP.