Sale of land to Highways hits a snag at Land Titles

Dear Tony: Our strata corporation negotiated a section of our common property with the B.C. Ministry of Highways for a highway-improvement project. They approached us with an offer for the unused common land that was reasonable.

The owners voted by three-quarters vote to accept the offer, but we are having complications with the Land Title Registry. There appears to be confusion over whether this is a liquidation of the strata or a simple subdivision of common property.

While not all owners agree, 88 per cent of the owners did vote in favour of the proposal. Can you help clarify this and possibly provide some direction? SDL

I doubt I have ever come across a “simple” subdivision of common property. The strata corporation is certainly permitted to do this, but the requirements are very high because the subdivision might have an impact on the value of each strata lot, affecting each homeowner and each interest holder, specifically the banks and lenders who hold mortgages.

The resolution is actually irrelevant in this case, as the form for the subdivision must be filed by the strata corporation and must be signed by every owner registered on title and any interest/charge holder, the mortgage provider.

The other part of your scenario is determining what is a reasonable value. Depending on the commercial use, future intended use of the property and the affect on other properties, the proposed subdivided property may have a much higher value.

Unlike the sale of a strata corporation, where there is an 80 per cent vote to wind up the strata corporation, you are negotiating with only one potential buyer, the Province of B.C.

In this circumstance, there are two conditions the strata may impose as part of the contract: that the strata retain an independent commercial property appraiser and legal representation to assist the strata, and that the strata agree only on the condition that the ministry will pay for these costs and any costs relating to the subdivision and the filing of the required documents in the Land Title Registry.

If a strata corporation is considering winding up, you want to ensure your property is marketed to show its greatest potential and bring the best price to your owners for consideration. The strata corporation, under the instruction of independent legal advice, should engage an independent commercial broker to act as their exclusive agent and to market the property as widely as possible.

Once the offers come in, the lawyer and council review the proposals, terms and conditions and consider when it is time for an info meeting so the owners can ask questions and determine if this is a direction they are interested in.

There may still be room to negotiate and counter offer if the notice for windup has been set up properly. This is a good way to manage legal costs and services and does not require any commitment by the strata owners up to this point.