Another reason to get title insurance
If BC courts follow the reasoning of an Ontario Appeal Court decision, title insurance could cover the costs of rectifying defects that are only discoverable with “off-title” searches. In the Ontario case of MacDonald v. Chicago Title Insurance Company of Canada, 2015 ONCA 842 (CanLII) a couple who bought their home discovered many years later that a bearing wall had been removed illegally by the former owner. The City issued an order to remedy the unsafe building which the homeowners complied with. They then made a claim against their title insurance. The insurer denied the insurance claim forcing the homeowners to proceed to court. The Motion Judge hearing the action agreed with the insurer that the defect complained of was not covered by the policy. The Ontario Court of Appeal unanimously disagreed. It found that “off title” defects are included within the meaning of “what is covered” under the policy.
When you’re in the market to buy a home ask about a homeowner’s title insurance policy. Many financial institutions demand that a buyer purchase a lender’s title insurance policy but this will not cover the homeowner’s interest. If you already own a home and do not have title insurance (homeowner’s policy), you may still be able to purchase one. Speak to your lawyer to see if title insurance is right for you.