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.
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.
- 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.
Pursuant to its records policy (see 2D), the land trust keeps originals of all irreplaceable documents essential to the defence of each transaction (such as legal agreements, critical correspondence, surveys, appraisals, and baseline documents) in one location, and copies in a separate location. Original documents are protected from daily use and are secure from fire, floods and other damage. (See 2D).
A land trust should prepare and maintain complete written documentation of transactions. It needs to have two sets of documents: (1) documents that are accessible and can be used for monitoring or as problems and issues arise (“working” files); and (2) documents that are safely stored in a way that ensures that they will last and be acceptable evidence in the event of a court proceeding (“permanent” files). Originals of important documents (such as legal agreements, critical correspondence, baseline documents or one-of-a-kind studies) that are part of the permanent file should be kept in a secure place, such as a safe-deposit box or fireproof file cabinet. For additional protection, working files should be kept in one location and permanent files should be kept at a separate location. As with financial records, land trusts should consider creating electronic backups of all transaction-related files for off-site storage. See also 2D.
BC Assessment Questions
- Does the land trust have a written records management policy?
- Does the land trust maintain copies of permanent files in a separate, secure location?
- Does the land trust maintain a set of working files for everyday use by staff, volunteers and others?
- Property Data:
- i) does the land trust keep this data in both a database, and original material in hard copies (binders) which are catalogues, labeled, copied and kept offsite?
- ii) does the land trust ensure that property data is transferred to the BC Land Trust Alliance’s Registry or the Conservation database (in 2010 custodian is Ducks Unlimited)?
CLTA Assessment Questions
- Are originals of irreplaceable documents kept in a secure location, safe from fire, weather, etc.?
- Are back-up copies kept in a separate location?