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This page provides general legal information about builders' liens under Nova Scotia's Builders’ Lien Act, including what liens are, and how to register, enforce and dispute them. A lien is a remedy - it is a type of security. Anyone who performs work on, or supplies materials to, someone else’s land, has a right to register a lien against that land as security for getting paid. Liens are commonly registered by contractors on a variety of construction projects, including building and renovating homes.
Once registered at the appropriate Land Registration Office, a builder’s lien affects the owner’s interest in the property, and can interfere with selling or mortgaging the property.
This information is not intended to replace legal advice from a lawyer. Liens are very technical and complicated. We recommend hiring a lawyer if you are considering registering a lien, or if a lien has been registered against your property.
What is a lien?
A lien is a remedy for anyone who supplies materials, provides services, or performs work that improve someone else’s land. Each province has its own lien legislation that gives this remedy to suppliers and contractors, and each law is slightly different. This information page only discusses Nova Scotia’s law, so if you have done work on a property outside Nova Scotia, you must look at the the legislation in that province, territory or other place.
Liens aim at filling a gap in the common law (law from court decisions) that negatively affects contractors and suppliers on construction projects. Often suppliers and contractors will perform work on a property but will not get paid for that work. Suppliers and contractors have a common law claim for breach of contract against whoever they had a direct contract with. That is, they could sue whoever agreed to pay them for their work. But, often the owner of the property was not the one they had a contract with and not the one who agreed to pay them. Rather, their agreement may be with another contractor who was supervising their work on the project (this type of contractor is called a general contractor).
It is very common in construction projects, and particularly larger projects such as building a new home from scratch, to have what is called a ‘construction chain’ where the owner contracts with a general contractor, who in turn contracts with sub-contractors, who in turn contract with sub-sub-contractors and suppliers (see figure).
This construction chain can create a situation where a sub-contractor performs work on a project but is not paid by the general contractor for the work. This could be for a number of reasons - like the general contractor is not well organized, or because they are bankrupt or insolvent. Whatever the reason, while the sub-contractor has a valid breach of contract claim against the general contractor because she has a direct contract with them, she does not have any common law claim against anyone else in the construction chain, such as the owner, even though her work helped improve the owner’s land. This applies in a similar way to sub-sub-contractors: they may have a direct contract with the sub-contractor, but not the owner or general contractor, even though their work improved the owner’s land and helped the general contractor get the work done well and on time.
That is where liens under the Builders' Lien Act come in. A lien allows the unpaid contractor or supplier to register a lien against the owner’s property in the amount they say they are owed for their work, and then claim the outstanding amount from the owner and anyone in between them and the owner in the construction chain. The lien acts as security for payment in that, once registered against the owner’s property, it interferes with the owner’s ability to sell or mortgage the property. Typically, property owners are unable to refinance or sell their property without first removing the lien from the property by paying the contractor who registered it. Liens therefore provide a useful tool for contractors and suppliers to pursue payment for work they have done on a property.
For contractors, subcontractors, suppliers and labourers
Who can file a lien?
A lien may be filed by anyone who worked on, provided services, or supplied materials for a certain property. This typically includes:
- a general contractor
- subcontractors, sub-sub-contractors, etc
- suppliers; and
Court decisions say that liens may also be filed by architects, engineers, and surveyors as long as their work or services directly relate to the specific piece of land.
If you do not fall into one of these categories, speak to a lawyer. There may still be a way for you to register a lien, or another way to make a claim for money owed.
Before you start - basic steps to bring a lien claim
Time limits are very important in making a lien claim. You must strictly follow the timelines and requirements for registering liens, and for proving a lien claim. The timelines are in the Builders' Lien Act. If you miss a deadline you may not be able to put a lien on the owner’s property, and you will not succeed in proving your lien claim.
There are several steps to bring a lien claim:
Step 1. Register the lien against the property at the Land Registry
Step 2. Start a legal action in the Supreme Court of Nova Scotia against everyone above the contractor or supplier in the construction chain
Step 3. Register the action with the Land Registry.
The next three sections discuss each step, and the strict timelines and requirements under each step. Steps 2 and 3 must be done at the same time.
Before registering a lien contractors should also think about whether registering the lien may prompt the owner to bring their own action against you about the work you performed. For example, they may allege that your work was defective and they had to pay another contractor to fix it, and claim against you for the costs of hiring the other contractor. It is therefore important to consider:
- are there any possible deficiencies in your work that would cause the owner to claim against you?
- whether the risks of starting a lien claim are worth potentially triggering a counterclaim that could exceed the amount of your lien claim.
Of course, an owner may still claim against you even if you do not register a lien. However, filing a lien often prompts an owner who was otherwise willing to move on to file a claim.
Step 1 How do I register a lien?
First, you must register the lien against the property at the appropriate Land Registry.
You must register the lien within 60 calendar days after the last day the contractor worked on or delivered materials to the property.
It is vitally important to record each day you work on a project and the nature of the work you performed that day, as you will need to know the last day you worked on a project in order to know when the deadline for registering your lien will expire. Court decisions have said that the last day of work does not include work performed to fix or repair work that has already been done.
Speak to a lawyer if you think the land you improved is government-owned, as liens may not attach to certain government-owned property.
If you are within the timeline for registering the lien, you must file two documents with the Land Registry:
- Claim of Lien for Registration form, and
- an Affidavit (sworn document) in support of the lien. You will need to get a lawyer, notary, or commissioner of oaths to take your affidavit before you can submit it.
The claim must include:
- a description of the work done or the services or materials provided
- amount claimed
- last day work was done and/or materials supplied
- a description of the property to be charged (exact address). If possible, get the Parcel Identification Number (“PID”) for the property and include that in your description of the property.
You should hire a lawyer to help you draft and file these documents to make sure you have included all the necessary information.
Once you finalize these two documents, contact the Land Registry. Ask them to register the documents against the property you have described in the documents. There is a fee for doing so. Once registered, the Land Registry will give you a copy of a confirmation page showing that the lien has been registered against the property.
Land Registration Offices are listed in the government pages of the telephone book under Land Registration, or visit: novascotia.ca
Once registered, you must give notice of the lien to all people/companies named in your lien. Do this by sending each of them a copy of your Claim of Lien for Registration, Affidavit, and the Land Registry’s confirmation page showing that the lien has been registered. Give this notice as soon as possible, and keep a record for your files.
The lien takes effect from the date of registration and has priority over subsequent purchasers, mortgagors and other encumbrances of the land. However, prior encumbrances, such as mortgages who have advanced money under their mortgages before the lien was filed, will still have priority over the lien. Regardless of who files their lien first, all lien claimants of the same class (that is, all subcontractors working for a specific general contractor or all sub-subcontractors working for a specific sub-contractor) are treated equally and recover pro rata.
How long do I have to register a lien?
You have 60 days from your last day of work, or the last day you supplied materials, to register your lien at the appropriate Land Registration Office.
After the 60 days you can no longer register a lien, but you may still be able to sue the person who owes the money in either Small Claims Court or the Supreme Court of Nova Scotia for the amount of money you are owed.
Where do I register a lien?
Your lien must be filed with the Land Registration Office in the county where the property is located. There is a fee for this service. You may require a lawyer to register your lien at the Land Registration Office. Local Land Registration Offices are listed in the government pages of the telephone book under Land Registration, or visit: novascotia.ca/sns/access/land/land-registry.asp
Step 2 How to start a lien action
Once your lien has been registered and you notify the owner of the property, the owner may simply pay you the lien amount or ask their general contractor to do so. They may also want to discuss settling with you for a lesser amount. They may also tell you that they do not agree with the amount you are claiming, and/or may argue that your work was deficient and therefore you are not entitled to payment.
No matter how the owner responds (if at all), if you do not get paid, you have to file a lien action in order to preserve your lien. This is called ‘perfecting’ the lien. Specifically, you must file a Statement of Claim with the Nova Scotia Supreme Court within 105 calendar days of the last day of work in order to perfect the lien and prevent it from expiring. There is a fee for doing so.
The 105 calendar days starts running from the last day of work, not from the date that you register your lien. Any negotiations you are in with the owner will not stall or change this deadline in any way, so be sure to keep close track of it.
The Statement of Claim must set out all the facts that you will need to rely on to prove your claim, the causes of action you have against the defending parties, as well as the amount of damages you are claiming. You should hire a lawyer to help you draft and file the Statement of Claim, as there are a number of rules around what must be included in these types of documents, and also what is not proper to include. It may be possible to claim breach of contract or other causes of action in addition to making a lien claim, which is a complicated decision that you will likely need a lawyer to help you with.
You will need to file several copies of the Statement of Claim- one for the court, one for you, and one for each of the other parties you are claiming against. The court will stamp all the copies when you file them. The court will keep one copy and give you the rest. You must then 'personally serve' these copies on each of the parties. You must do that within 30 days of filing. Personal service means the document must be handed to the person and the person must identify themselves. Personal service cannot be done by mailing documents to someone, or using a courier, fax, or registered mail. If the person being served has a lawyer, that lawyer may accept service for their client. You should check with the lawyer to make sure they will accept service of the documents. To serve a company, you have to hand the document to the Recognized Agent for the company.
If you do not want to personally serve the parties yourself, you can hire a process server to do it for you. Professional process servers may also be called 'bailiffs.' You will have to pay a fee for this service.
Step 3 Register the lien action
The lien action that you file with the Nova Scotia Supreme Court must be registered with the Land Registry in order for your lien to be perfected. You must do this within 105 days of the last day of work. Your lien will expire if you do not register the lien action with the Land Registry.
To register your lien action with the Land Registry, you must draft a document called a Certificate of Lis Pendens. A Certificate of Lis Pendens is a document that says a lawsuit to perfect the lien has been properly started. You must file the Certificate of Lis Pendens with the court at the same time as filing your Statement of Claim. The court will stamp and sign the Certificate of Lis Pendens, which you must then register with the Land Registry.
I want to register a lien but I am being told that I agreed I would not register one, what do I do?
The Builders' Lien Act says that unless you are a manager, officer or a foreman, a spoken or written agreement that you will not exercise your right to make lien claim is null and void. This means that you cannot give up your right to make a lien claim. You might voluntarily choose not to register a lien but no one can stop you from making a lien claim by insisting that you, or someone on your behalf, agreed beforehand not to make a claim.
What is a holdback?
The law requires owners and each contractor in the construction chain to keep or ‘hold back’ 10 percent from each payment they make to every contractor and sub-contractor. This percentage is known as the holdback. All the amounts held back by all of the owners and contractors in the chain form what is known as the lien fund. The lien fund is the pool of money that lien claimants can resort to if they are not paid.
The holdback must be held for 60 days after the work has been ‘substantially performed’. Work is deemed to be substantially performed under the Builders' Lien Act when
(1) the work or improvement is ready for use or is being used for the purpose intended; and
(2) the work to be done under the contract is capable of completion or correction at a cost of not more than two and one-half per cent of the contract price.
Once these two requirements have been met, the owner/contractor must release the holdback to the contractor/supplier(s) below them in the construction chain.
If after substantial performance there is still some work to be done on the property to make sure that it is 100 percent completed, the owner/contractor is then required to hold back 10 percent of the value of that remaining work. This “finishing holdback” must be retained until 60 days have passed from the date of ‘total performance’ (i.e. when the project is 100 percent complete).
Subcontractors may apply for the early release of part of the holdback if they finish their work on a specific aspect of the project before the entire project is complete, and they want the remaining 10 percent of their money as soon as possible. To do this, subcontractors must get the consultant on the project to certify that they have substantially performed the contract. If there is no consultant, then the owner and the general contractor have to jointly certify that the work has been substantially performed. 60 days after certification of substantial performance (assuming no liens related to that subcontractor’s work are filed), the owner can then reduce its project holdback by the amount of the subcontractor’s holdback and release that amount to the general contractor. The general contractor can then release that same amount to the subcontractor.
Owners must give notice that the general contractor has reached substantial performance of its contract. Specifically, owners are required to post notice on the Construction Association of Nova Scotia website and also at the jobsite in a prominent location. However, these notice requirements do not apply to property that is:
(1) owned and occupied by the owner and/or their spouse or common-law partner;
(2) for single family residential purposes; and
(3) where the value of the work is for $75,000.00 or less.
What do holdbacks have to do with my lien claim?
An owner or contractor’s liability to sub-contractors further down the construction chain with whom they do not share a contractual relationship is capped at the holdback amount of 10 percent. Therefore, when a lien claim is made by anyone other than the general contractor, the holdback limits the extent of an owner or contractor’s liability to 10 percent of the payments they have made to sub-contractors, or the amount still owing to the general contractor (for example, unpaid progress payments for work performed).
Can an owner have a lien removed from their property before a trial is held to decide the lien claim?
If the parties settle before the matter goes to trial, the lien will be removed as a condition of the settlement. However, even if the parties do not settle, the owner can still remove the lien from the property before trial. To do so, the owner must post the amount of the lien claim plus 25 percent into court to be held until the claim is decided. The money is typically posted in the form of a lien bond from a surety company, or a letter of credit or certified cheque from a bank. This essentially shifts the security from the property to the court. This is known as ‘vacating’ the lien, and is often done by owners who want to get the lien off their property quickly so they can sell it or finance it. A court application might be necessary in order to vacate the lien, however if the parties consent, the court will typically make an order without the need for the parties to appear in court.
What happens if I miss a deadline, or do not want to make a lien claim?
If you have missed a deadline for registering or enforcing your lien, or if you do not want to make a lien claim at all, you may be able to sue the person or company you have a direct contract with in either Small Claims Courtor the Supreme Court of Nova Scotia for money that is owed to you. If you are suing for under $25,000, you should make the claim in Small Claims Court. This will be a regular breach of contract claim, not a lien claim. This means you will be following the normal processes of either the Small Claims Court or Nova Scotia Supreme Court. If after you get your judgment the person who owes you money doesn’t pay you, you would have to take steps to enforce the judgment. See, Enforcing a Small Claims Court Order: A Guide for Creditors at courts.ns.ca
What is a breach of trust claim?
If you missed a deadline and you can no longer make a lien claim you may be able to make a claim for a “breach of trust”. You have to make a breach of trust claim in the Supreme Court of Nova Scotia regardless of whether the claim is for less than or more than $25,000, as Small Claims Court cannot deal with breach of trust claims. You will most likely need a lawyer to make a breach of trust claim for you.
The law says that money an owner gets to fund a construction project is held “in trust” for the benefit of contractors on the project until it is paid to the contractors. This means that even though the money is in the owners’ hands, the law trusts that the owner will hold this money for the contractors. If the owner does not pay the contractors this money they can be said to have broken this trust agreement and the court may find that they have committed a “breach of trust”.
Similarly, the law says money a contractor or a subcontractor gets for other subcontractors, labourers and/or suppliers is held in trust for other subcontractors, labourers and/or suppliers even though the money is in the hands of the contractor or subcontractor. If the contractor or subcontractor uses the money for their own purposes and fails to the pay the subcontractors, labourers or suppliers, the court may find that they have committed a breach of trust.
Courts have said that the duty of the trustee to preserve the trust fund for the benefit of workers and suppliers is an ongoing one and does not end until all work has been completed and all workers and suppliers have been paid amounts owing by the trustee. However, this obligation is only owed to those people directly below the trustee in the construction pyramid. That is, the only beneficiaries of the trust are those who have a direct contract with the contractor who owes them money. The courts have said that once a contractor has paid those directly below her in the construction pyramid, she has fulfilled her trust obligations. Bringing a breach of trust claim in Supreme Court may be particularly important where you have missed deadlines and cannot bring a lien claim anymore or where the person who owes you money might be declaring bankruptcy.
Do I need to hire a lawyer?
This can be a complicated area of law. It is a good idea to hire a lawyer for advice about registering and enforcing a lien.
A lawyer can help you:
- decide whether it is worth it for you to file a lien
- prepare your affidavit, which is a sworn statement by you attesting to the truth of your claim. The affidavit must accompany your claim form when you first register your lien
- accurately fill out and file the appropriate forms
- follow the time limits in the Builders' Lien Act
- assist you with a breach of trust claim, or
- negotiate payment, possibly avoiding the time and cost of going to court.
If negotiations are not successful, you will likely need a lawyer to handle the proceedings through the Nova Scotia Supreme Court. A lawyer can also give you advice on whether you should go ahead and sue on your own in Small Claims Court instead of making a claim for a lien. You can sue in Small Claims Court if you are asking for less than $25,000. However, you will not be making a lien claim, you will just be suing for money. You are allowed to represent yourself in Small Claims Court.
For property owners
Can a person register a lien if I did not hire them?
Yes. Liens are available to contractors as a remedy precisely because contractors do not have a direct contract with the property owner that would provide them with a common law remedy for breach of contract. A lien claimant may register a lien even if you did not directly hire them to work on your property. They may have been hired by your contractor, or a subcontractor.
For example: You hired a general contractor to build your house, and have been making regular payments to him. Your general contractor subcontracted an electrician to do the electrical wiring in your home, but failed to pay her for the work. The unpaid electrician can register a lien against your property. Equally, if the general contractor paid the electrician, but she did not pay her employee who worked on the project with her, the electrician’s employee can register a lien against your property.
Can a person register a lien if I dispute the debt?
Sometimes there are disagreements about the quality of work done on a property. There may be deficiencies in the work, or the amount claimed under a lien is disputed. Disputes over the quality or completeness of the work done do not interfere with a contractor’s right to register their lien against your property and file a lien claim in Supreme Court.
Ultimately it would be up to the court to decide, after hearing from all sides, whether the lien claim is valid and how much money is owed, if any.
How do I defend against a lien claim?
As noted above, the contractor has to register their lien with the Land Registry no more than 60 days after their last day of work on the property. From there, they have to file a Statement of Claim with the Nova Scotia Supreme Court, and file a Certificate of Lis Pendens with the Land Registry, within 105 days of the last day of work.
An owner who thinks that the lien is not valid for some reason can defend the lien claim by filing a Notice and Statement of Defence (see How to Defend an Action) with the Nova Scotia Supreme Court. In that Defence, the owner should explain the significant facts and explain why they think the lien claim is invalid.
If possible, owners (or general contractors on behalf of owners) should keep track of what contractors are on their property and when. This may enable them to challenge the lien claim on the basis that the contractor failed to meet one of the deadlines set out under the Builders' Lien Act. One of the easiest ways to defend a lien claim is to state that the lien claimant did not register their lien within 60 days of their last day of work on the project. If the owner is confident about that argument, they could even file a motion to discharge the lien on that basis alone. Courts apply the deadlines set out under the Builders' Lien Act very strictly.
How do I have the lien removed from my property once the claim is decided or settled?
If you settle with the contractor before a law suit (action) has been started you may have a lien removed from your property by registering a Receipt in Discharge of Lien signed by the lien claimant with the Land Registry. However, if an action has been started, then you must file a Consent Dismissal Order with the court, and then register a Discharge of Lien and Affidavit of Verification with the Land Registry.
If a lawsuit has already been started the court will decide whether or not the contractor, subcontractor, labourer or supplier is entitled to the money they are asking for. If you want the lien removed from your property before the court decides the case, you would need to apply to the Supreme Court to ask for an order to have the lien removed.
An owner can also remove the lien from the property before trial without settling with the contractor. To do so, the owner must post the amount of the lien claim plus 25 percent into Court to be held until the claim is decided. The money is typically posted in the form of a lien bond from a surety company, or a letter of credit or certified cheque from a bank. This essentially shifts the security from the property to the Court. This is known as ‘vacating’ the lien, and is often done by owners who want to get the lien off their property quickly so they can sell it or finance it. A court application might be necessary in order to vacate the lien, however if the parties consent, the court will typically make an order without the need for the parties to appear.
What are my holdback obligations as an owner?
As an owner, you are required to hold back 10 percent of what you pay to the company or person directly below you in the construction chain during construction. This amount that you are holding back is called the ‘lien fund’, and as owner, you are the trustee of that fund. This is the pool of money that lien claimants can resort to if they are not paid.
The holdback requirement is explicitly set out in the Builders' Lien Act, and failure to comply with it could mean that you will be forced to pay double for the same work. If, for example, you pay your general contractor the full amount of their contract price instead of holding back 10 percent, there is a risk that, if the general contractor is unable to pay their sub-contractors, those sub-contractors will seek payment from the lien fund. If you did not keep a lien fund, then you as owner are liable up to the holdback amount to pay any sub-contractors, even though you have already paid the holdback to the general contractor for that work. It is therefore very important for owners to hold back the 10 percent amount to protect themselves from this risk.
The holdback must be held for 60 days after the work has been ‘substantially performed’. Work is deemed to be substantially performed under the law when
(1) the work or improvement is ready for use or is being used for the purpose intended; and
(2) when the work to be done under the contract is capable of completion or correction at a cost of not more than two and one-half per cent of the contract price.
Once these two requirements have been met, the owner/contractor must release the holdback to the contractor/supplier(s) below them in the construction chain.
If after substantial performance there is still some work to be done on the property to make sure that it is 100 percent completed, the owner/contractor is then required to hold back 10 percent of the value of that remaining work. This “finishing holdback” must be kept until 60 days have passed from the date of ‘total performance’ (i.e. when the project is 100 percent complete).
Subcontractors may apply for early release of part of the holdback if they finish their work on a specific aspect of the project before the entire project is complete, and they want the remaining 10 percent of their money as soon as possible. To do this, subcontractors have to get the consultant on the project to certify that they have substantially performed the contract. If there is no consultant, then the owner and the general contractor have to jointly certify that the work has been substantially performed. 60 days after certification of substantial performance (assuming no liens related to that subcontractor’s work are filed), the owner can then reduce its project holdback by the amount of the subcontractor’s holdback and release that amount to the general contractor. The general contractor can then release that same amount to the subcontractor.
Owners mustgive notice that the general contractor has reached substantial performance of its contract. Specifically, owners must post notice on the Construction Association of Nova Scotia website and also at the jobsite in a prominent location. However, these notice requirements do not apply to property that is:
(1) owned and occupied by the owner and/or their spouse or common-law partner;
(2) for single family residential purposes; and
(3) where the value of the work is for $75,000.00 or less.
You should get legal advice about your particular situation.
Do I need to hire a lawyer?
This is a complicated area of law. It is a good idea to hire a lawyer for advice about defending a lien claim, which make include counter-claiming against the contractor for deficiencies that the owner had to pay to repair, negotiating with the contractor, or removing a lien from your property.
Updated: October 2019
Acknowledgments: Thank you to Melanie Gillis at McInnes Cooper for reviewing this content.
Buying a Home
- What should I look for when buying a home?
- Are there things to consider if I am buying in a rural area?
- Are there things to consider if I, buying a newly built home?
- Are there things I should consider if I'm buying a condominium?
- Who is involved in the process of buying a home?
- What is the role of a lawyer?
- What is the role of the real estate agent?
- What should I look for when choosing a lawyer, real estate agent, or financial institution?
- Can I use the same real estate agent, or lawyer as the seller?
- What costs are involved in purchasing a home?
- What should I include in my offer to purchase?
- What happens if the seller doesnt accept my offer?
- What if I or the seller does not satisfy the conditions in the agreement of purchase?
- What is a property condition disclosure statement?
- Does the seller have to tell me about problems such as a flooding basement?
- Should I have a building inspector inspect the home?
- What are restrictive covenants?
- Will my spouse be in included in the deed to the home?
- When should I insure the property and its contents?
- What is title insurance?
- What happens on the closing date?
- When can I move in?
- What is a Parcel Register?
- Is the property migrated?
- What is a location certificate?
- Am I required to register my new home under the new Land Registration Act?
Q- What should I look for when buying a home?
Prepare a needs list by deciding what it is you are looking for in a home in terms of size, bedrooms, location, type of neighborhood etc. Find out from your real estate agent if there are any developments planned for the neighbourhood that might affect your decision to buy. Then try to settle on a price range that you can afford. You will need a down payment usually around 5% of the house price. Do not forget to take into account other costs involved such as home inspection, deed transfer tax, other closing costs and your lawyers fees. Your lawyer will explain these costs to you in advance.
Q- Are there things to consider if I am buying in a rural area?
When purchasing a rural home you should ensure that the drinking water is tested. You should consider having both the quality and quantity of water tested. Most rural homes will be on a well so it is important that you ensure the water is safe to drink before purchasing. Most rural homes are on a septic system, and you will want to have someone inspect this to ensure it is in working order. Also consider how far you have to travel to services such as hospital, schools, work, shopping etc.
Q- Are there things to consider if I, buying a newly built home?
New homes may have fewer maintenance concerns, but there will be different kinds of questions you will want answered. Is it protected by a new home warranty? Have all the required permits been issued? Can copies be provided for your review?
Q- Are there things I should consider if Im buying a condominium?
You should find out what the monthly condominium fee is and what it covers. Are there plans to increase the fee? Have there been any maintenance or repair problems? How much is in the reserve fund to cover future maintenance and repairs? Are most units owner occupied or rented? Can you hear the occupants of the unit overhead or next door?
Q- Who is involved in the process of buying a home?
When purchasing a home, you will require the services of a lawyer, a real estate agent, and most likely financial assistance from a mortgage lender. You may also need the services of other professionals such as building inspectors, land surveyors.
Q- What is the role of a lawyer?
A lawyer will inform you of your legal rights and obligations when you are buying your home. You should have your lawyer review your offer to purchase. Your lawyer should explain the conditions that have to be met before you are legally obligated to buy, and the general terms of the legal contract you have entered into. He or she will also ensure that you understand any ownership interests, limitations of your new home such as restrictions on use of the property or rights of way over the property. Your lawyer will also review documents, ensure that you and the seller sign the documents, ensure that he or she has sufficient funds to complete the closing of the sale, make sure the appropriate searches are done and that any liens or mortgages are paid off on closing, and, following closing, file documents to register your mortgage and you as the new owner of the property.
Q- What is the role of the real estate agent?
A real estate agent provides advice on the type of property which will best suit your needs including balancing your wish list with any budgeting limitations. He or she will prepare the offer to purchase, as well as negotiate on your behalf with the sellers agent. When purchasing a home, the real estate agent has obligations to the seller, so ensure you ask your agent to explain fully the extent that this obligation may limit their duties to you as a buyer.
Q- What is the role of the lender/financial institution lending you the mortgage?
Your financial institution/lenders main role is to provide you with a mortgage to enable you to purchase your home. There are many different mortgage plans with varying interest rates. The financial institution should work with you to decide what kind of mortgage best suits your financial situation and your needs. Some buyers use a mortgage broker to find the best mortgage to suit their needs. A financial institution may give you a pre-approved mortgage enabling you to know for sure what you can afford, so that you can avoid getting your heart set on a home that you may not be able to afford. Dont hesitate to ask any questions you feel will help you decide what kind of mortgage best suits your needs.
Q- What should I look for when choosing a lawyer, real estate agent, or financial institution?
Take the time to understand what the services will consist of. You can ask family, friends or people you work with who they would recommend. Lawyers may have varying rates. You do not necessarily need to chose the first lawyer or real estate agent you approach to represent you, explore your options. Ask whether their practice is for the lawyer to meet with the client for a closing appointment. You should talk with different financial institutions and have them explain the different mortgage options available to you based on what you can afford. They will explain such things as fixed rates, variable rates, and help you determine the best mortgage repayment options. You can also use a mortgage broker to shop around for you.
Q- Can I use the same real estate agent, or lawyer as the seller?
Yes - but is recommended you hire a lawyer or real estate agent that is not representing the seller. This is to ensure that they will solely serve your interests in the home buying process.
Q- What costs are involved in purchasing a home?
Before making an offer to purchase a house, you should ensure that you understand and can afford all the costs of buying the home as well as the purchase price. Here is a list of the usual fees involved when you buy a home. You will want to find out what each is likely to cost so that you can keep to your budget as far as possible. The costs may include:
- A down-payment
- Inspection fees (home inspection and sometimes inspection by an electrician, roofer or other tradesperson)
- Moving costs
- The cost of connecting utilities
- Closing costs: - legal fees - land transfer tax - municipal/ school/ other property tax and fuel adjustments - survey fees, document registration fees
- Renovations or repairs that are required immediately.
Dont forget to budget for insurance on the building and contents from the closing date. Usually, you dont pay your real estate agent as he or she takes a share of the fee paid by the seller to his or her agent.
- any chattels such as a stove, fridge, dishwasher that are to remain with the house when you buy it should be specifically listed in the offer to purchase. Personal furniture items such as curtains, sofas, chairs, paintings etc. are rarely included. If the seller has agreed to include curtains etc. these should also be listed in your offer to purchase.
- any conditions such as the seller having to vacate by a certain time on the closing date, or that the offer is subject to you having it reviewed by your lawyer
- any repairs that the seller needs to complete by a certain date
- whether the offer is conditional on you securing satisfactory financing by a certain date, a home insprection, and/ or the sale of you current home. Your real estate agent and lawyer will help you when you draft your offer to purchase to ensure any concerns you have are properly addressed. If your offer is accepted, you will be expected to make a downpayment to the sellers agent who will hold it until the sale proceeds.
Q- What happens if the seller doesnt accept my offer?
If the seller doesnt agree with the price you offer or with any of the conditions in the offer, he or she can make a counter offer. You then have to decide whether to accept it. You may also be able to make a further counter-offer. If you and the seller cannot reach an agreement then negotiation is at an end and you should look for another property.
Q- What if I or the seller does not satisfy the conditions in the agreement of purchase?
The agreement of purchase is a contract, and therefore it follows the general rules of contract if the terms are not carried out by either party. At any point if one party cannot satisfy a condition of the contract the other party may withdraw from it provided the contract allows the withdrawal for that breach. For example, if you decide not to complete the purchase because you find another house you like better, you might forfeit the down payment (deposit).There will be certain time frames in the offer for conditions to be satisfied. For example, you might have a certain time to get mortgage financing in place, if you cant get a mortgage then you may be able to withdraw from the agreement without paying a penalty. You should tell your lawyer or agent if you cannot meet a condition within the time frame provided.
Q- What is a property condition disclosure statement?
A Property Condition Disclosure Statement is a report that is provided by the seller. It discloses information about the existing condition of the property that is known to the seller. This statement will help the purchaser decide whether further inspections are needed. Review it carefully, and ensure you have all your questions answered to your satisfaction. For example, if the Property Condition Disclosure Statement says that the roof was last replaced 10 years ago, or there was water in the basement last spring, you may want to have the roof inspected to see if it needs repair or replacement and the basement inspected for current and possible future damage.
Q- Does the seller have to tell me about problems such as a flooding basement?
The seller is legally required to disclose what they know about the condition of the property. Specific questions about water leakage should be included in the property disclosure statement. A building inspector can also assess whether there is any evidence of past or present water problems. Again ask questions of your inspector and ensure any information you need is provided to your satisfaction.
Q- Should I have a building inspector inspect the home?
Yes. Purchasing a home is a large investment. You will want to ensure as far as possible that what you are about to purchase will not have any unexpected problems down the road. Hiring a building inspector will help identify any past or already existing problems with the house that may not have been apparent to you when you viewed the property. While it may cost money to have a building inspector look over the house you wish to purchase, the potential cost of not having a building inspected could be far greater.
The home inspector cannot identify every potential problem; however, if you are unsure of a particular aspect of the house such as wiring, structure, the roof etc. you can hire a specific tradesman such as an electrician, roofing specialist etc. to further investigate the part of the house in question. There is usually a time frame set out in your contract for this work to be done. Ensure you are aware of the time frames you have to meet. If the home inspection finds significant or costly problems there may be an opportunity to withdraw from the purchase or to ask the seller to fix or pay all or part of the cost of fixing the problems. Talk to your lawyer and real estate agent if you are concerned about the results of the inspection.
Q- What are restrictive covenants?
Restrictive covenants are conditions that come with the property you are purchasing. They may include such restrictions as size of building on land, prohibition against establishing a business on the property, and many others. Your lawyer will inform you of these covenants upon a review of the state of the title. The restrictive covenants are in place to protect the value of your property as well as the value of homes in your neighborhood. It is important to be aware of them when buying or when selling your home in the future.
Q- Will my spouse be included in the deed to the home?
You should discuss with your lawyer whether you and your spouse should jointly own the property and the options of how you take title to your new home. For example, as a sole owner, joint tenant or tenant in common. If your mortage lender is relying on both your spouses and your income to support a mortgage application, then it will require both names on the deed.
Q- When should I insure the property and its contents?
You should make sure that you have insurance coverage on the property from 12:01am on the day of closing. Your lawyer will require proof that insurance has been arranged in the form of a binder letter from the insurance company. It can be faxed to your lawyer before the closing date.
Q- What is title insurance?
Title insurance is specialized insurance that you should discuss with your lawyer. It provides protection against a number of events. It you choose to have title insurance it is a one time closing expense.
Q- What happens on the closing date?
The closing date is the day that you purchase your property in full and receive possession. Your lawyer will have prepared a closing statement showing all the money due to complete the purchase. You should ensure that you provided your lawyer with a certified cheque or bank draft payable to your lawyer in trust for the balance due from you. Your lawyer will also arrange to receive the mortgage funds from your lender. On the closing date your lawyer transfers the appropriate funds to the sellers lawyer. Your lawyer will ensure other closing costs such as deed transfer tax, legal fees, title search, and location certificate are taken care of. Your lawyer will register your deed and mortgage with the Land Registry Office and forward to you the original deed to the house once he or she receives it from the Registry Office.
Q- When can I move in?
Your purchase agreement may set out the exact time on the closing date that you are able to move in. However this will depend on whether your lawyer has received all the funds necessary to complete the purchase, from both you and the lender. You will complete a final inspection of the property and if this is satisfactory, and your money has been paid, your lawyer will arrange for you to have the keys to your new home.
Q- What is a Parcel Register?
The new Nova Scotia Land Registration system requires the seller to register all the title information in the parcel register at the government land records office. Every parcel register has a number (Property Identification Description or PID) and this number remains the same through all transfers of ownership. Your lawyer will review the details of your parcel register with you before the purchase.
Q- Is the property migrated
All properties that are to be transferred to new owners must be registered or migrated into the new Land Registration system. If the seller has not already done this, it will be set out in the contract that he or she will do it before the transfer is completed. For more information on the new Land Registration Act you can visit the website of the Land Registration Office of Nova Scotia.
Q- What is a location certificate?
A location certificate is a survey conducted by a Nova Scotia Land surveyor. It ensures that the building the seller is selling to you is within the boundaries of the lot. It ensures the property as you viewed it, is within the boundraries of what the owner has to sell.. The company giving you a mortgage will require you to get a Location Certificate to ensure the money it is loaning you is secure. Your lawyer will make the necessary arrangements to have a land surveyor carry out the survey
Q- Am I required to register my new home under the new Land Registration Act?
If the home you are purchasing is not yet registered according to the Land Registration Act, then it must be done before the home can be purchased. The registration process is sometimes called conversion or migration to the new land registration system. There is a fee for registration. It is up to the purchaser and the seller to negotiate who covers the costs involved. The practice has developed that the seller usually pays the cost of registration.Your lawyer will tell you if the property your are purchasing has been registered. Once a property is registered under the new registration system it will not need to be registered again. For more information on registering property and the new Land Registration Act you can visit the website of the Land Registration Office of Nova Scotia.
This page gives legal information about residential mortgages. It does not give legal advice, and does not replace advice from other professionals, such as a credit counsellor, licensed insolvency trustee in bankruptcy, or mortgage advisor. Look at the resources at the end of this section for help if you are having financial difficulties.
Talk with your lender right away if you are having trouble making your mortgage payments.
The process set out below is known as the “simplified procedure”. It applies to most foreclosures. However, the process may be different in your situation.
Foreclosure: a legal process which allows the lender to get ownership of the property and to sell it and use the sale proceeds to pay off the mortgage debt, legal costs, Sheriff fees and other costs.
Lender: A lender can be a bank, credit union, insurance company, private individual, or loan company.
Mortgagor: the borrower, or the person(s) borrowing money from the financial institution.
Mortgagee: means the lender, or the financial institution lending you money.
Mortgage a loan agreement or contract between a borrower and lender, where the borrower’s property is promised as security for the loan. Mortgages can take many forms and can be taken by a mortgagee to secure obligations of the borrower whether or not the money being borrowed is for the purchase of the property. Here, we are talking about a mortgage as a way to borrow money using the home you are buying as security for the loan.
|Usual steps in a foreclosure
|1. Default||Borrower defaults on mortgage|
|2. Demand Letter||Lender sends Demand Letter to borrower|
|3. Notice of Action and Statement of Claim||If demand letter fails, the lender starts legal proceedings and serves the borrower, in person, with court documents starting the foreclosure process (Notice of Action & Statement of Claim)|
|4. Defence||After getting the Notice of Action and Statement of Claim, the borrower files a defence or applies to court for other relief within: 15 business days, if served in Nova Scotia; 30 business days, if served in Canada, but outside Nova Scotia; 45 business days, if served outside Canada.|
|5. Motion to Court for Order for Foreclosure, Sale and Possession||If no agreement is reached, and no defence is filed within the required time after Notice of Action and Statement of Claim is served on the borrower, or any defence is unsuccessful, the lender makes a Motion to court for Order for Foreclosure, Sale and Possession|
|6. Order for Foreclosure, Sale and Possession issued by court||Court grants Order for Foreclosure, Sale and Possession|
|7. Notice of sale of the property at Public Auction||Notice is published twice in a local newspaper, with a copy sent to borrower by regular mail at the mortgaged property (or last known address if different from mortgaged property) at least 15 days before sale|
|8. Sheriff’s sale of the property by Public Auction||Property is sold at a public auction in the county where the property is located. Generally, homeowner (borrower/mortgagor) should be ready to move out on the date of the public auction.|
|9. Claim for Deficiency or Surplus after the sale||Application(s) to court to deal with any deficiency or surplus based on the proceeds of sale.|
|10. Confirmatory Order||The lender obtains an order from the court confirming that the foreclosure is complete|
Most people who buy a home need to borrow money from a bank or other financial institution to help cover the purchase price of the home. Usually the loan is secured by a mortgage on the property. If you default on your mortgage your lender may take legal steps to foreclose on your property.
Default means you have broken the mortgage terms. The most common default is not making mortgage payments when they are due.
Failure to make mortgage payments is not the only form of default. Mortgages have many promises the borrower must follow. Breaking any of these promises can be a default. Some mortgages even allow the lender to demand repayment of the mortgage in full and subsequently foreclose at any time at their discretion without default.
Most mortgages have an ‘acceleration clause’, which usually says that if you miss a payment the entire amount owing on the mortgage is payable right away.
Can the lender take my house if I miss payments?
The lender can start the foreclosure process if you default on your mortgage. Default means you break any of the terms of your mortgage, including falling behind on mortgage payments.
When you arrange a mortgage, it is a contract between you and the lender, where you agree to pay back the principal and interest according to a set schedule. You are the legal owner of the house, but the lender will record the mortgage with the Land Registry, to protect their interests. The house is security for the loan. If you do not make payments as scheduled, the lender has the legal right to force a sale of the house.
Lenders usually do not want foreclose, and will make reasonable efforts to get you back on track so you can keep your home, including refinancing or setting up a payment plan. Talk to your lender right away if you are having trouble making your mortgage payments. Do not wait until legal proceedings have started against you.
Demand letter: Before taking legal action the lender or their lawyer will usually send you a demand letter. By the time a Demand Letter is sent the lender has usually already hired a lawyer, which will increase the amount of money the lender is looking for to bring the mortgage up to date.
A demand letter:
- tells you why you are in default (for example, you have missed payments)
- tells you the amount you owe. This usually includes arrears and legal costs
- gives you a deadline (often 10 days) for making the payment
- says it is your last chance to pay before the lender takes legal action.
If you get a demand letter:
- Call the lender or their lawyer right away. Try to negotiate with the lender or their lawyer to get your mortgage back on track if possible
- Ask whether you can refinance, to lower your mortgage payments and pay them over a longer period
- Try speaking with a new lender to see if you can get a new mortgage to pay off the original mortgage
- Get help from a credit counsellor or licensed insolvency trustee
- Consider putting your property up for sale.
Notice of Action and Statement of Claim
This is formal notice that the lender is foreclosing, and that they have started the court process.
Notice of Action and Statement of Claim: If you do not respond to a demand letter before the deadline in the letter, or cannot negotiate an agreement with the lender, the lender, may start the foreclosure process.
The lender starts foreclosure by having a legal document called a Notice of Action and a Statement of Claim filed with the Supreme Court of Nova Scotia and delivered to you. They are required to deliver this notice to you in person (‘personal service’). It is not something they may drop off in your mail box or courier to you, unless the lender has applied to the court to get permission to have you served (notified) in an alternative way, called substituted service. However, a court generally only grants substituted service if the lender proves to the court that they have tried all reasonable ways to serve the borrower in person.
It is not a good idea to evade personal service as this will increase the lender’s legal costs, and so will increase the amount the lender is looking for when foreclosure is complete.
A Notice of Action is a court document that tells you that the lender is starting a legal process against you because you broke the terms of your loan or mortgage. It tells you the basics of who is involved in the foreclosure process, and how long you have to file a defence.
A Statement of Claim is a court document attached to the Notice of Action. The Statement of Claim outlines the details of what the lender is claiming against you in court. It may include the following:
1) The date of the mortgage
2) Details of the registration of the mortgage at the Registry of Deeds or Land Registration office
3) The property involved
4) Details of the default (for example, you defaulted because you did not make a payment or broke some other term of the mortgage)
5) Details of any agreement(s) that might have changed your mortgage
6) The total amount outstanding on the mortgage or amount unpaid. This will usually include the principal balance, interest, property taxes, legal fees and out-of-pocket expenses of the lender, generally known as “protective disbursements”
7) A statement asking for foreclosure and sale of the property (‘Order for Foreclosure, Sale and Possession’) if the total amount of the mortgage, interest and costs are not paid
8) A statement asking for a deficiency judgment to cover the balance of the loan if the property is sold for less than what is owed to the mortgage lender.
Options if you get a Notice of Action and Statement of Claim
Once you are served the Notice of Action and Statement of Claim you may:
- pay the money (which usually means paying the entire principal, interest and costs - including legal costs); or
- file a defence to the claim within the required time; or
- apply to court, within the required time, to ask to have the foreclosure process discontinued. You would need to pay up all the arrears and legal costs. The right to have the foreclosure discontinued is only available once during the life of your mortgage.
Filing a defence
The form and general instructions for filing a defence are on the Nova Scotia Courts website under How to Defend an Action on the Supreme Court-Court Forms page. Try to get legal advice if you want to file a defence. Contact a lawyer in private practice, or there is a Free Legal Clinic in Sydney and Halifax, for people who are going to Supreme Court without a lawyer.
If you want to file a defence, you must file it within the required time.
If you disagree with what is in the Notice of Action & Statement of Claim, you should file a defence with the Supreme Court of Nova Scotia within the following time:
- 15 business days if you are served in Nova Scotia
- 30 business days if you are served outside of Nova Scotia but within Canada; and
- 45 business days if you are served outside of Canada.
The days are business days, so weekends and weekdays when the court is closed are not included. The 15 day timeline applies to most circumstances, so do not miss the deadline.
If you choose to file a defence, it should include why you feel your property should not be foreclosed on.
Some examples of defences may include:
1) That the mortgage was not signed
2) You never received money from the lender
3) You repaid the lender
4) You have not broken any mortgage terms and you are not in default.
You must file your defence with the Supreme Court of Nova Scotia and serve the lender or their lawyer personally with a copy of your defence. The court will then give you a court date for you to dispute the lender’s claim to a foreclosure.
If you do not file a defence
If you do not either file a defence or apply to court for other relief, such as applying to court to have the foreclosure discontinued, the lender will apply to a judge for an Order for Foreclosure, Sale and Possession of the property. This court application is called a motion, and is usually ‘ex parte’, which means without notice to you. The idea is that you were already notified of the court process when you got the Notice of Action and Statement of Claim and chose not to participate by not filing a defence.
At the hearing for the Order for Foreclosure, the judge can:
- Ask for more information or better proof of the mortgage debt
- Order that others be there before the judge hears the case
- Direct the sale of the property, making an order of foreclosure and sale
- Make an order stating what should happen concerning the payment of the money owed.
Can foreclosure be stopped?Maybe. Some possibilities are: negotiating; redeeming the mortgage; reinstating the mortgage; filing a successful defence.
Negotiate: The easiest way is to negotiate with the lender. If you have missed payments, contact the lender and talk about your situation. The lender may be willing to give you time to catch up with payments. You may be able to refinance, so that you have lower mortgage payments over a longer term. Never ignore the lender’s letters or inquiries.
Redeem: You may “redeem” the mortgage by paying the full amount owing on the mortgage, including the interest, principal and any penalties or costs, before the sale of your property at public auction. This way you keep the equity built up in your home.
This may mean:
- getting a new mortgage from a different lender in order to pay out the first mortgage. This can be difficult. Sometimes a mortgage broker can help. The Financial Consumer Agency of Canada has general information about mortgages that you might find useful; or
- selling your property before the auction for more than what is owed to the lender.
Apply to Supreme Court to discontinue the foreclosure (‘reinstate’ your mortgage): This option can only be used once during the life of a mortgage. You can apply to court to have a foreclosure action discontinued (have the mortgage ‘reinstated’). This is a right under a provincial law called the Judicature Act. If the default is non-payment of the mortgage, you will have to pay all the arrears and the lender’s legal costs (legal fees and out-of-pocket expenses). If the default is a breach of a covenant (promise), you will have to perform the promise, and pay the lender’s legal costs. You can apply to court to discontinue the foreclosure even if the lender is refusing to accept payments. However, you can only apply to court to discontinue the foreclosure before the lender has made the motion and obtained a court order for foreclosure and sale (see ‘If I do not file a defence’).
Defend the action: if you file a successful defence, the foreclosure process may be stopped.
Will bankruptcy stop foreclosure?
No, the lender can still foreclose if you are in default of the mortgage terms. However, it may help you to declare bankruptcy on other debts so that you may concentrate your finances on paying the mortgage, and may deal with a deficiency claim if the property is sold at public auction and there is a shortfall. You should talk to a licensed insolvency trustee about your financial situation and the options open to you. Go to the bankruptcy page for more information, or contact the federal Superintendent of Bankuptcy.
Can I still sell my house?
Yes, you may try to sell the house or property up until a foreclosure order has been issued by the court.
Can the lender refuse payments once a court process starts?
Nova Scotia’s Judicature Act gives you the right to discontinue the foreclosure process by paying all outstanding arrears and costs owed to the lender or performing the covenant (promise) that is being broken. This is also called reinstating the mortgage. You can do this even if the lender is refusing to accept payments. This can be done up until an Order for Foreclosure, Sale and Possession has been issued (made) by the court. This right is only available once per mortgage. You must apply to the Supreme Court of Nova Scotia. You should get legal advice from a lawyer if you can, to get help with your application. Contact a lawyer in private practice, or there is a Free Legal Clinic in Sydney and Halifax, for people who are going to Supreme Court without a lawyer.
The court has no power to discontinue on payment of arrears and legal costs if there is a second foreclosure proceeding under the same mortgage (i.e. where you reinstated the mortgage and default again, and the lender starts foreclosure proceedings for the new default). If the mortgage has been reinstated once before, the only way to stop the new process is through agreement with the lender or by paying the entire amount of the mortgage, plus interests, costs and out-of-pocket expenses.
Who are the plaintiffs and defendants in a foreclosure
Plaintiff: this is the lender who started the foreclosure process. Their lawyer will be at the court hearing on the lender’s behalf.
Defendants may include:
- You, and any other borrowers on the mortgage
- Guarantor, if someone acted as a guarantor for the mortgage
- Trustee in Bankruptcy, if the borrower is bankrupt, or was bankrupt during the mortgage
- Owner of the property (any new owner).
If no defence is filed, usually only the plaintiff’s lawyer will be at the foreclosure court hearing.
Sale of the Property
If the lender is successful on their motion and got an Order for Foreclosure, Sale and Possession, the lender will arrange for sale of the home, usually through public auction by the Sheriff.
After the court grants an Order for Foresclosure, Sale and Possession, there will be a Sheriff’s sale by public auction. The auction is done by the Sheriff, or by any other person given that power by the court. Recently, the court in Nova Scotia has allowed the sale to be done by an experienced foreclosure lawyer in order to reduce fees associated with the Sheriff.
The property will be sold at a public auction in the county where the property is located.
The plaintiff (lender or their lawyer) must:
- advertise the sale of the property in a local newspaper in the area where the property is located. There must be at least two advertisements in a local newspaper, the first at least 15 days before the sale, and the second within 7 days of the sale;
- at least 15 days before the sale, notify the property owner(s) and the borrower(s), if they are not the same person, of the date, time and place of the sale. Notice to the borrower can be sent by regular mail.
The notice will contain the time and place of the auction.
Although unusual, if the lender has an offer to purchase the property from a third party and all subsequent encumbrancers agree with the sale, the lender may apply to the court for approval to sell the property privately. However, in most cases the property will be sold at a public auction.
Can the lender buy the property on foreclosure
Yes, the property is sold to the highest bidder at a public auction.
Public Auction process
The Sheriff, or person appointed by the court, will hold the public auction at the time and place in the notice. If you wish to bid, you must go personally or send someone to bid on your behalf.
The successful bidder will have to pay 10% of the sale price at the end of the auction and then has 15 days to pay the rest If you are the successful bidder, and you have not paid the rest within the 15 days, you will lose the 10% deposit, as it will be applied against the amount owing to the lender. You cannot recover this money.
The rules requiring 10% down payment at the auction are firm. If you are the highest bidder and do not have the full 10% in guaranteed form (cash, certified cheque or solicitor’s trust cheque) with you at the auction, your bid may be unsuccessful and the property will go to the next highest bidder. The Sheriff has the discretion to allow the highest bidder a short amount of time to get the funds but is not required to do so and may refuse. Even if the Sheriff provides you with a short time to get the funds, in practice it is as little as 20 minutes. Therefore, if you want to be the successful bidder, you should ensure you have the 10% available at the auction.
If the lender is the successful bidder they may still ask for a Deficiency Judgment.
Deficiency Judgment explained
Deficiency: Following the sale, a lender may apply to the court for a Deficiency Judgment, which is a request by the plaintiff to get a judgment against the borrower for the shortfall amount; that is, the difference between the amount owing on the mortgage (plus interest, costs, out-of-pocket expenses, Sheriff fees, property taxes), and the amount received from the sale of the property.
The lender must show that the amount obtained from the sale of the property is a fair market price. This is determined either by actual sale or though an appraisal.
The borrower and anyone else who may have to pay the deficiency amount will get at least 10 days’ notice of the deficiency hearing. The plaintiff has 6 months to apply for a Deficiency Judgment, from the date of the Sheriff’s sale.
What if the sale price is more than the amount owing
Surplus: If the sale of the property brings in more money than the amount of Sheriff’s fees and outstanding taxes and the amount owed to the plaintiff, the surplus is given to the Accountant General of the Supreme Court. It will be distributed among those who have filed claims against the property and those who are owed money by the borrower (known as subsequent encumbrancers). They can apply to the court to be paid and are paid according to priority. Before these people are paid the Sheriff must pay any outstanding property taxes from this surplus. If there is still a surplus, any party involved with the foreclosure, including the borrower, may apply to the court or judge to receive the surplus. Before applying however, each party must file an affidavit (sworn document) to prove they are entitled to a claim. The court or judge may then order the distribution of the surplus to the parties by priority.
You should try to get legal advice if you wish to make a claim for surplus.
Can the sale be overturned
The court has the power to overturn the sale in exceptional cases. An example would be if the directions in the foreclosure order were not followed.
What happens once the property is sold
Once the property is sold and the amount due has been paid to the lender , the Sheriff files a report with the court as soon as possible. This report states that the property has been sold, the name of the successful bidder, the purchase price, how the money was distributed and that the Sheriff has delivered the deed to the property to the successful bidder.
What happens once the Sheriff's report is received by the court
Once the report is filed, the lender will apply for an Order Confirming Sale. This order states that the sale has taken place and that the foreclosure is complete. The lender must also file: 1) The sheriff’s report and 2) An affidavit (usually prepared by the plaintiff’s lawyer) stating that the advertisement was done and notices were sent to all those who had interest in the property.
How soon do I have to leave the property
You should be ready to move out on the date of the public auction.
If you are a homeowner, you must leave the property once the successful bidder completes the purchase, unless the new owner says otherwise.
The Order for Foreclosure, Sale and Possession usually gives the lender the ability to ask the Sheriff to deliver possession of the property. This means the lender may require that you leave as soon as the Order for Foreclosure, Sale and Possession has been issued (made).
However, lenders generally don’t request vacant possession (require that you leave) until the date of the sale at public auction. When a lender sends the notice of sale under public auction to the homeowner, they usually advise that the homeowner must vacate (leave) the premises on or before the date of the sale at public auction.
Once the property has been sold on the date of the public auction, you may ask the new owner for permission to stay in the property. However, they have no obligation to let you stay and therefore you should be prepared to move out on the date of the public auction.
If you are a tenant, how soon you move out depends on the type of tenant you are. If you are a residential tenant (for example, renting an apartment) you must be given notice according to the the Residential Tenancies Act (the earlier of 3 months or the expiry of the lease under any written lease agreement – such as a fixed term lease). Contact Residential Tenancies at 902-424-5200 or 1-800-670-4357, or online at gov.ns.ca/snsmr/access/land/residential-tenancies.asp for more information. If you are a commercial tenant (a place rented for business) you must move out the day of the foreclosure sale, unless the new owner tells you otherwise.
The successful bidder becomes owner of the property once the full purchase price has been paid and the Sheriff gives him or her the deed. The foreclosure is complete once the Confirmatory Order is granted.
How long foreclosure takes
If no defence is filed and the lender goes through the normal steps, foreclosure takes 2 to 3 months from the filing of the Notice of Action and Statement of Claim to the concluded sale. It may take longer, depending on the court schedule.
The 2 to 3 months consists of:
1. The 15 days to file a defence after being served the Notice of Action (longer than 15 days if you are served outside of Nova Scotia, as set out above).
2. If no defence is filed, the lender can schedule the Motion to court for Order for Foreclosure, Sale and Possession, with 2 days’ notice.
3. The 15 days’ notice required between the Order for Foreclosure, Sale and Possession and advertisement for the sale at public auction.
4. The 15 day time limit for the successful bidder at the auction to pay the full purchase price.
The days are business days, so weekends and weekdays when the court is closed are not included. The rest of the time involved will depend on how quickly the lender decides to proceed, and the availability of a judge to hear the case and grant the orders.
If a defence is filed, the above timeline can vary a lot. The lender may make a motion to court for summary judgment, and how long things will take will depend on the success of the defence, as well as the court schedule.
More help and information
For help and information:
- Your lender: read your mortgage document carefully, and talk with your lender about options you may have if you are having financial problems
- A lawyer: It is best to try to talk with a lawyer if you are unsure about what to do.
Nova Scotia Legal Aid does not generally deal with foreclosures, although you should contact them directly to see if they can help in your situation - go to nslegalaid.ca, or look under 'Legal Aid' or 'Nova Scotia Legal Aid' in the telephone book.
Otherwise, you would need to speak with a lawyer in private practice. The Legal Information Society offers a Legal Information Line and Lawyer Referral Service if you need help finding a lawyer. Through this service you can get free legal information, and you may be referred to a lawyer who will meet with you for up to 30 min for a fee of $20 + tax, after which regular fees would generally be charged. The number is 902-455-3135 in the Halifax Regional Municipality, or toll free at 1-800-665-9779.
There is also a Free Legal Clinic in Sydney and Halifax, for people who are going to Supreme Court without a lawyer.
- More information about the foreclosure process:
- A trustee in bankruptcy, also called a Licensed Insolvency Trustee can provide professional advice about your options for dealing with debt. Trustees are listed in the Yellow Pages under 'Bankruptcies', or search for 'trustee in bankruptcy' online. You can also get a listing of local trustees from the Office of the Superintendent of Bankruptcy at 1 877 376-9902 (toll free) or osb.ic.gc.ca
- Office of the Superintendent of Bankruptcy - regulates bankruptcies, oversees and licenses trustees in bankruptcy (licensed insolvency trustees), and has helpful general information for debtors and creditors
Phone: 1 877 376-9902 (toll free)
- A credit counselling agency. Credit counsellors cannot administer bankruptcies or consumer proposals, but can help you in a number of ways, such as a debt management plan, budgeting, wise credit use, and general money management. The Financial Consumer Agency of Canada - has information about how to find a reputable Credit Counselling service: www.fcac-acfc.gc.ca.
- Debtor Assistance Program, offered through Service Nova Scotia. Provides free help with managing your money, dealing with creditors, and consumer proposals, but cannot adminster bankruptcies (you need a licensed trustee for a bankruptcy). Contact the Debtor Assistance Program at 1 800 670-4357 or 902-424-5200, or online at gov.ns.ca/snsmr/access/individuals/debtor-assistance.asp
- Financial Consumer Agency of Canada, or call 1 866 461-3222. Lots of consumer information on many money related topics.
Reviewed December 2017
What is title to land? Does it matter if you don't have clear title to land? What are 'squatters rights'? Read on for answers to these and other questions about land titles.
The following is general information about land titles. It does not replace a lawyer’s advice about a specific legal problem. Everyone’s situation is different, so you may need to get legal help about your matter. Click here to download this information in pdf.
Title to Land
Is all the land in the province owned by someone or is some of the land public land?
The Province owns about 35% of the land in Nova Scotia, and the rest of the land (about 65%) is owned privately, or by the federal and municipal governments. The majority of the publicly owned land is managed by the Department of Natural Resources. This land is often referred to as Crown lands.
Can people buy Crown lands or other provincial lands?
The Province has been working to buy more land, and does not sell a great deal of the land it owns because the percentage of public land ownership in Nova Scotia is small compared to the rest of Canada. From time to time, the government does sell land if the purpose is for economic development or to assist a municipality or community – people can apply to buy land through the Department of Natural Resources.
What if it seems like no one owns a piece of land – can someone buy or use the land?
Most of the land in the province is listed in the name of an owner. Some lands are listed in the land records as “owner unknown”. This happens when the municipality cannot identify who the owner is. “Owner unknown” lands can be sold for unpaid taxes.
What is title to land?
“Title to land” means ownership of the land. A person who has “title to land” has satisfied the legal requirements to own the land and can exercise the rights of land ownership, including the right to:
- use and occupy land; and
- to include or exclude others from using the land.
“Title to land” can also refer to a legal document such as a deed, which proves ownership.
What rights and obligations go with having title to land?
A person who has title to land can exercise all the rights landowners enjoy. These rights include any lawful use such as:
- building on the land
- developing the land
- selling the land
- leasing or mortgaging the land, and
- giving the land to someone by transferring ownership.
These rights are subject to restrictions imposed by laws such as municipal land-use bylaws.
Courts will enforce those rights and make sure that others, including governments, respect them.
Where a person does not have title to a specific piece of land, they may be denied the opportunity to exercise these rights.
Having title to land means that the landowner must comply with the legal obligations of land ownership. These obligations will vary depending on where that land is located. In Nova Scotia, the main legal responsibilities of landowners include paying municipal property taxes and following land use bylaws. If you don’t pay taxes and follow applicable laws, the consequences can be severe – you may need to pay a fine or you could lose title to your land.
What does it mean to have clear title to land?
Clear title to land means there is legal certainty about who owns the land. In many cases, it is easy to identify the legal owner of a piece of land; however, sometimes several different people claim to own the same piece of a property. For example, two siblings may both claim to own the same parcel of land. If you have clear title, there are no claims on the land from others.
Why is having clear title to land important?
Clear title to land is important because it provides landowners with legal certainty that they can enjoy the rights and obligations of land ownership. Clear title to land enables landowners to develop, sell, lease, mortgage and transfer their land within the bounds of the laws where that land is located.
If I do not have clear title, what are the consequences?
Without clear title to land, the landowner’s rights may be limited or restricted by other people’s claims to the same land. This could stop the landowner from developing or selling their land. Also, it could result in family conflicts about the current and future uses of the land. For example:
- A person who wants to build a home may be stopped from doing so by another person who claims to have an interest in the same piece of land. As a result, until the dispute is resolved, the land cannot be used or developed fully.
- A person who wants to sell their land may not be able to do so if they do not have clear title.
- If it is not clear who owns the land, occupiers of the land may not know they should pay the property taxes, or may decide not to, and the land could be sold by the municipality for unpaid separate homes built on a single piece of land that has not been legally subdivided. It may not be clear who must pay the taxes.
How do I get clear title to land?
A person can get clear title to a parcel of land in several different ways – the three mentioned below are the most common ways.
- Marketable Titles Act – A person can ask a lawyer to search for evidence that will establish proof of title, such as a valid property deed, agreement of purchase or sale, or a will. One of these documents, when combined with proof that the property has been occupied for at least 20 years (if private land, or 40 years if Crown land) will generally provide enough proof for the lawyer to provide a certificate of title.
- Quieting Titles Act – A person who cannot find paper evidence of 20 years of ownership of the land (for example, a deed may be missing) can ask the court to establish their title to the land. The property owner must give evidence to the court to prove their use and occupation of the land, and if the information is good enough, the court can grant a certificate of title. When more than one person is claiming the same parcel of land, the court can consider each claim and decide who has the best claim of ownership, or if the land should be divided between the claimants.
- Land Titles Clarification Act – In 13 areas of Nova Scotia, including Cherry Brook, North Preston and East Preston, a person can apply to the provincial Department of Natural Resources for a certificate of title to their land. Help of a lawyer will be needed to complete this process. The claimant must provide a description of the property, evidence and the names of other persons who may have an interest in the property. For more information on this process, go to the Department of Natural Resources website: novascotia.ca/natr/titles-clarification/
What if someone claims to have a right to cross your land?
A claim of a right of way or an easement (easements allow one neighbour to cross over the property of a neighbouring landowner) over a parcel of land will not challenge the owner’s title to the land, but those interests can impact the legal owner’s ability to fully enjoy the rights that go with having title to land. For example, a person who has a right of way may have the right to use your driveway to access their property.
What are squatters’ rights and how do they impact title to land?
Squatters’ rights are rights of land ownership that are gained through use and occupation of land that is legally owned by someone else. These rights eliminate the ownership of the person who has legal title to the land. Another name for squatters’ rights is adverse possession.
To claim adverse possession of someone’s land, a person must show that:
- they (or other people before them) have continuously occupied and used the land for at least 20 years,
- their use of the land has been publicly known, and
- their use of the land has excluded other people from using the land.
Squatters’ rights can also be claimed against the Crown (government) but the squatter must show 40 years of continuous use and occupation.
How do I claim adverse possession of land (or squatters’ rights)?
If a person has enough evidence to establish that they have used and occupied privately owned land for more than 20 years, they can ask a lawyer to register their ownership interest in the land under the Land Registration Act.
If the person is making a claim against the Crown and has good evidence of 40 years of use and occupation of Crown lands, they can apply to the Department of Natural Resources for a certificate of release. If the department is satisfied that the evidence proves that the Crown’s ownership right has been wiped out, the certificate of release is issued to let everyone know that the Crown no longer owns the land. The person then must get a lawyer to register their ownership interest in the land. Ownership claims can also be proven in court using the Quieting Titles Act.
What is land registration?
Land registration is a process that gives landowners a way to be certain that they have clear title to their land. Once land is registered in the system, the landowner has priority over all other persons who may claim an ownership interest in the same land.
Why is land registration important?
Land registration is important because it provides certainty. It ensures that the registered landowner has all the rights of ownership including developing, selling or transferring land. It makes it easier for landowners to avoid conflicts regarding the title to their land so that the land can be used as the owner wishes.
How do I register my land?
If you want to register your land, you will need the help of a lawyer who is certified to register land titles. Certain transactions, including the sale or mortgage of previously unregistered land, automatically require the land to be registered, but a landowner also may voluntarily register their land.
Once I register my land, can someone else use it or take it away?
In certain situations – especially those involving fraud or prescriptive easements – land title registration may not provide absolute protection for registered titleholders against competing claims, but land title registration provides the maximum legal protection possible against competing claims.
Once I register my land, can the government take it away?
Provincial and municipal governments and public utilities such as Nova Scotia Power and the Halifax Water Commission can take (expropriate) private land, but only if it is for a public purpose. Usually, this would be to build roads, or to expand or improve public services. If your land is needed for a public purpose, the government must compensate you by paying you the market value of the land.
For more information
Department of Natural Resources: Land Titles Clarification
Visit novascotia.ca/natr/titles-clarification/ , or contact the Department of Natural Resources, Land Services Branch for information about:
- applying to get clear title to land under the Land Titles Clarification Act
- adverse possession (squatter's rights)
- Crown Land
Nova Scotia Land Registry
Visit www.novascotia.ca/sns/access/land/land-registry.asp for information about Land Registration
The information on this page was made possible by the Nova Scotia Barristers' Society, with support and input from various individuals and organizations.
Landlord & tenant rules (residential)
Do you rent? Are you a landlord? Here you will find basic information, and links to other more comprehensive resources, about the Residential Tenancies Act (‘RTA’), which is the law that sets out the rights and responsibilities of residential landlords and tenants in Nova Scotia, and provides a way to resolve disputes.
The Residential Tenancies Act does not apply to commercial leases, on-campus university or college residences, hospitals, municipal homes, prisons, some nursing homes, and hotels.
Landlords can only evict with proper notice and a good reason
All tenants get security of tenure immediately
Security of tenure means that a landlord cannot end a tenant’s lease without a good reason.
All tenants get security of tenure right away. This means:
- tenants have the right to stay until they give the landlord proper notice that they are moving out, except for a fixed-term lease, which ends on the date specified in the lease; and
- a landlord can still give a tenant notice that they must move out, but must have a valid reason for doing so.
Examples of reasons for a landlord to give notice under the Residential Tenancies Act are that the landlord claims the tenant:
- is at least 15 days behind on rent in a yearly, monthly or fixed-term lease, or 30 days behind for a land-lease community
- was disruptive to other tenants, interfering with their ability to live in their unit ("bad behaviour")
- damaged the premises
- sublet or assigned the premises without the landlord’s consent
- broke the lease terms or responsibilities under the RTA
- is a safety risk to the landlord or other tenants.
If rent money is late
Notice to quit process for unpaid rent
A landlord can give a 15 day notice to quit if the tenant is 15 days late in paying the rent. This applies to a yearly, monthly, or fixed-term tenancy.
A tenant who gets a notice to quit for unpaid rent has 15 days to:
- pay the landlord all the rent that is past due. This will cancel the notice to quit; or
- apply to the Director of Residential Tenancies (‘Residential Tenancies’) to dispute the notice to quit; or
- leave, but unpaid rent will still be owed to the landlord.
If the tenant does nothing, and is still in the property 15 days after getting the notice to quit, the landlord can apply to Residential Tenancies for an order requiring the tenant to leave (‘order for vacant possession’). If the landlord does this the law says Residential Tenancies is not required to investigate, try to mediate, or hold a hearing. Residential Tenancies can simply make the order for vacant possession and mail it to the landlord and the tenant. The tenant has 10 days from the date of the order to appeal to Small Claims Court. If the tenant does not appeal then the Sheriff can evict the tenant.
No hearing is required, so it is up to the tenant to apply for a hearing within the 15 days if they want to contest the notice and have their say.
Tenants who need to get out of their lease early
Tenants who need to get out of their lease early
To end a yearly lease a tenant must normally give 3 months' written notice before the anniversary date.
However, a tenant in a yearly lease may give the landlord just one month’s notice to quit if the tenant has:
- lost income because of deteriorating health
- cannot continue the lease or access the premises because of deteriorating health; or
- been admitted to a nursing home or other special care facility.
The tenant must provide a doctor’s certificate, or proof of acceptance into a nursing home.
These short notice rules also apply to tenants in a fixed-term lease.
The tenant must give a copy of the notice to quit to any other tenants living with them, at least 1 month before the tenancy ends. The tenancy then ends for all tenants, but the remaining tenants may negotiate a new lease with the landlord. The landlord must agree to do this, unless there is a good reason not to.
There is a further exception to the normal notice periods for ending a lease: a victim of domestic violence may end a yearly or fixed term lease by giving the landlord just 1 month’s written notice, along with a certificate from the Department of Justice, Victim Services.
A victim must first apply to Victim Services for a certificate. Victim Services may give a certificate if either:
- There is an emergency protection order (‘EPO’), and the tenant applied to Victim Services within 90 days of getting the EPO (What is an EPO? Click here);
- Victim Services is satisfied that:
- A domestic violence complaint has been filed with the police, naming the tenant as victim; and
- there is a current peace bond or other ‘no contact’ court order requiring the alleged abuser to stay away from the tenant; and
- an assessment gives Victim Services reason to believe the tenant is a victim of domestic violence.
Although there is no appeal if Victim Services refuses to grant a certificate, a tenant can apply again if something new happens. Victim Services is not required to hear from the alleged abuser when deciding whether to issue a certificate.
For more information about ending a lease early because of domestic violence:
- NS Department of Justice, Victim Services – 1-888-470-0773 or online at: novascotia.ca/just/victim_Services/
- NS Residential Tenancies: 1 800 670-4357 or 902-424-5200, online at: gov.ns.ca/snsmr/access/land/residential-tenancies.asp
- NS Domestic Violence Resource Centre: nsdomesticviolence.ca
- NS government news release: novascotia.ca/news/release/?id=20130911001
Some other rules
Some other rules
- landlords and tenants must use the Residential Tenancies forms, which are available online at accessns.ca/residential-tenancies/forms
- Landlords must provide tenants with a copy of the Residential Tenancies Act (at least one tenant where there are co-tenants) within 10 days of the earliest of:
- the tenancy start date, as given in the lease
- signing the lease
- getting keys to the residence
- the date the tenant(s) is allowed to move in.
- Landlords can provide a copy of the Residential Tenancies Act in one of 3 ways: paper copy, electronic copy, link to a copy on the NS legislature website (nslegislature.ca/legc/statutes/residential tenancies.pdf). Tenants who want a paper copy of the Residential Tenancies Act can get one from Residential Tenancies at 1 800-670-4357 or 902-424-5200, or using their online request form
- tenants in land-lease communities cannot have their rent increased by more than a maximum annual amount (1.1% for 2017), calculated based on regulations under the RTA. A landlord who wants to increase rent by more than the maximum amount must apply to Residential Tenancies for permission.
- Landords can only increase rent once every 12 months, on the anniversary date of the tenancy, and must give proper written notice of the increase (4 months' notice in a yearly or monthly lease; 8 weeks' notice in a weekly lease). Rent may be increased by any amount (except land-lease communities and public housing): more about rent increases
- Landlords may charge up to a $75 fee for a sublet or assignment, but only for actual costs incurred
- the Residential Tenancies application fee and Small Claims Court appeal fee can be awarded to the person who wins.
For more information
For more information
For more information about these and other Residential Tenancies Act rules, or for help with a landlord/tenant issue:
- visit Residential Tenancies online at accessns.ca/residential-tenancies
- call Residential Tenancies at (902) 424-5200 or 1 800 670-4357
- visit your nearest Residential Tenancies office (go to gov.ns.ca/snsmr/offices for locations)
- read Residential Tenancies Guides: novascotia.ca/sns/access/land/residential-tenancies/guides.asp
The Residential Tenancies Act and regulations are available online: nslegislature.ca/legc/statutes/residential tenancies.pdf and gov.ns.ca/just/regulations/regs/rtgenrl.htm
For more legal information or legal advice:
- Contact a lawyer in private practice , or
- If you are a tenant who has a low income Nova Scotia Legal Aid or Dalhousie Legal Aid Service may be able to help. Contact them for details.
- Nova Scotia Legal Aid has online legal information for tenants, available at: nslegalaid.ca/legal-information/residential-tenancy/
- Dalhousie Legal Aid Service has a Tenant Rights Guide, available online at: dal.ca/faculty/law/dlas.html
- Office of the Privacy Commissioner of Canada: Privacy in the landlord-tenant relationship
- Canada Mortgage and Housing Corporation: Your Guide to Renting
Reviewed December 2016
Tenant Rights Guides - Dalhousie Legal Aid
Know your rights as a renter in Nova Scotia.
Download Dalhousie Legal Aid's Tenant Rights Guides below:
Dalhousie Legal Aid's Tenant Rights Guides are posted on the Legal Information Society of Nova Scotia's website with permission from Dalhousie Legal Aid Service.
The tenancy guides are meant to inform the public of their rights and obligations as a tenant. They were created in an attempt to address the clear knowledge imbalance found in tenancy relationships and provide support to all residents of Nova Scotia.
Dalhousie Legal Aid Service is a legal aid clinic based in the North end of Halifax and connected to the Schulich School of Law at Dalhousie University. It is comprised of community groups, law students, community legal workers and lawyers all working together. The mandate of Dalhousie Legal Aid is threefold: to provide services to low-income community members in need of legal assistance, to engage in community development and law reform work and to provide a meaningful educational experience for third year law students. It also does community outreach, public education, and lobbying to protect low-income individuals in Nova Scotia.
The clinic was the first legal service in Nova Scotia for low-income communities, getting its start in 1970 as a summer project of five Dalhousie law students. It is the oldest clinical law program in Canada and the only community law clinic in Nova Scotia.
You can contact Dalhousie Legal Aid Service by phone at 902-423-8105.
The following is general information about property taxes. It does not replace a lawyer’s advice about a specific legal problem. Everyone’s situation is different, so you may need to get legal help about your situation. Click here to download this information in pdf.
Note: Some of this information is only about property taxes in the Halifax Regional Municipality. Please contact your local municipality for tax information specific to your community.
Information about the Property Valuation Services Corporation and property tax appeals applies across Nova Scotia.
What is property tax?
The city collects property taxes from property owners. Property taxes are one of the most important ways money is raised to pay for things like schools, fire and police departments, streetlights and community centres.
How is property tax collected?
Your municipality will send out a tax bill. For example, in the Halifax Regional Municipality the city sends a tax bill every six months. Payments are due at the end of April and the end of October. The Cape Breton Regional Municipality sends an interim tax bill in April, and a final tax bill in September. Please check with your local municipality for details in your community.
You can generally pay your property taxes in several ways, including: online banking, online credit card payment, in person with a cheque or money order, or as part of your mortgage payment.
How is property tax calculated?
Property taxes are calculated as a percentage of the value of the property. The value of a property or “assessed value” is determined by a not-for-profit organization called the Property Valuation Services Corporation (PVSC).
Assessments are determined by market value, which varies by community and type of home. Tax rates are set by the city, looking at services provided (e.g.,fire, police, schools, sidewalks, transit), along with mandatory contributions for services such as education and corrections.
Are property tax calculations based on the value of the house or the property (land)?
Property taxes are based on the market value, or the price a willing seller would receive from a willing buyer for the property. Any houses or buildings that are on a property affect its value. For example, a property with a house will usually have greater value than a property with no house.
I disagree with the assessed value of my property. What can I do?
You have the right to appeal your property assessment if you disagree with it. You must appeal within 31 days of receiving your Assessment Notice in the mail or epost.
Assessments are mailed out in January each year. You can appeal your assessment by mailing or faxing an appeal form that explains why you are appealing the assessment to the PVSC. The appeal form is attached to your Assessment Notice, and must be received by the PVSC by the date (deadline) indicated on your Assessment Notice.
Contact PVSC toll free at 1-800-380-7775 or visit their website at www.pvsc.ca/en/home/howassessmentworks/appealinformation/default.aspx for more information about the appeal process.
What happens if I don’t pay my property tax?
If your property taxes are not paid on time, the account will fall behind. This is called being “in arrears”.
If this happens, interest will be charged on the amount you owe. For example, in the Halifax Regional Municipality the interest rate charged for accounts that are in arrears is 15% per year (for example if you owe $1,000, after one year you would owe an additional $150 – a total of $1,150). The interest rate on arrears may differ in other communities across the province, so check with your local municipality.
If property taxes remain unpaid for more than one year, the city has the option of selling the property at a tax sale, or trying to sue on the debt as an alternative to a property tax sale.
What is a tax sale?
Property can be sold at auction if property taxes remain unpaid for more than one year. These tax auctions or sales are open to the public.
The city must try to notify the owner as well as all lien holders about the upcoming tax sale. Notice must be sent by registered letter.
The owner will receive information indicating:
- amount owed
- how much time left to pay
- date of tax sale, and
- estimated extra expenses that could be added.
When it is not possible to notify the owner, the property is posted with a Tax Sale Notice, which is stuck on the door of the property. Properties are sold for the amount of outstanding taxes, interest and expenses owed to the government, which is usually much less than the market value of the property.
Are there programs to help with paying property taxes?
Paying property taxes is an essential part of owning property. Municipalities across Nova Scotia offer some tax relief options, including tax payment deferrals or exemptions for those who have a lower income. Please check with your local municipality to find out what options are available in your community.
The Halifax Regional Municipality offers three tax relief programs that may help prevent property owners from falling behind on their tax bill, or help if you have already fallen behind on payments. The three programs are payment plans, rebates and deferrals. It is possible to combine these programs or use them individually.
PAYMENT PLAN Instead of making two large property tax payments in April and October, smaller payments can be made every month.
PROPERTY TAX REBATE Rebates are available if the combined net income of the adults living at a property is less than $32,000 per year. The rebate amount is calculated based on the combined income of the adults at the property and the amount of tax owed. This program can change from year to year and is tied in with the cost of living (consumer price index).
DEFERRAL OF PROPERTY TAX PAYMENTS Tax payments can be put off (“deferred”) if the combined income of the adults living at a property is less than $32,000 per year. Owners can choose to defer their entire payment, or just a portion of it. A small interest rate is charged to the deferred tax amount. The interest rate on deferrals in 2014-2015 is around 1%. This program can change from year to year and is tied in with the cost of living (consumer price index). The deadline to apply for these programs is March 31 each year, although this deadline is subject to change, so check with HRM. To apply you must provide proof of income based on your Notice of Assessment (received from the Canada Revenue Agency after income taxes are paid) and an application signed by the property owner. Depending on the individual circumstances, you may need to provide supporting documents to assist with the application. The HRM is pleased to assist those interested in these programs to complete their applications over the phone.
Some legal words you need to know
Arrears – money that is owed and should have been paid earlier. The amount accumulated from the date when the first missed payment was due.
Lien holders – someone who has a right or potential claim against someone’s property. The lien holder is usually a bank or another financial firm. For example a person or financial institution has given you money on loan to buy property or has made improvements to the property.
Market value – amount the property would probably sell for on the open market, with buyer and seller making an informed, voluntary deal. All real property is assigned a market value assessment by professional assessors employed by Property Valuation Services Corporation, on behalf of the Province. This value is based on such factors as construction quality, location and age of the property. This value may be adjusted annually to reflect changes that could go up or down in the market value of property in your area.
Notice of Assessment – a notice sent to property owners advising them of the current assessed property value for property (municipal) tax purposes.
Property assessment – the process of establishing a dollar value for property for property tax purposes. Property Valuation Services Corporation (PVSC) – responsible for property assessments in Nova Scotia.
Taxable Assessed Value – the assessment used to determine annual property taxes.
For more information
Property Valuation Services Corporation (PVSC)
Property Valuation Services Corporation (PVSC)
Nova Scotia Legal Aid: Prestons Outreach Facilitator
For information about Nova Scotia Legal Aid's outreach in the Preston communities, or to make an appointment, contact:
Preston Outreach on-site facilitator
Email: [email protected]
This information was made possible by the Nova Scotia Barristers' Society, with support and input from various individuals and organizations.
Safer Communities and Neighbourhoods Act
- What is SCAN?
- Who can make a complaint?
- How do I make a complaint?
- What happens if a complaint is made?
- What is a Community Safety Order?
- When will the Court decide to impose a Community Safety Order?
- I've been served with a Community Safety Order. Can it be changed or overturned?
- Can I appeal a Community Safety Order or other court order under SCAN?
- Can the Director apply to Court more than once to close down the same property?
- What are the penalties if I don't follow a Community Safety Order?
- What about my rights under the Residential Tenancies Act?
- Where can I get more information?
This page only gives legal information. If you have a legal problem you should contact a lawyer.
SCAN is a Nova Scotia law called the Safer Communities and Neighbourhoods Act.
SCAN deals with illegal activities that adversely affect a neighbourhood that:
- may be a health, safety or security concern, or
- interfere with peaceful enjoyment of property.
For example, SCAN covers specific activities like:
- illegal sale of alcohol or drugs
- illegal gambling, or
SCAN allows anyone to complain anonymously to Nova Scotias Public Safety Investigation Unit if they are concerned that these types of activities may be happening on a regular basis in their community.
Anyone can make a complaint if they believe activities like illegal sale of alcohol, possession of drugs, gambling, prostitution, are regularly happening in their community. Complaints are confidential.
Once you make a complaint you are referred to as the complainant. Your identity cannot be revealed unless you agree in writing. To make a complaint contact Nova Scotias Public Safety Investigation Unit at 1-877-357-2337. Youll find more information online at www.gov.ns.ca/just/Public_Safety/safer_communities.asp
Call the Public Safety Investigation Unit at 1-877-357-2337 to make a complaint.
After a complaint is made the Director of Public Safety or public safety investigators may:
- Try to solve the problem informally
- Ask for more information
- Question neighbourhood residents
- Investigate the complaint, including conducting surveillance of the property
- Send warning letters to the property owner or occupants
- Apply to court for a community safety order
- Take other steps the Director considers appropriate
The Director may decide not to act on a complaint, or to stop action on a complaint, and must tell the complainant about this decision in writing.
The Director does not have to give reasons for a decision.
A Community Safety Order is a court order that requires people to stop doing specific illegal things on a property, and may also order people to leave a property.
A Community Safety Order:
- gives the propertys address
- describes specific activities that are the reason for the order
- requires people not to do or allow any of the activities at the property
- requires certain people named in the order to do what is reasonable to stop the activities from continuing or happening again, and
- gives the date the order ends.
Depending on the situation, a community safety order might also:
- Order people to leave the property
- Stop people from going back to the property
- End a lease or tenancy agreement
- Order that the property be closed for up to 90 days, and
- Give the owner possession of the property.
A Community Safety Order might be put in place if the court is satisfied that
- there are activities happening that show the property is being used for a specified use, and
- the activities negatively affect the community or neighbourhood.
Specified use includes: illegal sale of liquor, prostitution, illegal gambling, illegal possession, use, sale, transfer or exchange of drugs. The activities must be happening on a regular basis.
If you have been served with a Community Safety Order and do not agree with it you should get legal advice right away. You may be able to get legal advice from Dalhousie Legal Aid or Nova Scotia Legal Aid. If you do not qualify for Legal Aid, you may contact a lawyer in private practice.
You may apply to the Court (Supreme Court of Nova Scotia) to ask a judge to change the Community Safety Order if you live in the property but are not the owner (for example - you are a tenant), and the order:
- says you and anyone living with you must leave (vacate) the property and can't go back
- ends your lease or tenancy agreement, or
- says that the property must be closed.
If you are not sure whether the order does any of these things, call the Public Safety Section, Policing & Victim Services Division, Nova Scotia Department of Justice, at (902) 424-2504.
You must apply to court within 14 days of the date you were served with the order.
A property owner or anyone who lives at the property, including a tenant, may apply to Court to change part of an order that says the property must be closed. You must apply to court before the date given for closing the property.
Applying to Court does not stay the Community Safety Order. This means that even if you apply to Court to try to get the order changed, you still have to follow the order until the Court says differently.
If you are a tenant the Court might change the community safety order by, for example:
- giving you and anyone living with you more time to leave the property
- allowing you to move back in if you already moved out, or
- putting your lease or tenancy agreement back in place.
You should get legal advice right away if you want to appeal a decision under SCAN. If you want to appeal you must apply to the Nova Scotia Court of Appeal within 14 days of the order you are appealing from. An appeal can only deal with questions of law, which are basically legal issues the judge made a decision about, not decisions on the facts. You must first get the courts leave (permission) to appeal.
The penalty is different depending on your offence. See the list below for offences under SCAN and the possible penalties:
- If you are found guilty of removing or defacing an order notice posted on a building under SCAN you may have to pay a fine of up to $2,500.00, be sent to jail for up to 3 months or both.
- If you are found guilty of entering a property that is closed under a Community Safety Order you may have to pay a fine of up to $5,000.00, be sent to jail for up to 6 months or both.
- If you are found found guilty of not following a Community Safety Order you may have to pay a fine of up to $500 for each day that you do not follow the order.
- Safer Communities and Neighbourhoods Act and regulations
- To make a complaint contact Nova Scotias Public Safety Investigation Unit at 1-877-357-2337. Youll find more information online at: http://www.gov.ns.ca/just/Public_Safety/safer_communities.asp
- LISNS Legal Information Line 1 800 665-9779 or 455-3135
For legal advice:
- Nova Scotia Legal Aid nslegalaid.ca, or listed under Legal Aid in the government blue pages of the telephone book
- Dalhousie Legal Aid Service (902) 423-8105
- A lawyer in private practice (a lawyer you would pay) - contact LISNS Lawyer Referral Service, or a lawyer listed in the Yellow Pages of the telephone book
Selling your Home
- What is my first step if I plan to sell my home?
- How do I list my house with a real estate agent?
- Can I have the same real estate agent as the purchaser?
- Do I need a lawyer if Im selling my home?
- Do I have to pay off my mortgage before I can put my house up for sale?
- What happens when an offer is made on my house?
- When I sell my home, what fixtures are included in the sale?
- What is a property condition disclosure statement?
- Do I need to add sales tax to the selling price?
- Must I register my home under the new Land Registration Act before I sell?
- When do I have to move out of the house?
Q- What is my first step if I plan to sell my home?
You should get an idea of the market value of your home, that is, what you can expect to sell it for. One way to do this is to get a professional appraisal. They are listed in the yellow pages of the phone book under Appraisers. It costs around $200 for an appraisal. Appraisals are based on what houses similar to yours sell for in your area as well as replacement costs. Another option is to contact a real estate agent. He or she will be able to give you a good idea of what you can expect to sell your house for based on what other houses are selling for in your area.
Q- How do I list my house with a real estate agent?
There are many agents to choose from. You should find someone who knows the area you live in. Family, friends or people you work with may be able to recommend an agent. Real estate agents fees may vary so you should find out as much as you can about how much an agent charges. Some owners choose to sell their house without using an agent and there are businesses that provide services to help people do this for example by providing signs and draft documents. Although this costs less than hiring a agent, you will have to be prepared to advertise and show the property yourself and will not have access to the same resources as a professional agent.
If you decide to hire an agent, you will have to sign a listing agreement. Carefully read through the agreement and be sure that you understand the charges and commissions you can expect to pay and what to expect from the agent. You and your agent will discuss whether it should be a multiple or exclusive listing. Multiple listings give you broader exposure, but you may pay a higher commission. Generally, the agent will be entitled to his or her commission when a buyer who is ready, willing and able signs an offer to purchase your home at the price you and your agent agreed to sell it for. Depending on the listing agreement, even if the transaction falls through, you may still have to pay a commission. You may also have to pay a commission if you sell the house yourself while the listing agreement is in effect, or if you sell it after the listing agreement has expired, and the agent was the effective cause of the sale. For example, the buyer came to an open house arranged by the agent and later makes an offer to purchase after the listing agreement has expired.
Q- Can I have the same real estate agent as the purchaser?
Yes but is recommended you hire a real estate agent that is not representing the purchaser. This is to ensure that he or she will solely serve your interests in the home selling process. If one of your real estate agents clients wishes to purchase your property, the agent must inform you. An agent who represents both the seller and the purchaser, is not permitted to advise one party against the interests of the other party. As the seller you still pay the agents fee.
Q- Do I need a lawyer if Im selling my home?
Yes. Your lawyer will advise you, ensure that the documentation is prepared and that the property is registered prior to closing, receive the money from the purchasers lawyer on closing day, pay off the amount owing on your mortgage, and provide you with an accounting of the proceeds from the sale. You should not use the same lawyer as the purchaser.
Q- Do I have to pay off my mortgage before I can put my house up for sale?
No. You should contact the financial institution holding your mortgage to find out exactly how much is left owing on the mortgage. Find out if you can pay off the mortgage early, and if so, is there a penalty. Ask that this information be put in writing for you. If you sell your home and you owe money on a mortgage, on the closing date for the sale, your lawyer will arrange for the amount owing on the mortgage to be paid off from the proceeds of sale and for a release to be issued by the financial institution. You can also ask the financial institution if the mortgage is assumable. That is, can the purchaser simply take over the mortgage from you, the seller? If it is assumable, will you be released from any further obligations under the mortgage? Again ask for this to be put in writing.
Q- What happens when an offer is made on my house?
Your real estate agent will review any offer made with you in detail. He or she will ensure that you fully understand the offer and you are satisfied with it. If you are not satisfied with the offered price or with any of the conditions, you can reject the offer. You can also make a counter offer. Your real estate agent can help you prepare a counter-offer. You can decide whether to make this your final offer or whether you will consider a counter-offer from the purchaser. If you and purchaser cannot agree on an acceptable offer, you can end the negotiation. If you reach an agreement, the purchaser makes a deposit on the house which is held by the estate agent in trust until closing.
Q- When I sell my home, what fixtures are included in the sale?
When someone buys your house, all fixtures are included, unless you clearly exclude them in the agreement to purchase. Legally, fixtures include anything that is attached to the house in a permanent way so that its removal would leave obvious damage or a scar. Permanent attachment can include anything that is plastered, bolted, screwed or nailed in place. For example, wall to wall carpeting, a sink and central air conditioning would all be considered fixtures, while a throw-rug, free standing cupboard, and washing machine would not, unless you have agreed with the purchaser to include them.
Q- What is a property condition disclosure statement?
A Property Disclosure Statement is a report prepared by the seller for the purchaser. It discloses information known to the seller about the existing condition of the property. It contains information that the seller is aware of about such things as the age of the roof and electrical wiring, any problems with leaks or water damage, etc. Your lawyer can advise you on preparing this statement. The statement may help the purchaser decide whether any aspects of the house need further inspection, for example, the roof, electrical wiring or heating system.
Q- Do I need to add sales tax to the selling price?
Generally speaking no, sales tax (HST) is not collected from the sale of used private homes. I if you are selling the home that you currently live in it is unlikely that you will have to collect HST. However, if you have done significant renovations or the house you are selling is a newly built house, you should contact the Canada Revenue Agency to find out if you need to collect any taxes. You should also talk with your lawyer. The Canada Revenue Agency is listed under Taxes in the government blue pages of your telephone book
Q- Must I register my home under the new Land Registration Act before I sell?
If the home you are selling is not yet registered under the new Land Registration Act, it must be registered before the completion of the sale of the home. This is also referred to as having the property migrated or converted. There is a registration fee. It is up to the purchaser and the seller to negotiate who covers the costs involved. The practice has developed that the seller usually registers the property and pays the registration fee. Usually the cost will be between $500 and $1000 plus tax. Your lawyer can provide advice on this and on other costs involved in selling your home. Once a property is registered under the new registration system it will not need to be registered again. For more information on registering property and the new Land Registration Act you can visit the website of the Land Registration Office of Nova Scotia.
Q- When do I have to move out of the house?
The purchaser is entitled to vacant possession once the funds are released to your lawyer and the sale is complete so you must arrange to move out on or before closing day. Most often the agreement to purchase will contain a closing date. This is the date the house must be vacant. Usually the exact time of day is not included. Keep in mind you do not receive your sale proceeds until the house is vacant, and most often you will require the proceeds to purchase your new home.