It becomes the buyer’s problem. The City of Toronto states plainly that “if the work was done by a previous homeowner, you are still responsible for closing the permit” and that “as the current property owner, you are responsible for any outstanding permits.” Under section 12(6) of the Building Code Act, 1992, where an order is registered on title, any person acquiring an interest afterwards is deemed to have been served with it. The limitation period in section 36(8) runs one year from when the chief building official learns of the facts, not from when the work was done, so age is no protection — and an outstanding order never expires. Maximum fines are $50,000 for an individual’s first offence and $10,000 a day for continuing non-compliance. The reason nobody finds out in time: FCT’s own search guidelines mark the building compliance and work order search “search not required” on a residential purchase.
There is work on the property that was never permitted, or a permit that was pulled and never closed. You want to know whose problem it is. The City of Toronto has published the answer in one sentence and it is not the one buyers hope for.
It becomes your problem the day you close
From the City of Toronto’s own page on closing building permits:
“If the work was done by a previous homeowner, you are still responsible for closing the permit.”
“As the current property owner, you are responsible for any outstanding permits. You must confirm with Toronto Building whether any work was completed under the permit.”
The statute does not “transfer” a permit. What transfers is the property, which remains non-compliant, and service of any registered order. Section 12(5)(c) of the Building Code Act, 1992 allows an order to comply to be registered in the land registry office, and section 12(6) provides:
“If an order made under subsection (2) is registered in the proper land registry office, any person acquiring any interest in the land subsequent to the registration of the order shall be deemed to have been served with the order on the day on which the order was served.”
The same registration and deemed-service machinery appears at sections 13(3.1), 14(3.2), 15.2(4) and 15.9(5.3). And enforcement under section 15.9 is directed at “the registered owner” — which, after closing, is you.
An unpermitted basement built in 1998 is not laundered by the passage of time or by three intervening sales. It is a property condition, and the person who owns the property owns the condition.
The limitation period runs from discovery, not from the work
Section 36(8) of the Building Code Act, 1992:
“No proceeding under this section shall be commenced more than one year after the facts on which the proceeding is based first came to the knowledge of… the chief building official.”
Read the trigger carefully. The clock starts when the chief building official finds out, not when the work was done. A 1998 unpermitted basement discovered in 2026 is prosecutable until 2027. And separately, an order made under sections 12, 13, 14, 15.2 or 15.9 does not expire at all — nothing in the Act sunsets an outstanding order.
The fines
| Offence | Maximum fine |
|---|---|
| Individual, first offence | $50,000 (s. 36(3)) |
| Individual, subsequent offence | $100,000 |
| Corporation, first offence | $500,000 (s. 36(4)) |
| Corporation, subsequent offence | $1,500,000 |
| Continuing failure to comply with a stop work or unsafe building order | $10,000 per day, in addition to the above (s. 36(6)) |
Section 36(2) reaches directors and officers personally where they knowingly concur. Section 36(9) directs the proceeds of a fine to the treasurer of the municipality where the offence was committed. The Government of Ontario states the same figures in its own Citizens’ Guide to Land Use Planning.
The order to uncover
Section 13(6) is the provision that should concentrate the mind. A chief building official who has reason to believe that a covered or enclosed part of a building was not built in compliance may order the persons responsible to uncover the part at their own expense for inspection where, among other grounds, “(e) the part has been constructed without a permit being issued.”
And section 15.9(10): where a municipality does remedial work itself, it “shall have a lien on the land” for what it spent, with priority lien status.
The change of use trap
Section 10(1): “Even though no construction is proposed, no person shall change the use of a building or part of a building… if the change would result in an increase in hazard, as determined in accordance with the building code, unless a permit has been issued.”
That is the section that catches a basement converted into a dwelling unit where nothing structural was touched. “We did not build anything” is not an answer to section 10.
Toronto’s 18 months, and why it is not in the statute
The Act allows revocation where, after six months, construction “has not… been seriously commenced”, or where it is “substantially suspended or discontinued for a period of more than one year” (s. 8(10)).
Toronto’s published administrative trigger is different: “If you have an open building permit that is more than 18 months old and no inspections have been requested, you will receive a Notice of Intention to Revoke.” That is municipal practice, not statute.
The City is explicit that a Notice of Intention to Revoke “does not mean your permit has been revoked” — it will be revoked on the date specified if you do not respond. To avoid revocation, you must request an inspection before the deadline “and demonstrate that construction or demolition has genuinely started.”
And the sting: “Be aware that any work completed under the revoked permit may be considered a violation of the Building Code Act and the Toronto Municipal Code.” Letting a permit be revoked does not make the problem go away. It converts a paperwork problem into a compliance one.
The City also notes the transaction consequences plainly: “Open permits may delay or complicate real estate transactions, as potential buyers and lenders may require proof that all construction work was completed and inspected,” and “in some cases, a lawyer may advise against purchasing a property with an outstanding permit.”
How to find out, what it costs, and how long it takes
| Search — City of Toronto | What it tells you | Fee | Turnaround |
|---|---|---|---|
| Property Information Report | “issued building permits on file, the status of inspections and any outstanding orders as they relate to the Ontario Building Code, Zoning By-law and/or Property Standards By-law” | $214.79 per request, effective 1 January 2026 | “approximately five business days” |
| Building records disclosure | The drawings on file | $76.98 per disclosure, effective 1 January 2026 | “within 30 business days” |
The Property Information Report is the one that matters. The City itself says it “is often a requirement before a property transfer can take place and is typically requested as a result of a possible sale or refinancing.” Note it “does not outline permitted use” — it is a compliance search, not a zoning opinion.
Two traps on the records side. Routine disclosure of residential building plans runs only from the twenty-second day after the permit application date until three months following the closing of the permit file. And plans for permits applied for on or before 31 December 2006 are outside the routine disclosure regime entirely. Beyond those windows you are into a freedom of information request.
The reason nobody finds out until it is too late
This is the mechanism, and it is published by a title insurer in its own guidance to lawyers.
FCT’s Ontario Search Guidelines, November 2025, sets out which searches a lawyer needs to run for a title insurance policy to issue. For a single family purchase, under both the homeowner policy and the loan policy columns, the row “Building compliance, zoning, work orders” is marked X. The legend states: “X = search not required.”
Title insurance replaced the off-title compliance search on most residential purchases. So on the ordinary Ontario house purchase, nobody orders the search, nobody discovers the open permit, and it surfaces at the next sale — or when the City writes to the new owner. That is not a scandal. It is a deliberate trade-off, and it is one you can opt out of for $214.79.
FCT does add the caveat: “There may be instances where the Lender may still require you to perform some or all of these searches or instances where it is prudent to conduct some or all of the customary searches.”
What title insurance actually covers here
Every one of the major Canadian policies draws the same line, and it is worth knowing exactly where it falls.
FCT publishes the residential position: the homeowner policy “covers loss resulting from forced removal or remedy of an existing structure built without a permit and/or open permits that would have been revealed by a building compliance search at the date of policy.” The commercial owner policy, by contrast, “doesn’t cover open permits or existing structures built without the required permits.”
TitlePLUS lists as covered risk 22 “work orders, notices of violation or deficiency notices, other than for a fence or boundary wall”, and covered risk 23 addresses being forced by a governmental authority to remove or remedy existing structures.
Stewart Title lists “existing work orders” among its key covered risks.
| Position | |
|---|---|
| Generally covered | A work order, open permit or unpermitted structure that existed at the policy date, was unknown to the insured, and would have shown on the compliance search nobody ran. The insured loss is being forced to remove or remedy — not the cost of work you wanted to do anyway |
| Not covered | Anything the insured “created, allowed or agreed to”. Anything known to the insured and not disclosed to the insurer. Matters disclosed in a home inspection report. The physical quality of the work |
| The second unit | Stewart: where a property contains two to six units, including basement apartments and granny suites, “there is no coverage for the additional units unless a multi-unit endorsement is attached” |
| Six versus seven units | FCT classifies multi-unit residential with more than six units, and mixed-use, as commercial — and its commercial owner policy expressly excludes open permits. A six-plex is residential; a seven-plex is not |
The seller who did the work is the one person the policy will never protect. Chicago Title lists among its exclusions “self-created renovations or changes to your property that may attract zoning by-law violations”. Stewart excludes “risks that the insured created, allowed or agreed to” and “risks that are known to the insured, but not to Stewart Title, on the policy date”.
And Stewart’s own summary is the best single sentence published on this: “Title insurance is not a home warranty product… Title insurance does not insure that appliances and home systems will function properly or that structures constructed on the property comply with prior or current building code requirements.”
Read your own policy rather than this table. Every insurer says so, and they are right.
What I would do, in order
If you are buying:
- Order the Property Information Report. $214.79 and about five business days in Toronto. Your lawyer will not order it unless you ask, because the title insurer does not require it.
- Ask specifically about change of use, not just construction. Section 10 catches a converted basement where nothing was built.
- Ask your title insurer, in writing, what the policy covers for this property — and if there is a second unit, ask about the multi-unit endorsement before closing rather than after.
- Do not tell the insurer nothing and hope. Every policy excludes risks known to the insured and not disclosed. Knowing about a problem and staying quiet is the one thing that guarantees no coverage.
If you are selling:
- Pull the report on your own property before you list. Finding an open permit yourself, with months to deal with it, is a completely different situation from a buyer’s lawyer finding it ten days before closing.
- Request the inspection rather than letting the permit be revoked. Toronto says work completed under a revoked permit may be a violation of the Act and the Municipal Code.
- Understand that your own title policy will not help you. Work you did, allowed or agreed to is excluded across every insurer.
- Get advice on disclosure. RECO’s guidance on latent and patent defects governs what must be told to a buyer, and the underlying duty comes from case law rather than from TRESA.
What is not on this page
No case law. No cost to close out a permit or to legalise a second unit, because no source publishes one and the number depends entirely on what is behind the drywall. No claim about what your particular policy covers — four insurers publish four different sets of words and only yours governs. And no municipal figures outside Toronto, because the fees, the turnaround and the administrative triggers are set municipality by municipality.
Buying or selling in Etobicoke or the GTA with work you are not sure was permitted?
Send me the address before anything else happens. I will tell you what to search, what it costs and how long it takes, and if you are selling I will tell you honestly whether this is something to fix before listing or disclose and price. Finding it yourself with three months is a different problem from a buyer’s lawyer finding it with ten days. No cost and no obligation.
connect@jatindua.com · 437-987-1925 · Book a free consultation
Confidential. Read personally and answered within 24 hours. I never share, sell or distribute your information.
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Frequently asked questions
If the previous owner did the work, is the open permit still my problem?
Yes. The City of Toronto states directly that if the work was done by a previous homeowner you are still responsible for closing the permit, and that as the current property owner you are responsible for any outstanding permits. Nothing in the Building Code Act transfers a permit to a buyer; what transfers is the property, which remains non-compliant, together with service of any registered order. Section 12(6) of the Act provides that where an order is registered in the land registry office, any person acquiring an interest in the land afterwards is deemed to have been served with it on the day it was originally served.
Does unpermitted work eventually become legal with age?
No. Section 36(8) of the Building Code Act, 1992 provides that no proceeding may be commenced more than one year after the facts on which it is based first came to the knowledge of the chief building official. The clock starts on discovery, not on the work, so an unpermitted basement built decades ago and discovered this year is prosecutable for a year from that discovery. Separately, an order made under sections 12, 13, 14, 15.2 or 15.9 does not expire at all, because nothing in the Act sunsets an outstanding order.
What are the fines for building without a permit in Ontario?
Under section 36(3) an individual convicted of an offence is liable to a fine of not more than $50,000 for a first offence and not more than $100,000 for a subsequent one. Under section 36(4) a corporation faces a maximum of $500,000 for a first offence and $1,500,000 for a subsequent one. Section 36(6) adds, for continuing failure to comply with a stop work order or an unsafe building order, a fine of up to $10,000 per day for every day the offence continues. Section 36(2) reaches directors and officers personally where they knowingly concur.
Can the city make me open up finished walls?
Yes. Section 13(6) of the Building Code Act, 1992 permits a chief building official who has reason to believe that a covered or enclosed part of a building was not constructed in compliance to order the persons responsible to uncover the part at their own expense for inspection, and paragraph (e) makes construction without a permit one of the grounds.
I converted the basement but did not build anything. Do I need a permit?
Possibly, and section 10 is the provision to read. Section 10(1) provides that even though no construction is proposed, no person shall change the use of a building or part of a building if the change would result in an increase in hazard as determined in accordance with the building code, unless a permit has been issued. That section catches a basement converted into a dwelling unit where nothing structural was touched.
What is a Notice of Intention to Revoke?
It is Toronto’s administrative step for stale permits. The City states that if you have an open building permit more than eighteen months old and no inspections have been requested, you will receive a Notice of Intention to Revoke, and that the notice does not mean the permit has been revoked but that it will be revoked on the date specified if you do not respond. To avoid revocation you must request an inspection before the deadline and demonstrate that construction has genuinely started. Note that the eighteen months is municipal practice; the statutory triggers in section 8(10) are six months without construction being seriously commenced, or suspension for more than one year.
What happens if I just let the permit be revoked?
The problem changes shape rather than going away. The City of Toronto states that any work completed under a revoked permit may be considered a violation of the Building Code Act and the Toronto Municipal Code, that if uninspected work does not meet safety requirements Toronto Building may issue orders to comply, and that owners who fail to comply may face progressive enforcement including legal action. The City also notes that if you apply for a new permit while an older permit is still open, it may require you to resolve the outstanding permit first.
How do I find out whether there are open permits on a property?
In Toronto, order a Property Information Report. The City describes it as providing information for a specific municipal address on issued building permits on file, the status of inspections and any outstanding orders relating to the Ontario Building Code, the Zoning By-law and the Property Standards By-law. The routine compliance search fee is $214.79 per request effective 1 January 2026 and the City states that processing takes approximately five business days. Note that the report does not outline permitted use, so it is a compliance search rather than a zoning opinion. Fees and processes differ in every other municipality.
Why did my lawyer not find the open permit when I bought?
Because the title insurer does not require the search. FCT’s Ontario Search Guidelines for lawyers, dated November 2025, mark the row for building compliance, zoning and work orders with an X for a single family purchase under both the homeowner policy and the loan policy columns, and the legend states that X means the search is not required for the purpose of issuing a title insurance policy. FCT adds that a lender may still require it or that it may be prudent, but the default on an ordinary residential purchase is that nobody runs it.
Does title insurance cover an open permit?
It depends on the policy and on who created the problem. FCT publishes that its residential homeowner policy covers loss resulting from forced removal or remedy of an existing structure built without a permit and open permits that would have been revealed by a building compliance search at the date of policy, while its commercial owner policy does not cover open permits or existing structures built without required permits. TitlePLUS lists work orders and notices of violation as covered risk 22. Stewart Title lists existing work orders among its key covered risks. Across all of them the coverage is for something that existed at the policy date and was unknown to the insured, and the insured loss is being forced to remove or remedy rather than the cost of work you wanted to do anyway. Read your own policy.
I did the work myself. Will my title insurance cover it?
No. Every published policy excludes it. Stewart Title excludes risks that the insured created, allowed or agreed to, and risks known to the insured but not to Stewart Title on the policy date. Chicago Title lists among its exclusions self-created renovations or changes to the property that may attract zoning by-law violations. The seller who did the work is the one person the policy will never protect.
Does my policy cover the basement apartment?
Not automatically. Stewart Title states that where a property contains two to six units, including basement apartments and granny suites, there is no coverage for the additional units unless a multi-unit endorsement is attached, and only to the extent of the number of units referenced in it. Note also that FCT classifies multi-unit residential with more than six units, and mixed-use properties, as commercial, and its commercial owner policy expressly excludes open permits and structures built without permits. A six-plex is residential; a seven-plex is not.
Related reading
- Seller disclosure in Ontario: latent defects, patent defects and stigma
- Title insurance in Ontario: what it covers, what it does not
- Your home is not selling: what the days-on-market number hides
- Your buyer did not close: the deposit is not automatically yours
Sources
Every figure on this page traces to one of these, and each was read on 1 September 2026. Primary sources only — statute, regulation, and the government or agency that administers the rule. Where I could not verify something from a primary source, the page says so instead of guessing.
- Building Code Act, 1992, S.O. 1992, c. 23. Government of Ontario e-Laws, consolidated text read 1 September 2026 through the e-Laws JSON API; consolidation period from 2 June 2026. Section 8(1) requires a permit before construction or demolition. Section 8(10) permits revocation where work has not seriously commenced after six months or is suspended for more than one year. Section 10 requires a permit for a change of use that increases hazard. Section 12(2) empowers an order to comply; section 12(5)(c) allows it to be registered on title and section 12(6) deems any person acquiring an interest after registration to have been served. Section 13(6)(e) allows an order to uncover work constructed without a permit at the owner’s expense. Section 36(3) and (4) set the maximum fines and section 36(8) sets a one-year limitation running from the chief building official’s knowledge. Accessed 1 September 2026.
- Citizens’ Guide to Land Use Planning: building permits — Government of Ontario. Government of Ontario, page updated 27 July 2026. States that an individual found guilty of an offence under the Building Code Act, 1992 such as building without a permit can be fined up to $50,000 for a first offence and up to $100,000 for subsequent offences, and that a corporation faces a maximum of $500,000 for a first offence and $1,500,000 for subsequent infractions. Accessed 1 September 2026.
- Closing building permits — City of Toronto. City of Toronto, page modified 18 September 2025. States that if the work was done by a previous homeowner the current owner is still responsible for closing the permit, that as the current registered owner you are responsible for any outstanding permits, that an open permit more than eighteen months old with no inspections requested attracts a Notice of Intention to Revoke, and that work completed under a revoked permit may be considered a violation of the Building Code Act and the Toronto Municipal Code. Accessed 1 September 2026.
- Property Information Report — City of Toronto. City of Toronto, page modified 23 July 2026. States that the report provides information on issued building permits on file, the status of inspections and any outstanding orders under the Ontario Building Code, the Zoning By-law and the Property Standards By-law, that processing takes approximately five business days, and that the routine compliance search fee is $214.79 per request effective 1 January 2026. Accessed 1 September 2026.
- Request building records — City of Toronto. City of Toronto, page modified 8 January 2026. States that Toronto Building will endeavour to process requests within thirty business days, that the record disclosure fee is $76.98 per disclosure effective 1 January 2026, and that routine disclosure of residential building plans runs from the twenty-second day after the permit application date to three months following closure of the permit file. Accessed 1 September 2026.
- Ontario Search Guidelines, a reference tool for lawyers and notaries (PDF) — FCT. FCT, document code 02064E_11-25, November 2025. For a single family purchase transaction, under both the homeowner policy and loan policy columns, the row for building compliance, zoning and work orders is marked with an X, and the legend states that X means the search is not required for the purpose of issuing a title insurance policy. Accessed 1 September 2026.
- Understanding title insurance: comparing commercial and residential policies (PDF) — FCT. FCT, document code 01051E_06-25, June 2025. States that the residential homeowner policy covers loss resulting from forced removal or remedy of an existing structure built without a permit and open permits that would have been revealed by a building compliance search at the date of policy, and that the commercial owner policy does not cover open permits or existing structures built without the required permits. Accessed 1 September 2026.
- Sample TitlePLUS owner policy and endorsements (PDF) — LawPRO. LawPRO TitlePLUS sample owner policy, posted August 2021. Covered risk 22 is work orders, notices of violation or deficiency notices other than for a fence or boundary wall, and covered risk 23 addresses being forced by a governmental authority to remove or remedy existing structures. Accessed 1 September 2026.
- Residential owner policy — Stewart Title Canada. Stewart Title Limited, read 1 September 2026, no publication date shown. Lists existing work orders among the key covered risks, and lists among the standard exclusions risks that the insured created, allowed or agreed to, risks known to the insured but not to Stewart Title, and matters disclosed in a home inspection report. States that title insurance does not insure that structures constructed on the property comply with prior or current building code requirements, and that where a property contains two to six units there is no coverage for the additional units without a multi-unit endorsement. Accessed 1 September 2026.
- What does title insurance not cover_ — Chicago Title Insurance Company (Canada). Chicago Title Insurance Company (Canada), 11 August 2022. Lists among the exclusions self-created renovations or changes to the property that may attract zoning by-law violations, and title defects made known to the buyer before purchase. Accessed 1 September 2026.
- Bulletin 7.4, Facts a seller has a legal obligation to disclose (PDF) — RECO. Real Estate Council of Ontario, effective 1 December 2023. States that the seller’s obligation to disclose is based on current case law rather than TRESA, defines patent and latent defects, and notes that an undisclosed latent defect could jeopardise a transaction before it is completed. Accessed 1 September 2026.
About the author — Jatin Dua, Etobicoke real estate agent
I’m the Broker of Record at RE/MAX Quantum Realty, 799 The Queensway in Etobicoke. I write these pages the same way I work a file: read the primary source, quote it, date it, and say plainly where the source is silent or where two sources disagree. If a figure on this page has no citation beside it, that is a mistake and I want to hear about it.
I work with buyers, sellers, renters and investors across Etobicoke, Mimico, Humber Bay Shores, New Toronto, Long Branch, Alderwood and Stonegate–Queensway. connect@jatindua.com or 437-987-1925.