The Ontario government recently made a series of changes to the Planning Act that may have a positive effect for those who own adjoining properties. One change in particular has altered the rules surrounding the merger of abutting land as a result of the death of a joint tenant on title.
Families who own adjoining properties have often held title as joint tenants on one property and by only one of the family members on the other. This strategy was typically used to prevent the merging of the properties, allowing the owners to convey each lot separately. Under the Planning Act, adjoining or abutting properties would automatically merge if they had the same ownership. Issues would arise when one of the joint tenants would pass away and due to the right of survivorship, the other tenant would become the sole owner. If that owner was the sole owner of the abutting land, then the properties would merge into one.
Merging is problematic due to Section 50(3) and 50(5) of the Planning Act which prohibits the conveyance of adjoining land or part of a lot in Ontario unless one of the prescribed exceptions applies. For example, a person may not retain any abutting land in a conveyance of their property unless they receive a consent or fall under an exception in sections 50(3)(b) or 50(5)(a). In the event that the properties merge into one, selling just the previously separate land would contravene the Planning Act as the owner is both retaining adjoining land and conveying only part of their lot. The property owner would likely require a consent from a committee of adjustments in order to convey part of their newly merged property, regardless of the fact that the land was once its own separate lot.
Recent changes to the Planning Act, however, appear to remedy this issue. The new additions to the Planning Act under section 50(3)(a.1) and under section 50(5)(a.2) address mergers of adjoining properties resulting from the death of one of the joint tenants. The new provisions create an exception for these types of mergers allowing owners to convey the previously separate land provided that “the land is the whole of a parcel of land that was previously owned by, or abutted land previously owned by, joint tenants and the ownership would have, but for this clause, merged in the person as a result of the death of one of the joint tenants” (S.50(3)(a.1). This new legislation should be a welcome change for those with adjoining land as it will reduce the frustration, headaches, and costs associated with these types of merged properties.
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