Recent Changes to Cannabis Laws

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On October 17, 2019, the Cannabis Regulations under the Cannabis Act were updated to establish rules for the legal production and sale of three new classes of cannabis: edible cannabis, cannabis extracts, and cannabis topicals (i.e. lotions). It is expected that these new products will be available to Canadians before the end of the year.

What does this mean for condominiums? Continue reading

Coming January 1, 2020…

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We are still early into the Fall season, but there have already been a few announcements about changes coming January 1, 2020. More changes are expected to be announced, but here’s what we know so far.

Condo Authority of Ontario (CAO) 

The CAO announced that it will again have a 25% reduction in its fee for the 2020-2021 year. The fee will be $0.75/month per voting unit. The annual fee was initially set at $1/month per voting unit, but the costs to operate the CAO have been less than initially projected (in part because the CAT’s jurisdiction has not been expanded as originally anticipated under the previous government).

(Note: the Government of Ontario has proposed making the CAO responsible for 19 of the prescribed forms under the Act and its regulations, including information certificates, preliminary and notice of meeting, proxy, and forms related to record requests. These changes could take effect as early as January 1, 2020. Stay tuned on this one as it hasn’t been confirmed yet!).

Court Changes

The Government of Ontario announced some key changes to the court system in Ontario. The changes are aimed at increasing access to justice, reducing legal costs, and making the process quicker. On January 1, 2020 we will see the following changes:

  1. Increase in the monetary limit for Small Claims Court from $25,000 to $35,000.
  2. Increase in the monetary limit for Simplified Procedure actions in the Superior Court of Justice from $100,000 to $200,000.
  3. Other changes designed to reduce costs and speed up the process.

For those with claims with limitation periods expiring after January 1, 2020, you should discuss the pros and cons of commencing your actions now or waiting.

Condo Ignores Condo Authority Tribunal (CAT) Requests to Join Case

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A recent CAT decision serves as a good reminder to condominiums of the consequences for refusing to participate in the process.

The owner requested various records from the condominium twice. The condominium had its lawyer respond indicating that it had no obligation to respond because the owner had not used the mandatory form. The lawyer provided a copy of the request form with the letter and indicated that they would respond to the request once it was submitted on the proper form. The owner completed the form and sent a copy via fax to the lawyer and manager. The condominium did not respond so the owner filed a case with the Condominium Authority Tribunal (the “CAT”).

The owner provided notice of the CAT case by courier to the condominium at the management office. The CAT clerk even contacted the condominium twice to ensure they received the notice. The condominium still did not join the case. The condominium did not participate at any point and the process continued without it.

There is an interesting discussion of records requested by the owner that related to a civil action commenced by the condominium against the builder and developer. The action was funded by a special assessment and eventually settled with a payment to the condominium of $1.7 million. The owner was concerned because there was apparently a discrepancy between the settlement amount and the amount received by the condominium ($700,000) so the owner sought an accounting of the amount as well as the settlement agreement. After reviewing sections 55 and 23 of the Act, the CAT member found the owner was entitled to see the settlement agreement.

The CAT ordered the condominium to provide all of the records requested by the owner and pay a penalty of $3,000 for its refusal to provide the records without reasonable excuse. The CAT also awarded the owner costs of $150 (the filing fees paid to the CAT by the owner).

While $3,000 is a significant penalty for many condominiums, I wonder if it is enough incentive for some of the larger condominiums with multi-million dollar budgets. Clearly some are still choosing to ignore record requests by owners (and apparently direct contact from the CAT clerk). What will it take to get them to respond? $10,000? Personal liability on the directors? A summons? Fortunately, most condominiums comply with their obligations when records are requested.

The full case is available on CanLii: https://www.canlii.org/en/on/oncat/doc/2019/2019oncat44/2019oncat44.pdf

Get to Know the Team: Evan Holt

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Practice Areas

Evan’s practice is divided between assisting declarants acquire land and develop condominium plans and assisting condominium corporations and unit owners with condominium related issues.   Evan’s work includes:

  • reviewing and drafting agreements of purchase and sale;
  • assisting with various matters relating to condominium plan registration;
  • attending and acting as chairperson at condominium meetings;
  • drafting condominium documents (declaration, by-laws, and rules);
  • coordinating the collection of common expenses;
  • negotiating and drafting shared facilities agreements;
  • arranging settlements among condominium corporations, suppliers, or unit owners; and
  • commencing enforcement proceedings against a condominium corporation or unit owner.

Recently, Evan has devoted time to assisting condominium corporations collect arrears of common expenses that are no longer eligible to form the subject matter of a lien.  Evan has found that creative thinking and a willingness to understand the positions of opposing parties is key to any successful resolution.

Involvement

Evan is a former member of the Communications Committee of the Grand River Chapter of the Canadian Condominium Institute.   Evan has written articles that have been published in the Grand River edition of the Condo News and hopes to have more opportunities to have articles published in the future.

Personal

Evan enjoys spending time with his family, friends, and his dog, Bauer.  He is a sports enthusiast and you can often find him watching or participating in live sporting events.

Contact

Evan would be happy to speak with you to discuss any condominium related issue by e-mail or phone.

Quiet condo for retirement? Maybe not…

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A recent case discusses an interesting (and becoming more common) situation where a building is registered as a condominium, but also operated as a retirement home under the Retirement Homes Act, 2010. An action was commenced by certain unit owners against the condominium and various corporations involved in the operation of the retirement home. The owners claimed that the defendants breached the declaration, by-laws, and Retirement Homes Act, 2010, by acting in a discriminatory manner against some of the owners. The owners sought an order that: 1) required the defendants to ensure that at least 2 directors are independent of the defendants; 2) required the defendants to use an agreement that sets out the services program with mandatory fees in accordance with the by-laws; and 3) damages in the amount of $50,000. Continue reading

Is the CAO responsible for creating the forms? Maybe in the near future…

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There is a new proposal to have the CAO assume responsibility for 19 forms under the Condominium Act, 1998 and its regulations. The idea is that the proposed changes would “support the condominium community in being able to more easily access and use certain forms under the Condominium Act, 1998.” The proposal is for 17 forms to be delegated to the CAO on January 1, 2020 and 2 additional forms on July 1, 2020. Continue reading

The New Three P’s?

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If you live in or work for condominiums you’ve heard of the three p’s: people, pets and parking. These are three of the most common sources of problems in condominiums. (It really boils down to one problem – people – but let’s leave that aside for now.)

Lately, it seems like condominiums are encountering problems related to a new set of p’s: pot, prostitution and petty crime. Here we use “pot” to refer to drug activity generally, “prostitution” to include related crimes like human trafficking, and “petty crime” to refer to other sorts of criminal activity, such as vandalism and bicycle thefts. For some really unfortunate condominiums they experience all three of these at once.  Continue reading

A Warning to Owners Leasing their Units

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A recent case provides a warning to owners leasing their units. Briefly, the facts are as follows. A unit owner leased her unit to a tenant. The tenant “did not live harmoniously with his neighbours” and was in constant conflict with management. He sued the condominium for over $5,000,000. The condominium’s lawyer wrote to the owner to warn them that the costs incurred by the condominium to defend itself against the tenant’s claim would be sought from them. The owner’s son, who was power of attorney, ignored the warning and provided an affidavit in support of the tenant’s claim against the condominium. The tenant’s claim “failed miserably” and the condominium sought to recover about $86,000 in legal fees from the owner.  The owner refused to pay and the condominium registered a lien against the unit.

The court found no reason to question the validity of the lien. The main argument presented by the defendants was that the owner was not properly served by the condominium. The court found that the owner was in India at the time and it was difficult for her own family to contact her. “It would not be realistic to require the corporation to serve her personally and the law does not require it.”

The court reviewed the new provisions of the Condominium Act, 1998 at paragraph 27:

The Condominium Act establishes what must be done to serve a document for the purposes of the Act:

  • Section 46.1(3)(b) requires the corporation to keep a record of each unit owner’s address for service if that address is in Ontario.
  •  Section 46.1(4) states that a document can be served on an owner in several different ways including delivery by prepaid mail addressed to the owner at the address for service that appears in the records of the corporation.

The court was satisfied that the documents were served on the owner when the condominium sent the document via registered and regular mail to the address for service provided by the owner. “There was nothing more that the corporation could do.”

The owner also disputed the validity of the process because the condominium did not bring an action or have a hearing before registering the lien. The court reviewed section 85(1) of the Act and confirmed the process does not require an action to be commenced prior to the registration of a lien against a unit. The condominium must register the lien within three months of the default and must provide notice of the lien at least ten days before registering it. The condominium satisfied the requirements of the Act.

The owner tried to argue that it was not fair for them to be responsible for their tenant. In response, the court said:

[36]           The simple answer to the questions raised by the Sandhu family is that section 134(5) of the Condominium Act makes the unit owner responsible for the financial consequences of her tenant’s actions. If a corporation is awarded costs in an order which is made against an owner or an occupier of a unit, the costs, including the legal fees of the corporation, are added to the common expenses of the unit. That is simply the law of Ontario.

[37]           There are very good reasons for that law. One must consider the nature of condominiums and the rules that are necessary to regulate them. A condominium draws many strangers to live together in a single building. For many unit owners, the purchase of their condominium unit will be the largest financial investment of their lives. It is essential that the building is managed in a way that preserves the value of the property and maintains a sense of fairness for everyone.

[38]           The sense of fairness is created by imposing strict responsibilities both on unit owners and managing corporations. Unit owners are responsible for paying their share of the common expenses and for the conduct of any one who occupies their unit. The corporation is responsible for collecting the common expenses and notifying the unit owner of any troubling behaviour by a tenant. The purpose of the legislation is to ensure that the actions of a single unit owner do not give rise to additional expenses for all the other unit owners.

The court, while sympathetic to the owner’s situation, granted judgment in favour of the condominium and granted it possession of the unit so it can sell the unit to recover the amounts owing under the lien.

 

 

Summer Reading: Condo Authority Tribunal (CAT) Edition

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On April 11, 2019, I wrote about some of the Condo Authority Tribunal (CAT) decisions so far. Some of the highlights include the dismissal of claims that were vexatious, the adoption of the “open book” principle enumerated in previous case law, and confirmation that owners may access the list of owners. You can read the post here. The CAT has been busy since my previous post, releasing another 16 decisions in the last four months! Here are some of the highlights for these recent cases: Continue reading