Reserve Funds – The Limits of a 30-year Study

According to the Condominium Act, 1998, all condominium corporations (in Ontario) must make contributions to a reserve fund for purposes of “major repairs and replacements”. To assist in determining the required contributions, condominium corporations must arrange for “reserve fund studies”, which are carried out by prescribed reserve fund analysts. The reserve fund study must plan for all major repairs and replacements over at least a 30-year period.

The problem with this is as follows: What if there are common element features, or assets, that won’t require repair or replacement until after the 30-year study period?

Depending upon the methodology of the reserve fund analyst, those features may not be included in the 30-year study, and accordingly may not be included in the analysis of the required funding contributions for a given study.

As a result:

  1. It is important to understand the methodology used by your reserve fund analyst to arrive at the required funding contributions for your particular study.
  2. Some reserve fund analysts, and some condominium corporations, may prefer a longer study period (say, 40 years or more) for their reserve fund studies.
  3. In any event, condominium corporations may need to include a warning, in paragraph 12 of their status certificates, if there are common element features, or assets, that won’t require repair or replacement until after the period covered by the corporation’s reserve fund study (whether the period is 30 years, 40 years, or more), and which have not otherwise been included as part of the analysis for the required funding contributions. This is because contributions to the reserve fund might need to increase (beyond inflation) when those repairs or replacements do ultimately fall within the study.

ACMO/CCI – Kingston Conference

Save the date and join us at the ACMO/CCI-Kingston Conference on November 28, 2014.The Conference will take place at the Days Inn Hotel & Convention Center, located at 33 Benson Street in Kingston from 8:30 AM to 4:00 PM. Topics will include fire protection and prevention; legal issues; reserve fund studies (RFS) and performance audits; as well as problems with hoarding. Nancy Houle and James Davidson will be speaking on hoarding, and other key legal issues which confront the condominium community.

The cost of the Conference is $75 + HST, which includes a grab bag, lunch and sessions. To register for the Conference, fax this form to Wanda Blakney at 613-531-0857. 

We Have a Winner for 2014!

The Great Eastern Ontario Condo Quiz – 2014 Edition is over, and we are excited to announce our winner!

Congratulations! The winner of the draw is Salim Jafri!

Thank you to everyone who participated in this year’s Quiz. Come back to visit our blog often for updates and news on all areas of Condominium Law, and stay tuned for our next contest!

NO PURCHASE NECESSARY TO ENTER OR WIN. Open only to legal residents of Ontario who are of legal age of majority and at least nineteen (19) years of age at the time of entry. Not open to employees or immediate family members of employees of Nelligan O’Brien Payne LLP or its affiliated entities. Contest closes at 11:59 p.m. ET on October 29. 2014. One (1) prize available to be won consisting of a one (1) hour conversation on a condominium law question of the contest Winner’s choice with a lawyer from the Condominium Law Group at Nelligan O’Brien Payne LLP, and a Nelligan O’Brien Payne merchandise prize package. The conversation outlined in Part (a) of the Prize above will not constitute legal services or create a solicitor-client relationship. Draw will be conducted on or about October 30, 2014, and winner will be announced on October 30, 2014. Odds of winning depend on the total number of eligible entries received for the drawing at issue. Mathematical skill testing question must be answered correctly to win. For full rules, please click here.

Meeting Challenges

The Annual General Meeting (“AGM”) for a condominium corporation is a very important event. In some cases, it is the only time in the year when the owners gather to conduct the affairs of the condominium. The role of the AGM Chair in conducting the meeting, and going through the business of the meeting, cannot be understated! Furthermore, as far as elections and voting is concerned, certain key principles must be kept in mind.

A recent case of the Ontario Superior Court (YCC No. 42 v. Gosal) has provided confirmation or guidance in relation to the role of the AGM Chair, and certain key principles governing elections at AGMs:  

  1. The Chair’s role is concluded when the meeting is complete.  Any subsequent challenge to the meeting process is a matter for the Courts.
  2. Any concern which an owner may have about a proxy (including validity of a proxy) or voting rights at a meeting of owners should be expressed promptly, and normally at the meeting in question.
  3. An election should only be set aside if the voting results can be shown, on a balance of probabilities, to be inaccurate. An allegation or possibility of a problem is not sufficient to set aside an election.
  4. The votes, or proxies, in question which are challenged must be shown to have a material impact on the election results, in order for a challenge to be successful.

Week Four Question: The Great Eastern Ontario Condo Quiz – 2014 Edition

Have a question about a condo owner with a noisy pet? Want to know how to remove a director from your condo board? Thinking about buying a condo? Enter to win a one hour conversation on a condo law question of your choice with one of Nelligan O'Brien Payne’s Condo lawyers!*

*For full contest rules, including a description of the prize, please click here.

It's not too late! Don't miss your chance to take part in The Great Eastern Ontario Condo Quiz – this is the final week! Take part in The Great Eastern Ontario Condo Quiz – 2014 Edition! The winner will be drawn randomly and announced in a blog post on October 30, 2014. For more details on the contest, including how to enter, please click here.

The Official Week Four Question is:

Are the municipal election candidates entitled to come onto your condominium corporation’s property for the purpose of campaigning and speaking to residents? Yes or No?

Instructions for Submitting:

The Question for Week Four is now closed – thanks for playing!

NO PURCHASE NECESSARY TO ENTER OR WIN. Open only to legal residents of Ontario who are of legal age of majority and at least nineteen (19) years of age at the time of entry. Not open to employees or immediate family members of employees of Nelligan O’Brien Payne LLP or its affiliated entities. Contest closes at 11:59 p.m. ET on October 29th. One (1) prize available to be won consisting of a one (1) hour free session with a Condo lawyer on a condo topic of your choice. Draw will be conducted on or about October 29th, 2014, and winner will be announced on October 30th, 2014. Odds of winning depend on the total number of eligible entries received for the drawing at issue. Mathematical skill testing question must be answered correctly to win. For full rules, please click here.

Week Three Question: The Great Eastern Ontario Condo Quiz – 2014 Edition

Have a question about a condo owner with a noisy pet? Want to know how to remove a director from your condo board? Thinking about buying a condo? Enter to win a one hour conversation on a condo law question of your choice with one of Nelligan O'Brien Payne’s Condo lawyers!*

*For full contest rules, including a description of the prize, please click here.

Take part in The Great Eastern Ontario Condo Quiz – 2014 Edition! There will be a four blog posts containing quiz questions in October. You will receive a ballot for each question that you answer correctly and submit an eligible entry for within each weekly contest period. For example, if you answer four questions correctly and submit eligible entries for each, you will receive four ballots. The winner will be drawn randomly and announced in a blog post on October 30, 2014. For more details on the contest, including how to enter, please click here.

The Official Week Three Question is:

Do condominium owners have the right (without the corporation’s approval) to place municipal election signs on the property? Yes or No?

Instructions for Submitting:

The Question for Week Three is now closed – thanks for playing!

NO PURCHASE NECESSARY TO ENTER OR WIN. Open only to legal residents of Ontario who are of legal age of majority and at least nineteen (19) years of age at the time of entry. Not open to employees or immediate family members of employees of Nelligan O’Brien Payne LLP or its affiliated entities. Contest closes at 11:59 p.m. ET on October 29th. One (1) prize available to be won consisting of a one (1) hour free session with a Condo lawyer on a condo topic of your choice. Draw will be conducted on or about October 29th, 2014, and winner will be announced on October 30th, 2014. Odds of winning depend on the total number of eligible entries received for the drawing at issue. Mathematical skill testing question must be answered correctly to win. For full rules, please click here.

Election Signs on Condominium Property

It’s municipal election time again in Ontario. Are condominium owners entitled to place election signs on the condominium property? Section 118 of the Condominium Act, 1998 states that condominium corporations must not restrict the access (to the property) of political canvassers – including canvassers for municipal election – but what about election signs?

In the case of federal elections, the placement of signs is regulated by the Canada Elections Act. The Canada Elections Act says that condominium owners have the right to place signs in their units (for instance, in their windows). However, the condominium corporation can still pass rules to establish reasonable restrictions on the sizes (of the “unit signs”), and also to prohibit signs on the common elements.

In the case of provincial or municipal elections, there is no similar law (like the Canada Elections Act) guaranteeing condominium owners the right to place election signs (in their units). So, when it comes to provincial or municipal elections, condominium corporations have the right to prohibit all election signs (ie. by rule). 

Condominium corporations of course can also consider a rule to allow election signs (including signs on the common elements), but subject to reasonable restrictions. Note as well that most municipalities have by-laws or regulations that place restrictions on election signs (including their size, permitted locations, and permitted display periods). Any rule would of course also be subject to those municipal restrictions.

Week Two Question: The Great Eastern Ontario Condo Quiz – 2014 Edition

Have a question about a condo owner with a noisy pet? Want to know how to remove a director from your condo board? Thinking about buying a condo? Enter to win a one hour conversation on a condo law question of your choice with one of Nelligan O'Brien Payne’s Condo lawyers!*

*For full contest rules, including a description of the prize, please click here.

Take part in The Great Eastern Ontario Condo Quiz – 2014 Edition! There will be a four blog posts containing quiz questions in October. You will receive a ballot for each question that you answer correctly and submit an eligible entry for within each weekly contest period. For example, if you answer four questions correctly and submit eligible entries for each, you will receive four ballots. The winner will be drawn randomly and announced in a blog post on October 30, 2014. For more details on the contest, including how to enter, please click here.

The Official Week Two Question is:

A condominium corporation has the benefit of any warranty (in relation to the common elements) given by the developer to an original purchaser. True or False?

Instructions for Submitting:

The Question for Week Two is now closed – thanks for playing!


NO PURCHASE NECESSARY TO ENTER OR WIN. Open only to legal residents of Ontario who are of legal age of majority and at least nineteen (19) years of age at the time of entry. Not open to employees or immediate family members of employees of Nelligan O’Brien Payne LLP or its affiliated entities. Contest closes at 11:59 p.m. ET on October 29th. One (1) prize available to be won consisting of a one (1) hour free session with a Condo lawyer on a condo topic of your choice. Draw will be conducted on or about October 29th, 2014, and winner will be announced on October 30th, 2014. Odds of winning depend on the total number of eligible entries received for the drawing at issue. Mathematical skill testing question must be answered correctly to win. For full rules, please click here.

Special Provisions Respecting Warranties in Condominium Act

Section 96 of the Condominium Act, 1998, is a special statutory provision dealing with warranties in the condominium setting. It includes the following:

Section 96 (1):  “All warranties given with respect to work and materials furnished for a unit shall be for the benefit of an owner.”

Section 96 (3): “All warranties given with respect to work and materials furnished for the common elements shall be for the benefit of the corporation.”

These provisions can be extremely important when contemplating claims for breach of warranty (in the condominium setting). Here are some things to bear in mind:

  • The Courts have said that the above provisions can also apply to implied warranties. So, for instance, a condominium corporation may have the benefit of common law implied warranties that may apply to the original purchase of a residential unit.
  • The above provisions aren’t specific about the person to whom the warranty is “given”, so:

    • a condominium corporation may have the benefit of any express or implied warranties (with respect to the common elements) given to one or more of the owners, even if those owners no longer own units in the condominium.
    • the condominium corporation may also have the benefit of any express or implied warranties (with respecting to the common elements) given to any other party, such as the developer, builder, or a contractor or sub-contractor involved in work on the property.
       
  • As a result, if a condominium corporation discovers a common element defect, the condominium corporation may be able to consider a claim for breach of warranty (in addition to a claim for negligence) even in cases where the condominium corporation never had any contract with the defendant.

Week One Question: The Great Eastern Ontario Condo Quiz – 2014 Edition

Have a question about a condo owner with a noisy pet? Want to know how to remove a director from your condo board? Thinking about buying a condo? Enter to win a one hour conversation on a condo law question of your choice with one of Nelligan O'Brien Payne’s Condo lawyers!*

*For full contest rules, including a description of the prize, please click here.

Take part in The Great Eastern Ontario Condo Quiz – 2014 Edition! There will be a four blog posts containing quiz questions in October. You will receive a ballot for each question that you answer correctly and submit an eligible entry for within each weekly contest period. For example, if you answer four questions correctly and submit eligible entries for each, you will receive four ballots. The winner will be drawn randomly and announced in a blog post on October 30, 2014. For more details on the contest, including how to enter, please click here.

The Official Week One Question is:

A condominium corporation has the benefit of any warranty (in relation to the common elements) given by the developer to an original purchaser. True or False?

Instructions for Submitting:

Week One is now closed. Thanks for entering!

NO PURCHASE NECESSARY TO ENTER OR WIN. Open only to legal residents of Ontario who are of legal age of majority and at least nineteen (19) years of age at the time of entry. Not open to employees or immediate family members of employees of Nelligan O’Brien Payne LLP or its affiliated entities. Contest closes at 11:59 p.m. ET on October 29th. One (1) prize available to be won consisting of a one (1) hour free session with a Condo lawyer on a condo topic of your choice. Draw will be conducted on or about October 29th, 2014, and winner will be announced on October 30th, 2014. Odds of winning depend on the total number of eligible entries received for the drawing at issue. Mathematical skill testing question must be answered correctly to win. For full rules, please click here.