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If you have questions that are not answered below, or if you need further clarification or information, please contact
LAWPRO®'s Customer Service department toll-free at 1-800-410-1013, 416-598-5899 in Toronto
or at service@lawpro.ca.
About the Real Estate Practice Coverage Option
 Who has to apply for this real estate practice coverage?
Any LAWYER who intends to practise REAL ESTATE LAW in Ontario
in 2010 must be ELIGIBLE for,
apply for, and be granted this additional coverage before being able to practise REAL ESTATE LAW.
"REAL ESTATE LAW" is a broadly defined term and is not limited to specific types of transactions, such as transfers or charges. Rather, the term is defined as follows:
REAL ESTATE LAW means the practice of the law of Canada, its provinces and territories, that concerns:
- the registration of any instrument under the LAND TITLES ACT; and/or
- the actual or contemplated transfer, charging, insuring, or otherwise affecting, an estate, right or interest in land;
and may include, without limitation, any one or more of the following services by a solicitor: the receipt of instructions, preparation of documents, searches and/or the providing of one or more opinions or certificates with respect to the title, transfer or charge, and/or with respect to the issuance of any title insurance policy.
Given that title insurance provides coverage for fraud, and that most transactions are now title-insured, why do we need this new Real Estate Practice Coverage -- and why do LAWYERS have to pay this additional premium?
Fraud may take many forms, and may take place regardless of the type of transaction or whether any or all of the parties acquiring an interest in the land happen to be title insured.
With the requirement that all ELIGIBLE LAWYERS who intend to practice REAL ESTATE LAW in Ontario purchase this coverage, the public and Land Titles Assurance Fund are assured of protection against the effecting of registration of fraudulent instruments under the LAND TITLES ACT where there is no title insurance to respond.
Consider, for example:
- The involvement of LAWYERS on either side of a transaction, in instances involving opinions on title;
- LAWYERS acting for the vendor or transferor on title insured transactions; and
- Transactions that are entirely fraudulent in nature, with no opinion or title insurance having been provided.
The Real Estate Practice Coverage responds where the registration causes damages that arise out of any dishonest, fraudulent, criminal or malicious act or omission of the LAWYER. The coverage is specific in its nature, in that:
- It does not apply to other types of circumstances involving fraud;
- It applies regardless of whether there was a retainer between the wronged party and the LAWYER;
- It assures a greater aggregate sub-limit protection than what is purchased by most LAWYERS for innocent party protection; and
- It affords protection even in the instance of sole practitioners, who may not carry any amount of innocent party protection.
What if I decide to change practice at some point during the year and stop practising any REAL ESTATE LAW?
The premium will be pro-rated and adjusted to reflect the amount of time you engaged in real estate practice, subject to:
- A 60-day minimum premium for this option; and
- Only one premium adjustment per LAWYER for this option for the year (beyond this, the full $400 annual premium would apply).
If you cease to practise REAL ESTATE LAW part way through the year and prefer not to continue to carry this coverage,
you should provide LAWPRO with a completed Application for Mid-Term Changes Form within 30 days for any available reduction in
premium to be applied, subject to the criteria above and Return of premium provision described on page 14 of the
Program Guide.
This form is available from our Customer Service department at service@lawpro.ca,
tel. 416-598-5899 or 1-800-410-1013.
If I intend only to practise REAL ESTATE LAW later in the year, do I need to apply for this coverage option now and pay for the whole of the year?
No. If you commence practising REAL ESTATE LAW part way through the year, you will qualify for a pro rata premium adjustment to reflect the amount of time not practising REAL ESTATE LAW, subject to:
- A 60-day minimum premium for this option;
- Only one premium adjustment per LAWYER for this option for the year (beyond this, the full $400 annual premium would apply); and
- the Return of premium provision described on page 14 of the
Program Guide.
If you commence the practice of REAL ESTATE LAW part way through the year, you should be sure to provide LAWPRO with a completed Application for Mid-Term Changes Form at least 10 days prior to the date that the requested change is to take effect. This form is available from our Customer Service department at service@lawpro.ca, tel. 416-598-5899 or 1-800-410-1013.
I practise REAL ESTATE LAW and have the Real Estate Practice Coverage Option. I've just been notified that I am no longer eligible for the coverage. Why have I been advised of this?
Only LAWYERS who are ELIGIBLE to practise REAL ESTATE LAW in Ontario as permitted by the Law Society of Upper Canada are allowed to maintain the Real Estate Practice Coverage Option (subject to Part IV N. Cancellation and Exemption provisions of the policy).
Categories of LAWYERS that are not eligible for this coverage include but may not be limited to:
- those who are in bankruptcy;
- those who have been convicted or disciplined in connection with real estate fraud;
- and those under investigation, where the Law Society obtains an interlocutory suspension order or a restriction on the LAWYER'S practice prohibiting the LAWYER from practising real estate or an undertaking not to practise real estate. You should contact the Monitoring and Enforcement department at the Law Society of Upper Canada directly with respect to further details regarding your eligibility/ineligibility to practise real estate law.
Please note that you are not permitted to practise REAL ESTATE LAW in Ontario for any period during which you do not meet the eligibility criteria according to Law Society records, even though the Real Estate Practice Coverage Option may continue in force for a period of time.
How does this coverage differ from Innocent Party Coverage?
This coverage goes beyond the Innocent Party protection that is carried by many Ontario LAWYERS. It differs from Innocent Party protection in a number of ways, including:
- All eligible real estate LAWYERS must carry this real estate practice coverage - including sole practitioners, who otherwise are not obliged to carry innocent party protection;
- Protection is limited to the registration of fraudulent instruments under the LAND TITLES ACT where the LAWYER is the fraudster or implicated in the fraud, and does not apply to other types of circumstances involving fraud;
- This protection applies regardless of whether there was a retainer between the wronged party and the fraudulent LAWYER;
- The sub-limit protection is $250,000 per CLAIM/$1 million aggregate, ensuring greater aggregate sub-limit protection than what is purchased by most LAWYERS for innocent party protection;
- No protection is provided under this real estate practice coverage for registrations occurring prior to the new coverage coming into force, nor for CLAIMS to which title insurance would apply.
Does this change affect my obligation to buy Innocent Party Coverage?
No. The endorsement providing for the Real Estate Practice Coverage Option accommodates various practice circumstances.
So, if you are a sole practitioner or a LAWYER practising alone in a LAW CORPORATION, you will continue not to have to purchase any amount of Innocent Party coverage. If you are a LAWYER practising in an association, partnership (including general, MDP and LLP partnerships) or LAW CORPORATION (with more than one LAWYER), you will continue to have to purchase the minimum Mandatory Innocent Party coverage without obligation to purchase increased Innocent Party Sublimit protection.
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