Ambiguous Condo Docs Cause Another Dispute

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bookI’m often asked to review condominium documents because the language used is not clear. One reason is the legalese used by many lawyers when drafting the documents. (“Now herewithin witnesseth” really?). Do we think it makes us sound smart? Whatever the reason, it needs to stop!

If we want the owners to read the documents (and we should) we need to make them easy to read. The owners shouldn’t need a law degree to understand them! Plain, clear, and unambiguous language needs to become the norm.

Why am I ranting about this today? Because I just read another case where a dispute arose because of unclear language in the declaration.

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How to Calculate the First Year Budget Deficit

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Unfortunately, many budget statements are grossly inadequate, which leads to significant deficits in the first year and sharp increases in fees in subsequent years. The fees are kept unreasonably low and/or expenses are estimated at unrealistic amounts to make it seem like a better purchase than it really is. Luckily for condominiums and owners, there is a remedy available to them.  Continue reading

Owner not oppressed by by-law restricting use of parking spaces

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I recently read an interesting case about parking rights in a commercial condominium. The applicant was the owner of three units, which were leased for use as a restaurant. The owner commenced an application against her condominium after it passed a by-law restricting parking in common element spaces.

Historically parking was allocated on a first-come, first-served basis. This led to problems with insufficient parking for customers and employees of many of the units. In 2009 the Board passed a by-law to change the allocation of parking spaces. The by-law allocated two parking spots to each unit. In 2014 the Board discovered that the by-law was never registered so it was not valid. The Board passed another by-law in 2015 to fix the problem. The 2015 by-law increased the number of parking spaces per unit to four. The result was that the restaurant had significantly less available parking for its customers.

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FAQs: Owner Edition

Like any blogger, I regularly receive emails from people about my posts. Sometimes it is managers. Sometimes directors. Often it is frustrated owners with no where to turn for answers. Sometimes there is a legitimate reason for their frustration (i.e. the board made a decision contrary to the Act), but often it is because the owners have misinterpreted a provision of the Act or the declaration, by-laws or rules. I thought that I would take a few minutes today to answer some of the most common questions that I receive from owners in hopes that it eases the tension in some condominiums.

Question: “My board changed management companies without a vote of owners. Can they do that?”

Answer: Yes, in most instances. The board is responsible for managing the affairs of the condominium, which includes the manager. In some circumstances, such as where the condominium goes from self-managed to professionally managed, the board may want to get a legal opinion before making the change to ensure it does not trigger any of the notice requirements of Act.

Question: “One of the board members quit. The other ones replaced her without a vote of the owners. Can they do that?”

Answer: Yes, in most instances. Section 34(2) of the Act permits the board to appoint a qualified person to hold office as a director until the next AGM as long as a quorum remains in office. For instance, a 3 member board has 1 person resign. The other 2 can appoint a director. If 2 people resigned the remaining director would need to call an owners’ meeting to elect new directors pursuant to section 34(4) of the Act.

Question: “The property manager wants me to pay to get a copy of minutes and other documents. Can they do that? What is a reasonable rate?”

Answer: Yes. Section 55(6) of the Act permits the condominium to charge a “reasonable fee” for copying and labour charges. What is reasonable? There is no prescribed amount. It should depend upon the circumstances, such as the location of the record (i.e. electronic or paper copy) or its length (i.e. 2 pages or 100). Many management companies have a charge set out in their management agreements that sets out the fee that they will charge the condominium for record requests. That same amount is often used as the fee for the owner.

Question: “One of the directors sold his unit. He didn’t resign. Can he be a director if he doesn’t own a unit?”

Answer: Yes, if the by-laws allow it. Some condominium by-laws require directors to also be owners of the units, but some do not. You have to read your by-laws.

That’s all for now. I’ll answer some more questions next month.

Improper Use of the Indemnification Clause

Many declarations contain a clause that requires the owners to indemnify the corporation for a loss, cost, damage or injury to the common elements or units if it was caused by the owner, his family, tenants, guests etc. Many condominiums attempt to apply these clauses to other types of expenses incurred by the condominium, such as legal costs.

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Considering Amalgamation?

Amalgamation is simply the process of combining of two or more existing condominiums to create a new condominium.Sometimes it is two condominiums, other times it is ten or more.

Amalgamation can be used in almost any circumstance (assuming the legal requirements are satisfied), but it is often used for older “phased” condominiums. The current version of the Condominium Act, 1998 (the “Act”) permits a condominium to be created over a period of time with 1 or more phases being completed after the initial registration. Prior to the Act there was no way to phase condominiums. Instead, “phased” communities were actually constructed as separate condominiums with shared facilities. For an outsider the community seems like one condominium, not several. Continue reading

Unreasonable Owners + Reasonable Board = Costs for Condo

A recent decision of the Superior Court of Justice illustrates how the conduct of the parties can sway a judge when it comes to the issue of costs. The case is York Condominium Corporation No. 922 v. Frank Lu et al (2016). The facts are straightforward. The owner refused to permit the condominium’s contractors to enter the unit to investigate it after a flood in the unit, which was caused by the owner’s tenants. The condominium made repeated attempts to gain access to the unit and offered to meet with the owner to discuss the issue, but the owner refused. The condominium engaged a lawyer, who wrote several letters, but the owner still refused to grant the condominium access to the unit.

The condominium started a court application under sections 92, 117, and 134 of the Condominium Act, 1998. The condominium asked the court for an order requiring the owner to allow it to access the unit to investigate the damage, and if necessary, repair the damage to the common elements.

The condominium was successful in its application and sought $15,416.00 in costs from the owner. Continue reading