Condominium Act Reform: Proposed Amendments could Eliminate Insurance Deductible By-laws

TODAY is the deadline to turn in written submissions to the Standing Committee for consideration during their review of Bill 106 – the Protecting Condominium Owners Act.

Bill 106 recently passed on second reading, and is currently before the Standing Committee on Finance and Economic Affairs for review and further public engagement. Several issues are of particular concern to many of us working in the condominium industry. Notably, Bill 106 could prevent condominium corporations from relying on a by-law to extend the circumstances under which they can charge back an insurance deductible to a unit owner. Instead, the bill would require this type of practice to be included in a corporation’s declaration.

If passed, this amendment could pose a huge burden on corporations. Many corporations currently have insurance deductible by-laws (passed with consent from the majority of owners) to assign responsibility for an insurance deductible back to the negligent unit owner.

The requirement to provide for this practice in a declaration, rather than through a by-law, may prove impossible. The issue is that many corporations do not have a provision for this practice in their declaration, and getting the required consent to amend their declaration may be unfeasible.

If you are a condominium owner, board member, or property manager, you may also share this concern. If so, it is important to submit your written objection to the Standing Committee before tomorrow’s deadline.

The Eastern Ontario chapter of CCI has prepared proposed wording for a submission, and has posted it on their website here. The proposed wording is as follows:

Date: _________________________

We, the owners of (Name and Condo Corporation Number) or Member of the Condominium Community (Property Manager) (insert which best represents you), object to the proposed governance change made to Bill 106, Section 105 (4) related to Insurance Deductible By-law.  We respectfully urge that recommendations made in Legislative Brief, Recommendations for Amendments to Bill 106: Protecting Condominium Owners Act submitted October 22, 2015 by the Joint Legislative Committee for the Canadian Condominium Institute (CCI) and Association of Condominium Managers of Ontario (ACMO) be implemented as noted below:

Pages 3 & 4, Issue Sheet No. 3, Governance, Insurance Deductible By-law Retain section 105(3) as drafted in the current Act; Delete section 105(4) from the amended Act; and Additional Note: The Regulations should also make the owner liable under 105(2) for damage caused by an act or omission of the owner and his/her tenants, guests, invitees, licensees and agents.

Signature: _____________________

Written submissions are being accepted up to 6:00 p.m. on Thursday, October 29, 2015. They can be forwarded to the Committee’s Clerk for consideration at the following address:

Committee Clerk
Room 1405, Whitney Block
Queen’s Park
Toronto, Ontario M7A 1A2

Tel: (416) 325-2536
Fax: (416) 325-3505
Email: kkoch@ola.org

See Jim Davidson’s recent blog post about this concern for further information.

Our readers in the condominium industry are welcome to contact our Condominium Law group with any questions about the potential impact of this bill.

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The Condo Law Group is Proud to Announce the Induction of John Peart Into the CCI Hall of Fame!

The National Executive Board of the Canadian Condominium Institute (CCI) recently selected our very own John Peart for induction into the CCI National Hall of Fame. The award recognizes outstanding efforts in the condominium industry, and recipients are considered to be “condominiums heroes”! Established in 2004, John is only the fifth person ever to be inducted into the CCI Hall of Fame.

John received this prestigious award at last night’s CCI National Awards Celebration in Toronto.

A few words from CCI Eastern Ontario President, Nancy Houle: “What really shines through is that John truly cares about people. Not only does he serve our condominium community, he is also an active and effective advocate and leader for our aging community, and specifically issues related to health care and seniors. Our condominium community, both locally and nationally, would not be what it is today without the over 30 years of dedicated and diligent commitment John has made to the industry.”

Congratulations, John!

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Leases to Telecommunications Firms – Things to Consider

From time to time, high-rise condominiums are approached by various telecommunication providers asking to allow antennae and other equipment to be installed on the building’s rooftop. Many high-rise condominium boards see the annual rental being offered by the telecommunication provider as an easy way to help balance the corporation’s budget without any risk to the condominium corporation.

More careful condominium boards, however, will consider the overall impact of such an arrangement, and weigh the benefits of ongoing rental payments with the issues that come with the installation. I will highlight some of these considerations.

A lease of part of a common element to a telecommunication provider requires a by-law pursuant to Section 21 of the Condominium Act. The exception in Section 22 to “Telecommunication Agreements” relates only to network upgrades within the condominium and not to third-party leases. To pass a by-law, there must be a vote of owners, with a majority of all units in favour of it. A condominium board must be satisfied that the necessary votes are available to pass such a by-law.

The location and configuration of the antenna system on the building roof also sometimes causes concerns to owners. The board will have to determine whether the owners will consider the installation as detracting from the building’s look.

There are also other concerns. Will the installation interfere with existing leases that the condominium corporation may already have in place? Will the installation interfere with current or proposed telecommunication reception received by the residents? Will the installation and ongoing maintenance of the antenna and equipment interfere with the use of the common elements by the residents? Will the telecommunication tenant be paying the condominium corporation’s legal fees and engineering costs (related to the lease and the equipment)?

A condominium board is wise to consider the overall impact of what a telecommunication installation will mean both to the building and to the lifestyle of the residents. Only when these issues have been considered and resolved can the board then negotiate the lease terms.

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Condominium Act Reform: Standing Committee Set to Hear Public Input on Bill 106

As it stands now, Bill 106 – Protecting Condominium Owners Act passed its second reading on October 7, 2015, and has been referred to the Standing Committee on Finance and Economic Affairs. We now have greater insight into what the public engagement process will look like.

The Standing Committee’s process was quickly confirmed and imposes some very tight deadlines for stakeholders to provide their input. This may be an indication that Bill 106 is maintaining the momentum that has brought it through the legislative process this quickly.

The Committee has scheduled public hearings in Toronto for October 22, 2015 and October 29, 2015. Submissions were accepted up to October 19, 2015 from those parties interested in being considered for oral presentations. It does not appear that any further applications for in-person submissions will be taken.

However, written submissions are being accepted up to 6:00 p.m. on Thursday, October 29, 2015. They can be forwarded to the Committee’s Clerk for consideration at the following address:

Committee Clerk
Room 1405, Whitney Block
Queen’s Park
Toronto, Ontario M7A 1A2

Tel: (416) 325-2536
Fax: (416) 325-3505
Email: kkoch@ola.org

For an idea of the issues and areas of the legislation the Standing Committee will likely hear about, check out Jim Davidson’s recent blog posts outlining his concerns with the proposed amendments that must be addressed.

The full text of the Bill 106 is available here.

Our readers in the condominium industry are welcome to contact our Condominium Law group to discuss the potential impact of this bill.

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What Can Be Done To Collect Older Common Expense Arrears? Another Court Decision That Limits Options

A recent Ontario Superior Court decision has confirmed previous case-law that a condominium corporation cannot revive its expired lien rights for unsecured common expense arrears.

TCECC 2041 v TSCC 2051 was a dispute between a common elements condominium corporation (TCECC 2041) and another condominium corporation (TSCC 2051), which is located on one of the parcels of tied land of the common elements condominium. TCECC 2041 was attempting to recover alleged common expense arrears from the owners of all of the units in TSCC 2051. In an attempt to recover the alleged common expenses, TCECC 2041 registered liens against the units in TSCC 2051.

The Court said that a condominium lien could only secure arrears that had fallen due within three months prior to registration of the lien.

The Court also said that, as in the previous case TSCC 1908 v Stefco, a condominium corporation cannot revive expired lien rights (by application under Section 134 of the Condominium Act). And in cases where the lien rights have expired, the corporation’s only option is to seek recovery of the arrears by way of court claim or arbitration (as an unsecured creditor). The Court noted that any such unsecured claim must be started within the two-year limitation period (i.e. within two years of the alleged default).

Given the facts of this case, the Court directed the dispute to mandatory mediation and arbitration.

A detailed summary of this case addressing many of the other issues discussed in the decision, and the link to read the entire case, can be found at Jim Davidson’s Condo Cases Across Canada.

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