Validation Certificates in Ontario
Section 57(1) of the Planning Act (the “Act”) allows a council authorized to grant consents the ability to issue what is known as a “certificate of validation”. These certificates state that a prior contravention of the subdivision control provisions of the Act are deemed to have never had the effect of preventing the conveyance of land or the creation of an interest in land.
Put simply, a validation certificate corrects a Planning Act breach that has already occurred – it “turns back the clock” to re-fuse the chain of title.
For example, if John Smith owned Parcel A, and then purchased the abutting Parcel B, the effect of the transaction may be that Parcels A and B merge into a single parcel on title – even if they have independent parcel identification numbers (PINs).
If Parcels A and B have merged, and John Smith then sells Parcel A to Tim Jones – a third party – the sale is invalidated as it breaches section 50 of the Act. In addition, if Tim Jones registered a mortgage on title to Parcel A, the mortgage would also be invalidated.
In this case, a validation certificate for the sale of Parcel A would validate that conveyance as well as the subsequent mortgage by deeming that the contravention of s.50 of the Act to never have prevented the conveyance of Parcel A (thus also validating the subsequent mortgage).
Validation certificates must include both the effect of the validation and a precise legal description of the land subject to the offending conveyance. The certificate becomes legally “valid” from the moment it is issued and has the retroactive effect of curing any other earlier conveyancing mistakes or errors. Though typically used to cure prior contraventions, the issuance of a certificate is not dependent on a subsequent transaction and may be applied for in anticipation of a conveyance or mortgage.
Unlike other Planning Act applications, the stated registered owner of the subject land need not be the applicant for a validation certificate. In fact, there is no restriction on who can make the application. There is often good reason for this latitude. For example, the bank in the example above may seek to enforce the mortgage that was invalidated by the conveyance of Parcel A after its merger with Parcel B. Often it is a frustrated owner of land or mortgagee that applies for a validation certificate.
While the authority to grant validation certificates is vested in the council or a committee authorized to give consents under Section 53 of the Act, applications for validation certificates are not governed by the same procedural rules, submission or notice requirements. This follows logically as validation certificates do not create a new lot – they seek only to restore previously existing lot lines that were inadvertently lost. Also, the need for a validation certificate is often only discovered on the eve of a transaction’s closing. Especially in the context of a residential transaction, when moving trucks are packed and ready to unload, applications for validation certificates require a swift response.
In issuing a validation certificate, a council or committee shall have regard to the same criteria as when considering a consent application (found in subsection 51(24) of the Act). Additionally, Ontario Regulation 144/95 requires the validation certificate to conform to (but not comply with) any applicable official plan, zoning by-law or ministerial zoning order.
These criteria should be accessed in light of the applicable circumstances.
The overall intent of Section 57(1) is to provide a method of fixing an inadvertent breach of the Act in order to avoid the requirement of a consent application.
In some cases, a parcel may not (or may no longer) comply with applicable zoning by-law standards. But for the ability to obtain a validation certificate, the owner would be required to apply for a consent to re-sever the parcel. This may also require a variance or rezoning application, to ensure compliance with the applicable zoning by-law. However, the consent, variance and rezoning application processes are far more onerous and may create an undue burden and risks in the circumstances. Therefore, as the regulation specifically requires conformity (rather than compliance) with applicable zoning, the question of unnecessary cost, legal non-conforming status, the burden of addressing an inadvertent error and fairness should be considered in assessing whether a council or committee should grant a validation certificate.