Few and far between!! Of 843 real estate related claims since 2001 to July 2006, only nine have been re-lated to the Protocol. It is estimated that the Protocol has been used on thousands of closings in Alberta and the claims experience is neglible. When using the Protocol, all the usual standards of the prudent real estate practitioner still must be taken. Use your best judgment. There are circumstances where the Protocol may not fit. The requirements of prudent practice, including special practices regarding multiple representations, transac-tions involving divorce/matrimonial property, leasehold properties, rev-enue properties and condominiums still must be followed. If you have questions on the Protocol, do not hesitate to contact the Practice Advisors’ Office - Nancy Carruthers (Calgary 1-866-440-4640) or Ross McLeod (Edmonton 1-800-661-2135). For more information, visit the Law Society of Alberta website at:
www.lawsocietyalberta.com
/resources/conveyancing
Protocol/westerntorrens.cfm. 
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What is the Western Law Societies Conveyancing Protocol?
by Steve Raby QC, Bencher
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The Protocol is a set of revised real estate practice standards available for use by those lawyers covered by the existing mandatory lawyers’ insurance programs to facilitate the expeditious closing of residential real es-tate transactions. It is not that much different from how a real estate transaction is completed “the old way” but it does require a shift in thinking. The Protocol obviates the need for a transfer back, the tenancy at will and an unpaid vendors’ lien caveat. It may also obviate the need for interim financing. It allows the release of funds on the closing day without having to wait for confirma-tion of registration of the transfer and the mortgage.
When can you use the Protocol?
- Cash deals
- Cash to assumption of mortgage
- Cash to new mortgage transactions where the lender provides Protocol instructions
- Re-financings where the lender provides Protocol instructions
- See list of lenders on the LSA website. This list may not be exhaustive, so check your lender instructions and ask!
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What does it apply to?
- Residential real estate transactions
- Single family dwelling (including in Alberta rental and vacation properties not exceeding four units)
- Multi-family or existing condominium units to a maximum of four (4) units
- Existing condominiums
- Turnkey new homes (in Alberta):
- lien period must have expired and/or lien fund held
- RPR recommended for the purchaser and lender
- Leasehold titles within national parks in Alberta.
What does it not apply to?
- Commercial real estate
- Agricultural properties
- Mortgages on new construction where the mortgage is a “draw” mortgage
- Sale of a condo unit by a developer (section 14(3) of the Condominium Property Act)
- Unrepresented party on the other side
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How do you close a transaction using the Protocol?
- First, read the Protocol. For Alberta, the seller’s lawyer’s process is in Part D and the buyer’s lawyer’s process is in Part E. In Protocol transactions:
- Conduct all the same due diligence.
- Conduct all the same searches,
- Prepare the mortgage documentation the same way,
- Calculate the statement of adjustments and shortfall funds the same way, and
- Pay out mortgages and pay real estate commissions the same way.
- Ensure that the lender instructions provide for a Protocol closing. Follow the lender’s instructions and check the lender’s reporting requirement. Some lenders want the short form opinion; others have their own form.
- The Protocol does not change the obligations under the real estate purchase contract
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Real Property Reports (building location certificates)
- Lenders:
- The Protocol provides that a residential real estate closing can proceed without a real property report for a lender. This works well for re-financings as well.
- An opinion can be provided to the lender that an RPR is not necessary unless there is a known defect.
- Buyers:
- We start from the premise that the buyer needs and wants to know the state of the property upon purchase.
- The standard Alberta Real Estate Association real estate purchase contract provides that the seller is to provide the buyer with an RPR with municipal compliance (or non-conformance). It is necessary therefore to handle the RPR and compliance before closing.
- In Alberta, if the standard contract is not used or the RPR clause has been crossed out, advise the buyer of the options. If the buyer does not want an RPR, obtain a specific waiver from the buyer confirming they have decided to proceed without an RPR.
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