Our last email discussed an issue I saw regarding utility lots. We thought it was a utility lot because the RPR showed it had the usual utility lot designation (described as 'lot 10U'). Upon further examination of the Compliance Certificate Report that came with the RPR, it turned out to be a 'road right of way.' 

When subdivisions are created from raw land, municipalities often require reserves of land for municipal purposes. Those purposes can include what are known as 'utility lots,' where the municipality might run their pipes and wires AND, in addition to this, road right of ways for potential new roads.

For our client who thought he was buying a huge lot, it didn't matter whether the extra chunk of land was a utility lot or a road right of way lot. He just wanted that big lot!

It turns out that, technically, it makes a difference whether it's a utility lot or a road right of way lot:

• Utility lots can be purchased or leased from the City. Contact the Property Management Department and ask for a leasing agent.
• Road right of way lots cannot be purchased or leased.

We reviewed the Compliance, which noted that if a homeowner really wanted to purchase a road right of way lot, the process would be as follows:

1. Contact the City Property Management Department.
2. The City will determine if they have any future need for the lot.
3. If not, the homeowner can make an application to the City to change the lot designation from road right of way to utility lot.
4. Then, the homeowner can apply to the City to lease or purchase what is now a utility lot.

Our comments are based on the City of Edmonton bylaws. Please check with other municipalities for local rules. 

This is a tricky area for both Buyer's and Seller's realtors. As we highlighted in our last email, as a Buyer's Realtor, if a lot appears to be bigger than normal, you have to dig deeper. Ask the Sellers Realtor if there is a utility lot. Get a copy of the subdivision plan from Land Titles. The cost is the same as a title. Print it big and determine why the lot is larger than it should be. Is there an adjoining utility lot? Or maybe it's a road right of way lot. 

As a Seller's Realtor, I think your listing should reference the utility lot (or road right of way lot). Remember: for the matter above, our Buyer client wanted to sue the Seller's Realtor for misrepresentation.  

Don't let that happen to you.

Protect yourself.

Cheers,

Barry

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Field Law when you write your next deal.