Condo Law Blog - Fine & Deo

Municipal By-Laws and Condominiums – What a Condominium Board Needs to Know

Fri Dec 30 10:09:12 -0500 2011

Municipal by-laws set out rules to help form the basis for orderly living in a community. Municipal by-laws address a number of things including: what use can be made of a property (for example, whether you can run a business there or whether it can be used only for residential purposes); the number and kinds of pets a person can have, and; property standards (for example, maintenance and repair issues, storage of things on the property, and guarding against unsafe conditions).

The Condominium Act, 1998, and a condominium corporation’s declaration, by-laws and rules, also set out things that help form the basis for orderly living in a community. Like municipal by-laws they also address, among other things, what use can be made of the property, the number and kinds of pets a person can have, and property standards. In addition, however, a condominium corporation’s declaration, by-laws and rules act as an individual code which governs, regulates, and helps create and define the character of individual condominium communities.

Even though something might be permitted under a municipal by-law, a condominium declaration, by-law or rule can still prohibit the same thing. For example, City of Toronto By-Law 349 (which is the City of Toronto by-law that deals with animals) permits people to keep up to a maximum of three dogs, however, if a condominium declaration in Toronto states that no pets are permitted, then a person living in the condominium is not allowed to keep any dogs on the property. Another example is that a municipal by-law might permit signs or advertisements, but if the condominium declaration or rule prohibits signs and advertisements, then a person in the condominium is not allowed to display any.

Municipal by-laws and condominium documents may address the same problem and provide alternate means of enforcement. For example, municipal by-laws may address what noise a person can make and when. Depending on the type of noise or disturbance it could be the police or someone else who can be called to enforce the by-law. Similarly, condominium declarations and rules almost always stipulate that a person cannot make noise that disturbs the enjoyment by other people of the units and common elements. In such a case the Condominium Act, 1998, provides that mediation/arbitration or court proceedings can be commenced to address a contravention.

Condominium declarations, by-laws and rules almost always stipulate that a person cannot do something on the condominium property that contravenes a municipal by-law. If there is a contravention of a municipal by-law on condominium property, the issue can be dealt with as a breach of the Condominium Act, 1998, declaration, by-law or rule.

Condominium disputes are rarely confined to a single contravention of a municipal by-law, and are rarely settled simply by enforcing the municipal by-law. Condominium disputes most often need to be addressed under the enforcement procedures in the Condominium Act, 1998. These procedures are specifically designed to deal with condominium disputes, and take into account the myriad of interests in a condominium corporation such as costs, personal relations, and consistency of enforcement. It is important to remember in this context that the party who commences enforcement proceedings under the Condominium Act, 1998 is able to help craft a solution to the problem that is appropriate to the condominium. When in doubt consult your condominium lawyer!

How can a Board of Directors amend a declaration?

Fri Nov 04 16:26:34 -0400 2011

A condominium declaration is created exclusively to each condo at the time of registration. Declarations can become outdated and not fit the present modern condo trends. In most cases the only option available to the board of directors is to amend the declaration. When amending a declaration, the board may decide to include aspects of condo culture that were not the norm during the time of the declarations execution or some amendments will concern excluding things that no longer fit the present condo standards. Whatever the goal may be, amending a condominium declaration is governed by section 107 of the Condominium Act (the “Act”). Below is a list of steps simplifying the procedure:

Step 1: Once the board has reviewed the proposed amendment, a registration version of the amendment will be prepared and sent to the Land Registry Office for pre-approval. This is not a legally required step, but highly recommended so there are no surprises when the amendment is presented for registration.

Step 2: After acquiring pre-approval by the Land Registry Office, the proposed amendments must be approved by the board by resolution.

Step 3: Prior to the owners meeting to consider the proposed amendments, (no vote is taken at the meeting) a notice of the meeting must be sent out in accordance with the usual owners meeting procedures and this package must contain:

Details of the meeting (meeting agenda)
A copy of the proposed amendment
Consent forms (for owners to approve the amendments in writing)
Clear instructions to the owners to bring the executed form during the meeting if they approve the proposed amendments must be detailed in this package.

Step 4: The proposed amendments must be approved in writing by the owners of at least 80% or 90% (depending on the changes made) of all units including residential, parking, locker, communication, recreational, superintendent and guest suites in the corporation. Owners are those who are registered owners of the unit on record with the Land Registry Office at the time the board approves the proposed amendments.

Step 5: At the time the board approves the proposed amendments, notice must be sent in accordance with section 47 of the Act, to all mortgagees on record at that time and 30 days must pass as per section 107 (5) of the Act, before the amendments can be registered. A method to keep track of the passage of the 30 day period is to send out the notice to mortgagees (if any) at the same time the corporation sends out the notice of meeting.

Step 6: Once the corporation obtains the required consent from the owners (through collection of the consent forms) and the requirements detailed in Step 5 have been completed, the corporation may proceed with registering the proposed amendments.

Step 7: A “Confirmation Form” must be executed prior to registration to verify that the steps noted above have been complied with. Upon registration, a prescribed certificate (Form 1, 0. Reg. 49) is to be signed by the appropriate members of the board and must accompany the proposed amendments.

Can a condominium restrict rentals in Ontario?

Thu Sep 29 16:04:41 -0400 2011

Restricting rentals of condo units in a building can affect individuals purchasing units in the condominium market and more specifically, the investor-owned units. However, those who plan on owning and residing in the unit may invite such restrictions because of the fear that rented units would generally have a negative effect on the community. Our firm received an inquiry regarding whether Ontario Condominiums are able to impose such restrictions on condo rentals.

Q: I have been told by a couple of owners of rules in their Florida condos that require an owner to occupy a purchased unit for a period of 3 years before being eligible to put the unit into rental. Is such a rule allowable in Ontario? I further understand from these owners that there is a stated percentage of units allowed to be rental properties and no more. Is such a rule allowable in Ontario?

A: Unfortunately the answer is no to both questions for Ontario. Our law firm has argued the leading case in the restriction of rentals in Ontario which allows for the passage of a rule by the board, which requires all leases to be a minimum of 12 months. Beyond that, the rental of units cannot be restricted except, of course, that tenant residents must comply with the same provisions as owner residents, that the landlord is responsible for any tenant transgressions, and that a copy of the lease must be provided to the corporation (see section 83 of the Condominium Act). It is the same legal philosophy that has not allowed adult only buildings in Toronto and the rest of the Ontario for that matter. I do not agree with these restrictions on condominium communities, however there is a provincial election coming up! A condominium should certainly be allowed to forbid rentals. Why not? It is their property to govern and the restriction does not hurt anyone if there is ample notice of it (which is simple to do).

Human Rights Tribunal and Pool Restrictions

Fri May 27 07:32:32 -0400 2011

A recent interesting case at the Ontario Human Rights Tribunal dealt with restrictions against children using a condominium pool.

The two condominium corporations' rules had a prohibition against children under the age of 2 years using the pool, and rules restricting the times during which children under the age of 16 could use the pool. The Tribunal determined on the facts of that case, that these rules were discriminatory and resulted in the complainant's rights, a mother of a ten-month old daughter, being violated on the basis of family status. In finding that the condominium corporations had not fulfilled their duty to accommodate to the point of undue hardship in relation to the prohibition of children under 2 years of age, the Tribunal stated:

"Using the language of the Code, I find that the needs of the group (i.e., families with children in diapers) can be accommodated without undue hardship on the respondents. The respondents have not met their burden to establish that a total ban on children in diapers is reasonable and bona fide in the circumstances."

With respect to the limited hours during which children under 16 years of age were restricted, the Tribunal found that the rules concerning children's hours were not reasonable and bona fide, as follows:

"There was no direct evidence from the respondents that to lift the restrictions which prevent children under 16 from using the facilities outside of the specified “children’s hours” would result in undue hardship. ...

As it stands now, the outdoor pool can only be used by children between the hours of 12-4 on weekdays. Children’s hours for the indoor pool are 1-5 on weekdays. A parent who worked during these hours would not be able to swim with their child because of this restriction. Similarly, a child in school would not be able to use the pool for most or all of these hours. Indeed, these hours seemed designed to minimize access to the pools by children."

The Tribunal also found that the complainant was subject to a poisoned environment at the condominium due to backlash from the other owners, and the Tribunal awarded her $10,000.00 as compensation for injury to her dignity, feelings and self-respect.

Condos in the News

Thu Apr 07 11:39:04 -0400 2011

Early this morning, a hot water supply pipe burst in a 30-storey Mississauga-area condominium tower. The building was evacuated, and at least one resident suffered burns from the scalding hot water. Our thoughts go out to the residents, and we wish them a speedy recovery and return to their homes.

Click here to read the related Toronto Star article.

Requests for Records under the Condominium Act: A Clear Warning to Unit Owners

Fri Apr 01 13:40:49 -0400 2011

A common challenge facing condominium corporations is the presence of "condo commandos", unit owners who engage in a course of conduct that interferes with the management of the condominium corporation.

A recent court case dealt with a unit owner who had performed some repairs to a water supply pipe, and was seeking reimbursement from the condominium corporation. When his request for reimbursement was denied, the unit owner bombarded the management office with countless requests for records and other related information. While the vast majority of his requests for records were satisfied, the unit owner refused to accept that he was not entitled to some of the records, or that others simply did not exist.

The unit owner then commenced two Small Claims Court actions, seeking reimbursement for his cost of repairing the pipe, and production of various records, such as detailed plumbing plans, and legal invoices. The Court dismissed both actions, and also ordered that the unit owner pay the condominium corporation’s legal costs on a punitive scale. In so doing, the Court stated that the Condominium Act did not "condone acts which amount to interference with the board's legal duty to [its] owners", as the innocent unit owners would ultimately be responsible for the cost of defending nuisance lawsuits.

Click here for a copy of the complete decision, Mishukov v. York Condominium Corporation No. 201, Endorsement of Feldman, J. (March 17, 2011) (Ontario Small Claims Court).

Swimming Pool Safety

Tue Mar 15 11:38:25 -0400 2011

It's almost the time of year when our condominium clients are preparing to get their outdoor swimming pools ready for the start of summer. Click here to read our CondoByte - "Swimming Pool Safety".

Springtime in Toronto, Pets and Enforcing Rules

Fri Feb 25 11:51:11 -0500 2011

As I walk my dog around the grounds of my condominium building, the melting snow reveals a springtime tradition; mounds of dog waste, thawing on sidewalks and lawns. As I carefully guide my dog around these seasonal hazards, I am reminded of the minefield of pet rules that are part of so many condominium communities.

The most common version of a condominium corporation’s pet rule grants the board of directors the discretion, or perhaps the “absolute discretion”, to deem a pet to be a nuisance. Nuisance rules are meant to address the behavioural problems of both pets and pet owners alike. Incessant barking, aggression, and fouling the common elements are all examples of potential nuisance.

Once a pet has been deemed to be a nuisance, the board may require that the pet be permanently removed from the owner's unit. Does this mean that the board can demand the removal any pet whenever it wants? No, it doesn’t, because the discretion that is afforded to the board is not a license to act capriciously. How can a board ensure that the exercise of its discretion is within these limits?

In a previous blog, I discussed how a board of directors could protect its decisions from interference from the courts, and in particular, how a good decision is:

investigated, researched, or otherwise informed;

selected from a range of reasonable alternatives;

formalized by a vote of the board;

achieving a valid purpose or objective; and,

made in the best interest of the condominium corporation.

Applying these characteristics to a pet rule, a board would be wise to:

develop and apply a consistent policy that sets out the criteria for when a pet will be deemed to be a nuisance;

wherever possible, have an independent third party verify complaints; and,

open a dialogue with the pet’s owner, informing the owner of the nature of the complaints (but not the identity of complainants), and warn the owner that the status quo is not acceptable.

When the matter comes down to a vote of the board, the preamble to the proposed resolution should describe the precise nature of the problem, and the previous unsuccessful attempts to try and solve the problem.

Please share your thoughts on enforcing pet rules in the comments section below.

Is your condominium's address for service up to date?

Thu Feb 03 12:06:03 -0500 2011

Your condominium corporation has an address for service, usually specified in the declaration, which is registered on title to the units.

It is important for that address to be up to date, however often is is not, and it is either the declarant's address or the condominium corporation's first property manager's address. Some condominiums in Toronto,York and Peel have not even updated their original address for service from the 1970s or 1980s.

The address for service can and should be updated by a board of director's resolution. The applicable form must then be registered on title to all units in the condominium. This is not an expensive procedure.

When will a condominum board's decisions be reviewed by the courts?

Tue Dec 21 13:31:02 -0500 2010

Discretionary Tools: How your Condominium Can Make Expert Decisions

A board of directors in a condominium corporation is routinely required to make difficult decisions. While it is generally accepted that boards have discretion when making decisions, those who disagree with those decisions have increasingly turned to the courts in an attempt to fetter a board’s discretion.

While the threshold for usurping a board's discretion is a high one, there are steps that boards can take to ensure that their decisions will be upheld, if challenged. In the BCE decision in 2008, the Supreme Court of Canada unanimously re-affirmed a principle of corporate law called the "business judgment rule"

The "business judgment rule" means that a court should not interfere with a decision of a board of directors merely because the court itself would not have made the same business choice in the circumstances, so long as the board acts in good faith in performing the function which they were elected to perform. Thus, rather than making the best possible decision, a board of directors will be protected so long as they make a decision which falls within a reasonable range of alternatives.

While a board may have considerable discretion as to the content of a decision, the best way for a board to protect itself is to employ a strong decision-making process. In this regard, decisions should have the following qualities, which will allow them to benefit from the protections of the business judgment rule:

1) An Informed Decision - where appropriate, a board should obtain professional or expert advice in the form or a written report or opinion. In other cases, a board may make an informed decision by considering the input of a committee that is created to study and make recommendations regarding a particular decision.

2) A Range of Reasonable Alternatives - the board should consider and discuss a variety of options and the relative costs and benefits associated with each option, before making a decision. The board may want to record the fact that such a discussion was held in the minutes of the meeting.

3) A Formal Vote - all decisions must be made by a vote of the board during a duly called meeting of directors where a quorum is present. If the board meets informally and decides on a course of action, that decision must be regularized at the next board meeting.

4) A Valid Purpose - a vote of the board should be recorded in a written resolution, which should include a preamble that sets out a valid purpose. The goal that is to be achieved, or problem that is to be rectified, should be evident from a plain reading of the resolution.

5) The Best Interests of the Condominium Corporation - the preamble to the resolution should explicitly state that the p> A decision which is (1) informed, (2) considers a range of reasonable alternatives, (3) is formally recorded, (4) serves a valid purpose, and (5) is, in opinion of the board, in the best interests of the condominium corporation, will protect your board from problems before they happen.

Hoarding in a Condominium

Tue Nov 23 14:33:17 -0500 2010

A man’s home is his castle, except when he hoards in a condo.

Hoarding can be defined as the acquisition of and the failure to discard a large number of possessions that appear to be useless or of limited value. These items can include such things as flyers, newspapers, books and empty plastic containers. Compulsive hoarding can quickly become a dangerous situation in a condominium. Excessive amounts of paper, plastic, and liquids often become a fire hazard. Hoarder’s units also have a much higher risk of rodent and insect infestations.

In the City of Toronto, the property standards by-law currently in place requires that all residents keep their property clean and clear of debris both inside and out. This by-law also requires that properties be kept free of conditions which may encourage infestation of pests. Further, Section 117 of the Condominium Act, 1998 (the “Act”) provides that no person shall permit a condition to exist or carry on an activity in a unit or in the common elements if the condition or the activity is likely to damage the property or cause injury to an individual. It is quite apparent that compulsive hoarding is a contravention of the property standards by-law and of Section 117 of the Act.

Corporations must act as expeditiously as possible when compulsive hoarding is discovered. The first step that the corporation should take is to issue a letter to the unit owner requiring that the unit be cleaned immediately. The letter to the owner should also provide a date and time that the unit will be inspected by the corporation to ensure that the unit owner has complied. On that date, two representatives of the condominium corporation should inspect the unit to determine if the unit owner has complied with the corporation’s request. If the unit is not cleaned to the corporation’s satisfaction, or if the corporation is denied access to the unit, the Fire Department should be contacted and advised of the potential fire hazard in the unit. Often the matter will then be dealt with by the Fire Department, and the Police Department if deemed necessary.

If the compulsive hoarding continues in the unit after the Fire Department is contacted, the next step is for the condominium corporation to contact its solicitors to begin legal proceedings. Depending on the urgency of the situation, the first step taken by the lawyer may be to issue a demand letter to the unit owner requiring that they immediately take measures to permanently remove any fire hazards from their unit. If the unit owner fails to rectify the matter after this demand letter, or if there is a significant and imminent risk of damage to persons or property, the corporation may seek an order for compliance under Section 134 of the Act.

Toronto condominium corporation was vicariously liable for superintendent's actions

Fri Nov 12 13:28:19 -0500 2010

Toronto condominium lawyers are taking note! A recent Toronto condominium case drives home the principle of vicarious liability of an employer for its employee's actions in the condominium context.

http://www.canlii.org/en/on/onsc/doc/2010/2010onsc3433/2010onsc3433.html

In this case, a superintendent forcibly removed a real estate agent from the lobby of a Toronto condominium, including dragging her over the threshold of the entrance, pinning her down and putting his hands around her neck. The real estate agent sued the condominium corporation, the superintendent and the property management company for damages for physical injuries, pecuniary losses, and aggravated and punitive damages. In finding that the superintendent did not have the grounds on which to physically evict her from the lobby, the judge determined that the condominium corporation and the superintendent were jointly and severally liable and awarded general damages of $30,000, aggravated damages in the amount of $8,500, pecuniary damages in the amount of $10,000 in favour of the plaintiff.

Rear Deck Case Affirms Condominium Corporations’ Rights

Fri Oct 29 09:04:50 -0400 2010

In the recent case of Durham C.C. No. 90 v. Wallace, the unit owners in question had sought and obtained approval from the condominium corporation's board of directors to build a deck at the rear of their townhouse condominium unit.

The problem was that the deck, as built, exceeded the dimensions that had been previously approved. The condominium corporation insisted on compliance with the approved dimensions, and, with the assistance of Toronto condominium lawyers, brought a court application to require the unit owners to alter the deck.

The unit owners responded with a counter-application, claiming that they were being treated unfairly, as other owners had been permitted to keep decks which were even larger than theirs. Those larger decks had been grandfathered by the board, as they were constructed prior to the condominium corporation adopting a strict policy regarding the permitted size and dimension of decks.

The court held in favour of the condominium corporation, and ordered the unit owners to bring their deck in to conformity with the approved dimensions. The court also ordered that if the unit owners failed to conform, that the condominium corporation could, on 24-hours written notice, undertake the work and add the cost to the common expenses for the unit.

The court rejected the unit owners'argument that they had been treated unfairly, and upheld the principle that the court should allow the elected board of directors to determine what is best for the condominium corporation as a whole.

If your condominium corporation has a dispute regarding a unit owner's changes to the common elements that cannot be resolved to the satisfaction of the corporation, the condominium corporation’s solicitor should be contacted without delay to discuss the available options.

Board Meeting Good Practices - Reviewing Bank Statements

Fri Oct 08 10:02:16 -0400 2010

Boards of directors should be reviewing monthly bank statements issued by the condominium corporation's bank or trust company, for both the operating and reserve fund accounts of the condominium corporation.

This step should be part of the routine of the montly board meetings, to ensure that your board is being prudent in accordance with its obligations under the Condominium Act, 1998, to manage the affairs of the corporation, and to perform the corporation's duty to control, manage and administer the assets of the corporation.

Dangerous Neighbours

Fri Sep 17 14:24:08 -0400 2010

What can a condominium corporation do when a resident is creating a dangerous situation?

As shown in the recent decision of MTCC 747 v. Korolekh, a condominium corporation can apply to the court for relief, and under extreme circumstances, the court will grant extreme relief.

Ms. Korolekh, who terrorized her neighbours in a variety of ways, including violence and intimidation by her lunging Rottweiler, was ordered to remove the dog, sell her unit, and move out. After Ms. Korolekh failed to abide by the court’s order, the condominium corporation returned to court this morning, September 17, 2010, resulting in an agreement between the parties that Ms. Korolekh would in fact comply.

The case, which is available online, and which was the subject of the front-page headlining article in the Saturday Toronto Star for September 11, 2010, is an important reminder of the unique relationship that exists between condominium residents, and the far-reaching powers of the courts to protect innocent unit owners from those who run afoul of the law.

For those condominium boards that hope to rely on this case, remember that the remedy will always depend on the facts. Ms. Korolekh was ordered to move out and sell her unit because the court determined that she was completely unmanageable – but in other less extreme cases, a court might not be inclined to grant such a remedy. In this regard, our firm has been successful in obtaining a variety of beneficial results in dealing with unmanageable unit owners and tenants alike.