Standard 9: Ensuring Sound Transactions
The land trust works diligently to see that every land and conservation agreement transaction is legally, ethically and technically sound.
Background
A land trust usually intends to protect the property it conserves in perpetuity. To help secure the perpetual conservation of land, its transactions must hold up over time and withstand challenges. Sound transactions rely on the land trust performing “due diligence” in its transaction steps. Land trust representatives need not be lawyers, but they must have good legal advice, and they should familiarize themselves with basic principles of real estate and tax law. The land trust should draw a landowner’s attention to issues that must be addressed as the transaction proceeds. However, a land trust should not represent itself as giving specific legal or financial advice; a landowner’s own advisors should do that. A land trust may have to call on other financial and technical experts in order to complete the transaction. Carefully documenting the steps a land trust takes in performing its due diligence can help secure the perpetual conservation of the property.
Relevant Law
- Property Law Act, RSBC 1996, c. 377, s. 35.
- Land Title Act, RSBC 1996, c. 250, s. 218-223.
- Canada Revenue Agency policy interpretation of Income Tax Act, SC 1985, c. I; see:
- Environmental Management Act, SBC 2003, c. 53, s. 40
- Contaminated Sites Regulation, BC Reg. 375/96, as am., s. 3.
- Land Title Act, RSBC 1996, c. 250, Parts 10 and 10.1
- Canada Revenue Agency policy interpretation of Income Tax Act, SC 1985, c. I;
see Income Tax Technical News No. 26 at:
- Taxation (Rural Area) Act, RSBC 1996, c. 447.
- School Act, RSBC 1996, c. 412.
- Police Act, RSBC 1996, c. 367.
- Property Transfer Tax Act, RSBC 1996, c. 378.
- Social Service Tax Act, RSBC 1996, c. 431.
PRACTICE
E. Conservation Agreement Drafting
Every conservation agreement is tailored for the property according to project planning (see 8F) and: identifies the important conservation values protected; allows only permitted uses and/or reserved rights that will not significantly impair the important conservation values; contains only restrictions that the land trust is capable of monitoring; and is enforceable.
Background
This practice is integrally linked with 8F, project planning, and reflects the integration between conservation agreement planning, drafting and enforceability. The actual drafting of a conservation agreement should implement the project plan. Restrictions should be drafted to ensure that important conservation values are not significantly impaired, and in a way that ensures public benefit and maintains the credibility of the land trust. A conservation agreement’s restrictions must be monitored and enforceable, and a clear statement of the conservation agreement purpose must support them. Future interpretation of a conservation agreement rests on how clearly the document explains the restrictions and their intent, as well as on how enforceable the restrictions are.
Assessment Questions
BC Assessment Questions
- Does the land trust request a written description from a landowner, outlining the values they wish to have protected by a conservation covenant?
- Does the land trust’s covenant template use clear, concise language that is easily understood and is not subject to interpretation?
- Does the land trust use a covenant template modeled on the template provided in Greening Your Title?
- Do the land trust’s covenants:
- a. Identify the conservation values that are being protected
- b. Allow only those permitted uses that will not damage those conservation values
- c. Contain restrictions that are enforceable and can be monitored
CLTA Assessment Questions
- When drafting conservation agreements, the land trust (check all that apply):
- Uses experienced professionals to draft the conservation agreement document
- Identifies the important conservation values to be protected
- Uses measurable standards for conservation agreement terms, or if impractical, refers to accepted standards
- Allows only permitted uses and/or reserved rights that will not significantly impair the important conservation values
- Avoids restrictions that cannot be monitored or are unenforceable
- Ensures that the conservation agreement deed is clear and enforceable by the organization
- Clearly documents public benefit served
Resources: Example Policies & Template Documents
Template Documents
- Sample Reserved Rights
- DUC CVLT Sample Covenant Terms
- ITF NAPTEP Standard Covenant
- CVLT Covenant Terms of inst 2005
- Greening Your Title 2nd edition
- TLC QICSS Linnea Farm Covenant
- TLC Restrictions Handout for Owners 2007
- TLC Gowland Pt Covenant
- TLC No Sale No Mortgage Covenant Problem
- TLC Covenant Steps
- NCC Covenant Clauses
- DUC Legal Intro Std Covenant
- TLC NALT Winchelsea Covenant
- TLC Covenant Example No Subdivision
- TLC Covenant Restrictions Examples
- DUC Mud Bay Covenant
- TLC Land Title Act Form (2 covenant holders)
- CVLT NTBC Bloomfield Covenant Terms of inst
- CVLT NTBC Bloomfield Covenant Referral Sample
