BarTalk April 2003
Volume 15, Number 2

What evil cured; what principle for change?

For the majority of us, issues affecting the ability of a lawyer to conduct real estate transactions are not ‘top of mind.’ Here’s why you should think about it now: the provincial government – supposed advocate of open-markets and healthy regulatory environments for the conduct of business – is proposing new legislation to limit the ability of lawyers to directly assist consumers in the purchase and sale of real estate. At the same time, they are proposing to allow accountants to engage in certain real estate transactions, and to introduce an exclusive market for realtors on most other real estate transactions.

Conducting a transaction that involves significant risks and resources for the consumer requires specific skills, experience, a regulatory framework and adequate insurance in order to protect the public. However, there is no more stringent public protection than the regulatory framework in place when a consumer engages a lawyer who has experience and competency in dealing with real property transactions.

On what principled basis would a government seek to dismiss the public’s right to have a lawyer conduct their real property transaction, and at less cost than with a realtor involved? What is the public policy argument for closing that option for consumers? And why would that option be closed at the same time as the door is newly opened for accountants to engage in the sale of real property as part of the conduct of business of their client? Will lawyers then be permitted to engage in the production of audited financial statements in the conduct of a corporate client’s business?

If the trivializing of the legal profession’s skills, expertise and consumer protection role in any aspect of corporate life doesn’t worry you, it should. If there is a higher standard to be upheld, it is for others to meet the legal profession’s standard. No lawyer is allowed to engage in real property law without being competent to do so; to do otherwise, or to engage in any conduct unbecoming to the high standards of the legal profession, is to risk an entire career in law.

The Minister of Finance’s ‘Real Estate Act Review Discussion Paper’ purports to introduce changes that will provide a “least cost” regulatory regime, “promote competition among participants,” and “protect the public and preserve its confidence in the real estate sector.” Sound principles, all. And the history of lawyer involvement in real estate transactions has met each of those principles squarely: as a self-governing profession, regulatory costs are borne by individual lawyers; lawyers have already been competently and effectively competing in the purchase and sale of real estate in Kamloops, Vancouver Island, Victoria and elsewhere, albeit with resistance from realtor groups, and providing lower cost transactions for consumers in the process; and we have been obligated to be insured since 1971.

The proposed changes beg the question: what evil is cured by this new Act, and what principles are really behind it? At the moment, the Real Estate Board and the government may be the only ones with that answer.

This article was published in the April 2003 issue of BarTalk and is subject to the copyright by the British Columbia Branch of the Canadian Bar Association, 2005, all rights reserved.