Monies owed pursuant to a Shared Facilities Agreement?

The Superior Court has released an interesting decision regarding the appropriate limitation period for amounts owing pursuant to shared facilities agreements (also referred to as “cost sharing agreements”). In Toronto Standard Condominium Corporation No. 1487 v. Market Lofts Inc. the condominium commenced an action against a party to a shared services agreement that was registered against title to the condominium. The condominium sought payment for amounts owing between 2006 and 2014, plus interest.

The defendant argued that the claim was statute-barred pursuant to the basic two-year limitation period set out in the Limitations Act, 2002. The condominium claimed that it was a demand obligation and since a demand was not made until 2012, its claim was not statute-barred. The condominium also claimed that the basic two-year limitation period did not apply, and suggested that the ten-year limitation period set out in the Real Property Limitations Act applied.

After a very thorough review of both statutes and the relevant case law, Perell J. found in favour of the condominium: the Real Property Limitations Act applied, not the Limitations Act, 2002. This decision means that an action to collect an amount owing pursuant to a shared facilities agreement must be commenced within ten years, not two years as is the case with most actions in Ontario.

I am left wondering if the reasoning in this case could be applied to other condominium matters, such as common expenses due from owners where, for whatever reason, the arrears are missed for several years. Does it matter if a lien is registered against the unit or not? How long does the condominium have to enforce a lien, two years or ten years? What about amounts owing from the declarant?

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