Before buying a property, it’s important to investigate all angles. You’ve likely heard it said: “Location, Location, Location.” Todays buyers are constantly reminded that, while one can modify structural deficiencies and irregular layouts, location of Real Estate never changes. Proximity to public services, such as transit and healthcare can be a large convenience and make the difference between liking, and loving where you live.
Unfortunately, the pros of proximity to Municipal services can often carry with them a price: the possibility of Expropriation. Home buyers and owners alike should be aware of the possibility of Expropriation, be familiar with the process, and know their rights if they are served with such notice.
What is Expropriation?
Expropriation is the act wherein the Government acquires private property from landowners for a public purpose. It is act of the Government exercising the power of Eminent Domain.
How does Expropriation Work?
The process of Expropriation in Ontario is quite straightforward.
1. Notice of Intention for Approval to Expropriate
The first step involves formal notice to be served on landowners of the Government’s intention to seek approval for Expropriation. This notice is also posted in local newspapers for a period of 3 weeks.
During the period of notice, the landowner can submit an inquiry as to whether the nature of the expropriation is considered “fair”. This request involves assigning an Inquiry officer to conduct an independent review and prepare a report for the Expropriating Body.
It’s important to note that, even if the inquiry officer’s report deems the Expropriation to be unfair, Approval to Expropriate may still be granted.
2. Registration of Expropriation on Title
Once Approval of Expropriation is granted, the plan of Expropriation is registered on Title to the property and served to the owner.
3. Appraisal of Lands & Compensation Offer
The Expropriating Authority conducts an appraisal of the lands to determine what is deemed “fair value” for the portion of land being Expropriated. A compensation offer is drafted and presented to the owner.
The owner can either:
- Accept the offer as full settlement for Expropriation
- Choose to accept the offer “Without Prejudice”. In this case, the owner can receive compensation, but reserves their right to claim more than the amount offered through negotiation or appeal.
Negotiation proceedings are often performed informally with the Expropriation authority, as well as by way of formal dispute. Owners can request an appeal regarding the compensation from the Local Planning Appeal Tribunal (LPAT). If still unsatisfied, the owner may appeal to a divisional court.
Length of Expropriation
Generally, Expropriation proceedings are completed within 12 Months. However, timelines can vary. Should the owner be willing to cooperate and the appropriate plans drafted, Expropriation can complete in as little as 4 months. Situations that may be more complicated could take longer to complete.
Expropriation and Compensation
Expropriation Compensation can be based on any or all of the following factors:
- Market Value of the Land. The Market value must be taken for the land as-is, without taking into consideration the value of the public improvements, or the possible decrease in value of the overall property due to the nature of the expropriation and disturbance.
- Damages for Disturbance:
- Damages for the inconvenience of Relocating, if the owner will be required to relocate.
- Compensation for expenses occurred in moving to a new residence, typically an additional 5% of the “market value”.
- Damages for Injurious Affection (the reduction in market value to the property following Expropriation)
- Damages for difficulties in relocation (for example, if the owner has a handicap and the new residence must be made wheelchair accessible)
- Other reasonable costs, such as legal fees & disbursements incurred in negotiating & Appealing Expropriation.
Expropriation can be an incredible inconvenience for a land owner. In addition to the hassle of losing a portion of property, homeowners can experience trials in trying to navigate the Appeal & compensation negotiation process.
ReaLawState’s team of expert Lawyers can assist with all stages of Expropriation, including negotiation of Settlement. If you are having issues or have questions related to Expropriation, contact us for assistance.