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
There have been several cases in the last year or two that have been stayed (halted) because one of the parties ignored an obligation to arbitrate a dispute. Another decision was released this week. Given the number of cases as of late, it seems that a review of the basic principles might be useful. The most recent case includes a great review so we will summarize it here. Continue reading
Just as I did last year, I’ve put together a list of my favourite condo lessons for 2017. Every condo director, owner, manager, and other person living in or working for condominiums should know these lessons:
10. An owner cannot bring apply for a minor variance from a zoning by-law for common element parking spaces. The board of directors is obligated to manage the common elements, which includes applying for any minor variances that may be required for the common elements. A different result may have occurred if the owner had the exclusive use of all of the common elements the minor variance would apply to, but in this case the owner only had exclusive use of 6 of the 82 parking spaces. Read our post on the case here: https://ontcondolaw.com/2017/10/03/who-can-apply-for-a-minor-variance-for-the-common-elements-condo-or-owner/
9. Only lawyers should register liens. Most lawyers jumped for joy when a decision about a lien was released in May of this year. During the trial a report from the Law Society was produced to show that, in the eyes of the Law Society, a paralegal is not authorized to register liens; only lawyers should register liens. The interesting part is that in most firms the law clerks, not lawyers, register liens. And don’t get me started on lawyers who give their clerks access to their registration keys…yikes. Here is our previous post on the topic: https://ontcondolaw.com/2017/05/29/is-lien-work-really-for-lawyers-only/
8. Condos can charge interest at almost criminal rates. A case this summer confirmed that a condo can charge interest at 30% above the prime rate if a by-law authorizes it. For more information, read the MTCC 1067 v. 1388020 Ontario Corp. case available here: https://www.canlii.org/en/on/onsc/doc/2017/2017onsc4793/2017onsc4793.pdf
7. Green energy initiatives are becoming increasingly popular as hydro costs soar and the government is making it easier for condos to implement some of them. For instance, submetering of the units for electricity consumption does not require the approval of the owners; the board can implement it by resolution of the board alone. Condos cannot prohibit clotheslines, but may have restrictions or conditions for their use. For more information, see our previous post on green energy initiatives: https://ontcondolaw.com/2017/05/10/green-initiatives-in-condos/
6. Similarly, electric vehicles and charging stations are likely to be a hot topic in future years as demand for electric vehicles increases. For more information on some of the legal issues associated with electric vehicles and charging stations see our previous post: https://ontcondolaw.com/2017/04/27/electric-vehicles-in-condos/
5. Degrading and harassing behaviour may be prohibited by section 117 as it may be likely to cause psychological harm. Some owners abuse managers and directors with vulgar language, yelling, and threats. The court has indicated that extreme cases would violate section 117, which prohibits conduct that is likely to cause injury to persons or damage to the property. It would also constitute workplace harassment, which condominiums have a duty to protect their workers from. See our previous post on: https://ontcondolaw.com/2017/04/23/if-you-cant-say-something-nice/
4. Owners need to be careful about sending defamatory emails to other owners and residents. Where an owner sends defamatory emails about directors or the manager, the condominium may obtain an order directing an internet service provider to disclose info to the condo to enable it to identify the person. Defamation is a communication that tends to lower the esteem of the subject in the minds of ordinary members of the public. For more information or to read the case in its entirety, see our previous post: https://ontcondolaw.com/2017/07/26/defamation-in-condos-an-update/
3. The courts will not amend a declaration because an owner feels it is inconsistent with the Act or unfair. The courts have confirmed that their involvement in such matters is limited by the Act to situations where there is an error or inconsistency in documents or where the documents are oppressive. The court will not interfere with validly passed by-laws either. For more information, read our previous post: https://ontcondolaw.com/2017/08/22/summer-case-law-reading/. For a more recent decision by the courts, see the following case: https://www.canlii.org/en/on/onsc/doc/2017/2017onsc6542/2017onsc6542.html
2. Many more condos may make the switch from self-managed to professional managers in 2018 and beyond because of the next lesson on this list. For more information, see our post for self-managed condos: https://ontcondolaw.com/2017/12/18/self-managed-condominiums/
And the top lesson of 2017 (it was also the top for 2015 and 2016) is…
1. The Protecting Condominium Owners Act, 2015. Unless you have been living under a rock for the past year, you know the Condominium Act, 1998, (and a number of other statutes) were amended this year. Some of the key changes in force now include:
- The creation of the Condominium Management Regulatory Authority of Ontario (CMRAO) to oversee condo managers. [www.cmrao.ca].
- The mandatory licensing of condo managers by February 1st, 2018.
- The creation of the Condominium Authority of Ontario (CAO) to oversee condos. [www.condoauthorityontario.ca].
- The creation of the Condominium Authority Tribunal (CAT) to hear condo disputes. The CAT’s jurisdiction is currently limited to record disputes, but the intention is to extend it to other areas in the future.
- Mandatory training for directors and disclosure obligations for candidates for the board of directors.
- A new process for calling owners’ meetings, including new forms for the preliminary notice, notice, and proxies.
- Allowing teleconferencing for board meetings without a by-law.
- Reducing quorum for owners meetings after two unsuccessful attempts to achieve quorum.
- Reducing the approval level required for certain by-laws, like adding disclosure obligations for candidates.
- More communications with owners in the form of three new certificates: periodic information certificate, information certificate update, and new owner information certificate.
- A new record request process where owners, mortgagees or purchasers want to obtain records of the condominium.
There are new forms associated with many of the changes described above. The forms are available here: https://www.ontario.ca/search/land-registration?openNav=forms&sort=desc&field_forms_act_tid=condominium
The deadline for registering condos was recently extended to February 28, 2018. For more information, visit the CAO’s website.
More changes are coming on January 1st, 2018. You can read about those here: https://ontcondolaw.com/2017/12/12/amendments-coming-january-1-2018/
More changes will come into force on February 1st, 2018 and later in 2018 (and maybe early in 2019). Changes still to come include:
- The regulatory part of the licensing of managers, such as a complaints and discipline process.
- Extending warranty coverage through Tarion to residential conversion condominiums in some instances.
- A process for preparing a budget and notifying owners of changes to it.
- A process for charging costs back to owners (i.e. infractions, damage).
Stay tuned! Next year should be full of lessons as more of the amendments are released and we have an opportunity to interpret them.
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.
Yet another case has been released where the judge hearing the case has been very critical of the parties, especially their failure to consider mediation or act reasonably. In Couture v. Toronto Standard Condominium Corporation No 2187 (2015) a dispute arose about a parking space.
Here are the brief facts: the condominium has 44 units, but only 32 parking spaces. The declaration indicated that parking would be assigned at the “sole discretion of the Corporation.” It also required vehicles to be licensed, insured, and in good repair. The owner was fortunate enough to have been assigned a parking space when she initially purchased her unit. In 2012, the condominium revoked her rights to use the parking space as it claimed that she was not complying with the declaration because the vehicle was not in good repair or licensed. She removed the vehicle and claimed that as long as she paid the rental fee of $50.00 per month she was entitled to keep the space whether there was a vehicle using it or not. Continue reading
The courts have been busy this year! While that is good news for law bloggers, it means far too many condominiums are spending money on lawyers when they could be spending it on solutions. Here are the highlights from cases in Ontario:
10. Declarants may use s.152(6) of the Condominium Act, 1998 to regain control of phased condominiums years after they became entitled to request a meeting of owners to elect a new board. Such conduct may not be oppressive, even when the reason for the request was to end litigation started by the condominium against the declarant: Middlesex 643 v. Prosperity Homes Limited. Continue reading
The Court recently had to determine whether a dispute with respect to a shared facilities agreement must proceed to mediation and arbitration or whether it could be heard in court (see Metropolitan Toronto Condominium Corporation No. 965 v. Metropolitan Toronto Condominium Corporation Nos. 1031 and 1056 (2014) SCJ).
The plaintiff, a condominium, brought an application against two other condominiums claiming they had breached the shared facilities agreement (SFA) they were all parties to. The plaintiff condominium also alleged that the other two condominiums were acting oppressively. The defendants brought a motion asking the court to stay (put a stop to) the action and order arbitration. The defendant condominiums argued that the shared facilities agreement required arbitration of disputes. They also argued that section 132 of the Condominium Act, 1998 required mediation and arbitration of disputes with respect to shared facilities disputes. The plaintiff condominium argued that mediation and arbitration was not required because it was seeking relief under section 135 of the Condominium Act, 1998 (oppression). Continue reading
In Grigoriu v. Ottawa-Carleton Standard Condominium Corporation No. 706  O.J. No. 2218 two owners of a unit applied to the court for an order amending the condominium’ declaration under section 135 of the Condominium Act, 1998. The owners claimed a recent amendment made to the declaration was oppressive or unfairly disregarded their interests.