Independent Legal Advice & Representation

Certain real estate and financial transactions may require a person to obtain legal advice or representation from a lawyer who is independent of the lawyer acting for another party.

This may arise where the parties have different legal or financial interests, where someone is assuming a significant obligation, or where a lender or another lawyer requires independent advice or separate representation before a transaction can proceed.

Nobari Law Professional Corporation provides independent legal advice and independent legal representation in appropriate Ontario real estate and transactional matters, subject to conflict and professional-responsibility requirements.

Independent Legal Advice, commonly referred to as ILA, involves receiving legal advice from a lawyer who is independent of the other parties and does not have a conflicting interest in the transaction.

The independent lawyer reviews the relevant documents and circumstances with you privately and explains the legal effect of what you are being asked to sign.

Depending on the matter and scope of the retainer, the lawyer may:

• review the relevant documents;
• explain your legal rights and obligations;
• identify significant provisions and potential legal consequences;
• answer your questions;
• discuss the effect of signing the documents; and
• complete a certificate or acknowledgment of independent legal advice where appropriate.

Independent legal advice is more than simply witnessing a signature. The lawyer must have sufficient information and an appropriate opportunity to review the matter and provide meaningful legal advice.

Independent Legal Advice (ILA) and Independent Legal Representation (ILR) involve different roles for the independent lawyer.

With ILA, the lawyer's involvement is generally limited to providing independent advice regarding the particular transaction or documents within the agreed scope of the retainer.

With Independent Legal Representation, the lawyer acts as your lawyer in relation to the matter and represents your interests within the agreed scope of the transaction.

Whether ILA or separate legal representation is appropriate will depend on the parties, the transaction, any lender or lawyer requirements, potential conflicts of interest, and applicable professional-responsibility requirements.

Nobari Law will review the circumstances and confirm whether the firm is able to act and the appropriate scope of legal services.

Independent legal advice or separate representation may arise where a person is:

• guaranteeing another person's mortgage or debt;
• signing a guarantee or indemnity;
• obtaining or providing a private mortgage;
• signing a postponement of an interest or mortgage;
• refinancing property where the parties have different interests;
• transferring property to a spouse or family member;
• adding or removing someone from title to real estate;
• gifting all or part of an interest in property;
• giving up or changing an ownership interest;
• signing mortgage documents where another party is separately represented; or
• involved in another transaction where independent advice or representation is requested or required.

The need for ILA or ILR depends on the particular circumstances. A lender, another lawyer, or another party to the transaction may also require confirmation that independent legal advice or representation has been obtained.

Independent legal advice commonly arises where a person is asked to guarantee another person's mortgage or financial obligations.

A guarantor may become legally responsible for obligations owed by the borrower if the borrower does not comply with the loan or mortgage terms.

Before signing, the guarantor should understand the documents and the obligations being assumed, which may include:

• the amount or obligations covered by the guarantee;
• whether the guarantee is limited or continuing;
• circumstances in which the lender may seek payment;
• whether the guarantor's property or other assets may be affected;
• rights or remedies available to the lender;
• circumstances in which the guarantee may continue; and
• the potential consequences of borrower default.

The particular rights and obligations will depend on the mortgage, guarantee, commitment, and other documents involved.

Independent advice may also be required for a spouse, co-owner, person postponing an interest, or another party whose interests differ from those of the borrower or lender.

Independent legal advice or separate representation may also arise where ownership of real estate is being changed between spouses, family members, co-owners, or other parties.

Examples include:

• adding a spouse, child, parent, or other person to title;
• removing an existing owner from title;
• transferring property between spouses;
• transferring property following a separation;
• gifting all or part of a property;
• transferring an interest for nominal or no monetary payment; or
• changing ownership while a mortgage or secured line of credit remains registered against the property.

The person transferring an ownership interest and the person receiving that interest may have different legal and financial interests.

A property transfer may also involve mortgage, land transfer tax, income-tax, family-law, and estate-planning considerations. Nobari Law provides legal advice within the agreed scope of the retainer. Accounting, tax, financial, family-law, or other professional advice should be obtained from appropriately qualified professionals where required.

Before the appointment, Nobari Law will generally need to receive the relevant documents and sufficient information about the proposed transaction.

The lawyer will meet with you independently and will generally discuss the matter privately without another interested party participating in the consultation.

Depending on the transaction, the lawyer may:

• confirm your identity;
• discuss your understanding of the transaction;
• review the relevant documents;
• explain the legal effect of the documents;
• discuss significant obligations and potential consequences;
• answer your questions;
• confirm your instructions and decision about whether to proceed; and
• determine whether any requested certificate or acknowledgment of independent legal advice can appropriately be completed.

Additional steps may be required depending on the nature of the transaction, the documents involved, and the requirements of another lawyer or lender.

An appointment does not automatically mean that an acknowledgment or certificate of independent legal advice can be completed. The lawyer must first review the circumstances, documents, and information provided and determine whether it is appropriate to do so.

You may be asked to provide:

• valid, current identification and any additional information required for identity verification;
• the documents you have been asked to sign;
• the name and contact information of the lawyer requesting the independent advice or representation;
• information about the parties and the proposed transaction;
• the property address, where applicable;
• mortgage or refinancing information, where applicable;
• the mortgage commitment, guarantee, postponement, transfer, or other relevant documents;
• information about your relationship to the other parties; and
• any certificate, acknowledgment, instructions, or forms requested by the other lawyer or lender.

Additional documents or information may be required after the matter has been reviewed.

Documents should be provided sufficiently in advance to allow an appropriate opportunity for legal review before the appointment or transaction deadline.

Do not send original documents, identification, complete account numbers, passwords, or other sensitive information unless requested by Nobari Law Professional Corporation. If requested, please use the document-sending method confirmed by the firm.

Nobari Law Professional Corporation provides independent legal advice and independent legal representation in appropriate Ontario real estate and transactional matters.

Depending on the circumstances and scope of the retainer, our services may include:

• reviewing relevant transaction documents;
• explaining legal rights, obligations, and potential consequences;
• providing independent advice regarding mortgages, guarantees, postponements, property transfers, and other transactional documents;
• answering questions regarding the proposed transaction;
• acting as separate legal counsel where independent representation is required and the firm is able to accept the retainer; and
• completing a certificate or acknowledgment of independent legal advice where appropriate.

Before accepting the matter, Nobari Law will review the parties and circumstances, complete the necessary conflict check, and confirm whether the firm is able to provide the requested legal services.

If you have been advised that you require independent legal advice or separate legal representation for a real estate, mortgage, guarantee, property transfer, or related transaction, contact Nobari Law Professional Corporation to discuss the documents and legal services required.