Court Confirms Power to Rectify Land Registry

Recently the Ontario Court of Appeal confirmed the courts’ power to correct errors in the land registry, in a decision which overturned a controversial lower court ruling that seemed to undermine the basic premise behind the land titles system as a whole.

The dispute in MacIsaac v. Salo arose between the owners of three adjoining pieces of waterfront land. As part of the legal subdivision by the prior owner, a surveyor had been hired to prepare a reference plan to show the location of an access road, which was intended to form a registered right-of-way.  The goal in preparing the reference plan was to reflect the location of an existing gravel pathway that ran from the main highway, traversed two of the parcels, and led into the third. Unfortunately, the surveyor incorrectly showed the right-of-way as running in a straight line; in reality the gravel road on which it was based curved at one point to avoid a large rock outcrop. The erroneous reference plan was nonetheless deposited in the local land titles office.

When the discrepancy as to the registered right-of-way came to light, it prompted discord and even altercations amongst the three owners, one of whom eventually barricaded a section of the road. The task of removing the outcrop to make the right-of-way conform to reference plan would require substantial blasting and road work.

Two of the owners sued the third for damages, and the surveyor was sued as well.  The court was asked to rectify the registered reference plan as part of the lawsuit’s resolution. The lower court – quite surprisingly – declined to correct the error on the registry, concluding that neither it nor the Director of Titles had the authority to do so.  This conclusion tended to undermine the integrity of the land titles recording system in Ontario.

Fortunately, the Ontario Court of Appeal reversed that decision to allow the title register to be rectified, pointing out that no injustice would arise in this particular case as a result.  
The Court reasoned that under established Ontario land titles law the title register – and the integrity of the information on it – had to prevail over the desire to balance the interests of various innocent parties, even if the outcome to individual landowners appeared to be unfair.
It also considered the nature of the interests that may be affected in the course of such a correction.  While the Land Titles Act did allow a court to order rectification of the register in prescribed circumstances, the issue here was not an erroneous registered instrument (such as a transfer or charge), but rather an incorrect reference plan that had been deposited in the land registry office.  A reference plan’s purpose is to provide a “convenient graphic description of the property being transferred or subject to a charge”; it does not create an “interest in land” itself, and (unlike a survey) is not definitive of the boundaries or extent of the land. These registered documents could therefore be corrected in those cases where they contain a misdescription as to those features.

The Court of Appeal accordingly granted the appeal and ordered the register to be rectified in keeping with a proposed sketch which re-aligned the right-of-way to fit the existing centerline, while avoiding the rock outcrop.  See MacIsaac v. Salo, 2013 (ONCA).