10 Condo Law Highlights of 2020

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2020 has been an eventful year, to say the least. With everything else going on in the world, who has time to stay on top of changes in condominium law? We do! And so to help you out, we’ve prepared a list of 10 changes and decisions in condominium law in 2020 that you won’t want to miss.

  1. The Condominium Authority Tribunal (the “Tribunal”) expanded its authority

Starting on October 1, 2020, the Tribunal’s jurisdiction expanded to include hearing disputes based on provisions in a condominium’s declaration, by-laws, or rules regarding: (a) pets, (b) vehicles, (c) parking/storage, and (d) indemnification/compensation related to the disputes in (a)-(c). This means that disputes in these categories can now be heard using the Tribunal’s streamlined dispute resolution process instead of going to court.

  1. The new Condo Guide for pre-construction and newly-built residential condo purchasers

The Condominium Authority of Ontario released a new Condominium Guide which, starting January 1, 2021, must be delivered to all potential purchasers of pre-construction and newly-built residential condominium units. The Guide will give these purchasers more information on condominium construction and condominium living. For more information on the Condominium Guide, see our previous post here: https://rcllp.ca/condo/?p=499

  1. “Adequate” condo records need not be perfect

Condominiums are required to keep adequate records. The Tribunal confirmed that “adequate” means the records must allow the condominium to fulfill its duties under the Condominium Act, 1998 (the “Act”). To do so, “adequate” records must be accurate but need not be perfect. The level of accuracy required for a record to be “adequate” may vary depending on the record in question. For example, minutes of board meetings are held to a high standard because they look back on facts which should be certain and known, and they serve the important purpose of making the board’s affairs open to the owners. Read the full case here: https://www.canlii.org/en/on/oncat/doc/2020/2020oncat33/2020oncat33.html?resultIndex=1

  1. A condominium cannot impose conditions before releasing records to owners

The Tribunal determined that a condominium cannot impose conditions before providing requested records to an owner. If the records are properly requested by the owner, the condominium must either provide them or refuse to provide them (with a reasonable excuse for the refusal). By imposing conditions, the condominium effectively refused to provide the records. Read the full case here: https://www.canlii.org/en/on/oncat/doc/2020/2020oncat2/2020oncat2.html?resultIndex=1

  1. Comply with Tribunal orders or face cost consequences in court

The Tribunal ordered the condominium to provide records to the owner within 30 days. The condominium did not comply, so the owner took the matter to court. The condominium provided the records to the owner before the court hearing date, yet because the condo had still breached the Tribunal’s order, the court ordered the condominium to pay the owner’s legal fees and disbursements totalling $14,716.91. This serves as a reminder that timelines in Tribunal orders must be complied with, and that Tribunal orders may be enforced in court. Read the full case here: https://www.canlii.org/en/on/onsc/doc/2020/2020onsc189/2020onsc189.html?resultIndex=1

  1. Condominium directors not held personally liable for board decisions

A declarant claimed that the condominium’s directors acted oppressively toward the declarant. The court determined that the claims could not succeed against the directors personally. The directors’ decisions in question were decisions relating to day-to-day activities of the condominium without personal gain, and therefore even if the directors made the wrong decisions, this did not justify a personal order against them. Read the full case here: https://www.canlii.org/en/on/onsc/doc/2020/2020onsc6445/2020onsc6445.html?resultIndex=1

  1. Significant cost consequences of acting unreasonably  

After succeeding in a case against his condominium, an owner sought a court order for the condominium to cover the costs he had incurred. The court ordered the condominium to pay $83,340 in costs to the owner. The court granted this unusually high costs award because the owner had acted reasonably throughout the matter whereas the condominium was unreasonable and aggressive. Let this serve as a reminder and a warning that unreasonable, aggressive behaviour from a condominium may have significant cost implications. [Note: the decision was unsuccessfully appealed by the condominium, resulting in another $30,000 costs order payable to the owner]. Read the full case here: https://www.canlii.org/en/on/onsc/doc/2020/2020onsc1190/2020onsc1190.html?resultIndex=1

  1. The Act will be interpreted to protect owners

A third party claimed that a condominium’s action against it was a nullity because the condominium did not properly notify the owners of the action under section 23 of the Act. The court held that it would be inconsistent with the Act, which is designed to protect owners, to render an action a nullity where doing so would actually be detrimental to the owners. The condo commenced this action for the benefit of the owners and therefore it was allowed to proceed despite not providing proper notice to the owners. Read the full case here: https://www.canlii.org/en/on/onca/doc/2020/2020onca63/2020onca63.html?searchUrlHash=AAAAAAAAAAEADVNPIDE5OTgsIGMgMTkAAAABAA4vNjY1LWN1cnJlbnQtMQE&resultIndex=3

  1. Tenant’s excessive noise was a breach of the condominium rules

A tenant in a high-rise condominium repeatedly made excessive noise. The neighbouring tenant repeatedly made noise complaints to property management. The condominium took steps to get the noisy tenant to stop, and when those failed, the condominium filed a court application to enforce compliance with the Act and the condominium’s rules. The condominium succeeded. Not only was the tenant ordered to comply with the Act and the rules, she also had to pay condominium’s costs of $23,250. Read the case and costs decision here: https://www.canlii.org/en/on/onsc/doc/2020/2020onsc196/2020onsc196.html and https://www.canlii.org/en/on/onsc/doc/2020/2020onsc3853/2020onsc3853.html?searchUrlHash=AAAAAAAAAAEADVNPIDE5OTgsIGMgMTkAAAABAA4vNjY1LWN1cnJlbnQtMQE&resultIndex=5

  1. Another noise complaint

In the case above, the condominium and the neighbouring tenant worked together to deal with the loud tenant. In contrast, this is a case initiated by an owner against her condominium for failing to take sufficient action to deal with her noisy neighbour. The court determined that the condo could have done more but still acted reasonably, so the claim was dismissed. Noise can be a serious issue in condos, and condos should balance the competing interests of the parties when dealing with these disputes. Read the full case here: https://www.canlii.org/en/on/onsc/doc/2020/2020onsc1262/2020onsc1262.html?searchUrlHash=AAAAAAAAAAEADVNPIDE5OTgsIGMgMTkAAAABAA4vNjY1LWN1cnJlbnQtMQE&resultIndex=6

Are emails between directors a record of the condominium? The CAT says…

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Can owners request copies of emails between directors? Can the condominium refuse a record request because the owner’s reason for requesting the records is apparently unrelated to their ownership interests? Must the owner prove their reason is related to their ownership interest, or is the onus on the condominium to prove the reason is unrelated to the owner’s interests? These are only a few of the questions recently answered by the Condominium Authority Tribunal (CAT).

Kai Sin Yeung v. Metropolitan Toronto Condominium Coporation No. 1136 

An owner requested emails related to the renewal of a gas contract referenced in board meeting minutes. The owner wanted a penalty and costs of the hearing. The condominium claimed that the emails do not exist, but even if they existed the owner would not be entitled to them. Continue reading

Lessons from the CAT

legal caseOn April 5, 2019 I attended the ACMO / CCI 1-day Conference in Kitchener. I was asked to speak during the round table discussions and on the legal panel. My topic for the round table discussion was the Condominium Authority Tribunal (CAT). Today I thought that I would share some of the lessons that we have learned so far from the CAT’s first twenty or so decisions. Continue reading

Summer Case Law Reading

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Who doesn’t enjoy a little case law reading by the pool or beach? Oh, that’s just me? Oh well. I hope you enjoy reading these brief summaries anyway.

MTCC No. 1067 v. 1388020 Ontario Corp. 

This is an action by a condo to enforce a lien. The condo brought a motion for summary judgment. There were three issues: interest on the arrears of monthly fees; additional expenses claimed by the condo; and legal costs.

The condo claimed interest at a whopping 30% above the prime rate charged by TD to its best risk commercial accounts per annum, compounded monthly. The defendant argued that the condo was not entitled to such a high rate of interest because it could not provide precise, consistent statements to show it was entitled to the full amount. The judge disagreed. The by-law was a contractual arrangement between the owner and the condo and there was no reason not to enforce it.  Continue reading

My Favourite Condo Lessons of 2016

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As 2017 approaches I find myself reflecting on the most important news, cases, and other events from this past year. Here are my favourite condo lessons for 2016:

10. Property Managers may be liable for errors in status certificates. The responsibility for the status certificate is normally set out in the management agreement so make sure that you are familiar with any limitations of liability and any obligations on the board to disclose information relevant to the status certificate. You can read the most recent case here and the costs award here.

Continue reading

The Condo’s Lien Right – When Does Default Occur?

bank.jpgRecently, the court released an interesting decision on cost awards against owners and the right to lien.The facts are lengthy, but it is important to understand the background.

The condominium brought a compliance proceeding against one of the owners. The condominium was successful. The judge made an endorsement that required the owner to pay $15,000.00 in costs within 30 days of the date of the endorsement. The condominium switched counsel and management companies shortly after the endorsement was made. Several months later the condominium added $44,000 to the unit owner’s ledger. The condominium’s lawyer then sent a letter to the owner demanding payment within 30 days.  The owners did not pay so the condominium’s lawyer sent a notice of lien in November 2011 and registered the lien in December 2011. The condominium served a statement of claim for possession and a default judgment was signed in April 2013. A notice of sale was sent in May that indicated $77,709 was owing. The condominium obtained possession of the unit in November 2013.

In December 2013, the owner stopped paying his mortgage. The lender, CIBC, began making demands for payment. CIBC obtained judgment on October 22, 2014, for $135,411 plus costs. For unexplained reasons, CIBC was not aware of the power of sale proceedings of the condominium and the fact that the condominium was set to sell the unit within a few days. The condominium and CIBC agreed to continue with the sale of the unit and hold the proceeds in trust until a court could determine the priority of the lien and mortgage.  Continue reading

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.

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

Condo Harassment: Is it real?

If I had a dollar for every time I’ve heard “this is harassment” in response to a letter sent by one of my condominium clients to an owner about a rule violation I could have retired at 26. It seems to be an allegation that is thrown out without much consideration about what it actually means. What does it mean? What obligation does the board have to investigate complaint of harassment? What steps should a board take when it receives a complaint? Fortunately, recent decisions provide answers to these questions and more. I’ll briefly discuss two cases today.

The first case is Wexler v. Carleton Condminium Corporation No. 28. An owner commenced an action in Small Claims Court against the condominium seeking about $2,500.00, mostly for alleged harassment by the condominium.  The condominium argued that it was not harassing her, but taking steps to ensure that she complied with the Act, declaration, by-laws and rules.

The judge reviewed the case law on civil harassment and identified four elements:

  1. was there outrageous conduct by the defendant?
  2. did the defendant intend to cause emotional distress to the plaintiff?
  3. did the plaintiff suffer severe emotional distress?; and
  4. was the plaintiff’s emotional distress caused by the defendant.

The court found that the owner did not present any evidence of the elements and dismissed her action with costs. The judge said:

The Corporation’s conduct was not outrageous; the Corporation was enforcing the provisions of the Act, the Declaration, the By-laws and the Rules. It was exercising its statutory duties. The Corporation had no intention of causing emotional distress to [the owner], nor did it act with a reckless disregard which could have caused emotional distress to her.

I understand that the condominium asked for over $35,000.00 in costs from the owner, even though cost recovery in Small Claims Court is normally limited to 15% of the amount claimed. The judge found that a higher amount was necessary to penalize the owner for her unreasonable behaviour and awarded the condominium $20,000.00 in costs. This means that at least $15,000.00 in costs will become common expenses all because this one owner felt harassed by the board satisfying its duty to ensure the owner complied with the Act, declaration, by-laws and rules.

The second case is Welykyi v. Rouge Valley Co-Operative Home Inc.. A group of 10 owners made human rights complaints against a co-operative. The owners claimed that the board did not respond appropriately to discriminatory and vulgar messages posted throughout the co-operative over a 5 month period. The Tribunal characterized the messages as “truly heinous” displaying a “shocking level of ignorance and intolerance.” Many of the owners were previous board members. According to the decision, there was tension between the “old board” and “new board”. The board never identified the person or persons responsible for the messages.

The Tribunal reviewed the case law, including the obligation of a housing provider, such as a condominium’s board, to address complaints of violations of the Human Rights Code. The Tribunal described the factors to be used in assessing whether a complaint has been adequately addressed:

  1. was there in place a harassment policy, complaint mechanism, and training?;
  2. once a complaint was made, was it taken seriously, dealt with promptly and sensitively, and reasonably investigated and acted upon?; and
  3. was a reasonable resolution found and was it communicated to the complainant?

The factors are not definitive, but are to be used as a general guide.

It is clear from reading the decision that the Tribunal was primarily concerned with the board’s failure to acknowledge the complaints and investigate them. The Tribunal found “significant deficiencies” in the board’s response and awarded each owner $3,000.00. The Tribunal also ordered the board to circulate the decision.

While it is a case about a co-operative its principles will likely be applied to condominium boards. In my opinion, the important points to take away from the case are:

  1. condominiums should have anti-harassment policies, rules or complaint procedures in place;
  2. boards should be trained in human rights issues;
  3. boards should acknowledge complaints and keep complainants informed;
  4. boards have an obligation to promptly investigate complaints of harassment, which should include speaking with the complainants and anyone else who may have knowledge of the incidents;
  5. boards have an obligation to take steps to prevent harassment, which may include re-positioning cameras or improving security features; and
  6. boards should condemn harassment, which may be done at meetings or by sending out notices to all owners condemning the behaviour.

Interestingly, the Tribunal seemed to suggest that the installation of fake cameras could have been an option for the co-operative:

Relocating a camera in this way was appropriate action for the Board to take. The installation of fake cameras, whatever the other issues that arise with deploying non-functional cameras, could have been a reasonable approach for the Board to take in light of its poor finances. Non-operational cameras could be a deterrent, provided that the fact that they do not function does not become known.

The Tribunal also criticized the board for failing to investigate because they relied upon bad advice that they had to capture the perpetrator to find a proper resolution:

Catching a harasser is not always possible, as in this case, and a housing provider should not focus on apprehension to the exclusion of other considerations, such as communicating with and supporting the victims.

As such, the board had an obligation to investigate the complaints and support the victims, even if it was unlikely to determine who were the culprits of the messages.

This was a long post, but the cases highlighted so many important point about harassment in condominiums that it was impossible to cut any portion out. Do you have any practical solutions to addressing harassment?