When the Civil Code of Quebec1 (“C.C.Q.”) was adopted in 1991, the legislator envisioned a significant reform to the publication of rights regime in Quebec. This reform, which entered into force in 1994, sought to restructure registry offices and to standardize the registry for the publication of rights. Moreover, the reform was accompanied by a legal reform that aimed, inter alia, at giving probative value to the Quebec land registry. However, the legislator abandoned its reform program in December 2000, noticing among others aspects, the important costs incurred by this reform and its consequences on notaries’ professional responsibility.

Facts

The Ostiguy v Allie2 case involves the owners of adjacent lots. Between 1994 and 2001, Ms. Hélène Allie used one or two parking spaces situated on her neighbor’s lot, without any opposition from the latter. In 2011, M. Alain Ostiguy and Ms. Valérie Savard acquired said lot and required that Ms. Allie no longer park her vehicle there. Ms. Allie refused to comply with such request, claiming that she had acquired the two parking spaces by way of acquisitive prescription. Following such refusal, the Ostiguy-Savard couple filed an application for an injunction in order to have their rights recognized. The couple held that their property title, registered at the land registry, took precedence on the peaceful, continuous, public and unequivocal possession by Ms. Allie over the span of ten years in the absence of a judgement obtained by her pursuant to article 2918 C.C.Q.

In first instance, the judge was of the opinion that Ms. Allie had acquired one of the two claimed parking spaces by way of acquisitive prescription. The decision of the Superior Court3 was subsequently confirmed by the Court of Appeal.4

The Supreme Court of Canada’s (“SCC”) Analysis

The SCC was then called to determine whether right of ownership acquired by prescription that had not been the subject of judicial application could be set up against a new owner of an immovable who had registered title in the land register. From the outset, the SCC highlighted the fact that both parties had acquired their rights legitimately. The Ostiguy-Savard couple had acquired title by act of sale duly registered at the land registry whereas Ms. Allie had acquired her right of ownership by way of acquisitive prescription, in accordance with the provisions of the C.C.Q. Consequently, the SCC had to define and contrast the respective roles of acquisitive prescription and the publication of rights system in Quebec civil law in order to resolve the dispute.

First, the SCC underlined that the primary function of acquisitive prescription is to ensure the stability of property rights by helping true owners prove their rights. Prescriptive acquisitions enables third parties to acquire property by the lapse of time in accordance with the conditions provided for in the C.C.Q. Additionally, the SCC underlined that the possessor claiming ownership of an immoveable must demonstrate that he has possessed such immovable as an owner for at least 10 years. The SCC then went on to analyze article 2918 C.C.Q., which provides that a possessor must obtain a judgement confirming the right so acquired. In that respect, the SCC noted that a certain debate exists among academic authors and throughout case law regarding the right-granting or declarative role of a judgement under article 2918 C.C.Q. Noting that the response to this question was not pertinent for the purposes of the dispute, the SCC nonetheless confirmed that a judgement under article 2918 C.C.Q. has a declarative character and that it is the constant possession of the possessor that gives rise to the right of ownership. Thus, according to the SCC, the inaction of Ms. Allie after the passing of the 10 year period provided for in the C.C.Q. was not an obstacle to the acquisition of her right to park on the Ostiguy-Savard couple’s lot by way of acquisitive prescription.

The SCC went on to examine the role of publication of rights in Quebec civil law. In that regards, it underlined that the role of publication of rights in Quebec is limited to, among others, allowing rights to be set up against third parties, establishing their rank and, where the law so provides, giving them effect. According to the SCC, the publication of rights does not create a right of ownership per se. The SCC underlined that, although the legislator has previously wished to confer a probative value to the land registry by means of the 1994 reform, said reform was never carried through. Thus, the SCC concluded that the literal interpretation of article 2918 C.C.Q. advocated by the Ostiguy-Savard couple was incompatible with many provisions of the C.C.Q. Relying on, inter alia, the journal of the Parliamentary Commission debates, the SCC concluded that by abandoning the 1994 reform, the legislator “intended to stick with the situation that had existed under the C.C.L.C. [Civil Code of Lower Canada]”.

In light of the above, the SCC concluded that acquisitive prescription operates regardless of the rights registered in the land registry. By way of its decision, the SCC reaffirmed acquisitive prescription’s place in Quebec civil law and recognized the limited role of the publication of rights.

Ostiguy Case Key Takeaways

This judgment is of interest for any professional in the real estate field:

  • First, the judgment confirms that the registration of a title deed does not interrupt and does not annul acquisitive prescription. In practical terms, the possessor will not need to take legal action in order to obtain a judgment under 2918 C.C.Q. as soon as the prescription is achieved (although it may be prudent to do so).
  • The judgement seems to confirm that article 2918 C.C.Q. does not modify the applicable regime, being that the passing of a 10 year period of proper possession operates prescription without any other formality. Practically speaking, this interpretation will reduce the coverage period for title examinations to a minimum of 10 years (versus an examination until January 1, 1964).5 It will be interesting to see how the practice will position itself in the future regarding this possibility.
  • Furthermore, this judgment puts in evidence the “limits” of our publication of rights system. Although the conclusions of this judgment might benefit title-insurers, notaries and lawyers mandated to carry out title examinations will, in our opinion, have to exercise caution when drafting their opinions on titles, by providing precise reservations for cases of possession not identified on a location certificate, which could vitiate the owner’s title.
  • Notaries and lawyers helping to draft acts of sale should include representations and warranties clauses in order to clearly set out the responsibility and recourses for a title being vitiated by a ten year prescription.