The coming legislative amendments will bring some changes relating to repair and maintenance obligations of condominium corporations and owners. What are those changes; and what impact will they have on condominium insurance?
The Condominium Act (the “Act”) currently indicates that, subject to the contents of a condominium’s declaration, the condominium corporation is responsible for repairing units after damage. The amended Act will say that owners must repair their units – unless the declaration says otherwise. In our view, this will have very little impact on most condominiums, for the following reason: Almost all declarations spell out the repair and maintenance obligations. In other words, the Act seldom determines the repair and maintenance obligations. As a result, the repair obligations contained in the vast majority of condominium declarations will simply continue to apply, regardless of the changed wording of the Act.
This said, in our view, it will nonetheless make sense for all corporations to review their Declarations – and to consider whether or not the Declaration should be amended – for the following reasons:
(a) The definitions of “repair” and “maintenance” will change – and this might mean some changes of responsibility in the particular condominium. [It would be a good idea for the corporation to understand any such changes of responsibility – and also to consider any resulting desire to amend the Declaration (see below).]
(b) If the Declaration does not spell out the repair and maintenance obligations, the amendments to the Act will indeed change the responsibilities in that condominium.
(c) Some corporations might simply wish to consider an amendment to the Declaration, to change the repair and maintenance obligations set out in the Declaration, whether or not as a result of the coming changes to the Act.
What about condominium insurance?
Notwithstanding the pending amendments to the Act, condominium corporations will still be obligated – under Section 99 of the Act – to obtain and maintain insurance covering the common elements and the standard units. So even though owners may have the obligation to repair their units (as is most often the case now), owners have the benefit of insurance – arranged on their behalves by the corporation – covering their standard units.
The only changes to the insurance regime will be as follows:
(a) There will be a prescribed standard unit description that will apply in cases where condominium corporations don’t have a standard unit by-law.
(b) As described in our recent blog post, there will be changes to responsibility for the deductibles on condominium corporation insurance policies.
Otherwise, the insurance regime is not changing.
Stay tuned to Condo Law News for more blogs about amendments to the Condominium Act.